Commerce Rightly Didn't Exclude Tires From AD Scope Despite History of the Scope, DOJ Says

The Commerce Department reasonably found that exporter Cheng Shin Rubber Ind. Co.'s tires did not qualify for a scope exclusion for light truck spare tires despite the petitioner agreeing to include specific exclusion language for Cheng Shin's tires, DOJ said in an April 13 reply brief at the Court of International Trade. The exclusion requires that the tires be designed and marketed exclusively as temporary use spare tires for light trucks, and enough evidence sits on the record showing that this wasn't the case for Cheng Shin, the brief said (Cheng Shin Rubber Ind. Co. v. United States, CIT #21-00398).

Cheng Shin requested from Commerce an exclusion for the light-truck spare tire models it made for a U.S. customer from the antidumping duty investigation on passenger vehicle and light truck tires from Taiwan. The company wanted a separate category for light-truck spare tires since the category currently available, "tire service type," did not separately identify light-truck spare tires. The petitioner agreed that these spare tires should be excluded and, after some haggling, helped come up with exclusion language for Cheng Shin's tires.

But Commerce's final version of the product-characteristic reporting requirements did not include a separate "tire service type" category for the light-truck spare tires. This led to the spare tires being included in the investigation. This led Cheng Shin to take its case to CIT, where it argued that the scope language was drafted specifically to exclude the light-truck spare tire models made by Cheng Shin (see 2109090056).

In its reply brief, DOJ argued that there's plenty of evidence to show that Cheng Shin's tires don't qualify for the terms of the exclusion. "Cheng Shin’s purchase agreements and technical drawing that it submitted with its response to Commerce’s in-lieu-of-verification questionnaire showed that these tires could be used as either passenger car or light truck tires," clearly violating the terms of the exclusion, which require that the tires be designed and marketed only as temporary use spare tires for light trucks.

Further, Commerce argued that Commerce ultimately comes up with the language of a scope "regardless of any agreement on scope language among the parties." While the petitioner agreed to include an exclusion for light truck spare tires that checked off certain boxes, it did not agree that Cheng Shin's tires satisfied these criteria, Commerce said.