Curtain Wall Units May Be 'Subassemblies' Exempt From Aluminum Extrusions Duties, Says CIT
Units of curtain walls imported separately for assembly into a finished curtain wall of a building are subassemblies that may be exempt from antidumping and countervailing duties on aluminum extrusions from China, said the Court of International Trade in a Feb. 9 decision (here). The court ordered the Commerce Department to reconsider a 2014 scope ruling that found Yuanda window wall units are covered by duties because they are imported separately and ineligible for the “finished goods kit” or “finished merchandise” exemption (see 14033128).
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The curtain wall units imported by Yuanda are sold under contract to a job site so they can arrive and be installed as needed on buildings as large as skyscrapers. As the units arrive when the contractor is ready, they are imported over a period of months, with each entry corresponding to the contractor’s construction schedule. Commerce had found the curtain wall units ineligible for the “finished goods kits” and “finished merchandise” exemptions because they do not contain, on the same entry summary, all of the parts necessary to assemble a complete curtain wall.
According to CIT, that may have been Commerce’s original interpretation of the two exemptions, but Commerce has since shifted its application so that “subassemblies” may qualify even if they’re not imported with all parts necessary for the final finished good. As Commerce explained in an oft-cited 2012 scope ruling on side mount valve controls, requiring all parts present in all cases could “lead to unreasonable” or “absurd results,” such as requiring importation of an entire car rather in order for a car part to be exempt as “finished.”
Commerce failed to apply that logic here, said CIT. Arguing that a subassembly must be a “unique subsidiary component of a larger finished product,” Commerce said Yuanda’s curtain wall units were not subassemblies because they have “no identity of their own as a part of a curtain wall.” However, the scope itself defines curtain walls differently, as “partially assembled merchandise.” Going by the language in the scope, the curtain wall units are subassemblies, and are eligible for the finished goods kit exemption, said CIT.
(Shenyang Yuanda Aluminum Indus. Eng'g Co. v. U.S., Slip Op. 16-11, CIT # 14-00106, dated 02/09/16, Judge Pogue)