Commerce Finds Aluminum 'Pallets' Subject to AD/CV Duties on Aluminum Extrusions From China
Aluminum extrusions made from 1-series aluminum alloys that are welded together to form pallets are subject to antidumping and countervailing duties on aluminum extrusions from China (A-570-967/C-570-968), the Commerce Department said in a scope ruling issued Dec. 7. The domestic Aluminum Extruders Fair Trade Committee (AEFTC) had requested the scope ruling, alleging the pallets are only imported to be re-melted and used in other products. Agreeing the products can’t be used as pallets, Commerce applied the ruling to all such merchandise, regardless of producer or exporter.
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The AEFTC alleged that Zhongwang Holding and its affiliates import the pallets as a way to get around aluminum extrusions duties. The pallets “lack the necessary size, thickness, weight, strength, rigidity and series of aluminum alloy to perform the key functions of pallets,” like bearing weight or functioning with forklifts,” the AEFTC said. The pallets are “useful only as a way of getting a big mass of aluminum past Customs,” it said, quoting an article from the Wall Street Journal. Because they can’t be used as pallets, they don’t qualify for the “finished merchandise” exemption from duties as a pallet, it said.
Zhongwang has also acquired U.S. companies and used its affiliates to “stay ahead” of Commerce’s investigation of its importation practices and “evade responsibility for its improperly entered imports.” The AEFTC said “that it is clear that the series 1xxx aluminum pallets imported by Zhongwang and U.S. affiliates like Aluminum Shapes were entered to evade duties.” A group of senators had urged Commerce to look into the pallets in November 2015 (see 1511190007). Zhongwang did not file any comments on the scope ruling, Commerce said.
Commerce agreed that the pallets do not qualify for the “finished merchandise” exemption, and are subject to AD/CV duties. Though the Court of International Trade has questioned the policy (see 1411280009), Commerce held that products must have both extruded aluminum and non-extruded aluminum parts to qualify for the finished merchandise exemption, which the pallets do not. And even without the aluminum content requirement, the pallets are not finished merchandise because they can’t be used as pallets, Commerce said. Noting Zhongwang’s growing affiliate network, Commerce applied its scope ruling to “all extruded aluminum profiles consisting of series 1xxx aluminum alloy, which are cut-to-length and welded together in the form of a pallet,” regardless of producer or exporter, though the agency declined to apply its ruling to extrusions made from other aluminum alloys.
Email ITTNews@warren-news.com for a copy of the scope ruling.