Trade Court Sends Back Elements of AD Admin Review on Frozen Fish Fillets From Vietnam

The Court of International Trade remanded elements of the Commerce Department's administrative review of the antidumping duty order on frozen fish fillets from Vietnam. In an April 25 opinion made public May 3 submitted in two cases -- one brought by the sole mandatory respondent NTSF Seafoods Joint Stock Co. and the other by Catfish Farmers of America, et al. -- Judge M. Miller Baker sent back parts of the review that deal with Commerce's position over whether Indonesia has a comparable level of economic development to Vietnam, whether the Indian factors of production data are the best available as compared to Indonesia, Commerce's failure to engage with contradicting evidence over NTSF's ratio of whole live fish to fillets and the moisture content of NTSF's fillets.

Many challenged elements of the review stem from Commerce's selection of a surrogate country, given that Vietnam is a non-market economy. In the review, Commerce identified six potential surrogate countries, one of which was India. While Indonesia was not identified as one, Catfish Farmers submitted data promoting Indonesia as a surrogate pick. In its case, Catfish Farmers argued that India should have been disqualified as a surrogate since it was not a significant producer of comparable merchandise and even if it was, Commerce still should have used Indonesia since it has a comparable level of economic development to Vietnam and has superior data compared to India's.

First addressing the question of India's eligibility as a surrogate country, Baker said that Catfish Farmers failed to address Commerce's point that the AD order doesn't distinguish between grades of subject merchandise, making India a producer of comparable merchandise. Over whether Indonesia is at a comparable level of economic development, Baker remanded the case so Commerce can address this point using the same World Bank gross national income data it used to find that India was at a comparable level of economic development.

Turning to whether the Indian or Indonesian data is better, Catfish Farmers argued that the Indian data cannot be the best since it doesn't represent a broad market average. Baker said that the plaintiff pointed out proper contradicting evidence to the agency's position that 80% of production in India came from one state, Andhra Pradesh, calling into question which country's data was better. Catfish Farmers also attacked Commerce's Indian wage and labor data, which it nabbed from 2006.

"The Department cannot simply select data from 11 years before the period of review without explaining the reason for disregarding the temporal disconnect, and it certainly cannot make false statements about contemporaneity as it did here," the opinion said. "Commerce’s unexplained decision to use 2006 Indian data to value labor inputs is thus not supported by substantial evidence and the court will therefore remand as to that issue as well." In all, Baker remanded to reconsider whether Indonesia is also economically comparable to Vietnam and whether the Indian factors of production are the best available information when compared with the Indonesian data.

Elsewhere in the Catfish Farmers case, Baker actually upheld NTSF's reported factors of prodcution. The judge found that NTSF properly followed Commerce's instructions relating to its fish fillets not meant for the U.S. and in its use of standard usage rates. Where Baker did remand NTSF's reporting was where it related to Commerce's failure to address detracting evidence surrounding NTSF's ratio of whole live fish to fillets in its shipments.

The judge also sent back the case to Commerce so it could reconsider the moisture content of NTSF's shipments. Catfish Farmers alleged that NTSF overstated the amount of water in its finished frozen fish fillets and understated the amount of actual fish. Baker found that Commerce didn't address any of the record evidence on this point and so it must do so on remand.

While Baker remanded parts of Catfish Farmers' case, he was not so favorable to the plaintiff in his rulings on NTSF's arguments. The respondent challenged Commerce's use of partial adverse facts available relating to its supposedly inadvertent failure to report its affiliate's -- Vinh Long's -- farming factors. NTSF admitted to the gap in the record over these factors, permitting the use of partial AFA. However, NTSF says Commerce based its adverse inference on what percentage of overall harvested fish at the NTSF and Vinh Long farms came from Vinh Long farms rather than the percentage of Vinh Long's fish used in making fish fillets sold to the U.S.

"Commerce clearly found that the gap in the record -- the omission of Vinh Long’s factors of production consumption data -- pervaded all NTSF’s control numbers because Vinh Long’s data were, or should have been, included in the framework for the calculations used for those control numbers," the judge said, upholding the use of AFA.

NTSF also argued that Commerce erred by rejecting the respondent's ministerial error allegation over the inclusion of expenses the company reported in a particular database field and including those expenses in the calculation of its export price. Baker ultimately sided with Commerce on this issue, holding that since NTSF never said that this was wrong until after the review's final determination was out and since its own case brief urged Commerce to use both data fields, the challenge fails.

(NTSF Seafoods Joint Stock Co. v. United States and Catfish Farmers of America, et al. v. United States, Slip Op. 22-38, CIT #20-00104 and #22-00105, dated 04/25/22, Judge M. Miller Baker. Attorneys: Jonathan Freed of Trade Pacific for NTSF; Jonathan Zielinski of Cassidy Levy for plaintiff Catfish Farmers of America et al.; Kara Westercamp for defendant U.S. government)