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Passenger Vehicle and Light Truck Tires From the Socialist Republic of Vietnam: Final Affirmative Countervailing Duty Determination


American Government

Passenger Vehicle and Light Truck Tires From the Socialist Republic of Vietnam: Final Affirmative Countervailing Duty Determination

Christian Marsh
Department of Commerce
27 May 2021


[Federal Register Volume 86, Number 101 (Thursday, May 27, 2021)]
[Notices]
[Pages 28566-28569]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-11265]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-552-829]


Passenger Vehicle and Light Truck Tires From the Socialist 
Republic of Vietnam: Final Affirmative Countervailing Duty 
Determination

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

SUMMARY: The Department of Commerce (Commerce) determines that 
countervailable subsidies are being provided to producers and exporters 
of passenger vehicle and light truck tires (passenger tires) from the 
Socialist Republic of Vietnam (Vietnam).

DATES: Applicable May 27, 2021.

FOR FURTHER INFORMATION CONTACT: Michael Romani or Thomas Schauer, AD/
CVD Operations, Office I, Enforcement and Compliance, International 
Trade Administration, U.S. Department of Commerce, 1401 Constitution 
Avenue NW, Washington, DC 20230; telephone: (202) 482-0198 or (202) 
482-0410, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On November 10, 2020, Commerce published the Preliminary 
Determination in the Federal Register.\1\ In addition to the Government 
of Vietnam (GOV), the mandatory respondents in this investigation are 
Kumho Tire (Vietnam) Co., Ltd. (KTV) and Sailun (Vietnam) Co., Ltd. 
(Sailun). In the Preliminary Determination, and in accordance with 
section 705(a)(1) of the Tariff Act of 1930, as amended (the Act), and 
19 CFR 351.210(b)(4), Commerce aligned the final countervailable duty 
(CVD) determination with the final antidumping duty (AD) 
determination.\2\
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    \1\ See Passenger Vehicle and Light Truck Tires from the 
Socialist Republic of Vietnam: Preliminary Affirmative 
Countervailing Duty Determination and Alignment of Final 
Determination With Final Antidumping Duty Determination, 85 FR 71607 
(November 10, 2020) (Preliminary Determination), and accompanying 
Preliminary Decision Memorandum.
    \2\ See Preliminary Determination, 85 FR at 71608.
---------------------------------------------------------------------------

    A summary of the events that occurred since Commerce published the 
Preliminary Determination is found in the Issues and Decision 
Memorandum.\3\ The Issues and Decision Memorandum is a public document 
and is on file electronically via Enforcement and Compliance's 
Antidumping and Countervailing Duty Centralized Electronic Service 
System (ACCESS). ACCESS is available to registered users at http://access.trade.gov. In addition, a complete version of the Issues and 
Decision Memorandum can be accessed directly at http://enforcement.trade.gov/frn/.
---------------------------------------------------------------------------

    \3\ See Memorandum, ``Issues and Decision Memorandum for the 
Final Determination in the Countervailing Duty Investigation of 
Passenger Vehicle and Light Truck Tires from the Socialist Republic 
of Vietnam,'' dated concurrently with, and hereby adopted by, this 
notice (Issues and Decision Memorandum).
---------------------------------------------------------------------------

Period of Investigation

    The period of investigation is January 1, 2019, through December 
31, 2019.

Scope of the Investigation

    The products covered by this investigation are passenger tires from 
Vietnam. For a complete description of the scope of the investigation, 
see Appendix I.

Scope Comments

    During the course of this investigation, Commerce received scope 
comments from interested parties. Commerce issued a Preliminary Scope 
Decision Memorandum to address these comments.\4\ We received comments 
from interested parties on the Preliminary Scope Decision Memorandum, 
which we address in the Final Scope Decision Memorandum.\5\ With the 
exception of one revision to correct a typographical error, Commerce is 
not modifying the scope language as it appeared in the correction to 
the preliminary determinations issued in the concurrent AD 
investigations.\6\ See Appendix I for the final scope of the 
investigation.
---------------------------------------------------------------------------

    \4\ See Memorandum, ``Passenger Vehicle and Light Truck Tires 
from the Republic of Korea, Taiwan, Thailand, and the Socialist 
Republic of Vietnam: Preliminary Scope Comments Decision 
Memorandum,'' dated December 29, 2020 (Preliminary Scope Decision 
Memorandum).
    \5\ See Memorandum, ``Passenger Vehicle and Light Truck Tires 
from the Republic of Korea, Taiwan, Thailand, and the Socialist 
Republic of Vietnam: Scope Comments Final Decision Memorandum,'' 
dated concurrently with, and hereby adopted by, this notice (Final 
Scope Decision Memorandum).
    \6\ See Passenger Vehicle and Light Truck Tires from the 
Republic of Korea, Taiwan, Thailand, and the Socialist Republic of 
Vietnam: Notice of Correction to Preliminary Determinations in Less-
Than-Fair-Value Investigations, 86 FR 7252 (January 27, 2021).
---------------------------------------------------------------------------

