Guizhou Tyre Co., Ltd. v. United StatesGuizhou Tyre Co., Ltd. v. United States
OPINION AND ORDER
[Sustaining in part and remanding in part the determinations of the Department of Commerce.]
Dated: May 15, 2019
John Tudor, Senior Trial Counsel, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, D.C., for defendant. With him on the brief were Joseph H. Hunt, Assistant Attorney General, Jeanne E. Davidson, Director, and Franklin E. White, Jr., Assistant Director. Of counsel on the brief was Orga Cadet, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, D.C.
Mark B. Lehnardt, Baker Hostetler, LLP, of Washington, D.C., for consolidated plaintiff Tianjin United Tire and Rubber International Co., Ltd.
R. Kevin Williams, Mark R. Ludwikowski, Lara A. Austrins, Clark Hill PLC, of Chicago, IL, for consolidated plaintiff Weihai Zhongwei Rubber Co., Ltd.
Goldberg, Senior Judge: This action arises from a challenge by plaintiffs Guizhou Tyre Co., Ltd. and Guizhou Tyre Import and Export Co., Ltd., (collectively “Guizhou“) as well as consolidated plaintiffs Tianjin United Tire & Rubber International Co., Ltd. (“TUTRIC“) and Weihai Zhongwei Rubber Co., Ltd. (“Zhongwei“) (collectively “Plaintiffs“) to certain aspects of the final results published by the Department of Commerce (“the Department” or “Commerce“) of the 2015 Administrative Review of the countervailing duty order on off-the-road tires (“OTR tires“) from the People‘s Republic of China (“PRC“). Certain New Pneumatic Off-the-Road Tires from the People‘s Republic of China, 83 Fed. Reg. 16,055 (Dep‘t Commerce Apr. 13, 2018) (final results) (“Final Results“) and accompanying Issues & Decision Mem. (“I&D Mem.“), amended by Certain New Pneumatic Off-the-Road Tires from the People‘s Republic of China, 83 Fed. Reg. 32,078 (Dep‘t Commerce Jul. 11, 2018) (am. final results) (“Amended Final Results“). Guizhou filed a motion for judgment on the agency record, Pls‘. Mot. for J. on Agency R., ECF No. 25 (Sept. 21, 2018) (“Pls.’ Br.“), challenging Commerce‘s Amended Final Results with respect to: (1) Commerce‘s benchmark calculations to determine the extent of subsidies received by Guizhou; (2) Commerce‘s application of adverse facts available in finding use and benefit from the Export Buyer‘s Credit Program; and (3) Commerce‘s decision to countervail the Processing Trade Program. TUTRIC and Zhongwei have adopted and incorporated the challenges brought by Guizhou. TUTRIC Mot. for J. on Agency R., ECF No. 28 (Oct. 12, 2018); Zhongwei Mot. for
For the reasons discussed below, the court remands the Department‘s findings with respect to the adverse inference applied to the Export Buyer‘s Credit Program, sustains and remands in part the Department‘s benchmark calculations, and sustains the Department‘s decision to countervail the Processing Trade Program.
BACKGROUND
In November 2016, Commerce initiated a review of the countervailing duty order on certain OTR tires from the PRC based upon timely requests from interested parties during the period of review between January 1, 2015 and December 31, 2015. Antidumping and Countervailing Duty Administrative Reviews, 81 Fed. Reg. 78,778 (Dep‘t Commerce Nov. 9, 2016) (initiation). Mandatory respondent Guizhou, as well as the Government of China (“GOC“), responded to the Department‘s initial and supplemental questionnaires. GOC Initial Questionnaire Resp., ECF No 38, J.A. Tab 11 (May 4, 2017) (“GOC Initial Questionnaire Resp.“); Guizhou Initial Questionnaire Resp., J.A. Tab 10 (May 4, 2017) (“Guizhou Initial Questionnaire Resp.“); GOC First Supp. Resp., J.A. Tab 12 (June 26, 2017) (“GOC First Supp. Resp.“). Commerce also conducted a verification of Guizhou‘s questionnaire responses in December 2017. Verification of the Questionnaire Resps. of Guizhou, J.A. Tab 13 (Feb. 1, 2018) (“Verification Report“).
