CIT Sustains Commerce's Surrogate Value Picks in AD Review on Activated Carbon
Exporter Jilin Bright Future Chemicals Co. failed to raise arguments on the surrogate value of bituminous coal in an antidumping duty review, the Court of International Trade ruled Dec. 21. Judge Mark Barnett said that despite Jilin Bright's argument, "this case fits squarely into the classic administrative exhaustion paradigm."
Sign up for a free preview to unlock the rest of this article
Export Compliance Daily combines U.S. export control news, foreign border import regulation and policy developments into a single daily information service that reliably informs its trade professional readers about important current issues affecting their operations.
In the 14th AD review of activated carbon from China, Jilin Bright said it was only asked to address a certain formula regarding the conversion of the coal's heat value scale for purposes of picking the proper Harmonized Tariff Schedule subheading to value the coal. But Barnett said, "contrary to Jilin Bright’s argument," the exporter "had notice that calorific conversion was an open issue."
Because the alternative conversion formulas were addressed by the petitioners and another exporter, "Jilin Bright knew or should have known that this issue was undecided, yet it failed to raise any arguments before the agency, as it was required to do."
The court also sustained Commerce's rejection of an argument revived by Jilin Bright initially argued administratively by exporter Datong Juqiang Activated Carbon Co. regarding "benchmark data for bituminous coal valuation." During the review, Datong floated benchmark data from a Chinese coal exporter and the U.S. Energy Information Administration which showed the price of coking coal to be higher than the price of non-coking coal. Datong also claimed that the Malaysian import data used by Commerce was not product-specific and anomalous.
While this data was rejected administratively, Jilin Bright argued that the Malaysian import data used by Commerce "has the opposite price correlation as world and U.S. prices" for coking and non-coking coal and that the agency didn't consider detracting evidence, including the benchmark submitted by Datong. Barnett said that the agency did actually consider Datong's, and now Jilin Bright's, argument, and "declined to reject the Malaysian data based on the argument about the relationship between coking and non-coking coal prices."
The court said it "understands Commerce’s preference for relying on benchmark data from economically comparable countries," making Jilin Bright's global prices "less informative than the data identified by Commerce." Barnett also noted that, at most, the data proposed by Jilin Bright "suggests inconsistencies between Malaysian imports" under two HTS subheadings and doesn't explain how the numbers would render the data under one of the headings "aberrant."
Barnett lastly addressed Jilin Bright's challenge to the decision to use Malaysian import data under HTS heading 2706 to value coal tar pitch in reliance on the Global Coal Tar and Coal Tar Pitch Report. The exporter said the report shows that Malaysian import data under HTS 2706 is "anomalous" and shouldn't be used, adding, among other things, that the report included a methodology section making Commerce's decision unsupported.
The court rejected the arguments, finding that the inclusion of this section "is of no consequence if it does not adequately describe the methodology such that Commerce may verify the data or confirm its representativeness and determine the inclusion of taxes or duties."
(Jilin Bright Future Chemicals Co. v. United States, Slip Op. 23-188, CIT # 22-00336, dated 12/21/23; Judge: Mark Barnett; Attorneys: Jonathan Freed of Trade Pacific for plaintiff Jilin Bright Future Chemicals Co.; Francis Sailer of Grunfeld Desiderio for plaintiff-intervenors led by Ningxia Guanghua Cherishmet Activated Carbon Co.; Emma Bond for defendant U.S. government; John Herrmann of Kelley Drye for defendant-intervenors Calgon Carbon Corp. and Norit Americas, Inc.)