Commerce Properly Established AFA in Reporting of US Payment Dates, CIT Rules

The Commerce Department properly found affiliated antidumping duty respondents Ghigi 1870 and Pasta Zara failed to cooperate to the best of their ability in reporting the U.S. payment dates for their pasta sales, the Court of International Trade ruled in a May 4 opinion made public May 13. Returning to the trade court to further explain its use of an adverse inference, Commerce said Ghigi's and Zara's errors in reporting their U.S. payment dates was due to "inattention and carelessness." Judge Richard Eaton agreed, upholding the remand.

The case involves the 22nd administrative review of the antidumping duty order on certain pasta from Italy, in which Ghigi and Zara served as one mandatory respondent. Following the questionnaire period, Commerce undertook a verification of Ghigi's U.S. constructed export price sales, when Ghigi told the agency that the U.S. payment dates were wrong due to a programming error. Ghigi subsequently requested Commerce revert to using its original database to get a more accurate list of the U.S. sales dates.

The agency declined, declaring that its practice is to use the most recently submitted data. Settling on using the wrong data, Commerce then found it couldn't verify the dates, and thus relied on facts available with an adverse inference. Judge Richard Eaton upheld Commerce's use of adverse facts available but not the adverse inference (see 2111300060). The judge said that an adverse inference can be used only when a respondent has been found to not cooperate to the best of its ability in the investigation. Eaton said Commerce didn't establish that here, so it cannot rightfully claim AFA.

On remand, Commerce maintained the adverse inference on the U.S. sales for which the correct date could not be found (see 2202280052). To establish the adverse inference, the agency looked to the U.S. Court of Appeals for the Federal Circuit precedent in Nippon Steel, which established the "best of its ability" standard. Commerce said Ghigi/Zara, as an experienced respondent that participated in past reviews, should have known the proper format regarding payment date submissions.

Eaton, in the case's second opinion, said Commerce has properly shown that the prongs of the Nippon Steel test are satisfied. The judge said Ghigi and Zara, as a seasoned respondent, "should have known what information was expected to be maintained," and the plaintiffs don't contest this finding. Eaton sided with the government's finding that the errors in the U.S. payment dates were due to inattention and carelessness.

"For Commerce, the unreliable reporting of Ghigi’s payment dates precluded Commerce from calculating an accurate weighted-average dumping margin for the mandatory respondent Ghigi/Zara," the opinion said. "('As the CREDITU [or credit expenses] adjustment is calculated based on the difference between the shipment date (SHIPDATU) and the payment date, these unreliable and inaccurate payment dates lead to incorrect values of CREDITU, an adjustment used in the calculation of the net U.S. price, and thus, to an inaccurate calculation of Ghigi/Zara’s dumping margins during the [period of review].'). Therefore, for the Department, 'Ghigi/Zara ... failed to cooperate to the best of its ability and hindered Commerce from timely completing its administrative review.'"

(Ghigi 1870 S.P.A. v. U.S., Slip Op. 22-41, CIT Consol. #20-00023, dated 05/04/22, Judge Richard Eaton. Attorneys: David Simon of Law Offices of David L. Simon for plaintiffs Ghigi 1870 and Pasta Zara and consolidated plaintiffs Agritalia and Tesa; Sosun Bae for defendant U.S. government)