In October 2017, Commerce issued its preliminary results from the administrative review based on the parties’ questionnaire responses. Certain New Pneumatic Off-the-Road Tires From the People‘s Republic of China, 82 Fed. Reg. 46,754 (Dep‘t Commerce Oct. 6, 2017) (prelim. results) (“Preliminary Results“) and accompanying Prelim. Decision Mem., J.A. Tab 1 (Oct. 2, 2017) (“PDM“). In its preliminary findings, the Department determined that: (1) the Export Buyer‘s Credit Program was countervailable based on an adverse inference that Guizhou used and benefited from the program, PDM at 14-17; (2) the Processing Trade Program was countervailable because the GOC failed to demonstrate that it had a system or procedure in place to determine the quantity of natural rubber, synthetic rubber, carbon black, and nylon cord Guizhou consumed in the production of OTR tires, id. at 35-36; (3) there was “no basis to find the domestic synthetic rubber market to be distorted,” id. at 25; and (4) benchmarks for synthetic rubber, natural rubber, carbon black, and nylon cord inputs appropriately included actual ocean freight and import duty costs, id. at 33-35. As to the Export Buyer‘s Program, Commerce applied adverse facts available (“AFA“) to countervail the program because the GOC allegedly refused to answer Commerce‘s questions regarding the operation of the program. Id. at 14-17.
The Department‘s final decision largely echoed its preliminary findings. Commerce continued to find that the market for synthetic rubber was not distorted during the period of review. I&D Mem. at 10-12. Commerce also employed both Tier 1 and Tier 2 benchmarks in relation to certain less-than-adequate remuneration (“LTAR“) findings for synthetic and natural rubber (Tier 1), carbon black (Tier 2), and nylon cord (Tier 2). Id. at 12-13. These benchmarks included ocean freight and import duties. Additionally, Commerce applied an adverse inference to find that Guizhou used and benefited from the Export Buyer‘s Credit Program and concluded that “the record does not support finding non-use of the [Program].” Id. at 14. Finally, Commerce concluded that Guizhou received a countervailable subsidy from
Guizhou‘s motion for judgment challenges each of Commerce‘s findings above. See generally Pls.’ Br. For the reasons discussed below, the court sustains in part and remands in part Commerce‘s Amended Final Results.
JURISDICTION AND STANDARD OF REVIEW
The court exercises jurisdiction to hear this appeal under
DISCUSSION
Plaintiffs raise challenges to the Department‘s determinations regarding: (1) the PRC‘s Export Buyer‘s Credit Program (the “Export Program“); (2) the Department‘s calculation of benchmarks measuring adequate remuneration for synthetic rubber, carbon black, and nylon cord; and (3) the PRC‘s Processing Trade Program as a countervailable subsidy. The court sustains Commerce‘s decision to countervail the Processing Trade Program. For the remaining issues raised by Plaintiffs, the court sustains and remands in part, pursuant to the below.
