United States importers must pay cash deposits of 3.84% to 112.29% on Chinese stationary and portable air compressors from Oct. 1, 2026, after a preliminary Commerce subsidy finding.
The U.S. Department of Commerce has found in a preliminary ruling that Chinese makers of stationary and portable air compressors receive unfair government subsidies, and from Oct. 1, 2026, importers must pay cash deposits of 3.84% to 112.29% on these compressors1.
The ruling appeared in the Federal Register on Oct. 1, 2026, and is dated Sept. 28, 20261. It is the first decision on duties in a case that a U.S. compressor maker began in April 20262.
In short, piston-type air compressors from China now cost more to bring into the United States. Customs will hold back the final duty bill on each shipment and collect a deposit at the border, at 3.84% of the value for most Chinese suppliers and 112.29% for six named companies.
What did Commerce decide on Chinese air compressors?
Commerce found that producers and exporters of air compressors in China receive countervailable subsidies1. These are government support that gives a company a benefit and that U.S. law allows to be offset with an extra import tax. That tax is called a countervailing duty.
The decision is preliminary. Commerce looked at subsidies given during the period of investigation, Jan. 1 to Dec. 31, 20251. Its final decision will come later, after it checks the companies’ information.
Commerce also found that some companies did not answer its questions as well as they could1. For those companies it used "adverse inferences". This means it chose the facts least helpful to them when setting their rates.
Which companies face the 112.29% rate?
Commerce examined two Chinese companies in detail, called mandatory respondents1. One was FNA (Zhejiang) Co., Ltd., known as FNZ. The other was Suzhou Alton Electrical & Mechanical Industry Co., Ltd., known as Suzhou Alton.
FNZ received a calculated rate of 3.84%1. Suzhou Alton received a rate based entirely on facts available, because it did not cooperate fully.
The Federal Register notice lists these preliminary subsidy rates, as a share of the goods’ value1:
- FNA (Zhejiang) Co., Ltd.: 3.84%
- Shanghai Aote E-Commerce Co., Ltd.: 112.29%
- Shanghai Greeloy Industry Co., Ltd.: 112.29%
- Suzhou Alton Electrical & Mechanical Industry Co., Ltd.: 112.29%
- Suzhou Honbase Machinery Manufactur: 112.29%
- Taizhou Huanyang Electric & Machinery Co., Ltd.: 112.29%
- Yancheng Dafeng Zhenlian Machinery: 112.29%
- All other Chinese producers and exporters: 3.84%
The six companies at 112.29% all received rates based on facts available with adverse inferences1. A deposit of 112.29% more than doubles the cost of a compressor at the border.
How was the 3.84% rate for other suppliers set?
The law sets an "all-others rate" for companies that Commerce did not examine one by one1. It is normally the average of the rates for the examined companies. Zero rates, very small rates and rates based only on facts available are left out.
Suzhou Alton’s rate was based only on facts available, so it did not count1. That left FNZ’s rate as the only usable one. Commerce therefore gave 3.84% to all other producers and exporters in China.
The petition named over 300 companies in China as producers or exporters of air compressors2. Most of these suppliers will fall under the all-others rate.
How do the cash deposits work at the border?
Commerce will tell U.S. Customs and Border Protection (CBP) to suspend liquidation of the goods1. Liquidation is the final step in which customs fixes the duty owed on an entry. Suspending it means the final bill stays open until the case ends.
Which deposit rate applies
| Who made or sold it | Deposit rate | Set by |
|---|---|---|
| A listed company | 3.84% or 112.29% | That company’s own rate |
| Producer and exporter both listed | The higher rate | Both companies’ rates |
| Only producer or exporter listed | That company’s rate | The listed company |
| All other Chinese suppliers | 3.84% | FNZ’s calculated rate |
This applies to compressors entered, or taken out of a bonded warehouse, for use in the United States on or after Oct. 1, 20261. CBP will also collect a cash deposit equal to the estimated subsidy rate.
The notice gives these rules for choosing the deposit rate1:
- A listed company pays its own rate.
- If both the producer and the exporter have their own rates and they differ, the higher rate applies.
- If only the producer or only the exporter has its own rate, that rate applies.
- All other producers and exporters pay the all-others rate of 3.84%.
So the deposit depends on who made the compressor and who sold it abroad. An importer buying from a trading company that sources from a 112.29% factory pays the higher rate.
Which air compressors are covered?
The case covers certain stationary and portable air compressors, whether electric, gas or battery powered1. They use reciprocating pumps, either oil-free or oil-lubricated, and have a built-in air tank of 1 to 80 gallons. They may be direct drive or belt driven.
Covered compressors have a power rating between 373 watts (0.5 HP) and 22.37 kilowatts (30 HP)1. The case includes only reciprocating or piston compressors. In these, a piston moves back and forth in a cylinder to squeeze the air.
The scope also reaches further than finished machines1:
- Unfinished compressors, meaning compressors that still need labelling, packaging or kitting with accessories.
- Compressors processed further in a third country or in the United States, such as being assembled there.
- Compressors sold in a kit with accessories, such as hoses, fittings, nail guns, paint sprayers, air wrenches, air drills or air inflators.