Verification

    Commerce was unable to conduct on-site verification of the 
information relied upon in making its final determination in this 
investigation. However, we took additional steps in lieu of on-site 
verification to verify the information relied upon in making this final 
determination, in accordance with section 782(i) of the Act.\7\
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    \7\ See Commerce's Letters, dated February 18, 2021; see also 
GOV's Letter, ``Passenger Vehicle and Light Truck Tires from the 
Socialist Republic of Vietnam: GOV's Verification Questionnaire 
Response,'' dated February 26, 2021; KTVs Letter, ``Countervailing 
Duty Investigation of Passenger Vehicle and Light Truck Tires from 
Vietnam--Response to February 18 In Lieu of Verification 
Questionnaire,'' dated February 26, 2021; and Sailun's Letter, 
``Sailun Verification Questionnaire Response in the Countervailing 
Duty Investigation of Passenger Vehicle and Light Truck Tires 
(``PVLT'') From Vietnam (C-552-829),'' dated February 26, 2021.
---------------------------------------------------------------------------

Analysis of Subsidy Programs and Comments Received

    The subsidy programs under investigation and the issues raised in 
the case and rebuttal briefs by parties in this investigation are 
discussed in the Issues and Decision Memorandum. For a list of the 
issues raised by parties, to which we responded in the Issues and 
Decision Memorandum, see Appendix II of this notice.

Methodology

    Commerce conducted this investigation in accordance with section 
701 of the Act. For each of the subsidy programs found countervailable, 
Commerce determines that there is a subsidy, i.e., a financial 
contribution by an ``authority'' that gives rise to a benefit to the 
recipient, and that the subsidy is specific.\8\ For a full

[[Page 28567]]

description of the methodology underlying this final determination, see 
the Issues and Decision Memorandum.
---------------------------------------------------------------------------

    \8\ See sections 771(5)(B) and (D) of the Act regarding 
financial contribution; section 771(5)(E) of the Act regarding 
benefit; and section 771(5A) of the Act regarding specificity.
---------------------------------------------------------------------------

Changes Since the Preliminary Determination

    Based on our review and analysis of the record and the comments 
received, we made certain changes to the countervailable subsidy rate 
calculations. For discussion of these changes, see the Issues and 
Decision Memorandum.

All-Others Rate

    Section 705(c)(5)(A) of the Act provides that in the final 
determination, Commerce shall determine an all-others rate for 
companies not individually examined. This rate shall be an amount equal 
to the weighted average of the estimated subsidy rates established for 
those companies individually examined, excluding any rates that are 
zero, de minimis, or based entirely under section 776 of the Act.
    In this investigation, Commerce calculated individual estimated 
countervailable subsidy rates for KTV and Sailun that are not zero, de 
minimis, or based entirely on facts otherwise available. Commerce 
calculated the all-others rate using a weighted average of the 
individual estimated subsidy rates calculated for the examined 
respondents using each company's publicly-ranged values for the 
merchandise under consideration.\9\
---------------------------------------------------------------------------

    \9\ With two respondents under examination, Commerce normally 
calculates: (A) A weighted-average of the estimated subsidy rates 
calculated for the examined respondents; (B) a simple average of the 
estimated subsidy rates calculated for the examined respondents; and 
(C) a weighted-average of the estimated subsidy rates calculated for 
the examined respondents using each company's publicly-ranged U.S. 
sale quantities for the merchandise under consideration. Commerce 
then compares (B) and (C) to (A) and selects the rate closest to (A) 
as the most appropriate rate for all other producers and exporters. 
See, e.g., Ball Bearings and Parts Thereof from France, Germany, 
Italy, Japan, and the United Kingdom: Final Results of Antidumping 
Duty Administrative Reviews, Final Results of Changed-Circumstances 
Review, and Revocation of an Order in Part, 75 FR 53661, 53663 
(September 1, 2010). As complete publicly ranged sales data was 
available, Commerce based the all-others rate on the publicly ranged 
sales data of the mandatory respondents. For a complete analysis of 
the data, see Memorandum, ``Countervailing Duty Investigation of 
Passenger Vehicle and Light Truck Tires from the Socialist Republic 
of Vietnam: Calculation of All-Others Rate,'' dated concurrently 
with this notice.
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Final Determination