I. China Export Import Bank Buyer‘s Credit Program
As in the 2014 Administrative Review,1 it is the Department‘s failure to
In its review, Commerce examined whether Plaintiffs potentially benefited from the PRC‘s Export Program, which provides loans to foreign companies to promote the export of Chinese goods. See Antidumping and Countervailing Duty Administrative Reviews, 81 Fed. Reg. 78,778 (Dep‘t Commerce Nov. 9, 2016) (initiation). Commerce issued several questionnaires to the respondents seeking information regarding the Export Program, and both Guizhou and the GOC responded that none of Guizhou‘s customers used the Program. Guizhou Initial Questionnaire Resp. at 54-55; GOC Initial Questionnaire Resp. at 139-140. Guizhou also submitted affidavits from its United States customers confirming non-use as exhibits to the initial questionnaire responses. See Guizhou Initial Questionnaire Resp. at 54, ex. I38; see also id. at 55, ex. 139. In a subsequent questionnaire response concerning the operation of the Export Program, the GOC responded that the “question [was] not applicable” because “none of the U.S. customers of the respondents used the Expert Buyer‘s Credit from [Export-Import] Bank during the [period of review].” GOC First Supp. Resp. at 10-11. Nonetheless, Commerce determined in its preliminary results that the GOC both withheld requested information and significantly impeded the proceeding such that the Department applied an AFA rate for each respondent based on Plaintiffs’ alleged benefit from the Export Program. PDM at 15-16 (citing, inter alia,
Commerce may select from facts otherwise available when necessary information is not available in the record or when a party to a proceeding: (A) withholds information that is requested; (B) fails to provide such information in the form and manner requested; (C) significantly impedes a proceeding; or (D) provides information which cannot be verified.
Here, upon requests from Commerce, Guizhou indicated it did not benefit from
Specifically, Commerce did not explain what additional information was necessary to assess the GOC‘s claim of non-use, and why other information available in the record (and provided by the parties) was insufficient to fill whatever gap was left by the GOC‘s non-compliance. Changzhou Trina Solar Energy Co. v. United States, 42 CIT __, 352 F. Supp. 3d 1316, 1327 (2018). In any review, the Department must consider record evidence that “fairly detracts” from its ultimate determination. See CS Wind Viet. Co. v. United States, 832 F.3d 1367, 1373 (Fed. Cir. 2016). Instead, Commerce concluded that “the record does not support finding non-use of the [Program] by Guizhou Tyre.” I&D Mem. at 14. In so doing, however, the Department blatantly ignored the eighty-five U.S. customer declarations that were submitted as exhibits to Guizhou‘s questionnaire responses, each of which stated that the customers “did not finance [their] purchases through either the use of the . . . export buyer‘s credit program or any other Chinese banks’ export buyer‘s credit program.” See Guizhou Initial Questionnaire Resp. at 55, ex. 139. The Department contends that the “GOC has not provided the requested information and documentation necessary for Commerce to develop a complete understanding of this program” and therefore, “absent [this] information, the GOC‘s claims that the respondent companies did not use this program are not verifiable.” I&D Mem. at 14. But more than just uncorroborated claims, Guizhou stated that it, first, “confirmed non-usage” by “contact[ing] all of its export customers and confirm[ing] that none of them applied for, used, or benefited from this program during the POR,” and second, by “contact[ing] all of its unaffiliated export customers in the United States in 2015 and inquir[ing] whether the companies used the export buyer‘s credit program or otherwise received credit facilities from EXIM.” See Guizhou Initial Questionnaire Resp. at 55. The corresponding U.S. declarations then affirmed those claims made by Guizhou. The Department‘s contention that non-use is unverifiable is simply not supported by the administrative record—which, as it stands, “fairly detracts” from Commerce‘s unsubstantiated finding of countervailability and benefits conferred, CS Wind Viet. Co., 832 F.3d at 1373. Indeed, not only has the Department failed
