Aluminum Pallets Subject to AD/CV Duties on Aluminum Extrusions, CAFC Says

A product must include non-extruded aluminum parts to qualify for the finished merchandise exemption from antidumping and countervailing duties on aluminum extrusions from China (A-570-967/C-570-968), the U.S. Court of Appeals for the Federal Circuit said in a Nov. 6 decision. Aluminum pallets imported by Perfectus Aluminum don’t have any such parts, and are covered by the AD/CVD orders, the appeals court said, affirming a Commerce Department scope ruling.

Permitting fully extruded aluminum goods from qualifying for the exemption “would allow the finished merchandise exclusion to swallow the rule established by the AD/CVD Orders and invite abuse,” the CAFC said. “Simply put, the AD/CVD Orders were intended to prevent importers from importing aluminum extrusions from China without paying antidumping duties and countervailing duties.”

The extruded aluminum pallets are also the subject of a criminal evasion case the Justice Department is pursuing against Perfectus and others in Central California U.S. District Court (see 1907310040), as well as an earlier forfeiture case (see 1802260028). Commerce also found that the pallets subsequently shipped to Vietnam are circumventing the China aluminum extrusions duties (see 1908090039).

Nonetheless, Perfectus also denied the existence of the pallets in its challenge of the scope ruling before the Federal Circuit court, arguing there’s no evidence of their current production or importation, as required for Commerce to issue scope rulings. “Ironically, Perfectus’s conduct in continuing to argue this case all the way through this appeal is a fairly strong indication that the impact of Commerce’s scope ruling is anything but hypothetical,” CAFC said.