Government Misunderstood Remand Order, 'Double-Counting' Issue, Importer Claims

The Commerce Department “misunderstood” a court order to explain why an industry support calculation didn’t involve double-counting, an importer said July 26 in a reply to the government (Tenaris Bay City v. U.S., CIT # 22-00343).

Oil country tubular goods importer Tenaris Bay, which opposed initiation of an antidumping duty investigation by arguing that the department’s calculation of industry support for it had overcounted the industry’s entities, said Commerce’s reply (see 2406270061) “again either misunderstands the double-counting issue or refuses to address it.”

“The potential 'double-counting' distortion that was remanded by the Court is not in the relationship between the numerator and denominator of the industry support ratio,” it said. “Rather, the distortion is within each of the numerator and denominator” in circumstances where the production of the green pipe and the heat treatment of that domestically-produced green pipe “are each counted as U.S. production.”

In other words, if one ton of pipe was first manufactured by one company, then heat-treated by a different one, but each were counted separately as U.S. production, “the result is ‘double-counting of the same pipe,’” it said.

Commerce claimed any of these errors would be canceled out when dividing the numerator by the denominator, but that would work “only if the ratio were 1:1,” it said.

“For example, removing one ton of OCTG from both the numerator and denominator of a ‘9/10’ ratio transforms the ratio to ‘8/9,’ and a different percentage (i.e., 90% to 88.8%),” it said.

It also argued that the data Commerce relied on commingled actual U.S. producers of OCTG goods and entities that only conduct “minor processing,” such as OCTG threading. Commerce didn’t clarify in its post-remand determination that process or that its data had been broken out this way -- because it couldn’t be, Tenaris said. It said it asked Commerce to poll OCTG producers and processors to get actual production data during the administrative proceeding.

The ITC doesn’t consider independent threaders to be part of the domestic OCTG production industry, it said.

On the other hand, the department also failed to confirm that the denominator of the industry support calculation included all shipments of manufactured OTCG to processing companies for heat treatment, it claimed. The department relied on 2020 shipment data provided by the petitioners, it said, but that data might not be accurate, it said, as part of a highly redacted portion of the brief.