CIT Remands 2008-09 China Steel Nails AD Review on Misdeclared Exporters
In an August decision only made public on Nov. 14, the Court of International Trade remanded aspects of the Commerce Department’s 2008-09 antidumping duty administrative review on steel nails from China (A-570-909). The court’s Aug. 30 opinion took issue with Commerce’s treatment of entries that importers had said were exported by Certified Products International (CPI), even though that Taiwanese company was found to have no exports during the period. CIT found inconsistencies between Commerce practice in market economy reviews, where the importers would have paid the all others rate in that situation, and non-market economy reviews such as this one, where the importers were allowed to pay CPI’s rate.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
However, despite a challenge by domestic company Mid Continent Nail of Commerce’s respondent selection in the review -- the agency examined only two companies -- the court refused to make Commerce take another crack. Mid Continent had only raised the issue before the preliminary results of the review, and not after, so the company wasn’t allowed to try the issue in court. CIT requires that litigants “exhaust administrative remedies” by fully arguing their points at the agency before filing a court challenge, and Commerce’s regulations require companies to argue issues in response to the preliminary results, even if they had already made the arguments beforehand.
Mid Continent Nail nearly struck out as well on the issue of the entries misdeclared to have been exported by CPI. The company had argued that the importers were committing fraud by selecting false exporter AD rates, but the court said most of those importers had no reason to lie. Most of the entries should have been declared at the Chinese producer’s AD rate, because the producer knew the goods were destined for resale in the U.S. when it sold them to CPI. But for almost all of the entries, the producer had the same AD rate as CPI -- there was nothing to gain by committing fraud.
But an argument that only commanded “a short few paragraphs" of Mid Continent’s briefs caught the court’s eye. Before mid-2011, Commerce allowed entries with misdeclared exporters to come in at the importer’s declared rate in non-market economy proceedings. Meanwhile, in market economy proceedings, Commerce has since 2003 required misdeclared entries to be liquidated at the countrywide “all others” rate. The court said Commerce didn’t fully address this inconsistency, and remanded for further explanation.
(Mid Continent Nail Corp. v. U.S., Slip Op. 13-115, dated 08/30/13, public version 11/14/13, Judge Ridgway)