Commerce attempts to (unsuccessfully) fall back on its claim that in order to “verify the accuracy of the respondents’ claimed non-use of the program,” Commerce needs “supporting information and documentation” from “EX-IM Bank, as the lender” to “fully understand the operation of the program.” I&D Mem. at 14. There are two glaring problems with this finding. First, Commerce did not explain why the information that was provided—Guizhou‘s and the GOC‘s responses and accompanying declarations—was unverifiable on its own. The Department had the tools at its disposal to substantiate the accuracy of the declarations—and it had to try to do so before claiming that the record evidence is unverifiable. Second, it is unclear how or why the information about the program‘s operations are even necessary to verify Guizhou‘s claims of non-use. See Changzhou Trina Solar Energy Co., 352 F. Supp. 3d at 1326-27 (“Commerce, however, did not explain why the GOC‘s failure to explain this program was necessary to assess claims of non-use and why other information accessible to respondents was insufficient to fill whatever gap was left by the GOC‘s refusal to provide internal bank records.“). Commerce did not identify what information about the Export Program‘s operations would have the tendency to prove (or disprove) Guizhou‘s allegation of non-use.2 Through the fog and mist, what is clear to the court is that Commerce‘s determination—that information about the program‘s operations is “missing” from the record and is integral to Commerce‘s countervailability findings—is unsupported by substantial evidence on the record and therefore, not in accordance with the law under
And finally, we are left with Commerce‘s misunderstanding of basic AFA principles. Once again, as in Changzhou, Guizhou I, and Clearon, the court is puzzled by Commerce‘s immediate jump to AFA without first explaining how information it claims to be missing or unverifiable regarding the Program‘s operations leads to an adverse inference that the respondents used the program. For any use of facts otherwise available with an adverse inference, “Commerce must still explain what information is missing and what adverse inferences reasonably lead[] to its conclusion.” Nippon Steel Corp. v. United States, 337 F.3d 1373, 1382 (Fed. Cir. 2003). The Department‘s anemic reasoning to support its decision flunks this standard under
As it stands, Commerce‘s decision to find the Export Program countervailing as a benefit conferred on Guizhou was based on an improper application of
Plaintiffs raise several challenges to the Department‘s calculation of benchmarks measuring whether adequate remuneration was paid for synthetic rubber, natural rubber, carbon black, and nylon cord. First, Guizhou argues that the Department failed to use the proper benchmark to determine the extent of the subsidy received by Guizhou with regard to synthetic rubber. Specifically, Guizhou urges the court to compel Commerce to further provide an explanation for its change in position from its 2014 Administrative Review on market distortion for synthetic rubber. Second, Guizhou argues that Commerce‘s failure to adjust the input benchmarks to reflect market conditions—including domestic production of the inputs—was not supported by substantial evidence.
A. Legal Framework
A countervailable subsidy exists where: (1) a financial contribution is provided, (2) a benefit is thus conferred, and (3) the subsidy is specific. See
Commerce employs a hierarchical framework to measure the adequacy of remuneration. See
To measure the adequacy of remuneration for carbon black and nylon cord, Commerce used a Tier 2 benchmark, PDM 24-25; for natural and synthetic rubber, Commerce used Tier 1 benchmarks. PDM at 25-26.
B. Market Distortion for Synthetic Rubber
Commerce found that the synthetic rubber market in the PRC was not distorted during the period of review. Therefore, Commerce used Tier 1 benchmarks for imports to measure the adequacy of remuneration for this input. Plaintiffs challenge Commerce‘s distortion findings, arguing that the Department failed to distinguish its findings of lack of distortion in this review from its finding in a prior administrative review where the synthetic rubber market was distorted.
Commerce found that the market in the PRC for synthetic rubber was not distorted by government presence in the market. PDM at 25 (sustained in IDM at 6, 10-12). Plaintiffs dispute this finding as inconsistent with Commerce‘s distortion findings from the 2014 Administrative Review, where the Department found that the market was distorted by government presence “on a nearly identical set of facts,” Pls.’ Br. at 9. See Certain New Pneumatic Off-the-Road Tires From the People‘s Republic of China, 82 Fed. Reg. 18,285 (Dep‘t Commerce Apr. 18, 2017) (final results) and accompanying Issues and Decision Mem. at 13. The market distortion findings for synthetic rubber in the 2014 and 2015 Administrative Reviews are distinguished by a few percentage points: a 2.03% decrease from 2014 to 2015 in the percentage of GOC production; 3.65% decrease from 2014 to 2015 in the GOC production percent of consumption; 10.50% increase from 2014 to 2015 in the import percent of production; and a 6.04% increase from 2014 to 2015 in the import percent of consumption, Pls.’ Br. at 9-10.
