AFA Rate Not Reasonably Representative of Separate Rate Respondents, Importer Tells CIT

The Commerce Department's simple average of the de minimis and the adverse facts available China-wide rates to derive the all-others rate in an antidumping case did not reasonably reflect the potential dumping margin of the separate rate respondents, PrimeSource Building Products argued in an Oct. 18 reply brief at the Court of International Trade. The AFA negates the presumption that mandatory respondents' rates reflect the separate rate respondents, and prior reviews show that cooperating separate respondents' rates are lower than firms subject to AFA, the brief argued (PrimeSource Building Products, Inc., et al. v. United States, CIT Consol. #20-03911).

The case stems from the fourth administrative review of the antidumping duty order on nails from Taiwan in which the two largest exporters, Bonuts Hardware Logistics Co. and Create Trading Co., were picked as the mandatory respondents. Bonuts did not respond to Commerce's questionnaires while Create sent in a letter saying it had no U.S. sales due to Commerce's reseller policy. The agency then dropped Create for Pro-Team Coil Nail Enterprise, the next largest exporter. Pro-Team also did not respond to Commerce's questionnaires.

In the CIT case over the review, brought initially by PrimeSource Building Products, none of the plaintiffs challenged the AFA rate given to Bonuts and Pro-Team; rather, they went after the use of the expected method. Responding to the plaintiffs' motion for judgment, DOJ said that "there should be no serious question as to the lawfulness of Commerce’s reliance on the expected method," relying on the Statement of Administrative Action from the Uruguay Round Agreements Act and the Albemarle decision (see 2108240045).

In its reply brief, PrimeSource made clear that it is not challenging the legal basis of Commerce's ability to apply the expected method. Instead, "the relevant legal question here is ... whether Commerce's selected methodology to calculate the non-selected respondents' rate was reasonable as applied," the plaintiff argued. PrimeSource said Commerce didn't explain how the reliance on AFA was "reasonably reflective" of the non-selected respondents' dumping margins.

Addressing the U.S.'s reliance on the Albermarle decision, PrimeSource said that this decision does not require strict adherence to the expected method in every instance, and in fact, the U.S. Court of Appeals for the Federal Circuit affirmed that Commerce can dump the expected method when it wouldn't reasonably reflect the potential dumping margins. "Albemarle, therefore, retains the underlying holding ... that the expected method is inappropriate when it results in a rate that is not a reasonable reflection of the non-selected respondents’ potential dumping margins," the brief said.

PrimeSource attacked Commerce's position that the use of the expected method was supported since the AFA rate given to the mandatory respondents was reflective of the dumping margins. This contention rests on two assumptions, PrimeSource said. One, that the mandatory respondents accounted for the largest volume of exports and thus, were representative of the non-picked companies, and two, that the AFA application in previous reviews is indicative of a trend of non-cooperation by all respondents. "Both assumptions are fundamentally flawed," the brief said.

"Firstly, it is true that the mandatory respondents are generally presumed to be representative of all exporters," the brief said. "That presumption, however, cannot stand, nor can it represent substantial evidence to support Commerce’s chosen calculation methodology, where the dumping margins for the mandatory respondents are assigned using AFA. Secondly, record evidence does not establish a trend of noncooperation by all exporters, but instead shows that the cooperating non-selected respondents’ dumping margins are different from the uncooperative mandatory respondents’ dumping margins."