End Use Not Automatically Considered in Most Scope Rulings, US Says
The Commerce Department doesn't consider a product's end-use while making scope rulings unless required to by the relevant antidumping or countervailing duty order, the government said March 26 as it opposed summary judgment in a scope ruling case regarding edge-glued boards from China (Hardware Resources v. U.S., CIT # 23-00150).
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In a Jan. 26 motion for judgment, importer Hardware Resources argued that its products shouldn't be covered by antidumping and countervailing duty orders on wood mouldings and millwork products (see 2401290043). The importer claimed that its edge-glued boards aren't covered by the orders’ plain language because they are intended for cabinetmaking, not moulding or millwork.
However, Commerce doesn't usually make scope ruling decisions based on a product’s end use unless the scope language specifically directs it to do so, the government said. This practice has been upheld by the U.S. Court of Appeals for the Federal Circuit, which found that end-use limitations are “difficult to enforce” because “the physical characteristics of an imported product are more readily identifiable than the product’s end use,” it said.
Because the the AD/CVD orders on moulding and millwork products don't discuss end use, Hardware’s boards, whose physical characteristics match those described by the orders, are subject to them, it said.
Hardware also argued that its boards aren't “continuously shaped,” and thus not covered by the orders' plain language. The importer said that each of its boards has a 1 mm score along its edge for ease of future cabinet assembly. But the orders don't define “continuously shaped wood” and the (k)(1) factors never mention “scores,” it said.
The government said Commerce did have to conduct a (k)(1) analysis after finding the term “continuously shaped wood” to be ambiguous. The orders’ petition, it noted, defined the term as “wood that is … grooved,” and explained that a groove was a “cut with, or parallel to the grain.”
Although scored boards were not mentioned in the (k)(1) factors, Commerce held that “there is no evidence that [Hardware’s] score differs in any material way from a groove,” it said. Hardware’s argument to the contrary “elevates form over substance,” it said.
The U.S. also said that the UV coating on Hardware’s boards didn't exclude them from the orders because the orders specify they cover “coated” products as well.
It noted that Hardware isn't arguing that its products should instead be covered by AD/CVD on wooden cabinets from China “despite claiming that its products should be excluded from the wood mouldings and millworks products Orders due to later use as cabinet parts.”