CIT Remands All-Others Rate in China Aluminum Extrusions

The Court of International Trade remanded the all-others rate from the final countervailing duty determination of aluminum extrusions from China (C-570-968) to the International Trade Administration for further consideration and explanation. Domestic plaintiffs challenged the ITA’s decision to entirely base the 374.15% all-others rate on the non-cooperative mandatory respondents’ adverse facts available (AFA) rate of the same amount, and omit voluntary respondents’ rates from the all-others calculation. According to plaintiffs, this decision was prohibited by the governing statute, based on an invalidly promulgated regulation, and unreasonable and not supported by substantial evidence. CIT disagreed with plaintiffs' first two arguments, but agreed that the ITA’s methodology was unreasonable and remanded.

CIT Rules Decision to Omit Voluntary Respondent Rates Valid

Plaintiffs argued that the ITA’s decision to omit any rates calculated for voluntary respondents is expressly prohibited by the governing statute, 19 USC 1671d, because the statute unambiguously requires that the all-others rates be based on “all individually investigated respondents”, including voluntary respondents. As a result, concluded plaintiffs, 19 CFR 351.204(d)(3), which excludes voluntary respondents from the all-others rate, is invalidly promulgated because it conflicts with the statute at issue. The ITA responded that the statute is ambiguous, and that voluntary respondents are unrepresentative of the all-others companies because respondents will voluntarily seek review only when they believe that their rates will be lower than those set for the mandatory respondents.

The CIT agreed with the ITA that the statute is ambiguous, citing ambiguity within the statute about whether the phrase “all individually investigated respondents” in section 1671d includes voluntary respondents. Finding the statute to be ambiguous, the CIT also said the ITA’s explanation for non-inclusion of voluntary respondents in all-others calculations to be reasonable, and found that 19 CFR 351.204(d)(3) was validly promulgated as a reasonable interpretation of the statute.

ITA’s Choice of All-Others Rate Unreasonable

However, the CIT found that with the ITA’s choice to set the all-others rate as equal to the AFA rate for the mandatory respondents was unreasonable. The ITA said it took this action because there were no calculated rates for individually investigated mandatory respondents on the record. The CIT disagreed with the ITA’s logic because: (1) this situation was of the ITA’s own making, because the ITA could have identified other mandatory respondents; (2) the voluntary respondents’ rates, while prohibited by regulations for use in calculating the all-others rate, were on the record and demonstrated that the AFA rate was not attributable to all respondents; (3) the mandatory respondents upon which the all-others rate was based were not a representative, valid sample; and (4) in light of the precedent that an AFA rate is to be remedial, not punitive, nothing on the record indicates that the ITA considered how to serve that purpose.

CIT Remands Final Determination to ITA for Reconsideration

The CIT remanded the ITA’s all-others calculation in order to allow the ITA to make a reasonable decision, considering the important aspects of the problem presented, and explain why that decision complies with the statutory reasonableness requirement. The ITA’s remand results are due by May 4, 2012.

(Slip Op. 12-47, dated 04/04/12, Judge Pogue)