91 FR 46401 · published 2026-07-23
· Commerce Department, International Trade Administration
Mirrored from the Federal Register (retrieved 2026-08-08) —
the official copy is at federalregister.gov
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The U.S. Department of Commerce (Commerce) preliminarily determines that countervailable subsidies are being provided to producers and exporters of certain fatty acids (fatty acids) from Malaysia. The period of investigation is January 1, 2025, through December 31, 2025. Interested parties are invited to comment on this preliminary determination.
[Federal Register Volume 91, Number 140 (Thursday, July 23, 2026)]
[Notices]
[Pages 46401-46404]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2026-14870]
DEPARTMENT OF COMMERCE
International Trade Administration
[C-557-835]
Certain Fatty Acids From Malaysia: Preliminary Affirmative
Countervailing Duty Determination and Alignment of Final Determination
With Final Antidumping Duty Determination
AGENCY: Enforcement and Compliance, International Trade Administration,
Department of Commerce.
SUMMARY: The U.S. Department of Commerce (Commerce) preliminarily
determines that countervailable subsidies are being provided to
producers and exporters of certain fatty acids (fatty acids) from
Malaysia. The period of investigation is January 1, 2025, through
December 31, 2025. Interested parties are invited to comment on this
preliminary determination.
DATES: Applicable July 23, 2026.
FOR FURTHER INFORMATION CONTACT: Brandon James or Rachel Accorsi, AD/
CVD Operations, Office VIII, Enforcement and Compliance, International
Trade Administration, U.S. Department of Commerce, 1401 Constitution
Avenue NW, Washington, DC 20230; telephone: (202) 482-7472 or (202)
482-3149, respectively.
SUPPLEMENTARY INFORMATION:
Background
This preliminary determination is made in accordance with section
703(b) of the Tariff Act of 1930, as amended (the Act). Commerce
published the notice of initiation of this investigation on March 13,
2026.\1\ On April 29, 2026, Commerce postponed the preliminary
determination of this investigation and the revised deadline is now
July 17, 2026.\2\ For a complete description of the events that
followed the initiation of this investigation, see the Preliminary
Decision Memorandum.\3\ A list of topics discussed in the Preliminary
Decision Memorandum is included as Appendix II to this notice. The
Preliminary Decision Memorandum is a public document and is on file
electronically via Enforcement and Compliance's Antidumping and
Countervailing Duty Centralized Electronic Service System (ACCESS),
which is available to registered users at https://access.trade.gov. In
addition, a complete version of the Preliminary Decision Memorandum can
be accessed directly at https://access.trade.gov/frnotices.
\1\ See Certain Fatty Acids From Indonesia and Malaysia:
Initiation of Countervailing Duty Investigations, 91 FR 12342 (March
13, 2026) (Initiation Notice).
\2\ See Certain Fatty Acids from Indonesia and Malaysia:
Postponement of Preliminary Determinations in the Countervailing
Duty Investigations, 91 FR 23061 (April 29, 2026).
\3\ See Memorandum, ``Decision Memorandum for the Preliminary
Affirmative Determination in the Countervailing Duty Investigation
of Certain Fatty Acids from Malaysia,'' dated concurrently with, and
hereby adopted by, this notice (Preliminary Decision Memorandum).
Scope of the Investigation
The products covered by this investigation are fatty acids from
Malaysia. For a complete description of the scope of this
investigation, see Appendix I.
Scope Comments
In accordance with the Preamble to Commerce's regulations,\4\ the
Initiation Notice set aside a period of time for parties to raise
issues regarding product coverage, (i.e., scope).\5\ Certain interested
parties commented on the scope of the investigation as it appeared in
the Initiation Notice. Commerce intends to issue its preliminary
decision regarding comments concerning the scope of the less-than-fair-
value (LTFV) and countervailing duty (CVD) investigations on or before
the preliminary determinations of the companion Indonesia and Malaysia
LTFV investigations.
\4\ See Antidumping Duties; Countervailing Duties, Final Rule,
62 FR 27296, 27323 (May 19, 1997) (Preamble).
\5\ See Initiation Notice, 91 FR at 12343.
Methodology
Commerce is conducting this investigation in accordance with
section 701 of the Act. For each of the subsidy programs found
countervailable, Commerce preliminarily determines that there is a
subsidy, i.e., a financial contribution by an ``authority'' that gives
rise to a benefit to the recipient, and that the subsidy is
specific.\6\ Commerce notes that, in making these findings, it relied,
in part, on facts available and, because it finds that one or more
respondents did not act to the best of their ability to respond to
Commerce's requests for information, it drew an adverse inference where
appropriate in selecting from among the facts otherwise available.\7\
For further information, see the ``Use of Facts Otherwise Available and
Adverse Inferences'' section in the Preliminary Decision Memorandum.
