AD/CVD Scope Rulings Apply to Products Generally, Not to Specific Importers, CIT Says
Antidumping and countervailing duty scope rulings issued by the Commerce Department apply broadly to products, not just to the importer or producer that requested the scope ruling, the Court of International Trade said on Sept. 19 (here). CBP officers tasked with administering AD/CV duty collection at the ports, as well as other importers, may rely on scope rulings issued to unrelated companies as long as the product they’re importing is the same as the product covered by the scope ruling, CIT said as it told Commerce to reconsider its decision to assess AD/CV duties on curtain wall units imported by Jangho.
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Commerce had found Jangho’s curtain wall units were subject to duties on aluminum extrusions from China during AD/CV duty administrative reviews covering entries in 2012 and 2013. At the time, Commerce was also preparing to issue a scope ruling on curtain wall units imported by Yuanda. Jangho argued its curtain wall units are covered by the Yuanda scope ruling because they are the same product, and said Commerce could not suspend liquidation or assess duties on its 2012-13 entries because the agency had not yet made a decision in the Yuanda ruling on the general applicability of AD/CV duties to these particular curtain wall units.
Commerce said the Yuanda ruling was irrelevant because scope rulings “apply only to specific merchandise from a specific importer or exporter.” However, the language of the regulations governing scope rulings suggests they apply more broadly, CIT said. For example, the regulations say “any interested party” may request a scope ruling to determine whether “a particular product,” is covered by duties, rather than “its particular product.” Company-specific scope rulings would also run contrary to the purpose of the regulations -- “clarity of scope and predictability of administration” -- by negating CBP’s ability to rely on past scope rulings for guidance in determining whether to declare merchandise at the border as subject, or not subject, to AD/CV duties, CIT said.
Commerce’s decision during the administrative reviews that Jangho’s curtain wall units are subject to AD/CV duties was also flawed, CIT said. Commerce had found the products subject to duties without conducting a formal scope ruling, “while acknowledging that the determination was incomplete,” because Jangho had not requested a scope ruling, CIT said. But “[u]nder its own regulations, if Commerce ‘determines from available information that an inquiry is warranted to determine whether a product is included within the scope of [an order],’ Commerce ‘will initiate an inquiry,’” the trade court said. Commerce itself determined that the scope was ambiguous and a scope inquiry was warranted, and therefore was “obligated to initiate a scope inquiry,” it said. Commerce could have done so within the administrative review, but was required to follow the requirements of a formal scope inquiry, CIT said.
(Guangzhou Jangho Curtain Wall Sys. Eng'g Co. v. U.S., Slip Op. 16-87, CIT # 15-00023, -00024, dated 09/19/16, Judge Pogue)