Federal Circuit - Approach in calculating separate rate under antidumping investigation 

December 17: The U.S. Court of Appeals for the Federal Circuit today issued its decision concerning an antidumping investigation of imports of 1-hydroxyethylidene-1,1-diphosphonic acid (HEDP) from China, and whether the U.S. Commerce Department acted arbitrarily in recalculating, on remand, the separate rate of individual dumping duty margin assigned to the appellant. Changzhou Wujin Fine Chemical Factory Co., Ltd. v. United Sates, 2011-1080 (Fed. Cir. December 17, 2012)

The Federal Circuit affirmed in part, and reversed and once again remanded the matter to Commerce to reconsider its approach in calculating the appellant’s separate rate as part of the antidumping duty determination.


Read the decision: Changzhou Wujin Fine Chemical Factory Co. [PDF 147 KB]

Overview

This case presented the following issues: (1) whether the U.S. Court of International Trade had jurisdiction to review Commerce’s post-remand modification of U.S. price; and (2) whether Commerce acted arbitrarily when recalculating the separate rate assigned to the appellant.


Concerning whether Commerce’s recalculation of U.S. price was within the scope of the Court of International Trade’s remand order, the Federal Circuit affirmed.


Concerning the second question, the Federal Circuit found that Commerce was not reasonable in recalculating the appellant’s (a “cooperating party”) separate rate, as Commerce constructed a hypothetical “adverse facts available” (AFA) rate based on U.S. price data obtained from a non-cooperating respondent, averaged that hypothetical AFA rate with the de minimis rate for another respondent, and then assigned the resulting separate rate to the appellant.


The Federal Circuit stated that:


Commerce acted in an arbitrary and capricious manner…[when,] by its own account—it cherry-picked the single data point that would have the most adverse effect possible on cooperating voluntary respondents, in a situation where there was no need or justification for deterrence.

The Federal Circuit remanded the issue to Commerce to once again reconsider its approach to calculating the appellant’s separate rate. In doing so, the Federal Circuit directed Commerce to act non-arbitrarily and explain why its approach is a “reasonable method” of calculating a separate rate, in light of the alternatives available, and with recognition of the fact that the remand calculation will affect only cooperating respondents.



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