\6\ See sections 771(5)(B) and (D) of the Act regarding
financial contribution; section 771(5)(E) of the Act regarding
benefit; and section 771(5A) of the Act regarding specificity.
\7\ See sections 776(a) and (b) of the Act.
Alignment
As noted in the Preliminary Decision Memorandum, in accordance with
section 705(a)(1) of the Act and 19 CFR 351.210(b)(4), Commerce is
aligning the final CVD determination in this investigation with the
final determination in the companion LTFV investigation of fatty acids
from Malaysia based on a request made by Vantage Specialty Chemicals,
Inc. (the petitioner).\8\ Consequently, the final CVD determination
will be issued on the same date as the final LTFV determination, which
is currently scheduled to be issued no later than November 30, 2026,
unless postponed.
\8\ See Petitioner's Letter, ``Petitioner's Request to Align
Final Countervailing Duty Determinations with the Companion
Antidumping Duty Final Determinations,'' dated July 1, 2026.
All-Others Rate
Sections 703(d) and 705(c)(5)(A) of the Act provide that in the
preliminary determination, Commerce shall determine an estimated all-
others rate for companies not individually examined. This rate shall be
an amount equal to the weighted average of the estimated subsidy rates
established for those companies individually examined, excluding any
zero and de minimis rates and any rates based entirely under section
776 of the Act.
In this investigation, Commerce calculated individual estimated
countervailable subsidy rates for Evyap Sabun Malaysia Sdn Bhd (Evyap)
and Palm-Oleo Sdn Bhd. (Palm-Oleo) that are not zero, de minimis, or
based entirely on facts otherwise available. Commerce calculated the
all-others rate using a weighted average of the individual estimated
subsidy rates calculated for the examined respondents using each
company's publicly-ranged values for the merchandise under
consideration.\9\
\9\ With two respondents under examination, Commerce normally
calculates: (A) a weighted-average of the estimated subsidy rates
calculated for the examined respondents; (B) a simple average of the
estimated subsidy rates calculated for the examined respondents; and
(C) a weighted-average of the estimated subsidy rates calculated for
the examined respondents using each company's publicly-ranged U.S.
sale values for the merchandise under consideration. Commerce then
compares (B) and (C) to (A) and selects the rate closest to (A) as
the most appropriate rate for all other producers and exporters. See
19 CFR 351.109(f)(2)(ii). As complete publicly ranged sales data
were available, Commerce based the all-others rate on the publicly
ranged sales data of the mandatory respondents. For a complete
analysis of the data, see the All-Others Rate Calculation
Memorandum.
Preliminary Determination
Commerce preliminarily determines that the following estimated
countervailable subsidy rates exist:
Subsidy rate
Company (percent ad
valorem)
Evyap Sabun Malaysia Sdn Bhd............................ 4.40
Palm-Oleo Sdn Bhd.\10\.................................. 4.19
All Others.............................................. 4.32
Suspension of Liquidation
\10\ As discussed in the Preliminary Decision Memorandum,
Commerce has found the following companies to be cross-owned with
Palm-Oleo: Kuala Lumpur Kepong Berhad; KL-Kepong Oleomas Sdn Bhd.;
Palm-Oleo (Klang) Sdn Bhd.; KL-Kepong Industrial Holdings Sdn Bhd.;
Fajar Palmkel Sdn Berhad; and KLK Alami Edible Oils Sdn Bhd.
In accordance with section 703(d)(2) of the Act, Commerce will
direct U.S. Customs and Border Protection (CBP) to suspend liquidation
of entries of subject merchandise as described in the scope of the
investigation section entered, or withdrawn from warehouse, for
consumption on or after the date of publication of this notice in the
Federal Register. Further, pursuant to section 703(d)(1)(B) of the Act
and 19 CFR 351.107(e), Commerce will instruct CBP to require a cash
deposit equal to the estimated company-specific countervailable subsidy
rate or the estimated all-others rate, as follows: (1) the cash deposit
rate for the respondents listed above will be equal to the company-
specific estimated individual countervailable subsidy rates determined
in this preliminary determination; (2) if both the producer and
exporter of the subject merchandise have company-specific estimated
subsidy rates determined in this preliminary determination, and their
rates differ, then the applicable cash deposit rate will be the higher
of these two rates; (3) if either the producer or the exporter, but not
both, of the subject merchandise have a company-specific estimated
subsidy rate determined in this preliminary determination, the
applicable cash deposit rate will be that company's company-specific
rate; and (4) the cash deposit rate for all other producers and
exporters will be equal to the estimated all-others subsidy rate.
