Korean Exporter Brings Next Case Contesting CVDs on Old Debty-to-Equity Swaps

A South Korean exporter of certain corrosion-resistant steel products filed another complaint March 19 in the Court of International Trade saying that a 2014 to 2018 debt-to-equity restructuring led by the Korean government assisted its previous owners, not its current ones (KG Dongbu Steel Co., Ltd. v. U.S., CIT # 24-00056).

Korean exporter KG Dongbu Steel’s main charges span several years of reviews. Its most recent complaint addresses the final results of a 2021 countervailing duty review, but it filed another case last year, currently ongoing, against the 2020 review’s results (see 2304060044) and another case two years ago against the 2019 review’s results (see 2203170074).

Dongbu’s recent complaint is almost identical to the one filed last year. In this latest complaint, the exporter said that Commerce was wrong to assign it a 6.48% CVD rate in the 2021 review because three government-led debt-to-equity conversions it received between 2014 and 2019 only helped Dongbu’s previous owners stay afloat. The alleged countervailable subsidy, the conversions, didn't pass through to the new owners, it said.

The department also acted inconsistently because, in its 2017 and 2018 reviews, it didn't consider that subsidy countervailable, but changed its tune starting in its 2020 review, Dongbu said.

Court of International Trade Judge Jennifer Choe-Groves found in July 2023 that, in Dongbu’s case contesting Commerce’s 2019 review, Commerce had not adequately explained why it only started counting the conversions as countervailable in 2019 (see 2307100028). She remanded the case, but the department reached the same conclusion in its remand results (see 2310060006), which Choe-Groves has yet to review.

Dongbu’s case against Commerce’s 2020 review is still ongoing (see 2312080039).