Commerce's Regulations From WTO Deals 'Major Question' to US and Not Delegated by Congress, Appellant Says

The question of whether the Commerce Department has the statutory authority to conduct expedited reviews in countervailing duty investigations constitutes a "major question" that requires explicit delegation from Congress as established in the Supreme Court's West Virginia v. EPA decision, the Committee Overseeing Action for Lumber International Trade Investigations or Negotiations said in a supplemental brief at the U.S. Court of Appeals for the Federal Circuit on Feb. 22 (Committee Overseeing Action for Lumber International Trade Investigations or Negotiations v. U.S., Fed. Cir. # 22-1021).

The domestic petitioner group said that if the court upholds the "theory" that Commerce can directly interpret World Trade Organization deals and issue implementing regulations without specific authorizations, "Congress would no longer control the parameters of the United States’ obligations under the WTO Agreements."

The case concerns a January 2018 CVD order on softwood lumber from Canada, in which Commerce carried out an expedited CVD review for various Canadian lumber companies. The Court of International Trade subsequently ruled that Commerce did not have the authority to conduct the review (see 2302080039), ruling that Section 103(a) of the Urguay Round Agreements Act did not authorize the regulation establishing the expedited reviews.

The Canadian lumber companies, along with the Canadian federal government and the governments of Quebec and New Brunswick, appealed the decision, arguing that Section 103(a) provides the legal basis for the reviews since it provides for officers of the U.S. government to issue regulations needed to ensure that any part of the URAA is properly implemented. Since the U.S. signed the WTO Agreement on Subsidies and Countervailing Measures, a part of the URAA which requires signatories to provide an expedited review process for non-individually examined CVD respondents, Section 103(a) permits the U.S. to establish the reviews, the appellants said.

The petitioner group filed a supplemental brief in response to an amicus brief from the U.S. In it, the appellee invoked the Supreme court's West Virginia decision, in which the court held that Congress has the sole right to make decisions on "major questions" regarding the economy except where there is an explicit delegation to a federal agency. The committee argued that a major question is at play and Commerce did not explicitly delegate the decision to Commerce.

According to the petitioner group, the appellants say that Commerce can directly interpret WTO agreements and issue regulations without specific authorization based on Section 103(a) of the URAA and the Statement of Administrative Action. But under that theory, federal agencies would be allowed to "promulgate binding regulations implementing unilateral interpretations of any provision of the WTO Agreements that would otherwise have no enforceability under domestic law" instead of Congress having a say on the issue, the brief said.

The committee said that this cuts against the statute, SAA and legislative history of the URAA, while also departing from the agency's long-held position given that Commerce has not said it has the authority to directly implement WTO agreements via regulations. "Because this issue concerns a 'major question,' the Court should find, as the Supreme Court in West Virginia did, that a delegation of authority of such magnitude and consequence requires a 'clear congressional authorization,'” the brief said. “That clarity is lacking here. Even if the SAA provides some indication of congressional intent in support of Commerce’s authority, it is far from the sort of '“clear authorization' required under West Virginia.”