Spanish Olive Growers Challenge US 'Substantially Dependent' Finding at Trade Court
The Court of International Trade should reject a Commerce Department Section 129 determination on ripe olives from Spain that continued to apply countervailing duties for subsidies to upstream raw olives despite an underlying World Trade Organization ruling to the contrary, a Spanish industry association and two foreign growers and exporters of olives argued in a Feb. 27 complaint at the Court of International Trade (Asociacion de Exportadores e Industriales de Aceitunas de Mesa v. U.S., CIT # 23-00039).
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In the investigation, Commerce had found that Spanish olive growers were receiving a subsidy via the EU's Common Agricultural Policy scheme, which is administered through the government of Spain, and that demand for the prior stage product -- raw olives -- was "substantially dependent on demand for the "latter stage product," ripe olives subject to the AD/CVD orders. A World Trade Organization panel ruled against the finding, prompting the Section 129 proceeding.
Commerce’s determination that demand was “substantially dependent” applied an incorrect standard, the plaintiffs argued. Even if the court finds that Commerce applied a legally correct “substantially dependent” standard, its calculation that 55.28% of the manzanilla, gordal, hojiblanca, and carresqueña produced was processed into table olives (a latter stage product) “is not supported by evidence,” the plaintiffs argued.
Spanish olive growers also recently challenged the "substantially dependent" standard at the U.S. Court of Appeals for the Federal Circuit in an appeal of Commerce's original CVD investigation (see 2301190025).