Disclosure
Commerce intends to disclose its calculations performed to
interested parties in this preliminary determination within five days
of its public announcement, or if there is no public announcement,
within five days of the date of this notice in accordance with 19 CFR
351.224(b).
Consistent with 19 CFR 351.224(e), Commerce will analyze and, if
appropriate, correct any timely allegations of significant ministerial
errors by amending the preliminary determination. However, consistent
with 19 CFR 351.224(d), Commerce will not consider incomplete
allegations that do not address the significance standard under 19 CFR
351.224(g) following the preliminary determination. Instead, Commerce
will address such allegations in the final determination together with
issues raised in the case briefs or other written comments.
Verification
As provided in section 782(i)(1) of the Act, Commerce intends to
verify the information relied upon in making its final determination.
Public Comment
Case briefs or other written comments may be submitted to the
Assistant Secretary for Enforcement and Compliance no later than seven
days after the date on which the last verification report is issued in
this investigation. A timeline for the submission of case briefs and
written comments will be notified to interested parties at a later
date. Rebuttal briefs, limited to issues raised in the case briefs, may
be filed not later than five days after the date for filing case
briefs.\11\ Interested parties who submit case briefs or rebuttal
briefs in this proceeding must submit: (1) a table of contents listing
each issue; and (2) a table of authorities.\12\
\11\ See 19 CFR 351.309(d); see also Administrative Protective
Order, Service, and Other Procedures in Antidumping and
Countervailing Duty Proceedings, 88 FR 67069, 67077 (September 29,
2023) (APO and Service Final Rule).
\12\ See 19 351.309(c)(2) and (d)(2).
As provided under 19 CFR 351.309(c)(2)(iii) and (d)(2)(iii), we
request that interested parties provide at the beginning of their
briefs a public, executive summary for each issue raised in their
briefs.\13\ Further, we request that interested parties limit their
executive summary of each issue to no more than 450 words, not
including citations. We intend to use the executive summaries as the
basis of the comment summaries included in the issues and decision
memorandum that will accompany the final determination in this
investigation. We request that interested parties include footnotes for
relevant citations in the executive summary of each issue. Note that
Commerce has amended certain of its requirements pertaining to the
service of documents in 19 CFR 351.303(f).\14\
\13\ We use the term ``issue'' here to describe an argument that
Commerce would normally address in a comment of the Issues and
Decision Memorandum.
\14\ See APO and Service Final Rule.
Pursuant to 19 CFR 351.310(c), interested parties who wish to
request a hearing, limited to issues raised in the case and rebuttal
briefs, must submit a written request to the Assistant Secretary for
Enforcement and Compliance, U.S. Department of Commerce within 30 days
after the date of publication of this notice. Requests should contain
(1) the party's name, address, and telephone number; (2) the number of
participants, and whether any participant is a foreign national; and
(3) a list of the issues to be discussed. If a request for a hearing is
made, Commerce intends to hold the hearing at a time and date to be
determined. Parties should confirm by telephone the date, time, and
location of the hearing two days before the scheduled date.
U.S. International Trade Commission (ITC) Notification
In accordance with section 703(f) of the Act, Commerce will notify
the ITC of its determination. If the final determination is
affirmative, the ITC will determine before the later of 120 days after
the date of this preliminary determination or 45 days after the final
determination whether imports of fatty acids from Malaysia are
materially injuring, or threaten material injury to, the U.S. industry.
Notification to Interested Parties
This determination is issued and published pursuant to sections
703(f) and 777(i) of the Act, and 19 CFR 351.205(c).
Dated: July 17, 2026.
Christopher Abbott,
Deputy Assistant Secretary for Policy and Negotiations, performing the
non-exclusive functions and duties of the Assistant Secretary for
Enforcement and Compliance.
