Court of International Trade

In a dispute over the price benchmarks the Commerce Department uses to value subsidy programs in countervailing duty proceedings, the Court of International Trade remanded the results of the original countervailing duty investigation on aluminum extrusions from China (C-570-968). Commerce had found government-associated companies had provided aluminum and land inputs to Chinese companies for below-market prices, or “less than adequate remuneration (LTAR),” which meant those inputs were countervailable subsidies. CIT said Commerce was correct in including import duties in the benchmark market price it used to judge whether aluminum inputs were provided for LTAR. The regulations require Commerce to do so, the court said. But Commerce’s comparison of a fully-developed Thai industrial park with undeveloped land received by respondent Zhongya went against the evidence on the record, the court said. CIT remanded for Commerce to reconsider.

The Court of Appeals for the Federal Circuit rejected a test used by the Commerce Department to determine if items covered by antidumping duty orders, but included in non-subject sets, are subject to AD duties. But while it found fault with the particulars of the test Commerce used to see whether Target’s nails are included under the AD duty order on China, the appeals court reversed a 2012 Court of International Trade ruling that said Commerce wasn’t allowed to perform any test at all on the “mixed media items.” Instead, the appeals court put forward its own test for when this issue arises, both in this Target case and in future cases, and appealed to Commerce to clearly define its mixed media analysis procedures for future cases.

In a case on the tariff classification of Latitudes International Fragrance’s diffuser bottles, the Court of International Trade ruled July 17 that the product is a bottle for the conveyance of scented oil, rather than decorative glassware. Latitudes, a U.S. importer doing business as Maesa Home, argued the bottles are simple vessels bought for the scented oil and reeds they contain. The court agreed, finding the bottles’ decorative function was secondary.

The Court of International Trade sustained a scope ruling that found thermal paper jumbo rolls produced in a third country but converted to thermal paper ready for consumer use by Paper Resources in China to be outside of the scope of the antidumping duty order on lightweight thermal paper from China (A-570-920).

The Court of International Trade remanded the rescission of a new shipper review on fresh garlic from China for Jinxiang Yuanxin Import & Export. Commerce had ended the proceeding because it found Yuanxin’s only sale under review wasn’t commercially bona fide and reviewable. The sales price was too high, the sales quantity was too low, and the sale was made under strange circumstances, Commerce said. The rescission had resulted in Yuanxin’s garlic continuing to be subject to the high China-wide rate. But the court found fault with Commerce’s decision to compare the price and quantity of Yuanxin’s sale of single-clove garlic to CBP data on imports of fresh whole garlic.

The Court of International Trade sustained the rescission of a new shipper review on uncovered innerspring units from China (A-570-928), finding reasonable Commerce’s decision to end the review, and keep Foshan Nanhai Jiujiang Quan Li Spring Hardware Factory and Foshan Yongnuo Import & Export subject to the China-wide rate. The companies had requested the new shipper review in an attempt to get their own lower separate rate. Commerce had said the sale up for review was too small and expensive to be a normal commercial sale. It also said the importer couldn’t get its story straight on the circumstances of the sale. Foshan challenged the quantity and value comparisons the agency used to find the sale abnormal, and put forward its own theory on what the importer was trying to say. But CIT said Commerce’s determination was reasonable, and supported by evidence.

The Court of International Trade again dismissed Hartford Fire Insurance Company’s attempt to void or discharge bonds securing duties on entries made by an importer that violated U.S. import laws. CIT previously dismissed some of the claims brought by Hartford (see 12081428), but had allowed the surety to amend its complaint to say CBP abused its discretion by not requiring the importer to post a cash deposit instead of a bond. CIT granted CBP's motion to dismiss for failure to state a claim.

The Court of International Trade sustained the rescission of a new shipper review on fresh garlic from China for Zhengzhou Huachao Industrial, agreeing with Commerce’s determination that the company’s sale under review wasn’t commercial in nature. The high price, low quantity, and unusual circumstances of the sale meant it wasn’t bona fide, and couldn’t form the basis for a separate antidumping duty rate, Commerce had said. In the face of Zhengzhou Huachao’s challenge, the court found each of Commerce’s findings reasonable.

Beta carotene tablets imported by Roche Vitamins are correctly classified in the Harmonized Tariff Schedule as provitamins, said the Court of International Trade, ruling against CBP’s proposed classification as food preparations. The case had been subject to an earlier ruling in 2010, where the court found factual disputes still existed as to the use of the tablets, and ordered a trial. After trial, CIT found the tablets are predominantly used as a source of provitamin A.

The Court of International Trade sustained the Commerce Department’s determinations on the last remaining issues from the 2003-03 antidumping duty administrative review on fresh garlic from China (A-570-831). The court had remanded the final results twice before. The final issues remaining in this remand redetermination were related to valuation of surrogate inputs, including labor. Because the domestic petitioners didn’t submit comments during the remand proceeding, the court ruled that they didn’t exhaust their administrative remedies, and sustained. As a result, AD rates for the 2002-03 period of review will fall to zero for Zhengzhou Harmoni Spice Co., Ltd.; Jinan Yipin Corporation, Ltd.; Linshu Dading Private Agricultural Products Co., Ltd.; and Sunny Import & Export Co., Ltd.