US Says It Has Authority to Conduct Expedited CVD Reviews, in Amicus Brief at CAFC
The Commerce Department has the statutory authority to carry out expedited reviews in countervailing duty investigations, the U.S. argued in a Feb. 7 amicus brief at the U.S. Court of Appeals for the Federal Circuit. The U.S was invited to file the amicus brief by the Federal Circuit after it failed to appear regularly in the case. Taking the court up on its offer, the government claimed that the Commerce Department had preexisting authority for the regulation under the Uruguay Round Agreements Act, though even if this preexisting structure did not exist, the URAA itself along with the Statement of Administrative Action's statements provide authority for expedited CVD reviews (Committee Overseeing Action for Lumber International Trade Investigations or Negotiations v. United States, Fed. Cir. # 22-1021).
The case stems from a January 2018 CVD order on certain softwood lumber from Canada. In March of that year, Commerce conducted an expedited CVD review for various Canadian lumber companies that were assigned the all-others rate. The Canadian producers received de minimis CVD rates as a result, rendering them exempt from the order. However, the question of whether Commerce had the right to conduct the expedited review loomed over the proceedings. The Court of International Trade said there wasn't and that Section 103(a) of the URAA didn't work as a legal home for Commerce's regulation establishing the reviews (see 2108190002).
The Canadian federal government, along with the governments of Quebec and New Brunswick and six Canadian companies, appealed to the Federal Circuit. In their opening brief, the plaintiff-appellants pushed for Section 103(a) as justification for the process, since it provides for officers of the U.S. government to issue regulations necessary to ensure that any part of the URAA is "appropriately implemented" (see 2112280025). This section is relevant since the U.S. signed the WTO Agreement on Subsidies and Countervailing Measures, a part of the URAA, which requires signatories to provide a procedure in their domestic CVD laws where non-individually examined respondents can get an expedited review.
Backing the appellants' arguments, the U.S. amicus brief argued that Commerce had preexisting authority for the expedited reviews since the SAA accompanying the Trade Agreements Act of 1979 told Commerce to establish a regulation setting up an exclusion mechanism. This "broad grant of authority" led to Commerce crafting a regulation allowing it to exclude companies that satisfied certain requirements. "An expedited review is admittedly different in process from an exclusion, but similar in effect -- the requesting company is not subject to the order if it can demonstrate it did not receive the government benefit," the brief said. "Therefore, Commerce reasonably conformed its previous procedures (providing relief to non-investigated companies), with the URAA."
The trade court, in making its decision, relied mainly on the fact that the URAA does not explicitly authorize an expedited-review procedure. "That principle has no application here," the U.S. said. "As discussed, Congress did provide Commerce with authority to issue regulations 'necessary to ... appropriately implement' the URAA. And the trial court’s belief that specific grants of statutory authority are necessary to authorize every procedure is contrary to foundational principles of administrative law."
The government wrapped up its brief by claiming that Commerce's interpretation of the Agreement on Subsidies and Countervailing Measures (SCM Agreement) lets it establish expedited CVD reviews. However, since the SCM is not self-executing and does not independently grant rulemaking authority to Commerce, the validity of the reviews depends on it being authorized by domestic law. The U.S. argued that, for this reason, that is why the reviews were "lawfully promulgated ... pursuant to [Commerce's] general rulemaking authority under 19 U.S.C. § 3513(a)(2)."