Antidumping and countervailing duty petition against imports of certain Chinese mobile access equipment and subassemblies: Consequences for exporters and US importers

The Coalition of American Manufacturers of Mobile Access equipment, a US industry trade group comprised of JLG Industries, Inc. and Terex Corporation, filed a petition on February 26, 2021, with the US Department of Commerce (DOC) and the US International Trade Commission (ITC) alleging that certain mobile access equipment and subassemblies thereof (mobile access equipment) from China are being sold in the United States at less than fair value. The petition additionally alleges that the government of China is providing unfair subsidies to producers and exporters of the product in China. The petitioner seeks the imposition of antidumping (AD) and countervailing duties (CVD) on imports of mobile access equipment from China, alleging dumping margins of 86.56 percent.

Under US law, a domestic industry can petition the government to initiate an AD investigation to determine whether an imported product is sold in the United States at less than fair value (ie, dumped).  A domestic industry may also seek the initiation of a CVD investigation into alleged subsidization of foreign producers or exporters by a foreign government. Additional duties may be imposed if the DOC determines that imported goods are dumped and/or unfairly subsidized and if the ITC determines that the domestic industry is materially injured or threatened with such injury by reason of the subject imports.

Products covered by the petition

The product covered by the petition is mobile access equipment, which consists primarily of boom lifts, scissor lifts, and material telehandlers and subassemblies thereof. Mobile access equipment combines a mobile (self-propelled or towed) chassis, with a direct, mechanically connected device for lifting persons, tools and/or materials, capable of reaching a working height of ten feet or more, and a coupler that provides an attachment point for the lifting device, in addition to other components. The scope of the petition covers mobile access equipment and subassemblies thereof whether finished or unfinished, whether assembled or unassembled, and whether the equipment contains any additional features that provide for functions beyond the primary lifting function.

Subject merchandise includes, but is not limited to, the following subassemblies:

• Scissor arm assemblies, or scissor arm sections, for connection to chassis and platform assemblies, including pin assemblies that connect sections into scissor arm assemblies and actuators powering arm assemblies to extend and retract, and which may or may not include blocks that allow sliding of end sections in relation to frame and platform, hydraulic hoses, and/or electrical cables
• Boom assemblies, or boom sections, for connection to the boom turntable or chassis assemblies and to platform assemblies or the lifting device, including telescoping sections where the smallest section (tube) can be nested in the next larger section (tube) and can slide out for extension and/or articulated sections joined by pins, and which may or may not include pins, hydraulic cylinders, hydraulic hoses and/or electrical cables
• Chassis assemblies, for connection to scissor arm assemblies or boom assemblies and/or boom turntable assemblies, including chassis frame or frame sections, and which may or may not include axles, wheel end components, steering cylinders, engine assembly, transmission, drive shafts, tires and wheels, crawler tracks and wheels, fuel tank, hydraulic oil tank, and/or battery assemblies and/or
• Boom turntable assemblies, for connection to chassis assemblies and boom assemblies, including turntable frame, and which may or may not include engine assembly, slewing rings, fuel tank, hydraulic oil tank, battery assemblies, counterweight, and/or hood (enclosure).

The petition states that importation of any of these subassemblies, whether assembled or unassembled, constitutes unfinished mobile access equipment for purposes of this investigation.

Processing of finished and unfinished mobile access equipment and subassemblies such as trimming, cutting, grinding, notching, punching, slitting, drilling, welding, joining, bolting, bending, beveling, riveting, minor fabrication, galvanizing, painting, coating, finishing, assembly, or any other processing either in the country of manufacture of the in-scope product or in a third country does not remove the product from the scope.  Inclusion of other components not identified as comprising the finished or unfinished mobile access equipment does not remove the product from the scope.

The scope excludes forklifts, mobile self-propelled cranes and motor vehicles that incorporate a scissor arm assembly or boom assembly.  Forklifts are material handling vehicles with a working attachment, usually a fork, lifted along a vertical guide rail with the operator seated or standing on the chassis behind the vertical mast.  Self-propelled cranes are intended to solely handle loads suspended on ropes, cables and/or chains and have winches mounted on or near the base of the boom with ropes, cables and/or chains managed along the boom structure.  The scope also excludes motor vehicles (defined as a vehicle driven or drawn by mechanical power and manufactured primarily for use on public streets, roads, and highways, but does not include a vehicle operated only on a rail line pursuant to 49 U.S.C. § 30102(a)(7)) that incorporate a scissor arm assembly or boom assembly.

Certain mobile access equipment within the scope of the petition is typically classifiable under subheadings 8427.10.8020, 8427.10.8030, 8427.10.8070, 8427.10.8095, 8427.20.8020, and 8427.20.8090 of the Harmonized Tariff Schedule of the United States (HTSUS). Parts of certain mobile access equipment are typically classifiable under subheading 8431.20.0000 of the HTSUS.

The value of US imports of mobile access equipment from China was $203.8 million in 2020.

Foreign producers and US importers of mobile access equipment from China

The petition identifies 19 exporters and 35 US importers of mobile access equipment from China. See the lists of exporters and importers from the petition.

Estimated schedule of investigations

AD and CVD proceedings are conducted pursuant to a strict statutory time schedule.  Below is an estimated schedule for the AD and CVD investigations on mobile access equipment from China.

2/26/2021 – Petition filed

4/12/2021 – ITC preliminary injury determination

5/24/2021 – DOC preliminary CVD determination, if not postponed

7/26/2021 – DOC preliminary CVD determination, if fully postponed

8/5/2021 – DOC preliminary AD determination, if not postponed

9/24/2021 – DOC preliminary AD determination, if fully postponed

2/14/2022 – DOC final AD and CVD determinations, if both preliminary and final determinations are fully postponed

3/30/2022 – ITC final injury determinations, if DOC’s determinations are fully postponed

4/6/2022 – AD/CVD orders published

Consequences for exporters and US importers

US AD and CVD investigations can result in the imposition of substantial duties, in addition to other already applicable duties and tariffs.  If the ITC and DOC make affirmative preliminary determinations, US importers will be required to post cash deposits corresponding to the ad valorem AD and/or CVD duty rates determined for the subject merchandise on or after the date when the DOC’s preliminary determination is published in the Federal Register.  In certain circumstances, such duty deposit requirements can go into effect retroactively, 90 days prior to the date of publication.  The AD and CVD duties will remain in effect if the DOC and ITC make affirmative final determinations.

The DOC calculates specific AD and CVD margins for certain individual producers and exporters selected for examination.  Such rates often can be much lower than those alleged in the petition.  However, producers and exporters that do not participate in the investigations may be subject to substantially higher margins.  Duties imposed at these higher margins may force exporters to stop shipping to the United States and importers to cease importation of subject merchandise.  Thus, interested parties – including foreign producers, exporters and importers – may consider having a strategy for addressing AD and CVD investigations, including possible participation.

Under the statutory time schedule for AD and CVD investigations, the first decision (the preliminary ITC determination whether there is a reasonable indication that the US industry is materially injured or threatened with material injury by reason of the subject imports) must be made within 45 days after the filing of the petition.  An ITC hearing (ie, a public conference) is held about 21 to 23 days after the filing date.  As a result, agency staff work begins almost immediately.  Thus, a quick response is essential to understand the specific implications of these developments and to prepare and implement a pertinent strategy.

To learn more, please contact any of the authors.