United States Court of International Trade

Court Sustained Commerce’s Remand Determinations

Before the Court in Aristocraft of America, LLC v. United States, Slip Op. 19-48, Court No. 15-00307 (April 17, 2019) were remand determinations made by Commerce in regards to the sixth administrative review of the antidumping duty order covering steel wire garment hangers from China. Plaintiffs challenged Commerce’s calculation regarding irrecoverable value-added tax (“VAT”), arguing the determinations were not supported by substantial evidence. The Court had previously remanded Commerce’s determinations “due to Commerce’s failure to reconcile the relevance of the admitted link between the input VAT paid and the aggregate tax paid or refunded.” Id. at 5. For the following reasons, the Court sustained Commerce’s determinations.

“When addressing a substantial evidence issue raised by a party, the court analyzes whether the challenged agency action was reasonable given the circumstances presented by the whole record.” Id. at 4.  The Court said “on remand, Commerce addressed these concerns, explaining how the Chinese VAT regulations direct the calculation of an amount of irrecoverable VAT that is to be added to the price of the subject merchandise exports, without reference to the exporter’s input VAT paid.” Id. at 5. Commerce directly responded to the court’s request for additional detail as to how and why Commerce was applying its irrecoverable VAT policy generally, as well as how its eight percent irrecoverable VAT adjustment was supported by the record.

Court Sustained Commerce’s Determinations in Review of Duty Order Covering Freshwater Crawfish Tail Meat from China

Before the Court in Xiping Opeck Food Co. v. United States, Slip Op. 19-50, Court No. 17-00260 (April 26, 2019) plaintiffs challenged Commerce’s final results in the administrative review of the antidumping duty order covering freshwater crawfish tail meat from China. Plaintiff specifically challenged Commerce’s rejection of untimely filed surrogate country financial statements from Thailand and Commerce’s reliance on South African financial statements as the basis for a normal value calculation. For the following reasons, the Court sustained Commerce’s determinations.     

“The regulatory deadline for surrogate value information used in calculating normal value was no later than 30 days before the scheduled date of the preliminary results, in accordance with 19 C.F.R. § 351.301.” Id. at 9. Plaintiff argued Commerce should have exercised its discretion to allow the Thai financial statements on the record, or should have placed Thai data on the record itself. The Court said the record “indicated that Thai financial statements were available … at least two weeks prior to the initial deadline … therefore … Commerce did not abuse its discretion by not accepting” late submissions. In regards to the issues with the South African financial statements, “the Court shall, where appropriate, require the exhaustion of administrative remedies.” Id. at 13. The Court said plaintiff “had ample opportunity to raise their concerns before the Department throughout the administrative proceedings,” but failed to do so. Therefore, the court would not reach the merit of the argument regarding the South African financial statements and sustained Commerce.

U.S. Court of Appeals for the Federal Circuit

Santa Claus Costume is Not a Festive Article

In Rubies Costume Company v. United States, Court No. 2018-1305 (April 29, 2019), the Federal Circuit affirmed the Court of International Trade’s decision regarding the classification of a Santa costume.  The Santa Claus costume is customarily worn in connection with the celebration of the Christmas holiday. The parties argued as to the implications of the “festive” nature of the costume. The merchandise, according to the Federal Circuit, is excluded from classification as “festive articles” by the notes to chapter 95 of the Harmonized Tariff Schedule of the United States.

Because the costumes are considered “fancy dress” pursuant to Note 1(e) of Chapter 95, they are excluded from classification under Chapter 95.  Thus, according to the Federal Circuit, the costumes are classified under HTSUS 6110.30.30, 6103.43.15, 6116.93.94, and 4209.92.30.