Ali quartz notice — The United States Secretary of Commerce has determined that US imports of quartz surface products manufactured in China and processed in Malaysia are subject to antidumping and countervailing duties (“AD/CVD”) orders on Chinese imports.
Malaysia exported zero quartz surface products to the United States in 2018. The following year, after the Commerce Department issued AD/CVD orders on Chinese quartz surface products, Malaysian exports skyrocketed. Malaysian exports had reached a staggering 16 million square feet by 2021. According to available evidence, many of these quartz surface products were manufactured in China and simply transshipped through Malaysia to avoid paying AD/CVD duties.
“In 2018, American quartz manufacturers and their employees gained a victory, when the AD/CVD duties were imposed on illegally dumped and subsidized quartz from China,” said Marty Davis, Cambria’s President and Chief Executive Officer. “This action opened the door for the launching and expansion of U.S. quartz manufacturing factories; total investments since that time will be upwards of $800,000,000 in new US based factories, with 1000’s of new U.S. based jobs. But this Chinese merchandise illegally transshipped through Malaysia puts this and even more future investment in jeopardy.”
On February 7, 2022, the Commerce Department initiated an investigation to determine whether the scope of the AD/CVD orders includes quartz surface products manufactured in China but re-exported from Malaysia. As part of its investigation, the agency distributed questionnaires to Malaysia’s 23 largest exporters of quartz surface products. The Commerce Department received no responses from eight of the companies that received questionnaires. The agency determined in its final scope ruling that these non-responsive companies were exporting to the United States quartz surface products processed in Malaysia using quartz slab manufactured in China. To address transshipment and evasion concerns, the Commerce Department will now require certification for all imports of quartz surface products from Malaysia.
The following is how the certification process will work. If a Malaysian importer of quartz surface products claims that the products should not be subject to AD/CVD duties, the importer must meet certain certification and documentation requirements. First, an exporter of quartz surface products in Malaysia who claims that their quartz surface products were not made with Chinese quartz slabs must prepare and keep certain exporter certifications and supporting documentation on file. Importers of such quartz surface products must also prepare and keep a separate importer certification and supporting documentation on file. If the certification or documentation requirements are not met, the importer must pay the applicable AD/CVD duties on QSP from China. These duties are currently in excess of 300%.
Significantly, the following companies are not eligible for the scope certification process because they did not fully participate in the proceeding:
1. Bada Industries SDN BHD;
2. Ever Stone World SDN BHD;
3. Karina Stone;
4. MSI Building Supply SDN;
5. Principal Safwa (M) SDN;
6. Resstone Manufacturing;
7. SCLM Services SDN BHD;
8. Unique Stone SDN BHD; and
9. Universal Quartz.
“We were shocked at how rapidly exports from Malaysia rushed to fill the gap left by illegally traded imports from China,” said Arik Tendler, Cambria’s Chief Sales Officer. “We have long believed that this Malaysian merchandise is evading the existing AD/CVD orders. We appreciate Commerce Department taking this important step to ensure that the orders are strictly enforced so that Cambria and the entire US domestic quartz manufacturing industry can compete on a level playing field.”
The Commerce Department’s scope inquiry has already had a significant impact in clearing the US market of Chinese goods that were being illegally transshipped through Malaysia to the US in order to avoid paying AD/CVD duties. Following a peak of nearly 1.6 million square feet in March 2022, the month after the scope inquiry was launched, U.S. imports from Malaysia fell to just 136,000 square feet in July 2022.
Source: Cambria