CIT Can Hear Scope Claim in AD Circumvention Case on Chinese Garlic, Importer Argues
The Court of International Trade has jurisdiction over importer Green Garden Produce’s claim that the Commerce Department failed to find if its garlic was expressly excluded from the scope of the antidumping duty order on Chinese fresh garlic in an AD circumvention proceeding, the importer claimed in a supplemental brief filed with CIT on Feb. 9 (Green Garden Produce v. United States, CIT # 24-00114).
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
The supplemental brief was filed in Green Garden's suit against Commerce's finding that "small and large garlic chunks" coated with citric acid made in China circumvented the AD order on Chinese fresh garlic (see 2408090042).
The circumvention proceeding stemmed from a separate scope proceeding, initiated by Green Garden, in which Commerce determined that the importer's garlic was subject to the order. The importer claimed its imported garlic was exempt from the scope of the order, since it was preserved in citric acid, meaning it wasn't "fresh garlic."
Green Garden said “Commerce must first determine whether the merchandise is expressly excluded” before conducting a minor alterations analysis during a circumvention inquiry. The importer said, “despite [it] raising the issue and submitting supporting evidence,” Commerce failed to determine whether the product, garlic cloves preserved by citric acid, is expressly excluded from the scope of the AD order.
However, petitioner Fresh Garlic Producers Association responded that Green Garden didn’t use citric acid as a preservative and argued Commerce’s finding that the importer circumvented the AD order was correct (see 2508110060).
After the parties filed motions for judgment, Judge M. Miller Baker ordered the parties to file supplemental briefs on whether the court has jurisdiction to consider Green Garden's claim that its imports are "expressly excluded from the scope of the relevant" AD order when Commerce "declined to rule upon that argument in a scope proceeding." The judge also asked the parties to address whether the court can hear Green Garden's claim in light of the importer's failure to challenge the scope ruling in which Commerce declined to rule on the importer's claim.
Green Garden argued in its supplemental brief that Commerce's scope regulation doesn't say the agency must address every argument raised in the scope application. Nor does it say that "silence in a ruling as to an issue raised in a scope application is a negative determination on that issue," the importer said.
Commerce also didn't err in failing to rule on Green Garden's claim, since the agency was "permitted to make a finding at a later time," the brief said. Thus, Commerce is allowed to consider in a circumvention inquiry "whether a product considered out-of-scope for one reason is also expressly excluded for another reason."
Conversely, Commerce was required to decide the "express-exclusion issue during the circumvention inquiry," the importer said.
Green Garden said it doesn’t seek to “collaterally attack earlier administrative proceedings” as it “participated in the Scope Ruling, does not challenge its results, and exhausted its administrative remedies.” Instead, citing the U.S. Court of Appeals for the Federal Circuit's rulings in Wheatland v. U.S. and Deacero v. U.S., the importer said the court determined that Commerce can’t conduct minor alterations analyses for products that are “expressly excluded” from the scope of an AD order.
“Accepting a contrary position would create a jurisdictional trap,” the importer said. “Commerce could avoid judicial review of a circumvention determination simply by declining to find an express-exclusion in a scope ruling and then treating that failure as preclusive in a later determination.”