CIT Upholds Commerce's AFA, Specificity Findings in Aluminum Extrusions CVD Case

The Commerce Department properly found that the Chinese government and countervailing duty respondent Jangho Group failed to respond to the best of their ability on whether aluminum extrusions producers are "authorities," the Court of International Trade ruled in a May 10 opinion. As a result, Commerce properly applied adverse facts available, Judge Leo Gordon ruled. Issuing his second opinion in the case after Jangho vied for a rehearing over its unaddressed "alternative arguments," Gordon also said that Commerce properly found that the provision of glass and aluminum extrusions below cost are specific subsidies.

Initially brought by Taizhou United, the case concerns the 2013 administrative review of the CVD order on aluminum extrusions from China. In a prior opinion, the court sustained Commerce's position on nearly all the contested issues. Judge Leo Gordon, however, remanded the agency's decision to countervail subsidized purchases of glass and aluminum extrusions. On remand, Commerce continued to find that the glass purchases are countervailable, even though they weren't used in the subject aluminum extrusions. Gordon upheld this position in February, finding the glass input is countervailable (see 2202180042).

In response, five of the plaintiff-intervenors filed for relief from judgment and for rehearing on claims that Jangho says the court didn't address (see 2203070030). Jangho argued that even if Commerce can countervail glass, the record doesn't support Commerce's finding that the suppliers are government entities, a benefit was provided or any benefit was specific in nature.

Gordon's May 10 opinion addresses these arguments, ultimately siding with Commerce and upholding the agency's final results. During the review, the Chinese government and Jangho said they weren't able to provide information on the specific companies that made aluminum extrusions and glass that the Jangho companies bought during the review period. The Chinese government said it wasn't able to procure this information, so Commerce used AFA, finding that the Chinese state and Jangho failed to cooperate by not acting to the best of their ability.

The plaintiffs argued that Jangho and the Chinese government fully cooperated with Commerce and responded to all inquiries to the best of their ability. The court disagreed. "To the contrary, while Plaintiffs highlight the information that GOC did provide in response to Commerce’s requests, Plaintiffs’ argument ignores the significant gap in the record left by the GOC’s failure to act to the best of its ability to provide all the information requested by Commerce," the opinion said. "Accordingly, the court sustains as reasonable Commerce’s finding that the application of AFA was warranted as well as Commerce’s determination that all the producers that produced the glass and aluminum extrusions purchased by Plaintiffs during the POR are 'authorities.'"

Jangho then challenged Commerce's positions that the provision of glass and aluminum extrusions for less than adequate remuneration were specific on an industry basis. While the plaintiffs pointed out a wide variety of uses for glass, they don't engage with Commerce's analysis of the record finding that the recipients of government authority-provided glass are limited in number to at least two and possibly four industries, Eaton ruled. As such, the government's conclusion is properly backed.

As for the provision of aluminum extrusions, Commerce legally used AFA over the specificity finding given the Chinese government's failure to provide information over the number of industries that buy aluminum extrusions directly. Like with glass, the plaintiffs pointed out a wide variety of uses for aluminum extrusions in a bid to show that they're not specific to a limited number of industries. Commerce said that what the Chinese government had not done, though, is suggest that the goods fall under "additional industries not considered." Commerce said that the Chinese government did not provide the quantity of aluminum extrusions consumed by the three to six industries identified on the record.

(Taizhou United Imp. & Exp. Co. v. United States, Slip Op. 22-43, CIT Consol. #16-00009, dated 05/10/22, Judge Leo Gordon. Attorneys: Douglas Heffner of Drinker Biddle for plaintiff Taizhou United; J. Kevin Horgan of deKieffer & Horgan for consolidated plaintiffs; Douglas Edelschick for defendant U.S. government; Alan Price of Wiley Rein for defendant-intervenors Aluminum Extrusions Fair Trade Committee)