Commerce Upholds Findings in South Korean Steel Plate CVD Case After Second Remand

The Commerce Department made no changes to the final results of its countervailing duty administrative review on exporters of South Korean carbon and alloy steel cut-to-length plate, after a second remand in a case challenging the results of the 2018 review (Nucor Corporation v. U.S., CIT # 21-00182).

Nucor Corp., a domestic steel manufacturer, brought a complaint to the Court of International Trade in April 2021 alleging Commerce overlooked a government benefit received for less-than-adequate remuneration (LTAR) by POSCO, a South Korean exporter, and failed to account for the subsidies of POSCO affiliate Plantec, which it said was a cross-owned input supplier of scrap metal for the exporter. POSCO was the sole respondent in the Commerce Department’s 2018 review of South Korea’s steel plate exports.

Nucor claimed in its complaint that the South Korean government charged prices for electricity below market value for large industrial consumers, including POSCO, that shifted their electricity consumption to off-peak hours -- effectively subsidizing them. It alleged Commerce illegally failed to investigate the subsidy. It also said POSCO’s affiliate, Plantec, was a cross-owned input supplier with POSCO and their subsidies should be included in Commerce's calculation of POSCO’s CVD.

DOJ said Nucor’s allegation was not enough to force Commerce to begin an investigation (see 2203080072). And Plantec, it said, wasn't a cross-owned input supplier for POSCO because its scrap metal wasn't “primarily dedicated” for POSCO’s products (see 2304260018).

CIT Judge Mark Barnett has twice remanded the case to Commerce (see 2309050074). The second time, the court found Commerce failed to clearly articulate a standard of review and apply it to Nucor’s claim (see 2210130077).

Commerce upheld its earlier decisions in its most recent redetermination results.

As an initial matter, it said, it agreed there was overall a low threshold for initiation of a CVD investigation. However, a claim still must meet certain requirements “beyond merely describing a subsidy practice as counteravailable,” it said. In particular, it must provide all reasonably available facts important to its allegation, Commerce said. Commerce also may choose not to reinvestigate certain facts if it already has determined no countervailing subsidies exist, it said.

“In short, given Commerce’s prior examination of Korea’s electricity market in numerous proceedings, Nucor’s off-peak electricity allegation failed to provide a sufficient basis to reexamine Commerce’s findings that Korea’s electricity market was consistent with market principles,” Commerce said.

It said Nucor hadn't provided Commerce all easily accessible, relevant evidence for its allegation because it failed to mention Commerce had previously reached a decision about South Korean off-peak electricity pricing.

Nucor based its claim on a U.S. Court of Appeals for the Federal Circuit ruling that supported Commerce’s finding that the Korean electricity provision was not at LTAR, it said. It also cited part of an earlier analysis Commerce made available to the court about the system in the broader context of the Korean market. All of of the information about Commerce’s earlier investigation and its results were readily available, and Nucor also should have provided it with its allegation, Commerce said.

It also said some of the evidence Nucor did provide was inadequate or misleading.

As to Nucor’s claim about Plantec, Commerce said it changed its method of analysis after it received two supplemental questionnaires from POSCO. However, although it found that Plantec did receive a subsidy and the two companies were closely linked, it said that Plantec was owned by a group of its creditors at the time of Commerce's administrative review and thus wasn't controlled by POSCO.