Certain Paper Shopping Bags From the People's Republic of China and India: Countervailing Duty Orders

AGENCY:

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

SUMMARY:

Based on affirmative final determinations by the U.S. Department of Commerce (Commerce) and the U.S. International Trade Commission (ITC), Commerce is issuing countervailing duty orders on certain paper shopping bags (paper bags) from the People's Republic of China (China) and India.

DATES:

Applicable July 18, 2024.

FOR FURTHER INFORMATION CONTACT:

Robert Copyak (China) or Paul Kebker (India), AD/CVD Operations, Offices IX and IV, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-3642 and (202) 482-2254, respectively.

SUPPLEMENTARY INFORMATION:

Background

In accordance with section 705(d) of the Tariff Act of 1930, as amended (the Act), on May 24, 2024, Commerce published its affirmative final determinations that countervailable subsidies are being provided to producers and exporters of paper bags from China and India. On July 5, 2024, the ITC notified Commerce of its final affirmative determinations that an industry in the United States is materially injured by reason of subsidized imports of paper bags from China and India, within the meaning of section 705(b)(1)(A)(i) of the Act. Further, the ITC determined that critical circumstances do not exist with respect to imports of paper bags from China and India.

Scope of the Orders

The products covered by these orders are paper bags from China and India. For a complete description of the scope of the orders, see the appendix to this notice.

Orders

As stated above, on July 5, 2024, the ITC notified Commerce of its final determinations that an industry in the United States is materially injured within the meaning of section 705(b)(1)(A)(i) of the Act by reason of subsidized imports of paper bags from China and India. Therefore, in accordance with section 705(c)(2) of the Act, Commerce is issuing these countervailing duty orders. Moreover, because the ITC determined that imports of paper bags from China and India are materially injuring a U.S. industry, unliquidated entries of such merchandise from China and India, entered or withdrawn from warehouse for consumption, are subject to the assessment of countervailing duties.

Therefore, in accordance with section 706(a) of the Act, Commerce intends to direct U.S. Customs and Border Protection (CBP) to assess, upon further instruction by Commerce, countervailing duties on unliquidated entries of paper bags from China and India entered, or withdrawn from warehouse, for consumption on or after November 6, 2023, the date of the publication of the Preliminary Determinations, but will not include entries occurring after the expiration of the provisional measures and before the publication in the Federal Register of the ITC's final injury determination under section 705(b) of the Act, as further described in the “Provisional Measures” section of this notice.

Suspension of Liquidation

In accordance with section 706 of the Act, Commerce intends to instruct CBP to reinstitute the suspension of liquidation on all entries of paper bags from China and India, effective on the date of publication of the ITC's final affirmative injury determination in the Federal Register , and to assess, upon further instruction by Commerce, pursuant to section 706(a)(1) of the Act, countervailing duties for each entry of subject merchandise in an amount based on the net countervailable subsidy rates below. On or after the date of publication of the ITC's final affirmative injury determination in the Federal Register , we will also instruct CBP to require cash deposits on entries of subject merchandise as indicated below. These instructions suspending liquidation will remain in effect until further notice. The all-others rate applies to all producers or exporters not specifically listed below, as appropriate.

Estimated Countervailable Subsidy Rates

The estimated countervailable subsidy rates are as follows:

Provisional Measures

Section 703(d) of the Act states that the suspension of liquidation pursuant to an affirmative preliminary determination may not remain in effect for more than four months. Commerce published the Preliminary Determinations on November 6, 2023. As such, the four-month period beginning on the date of the publication of the Preliminary Determinations ended on March 4, 2024.

Therefore, in accordance with section 703(d) of the Act, we instructed CBP to terminate the suspension of liquidation and to liquidate, without regard to countervailing duties, unliquidated entries of paper bags from China and India entered, or withdrawn from warehouse, for consumption, on or after March 5, 2024, the date on which the provisional measures expired, until and through the day preceding the date of publication of the ITC's final injury determination in the Federal Register . Suspension of liquidation and the collection of cash deposits will resume on the date of publication of the ITC's final determination in the Federal Register .

Critical Circumstances

Regarding the ITC's negative critical circumstances determination on imports of paper bags from China and India, we intend to instruct CBP to lift suspension and to refund any cash deposits made to secure the payment of estimated countervailing duties with respect to entries of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after August 8, 2023 ( i.e., 90 days prior to the date of the publication of the Preliminary Determinations ), but before November 6, 2023 ( i.e., the date of publication of the Preliminary Determinations).

