International Trade Today is a Warren News publication.

CAFC OKs Using 3rd-Party Data for Constructed Value in Bearings AD Case

In the May 2005--April 2006 AD review of ball bearings from Germany, for the first time under that order the ITA based an exporter’s constructed value1 on cost data from unaffiliated third parties who had supplied some of the exporter’s finished product, rather than on the prices paid by the exporter to the third party suppliers. As well as challenging the ITA’s use of zeroing2, SKF GmbH challenged the new CV method, arguing 1) that the change was unexplained; 2) that as a respondent it unfairly risked adverse rates since it could not compel the unrelated party to submit costs data and finally; 3) that it could not be sure to avoid dumping since it did not know the costs incurred by the third party supplier, who is also a competitor in the home market. The appeals court dismissed the zeroing challenge and confirmed that the ITA may use third-party production cost data (it does so in other AD orders), but also ruled that the ITA must provide explanations to address SKF’s other concerns. (See ITT’s Online Archives or 9/02/10 news, 10090215, for BP summary of latest AD duty rates for ball bearings.) (Appeal Number 2010-1128, dated January 7, 2011)

Sign up for a free preview to unlock the rest of this article

If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.

1Constructed value or “CV” is a substitute for home market price based on costs plus profit and overhead: the ITA uses CV as a comparison value when home market or third country prices are not available or when comparison merchandise is sold below cost.

2“Zeroing” refers to ITA’s exclusion of negative margins (i.e., U.S. sales above fair value) from the overall dumping margin calculation, a practice currently under review at the agency.