Antidumping/Countervailing Duties

The U.S. Department of Commerce self-initiated antidumping and countervailing investigations of common alloy aluminum sheet from China on November 28.  An accompanying fact sheet estimates dumping margins on the subject merchandise to be between 56.54 and 59.72 percent, and estimates a subsidy rate above de minimis.  Trade cases are typically initiated in response to petitions filed by a domestic industry alleging that dumped or unfairly subsidized goods are being exported to the U.S. market.  Self-initiation authority, however, can be exercised whenever the Secretary determines that a formal trade remedy investigation is warranted based on available information.

The Department’s use of self-initiation authority has been judicious and rare.  In an agency-issued press release Secretary Wilbur Ross stated, “{w}e are self-initiating the first trade case in over a quarter century, showing once again that we stand in constant vigilance in support of free, fair, and reciprocal trade.”  The Department further noted that it last self-initiated a countervailing duty investigation in 1991 on softwood lumber from Canada, and last self-initiated an antidumping duty investigation in 1985 on semiconductors from Japan. 
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On October 26, 2017, the Department of Commerce  announced the results of an investigation concluding that China is a non-market economy (“NME”) country for purposes of Commerce’s antidumping analysis.  Commerce’s decision continues the long-standing practice of the agency with respect to the antidumping methodology it applies to cases involving China.

Commerce was spurred to review its position on China’s NME status, last addressed in 2006, following the December 11, 2016 change in China’s Protocol of Accession to the World Trade Organization (“WTO”).  By way of background, the WTO Antidumping Agreement permits WTO member countries to impose duties on dumped imports.  Those duties are calculated as either the difference between the imported product’s export price and the comparable home market price, or the difference between the export price and a constructed value based on the product’s cost of production.  Sometimes, however, those home market prices or costs of production do not reflect market forces, particularly in NME countries.
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On Friday, October 27, 2017, the Department of Commerce announced its affirmative preliminary determination in the antidumping duty investigation on aluminum foil from China.  The Department calculated preliminary dumping margins of 96.81 and 162.24 percent for the two mandatory respondents under investigation.  Additionally, the Department set the rate for the PRC-wide entity at 162.24 percent and the rate all other companies found to be separate from the PRC-wide entity at 138.16 percent.
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On October 18, 2017, the U.S. Department of Commerce published its preliminary determination that two Indian bar producers, Viraj Profiles Ltd. (“Viraj”) and the Venus Group (Venus Wire Industries Pvt. Ltd. and its affiliates Hindustan Inox Ltd., Precision Metals and Sieve Manufacturers (India) Pvt. Ltd.), have resumed dumping stainless steel bar into the U.S. market and that both companies should be reinstated back under the existing antidumping duty order on stainless steel bar from India. 
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On September 19th, the Department of Commerce announced that they will impose preliminary countervailing duties (“CVD”) on Chinese and Indian exports of cold-drawn mechanical tubing of carbon and alloy steel.  See the fact sheet here.

Commerce determined that China and India received countervailable subsidies benefiting the production of mechanical steel tubing from their respective governments.  Previously, on June 2nd, the U.S. International Trade Commission (“ITC”) had unanimously determined that there is a reasonable indication that a U.S. industry is materially injured by reason of unfairly traded imports of cold-drawn mechanical tubing from China, Germany, India, Italy, Korea, and Switzerland that are allegedly sold in the United States at less than fair value and subsidized by the governments of China and India.
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On September 28, President Donald Trump announced his nomination of two Commissioners to the United States International Trade Commission.  Dennis M. Devaney of Michigan for the remainder of a nine-year term, expiring June 16, 2023 and Randolph J. Stayin of Virginia for the remainder of a nine-year term expiring June 16, 2026.

Mr. Devaney and Mr. Stayin were nominated to fill the Commissioner positions of Commissioners Kieff and Pinkert, who left the ITC earlier this year.  President Trump’s two nominations were made with the ITC operating with only four out of six Commissioners and experiencing a historically high Section 337 caseload.
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On September 11, 2017, the U.S. Court of Appeals for the Federal Circuit (“Federal Circuit”) issued a judgment without opinion affirming the International Trade Commission’s (“ITC”) decision in Viraj Profiles Limited v. ITC (2016-2482) that resulted in a limited exclusion order against Indian stainless steel producer Viraj Profiles Limited (“Viraj”).  The exclusion order prohibits the importation into the United States of all stainless steel products manufactured by or on behalf of Viraj.  The order has been in effect since July 2016 and will remain in place for a period of 16.7 years.
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On September 12th, the Commerce Department announced preliminary subsidy rates in its countervailing duty (“CVD”) investigation of certain tool chests and cabinets from China.  The rates calculated for the two examined Chinese producers and most other Chinese producers/exporters range from 17.32 to 32.07 percent.  See the Fact Sheet here.

In addition, thirty-one Chinese companies that failed to respond to Commerce’s initial inquiries received a “total” adverse rate of 112.99 percent.   The scope of this investigation, which Commerce modified based on petitioner’s recommendations, covers certain metal tool chests and tool cabinets, with drawers, (tool chests and cabinets), from China.  As a result of Commerce’s preliminary determination, imports of covered tool chests and cabinets from China that enter the United States will be subject to cash deposits consistent with the preliminary subsidy rates. 
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Yesterday, the Department of Commerce announced its preliminary determinations in the countervailing duty investigations on carbon and alloy steel wire rod from Turkey and Italy.  Commerce reached affirmative determinations in both cases, finding that wire rod producers in those countries benefitted from government subsidies.  Specifically, Commerce found an overall subsidy rate of 1.70 percent ad valorem for Italian producer Ferriere Nord S.p.A. and 44.18 percent ad valorem for Italian producer Ferriera Valsider S.p.A.  Imports of wire rod from Italy by all other producers and exporters will require a cash deposit at a rate of 1.70 percent ad valorem.
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On August 10th, the U.S. International Trade Commission (“ITC”) unanimously determined that there is a reasonable indication that a U.S. industry is materially injured by reason of unfairly traded imports of low melt polyester staple fiber (“PSF”) from Korea and Taiwan.  Low melt PSF is a synthetic (manmade) staple fiber, not carded, combed or otherwise processed for spinning, made entirely of polyester.  It can be used in nonwoven products for a broad spectrum of downstream industries, including automotive (door trim, dash pads, wheel guards, carpets, trunk and hood liners), industrial purposes (soundproofing and insulation for construction, water and air filtration), and hygienic products (wipes, diapers, sanitary and medical goods, etc.). 
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