Rulings, remedies and court proceedings for customs and trade professionals

Wheels Made in Thailand From Chinese Rims or Discs Within Chinese AD/CVD Orders, Commerce Says

Trailer wheels manufactured by Asia Wheel in Thailand using discs and rims produced in Thailand from steel plates from China or a third country are not subject to the antidumping and countervailing duty orders on certain steel wheels 12 to 16.5 inches in diameter from China, the Commerce Department said in a scope ruling issued in April.

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Commerce also found that wheels made using both discs from China and rims made in Thailand were within the scope of the orders. Dual wheels made using both discs produced in Thailand from Chinese disc blanks and rims from China were also within the scope of the orders, Commerce said.

Commerce found that the plain language of the scope was ambiguous as to the status of finished wheels processed in a third country from a mix of components sourced from China and outside China. The agency was unconvinced by Asia Wheel's arguments that the plain language made clear that wheels made in a third country from rims or discs from China, but not from both, were outside the scope, saying the argument was "reliant on a mischaracterization of the investigation record."

Commerce performed a substantial transformation analysis and found that the wheels in question were not substantially transformed from their Chinese components. Commerce said the finished wheels remained "of the same class or kind" of product as the Chinese-origin components. The agency also found that although the wheel assembly changed the character and use of the inputs, Asia Wheel did not explain the "essential" qualities imparted by assembly. Commerce also found that several essential qualities like size and placement of holes were predetermined before assembly in Thailand.

Asia Wheel originally asked for the scope ruling in 2020 but did not identify specific model numbers or identify which wheel products were produced using each production method. However, all merchandise within the request would be covered by the scope if manufactured in China due to their size and general characteristics, CBP said.

Commerce considered the issue after a covered merchandise referral from CBP in an Enforce and Protect Act investigation concerning steel wheels imported from Thailand by Vanguard National Trailer Corporation. The agency had already begun a scope inquiry at the request of Asia Wheel for the same merchandise, so Commerce decided to address CBP's covered merchandise referral and Asia Wheel’s scope ruling request together.