38 I.T.R.D. (BNA) 1473
Ct. Intl. Trade2016Background
- Commerce investigated antidumping duties on drawn stainless steel sinks from China; Dongyuan and Superte/Zhaoshun were mandatory respondents; final margins assigned and an antidumping order issued.
- Plaintiffs Elkay (U.S. producer) and Dongyuan (Chinese exporter) challenged Commerce’s normal-value calculations: Elkay challenged SG&A labor treatment; Dongyuan challenged the surrogate value for cold-rolled stainless steel coil.
- Commerce initially used Thai GTA import data to value stainless-steel coil (surrogate value $3.80/kg) and used Thai surrogate financial statements with an SG&A/interest ratio that had been adjusted to avoid alleged double-counting of SG&A labor.
- The Court (Elkay I) granted a partial voluntary remand to allow Commerce to consider additional import data and directed reconsideration of the SG&A methodology; Commerce issued a Remand Redetermination.
- On remand Commerce retained the Thai surrogate value after comparing additional countries’ import AUVs, and revised its SG&A methodology by removing the prior downward adjustment (i.e., it included full reported SG&A labor in the financial ratios rather than shifting those labor costs into the labor FOP rate).
- The Court affirms Commerce’s Remand Redetermination, sustaining both the Thai surrogate value selection and the revised SG&A valuation and upholding Commerce’s decision not to reopen the record for alternative labor data.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Thai GTA import data were the best available surrogate for cold-rolled stainless-steel coil | Dongyuan: Thai data aberrational, dominated by dumped/subsidized imports and based on small quantities; Philippines/Indonesia data preferable | Commerce: Thai 11-digit subheadings are more specific to Dongyuan’s grade (304/austenitic); after excluding distorted imports Thai AUV falls within range of other countries and quantity is substantial | Court: Affirms Commerce — Thai data were the best available and not aberrational; choice supported by substantial evidence |
| Whether Commerce improperly excluded SG&A labor from SG&A ratio (double-counting adjustment) | Elkay: Commerce’s Final Determination improperly adjusted SG&A ratios and the record lacked evidence to quantify double-counting | Commerce (on remand): Prior exclusion was erroneous; NSO labor rate does not capture all SG&A labor; surrogate financial statements separately report SG&A labor, so include full SG&A in ratios | Court: Affirms remand change — inclusion of full SG&A/interest ratio is supported by record; prior adjustment lacked substantial evidence |
| Whether Commerce’s use of NSO labor data (instead of ILO Chapter 6A or 5B) created impermissible double-counting or required further adjustment | Dongyuan: NSO rate likely overstates wage base (includes non-production labor) so double-counting occurs unless SG&A labor is removed from ratios; Labor Methodologies notice requires removing identifiable SG&A labor when using broad labor data | Commerce: NSO data are more product-specific and contemporaneous than ILO; Labor Methodologies adjustments apply to ILO Chapter 6A use, not here; record does not show NSO overstates manufacturing labor sufficiently to justify adjustment | Court: Affirms Commerce’s approach — NSO was a reasonable choice; Labor Methodologies notice doesn’t compel the adjustment here; Commerce’s factual findings have substantial evidence support |
| Whether Commerce abused its discretion by declining to reopen the record to admit ILO Chapter 5B or other alternative labor data | Dongyuan: If double-counting cannot be resolved, Commerce must change labor source (e.g., use ILO 5B) and reopen record | Commerce: Parties had opportunity in investigation; ILO 5B not on the record; reopening is discretionary and unnecessary because NSO is best available on record | Court: Affirms Commerce’s discretion not to reopen; selection of NSO supported by substantial evidence |
Key Cases Cited
- Consol. Edison Co. v. NLRB, 305 U.S. 197 (administrative substantial-evidence standard)
- Essar Steel Ltd. v. United States, 678 F.3d 1268 (agency discretion to reopen the record)