US Defends Surrogate Value Picks for Vietnamese Paper Plate Exporter

In the antidumping duty investigation on Vietnamese paper plates, Commerce used the financial statements of both Suparma, which Go-Pak said is an "integrated producer of tissue paper and craft paper," and Indonesian producer Alkindo. The respondent urged the agency to only use Alkindo's statements on the basis that Alkindo, which makes paper bowls, paper cups, paper food boxes and other paper products, makes merchandise comparable to Go-Pak's, while Suparma does not (see 2508280039).

Central to Go-Pak's argument is that Suparma is at a different level of integration than both the respondent and Alkindo, thus making Alkindo the better surrogate selection. Go-Pak said Commerce ignored this fact when picking Suparma.

In response, the U.S. noted that Go-Pak "attempts to highlight the difference by explaining that Suparma uses paper pulp as a raw material, but Go-Pak Vietnam purchases a finished paper product to produce subject merchandise."

In addition, the government said that Go-Pak only raised the issue once during the investigation in passing in the middle of its claim that Suparma doesn't make comparable merchandise. In any event, the U.S. said Commerce "reasonably considered the record evidence and Go-Pak Vietnam’s scant integration argument." While the respondent said Suparma only makes paper from raw materials used in the production of papers, Commerce found that record evidence showed that Suparma's facility also processed paper inputs into other paper products, the brief said.

The government also argued that Commerce's conclusion that Suparma is a producer of comparable merchandise is adequately supported on the record. While Go-Pak said the record shows that Suparma is "only engaged in paper manufacturing," the U.S. said Commerce cited an exhibit on the record that "lists a variety of paper products that Suparma provides, including 'Laminated Wrapping Kraft,' which is 'usually applicable for food wrapping paper,' and 'MG Paper, ... which can be applied to food wrappers{.}'"

It's "well within Commerce's discretion" to find that this is comparable merchandise to a "paper bowl or paper plate," since they are "used for packaging cooked, moist food," the U.S. said. And while Go-Pak lastly said it and Suparma operate in different industries under the Global Industry Classification Standard, the government argued that this is "irrelevant," since "Suparma produces paper products used for packaging cooked, moist food."

Go-Pak also argued against the valuation of its paper input, which Commerce calculated by taking a simple average of the average unit values for two different HTS subheadings, 4810.32.90 and 4810.92.90. The U.S. said Go-Pak essentially argues that Commerce should have picked subheading 4810.92.90, since the company's paper inputs meet the subheading's definitions of "multi-ply" paper, width and chemical composition.

The government noted that Commerce "actually agreed," though the agency reasonably found that this subheading doesn't "account for a separate critical component: paper basis weight."

Go-Pak said subheading 4810.32.90 doesn't match "certain material characteristics of the paper input, including chemical composition and the multi-ply structure." Again, the agency agreed, the U.S. said, noting that Commerce found that "4810.92.90 alone matches those characteristics." However, at verification, Commerce received additional information about the base weights the respondent used for its paper inputs. This information related to a "critical component in the manufacture and sale of paper plates as supported by the fact that basis weight is the fourth” product characteristic, the U.S. said.

Subheading 4910.32.90, like the other subheading, "did not match every physical characteristic of Go-Pak Vietnam’s paper inputs," requiring the agency to take a simple average of both subheadings, the brief said. Go-Pak's arguments to the contrary amount to an attempt to get the court to reweigh evidence, the U.S. argued.