Commerce Misconstrued 'Time of Entry' Language When Assigning AD Review Rates, Exporter Argues

Commerce misconstrued its own regulations when it ordered CBP to liquidate entries of Goodluck India's cold drawn mechanical tubing from India at a 33.7% adverse facts available antidumping duty rate derived from a subsequent court decision, rather than the zero percent rate that was actually in effect at the time of entry, the company said in a May 15 brief at the Court of International Trade (Goodluck India v. U.S., CIT # 22-00024).

Goodluck's entries should have been subject to the rate in effect at the time between June 2020 and May 2021, which was the zero percent rate put in place by CIT before the Federal Circuit in August 2021 reversed the lower court decision and reinstated the 33.7% rate calculated in the original investigation, the brief said. Commerce took the plain regulatory language "at the time of entry" to mean the cash rate "that would have prevailed in the absence of the now-vacated CIT decision,” Goodluck said.

DOJ had argued that because the Federal Circuit determined that the zero percent rate was incorrect, applying that rate to Goodluck would have meant disregarding CAFC's decision. However, the Federal Circuit ruling was not applicable when the merchandise was entered, Goodluck argued.

While the 33.7% rate had been set in the original AD investigation, Goodluck had challenged the rate at CIT and won, resulting a zero percent margin and Commerce revoking the AD order for the company. The case was appealed to the U.S. Court of Appeals for the Federal Circuit, which reversed the decision to revoke the AD order for Goodluck, reinstating the 33.7% cash deposit rate. While the CAFC case was ongoing, Commerce conducted the second and third administrative reviews of the order. When Goodluck India didn't request to be reviewed in the third review, Commerce instructed CBP to liquidate Goodluck's entries subject to the third administrative review at the 33.7% rate.

The government argued Goodluck should have requested a review of its entries to avoid liquidation at 33.7% and said the company forfeited all rights to contest liquidation at that rate. Goodluck argued it had no reason to request a review of its entries, "given Commerce’s confirmation that such entries were not at that time subject to ADD and thus not reviewable." The company's review request for the second review in June 2020 does not support an obligation to have done so for the third review, Goodluck said.

This is not a case in which an importer declined to participate in litigation. The company has, and continues to vigorously protect its rights, Goodluck said. When Commerce resumed its respondent-specific conduct of the first and second reviews, it preliminarily calculated AD rates of 1.59% and 1.39% for Goodluck. Those low rates "underscore the impropriety of Commerce instructing CBP to liquidate Goodluck’s AR3 entries at 33.7%," the company said.