Accessories imported on their own, without the compressor, are not covered1. Commerce did not change the scope from the version in its May 2026 notice.
Which compressors are left out?
Some goods are specifically excluded1:
- Small inflators powered by AC, DC or battery, with no built-in air tank, and an output of 1 CFM or less.
- Rotary compressors, including rotary screw, rotary vane and scroll compressors.
- Dynamic compressors, including centrifugal and axial compressors, where spinning impellers or blades squeeze the air.
Compressors outside the case
The stationary compressors in the case fall under U.S. tariff subheadings 8414.80.1615, 8414.80.1625 and 8414.80.16351. The U.S. International Trade Commission (ITC), the agency that judges harm to U.S. industry, described the goods under subheading 8414.80.163.
Why did the case start?
On April 30, 2026, MAT Industries, LLC, a U.S. maker of air compressors based in Long Grove, Illinois, filed petitions with Commerce and the ITC3. It asked for duties on subsidized compressors from China, Malaysia and Vietnam. It also asked for anti-dumping duties, an extra import tax on goods sold abroad below their normal price.
Alleged subsidy programs Commerce agreed to examine
The petitioner said imports had grown sharply and taken market share2. It also pointed to lower U.S. prices, lost sales, falling U.S. shipments and a U.S. producer that stopped making compressors.
Commerce started the subsidy case on May 20, 2026, and published its notice on May 27, 20264. It agreed to look at 39 alleged subsidy programs in China2. It also looked at 23 programs in Malaysia and 43 in Vietnam, in separate cases.
On June 15, 2026, the ITC found a "reasonable indication" that imports from the three countries harm the U.S. industry3. That vote let the cases go on.
Why did the decision come in September?
The law normally gives Commerce 65 days after the start of a case to issue a preliminary subsidy decision4. The original deadline was July 24, 2026.
From petition to deposits
On July 17, 2026, Commerce postponed the decision to Sept. 28, 20264. It said the cases were "extraordinarily complicated" because of an unusually high number of alleged subsidy programs. MAT Industries had also asked for more time in a letter dated July 6, 2026.
What happens next in the air compressor case?
Commerce will share its calculations with the parties within five days of announcing the decision1. It also plans to check the information it relied on, a step called verification.
Parties may ask for a hearing within 30 days of the Oct. 1 notice1. Written comments on other issues are due no later than seven days after the last verification report.
Commerce has tied the final subsidy decision to the final decision in the parallel anti-dumping case on Chinese compressors1. MAT Industries asked for this. Both final decisions are due no later than Feb. 10, 2027, unless postponed.
If the final decision is positive, the ITC will then decide whether the imports harm the U.S. industry1. It must decide by the later of 120 days after the preliminary decision or 45 days after the final one. Only a positive ITC vote leads to a lasting duty order.
Key points on the Chinese air compressor duties
The main facts of the preliminary decision are below.
| Question | Answer |
|---|---|
| What changed? | Preliminary countervailing duty finding |
| Who issued it? | U.S. Department of Commerce |
| Which goods? | Piston air compressors, 1 to 80 gallon tank |
| From where? | China |
| Power range | 373 watts to 22.37 kW |
| Rate for most suppliers | 3.84% |
| Rate for six named companies | 112.29% |
| Who pays? | U.S. importers, as cash deposits |
| Deposits start | Oct. 1, 2026 |
| Hearing request deadline | Within 30 days of Oct. 1, 2026 |
| Final Commerce decision | By Feb. 10, 2027, unless postponed |
| Who filed the case? | MAT Industries, LLC |
From Oct. 1, 2026, every covered Chinese compressor entering the United States carries a cash deposit at the border1. The rates may change when Commerce issues its final decision, due by Feb. 10, 2027, unless postponed.
Sources
- ↩ Federal Register :: Stationary and Portable Air Compressors From the People’s Republic of China: Preliminary Affirmative Countervailing Duty Determination and Alignment of Final Determination With Final Antidumping Duty Determination https://www.federalregister.gov/documents/2026/10/01/2026-20165/stationary-and-portable-air-compressors-from-the-peoples-republic-of-china-preliminary-affirmative
- ↩ Federal Register :: Stationary and Portable Air Compressors From the People’s Republic of China, Malaysia, and the Socialist Republic of Vietnam: Initiation of Countervailing Duty Investigations https://www.federalregister.gov/documents/2026/05/27/2026-10526/stationary-and-portable-air-compressors-from-the-peoples-republic-of-china-malaysia-and-the
- ↩ Federal Register :: Air Compressors From China, Malaysia, and Vietnam; Determinations https://www.federalregister.gov/documents/2026/06/18/2026-12263/air-compressors-from-china-malaysia-and-vietnam-determinations
- ↩ Federal Register :: Stationary and Portable Air Compressors From the People’s Republic of China, Malaysia, and the Socialist Republic of Vietnam: Postponement of Preliminary Determinations in Countervailing Duty Investigations https://www.federalregister.gov/documents/2026/07/17/2026-14498/stationary-and-portable-air-compressors-from-the-peoples-republic-of-china-malaysia-and-the