Commerce AFA Rate Bears No Reasonable Relation to Potential Dumping, Rebar Exporter Argues

A Mexican rebar exporter says its history of marginal dumping rates and cooperation with Commerce Department proceedings means that the 66.7% adverse facts available rate Commerce assigned it in an antidumping duty administrative review could not reasonably reflect any possible dumping, the exporter, Simec, argued in an April 26 motion for judgment at the Court of International Trade (Grupo Simec, et al. v. U.S., CIT # 22-00202).

During the review, Simec requested several "brief extensions" from Commerce, the company said. Commerce granted some of Simec’s extension requests, but ultimately denied a request to extend the deadline for supplemental questionnaire responses. Simec argued that the denials were unreasonable in light of the company's loss of three accountants on its antidumping response team due to COVID-19 and "numerous" more lengthy extensions in other cases.

Simec argued that had Commerce afforded it the time to complete its responses, it would have eliminated the very holes in the record that Commerce cited in its use of AFA and directly resulted in the margin being challenged. "Every alleged deficiency that Commerce claims to have identified" is from Simec’s supplemental questionnaire that it asked for additional time to complete, Simec said.

AFA makes sense to provide respondents with an incentive to cooperate, but not to impose "punitive" or "aberrational" margins to entities with a history of cooperation, Simec argued. Commerce had calculated rates of 0%, 3.65%, and 4.93% for Simec in prior reviews, in which the company was ruled to have been fully cooperative.

"There is no plausible argument that the 66.7% rate reflects a reasonably accurate dumping margin for Simec or is necessary to induce Simec’s future cooperation, given Simec’s excellent record of compliance and consistently low dumping margins over the course of many years of administrative reviews," the company said.

In its initial complaint, Simec said that it had difficulty in responding to the questionnaires during the review period due to COVID-19 restrictions, the deaths of three of its accountants, and the fact that the 15 entities "collapsed" into Grupo Simec did not have common accounting or management software (see 2208090060).

In their own motion for judgment, Grupo Acerero and Gerdau Corsa agreed with Simec regarding the usage of adverse facts and added that Commerce's use of a simple average to calculate the 33.35% all-others rate resulted in an "extraordinarily high" rate "completely out of line with rates historically calculated for cooperating respondents," and more than six times the highest rate ever assigned to a non-selected company in a prior review.

Commerce had previously rejected a suggestion to use the non-selected companies’ rate of 4.93% from the previous review or to apply an average of the non-selected companies’ rates from all prior reviews, saying that the non-selected respondents provided no evidence as to why their suggested rates would have been "more representative" than the simple average method