Court of International Trade

The U.S. Court of Appeals for the Federal Circuit on April 14 upheld a lower court ruling in a contentious dispute over CBP’s reclassification of white sauce imported by International Custom Products. As it had foreshadowed during oral argument, CAFC ruled that a CBP notice of action effectively revoked a 1999 ruling letter on the white sauce, which means it was an “interpretive ruling or decision” that should have been subject to notice and comment under 19 USC 1625(c).

The Court of International Trade on April 11 mostly upheld the results of the Commerce Department’s countervailing duty investigation on large residential washers from South Korea, in the face of a challenge from Samsung Electronics. Among other things, Samsung challenged Commerce’s finding that a subsidy was “specific” -- in order to be countervailable, a subsidy has to be targeted at a limited group of companies. The court ordered Commerce to reconsider its determination that a tax credit program was in effect specific because Samsung was given a large percentage of the total subsidies disbursed. The high proportion wasn’t enough to find the subsidy specific; Commerce needed to consider other underlying factors, said CIT. But the trade court sustained Commerce’s determination that the tax credit was specific because it was only available in a certain region. Samsung protested that the region where the subsidy was available comprised 98% of the country of South Korea, but CIT said it doesn’t matter how big the area is, only that it’s a limited area.

The Court of International Trade is proposing an amendment to its rules on discovery and depositions. The rule change would delete CIT Rule 26.1, which says “the party requesting the deposition, unless otherwise provided for by stipulation or by court order, will pay all costs, charges, and expenses incident to taking it.” CIT said it’s making the change so that its own rules are consistent with the Federal Rules of Civil Procedure. Comments are due May 8.

Antidumping duty cash deposit rates for two exporters of steel grating from China may fall, as the Court of International Trade on April 9 sustained a recalculation by the Commerce Department. CIT had in 2012 ordered Commerce to take another look at the rates from the original AD duty investigation (see 12071907). In response, Commerce kept Ningbo Jiulong Machinery Manufacturing Co.’s rate at 145.18%, but lowered the rates it assigned to Yantai Xinke Steel Structure Co. and Ningbo Haitian International Co. from 136.76% to 38.16%. Because no new rates have been set in administrative reviews since the AD duty order on steel grating was issued in 2010, these rates, if finalized, will become the new cash deposit rates for these companies. The ruling is still subject to appeal, however, and Commerce said it completed the recalculation “under protest.” Parties have 60 days to appeal a court ruling.

An importer’s request that CBP disclose business confidential information for use in a tariff classification lawsuit has been put on hold by the Court of International Trade. FDK America is asking for a court order to make CBP provide documents underlying a 2002 customs ruling requested by another company called Nortel. FDK says the 2002 ruling is directly related to its own challenge of a 2011 ruling on the tariff classification of optical isolators it imported from Sri Lanka. But Nortel has since gone bankrupt, and neither CBP nor FDK have been able get an answer from the now-defunct company on whether or not CBP can disclose the information. FDK said the technology revealed by the supporting documentation is so old that there’s no way its disclosure could hurt Nortel. It also said its attempts to date to get permission should suffice. But CIT wanted a more formal attempt before it gives away Nortel’s confidential information, and said it will wait for the result of a subpoena.

Correction: The Court of International Trade on March 31 remanded the antidumping duty rates from the original investigation on wood flooring from China (see 14040104). Commerce had calculated zero AD rates for Layo and Samling, but CIT refused to accept the new rates because of concerns over other AD rates assigned to non-individually investigated “separate rate companies.”

The Court of International Trade again told the Commerce Department to reexamine the antidumping duty rates it assigned in the original investigation of wood flooring from China. CIT had remanded the results of investigation in August 2013 (see 13080202). In response, Commerce lowered the AD rates it assigned to Layo and Samling to zero, which if affirmed would exclude those companies from AD duties. CIT declined to affirm, however, because at the same time that Commerce lowered the rates for the two individually-reviewed companies, it “incongruously” raised the rates for 74 non-individually reviewed companies.

The Court of International Trade affirmed lower antidumping duty rates for three exporters of fresh garlic from China (A-570-831) from an administrative review covering entries from the period Nov. 1, 2003 to Oct. 31, 2004. In response to court remands over issues related to surrogate values, the Commerce Department lowered the AD rate for Jinan Yipin Co., Ltd. from 29.52% to zero; Linshu Dading Private Agricultural Products Co., Ltd. from 22.47% to zero; and Sunny Import & Export Limited from 10.52% to 0.04% (a de minimis rate). CIT sustained the new rates over the objections of domestic industry.

The Court of International Trade on March 27 ordered Commerce to reconsider the antidumping duty rate it assigned to CS Wind Corporation in the agency’s AD duty investigation on wind towers from Vietnam (A-552-814). The court took issue with the “surrogate values” used by Commerce to find the market economy-equivalent costs of some of CS Wind’s inputs. CS Wind was assigned a 51.5% AD duty rate in the final determination.

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.”