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Trade Court Upholds AD Review of Off-Road Tires From China on Second Remand

The Court of International Trade on May 18 sustained a second remand redetermination by the Commerce Department in its seventh administrative review of the antidumping duty orders on off-road tires from China, finding Commerce permissibly applied its methodology when it denied separate rate status to Chinese exporters Guizhou Tyre Import and Export (GTC) and Aeolus Tyre and instead assigned the "China-wide" AD rate of 105.31%.

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Both Aeolus and GTC argued that Commerce must base its decision on the total body of record evidence and said that Commerce only investigated whether the companies had autonomy from the government in making management selections and profit distribution decisions. Judge Timothy Stanceu disagreed, saying that because Commerce's methodology "exists apart from the provisions in the Tariff Act and regulations," there was no statutory language, legislative history, or regulatory language to lead the court to conclude that Commerce's methodology was unreasonable.

After the first remand Commerce identified four factors in identifying independence from government control (whether the export prices are subject to government approval, whether the respondent has authority to negotiate and sign contracts, whether the respondent has autonomy in selecting management, and whether it retains the proceeds of its export sales) and said that its separate rate test "examines all four de facto criteria.” The court again remanded the case to Commerce, holding that the agency contradicted its depiction of a four-factor test when it said a respondent could be ingeligible for failing to rebut only one of the four criteria.

On the second remand, the court found that Commerce made a finding on each prong of its four-criteria test with respect to both Aeolus and GTC. The agency determined that both companies failed to establish autonomy in the selection of management and that GTC also failed to establish its independent decision-making when allocating profits.

Stanceau said that the court must recognize Commerce's discretion to draw reasonable inferences from evidence on the record and was bound by federal circuit precedent, which had repeatedly affirmed Commerce's authority to apply a rebuttable presumption of government control in determining which exporters and producers of a nonmarket economy country to include within the NME-wide entity.

(Guizhou Tyre v. United States, Slip Op. No. 23-79, CIT # 17-00100, dated 05/18/23; Judge: Timothy Stanceu; Attorneys: Ned Marshak of Grunfeld Desiderio for plaintiffs Guizhou Tyre Co., Ltd. and Guizhou Tyre Import and Export Co., Ltd.; and John Todor for defendant U.S. government)