Establishment of the Annual Inquiry Service Lists

On September 20, 2021, Commerce published the Final Rule in the Federal Register . On September 27, 2021, Commerce also published the Procedural Guidance in the Federal Register . The Final Rule and Procedural Guidance provide that Commerce will maintain an annual inquiry service list for each order or suspended investigation, and any interested party submitting a scope ruling application or request for circumvention inquiry shall serve a copy of the application or request on the persons on the annual inquiry service list for that order, as well as any companion order covering the same merchandise from the same country of origin.

In accordance with the Procedural Guidance, for orders published in the Federal Register after November 4, 2021, Commerce will create an annual inquiry service list segment in Commerce's online e-filing and document management system, Antidumping and Countervailing Duty Electronic Service System (ACCESS), available at https://access.trade.gov, within five business days of publication of the notice of the order. Each annual inquiry service list will be saved in ACCESS, under each case number, and under a specific segment type called “AISL-Annual Inquiry Service List.”

Interested parties who wish to be added to the annual inquiry service list for an order must submit an entry of appearance to the annual inquiry service list segment for the order in ACCESS within 30 days after the date of publication of the order. For ease of administration, Commerce requests that law firms with more than one attorney representing interested parties in an order designate a lead attorney to be included on the annual inquiry service list. Commerce will finalize the annual inquiry service list within five business days thereafter. As mentioned in the Procedural Guidance, the new annual inquiry service list will be in place until the following year, when the Opportunity Notice for the anniversary month of the order is published.

Commerce may update an annual inquiry service list at any time as needed based on interested parties' amendments to their entries of appearance to remove or otherwise modify their list of members and representatives, or to update contact information. Any changes or announcements pertaining to these procedures will be posted to the ACCESS website.

Special Instructions for Petitioners and Foreign Governments

In the Final Rule, Commerce stated that, “after an initial request and placement on the annual inquiry service list, both petitioners and foreign governments will automatically be placed on the annual inquiry service list in the years that follow.” Accordingly, as stated above, the petitioner and the Governments of China and India should submit their initial entries of appearance after publication of this notice in order to appear in the first annual inquiry service lists for these orders. Pursuant to 19 CFR 351.225(n)(3), the petitioner and the Governments of China and India will not need to resubmit their entries of appearance each year to continue to be included on the annual inquiry service list. However, the petitioner and the Governments of China and India are responsible for making amendments to their entries of appearance during the annual update to the annual inquiry service list in accordance with the procedures described above.

Notification to Interested Parties

This notice constitutes the countervailing duty orders with respect to paper bags from China and India pursuant to section 706(d) of the Act. Interested parties can find a list of countervailing duty orders at https://enforcement.trade.gov/stats/iastats1.html.

These orders are issued and published in accordance with section 706(a) and 19 CFR 351.211(b).

Appendix

Scope of the Orders

The products within the scope of these orders are paper shopping bags with handles of any type, regardless of whether there is any printing, regardless of how the top edges are finished ( e.g., folded, serrated, or otherwise finished), regardless of color, and regardless of whether the top edges contain adhesive or other material for sealing closed. Subject paper shopping bags have a width of at least 4.5 inches and depth of at least 2.5 inches.

Paper shopping bags typically are made of kraft paper but can be made from any type of cellulose fiber, paperboard, or pressboard with a basis weight less than 300 grams per square meter (GSM).

A non-exhaustive illustrative list of the types of handles on shopping bags covered by the scope include handles made from any materials such as twisted paper, flat paper, yarn, ribbon, rope, string, or plastic, as well as die-cut handles (whether the punchout is fully removed or partially attached as a flap).

Excluded from the scope are:

• Paper sacks or bags that are of a 1/6 or 1/7 barrel size(i.e., 11.5-12.5 inches in width, 6.5-7.5 inches in depth, and 13.5-17.5 inches in height) with flat paper handles or die-cut handles;
• Paper sacks or bags with die-cut handles, a grams per square meter paper weight of less than 86 GSM, and a height of less than 11.5 inches; and
• Paper sacks or bags (i) with non-paper handles made wholly of woven ribbon or other similar woven fabric20 and (ii) that are finished with folded tops or for which tied knots or t-bar aglets (made of wood, metal, or plastic) are used to secure the handles to the bags.

The above-referenced dimensions are provided for paper bags in the opened position. The height of the bag is the distance from the bottom fold edge to the top edge ( i.e., excluding the height of handles that extend above the top edge). The depth of the bag is the distance from the front of the bag edge to the back of the bag edge (typically measured at the bottom of the bag). The width of the bag is measured from the left to the right edges of the front and back panels (upon which the handles typically are located).

This merchandise is currently classifiable under Harmonized Tariff Schedule of the United States (HTSUS) subheadings 4819.30.0040 and 4819.40.0040. The HTSUS subheadings are provided for convenience and customs purposes only; the written description of the scope is dispositive.