A petition filed May 28 could result in the imposition of antidumping and/or countervailing duties on imports of l-lysine from China.
Scope
Lysine is an amino acid that is added directly to animal feed to promote the biosynthesis of proteins. It is typically produced through fermentation of a strain of bacteria with a supply of dextrose.
The petition covers animal feed-grade lysine regardless of form, purity, or concentration level. It includes lysine that (1) has been coated or encapsulated for use with ruminants to ensure bioavailability and (2) is combined with other products; e.g., by mixing, blending, compounding, or granulating, and (3) has been processed in a third country, including by commingling, diluting, adding or removing additives, refining, converting from liquid to dry or dry to liquid form, or coating or encapsulating.
Covered lysine is currently classifiable under HTSUS subheading 2922.41.0090 and may also be classified under subheadings 2922.41.0010, 2922.49.4950, and 2309.90.9500.
AD/CV Duty Rates
The petition alleges that subject goods are being sold in the U.S. market at less than normal value, specifically at a margin of 197.1 percent.
However, importers are typically liable for the payment of AD duties at the alleged rates only when importing from foreign producers or exporters that fail to cooperate with AD investigations by the Department of Commerce and International Trade Commission. Lower rates are often assigned to imports from cooperative entities.
The petition also argues that subject goods are being subsidized by the government of China but does not assert specific rates.
Next Steps
The Department of Commerce and the International Trade Commission will consider this petition and quickly launch investigations to determine dumping margins/net subsidy rates and potential injury to the U.S. domestic industry, respectively. Preliminary determinations are due around July 17 for the ITC and Aug. 21 (CV) and Nov. 4 (AD) for the DOC, although these dates may be extended.
If these preliminary determinations are affirmative, U.S. importers will be required to post AD and/or CV duty cash deposits for all entries of subject goods entered on or after the date those determinations are published. However, in certain circumstances duties could be owed three months prior to that date. In addition, preliminary cash deposit rates can change in the final DOC determinations.
Many important issues affecting coverage, duty rates, other considerations are argued and decided in the early stages of AD/CV proceedings before preliminary determinations are issued. Companies that strategically engage in these early stages are thus best positioned to protect their interests and mitigate any potential duty liability. For more information, please contact Sandler, Travis & Rosenberg.
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