Although Commerce attempts to justify its finding in the 2015 review as based on a “significant[]” change “between 2014 and 2015,” IDM at 11-12, the small percentage shifts listed above suggest otherwise. Additionally, as Plaintiffs assert, Commerce‘s explanation does little to provide support for its finding that synthetic rubber was not distorted. For example, the Final Results explain that the “significant[]” change between the two administrative reviews are reflected by the GOC‘s “decreased [] volume of [] synthetic rubber production by 8.7%” and the 33.36% increase in the volume of imports overall. Id. at 12. But that provides little analysis as to how these changes affected the Department‘s distortion calculation. And Commerce‘s analysis of market distortion from the agency record provides no further insight into Commerce‘s finding, as it simply charts the input data that was provided by GOC‘s initial questionnaire responses. See Market Distortion Mem. from Jun Jack Zhao to Tom Gilgun, J.A. Tab 3 (Oct. 2, 2017).
Both Plaintiffs and the court are left, then, to take Commerce at its word regarding its distortion findings. But Commerce is required to “examine the relevant data and articulate a satisfactory explanation for its action including a ‘rational connection between the facts found and the choice made.‘” Motor Vehicle Mfrs. Ass‘n of the U.S. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (quoting Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168 (1962)). Commerce‘s barebones explanation does no such thing and leaves the parties
In its briefing, the Government explains the “gap” between its distortion conclusion and the data presented, noting that “[b]ecause substantial government involvement in the market likely would have suppressed the share of imports of synthetic rubber as a portion of consumption in China, the high level of imports is reasonably indicative of limited government involvement in the market, and therefore of a market that is not distorted.” Def.‘s Br. at 12-13. The Government‘s “post hoc rationalizations“—as articulated in its brief—cannot be used to support the underlying determination.3 Burlington Truck Lines, 371 U.S. at 168; see also Sec. & Exch. Comm‘n v. Chenery Corp., 318 U.S. 80, 87 (1943) (“The grounds upon which an administrative order must be judged are those upon which the record discloses that its action was based.“). “The court restricts its review to matters found in the Final Determination“—that is, the grounds invoked at the agency level in the preliminary memorandum and the Issues and Decisions memorandum—and “does not consider such post hoc rationales for an agency‘s decision,” Altx, Inc. v. United States, 25 CIT 1100, 1103 n.5, 167 F. Supp. 2d 1353, 1359 n.5 (2001).
Therefore, on remand, the court orders Commerce to reconsider its findings and upon reconsideration specifically explain how the market for synthetic rubber in the PRC changed between 2014 and 2015 and what aspects of those changes caused Commerce to find that the market was not distorted in 2015.
C. Market Condition Adjustments
Commerce used Tier 1 benchmarks to measure the adequacy of remuneration for natural and synthetic rubber, and Tier 2 benchmarks for carbon black and nylon cord. Plaintiffs dispute the Department‘s calculations because, they claim, Commerce did not adjust the benchmarks to reflect prevailing market conditions in the PRC—specifically, the extent to which the market is served by domestic inputs. Here, the Department has made an AFA finding that the domestic suppliers of the four inputs purchased were government “authorities,” and were inappropriate comparatives for benchmark calculations. Based on this underlying finding, the Department‘s resultant benchmark findings are reasonable and supported by substantial evidence.
