AD Respondent Attacks Commerce's PMS Adjustment to Constructed Value

The Court of International Trade should remand the Commerce Department's particular market situation adjustment to an exporter's constructed value, the exporter, Garg Tube Export, argued in a Nov. 8 brief at CIT. Substantial evidence does not support Commerce's evidence of a PMS existing, so the holding should be remanded, Garg Tube said. Though Commerce correctly reversed its PMS adjustment to its sales-below-cost test for some Garg Tube products on a first remand, the agency should not have found a PMS existed at all for Garg Tube, the exporter said.

The brief comes in a case over the 2017-18 administrative review of the antidumping duty order on circular welded carbon steel standard pipes and tubes (CWP) from India. Garg Tube, a mandatory respondent to the proceedings, brought its case to CIT after Commerce made the PMS adjustment for hot-rolled coil, a key input for CWP, and saddled the respondent with partial AFA for the non-cooperation of the firm's unaffiliated suppliers. The court remanded both of these positions (see 2107210065), leading to the agency dropping its reliance on AFA and the PMS adjustment.

However, Commerce continued to make a PMS adjustment for some products where it based normal value on constructed value, which it did for CWP with control numbers that didn't have a home market sales price. Garg Tube is now contesting this position in its comments on the remand results. Commerce said that a PMS existed for HRC in India due to global steel overcapacity, the Indian government's trade interventions and Garg Tube's non-payment of antidumping and safeguard duties on hot-rolled coil imports.

Garg Tube said that when making this determination, Commerce failed to establish how the PMS altered prices between the normal value and export price, seeing as Garg Tube's CWP sold in both India and the U.S. were made with the same HRC inputs. The respondent also argued that the global steel overcapacity factor of the PMS "is the very antithesis to PMS in India, since it does not establish that market conditions in India differed from those in any other market." Garg Tube further argued that the market is predominantly filled with Indian HRC and that no overcapacity even existed.

The respondent also said that Commerce is distorting the court's remand order by continuing to make the PMS adjustment when normal value is based on constructed value. "Commerce’s Remand disingenuously asserts that it continued applying the PMS adjustment in the CV-based NV context 'because the CIT agreed that this is an appropriate adjustment ...,'" the brief said. "Commerce’s rationale distorts this Court’s opinion. ... Contrary to Commerce’s position, this Court’s endorsement of the PMS adjustment was not premised upon a subsidiary finding supported by substantial record evidence that 'a PMS interferes with its calculation of those costs.' In its prior decision, this Court did not address Garg’s claims that Commerce’s decision was unsupported by substantial evidence. Garg asks that this Court address these claims in its next decision."