Recent CAFC Decision Backs US Position on Role of Electricity in CVD Review, DOJ Tells Trade Court

A recent U.S. Court of Appeals for the Federal Circuit decision bolsters the U.S.'s case in a dispute over whether China's provision of electricity qualifies as a countervailable benefit, the Department of Justice said in a Feb. 7 notice of supplemental authority submitted to the Court of International Trade. On Jan. 28, the Federal Circuit said that Commerce can use adverse facts available over the Chinese government's failure to provide information on its price-setting practices in a countervailing duty review concerning its provision of electricity (see 2201280033). In a case brought by Risen Energy Co. related to the subsequent review of the same CVD order on solar cells from China, DOJ told the trade court that the January decision backs its argument (Risen Energy Co., Ltd. v. United States, CIT #20-03912).

Risen and the other plaintiffs challenge Commerce's decision that the provision of electricity for less than adequate remuneration was regionally specific. DOJ told the Federal Circuit that its own ruling found AFA was valid when filling "two critical information gaps raised in the record," such as why prices differ from province to province and who sets the distinct price in each province. "In this case, Commerce reasonably relied on adverse inferences to fill the same gaps in the record," DOJ said.

The Federal Circuit decision also runs counter to the argument that Commerce was required to identify a particular subsidized region, the notice argued. "The Canadian Solar court explained that 'where documents support the inference that the central government of China was involved in provincial electricity pricing that results in regional price variability, substantial evidence supports Commerce’s finding that there is a countervailable regionally specific subsidy,'" DOJ said.