Commerce Complied With Surrogate Value Calculation on Remand in Mattress Case, DOJ, Petitioner Say

The Court of International Trade should sustain the Commerce Department's remand redetermination in an antidumping duty investigation on mattresses from Cambodia, upholding that the agency's use of a simple average in surrogate value cost calculations was legal and its use of financial statements from Emirates Sleep, DOJ said in Sept. 29 remand comments (Best Mattresses International v. U.S., CIT # 21-00281).

In its July 17 remand redetermination, Commerce more than doubled the weighted-average dumping margin for Best Mattresses and Rose Lion to 103.79%, from 45.34% (see 2307190035).

DOJ said that Commerce's redetermination complied with the remand order by further explaining why Cambodia continues to be the appropriate market to consider under the "transactions disregarded" rule, correctly excluding imports from non-market economy countries and countries with broadly available export subsidies, and reevaluating evidence regarding Emirates Sleep’s financial statements.

In its second set of comments, Best Mattresses agreed that Emirates Sleep's statements were incomplete and that the combination with GTI's statements was supported by evidence and lawful. However, the exporter still contests other aspects of the redetermination (see 2308310040).

In its remand order, the court held that Commerce should have explained why the selection of Cambodia was a "reasonable method" to confirm that the affiliated prices reflect arm’s length transactions (see 2302270076). Commerce explained its selection of the Cambodian Trademap data as accounting for the respondents’ purchasing experience of minor inputs and fixed assets in the Cambodian market and its prior practice, DOJ said. That neither party contested the “market under consideration” issue prior to remand.

Commerce also complied with the remand order by providing authority for its interpretation of the statute to support the exclusion of non-market economy data, DOJ said. The department explained that the statute assumes that prices for goods produced in non-market economies cannot be relied upon for purposes of a price-based analysis.

The remand order explained that Commerce normally excludes such data unless a party can rebut the presumption that prices are distorted, which didn't happen, DOJ said. "Because Best Mattresses did not purchase from unaffiliated suppliers, nor did the affiliated suppliers sell the items to unaffiliated customers, Commerce was without a market price against which to test the affiliated party’s purchases," DOJ said. The department correctly found that it couldn't rely on the affiliated supplier’s costs because the affiliate was based in a non-market economy, and Best Mattresses cited no authority that would support including imports from non-market economy countries and countries with broadly available export subsidies, DOJ said.

Commerce calculated the surrogate cost of production for the major input analysis based on the GTA data for Brazil, Malaysia, Mexico, Romania, Russia and Turkey and found that each country carried equal weight in the calculation and nothing on the record would have led the department to another determination, DOJ said.

Contrary to Best Mattressess' objections, Commerce didn't change its methodology on remand, DOJ said. Best Mattresses failed to provide evidence to support its weighted-average methodology nor did it explain why that would have been more accurate and representative than equally weighted inputs, DOJ said.