Nippon Steel Argues Against Deduction of Section 232 Duties From US Price in AD Review

July 25, 2022 by Jacob Kopnick|Litigation

The Commerce Department improperly deducted Section 232 steel and aluminum duties from antidumping duty respondent Nippon Steel Corp.'s (NSC's) U.S. price, the exporter argued in a July 22 complaint at the Court of International Trade. Becoming the next company to make the claim, NSC argued that Section 232 duties are unlike the ordinary customs duties that are considered U.S. import duties and are in fact "far more similar" to antidumping duties, countervailing duties and safeguard duties, which are not deducted from U.S. price (Nippon Steel Corporation v. United States, CIT #22-00183).

The case contests the 2019-2020 administrative review of the antidumping duty order on hot-rolled steel from Japan in which NSC served as the sole mandatory respondent. During the review period, NSC paid Section 232 duties on all of its exports. Commerce deducted the Section 232 duties paid from NSC's U.S. steel price, finding, as it has in many other AD cases, that the duties are ordinary customs duties and thus should be taken from the U.S. price. The result of the review was a 24.07% dumping rate for NSC.

The trade court has previously upheld this determination from Commerce in other antidumping cases, though the Federal Circuit has not weighed in yet, prompting continued challenges, such as the present action. In its complaint, NSC argued that specifically, the Section 232 duties are more similar to AD/CVD and safeguard duties since "(1) the Section 232 duties here serve a special remedial purpose similar to AD, CV, and SG duties; (2) the Section 232 duties here are temporary in nature; and (3) deducting these Section 232 duties from NSC’s U.S. prices imposes an impermissible double remedy."

The respondent further argued that considering the Section 232 duties to be ordinary customs duties would lead to the U.S. violating its World Trade Organization obligations since the U.S. would be imposing duties on steel imports over its bound tariff rates.