Commerce Free to Decide Fabricators Aren't Producers for Industry Support, DOJ Says

The Commerce Department acted within its authority when it decided not to include the views of countertop fabricators in its industry support determination before beginning antidumping and countervailing duty investigations on quartz surface products from India, the Department of Justice said in a brief filed May 26 responding to an importer’s motion for judgment in the case.

The importer, M S International, says that Commerce was bound to include fabricators in its industry support calculation by the governing statutes, which provides that interested parties eligible to file a petition -- namely manufacturers, producers or wholesalers -- must be considered, DOJ said in its brief.

But Commerce says the ambiguity in the statute -- producer is never defined -- means it has discretion to develop its own process to determine whether an entity should be included in the industry support calculation. The agency uses the same six-factor test that the International Trade Commission uses to evaluate whether an entity is part of the domestic industry for the purposes of determining injury. Before beginning the quartz surface products investigation, Commerce examined evidence related to the six factors and determined fabricators don’t qualify, DOJ said.

“MSI portrays the matter as a Chevron step one issue by arguing that the statute defines the domestic industry to include all producers of the domestic like product and that both fabricated and unfabricated quartz surface materials are included in Commerce’s investigation,” DOJ said. “The fundamental flaw in MSI’s reasoning is that it elides the question of whether entities that perform processing on a pre-existing product -- such as the fabricators at issue in this case -- have a sufficient stake in the domestic industry to be considered 'producers' for industry support purposes.”

MSI also argued that the ITC eventually came to a contradictory conclusion, but “the ITC and Commerce maintain separate records, have different statutory roles, and although both consider each other’s decisions as they are available throughout their separate processes, they make their determinations based on the evidence from their respective records,” DOJ said. “It is not unprecedented for Commerce and the ITC to reach different determinations regarding composition of the domestic industry for their respective purposes of determining industry support and injury.”