Tokyo Steel Challenges Section 232 Deduction From US Price, Affiliate Adjustment for Input Purchase

The Commerce Department improperly deducted Section 232 steel and aluminum duties from antidumping respondent Nippon Steel's U.S. price in an antidumping review, non-selected company Tokyo Steel Manufacturing said in a June 22 complaint at the Court of International Trade. Further, the agency erred by increasing the total cost of manufacturing to account for Nippon Steel's purchases of iron ore from its affiliated suppliers, the brief said (Tokyo Steel Manufacturing v. U.S., CIT #22-00180).

The case contests the 2019-2020 administrative review of the antidumping duty order on hot-rolled steel flat products from Japan in which Nippon Steel was tapped as a mandatory respondent. The company ended up with a 24.07% dumping margin, meaning Tokyo Steel got the same as a non-examined company.

Tokyo Steel in its two-count complaint initially challenged the deduction of Section 232 duties from the respondent's U.S. price -- a position the trade court has repeatedly struck down. The exporter said Section 232 duties aren't like ordinary customs duties and are more similar to antidumping and Section 201 duties, which are not deducted from U.S. price.

Tokyo Steel also said it was illegal for Commerce to increase the total cost of manufacturing to account for Nippon Steel's purchases of iron ore from an affiliated supplier. The exporter said Commerce "failed to account for the relatively lower quality" of ore bought from Nippon Steel's affiliated suppliers when comparing the prices of ore bought from affiliated and unaffiliated suppliers. "Commerce’s decision to disregard NSC’s iron ore transactions with affiliates was inconsistent with 19 U.S.C. §l677b(f)(2) because the record indicates that the prices paid to NSC’s affiliates for lower-quality iron ore fairly reflect that the prices are lower than the market price on the record, which are for higher quality ores," the complaint said.