FAS 2020 UP1: Carbon steel fasteners
Conclusion of normal value review

Ottawa,

The Canada Border Services Agency (CBSA) has today concluded a normal value review (review) to determine normal values and export prices of certain carbon steel fasteners (fasteners) exported to Canada from the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu (Chinese Taipei) by Jau Yeou Industry Co., Ltd. (Jau Yeou).

The review follows requests for re‑determination filed by importers and is part of the CBSA’s enforcement of the Canadian International Trade Tribunal’s (CITT) order issued on September 2, 2020 in Expiry Review No. RR‑2019‑002, respecting the dumping of fasteners originating in or exported from the People’s Republic of China (China) and Chinese Taipei, and the subsidizing of such goods, originating in or exported from China, excluding fasteners specifically designed for application in the automotive or aerospace industry, in accordance with the Special Import Measures Act (SIMA).

The product definition and the applicable tariff classification numbers of the goods subject to the CITT’s order are contained in Appendix 1 (subject goods).

Period of investigation

For this review, the Period of Investigation (POI) was from April 1, 2019 to September 30, 2020 and the Profitability Analysis Period (PAP) was from January 1, 2019 to September 30, 2020.

Normal value review process

At the initiation of this review, on October 13, 2020, the CBSA sent Requests for Information (RFIs) to Jau Yeou and to other parties involved in the transactions in order to solicit information on the costs and selling prices of subject goods and like goods. The information was requested for purposes of determining normal values and export prices applicable to subject goods exported to Canada.

The responses to the CBSA’s RFIs, Supplemental RFIs and deficiency letter were received accordingly from Jau Yeou, Hilti Corporation Liechtenstein (Hilti AG), Six‑2 Fastener Imports Inc. (Six‑2 Fastener) and Hilti Canada Corporation (Hilti Canada).

As part of the review, counsel on behalf of Leland Industries Inc. (Leland), a Canadian producer, submitted comments on the submissions filed by Jau Yeou prior to the close of the record as well as a case brief. Reply submissions were submitted by Jau Yeou and by counsel on behalf of Hilti Canada and Hilti AG (collectively, Hilti).

The issues raised in the commentsFootnote 1 and case briefFootnote 2 submitted on behalf of Leland concerned the deficiencies and completeness of Jau Yeou’s responses. Other representations made by Leland include: the outsourcing of production processes to subcontractors and whether Jau Yeou is the producer of the subject goods, the presence of export sales by Jau Yeou which were not made at arm’s length as the parties are associated persons and the distorted input costs of Jau Yeou which support the existence of a particular market situation (PMS).

In its reply submission,Footnote 3 Jau Yeou submitted that for the production of fasteners at its own factory and in instances where it employs the services of subcontractors, it was the owner of the raw materials, the semi‑finished goods and the finished goods throughout the entire production process and therefore the producer of the subject goods sold to Canada during the POI. Jau Yeou also stated that none of its raw material suppliers was a state‑owned enterprise and argued that its input costs were not distorted due to any PMS. Lastly, Jau Yeou indicated that none of its Canadian customers are associated companies and as such, its transactions with its Canadian customers during the POI were at arm’s length.

In its reply submission,Footnote 4 counsel for Hilti indicated that if Leland’s case brief has alleged that Jau Yeou and any Hilti AG and/or Hilti Canada are associated persons with Jau Yeou, it disputed such claim that Jau Yeou and Hilti are associated within the meaning of SIMA. Furthermore, counsel for Hilti submitted that Jau Yeou is simply one of the many suppliers and the parties are dealing with each other at arm’s length in relation to the subject goods.

The representations submitted by all parties were given due consideration by the CBSA prior to the conclusion of this review.

Normal values for future shipments

Jau Yeou did not have any domestic sales of like goods during the PAP to determine normal values in accordance with section 15 of SIMA.

Jau Yeou provided sufficient cost of production and administrative, selling and all other costs to determine normal values pursuant to paragraph 19(b) of SIMA. However, the CBSA was unable to determine an amount for profits under paragraph 11(1)(b) of the Special Import Measures Regulations.

As such, normal values were determined pursuant to section 29 of SIMA using a method similar to that of paragraph 19(b), based on the aggregate of cost of production of the goods, a reasonable amount for administrative, selling and all other costs, and a reasonable amount for profits determined by ministerial specification.

Normal values for future shipments of fasteners have been determined for Jau Yeou. These normal values are effective today, April 29, 2021.

For the subject goods exported by Jau Yeou to Canada, export prices are determined in accordance with section 24 of SIMA.

