United States Court of International Trade

19-138

Before the Court in POSCO et. al. v. United States et. al., Slip Op. 19-138, Court No. 17-00137 (November 8, 2019) was U.S. Department of Commerce’s (“Commerce”) remand results regarding the final affirmative determination in the countervailing duty investigation of certain carbon and alloy cut-to-length (“CTL”) plate from Korea. POSCO challenged Commerce’s use and application of the highest adverse facts available (“AFA”) in regards to POSCO M-Tech’s Industrial Technology Innovation Promotion Act (“ITIPA”) grants. For the following reasons the Court sustained Commerce’s remand determinations.

“19 U.S.C. § 1677e(d)(2) requires Commerce to do something more—i.e., an evaluation of the specific situation, to justify its decision to apply the highest available rates out of all possible rates.” Id. at 7. Commerce must “conduct a fact-specific inquiry and … provide its reasons for selecting the highest rate out of all potential countervailable subsidy rates in a particular case.” Id. The Court said on remand the agency had “explained that POSCO’s “inaccurate reporting created gaps in the evidentiary record and that POSCO … failed to act to the best of its ability” and cited the “need to induce cooperation, the relevance of a rate to the industry in the country under investigation, and the relevance of a particular program.” Id. at 7-8. As such, t he Court sustained the use of the highest AFA rate. In addition, the Court sustained Commerce’s “factual findings to move beyond step one of the AFA hierarchy.” Id at 10-11.

19-139

Before the Court in YC Rubber Co. (N. Am.) et. al.  v. United States, Slip Op. 19-139, Court No. 19-0069 (November 8, 2019) was “Plaintiff-Intervenor Kenda Rubber (China) Co., Ltd.’s (“Kenda”) motion to modify the statutory injunction entered on July 2, 2019, to cover more than 250 entries of Kenda’s subject merchandise during the period of review that were liquidated on June 14 and 21, 2019.” Id. at 2. For the following reasons the Court denied Kenda’s motion.

Under 19 U.S.C. § 1516a, “if liquidation of the covered entries is enjoined by the court, such entries must be liquidated in accordance with the final court decision in the action …otherwise, the entries must be liquidated in accordance with Commerce’s determination.” Id. at 11. The Court said in this situation, Kena is asking the Court to “order the reversal of liquidation of Kenda’s entries that were liquidated in accordance with the Final Results at a time when no injunction was in place.” Id. at 6. Kenda’s approach was “inconsistent with Congress’s statutory framework” and the Court denied the motion. Id. at 12.

19-140

Before the Court in Shake and Shingle Alliance et. al. v. United States et. al, Slip Op. 19-140, Court No. 18-00228 (November 13, 2018) was a challenge by plaintiff, Shake and Shingle Alliance (“Alliance”), and plaintiff-intervenor, the Government of Canada (“GOC”), to Commerce’s final scope ruling holding softwood lumber products of certain cedar shakes and shingles (“CSS”) were within the scope of the antidumping and countervailing duty orders on certain softwood lumber products from Canada. For the reasons discussed below, the Court concluded Commerce’s scope determination was not in accordance with the law and remanded for reconsideration.

When an importer requests a scope ruling, “Commerce must first examine the language of the order itself.” Id. at 8. “If the scope language is ambiguous, Commerce must then consider the descriptions of the merchandise contained in the petition, how the scope was defined in the initial investigation, and the determinations issued by Commerce including prior scope determinations and the Commission. Id. These factors are known as the (k)(1) sources, “If the (k)(1) sources are dispositive, Commerce will issue a final scope ruling.” Id. “If the (k)(1) sources are not dispositive, Commerce must address additional criteria known as the (k)(2) factors.” Id. In this case, Commerce found the (k)(1) factors dispositive to including the CSS within the scope of the Orders. The Court said “Commerce’s Final Scope Ruling contains no substantive discussion of prior lumber proceedings or prior scope determinations in which Commerce found CSS to be distinct from softwood lumber since at least 1983.” Id. at 18. As such, “Commerce cannot claim to have sufficiently addressed the prior proceedings by its passing reference to the history of contrary prior softwood lumber investigations in its Final Scope Ruling.” As such, the Court found that Commerce had not adequately addressed the (k)(1) factors and remanded the scope ruling.