    We determine the countervailable subsidy rates to be:

------------------------------------------------------------------------
                                                               Subsidy
                          Company                                rate
                                                              (percent)
------------------------------------------------------------------------
Kumho Tire (Vietnam) Co., Ltd..............................         7.89
Sailun (Vietnam) Co., Ltd..................................         6.23
All Others.................................................         6.46
------------------------------------------------------------------------

Disclosure

    We intend to disclose the calculations performed in this final 
determination to interested parties within five days of any public 
announcement or, if there is no public announcement, within five days 
of the date of the publication of this notice in the Federal Register, 
in accordance with 19 CFR 351.224(b).

Continuation of Suspension of Liquidation

    As a result of our Preliminary Determination, and pursuant to 
section 703(d)(1)(B) and (d)(2) of the Act, we instructed U.S. Customs 
and Border Protection (CBP) to suspend liquidation of all passenger 
tires from Vietnam, that were entered, or withdrawn from warehouse, for 
consumption on or after November 10, 2020, the date of the publication 
of the Preliminary Determination in the Federal Register.
    In accordance with section 703(d) of the Act, effective March 10, 
2021, we instructed CBP to discontinue the suspension of liquidation of 
all entries, but to continue the suspension of liquidation of all 
entries between November 10, 2020, through March 9, 2021.
    If the U.S. International Trade Commission (ITC) issues a final 
affirmative injury determination, we will issue a CVD order, reinstate 
the suspension of liquidation, and require a cash deposit of estimated 
countervailable duties for such entries of subject merchandise in the 
amounts indicated above, in accordance with section 706(a) of the Act. 
If the ITC determines that material injury, or threat of material 
injury, does not exist, this proceeding will be terminated and all cash 
deposits will be refunded or canceled.

ITC Notification

    In accordance with section 705(d) of the Act, we will notify the 
ITC of our determination. Because the final determination in this 
proceeding is affirmative, in accordance with section 705(b) of the 
Act, the ITC will make its final determination as to whether the 
domestic industry in the United States is materially injured, or 
threatened with material injury, by reason of imports of passenger 
tires from Vietnam no later than 45 days after our final determination. 
In addition, we are making available to the ITC all non-privileged and 
non-proprietary information related to this investigation. We will 
allow the ITC access to all privileged and business proprietary 
information in our files, provided the ITC confirms that it will not 
disclose such information, either publicly or under an administrative 
protective order (APO), without the written consent of the Assistant 
Secretary for Enforcement and Compliance.

Notification Regarding APO

    In the event that the ITC issues a final negative injury 
determination, this notice will serve as the only reminder to the 
parties subject to APO of their responsibility concerning the 
disposition of proprietary information disclosed under APO in 
accordance with 19 CFR 351.305(a)(3). Timely written notification of 
the return or destruction of APO materials, or conversion to judicial 
protective order, is hereby requested. Failure to comply with the 
regulations and terms of an APO is a violation subject to sanction.

Notification to Interested Parties

    This determination is issued and published in accordance with 
sections 705(d) and 777(i) of the Act, and 19 CFR 351.210(c).

    Dated: May 21, 2021.
Christian Marsh,
Acting Assistant Secretary for Enforcement and Compliance.

Appendix I--Scope of the Investigation

    The scope of this investigation is passenger vehicle and light 
truck tires. Passenger vehicle and light truck tires are new 
pneumatic tires, of rubber, with a passenger vehicle or light truck 
size designation. Tires covered by this investigation may be tube-
type, tubeless, radial, or non-radial, and they may be intended for 
sale to original equipment manufacturers or the replacement market.
    Subject tires have, at the time of importation, the symbol 
``DOT'' on the sidewall, certifying that the tire conforms to 
applicable motor vehicle safety standards. Subject tires may also 
have the following prefixes or suffix in their tire size 
designation, which also appears on the sidewall of the tire:
    Prefix designations:
    P--Identifies a tire intended primarily for service on passenger 
cars.
    LT--Identifies a tire intended primarily for service on light 
trucks.
    Suffix letter designations:
    LT--Identifies light truck tires for service on trucks, buses, 
trailers, and multipurpose passenger vehicles used in nominal 
highway service.
    All tires with a ``P'' or ``LT'' prefix, and all tires with an 
``LT'' suffix in their sidewall markings are covered by this 
investigation regardless of their intended use.
    In addition, all tires that lack a ``P'' or ``LT'' prefix or 
suffix in their sidewall markings, as

