United States Court of International Trade

Commerce’s Decision Remanded in Welded Line Pipe Case

Before the Court in Tosçelik Profil ve Sac Endustrisi A.Ş. et. al. v. United States et. al., Slip Op. 18-148, Court No. 15-00339 (October 24, 2018) were remand determinations from Commerce in the antidumping investigation of welded line pipe from Korea and Turkey. At issue in this case is the amount of which Commerce must increase the export price of goods from Turkey because of duty drawback received national companies. Specifically, the refunds received from companies through Turkish Government’s Inward Processing Regime which allows for import duty exemptions through certificates is under review. Commerce determined that all eligible claims must have been closed during the period of investigation at a specific date, which the plaintiffs do not agree with. For the reasons that follow, the court remands this matter to Commerce to recalculate plaintiffs’ duty drawback adjustment.

“Neither the duty drawback statute nor the legislative history provides guidance on the methodology to be used … in the absence of such guidance, Commerce may develop reasonable methodologies to fill gaps.” Id. at 7. The Court said the issue was to be reviewed as a “substantial evidence issue in which the court evaluates the reasonableness of Commerce’s POI limitation given the administrative record.” Id. at 7-8. Commerce’s main reason for denying the claim was because the agency claimed it was general practice to only examine costs and expenses during the POI. However, as the Court observed this could not be supported by substantial evidence because “Commerce collected and verified information on all” of claims submitted by Plaintiffs, regardless of whether the claims closed within the POI or not. Id. at 6. Commerce also argued impracticability in reviewing the data, an argument the Court also said could not be supported by substantial evidence because the agency reviewed and verified all of the claims regardless of whether they were in the POI. The agency’s final argument was that certain claims could get double counted, an argument dismissed by the Court by saying claims “simply cannot be double-counted.” Id. at 10. According to the Court, “Commerce’s imposition of the POI limitation in this matter unreasonably undercuts its stated goals of accuracy, transparency, and predictability by ignoring verified record information,” and that the only thing left to do was to calculate Plaintiffs’ duty drawback adjustments consistent with that verified information. Id. at 11.