Commerce Proposes New Rule to Suspend Antidumping or Countervailing Duty Collection on Ongoing Circumvention Investigations Involving CSPVs | McDermott Will & Emery
On July 1, 2022, the U.S. Department of Commerce (Commerce) issued a proposed rule to suspend the collection of any anti-dumping (AD) or countervailing (CVD) duties in connection with its ongoing cell circumvention investigations and crystalline silicon photovoltaic (CSPV) modules from four Southeast Asian countries. The Commerce Department’s proposed rule, if passed, would provide more certainty of the AD/CVD duty liability for importers and purchasers of CSPVs from these countries during the period this “pause” is in effect. force (probably until June 6, 2024). Comments on this proposed rule are expected by August 1, 2022.
SUMMARY OF PROPOSED TRADE REGULATIONS
Commerce’s proposed rule implements U.S. President Joe Biden’s Proclamation 10414, issued June 6, 2022, which has declared an emergency under Section 318 of the Tariff Act 1930 concerning the electricity production capacities of the United States. This proclamation announced various measures to deal with the emergency, including allowing Commerce to authorize the import of CSPVs from Cambodia, Malaysia, Thailand and Vietnam (target countries) without collecting AD or CVD duties. related to the ongoing bypass process through June 6, 2024. , or the date the emergency described in proclamation 10414 ended, whichever comes first (termination date). The proclamation, as implemented by the Commerce Department’s proposed regulations, will provide temporary relief from cash deposits or import duties that may be assessed as a result of the ongoing investigation to determine whether CSPVs imported from target countries circumvent the AD and CVD orders on CSPVs of the People of the Republic of China.
Commerce’s proposed rule, which it intends to codify at 19 CFR § 364, would provide much-needed additional certainty and clarity to the process of importing CSPVs from target countries during the suspension period. the imposition of duties or cash deposits. The proposed rule states that the Commerce Department will not direct U.S. Customs and Border Protection (CBP) to withhold liquidation or collect cash deposits of estimated duties that may result from an affirmative determination. bypass for any CSPV entered into the United States prior to the termination date. In addition, the Department will direct CBP to end the suspension of liquidation and refund any cash deposits for CSPV entries for which CBP suspended liquidation and required cash deposits upon initiation of investigations by the Department. In other words, CSPVs from target countries, if entered prior to the termination date, will not be subject to cash deposits or duties, whether or not the Department has made affirmative circumvention determinations between -time. For CSPV entries on or after the date of termination, and in the event of a final affirmative circumvention determination, the Department will direct CBP to suspend liquidation and collect AD and CVD cash deposits on such merchandise.
The proposal contains three important caveats:
- The Commerce Department specifically noted that certain CSPVs that have already been found to be “in scope” of certain AD/CVD orders covering imports of CSPVs from China or Taiwan (irrespective of ongoing circumvention investigations) will not be considered covered by the proposed rule and will not be able to enter the United States duty-free.
- The Commerce Department noted that its instructions to CBP to allow duty-free entry of CSPVs from target countries would not limit CBP’s authority to independently determine the country of origin for imported goods. Thus, CBP may determine that CSPVs are subject to such Chinese or Taiwanese anti-dumping/compensation orders and are not eligible for duty-free treatment.
- The proposed rule explicitly states that it will not limit Commerce’s authority to require certifications of CSPV imports in the event of an affirmative circumvention determination. The Department of Commerce has previously sought comments from interested parties regarding certifications in the event of an affirmative determination, importers and buyers of CSPVs from target countries should therefore be aware that, even if they import CSPVs duty-free, they and their suppliers may have to comply with any certification regime that trade may impose. It is unclear what action the Department would take if required certifications were not provided for entries during the temporary relief period.
This temporary duty pause is intended to allow the United States to expand its domestic CSPV manufacturing capacity. Although Proclamation 10414 and the Termination Date (as defined in Commerce’s Proposed Regulations) leave open the possibility that the U.S. power generation capacity emergency may be resolved before June 6, 2024 , this seems unlikely given the significant time required to develop CSPV manufacturing capability. It remains to be seen what other government initiatives, including the President’s proposed use of the Defense Production Act, will be used to support the demand and production of cells and modules manufactured in the United States.