CIT Remands AD Duty Circumvention Finding on Mexican Wire Rod; Product Already Widely Known
The Court of International Trade remanded the results of an anticircumvention inquiry on steel wire rod from Mexico that found Deacero’s product to be subject to antidumping duties. Commerce had found Deacero’s wire rod, with a diameter of 4.75mm, only constituted a “minor alteration” from merchandise otherwise subject to AD duties under the order. The scope of the order on carbon and steel wire rod from Mexico says it covers steel wire rod measuring between 5mm and 19mm in diameter. The court found that existence of 4.75mm wire was so widely known before the scope was written by domestic industry that the petitioners could have covered it under the order, but chose not to.
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CIT didn’t go as far as saying the existence of a product at the time an AD/CVD order is issued prevents that product from being included under an order by a “minor alteration” anticircumvention inquiry. To alter something only means to modify it, not to create something completely new. The anticircumvention statute’s provisions on later-developed products -- which immediately follows the subsection on minor alterations -- specifically says that the product must be new, which undermines Deacero’s interpretation of a “minor alteration” as being something novel, CIT said. Commerce’s general interpretation of minor alterations as possibly including already-existing merchandise is reasonable, CIT said, because Deacero’s interpretation would limit Commerce’s ability to find circumvention by way of minor alteration even if nobody knew at the time of circumvention that the product in question actually existed.
But the court found Commerce’s finding of minor alteration circumvention in this instance to be flawed. While preexistence of a product doesn’t always prevent a finding of minor alteration, in this case the existence of the product was so widely known that domestic industry could have included it in the scope of the order had it so chosen. Instead, the scope’s 5mm lower limit on subject wire rod is one of its main features. “In reality, petitioners want to rewrite the order so it says what they wish it had said at its inception,” said CIT. “This belated attempt (that Commerce sanctioned) is unfair to Deacero, which invested substantial amounts of money in manufacturing what it reasonably considered non-subject merchandise.”
(Deacero USA, Inc. v. U.S., Slip Op. 13-126, dated 09/30/13, public version 10/25/13, Judge Goldberg)