Appendix I
Scope of the Investigation
The merchandise subject to these investigations is certain fatty
acids, which are organic acids made of a hydrocarbon chain with a
carboxylic acid group (i.e., an organic acid that contains a
carboxyl group (-C(=O)-OH) attached to an R-group, sometimes also
written as R-COOH, R-C(O)OH, or R-CO2H) at one end with a carbon
chain length (i.e., the number of carbon atoms in the fatty acid
chain) of C6, C8, C10, C12, C14, C16, or C18, with an iodine value
below 105 g/100 g and with a ratio of free fatty acids to
triglycerides (also known as the ``degree of split'' or DoS) of at
least 97 percent, including single fatty acid (also referred to as
``pure cut''), and blends containing a combination of two or more
carbon chain lengths.
Certain fatty acids covered by the scope range in physical form
from low viscosity liquids to solids. Certain fatty acids are
covered by the scope of these investigations irrespective of whether
they have gone through a distillation process and regardless of acid
content, reactivity, functionality, freeze stability, heat
stability, physical form, viscosity, grade, purity, molecular
weight, or packaging.
Certain fatty acids may contain additives, such as catalysts,
solvents, antioxidants, fire retardants, colorants, pigments,
diluents, thickeners, fillers, softeners, and toughening agents.
The scope includes merchandise matching the above description
that has been processed in a third country, including by
commingling, diluting, introducing or removing additives, or
performing any other processing that would not otherwise remove the
merchandise from the scope of the investigations if performed in the
subject country.
The scope also includes certain fatty acids that are commingled
or blended with certain fatty acids from sources not subject to
these investigations. Only the subject component of such commingled
products is covered by the scope of these investigations.
Certain fatty acids covered by the scope are also commonly
called pure, pure cut, fractionated, or distilled fatty acid or
mixed, mixed cut, or blended fatty acid, with the terms pure, pure
cut, fractionated, and distilled typically referring to specific
single-chain fatty acids that have been separated from a mixed
natural source such as animal fat or vegetable oil using processes
like hydrolysis (the breakdown of fat molecules by water, catalyzed
by acid, base, or enzymes (lipases) to yield glycerol and free fatty
acids), distillation, and crystallization, and the terms mixed or
mixed cut referring to combinations, blends or mixtures of different
single-chain fatty acids also derived from a natural source such as
animal fat or vegetable oil using processes like hydrolysis,
distillation, and crystallization. Common names for pure, pure cut,
fractionated, or distilled fatty acids forms include stearic acid
and oleic acid. Common names for mixed or mixed cut fatty acids
include coconut fatty acid, hardened coconut fatty acid, topped
coconut fatty acid, topped hardened coconut fatty acid, palm kernel
fatty acid, hardened palm kernel fatty acid, topped palm kernel
fatty acid, topped hardened palm kernel fatty acid, palm fatty acid,
palm stearin fatty acid, palm fatty acid distillate, and palm olein
fatty acid.
Certain fatty acids covered by the scope are normally associated
with Chemical Abstracts Service (CAS) registry numbers 57-11-4,
112-80-1, 61790-38-3, 67701-05-7, 67701-06-8, 67707-01-3, 68938-15-
8, 101403-98-9, 91771-90-3, 90990-15-1, 68440-15-3, 98106-68-4,
98106-66-2, 90990-08-1, and 90990-08-2 but several others may also
be used.
Specifically excluded from the scope are certain fatty acids
containing 90 percent or more, by weight, of fatty acids with carbon
chain lengths of C6, C8, or C10 (or any combination thereof). The
scope also does not include mixtures of certain fatty acids with
other materials, when the combined certain fatty acids component
comprises less than 80 percent of the total weight of the mixture.
The merchandise is currently classifiable under Harmonized
Tariff Schedule of the United States (HTSUS) subheadings
2915.70.0110, 2915.70.0120, 2915.70.0150, 2915.90.1010,
2915.90.1050, 2916.15.1000, 2916.15.5100, 3823.11.0000,
3823.12.0000, 3823.19.2000, and 3823.19.4000 and may also enter
under 3824.99.4190.
The HTSUS subheadings set forth above are provided for
convenience and customs purposes only. The written description of
the scope is dispositive.
Appendix II
List of Topics Discussed in the Preliminary Decision Memorandum
I. Summary
II. Background
III. Scope Comments
IV. Alignment
V. Injury Test
VI. Diversification of Malaysia's Economy
VII. Use of Facts Otherwise Available and Adverse Inferences
VIII. Subsidies Valuation Information
IX. Benchmarks and Discount Rates
X. Analysis of Programs
XI. Recommendation
[FR Doc. 2026-14870 Filed 7-22-26; 8:45 am]
BILLING CODE 3510-DS-P
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