CIT Upholds ITA Reseller Policy Making Certain Resellers Subject to AD All Others Rate

(This AD Reseller Policy, which is only for market economy countries, states that automatic liquidation at the AD cash deposit rate of the producer will apply to a reseller, who does not have its own rate, only when no AD administrative review has been requested of either the reseller or the producer.

If a review is conducted of a producer of the reseller's merchandise where entries were suspended at the producer's rate, automatic liquidation will not apply to the reseller's sales.

Instead, if the ITA determines that the producer knew, or should have known, that the merchandise it sold to the reseller was destined for the U.S., the producer's assessment rate will be used.

Otherwise, the reseller's merchandise will be liquidated at the all-others rate, if no company-specific review was done of the reseller. See ITT's Online Archives, or 03/10/06 news, 06031015, for BP summary of this AD policy, which does not apply to non-market economy countries such as China.)

In this case, Impact Steel challenged the ITA's AD Reseller Policy and its application to administrative review liquidation instructions, arguing that the Reseller Policy is "arbitrary" and "capricious" as it requires entries not subject to a review request to be liquidated at a rate different from the required AD deposit rate at the time of entry.

However, the CIT ruled that the Reseller Policy does not conflict with governing statute or the automatic liquidation provisions of 19 CFR 351.212(c)(1), but instead, merely fills a gap in the regulation by addressing a situation not specifically addressed therein.

The CIT added that the ITA acknowledged that its Reseller Policy would increase the uncertainty faced by resellers that have not established whether or not they are affiliated with a producer. However, the reseller can diminish this uncertainty by requesting an AD administrative review of its own entries in order to obtain its own AD cash deposit rate, and the Reseller Policy does not prevent the withdrawal of such a request if no request is made as to the relevant producer.

For these and other reasons, the CIT ruled that the ITA's use of the Reseller Policy was not arbitrary or capricious.

CIT Slip Op. 07-187 (dated 12/28/07) available at: http://www.cit.uscourts.gov/slip_op/Slip_op07/07-187.pdf

BP Note

1. CFR 351.212(c), provides:

(c) Automatic assessment of antidumping and countervailing duties if no review is requested.

(1) If the Commerce Secretary does not receive a timely request for an administrative review of an order, the Secretary, without additional notice, will instruct the Customs Service to:

(i) Assess antidumping duties or countervailing duties, as the case may be, on the subject merchandise described in section 351.213(e) at rates equal to the cash deposit of, or bond for, estimated antidumping duties or countervailing duties required on that merchandise at the time of entry, or withdrawal from warehouse, for consumption; and

(ii) To continue to collect the cash deposits previously ordered.

(2) If the Secretary receives a timely request for an administrative review of an order, the Secretary will instruct the Customs Service to assess antidumping duties or countervailing duties, and to continue to collect cash deposits, on the merchandise not covered by the request in accordance with paragraph (c)(1) of this section.

(3) The automatic assessment provisions of paragraphs (c)(1) and (c)(2) of this section will not apply to subject merchandise that is the subject of a new shipper review or an expedited antidumping review.