CAFC Opinion on AFA Application to Cooperative Respondent Surfaces in CIT Case

A recent U.S. Court of Appeals for the Federal Circuit decision finding that antidumping duty countrywide rates in non-market economies can still be based on adverse facts available even if no respondents were uncooperative in an administrative review (see 2106100044) will be considered in a Court of International Trade case on the Commerce Department's AFA policy, according to a June 14 notice of supplemental authority from the Department of Justice. The Federal Circuit decision in China Manufacturers Alliance, LLC v. United States "substantially overlaps" with a CIT case over Commerce's NME policy brought by Jilin Forest Industry Jinqiao Flooring Group Co., DOJ said (Jilin Forest Industry Jinqiao Flooring Group Co., Ltd., v. United States, CIT #18-00191).

After originally opposing a motion to stay proceedings pending the Federal Circuit opinion in China Manufacturers Alliance at first, Jilin reversed course in a June 15 response to the stay motion, saying that the case should be stayed until the Federal Circuit issues its final mandate. CIT subsequently stayed proceedings in a June 16 order, instructing both Jilin and DOJ to file briefs on how the CAFC decision affects the issues remanded in Jilin's case. DOJ previously moved to stay Jilin's case pending the CAFC opinion before judgment was issued (see 2105270027).

In Jilin's case, Judge Richard Eaton remanded an antidumping administrative review on multilayered wood flooring from China to Commerce. The judge found that Commerce's decision to find Jilin de facto controlled by the Chinese government was made without substantial evidence and that the agency's application of its NME policy cut against its original intent -- to incentivize greater compliance with antidumping proceedings (see 2104300079).

The Federal Circuit opinion said that a countrywide rate can be based on AFA despite full responsiveness from a particular respondent. "Commerce may permissibly assign [individually investigated rate] to the unitary group of exporters in an NME country that have failed to rebut the presumption of government control," the CAFC opinion said. "This rate may be based in whole or in part on {facts available} or {adverse facts available}, and Commerce may carry forward an initial NME entity rate, including adverse inferences built into that rate, in subsequent administrative reviews."