On March 7, 2019, Cambria Company LLC filed petitions on behalf of the domestic industry with the U.S. Department of Commerce (Commerce) and the U.S. International Trade Commission (Commission) seeking antidumping and countervailing duties on imports of certain quartz surface products from India and Turkey. According to the petitions, quartz surface product imports from these two countries are being sold at less than fair value in the United States and receive countervailable subsidies, causing material injury and threatening further material injury to the U.S. industry if duties are not imposed.
The covered quartz surface products consist of:
Slabs and other surfaces created from a mixture of materials that includes predominately silica (e.g., quartz, quartz powder, cristobalite, glass powder) as well as a resin binder (e.g., an unsaturated polyester). The incorporation of other materials, including, but not limited to, pigments, cement or other additives does not remove the merchandise from the scope of the investigation. However, the scope of the investigation only includes products where the silica content is greater than any other single material, by actual weight. Quartz surface products are typically sold as rectangular slabs with a total surface area of approximately 45 to 60 square feet and a nominal thickness of one, two or three centimeters. However, the scope of this investigation includes surface products of all other sizes, thicknesses and shapes. In addition to slabs, the scope of this investigation includes, but is not limited to, other surfaces such as countertops, backsplashes, vanity tops, bar tops, work tops, tabletops, flooring, wall facing, shower surrounds, fire place surrounds, mantels and tiles. Certain quartz surface products are covered by the investigation whether polished or unpolished, cut or uncut, fabricated or not fabricated, cured or uncured, edged or not edged, finished or unfinished, thermoformed or not thermoformed, packaged or unpackaged, and regardless of the type of surface finish.
In addition, quartz surface products are covered by the investigation whether or not they are imported attached to, or in conjunction with, non-subject merchandise such as sinks, sink bowls, vanities, cabinets and furniture. If quartz surface products are imported attached to, or in conjunction with, such non-subject merchandise, only the quartz surface product is covered by the scope.
The petitions note that covered quartz surface products include material matching the scope description that has been finished, packaged or otherwise fabricated in a third country, including by cutting, polishing, curing, edging, thermoforming, attaching to or packaging with another product, or any other finishing, packaging or fabrication that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the quartz surface products. The products subject to the scope are currently classified in the Harmonized Tariff Schedule of the United States (HTSUS) under the subheading 6810.99.0010. Subject merchandise may also enter under subheadings 6810.11.0010, 6810.11.0070, 6810.19.1200, 6810.19.1400, 6810.19.5000, 6810.91.0000, 6810.99.0080, 6815.99.4070, 2506.10.0010, 2506.10.0050, 2506.20.0010, 2506.20.0080 and 7016.90.10.
The scope of the proposed investigation does not cover quarried stone surface products, such as granite, marble, soapstone or quartzite. Specifically excluded from the scope of the investigations are certain crushed glass surface products.
According to the petitions, imports of the covered quartz surface products have doubled from 2017 to 2018 in volume (from 7,146,422 to 14,675,372 square feet), and nearly doubled in value (from $62,159,496 to $106,062,082). In the petitions, Cambria Company LLC states that it has not yet identified any specific examples of lost sales and revenues due to these imports from India and Turkey but that there should be evidence of such losses at the distributor and fabricator level. As a result, the petitioner claims that unfairly priced quartz surface product imports are having direct, significant adverse effects on the domestic industry, such as price suppression, resulting in lost sales and lost revenue to the U.S. industry.
Regarding countervailable subsidies, the petitions allege that the Indian producers receive subsidies for “Export Oriented Units,” the Export Promotion of Capital Goods Scheme, special financing for exports and participation in Special Economic Zones. For Turkish producers, the alleged subsidies include preferential tax treatment for revenue earned on export sales, numerous preferential credit programs for export sales and preferential loans for investments in export-oriented businesses.
The petitions identify numerous alleged Indian and Turkish producers and exports of the covered products to the United States at allegedly dumped and subsidized prices. The petitions also identify known U.S. importers of the covered quartz surface products from India and Turkey.
Commerce will determine by May 28, 2019, whether to formally initiate the antidumping investigation and countervailing duty investigation and, if Commerce does, the Commission will decide 25 days thereafter whether there is a reasonable indication of existing material injury or threat of material injury to the domestic industry that will require continuation of the investigation.
Thompson Hine is monitoring this matter closely. For additional information or to obtain a copy of the petition, please contact us.