No Statutory Basis for CVD Expedited Reviews, Lumber Trade Group Tells Federal Circuit

The Court of International Trade properly found that there was no statutory basis for conducting expedited countervailing duty reviews, plaintiff-appellee Committee Overseeing Action for Lumber International Trade Investigations or Negotiations told the U.S. Court of Appeals for the Federal Circuit in a Jan. 31 reply brief. The language in certain sections of the Uruguay Round Agreements Act doesn't establish that Congress "clearly and unambiguously" meant for Commerce to set up CVD expedited review procedures, the committee said (Committee Overseeing Action for Lumber International Trade Investigations or Negotiations v. United States, Fed. Cir. #22-1021).

The case stems from a January 2018 CVD order on certain softwood lumber from Canada. In March of that year, Commerce conducted an expedited CVD review for various Canadian lumber companies that were assigned the all-others rate. The Canadian producers received de minimis CVD rates as a result, rendering them exempt from the order. However, the question of whether Commerce had the right to conduct the expedited review loomed over the proceedings. CIT said there wasn't and that Section 103(a) of the URAA didn't work as a legal home for Commerce's regulation establishing the reviews (see 2108190002).

The Canadian federal government, along with the governments of Quebec and New Brunswick and six Canadian companies, appealed to the Federal Circuit. In their opening brief, the plaintiff-appellants pushed for Section 103(a) as justification for the process, since it provides for officers of the U.S. government to issue regulations necessary to ensure that any part of the URAA is "appropriately implemented" (see 2112280025). This section is relevant since the U.S. signed the WTO Agreement on Subsidies and Countervailing Measures, a part of the URAA, which requires signatories to provide a procedure in their domestic CVD laws where non-individually examined respondents can get an expedited review.

The committee responded by arguing that the legislative history further reveals that Congress didn't anticipate that additional administrative proceedings, including the CVD expedited reviews, were necessary for the SCM Agreement. "It is well-established that WTO agreements, including the SCM Agreement, are not self-executing," the brief said. "This understanding is reflected in the legislative history of the URAA, where Congress explicitly stated that the WTO agreements 'are not self-executing and thus their legal effect in the United States is governed by implementing legislation.'"

Given that WTO agreements are not self-executing, Congress' actions to approve these agreements in the URAA don't authorize Commerce to implement them through regulations that they believe Congress has failed to address, the committee said. "Allowing Commerce to nonetheless effectuate administrative proceedings -- like the 'CVD expedited reviews' -- through regulation would authorize the executive branch to make law while transforming a non-self-executing agreement into a self-executing one, an outcome specifically prohibited by the Supreme Court in [Medellin v. Texas]. ... Vesting such authority with an administrative agency violates the constitutional principle that 'the power to make the necessary laws is in Congress; the power to execute in the President.'"