Where goods are provided for less than adequate remuneration, a benefit is treated as “conferred upon the recipient” and it is up to Commerce to calculate the benefit received. TMK IPSCO v. United States, 40 CIT __, 179 F. Supp. 3d 1328, 1344 (2016). Section
Guizhou is correct that delivery adjustments “are not without limit.” Pls.’ Br. at 13. Commerce is required to make adjustments to its LTAR benchmarks in line with the statute and the regulations; however, in terms of implementation, “Commerce has broad discretion to determine how to adjust the world market benchmark price to reflect delivery charges . . . so long as such adjustments are reasonable.” TMK IPSCO v. United States, 41 CIT __, 222 F. Supp. 3d 1306, 1320 (2017). Here, because the Department‘s calculation was contingent on an AFA finding, the court reviews Commerce‘s application of the Tier 1 and Tier 2 benchmarks for the Department‘s conformance with
Guizhou asserts that Commerce should have adjusted the benchmarks for ocean freight and import duties to account for China‘s domestic supply of the inputs. Pls’ Br. at 15. Prevailing market conditions, Guizhou continues, should account for the fact that some of the input imports “are but a small fraction of deliveries in the Chinese market.” Id. However, integral to its LTAR determinations, the Department explained that because it found that the GOC “did not act to the best of its ability to comply with [its] request for information regarding ownership and control of the producers that supplied inputs to respondents,” it concluded that the domestic suppliers of the inputs purchased were “authorities,” pursuant to the definition provided by
In its preliminary determination, Commerce explained its use of facts otherwise available to infer that “all of Guizhou Tyre‘s supplying producers are ‘authorities.‘” PDM at 24. For example, in calculating an appropriate benchmark for all four inputs, the Department noted that “the GOC did not act to the best of its ability to comply with the Department‘s request for information with regard to ownership and control of the producers that supplied the input to respondent.” Id. Therefore, the Department concluded, “none of the respondent‘s domestic purchases of the input is appropriate for benchmarking.” Id. This makes sense: Commerce is tasked with measuring the adequacy of remuneration by comparing the government price to a hierarchy of benchmarked prices. During the administrative review (and then again in this litigation), Guizhou offers the Department a “supply ratio” “solution” to the benchmark adjustment, which would apportion the adjustments to the share of the market attributed to imports. Pls.’ Br. at 15. But because that ratio would include Guizhou‘s domestic purchases—which were found to be an inappropriate comparative for benchmarking—their inclusion would distort the benchmark analysis. This same analysis was echoed in the Department‘s Final Results: in light of the AFA finding that the domestic producers of the inputs
The court does not generally presume the reasonableness of the AFA determination. However, Guizhou does not adequately address Commerce‘s conclusion that the supplying producers were “authorities” in its briefing, dismissing this AFA finding as “say[ing] nothing about the benchmark calculation.” Pls.’ Reply Br. In Support of Mot. for J. 9, ECF No. 37 (Jan. 18, 2019). Nor did Plaintiffs actually dispute the application of AFA to the LTAR calculations in its case briefs to the Department during the administrative review. Commerce may use AFA if the gap in the record was caused by the failure of the respondent to cooperate to the best of its ability. JSW Steel Ltd. v. United States, 42 CIT __, 315 F. Supp. 3d 1379, 1382 (2018) (citing
III. Processing Trade Program
Commerce investigated import duty and VAT exemptions on imports of raw materials from the Processing Trade Program and concluded that the program provided countervailable subsidies. Plaintiffs dispute these findings as unsupported by substantial evidence and contrary to law. The court upholds the Department‘s determination as to the Processing Trade Program as supported by substantial evidence drawn from the record.
