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Trade Court Upholds Negative Evasion Finding for 2 Pipe Fitting Importers

The Court of International Trade on Feb. 7 upheld CBP's decision to reverse its finding that importer Norca Industries Co. and International Piping & Procurement Group evaded the antidumping duty order on pipe fittings from China. The negative evasion finding came after CBP made a covered merchandise referral to the Commerce Department on remand. The referral found that the importers' carbon steel butt-weld pipe fittings were outside the order's scope.

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Judge Jennifer Choe-Groves found the negative evasion finding to be backed by substantial evidence and in compliance with the court's remand order.

"Norca and IPPG are relieved that the matter concluded and that they have been vindicated," Jeremy Dutra, counsel for the importers, said in an email. "We argued from the outset of the proceeding -- nearly four years ago -- that the antidumping duty order did not cover the merchandise at issue. Commerce agreed with us based on previous rulings issued under the order, and CBP finally acknowledged that Norca’s and IPPG’s supplier performed extensive production in Vietnam and did not engage in evasion. It is unfortunate that it took this long for Norca and IPPG to receive justice. This is a proceeding that never should have been initiated based on the law and absence of credible allegations by the alleger, who ultimately abandoned the proceeding. And CBP never should have found evasion. Regardless, the truth prevailed and both Norca and IPPG have been fully cleared of any wrongdoing."

CBP initially said Norca and International Piping evaded the AD order by transhsipping their goods through Vietnam. After Norca filed suit at CIT, CBP said it became aware that information from a site visit to Vietnamese manufacturer BW Fittings wasn't added to the record. The agency asked for a remand to add this data.

On remand, CBP said it was unable to find if the importers' goods were covered by the AD order, referring the inquiry to Commerce. The referral saw Commerce review the three stages of the pipe fittings' manufacturing process. The agency found that goods that undergo only the third stage, which covers finishing processes, in a third country are covered goods, but that products that only undergo the second and third stages, which cover reforming or sizing the rough fitting, are outside the order's scope.

After looking at the development of the Vietnamese manufacturer's manufacturing abilities, which evolved over the review period to include all three stages of production, Commerce said none of the importers' goods fit under the AD order. CBP relied on this finding on remand to say there was no evasion (see 2401240035).

(Norca Industrial Co. v. United States, Slip Op. 24-12, CIT Consol. # 21-00192, dated 02/07/24; Judge: Jennifer Choe-Groves; Attorneys: Peter Koenig of Squire Patton for plaintiffs Norca Industrial Co. and International Piping & Procurement Group; Margaret Jantzen for defendant U.S. government)