[[Page 28568]]

well as all tires that include any other prefix or suffix in their 
sidewall markings, are included in the scope, regardless of their 
intended use, as long as the tire is of a size that fits passenger 
cars or light trucks. Sizes that fit passenger cars and light trucks 
include, but are not limited to, the numerical size designations 
listed in the passenger car section or light truck section of the 
Tire and Rim Association Year Book, as updated annually. The scope 
includes all tires that are of a size that fits passenger cars or 
light trucks, unless the tire falls within one of the specific 
exclusions set out below.
    Passenger vehicle and light truck tires, whether or not attached 
to wheels or rims, are included in the scope. However, if a subject 
tire is imported attached to a wheel or rim, only the tire is 
covered by the scope.
    Specifically excluded from the scope are the following types of 
tires:
    (1) Racing car tires; such tires do not bear the symbol ``DOT'' 
on the sidewall and may be marked with ``ZR'' in size designation;
    (2) pneumatic tires, of rubber, that are not new, including 
recycled and retreaded tires;
    (3) non-pneumatic tires, such as solid rubber tires;
    (4) tires designed and marketed exclusively as temporary use 
spare tires for passenger vehicles which, in addition, exhibit each 
of the following physical characteristics:
    (a) The size designation and load index combination molded on 
the tire's sidewall are listed in Table PCT-1R (``T'' Type Spare 
Tires for Temporary Use on Passenger Vehicles) or PCT-1B (``T'' Type 
Diagonal (Bias) Spare Tires for Temporary Use on Passenger Vehicles) 
of the Tire and Rim Association Year Book,
    (b) the designation ``T'' is molded into the tire's sidewall as 
part of the size designation, and,
    (c) the tire's speed rating is molded on the sidewall, 
indicating the rated speed in MPH or a letter rating as listed by 
Tire and Rim Association Year Book, and the rated speed is 81 MPH or 
a ``M'' rating;
    (5) tires designed and marketed exclusively as temporary use 
spare tires for light trucks which, in addition, exhibit each of the 
following physical characteristics:
    (a) The tires have a 265/70R17, 255/80R17, 265/70R16, 245/70R17, 
245/75R17, 245/70R18, or 265/70R18 size designation;
    (b) ``Temporary Use Only'' or ``Spare'' is molded into the 
tire's sidewall;
    (c) the tread depth of the tire is no greater than 6.2 mm; and
    (d) Uniform Tire Quality Grade Standards (``UTQG'') ratings are 
not molded into the tire's sidewall with the exception of 265/70R17 
and 255/80R17 which may have UTQG molded on the tire sidewall;
    (6) tires designed and marketed exclusively for specialty tire 
(ST) use which, in addition, exhibit each of the following 
conditions:
    (a) The size designation molded on the tire's sidewall is listed 
in the ST sections of the Tire and Rim Association Year Book,
    (b) the designation ``ST'' is molded into the tire's sidewall as 
part of the size designation,
    (c) the tire incorporates a warning, prominently molded on the 
sidewall, that the tire is ``For Trailer Service Only'' or ``For 
Trailer Use Only'',
    (d) the load index molded on the tire's sidewall meets or 
exceeds those load indexes listed in the Tire and Rim Association 
Year Book for the relevant ST tire size, and
    (e) either
    (i) the tire's speed rating is molded on the sidewall, 
indicating the rated speed in MPH or a letter rating as listed by 
Tire and Rim Association Year Book, and the rated speed does not 
exceed 81 MPH or an ``M'' rating; or
    (ii) the tire's speed rating molded on the sidewall is 87 MPH or 
an ``N'' rating, and in either case the tire's maximum pressure and 
maximum load limit are molded on the sidewall and either
    (1) both exceed the maximum pressure and maximum load limit for 
any tire of the same size designation in either the passenger car or 
light truck section of the Tire and Rim Association Year Book; or
    (2) if the maximum cold inflation pressure molded on the tire is 
less than any cold inflation pressure listed for that size 
designation in either the passenger car or light truck section of 
the Tire and Rim Association Year Book, the maximum load limit 
molded on the tire is higher than the maximum load limit listed at 
that cold inflation pressure for that size designation in either the 
passenger car or light truck section of the Tire and Rim Association 
Year Book;
    (7) tires designed and marketed exclusively for off-road use and 
which, in addition, exhibit each of the following physical 
characteristics:
    (a) The size designation and load index combination molded on 
the tire's sidewall are listed in the off-the-road, agricultural, 
industrial or ATV section of the Tire and Rim Association Year Book,
    (b) in addition to any size designation markings, the tire 
incorporates a warning, prominently molded on the sidewall, that the 
tire is ``Not For Highway Service'' or ``Not for Highway Use'',
    (c) the tire's speed rating is molded on the sidewall, 
indicating the rated speed in MPH or a letter rating as listed by 
the Tire and Rim Association Year Book, and the rated speed does not 
exceed 55 MPH or a ``G'' rating, and
    (d) the tire features a recognizable off-road tread design;
    (8) Tires designed and marketed for off-road use as all-terrain-
vehicle (ATV) tires or utility-terrain-vehicle (UTV) tires, and 
which, in addition, exhibit each of the following characteristics:
    (a) The tire's speed rating is molded on the sidewall, 
indicating the rated speed in MPH or a letter rating as listed by 
the Tire and Rim Association Year Book, and the rated speed does not 
exceed 87 MPH or an ``N'' rating, and
    (b) both of the following physical characteristics are 
satisfied:
    (i) The size designation and load index combination molded on 
the tire's sidewall does not match any of those listed in the 
passenger car or light truck sections of the Tire and Rim 
Association Year Book, and
    (ii) The size designation and load index combination molded on 
the tire's sidewall matches any of the following size designation 
(American standard or metric) and load index combinations:

