Commerce Must Give Yarn Exporter Chance to Fix Issues in Verification, Trade Court Rules
The Commerce Department didn't give antidumping duty respondent PT. Asia Pacific Fibers a "reasonable" chance to address issues found by Commerce in the company's verification responses, the Court of International Trade ruled Dec. 12. Because Commerce never issued a verification report to Asia Pacific, Judge Richard Eaton said the agency must report the "methods, procedures, and results" of verification and let the company address any issues.
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Eaton also ruled that Asia Pacific didn't fail to exhaust its claims against Commerce's verification procedure by failing to raise them administratively. Since the agency didn't say the exporter failed verification until it issued its final determination in the antidumping duty investigation on polyester textured yarn from Indonesia, Asia Pacific wasn't required to exhaust administrative remedies, the court said.
In the investigation, Commerce used a questionnaire instead of an on-site verification because of COVID-19 travel restrictions. Eaton noted that Commerce never produced a verification report, and the exporter only learned of "deficiencies" in its verification questionnaire in the investigation's final determination. Because of the alleged deficiencies, the agency hit Asia Pacific with a 26.07% adverse facts available rate.
Eaton disagreed with the argument that Asia Pacific had to raise the issue administratively, noting that Commerce never issued a verification report, so Asia Pacific didn't know it had "failed verification by that date or that adverse facts available would be used in place of all of the information it had reported." The judge also said Commerce's failure to produce the verification report was illegal and amounted to an "abuse of discretion."
Asia Pacific was "blindsided" by the use of AFA since the company couldn't have predicted Commerce would change its position from its initial decision not to, the opinion said. The agency's actions also were "unreasonable under the circumstances," since it normally gives the respondent a chance to "go to its file cabinets and produce some information" during on-site verification.
It is "impossible to know whether Plaintiff could have addressed Commerce's questions in its case brief or produced the kind of evidence normally produced at on-site verification" and avoid an AFA rate, the judge said. "The special circumstances of the pandemic prevented an on-site verification. The circumstances did not, though, prevent the sending of a supplemental verification questionnaire."
(PT. Asia Pacific Fibers TBK v. United States, Slip Op. 23-175, CIT # 22-00007, dated 12/12/23; Judge: Richard Eaton; Attorneys: Lizbeth Levinson of Fox Rothschild for plaintiff PT. Asia Pacific Fibers TBK; Eric Singley for defendant U.S. government; Julia Kuelzow of Kelley Drye for defendant-intervenors Unifi Manufacturing, Inc. and Nan Ya Plastics Corp.)