The regulatory scheme under
Plaintiffs now dispute the Department‘s finding that the exemptions provided under the program were countervailable. This issue was also raised in the 2014 Administrative Review and was previously discussed in detail by the court. Guizhou Tyre Co., 348 F. Supp. 3d at 1268. Plaintiffs raise largely the same claims today. First, Guizhou argues that it submitted detailed records as to unit consumption of raw materials, receipt of raw materials under the program, re-export of goods produced from those raw materials, and any entry of such materials into the domestic market. Pls.’ Br. at 34. According to Guizhou, the Department ignored these submissions during its review when it countervailed duty exemptions on the premise that the Program failed to satisfy the requirements under
As before, when prompted to explain how the GOC determined the quantity of the materials consumed in the production process, the GOC first referred Commerce to the Customs Measure, attached as Exhibit E.7 to its questionnaire response. GOC Initial Questionnaire Resp. at 97. As to Guizhou specifically, the GOC referred Commerce to “Guizhou Tire‘s response for a more comprehensive response and for sample documentation supporting its explanation.” Id. at 98. But again, as before, these generic responses concerning consumed materials in the production falls short of demonstrating how the GOC determines the quantity of the inputs consumed in the production process: rubber, nylon cord, and carbon black. And that is precisely what Commerce focused on in its Final Results: that the GOC failed to “specifically explain or document how it determined the quantity of rubber, nylon cord or carbon black consumed in the production process.” I&D Mem. at 16. Moreover, it was not unreasonable for Commerce to find that even Guizhou‘s questionnaire responses failed to indicate that the GOC has the requisite system or procedure in place. Guizhou stated first that at the time of the application, it “was not legally obligated to report the unit consumption to the Customs for the record.” Guizhou Initial Questionnaire Resp. at 22. Guizhou‘s continued response outlined the general process of unit consumption verification (“[t]o verify the authenticity and accuracy of unit consumption, Customs . . . examine[d] the supporting documents and conduct an on-site inspection,” id.), but certainly, the Department maintains discretion “and ‘authority to determine the extent of investigation and information it needs.‘” Polyethylene Retail Carrier Bag Comm. v. United States, 29 CIT 1418, 1433, 2005 WL 3555812, at *12 (2005) (citing PPG Indus., Inc. v. United States, 978 F.2d 1232, 1238 (Fed. Cir. 1992)).
The same goes for the Department‘s decision to discount verification evidence submitted by Guizhou. Guizhou claims that the verification reports allowed Commerce officials to trace the reported value of the inputs through the company accounts and verify that the GOC detected certain inputs were sold into the local market by Guizhou and Guizhou paid the duties for
All in all, Commerce‘s review of the record evidence was reasonable and its decision to countervail the Processing Trade Program is supported by substantial evidence that the court will not now disturb.
CONCLUSION
The court sustains the Department‘s decision to countervail the Processing Trade Program. The court also sustains the Department‘s Tier 1 benchmark calculations to measure the adequacy of remuneration for natural and synthetic rubber, and Tier 2 benchmarks for carbon black and nylon cord, despite Guizhou‘s argument that the benchmarks did not reflect prevailing market conditions in China. However, the Department‘s decision to apply AFA regarding China‘s Export-Import Bank Buyer‘s Credit Program was unreasonable because Commerce reached unsupported findings as to missing material information and verifiability. Additionally, the Department is ordered on remand to reconsider and explain fully how it came to its distortion findings for the synthetic rubber market—specifically, as it diverges from its opposite findings in the 2014 Administrative Review.
For the foregoing reasons, after careful review of all papers, it is hereby
ORDERED that the Department‘s decision to apply AFA as to the PRC‘s Export Buyer‘s Credit Program based on an alleged lack of cooperation was unlawful because Commerce demonstrated no gap in the record, the respondents submitted evidence of non-use of the Program, and the Department‘s findings of unverifiability of necessary information was unsupported by record evidence; it is further
ORDERED that Commerce, on remand, reconsider its adverse inference that the PRC‘s Export Buyer‘s Credit Program was used by Guizhou‘s customers and reach a new determination on this issue based on findings supported by substantial record evidence; it is further
ORDERED that the Department reconsider its findings and upon reconsideration, explain how the market for synthetic rubber in China changed between 2014 and 2015 and what aspects of those changes caused Commerce to find that the market was not distorted in 2015; it is further
ORDERED that all other challenged determinations of Commerce are sustained; and it is further;
ORDERED that Commerce shall have ninety (90) days from the date of this Opinion and Order in which to file its redetermination, which shall comply with all directives in this Opinion and Order; that the Plaintiff shall have thirty (30) days from the filing of the redetermination in which to file comments thereon; and that the Defendant shall have thirty (30) days from the filing of Plaintiff‘s comments to file comments.
Dated: May 15, 2019
New York, New York
/s/ Richard W. Goldberg
Richard W. Goldberg
Senior Judge