Case Set for Settlement After Commerce Finds Sewerage Program Not Countervailable

The Court of International Trade told litigants in a paperless order to file a proposed stipulated judgment in a countervailing duty case after a resolution of the matter was reached following a voluntary remand from the Commerce Department. Commerce said that a South Korean sewerage fees program was not countervailable, leading to a de minimis rate for plaintiff Hyundai Steel Company. In a March 9 joint status report, Hyundai and the U.S. said that case was resolved following the voluntary remand (Hyundai Steel Company v. United States, CIT #21-00012).

The case concerns the 2018 CVD administrative review of cut-to-length carbon-quality steel plate from South Korea. In the East Asian country, the regional government water authority assumes that however much water a customer consumes equals the amount of sewerage it discharges into the public sewer system. The customers are therefore charged for this sewerage based on the level of water consumed. However, if a customer can prove that it did not discharge as much sewerage as the amount of water it consumed, that customer can be charged at the actual rate of water usage.

Hyundai said it uses water as part of its production process. Therefore, the company hired an "independent study" to find its actual level of sewerage. This study was accepted by the regional Korean water authority, lowering Hyundai's level at which it is charged for water consumption (see 2106240047). The CVD petitioner alleged that this was a countervailable benefit to Hyundai. Commerce initially agreed, prompting Hyundai to file its case. During litigation, Commerce requested a voluntary remand since its understanding of the program increased following the 2019 administrative review of the CVD order (see 2111080050). Commerce, on remand, said that it now finds that both federal and municipal law and regulations show that sewerage fees are based on the volume of sewage discharged into the public sewerage system rather than just the amount of water consumed, making the program not countervailable (see 2202070063).