NLMK's Bid to Have CIT Take Over Section 232 Exclusion Process 'Overreach,' US Argues

Steel company NLMK Pennsylvania has "no basis" to argue that the Court of International Trade should take over the Section 232 tariff exclusion process and simply award the importer hundreds of millions of dollars, the U.S. argued in a reply brief at the trade court. Looking to rebut NLMK's arguments seeking to discredit the Commerce Department's denials of NLMK's 58 Section 232 exclusion requests, the U.S. said that the relief that the steel company seeks is "clear overreach" (NLMK Pennsylvania v. United States, CIT #21-00507).

In its motion for judgment, NLMK had asked CIT to take over the remand process and order Commerce to grant the exclusions. The plaintiff said the agency has repeatedly ignored the record evidence which showed that the U.S. industry did not have the capacity to fill the importer's requests (see 2207250032).

In its reply, the U.S. said the audacity of this request "cannot be overstated" and that it represents blatant overreach for which no legal support can be found. "NLMK bases its exclusion requests almost entirely on manufactured grounds for a quality-based exclusion," the brief said. "And in instances where it claims that those items cannot be produced in sufficient quantities, the records contain clear evidence supporting a contrary finding. … Thus, even assuming NLMK is successful in showing that Commerce could have made a more 'rational connection' between the 'facts found' and 'choices made,' ... the records in this case demonstrate that NLMK’s case is nowhere near as clear-cut as NLMK purports."

Elsewhere in the brief, the U.S. supported its exclusion request denials by detailing why substantial evidence backed the decisions for each of five groupings of exclusion requests. For instance, for 26 requests made in 2020 for 250 mm thick semi-finished steel slab, the U.S. said the record established that a proper substitute for the product was available in widely available enough numbers to support rejecting the exclusion. When considering this group, the U.S. also made its decision in three tranches. NLMK took issue with the tranched nature of the decision, arguing also against the varying verbiage the U.S. used to deny the requests.

"It is unclear why NLMK believes that is a valid basis for an argument," the brief said. "That Commerce used different language to establish the same overarching point does not prove that the point itself is irrational. It merely shows that despite what language Commerce used, its decisions were substantially consistent, as demonstrated by the fact that it made the same central point in every one of these decisions."