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Commerce Department Finds Unfair Subsidies on Polyester Fiber from China and India

The U.S. Commerce Department, in preliminary determinations in countervailing duty investigations, found that exporters of fine denier polyester staple fiber from China and India received unfair countervailable subsidies, of between 41.73% and 47.64% in China, and 7.18% to 9.86% in India.

The Commerce Department will instruct U.S. Customs and Border Protection to collect cash deposits from importers of fine denier polyester staple fabric from China and India based on these preliminary rates.

In the China investigation, Commerce has calculated preliminary subsidy rates of 41.73% for Jiangyin Hailun Chemical Fiber Co. Ltd. and 47.64% for Jiangyin Huahong Chemical Fiber Co. Ltd. Commerce has determined a rate of 44.695% for all other Chinese producers and exporters.

In the India investigation, Commerce calculated has calculated preliminary subsidy rates of 7.18% for Bombay Dyeing & Mfg. Co. Ltd. and 9.86% for Reliance Industries Ltd. Commerce has determined a rate of 9.37% for all other Indian producers and exporters.

Imports from companies that receive unfair subsidies from their governments in the form of grants, loans, equity infusions, tax breaks and production inputs are subject to “countervailing duties” aimed at directly countering those subsidies.

The CVD law provides U.S. businesses and workers with a transparent, quasi-judicial and internationally accepted mechanism to seek relief from the market-distorting effects caused by injurious dumping and unfair subsidization of imports into the U.S., establishing an opportunity to compete on a level playing field.

For the purpose of CVD investigations, a countervailable subsidy is financial assistance from a foreign government that benefits the production of goods from foreign companies and is limited to specific enterprises or industries, or is contingent either upon export performance or the use of domestic goods over imported goods.

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In 2016, imports of fine denier polyester staple fiber from China and India were valued at an estimated $79.4 million and $14.8 million, respectively.

The petitioners are DAK Americas LLC of Charlotte, North Carolina; Nan Ya Plastics Corp. America of Lake City, South Carolina, and Auriga Polymers Inc. of Spartanburg, North Carolina.

[Read more about Commerce investigations: US Commerce Dept. Begins Antidumping Investigations Into PET Imports From Five Countries]

Unless the final determinations are aligned with concurrent investigations, Commerce is scheduled to announce its final CVD determinations on Jan. 16.

If the department makes affirmative final determinations of subsidization and the U.S. International Trade Commission makes affirmative final injury determinations, Commerce will issue the CVD orders. If Commerce makes negative final determinations of subsidization or the ITC makes negative final determinations of injury, the investigations will be terminated and no order will be issued.

The Commerce Department’s Enforcement and Compliance unit within the International Trade Administration is responsible for vigorously enforcing U.S. trade laws and does so through an impartial, transparent process that abides by international rules and is based solely on factual evidence.

From Jan. 20 through Oct. 31, Commerce has initiated 77 anti-dumping and CVD investigations, a 60 percent increase over the previous year. Commerce currently maintains 411 AD and CVD duty orders that provide relief to American companies and industries impacted by unfair trade.