Turkish CVD Respondent Says Commerce Imposed 'Impossible Burden' on Benchmark Submission
The Commerce Department erred in its selection of a benchmark to value a subsidized lease provided to countervailing duty respondent Kaptan Demir Celik Endustrisi ve Ticaret's affiliate, Nur Gemicilik, Kaptan argued in an Oct. 11 complaint at the Court of International Trade (Kaptan Demir Celik Endustrisi ve Ticaret v. United States, CIT # 25-00225).
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In the 2022 review of the CVD order on Turkish steel concrete reinforcing bar, Commerce said Kaptan received a countervailable benefit from "unimproved land" that Nur used for a shipbuilding operation in the Trabzon Province under a "rent-free 49-year lease from a Turkish government entity." To set the benchmark for valuing the benefit, the petitioners submitted a report from real estate firm Collier's International that provided rental rates for properties in "industrial zones" around Istanbul.
Meanwhile, Kaptan provided a report from real estate company Cushman & Wakefield that laid out rental rates for properties in the Trabzon Province, which is located around 1,000 km from Istanbul. Commerce picked the Colliers report, finding the Cushman report to be "unreliable because it was prepared for purposes of the litigation."
The agency also rejected Kaptan's claim that the "industrial zone" properties in the Colliers report were "likely to consist of properties" in a state-owned "Organized Industrial Zone" on the basis that the explicit reference to "industrial zone" in the Colliers report wasn't definitively a reference to a state-owned Organized Industrial Zone. Commerce also said the respondent failed to provide a "quantifiable" difference in "such factors as regional gross domestic product, regional international-trade intensity, or proximity" to Nur's facility as between the two submitted benchmarks, since "Kaptan failed to provide statistics showing a linkage between such data and rental values."
At the trade court, Kaptan argued that Commerce's decision that the Cushman & Wakefield report was "intrinsically unreliable because it was commissioned by Kaptan, and therefore could not be used as a benchmark, is unsupported by substantial evidence on the administrative record." The respondent said the agency's other reasons for rejecting its benchmark submission are unsupported, since the agency "applied to the respondent a level of proof different from, and more demanding than, the level of proof Commerce applied in its consideration of petitioners’ proffered benchmark."
Commerce imposed, it said, an "impossible burden on the respondent" and implemented a "novel test that is inconsistent with precedent and common sense."