CIT Eliminates Expedited Reviews for Countervailing Duty Cases
A Commerce Department regulation establishing expedited reviews for countervailing duty investigations was vacated in an Aug. 18 opinion from the Court of International Trade. Chief Judge Mark Barnett penned his fourth opinion in the case, upholding Commerce's finding that it couldn't find any alternative statutory basis on which to find that the regulation can exist.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
The case stems from a January 2018 CVD order on certain softwood lumber from Canada. In March of that year, Commerce conducted an expedited CVD review for various Canadian lumber companies that were assigned the all-others rate. A few of those producers, namely D&G, Lauzon, NAFP, Rold Boulanger & Cie Ltee, Lemay and all of their cross-owned affiliates, received de minimis CVD rates, rendering them exempt from the CVD order.
However, a legal question loomed over the proceedings: Did Commerce actually have the right to conduct the expedited review? In its defense, Commerce relied on section 103(a) of the Uruguay Round Agreements Act as the legal authority for its federal regulation, 19 C.F.R. § 351.214(k), and its use of CVD expedited reviews. In a previous opinion, the court found otherwise, finding that in section 103(a) "Congress explicitly limited Commerce’s regulatory authority to enacted provisions and did not 'encompass perceived international obligations that Congress did not implement through the URAA.'"
On remand, Commerce weighed various legal alternatives to back its use of the expedited reviews but came up empty handed. Using the Administrative Procedure Act as the judicial standard governing Commerce's finding, the agency couldn't find a home in U.S. law for the expedited review process. "While the Canadian Parties take issue with the depth of Commerce’s analysis of certain statutory provisions, Commerce considered these alternatives and explained its reasons for finding that the provisions do not support the regulation," Barnett said. "Moreover, the Canadian Parties do not develop the argument that Commerce’s determination is arbitrary, capricious, or an abuse of discretion. Instead, they argue that Commerce’s statutory interpretations are largely incorrect."
In upholding Commerce's determination, Barnett ruled that companies deemed excluded from the CVD order due to the expedited reviews shall prospectively be reinstated as subject to it. Commerce shall also impose a cash deposit requirement based on the all-others rate from the investigation or the company-specific rate determined in the most recently completed administrative review in which the company was reviewed, Barnett said.
(Committee Overseeing Action for Lumber International Trade Investigations or Negotiations et al. v. United States, Slip Op. 21-104, CIT Consol. # 19-00122, dated 08/18/21, Judge Barnett. Attorneys: Lisa Wang of Picard Kentz for plaintiff Committee; Stephen Tosini for defendant U.S. government)