Exporter, US, Petitioners Tussle Over Use of NME Data in ME Case
After oral arguments regarding a Cambodian mattress exporter’s antidumping duty rate, the exporter, the U.S. and petitioners filed post-argument submissions Feb. 7 that focused on the Commerce Department's use of nonmarket economy data in a market economy case (Best Mattresses International v. U.S., CIT Consol. # 21-00281).
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In calculating expenses incurred by the Cambodian mattress exporter to establish its products’ normal value, Commerce shouldn't have excluded input cost data from nonmarket economies, nor should it instead have simply averaged the cost data of two surrogates, exporter Best Mattresses International is arguing before the court. When the department did so on remand, Best Mattresses’ AD rate jumped from 45.34% to 103.79%.
Best Mattresses said that the government had, in oral arguments, “failed to address the shortcomings in Commerce’s support for its remand determination on this issue.”
The U.S. relied on the poor sourcing that appeared in Commerce’s remand redetermination, the exporter said. In all the cases Commerce cited in that redetermination, the exporter at issue came from a nonmarket economy, whereas Cambodia is a market economy, it said. The government also relied on the department’s citation of the investigation’s petition, but “the standard for Commerce to initiate a petition is low,” it said, and Commerce didn’t even discuss concerns about nonmarket economy countries’ data initially.
“That Commerce led with the Petition as support in its remand redetermination merely exposes that it had no solid ME practice or precedent to support its determination here,” it said.
Best Mattresses also pushed back on Commerce’s decision to, in lieu of using cost data from the countries in controversy, calculate Best Mattresses’ costs by averaging the costs of two surrogates, Emirates Sleep and Grand Twins International. The financial records the U.S. has had access to from Emirates has been incomplete, “missing vital information,” the exporter said.
Emirates’ records have faced fire in other cases as well. The Indian exporter was used as a surrogate in another case regarding mattresses from Vietnam despite Commerce lacking access to five of the company’s financial annexes (see 2401260036).
Several cases that the U.S. and petitioners cite to support their averaging method actually demonstrate Commerce’s usual practice of excluding incomplete statements from its calculations, it said. It said Commerce instead “has an obligation to choose the best of two statements and has done so in the past.”
The U.S. and mattress petitioners led by Brooklyn Bedding also filed their own post-argument submissions.
So long as the department’s decisions are reasonable, “Commerce is accorded wide discretion” in choosing the best information to rely on in calculating surrogate values, the U.S. said. After the remand, Commerce revisited its usual practice of excluding data from nonmarket economy countries “unless a party can rebut the presumption of unreliability,” it said.
The government cited several cases as “additional precedent,” including a “companion mattresses case” and several others. On the flip side, it said Best Mattresses “provides no binding authority” and “unsuccessfully mischaracterizes” the cases Commerce cited in its remand redetermination. The authorities the exporter calls on, such as policy memoranda from the department, have either been reversed or don't exclude any of Commerce’s calculation decisions, it said.
Petitioners agreed with the government, saying that Commerce’s cited cases do involve exporters from market economies facing the presumption of unreliability.