CIT Orders Remand on Labor, Adverse Facts in China Shrimp Investigation

Chinese exporter Shantou Red Garden Foodstuff Co., Ltd. challenged the International Trade Administration‘s decisions in the less-than-fair value investigation of certain frozen warmwater shrimp from China¹ which was conducted from April through September 2003. Red Garden contested the ITA's: 1) use of adverse facts for cost data the firm was unable to obtain from one of its suppliers; 2) choice of surrogate values for shrimp and shrimp feed; 3) choice of surrogate financial ratios; 4) use of inaccurate production volume data for one supplier; 5) use of inappropriate labor rates; and 6) refusal to accept corrections to factors-of-production calculations submitted prior to verification.

The court granted the ITA a voluntary remand to apply the agency’s new labor rate methodology for non-market economies (NMEs), and to use the corrected factors data. The court also ordered the ITA to: 1) remove the adverse inference regarding another suppliers’ factors of production; 2) revise the selection of a surrogate value for head-on, shell-on shrimp; 3) use corrected volume and cost data for two suppliers; and 4) consider revising its rejection of one suppliers‘ reported costs for “growth stage multiplier” (a production input). The court denied Red Garden’s challenges to the ITA’s selections of a surrogate value for shrimp feed and of surrogate financial ratios.

(See ITT's Online Archives 11062120 for summary of the ITA's new labor rate methodology for NMEs.)

¹The scope of the investigation was originally defined as “certain warmwater shrimp and prawns, whether frozen or canned, wild-caught (ocean harvested) or farm raised (produced by aquaculture), head-on or head-off, shell-on or peeled, tail-on or tail-off, deveined or not deveined, cooked or raw, or otherwise processed in frozen or canned form, but the scope of the antidumping duty order excluded “canned warm water shrimp and prawns” due to a finding by the U.S. International Trade Commission that “a domestic industry in the United States is not materially injured or threatened with material injury.”)

(CIT Slip Op. 12-7, dated 01/13/12)