New AD/CVD Petitions: Hard Empty Capsules from Brazil, China, India, and Vietnam - Harris Sliwoski LLP

Home | China Law Blog | New AD/CVD Petitions: Hard Empty Capsules from Brazil, China, India, and Vietnam

Adams Lee

On October 24, 2024, new antidumping (AD) and countervailing duty (CVD) petitions were filed against imports of Hard Empty Capsules from Brazil, China, India and Vietnam. Hard Empty Capsules (HEC) are unfilled cylindrical shells (usually gelatin based) that are used to hold pharmaceutical or nutraceutical products.

The petition was filed by Lonza Greenwood LLC, which is the U.S. affiliate of the Lonza Group which is headquartered in Switzerland. The Lonza Group has HEC production facilities in Belgium, China, France, India, Indonesia, Mexico, and Japan, in addition to the United States.

These AD/CVD investigations will be conducted by two federal agencies. The International Trade Commission (“ITC”) will investigate whether the subject imports have materially retarded the establishment of the domestic industry. The U.S. Department of Commerce (“DOC”) will investigate whether the subject imports are being sold to the United States at less than fair value (“dumping”) or benefit from unfair government subsidies. Both agencies have to make affirmative findings of material retardation (ITC) or of dumping or subsidies (DOC) in order for AD/CVD duties to be imposed on the subject imports.

Scope

The merchandise subject to the scope of this investigations is hard empty capsules (HECs), which are unfilled cylindrical shells composed of at least 80 percent by weight of a non-toxic, biodegradable, biocompatible, and water soluble polymer, and may also contain water, additives, opacifiers, colorants, and processing aids. HECs may also be imprinted or otherwise decorated with markings.

See here for a full description of the proposed scope definition

Alleged AD/CVD Margins.

Petitioner calculated the following estimated dumping margins

Brazil: 78.43% – 98.74%

China: 136.51% – 170.91%

India: 57.50% – 86.34%

Vietnam: 65.97% – 89.33%

Petitioner did not provide any specific subsidy margin calculations.

Named Exporters/ Producers

Petitioner included a list of companies that it believes are producers and exporters of the subject merchandise. See attached list of HEC exporters here.

Named U.S. Importers

Petitioner included a list of companies that it believes are U.S. importers of the subject merchandise. See attached list of HEC importers here.

Estimated Schedule of Investigations.

October 24, 2024 – Petitions filed

November 13, 2024 – DOC initiates investigation

November 14, 2024 – ITC Staff Conference

November 6, 2024 – ITC preliminary determination

March 23, 2025 – DOC CVD preliminary determination (assuming extended deadline) (1/17/25 – unextended)

May 22, 2025 – DOC AD preliminary determination (assuming extended deadline) (4/2/25 – unextended)

October 4, 2025 – DOC final determination (extended)

November 18, 2025 – ITC final determination (extended)

November 25, 2025 – DOC AD/CVD orders issued (extended)

Adams Lee

Adams Lee has more than twenty years’ experience providing strategic advice and legal guidance on complex international trade and administrative regulatory matters to US and foreign companies, trade associations, and foreign governments. He advises companies in a broad range of industries on international trade remedy and trade policy issues.Adams brings a wealth of knowledge to Harris Sliwoski’s international trade practice. He is adept at quickly evaluating strategic options and developing the best comprehensive legal approach in light of relevant policy and case law. Beyond achieving significant DOC and ITC results that improve his clients’ competitive position, Adams helps them understand complex trade issues so they can make well-informed business decisions.

Stay up to date with news and insights on China Law by subscribing to the blog

Δ