Steel Nail Exporter Tells CAFC Commerce 'Crossed the Line of Reasonableness' in Applying AFA

The judicial and administrative decisions cited by U.S. and antidumping petitioner Mid Continent Steel & Wire to defend the Commerce Department's use of adverse facts available against exporter Unicatch Industrial Co. do not apply to Unicatch's court challenge, Unicatch said in a reply brief at the U.S. Court of Appeals for the Federal Circuit. Commerce relied on AFA against Unicatch for failing to submit a complete cost reconciliation in the form requested by the agency, hitting the exporter with a 78.17% dumping rate (Pro-Team Coil Nail Enterprise v. United States, Fed. Cir. # 22-2241).

One such administrative decision used by the government and Mid Continent was a proceeding on lined paper products from India in which Commerce issued a third section D questionnaire with a cost reconciliation worksheet outline in which the agency requested missing figures in the cost reconciliation outline schedule. Part of this outline included an explanation and supporting documentation for each reconciled item.

Unicatch said that, in contrast, in the first administrative review of the AD order on steel nails from Taiwan, the agency never gave Unicatch a "cost reconciliation worksheet outline," and did not ask any additional questions about the company's cost reconciliation, "let alone advise Unicatch that its prior submissions were not acceptable." Had the agency provided such support, Unicatch, a cooperative respondent, would have satisfied the agency's requests.

Unicatch claimed that Commerce "crossed the line of reasonableness and fairness which is the cornerstone of its authority." The company said the agency treated it in the same way it treats "the most egregious offenders" and has acted in this manner when Commerce itself "failed to provide the same express instructions as it has in other cases." Commerce failed to acknowledge that "more is needed from Commerce before it rejects all of a respondent’s comprehensive, timely filed and accurate submissions," the brief said.

The decisions relied on by the U.S. and Mid Continent in their briefs do nothing to show that AFA was properly used, but rather show that Commerce "crossed the line of reasonableness," Unicatch added. In the review, the company did not "(1) refuse to respond to Commerce’s questionnaires; (2) submit false information; (3) submit information which was not supported by its accounting records maintained in the ordinary course of business; or (4) submit documents or worksheets which were internally inconsistent or misleading," the brief said.

The agency never expressly told Unicatch that to avoid total AFA it needed to submit one summary table which began with data on the company's audited financial statement and ended with cost of manufacturing data in the section D response, Unicatch claimed. "The record in this case reveals that Unicatch’s responses to Commerce’s cost reconciliation questions were timely, accurate and comprehensive," the company argued. "The record also reveals that Commerce never expressly directed Unicatch to submit a reconciliation Table, and that Commerce appeared to be satisfied with Unicatch’s response."