Chinese Exporters Attack Benchmark Calculations and AFA Use in Chinese Wood Flooring Case

The Commerce Department made multiple errors when it miscalculated benchmark data and its use of adverse inferences in a countervailing duty review on multilayered wood flooring from China, Chinese wood flooring exporters and consolidated plaintiffs Fine Furniture (Shanghai) and Double F said in an Sept. 29 reply brief at the Court of International Trade. The brief raised similar points to one filed by respondent Baroque Timber Industries two weeks earlier (see 2309180042) (Baroque Timber Industries (Zhongshan) Co. v. U.S., CIT Consol. # 22-00210).

UN Comtrade data that Commerce selected for its benchmark calculation for the provision of plywood at less than adequate remuneration (LTAR) was inappropriate because the data was overinclusive and didn't reasonably represent a benchmark for plywood, Fine Furniture said. Commerce averaged the Comtrade data with that of the International Tropical Timber Organization (ITTO) data for Brazil and Peru despite the ITTO data being more comparable to the plywood purchased by Baroque, Fine Furniture said.

In earlier briefs, DOJ acknowledged that the Comtrade dataset covered all grades of plywood and was not differentiated or filtered by grade, Fine Furniture said. Because the Comtrade data included "more costly, grade A plywood," its prices were skewed away from those paid by Baroque, which only bought C/D grade plywood, Fine Furniture said.

Similarly, Commerce’s use of the same data set to calculate the benchmark for veneer purchases was inappropriate despite the more representative ITTO data being on the record. The department "failed to follow its practice in selecting product-specific data on the record," Fine Furniture argued.

Finally, Fine Furniture argued that Commerce's use of AFA regarding use of the Export Buyer's Credit Program was unsupported because the Chinese government and Baroque fully cooperated in the underlying proceeding, leaving no gap in the record to support the use of AFA.

DOJ argued that the missing information was the list of banks that may have disbursed loans to U.S. customers and only the Chinese government could have provided such a list (see 2306230008). In response, Fine Furniture cited the recent decision in Yama Ribbons & Bows Co. v. U.S., in which the court found that Commerce impermissibly applied AFA to a cooperating respondent. In that case, the court found that Commerce couldn't cite its own reliance on missing information from the Chinese government to justify the usage of AFA (see 2308280034).