The U.S. Department of Commerce has agreed to narrow the scope of its tariff investigation into passenger and light truck tires, removing a few categories of tires from the weight of any tariffs for imports from South Korea, Taiwan, Thailand and Vietnam.
Specifically, the DOC has agreed to exclude these tires from the case:
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Temporary spare tires for light trucks
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Tires for all-terrain vehicles (ATVs) and utility-terrain vehicles (UTVs)
The change comes as the DOC has issued its preliminary finding that PLT tires from the four regions should be subject to anti-dumping tariffs. The DOC, and the International Trade Commission, both will continue with their investigations, and final results are expected later in 2021.
From the outset of every tariff investigation, the DOC sets a proper, specific definition of the products that are at the center of its case. It’s referred to as the “scope of the investigation.” For this current investigation, the definition of PLT tires, and the tires that are excluded from the tariff order, stretches across four pages of text. (The definition and description of those LT spare tires is more than 100 words by itself. It includes things like the required markings on the sidewall and specific sizes. The definition for ATV and UTV tires is even longer, with 15 specific tire sizes listed.)
As different parties join the case to make arguments and provide data, they have the opportunity to comment on that scope. It’s been common in the tire investigations for tiremakers to try to narrow the scope, or have it more clearly defined.
These other parties can even catch typos in the original definition — Cheng Shin Rubber Ind. Co. Ltd. (dba Maxxis International — USA) spotted a single letter that was incorrect in the description of spare tires for passenger vehicles. (Those are excluded from tariffs, too.)
Cheng Shin was also the company that made the case to add light truck spare tires to the list of excluded products.
Deestone Corp. Ltd. successfully petitioned to remove ATV and UTV tires from the investigation using these four points:
- Due to ATV/UTV tires’ different sizes, lower speed ratings and lower load capacity, consumers don’t use these tires on passenger vehicles or light trucks.
- Certain ATV/UTV tires “are unfit for passenger vehicles and light trucks use due to safety concerns.”
- Since the tires are designed for ATVs and UTVs, they don’t have a “P” or “LT” marking on their sidewalls.
- The United Steelworkers didn’t specify Carlstar, the only U.S. producer of ATV/UTV tires, to be a domestic producer of PLT tires in its petition.
The union didn’t object to modifying the scope to exclude ATV and UTV tires, and the DOC ultimately agreed, noting it seemed like an “appropriate” move “because it aligns with the intent of the petitioner.”
Not every request is granted
That doesn’t mean every effort by a tiremaker to change the scope is successful. Atturo Tire Corp. and Brand Inc. both sought to exclude certain off-road tires. Atturo’s argument was centered on off-road tires for racing. Brand wanted mud-terrain tires with M or N speed ratings excluded. The DOC said no to those requests.
And in its explanation, the DOC notes that whether or not the petitioner — the USW — agrees with the request is an important part of the equation. It is the DOC’s “practice of providing ample deference to the petitioner with respect to the definitions of the product for which it seeks relief.”
Remember, these cases are filed because the petitioner says its domestic industry is being harmed by imports from the stated regions.
The DOC wrote, “As the party alleged to be harmed by dumping and subsidization in these investigations, the petitioner is uniquely situated to opine on the definition of merchandise that is subject to the investigations.”
In another spot the DOC noted it had the authority to clarify or modify the scope “to make it administrable/enforceable or to prevent potential evasion, we generally seek to exercise that authority in a manner that reflects the intent of the petitioner.”