------------------------------------------------------------------------
       American standard size              Metric size        Load index
------------------------------------------------------------------------
26x10R12...........................  254/70R/12                       72
27x10R14...........................  254/65R/14                       73
28x10R14...........................  254/70R/14                       75
28x10R14...........................  254/70R/14                       86
30x10R14...........................  254/80R/14                       79
30x10R15...........................  254/75R/15                       78
30x10R14...........................  254/80R/14                       90
31x10R14...........................  254/85R/14                       81
32x10R14...........................  254/90R/14                       95
32x10R15...........................  254/85R/15                       83
32x10R15...........................  254/85R/15                       94
33x10R15...........................  254/90R/15                       86
33x10R15...........................  254/90R/15                       95
35x9.50R15.........................  241/105R/15                      82
35x10R15...........................  254/100R/15                      97
------------------------------------------------------------------------

    The products covered by this investigation are currently 
classified under the following Harmonized Tariff Schedule of the 
United States (HTSUS) subheadings: 4011.10.10.10, 4011.10.10.20, 
4011.10.10.30, 4011.10.10.40, 4011.10.10.50, 4011.10.10.60, 
4011.10.10.70, 4011.10.50.00, 4011.20.10.05, and 4011.20.50.10. 
Tires meeting the scope description may also enter under the 
following HTSUS subheadings: 4011.90.10.10, 4011.90.10.50, 
4011.90.20.10, 4011.90.20.50, 4011.90.80.10, 4011.90.80.50, 
8708.70.45.30, 8708.70.45.46, 8708.70.45.48, 8708.70.45.60, 
8708.70.60.30, 8708.70.60.45, and 8708.70.60.60. While HTSUS 
subheadings are provided for convenience and for customs purposes, 
the written description of the subject merchandise is dispositive.

Appendix II--List of Topics Discussed in the Final Decision Memorandum

I. Summary
II. Background
III. Scope of the Investigation
IV. Subsidies Valuation Information
V. Analysis of Programs
VI. Analysis of Comments
    Comment 1: Whether International and U.S. Law Permits Commerce 
to Countervail Exchanges of Undervalued Currency
    Comment 2: Whether Commerce's Promulgation of the Currency 
Regulations in the Absence of Legislative Authority Is Outside Its 
Legal Authority
    Comment 3: Whether an Exchange of Currency Constitutes a 
Financial Contribution
    Comment 4: Whether the Currency Program Is Specific
    Comment 5: Whether the Vietnamese Dong Was Undervalued During 
the POI
    Comment 6: Whether Countervailing Currency Exchanges Results in 
a Double Remedy
    Comment 7: How the Subsidy Rate for the Currency Program Should 
Be Calculated
    Comment 8: Whether Import Duty Exemptions for Raw Materials Are 
Countervailable
    Comment 9: Whether Commerce Should Revise the Benchmark for the 
Provision of Natural Rubber to KTV
    Comment 10: Whether KTV's Preferential Rent is Countervailable

[[Page 28569]]

    Comment 11: Whether Sailun Used the Program on Preferential Rent
    Comment 12: Whether Commerce Should Revise the Benchmark for 
Preferential Rent for KTV
VII. Recommendation

[FR Doc. 2021-11265 Filed 5-26-21; 8:45 am]
BILLING CODE 3510-DS-P




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