CIT Accepts New Definition for Aluminum Extrusions 'Finished Goods Kits,' Still Remands
The Court of International Trade on March 26 accepted new criteria for determining if products are subject to antidumping and countervailing duties on aluminum extrusions from China (A-570-967/C-570-968), but rejected the agency’s application of that criteria to trim kits imported Meridian Products. Commerce’s new definition clarifies that finished goods kits that are intended to display or incorporate customizable materials, or work with removable or replaceable components, may be excluded from AD/CVD duties on aluminum extrusions, in light of several recent scope rulings. CIT agreed with the scope clarification, but not with Commerce’s decision to find Meridian’s trim kits in scope because they aren’t intended to “display” or “work with removable or replaceable components.”
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Meridian Says Refrigerator Trim Kits Meet ‘Finished Goods Kit’ Exception
Meridian’s trim kits are sold as a package of finished parts which when assembled make up a frame to fit around a refrigerator or freezer. The company argued that they were not subject to AD/CV duties because they met an exception for “finished goods kits,” or “a packaged combination of parts that contains, at the time of importation all of the necessary parts to fully assemble a final finished good and requires no further processing or fabrication, such as cutting or punching, and is assembled ‘as is’ into a finished product.”
Commerce had in 2012 found Meridian’s trim kits didn’t qualify for the exception because they consisted entirely of aluminum extrusions and fasteners. CIT sent the case back down a year later, telling Commerce it needed to consider new criteria it had developed in several intervening scope rulings. The new criteria addressed finished goods kits that are complete except for an interchangeable component, like a drapery rail kit or a solar panel mounting kit.
Commerce Adds New Criteria for Finished Goods Kits
In its remand redetermination, Commerce defined the new exceptions under the “finished goods kits” exception as follows: “a finished goods kit which is designed to display or incorporate customizable materials or work with removable/replaceable components will be excluded if it contains, at the time of importation, all of the parts necessary to assemble a final finished good for such purposes.”
CIT accepted the new definition, finding it faithful to previous scope rulings. But it said Commerce failed to apply it correctly. On remand, Commerce had found Meridian’s trim kits aren’t for “display,” don’t “incorporate customizable materials,” and “don’t work with removable/replaceable components,” so they still don’t meet the “finished goods kits” exception. But Commerce didn’t convince the court that refrigerators or freezers can't be displayed and aren't removable or replaceable components. CIT said Commerce’s decisions were “conclusory” and not based on a review of evidence. It remanded again for Commerce to take a closer look at the issue.
(Meridian Products v. U.S., Slip Op. 14-32, dated 03/26/14, Judge Musgrave)