Petition Filed for New AD/CV Duties on Canadian Civil Aircraft Targets Future Imports
Boeing is asking for the imposition of antidumping and countervailing duties on 100-seat to 150-seat large civil aircraft from Canada, it said in petitions filed with the Commerce Department and International Trade Commission on April 27. The petition, which targets Bombardier’s CS100 and CS300 passenger aircraft, says the Canadian company’s goal is “muscling its way into the U.S. aviation market by offering its heavily subsidized planes at cut-rate pricing.” Boeing says Bombardier is following the playbook set by Airbus when it “helped drive U.S. competitors Lockheed and McDonnell Douglas out of the commercial airplane market by selling its subsidized aircraft at below-market prices.”
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The petition is notable because it targets aircraft that have been bought but not yet imported. But antidumping and countervailing duty laws apply to merchandise “sold (or likely to be sold) for importation.” The “likely to be sold” language “is particularly important in cases involving large capital equipment, where loss of a single sale can cause immediate economic harm and where it may be impossible to offer meaningful relief if the investigation is not initiated until after importation takes place,” Congress has said in a bill report, according to Boeing. “In cases where injury or threat of injury from a subsidy may occur prior to actual importation, the investigation should not await such importation.”
“This is exactly the case here,” the petition said. Delta has ordered 75 Bombardier C-series aircraft and is scheduled to begin taking delivery in 2018, the petition said. This single sale “caused Boeing immediate economic harm. Given Bombardier's contractual obligation to fulfill Delta's large firm order, significant subject imports -- and a significant increase in subject imports' market share at the expense of the domestic like product -- are virtually certain,” the petition said. “And the terms of this order are already fixed at prices that are absurdly low. Bombardier's subsidized dumping at Delta established a new, low price ceiling that will depress Boeing prices, revenues, and profits even further.”
Proposed Scope
The petition proposes the following scope for the investigations:
The merchandise covered by this petition is aircraft that have a standard 100- to 150-seat two-class seating capacity and a minimum 2,900 nautical mile range, as these terms are defined below.
"Standard 100- to 150-seat two-class seating capacity" refers to the capacity to seat 100 to 150 passengers on commercial airline routes, when the aircraft contain 8 passenger seats configured for a 36-inch pitch, and the remaining passenger seats are configured for a 32-inch pitch (regardless of actual seating configuration). For example, aircraft with a "standard 100- to 150-seat two-class seating capacity" can be configured with fewer than 100 seats (e.g., a CS100 with an all business class configuration). "Pitch" refers to the distance between a point on one seat and the same point on the seat in front of it.
Having a "minimum 2,900 nautical mile range" means:
(i) able to transport between 100 and 150 passengers and their luggage on routes equal to or longer than 2,900 nautical miles; or
(ii) covered by a U.S. Federal Aviation Administration ("FAA") type certificate or supplemental type certificate that also covers other aircraft with a minimum 2,900 nautical mile range.
The scope includes all aircraft covered by the description above, regardless of whether they enter the United States fully or partially assembled, and regardless of whether, at the time of entry into the United States, they are approved for use by the FAA.
The merchandise covered by this investigation is currently classifiable under Harmonized Tariff Schedule of the United States ("HTSUS") subheading 8802.40.00.40. Although this HTSUS subheading is provided for convenience and customs purposes, the written description of the scope of the investigation is dispositive.
Commerce Accepting Comments on Petition Support
The Commerce Department is accepting comments on domestic industry support for the petitions to determine whether the petitions meet the dual requirements of support by domestic producers or workers accounting for (1) at least 25% of the total production of the domestic-like product and (2) more than 50% of the production of the domestic-like product produced by that portion of the industry expressing support for, or opposition to, the petition. If the petitions meet these requirements, among others, Commerce will initiate antidumping and countervailing duty investigations. Comments are due on or about May 21.
Email ITTNews@warren-news.com for a copy of the petition.