Conclusion of normal value review: Mattresses (MAT 2023 UP2)

Period of investigation

The period of investigation with respect to dumping (dumping POI), covered all subject goods from October 1, 2022 to September 30, 2023. The period of investigation with respect to subsidizing (subsidy POI), covered all subject goods from April 1, 2022 to September 30, 2023.

Normal value review process

At the initiation of this review, on August 28, 2023, the CBSA sent Requests for Information (RFIs) to Derucci International, the Government of China (GOC) and an importer in order to solicit information on the costs, selling prices of subject goods and like goods, and subsidy programs. The information was requested for purposes of determining normal values, export prices and an amount of subsidy applicable to subject goods exported to Canada.

Following notices of disclosure related deficiencies^{Footnote 1} issued in early February 2024, the CBSA received responses to dumping and subsidy RFIs from: De Rucci Healthy Sleep^{Footnote 2}, Derucci International^{Footnote 3}, and Jiaxing Derucci Smart Home Co., Ltd.^{Footnote 4} (Jiaxing Derucci).

In reviewing the RFI responses received from Jiaxing Derucci, who is a related producer of mattresses, the CBSA found that they were not involved with the production or sales of the subject goods exported to Canada during the POIs. As such, the information was not used for purposes of this review.

The CBSA found the Dumping RFI response submitted by De Rucci Healthy Sleep to be incomplete and issued the first deficiency letter^{Footnote 5} on March 1, 2024, which also included a supplemental request for information (SRFI). De Rucci Healthy Sleep provided a response^{Footnote 6} to that deficiency letter and SRFI on March 11, 2024 which the CBSA found to be incomplete. On March 28, 2024, the CBSA issued a second deficiency letter^{Footnote 7} that also included a second SRFI and asked for the information to be provided in two parts on separate dates. Complete responses^{Footnote 8} to both parts of the second deficiency letter and SRFI were received from De Rucci Healthy Sleep on April 4, 2024 and April 23, 2024.

The CBSA found the Subsidy RFI response submitted by De Rucci Healthy Sleep to be incomplete and issued a deficiency letter^{Footnote 9} on April 15, 2024, which also included a SRFI. De Rucci Healthy Sleep provided a response^{Footnote 10} to that deficiency letter and SRFI on April 24, 2024 which the CBSA found to be complete.

A response to the CBSA’s importer RFI was received from the importer.^{Footnote 11} Additionally, the importer responded to one SRFI.^{Footnote 12}

The GOC did not provide a response to the government subsidy RFI.

The CBSA did not receive any case briefs or reply submissions from interested parties with respect to this review. All of the information submitted on the record was considered for the conclusion of this review.

Normal values and amount of subsidy for future shipments

In analyzing the information submitted by De Rucci Health Sleep and its subsidiary companies provided in this review, the CBSA determined that Derucci International could not be considered, on its own, to be the exporter for SIMA purposes. While Derucci International originally identified itself as the exporter for SIMA purposes, the CBSA found that: Derucci International acted solely as a trading company that is not located in the country of export; Derucci International is a subsidiary of De Rucci Healthy Sleep; the subject goods exported to Canada were produced by De Rucci Healthy Sleep; and the subject goods were shipped directly to the port from De Rucci Healthy Sleep from which they were exported to Canada.^{Footnote 13}

The information provided during the course of the review also showed that De Rucci Healthy Sleep did not sell the mattresses it produced to unrelated customers in the domestic market. Like exports, De Rucci Healthy Sleep sold the goods internally to subsidiary trading companies who then sold to goods domestically to unrelated customers. As a result, the CBSA requested and received complete RFI responses^{Footnote 14} from five subsidiaries that had domestic sales made to unrelated customers as part of the second dumping SRFI issued to De Rucci Healthy Sleep.

In reviewing the information provided by the five subsidiary companies, including their domestic sales databases, the CBSA found that none of the companies had domestic sales of like goods. As a result, it was not possible to determine normal values pursuant to section 15 of SIMA using domestic sales of like goods.

As such, normal values were determined pursuant to paragraph 19(b) of SIMA, based on the aggregate of the cost of production of the goods, a reasonable amount for administrative, selling and all other costs, and a reasonable amount for profits.

Specific normal values for future shipments of subject goods have been determined for De Rucci Healthy Sleep. These normal values are effective today, July 4, 2024.

The GOC did not respond to the CBSA’s Government Subsidy RFI, which limited the CBSA’s ability to determine the amount of subsidy in the prescribed manner as the required information relating to financial contribution, benefit and specificity was not provided. Therefore, subsidy amounts for the exporter were determined pursuant to subsection 30.4(2) of SIMA, based on a ministerial specification.

In consideration of the fact that the exporter provided sufficient information in response to their Subsidy RFI, an amount of subsidy was determined based on the information provided in response to the Subsidy RFI and additional information obtained through an SRFI. The amount of subsidy determined for De Rucci Healthy Sleep for future shipments is CNY 84.05 per piece.

The normal values and amounts of subsidy determined as a result of this review may be applied to any requests for re-determination of importations of subject goods that have not been processed prior to the conclusion of this normal value review, regardless of the date that the requests were received. The normal values and amounts of subsidy determined as a result of this review may be applied retroactively where the conditions described below are met.

Exporter responsibility

All parties are cautioned that where there are increases in domestic prices and/or costs, the export price should be increased accordingly to ensure that any sale made to Canada is not only above the normal value but at or above selling prices and full costs and profit of the goods in the exporter’s domestic market. If exporters do not properly notify the CBSA of any such changes, do not adjust export prices appropriately, or do not provide the information required to make any necessary adjustments to normal values and export prices, retroactive assessments will be applied where such action is warranted.

Importer responsibility

Importers are reminded that it is their responsibility to calculate and declare their anti-dumping duty and countervailing duty liabilities. If importers are using the services of a customs broker to clear importations, the brokerage firm should be advised that the goods are subject to SIMA measures and be provided with sufficient information necessary to clear the shipments. To determine their anti-dumping and countervailing liabilities, importers should contact the exporter(s) to obtain the applicable normal values and amount of subsidy. For further information on this matter, refer to Memorandum D14-1-2: Disclosure of Normal Values, Export Prices, and Amounts of Subsidy Established under the Special Import Measures Act.

The Customs Act (Act) applies, with any modifications that the circumstances require, with respect to the accounting and payment of anti-dumping duties and countervailing duties. As such, failure to pay the duties within the prescribed time will result in the application of the interest provisions of the Act.

Contact us

• Telephone:
• Matthew Lerette: 343-553-1867

Email: simaregistry-depotlmsi@cbsa-asfc.gc.ca