EAPA Investigation Finds Duty Evasion by Soil Pipe and Fittings Imports

CBP has determined that LDL Trading Company evaded the antidumping and countervailing duty orders on cast iron soil pipe and cast iron soil pipe fittings from China, it announced in an Oct. 30 notice. CBP said that substantial evidence showed that LDL imported Chinese-origin soil pipe and fittings transshipped through Malaysia and misclassified covered merchandise as goods not subject to the AD/CVD orders.

CBP found that LDL's failure to provide requested information combined with non-responses from both its "claimed manufacturer," Vanguard, and the unnamed Malaysian supplier were enough to use adverse inferences, but noted that "the record contains ample evidence to determine there is substantial evidence of evasion without the application of an adverse inference to LDL."

Vanguard Metal Fabrication shipped over 1,000 tons of soil pipe and fittings from Malaysia to LDL between October 2021 and August 2022. Those shipments consisted of “Cast Iron Pipe” and “Cast Iron Pipe Fittings” classified under Harmonized Tariff Schedule subheadings 7303.00 and 7307.11, respectively. Both subheadings are included in the scope of the respective AD/CVD orders, CBP said. Those shipments also consisted of “Cast Iron Pipe” classified under HTS 7307.19, which is not included in the scope of the AD/CVD orders on cast iron soil pipe from China. CBP said that "suggested misclassification."

After interim measures were announced in January (see 2302060041), CBP issued information requests to LDL, Vanguard, and another unnamed supplier. LDL didn't provide the requested information regarding its accounting and financial practices, including financial documents and banking information related to the purchase and sales of the merchandise at issue. LDL said that it was a small company without developed accounting but provided videos that it said it required of potential partners showing their production processes. CBP said that videos provided did "not appear to show the entire production process" for soil pipe.

In rebuttal, the Cast Iron Soil Pipe Institute provided information showing that two of the addresses associated with LDL were residential homes without any facilities to receive and store shipments of pipe and fittings. CISPI noted that documents submitted by LDL showed that its place of business was the same as the location of a Copperfit operation. CISPI said that information contradicted LDL’s claims that it is an independent company without affiliates and not under common control with any other entity. In its initial allegation, CISPI had alleged that LDL appeared to function as a “corporate mask" for Copperfit Industries.

CBP said it will suspend liquidation of all entries imported by LDL subject to this investigation and continue suspension of liquidation until instructed to liquidate. For entries previously extended by the interim measures, CBP will rate-adjust and change those entries to type 03 and continue suspension until instructed to liquidate. CBP said it also will evaluate LDL’s continuous bond and may require single transaction bonds as appropriate.