The normal values and export prices determined as a result of this review may be applied to any requests for re‑determination of importations of subject goods that have not been processed prior to the conclusion of this review, regardless of the date that the requests were received. The normal values and export prices determined as a result of this review may be applied retroactively where the conditions described below are met.

Exporter responsibility

Please note that exporters with normal values are required to promptly inform the CBSA in writing of changes to domestic prices, costs, market conditions or terms of sale associated with the production and sales of the goods. If there are changes to the exporter’s domestic prices, costs, market conditions or terms of sale associated with the production and sales of the goods, and where the CBSA considers such changes to be significant, the normal values and export prices will be updated to reflect current conditions. All parties are cautioned that where there are increases in domestic prices, and/or costs as noted above, the export price should be increased accordingly to ensure that any sale made to Canada is not only above the normal value but at or above selling prices and full costs and profit of the goods in the exporter’s domestic market. If exporters do not properly notify the CBSA of any such changes, do not adjust export prices accordingly, or do not provide the information required to make any necessary adjustments to normal values and export prices, retroactive assessments will be applied where such action is warranted.

Importer responsibility

Importers are reminded that it is their responsibility to calculate and declare their anti‑dumping duty liability. If importers are using the services of a customs broker to clear importations, the brokerage firm should be advised that the goods are subject to SIMA measures and be provided with sufficient information necessary to clear the shipments. To determine their anti‑dumping liability, importers should contact the exporter(s) to obtain the applicable normal values. For further information on this matter, refer to Memorandum D14‑1‑2, disclosure of normal values, export prices, and amounts of subsidy established under the Special Import Measures Act.

The Customs Act (Act) applies, with any modifications that the circumstances require, with respect to the accounting and payment of anti‑dumping duties. As such, failure to pay the duties within the prescribed time will result in the application of the interest provisions of the Act.

Should the importer disagree with the determination made on any importation of goods, a request for re‑determination may be filed. For more information on how to file a request for re‑determination, please refer to the Guide for appealing a duty assessment.

Information

Any questions concerning the above should be directed to:

Email: SIMA_Disclosure_and_Registry_Unit@cbsa-asfc.gc.ca

Appendix 1—Product definition

Subject goods definition

“Certain carbon steel fasteners originating in or exported from the People's Republic of China and the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu (Chinese Taipei), excluding fasteners specifically designed for application in the automotive or aerospace industry.”

The following table is a list of subject products included in the Canadian International Trade Tribunal's (CITT) findings/orders for certain carbon steel fasteners.

Fastener Imperial Metric
  Diameter Length Diameter Length
Wood Screws #4 to #24
(0.112" to 0.386")		 3/8 to 8 in. M3 to M10 10 mm to 200 mm
Square and Hex Lag Screws #14 to #24
(1/4" to 0.386")		 3/4 to 4 in. M6 to M10 20 mm to 100 mm
Sheet Metal/Tapping Screws #4 to #24
(0.112" to 0.386")		 3/8 to 8 in. M3 to M10 10 mm to 200 mm
Thread Forming Screws #4 to #24
(0.112" to 0.386")		 3/8 to 3 in. M3 to M10 10 mm to 75 mm
Thread Cutting Screws #4 to #24
(0.112" to 0.386")		 3/8 to 3 in. M3 to M10 10 mm to 75 mm
Thread Rolling Screws #4 to #24
(0.112" to 0.386")		 3/8 to 3 in. M3 to M10 10 mm to 75 mm
Self-drilling Tapping Screws #4 to #24
(0.112" to 0.386")		 3/8 to 3 in. M3 to M10 10 mm to 75 mm
Machine Screws #4 to 3/8 in
(0.112" to 3/8")		 3/8 to 8 in. M3 to M10 10 mm to 200 mm
Flange Screws 1/4 to 5/8 in 3/8 to 4 in. M6 to M16 10 mm to 100 mm

The following products are excluded by the CITT in Inquiry No. NQ-2004-005, in Expiry Reviews No. RR-2009-001 and RR-2014-001, and in Interim Reviews No. RD-2016-001 and RD-2016-003 and, therefore, are not subject to anti-dumping duty or countervailing duty.

The following products are excluded by the CITT's in Expiry Review No. RR-2019-002 and, therefore, are not subject to anti-dumping duty or countervailing duty.

Additional product information

Tariff classification numbers

The importation of the subject goods are usually classified under the following tariff classification numbers:

  1. 7318.11.00.00
  2. 7318.12.00.00
  3. 7318.14.00.00
  4. 7318.15.00.10
  5. 7318.15.00.49

This listing of tariff classification numbers is for convenience of reference only. Refer to the product definition for authoritative details regarding the subject goods.

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