Initial China Quartz Tariffs Launched

By Emerson Schwartzkopf

WASHINGTON – The U.S. Department of Commerce placed initial tariffs on quartz-surface imports from China today, with rates ranging from 34.38% to 178.45%.

The new levies, resulting from unfair trade complaints earlier this year from U.S. quartz-surface manufacture Cambria Company LLC, are only half the story, however.

The preliminary determination from the Commerce Department’s International Trade Administration (ITA) only covers “counterveiling” (CV), or practices where Chinese government agencies are deemed to have unfairly subsidized production. The ITA is still investigating antidumping claims of quartz surfaces being sold below market rates, which will likely result in an additional tariff within the next few months.

The preliminary CV tariffs will go into effect upon publication in the Federal Register, the U.S. government’s official journal, which should be in the next few days.

The Commerce Department’s decision means that U.S. Customs and Border Protection officials will collect, in cash, 34.38% of the value of Chinese quartz-surface products coming U.S. ports-of-entry – except from products from Fasa Industrial Corporation Ltd. and Foshan Hero Stone Co, Ltd., where the tariff is 178.45% after more-intense investigation by the ITA.

Customs and Border Patrol will enforce the tariffs on quartz surfaces now being sent to the United States or held in pre-duty facilities.

The action mainly targets quartz-surface slabs, but also includes all premade or blank tops, flooring, wall facing, shower surrounds, fireplace materials tiles and quartz surfaces attached to other furniture or fixtures.

It also includes Chinese-made surfaces that are “finished, packaged, or otherwise fabricated in a third country, including by cutting, polishing, curing, edging, thermoforming, attaching to, or packaging with another product, or any other finishing, packaging, or fabrication that would not otherwise remove the merchandise from the scope of the investigation if performed in the country of manufacture of the quartz-surface products,” according to an Commerce Department fact sheet.

The ITA came up with the 34.38% rate for nearly all Chinese quartz-surface exports based on an investigation of Foshan Yixan Stone Co. Ltd. The U.S. agency determined that companies received backing via corporate-tax relief, Chinese government provision of quartz sand and polyester-resin binder, reduced electrical rates, subsidized bank loans and other non-recurrning grants. The largest share of the rate – 27.79% — is attributed to subsidized polyester resin.

The ITA claimed that Fasa Industrial and Foshan Hero Stone received a wider selection of subsidies that totaled an “adverse facts available” (AFA) rate of 178.45% on exports to the United States.

The Commerce Department will accept comments on the CV action and is scheduled to issue its final determination concerning countervailing subsidies on Jan. 28 next year. If it’s affirmative, the U.S. International Trade Commission (ITC) will be scheduled to make its final injury determination on or about March 14.  If both are affirmative, the Commerce will issue a CVD order.  If Commerce makes a negative final determination or the ITC makes a negative final determination of injury, the investigation will end and no order will be issued.

The tariffs emanating from the unfair-trade petition by Cambria earlier this year are separate from general tariffs on Chinese-made goods proposed in a series of announcements from the Trump administration this summer.

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