ITA No Longer Allows "Zero Margin" AD/CV Order Revocations for Specific Companies
The International Trade Administration is amending its regulations to end the opportunity to revoke an antidumping or countervailing duty order for specific companies with consecutive years of zero margins. The ITA’s final rule, which will be effective for all administrative reviews initiated on or after June 20, 2012, amends 19 CFR 351.222 to eliminate the provision for revocation of an AD or CV order for an exporter or producer based on its receipt of AD rates of zero for three consecutive years, or CV rates of zero for five consecutive years.
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Final Rule Eliminates Company-Specific Revocation Provisions at 19 CFR 351.222
The ITA’s final rule removes the provisions for company-specific revocation in administrative reviews at 19 CFR 351.222(b)(2) and (3) and 19 CFR 351.222(c)(3) and (4) after three years of zero AD margins or five years of zero CV margins, and makes additional conforming changes (for example, the final rule amends 19 CFR 351.222(e) on requests for revocation or termination to no longer allow companies to request company-specific revocation).
(Separately, the final rule also removes 19 CFR 351.222(m), which prescribes the “transition rule” for treatment of review periods prior to enactment of the Uruguay Round Agreements Act of 1994, as the ITA said the “transition rule” is no longer applicable.)
Final Rule Does Not Affect Other Forms of Revocation in Part
The ITA said its amendments do not affect other types of partial revocations. For example, orders may continue to be revoked in part if a party demonstrates a lack of interest in maintaining the order on a certain type of subject merchandise by substantially all of the domestic industry.
Provisions Eliminated due to “Disconnect” Between Resources Expended, Benefit
The ITA said it is eliminating company-specific revocations because of the “disconnect” between the large amount of resources expended conducting these company-specific revocation reviews and the few companies that benefit. Specifically, according to the ITA, the procedure requires the ITA to expend additional resources to conduct administrative reviews where a request for company-specific revocation is being considered, but only a small fraction of the companies the ITA reviews are ultimately found to be eligible for a company-specific revocation. The ITA said roughly 75% of the company-specific revocation requests that it received between 2005 and 2009 were denied.
Furthermore, said the ITA, to the extent that eligible companies maintain antidumping duty or countervailing duty rates of zero percent, the proposal would not change the amount of duties applied to subject entries. The ITA also cited the inequity between certain companies selected more frequently for review, giving them a higher chance of reaching three years of zero AD margins or five years of zero CV margins, and companies that are rarely selected and more likely to be ineligible for company-specific.
ITA Declines to Say if Full Revocation Possible if All Companies get Three (or Five) Zero Rates
In response to comments regarding the probability that the ITA’s recent modification of its methodology in administrative reviews to eliminate zeroing will lead to more zero rates assigned to companies, and particularly the possibility of full revocation in administrative reviews should all companies reviewed receive three consecutive zero AD rates or five consecutive zero CV rates, the ITA declined to address the issue. The ITA said it will address any such scenarios as they arise in the context of future antidumping or countervailing duty proceedings.
(See ITT’s Online Archives 11032128 for summary of the proposed rule to eliminate the provisions on company-specific partial revocation in administrative reviews. See also ITT’s Online Archives 12021329 for summary of the ITA’s final rule eliminating zeroing in administrative reviews.)