Petitioners Say Commerce Baselessly Distinguished ‘Rough’ From ‘Unfinished’ Pipe Fittings
The Commerce Department was wrong to find that an importer's “unfinished” carbon steel butt-weld pipe fittings were different than its “rough” fittings because that distinction was not in the language of the relevant scope order, two petitioners said in a March 18 motion for judgment (NORCA Industrial Company, LLC v. U.S., CIT Consol. # 23-00231).
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The petitioners, Tube Forgings of America and Mills Iron Works, said Commerce shouldn't have ruled in a covered merchandise inquiry that importer Norca’s “rough” pipe fittings were not within the scope of an AD order on Chinese carbon steel butt-weld pipe fittings.
“Unfortunately, Commerce’s CMI Determination guts the China Order by creating a path for any party to follow to avoid antidumping duties against CSBWPF from China,” it said.
Commerce found that “merchandise shaped into the rough form of elbows, tees, or reducers in China, but not reformed/sized (or heat treated)” before export to Vietnam was not in-scope, the petitioners said.
But the scope language “plainly” describes all of the pipe fittings, including “in either finished or unfinished form,” the petitioners said. Record evidence indicates that the pipe fittings industry uses the terms “rough,” “as formed” and “unfinished" interchangeably, they argued.
They also said that the pipe fittings were not substantially transformed after being exported to Vietnam, and that the scope order’s petitioners intended for all butt-weld fitting imports to be covered.
The petitioners said the department unlawfully found that the scope order was ambiguous because it didn't define the term “unfinished fittings” and went on to look at primary and secondary interpretive sources to make its determination.
“This rationale fails because the term ‘unfinished fittings’ does not appear in the China Order,” they said. “The China Order plainly covers ‘carbon steel butt-weld pipe fittings in either finished or unfinished form’ without limitation or qualification, and thus applies to all CSBWPF that are sufficiently formed as to be identifiable as such. “
This difference -- between “unfinished fittings” and “fittings in finished or unfinished form” -- is substantive, not technical, they said. They said the department’s “focus on ‘unfinished fittings’ as a distinct category” meant that it had failed to understand the order applied to all fittings, regardless of state of completion.
In finding that Norca’s “rough” fittings were not the same thing as “fittings in … unfinished form,” Commerce was illegally substituting primary and secondary source interpretations in for the plain language of an order, the petitioners said.
The department “appears” to have made that distinction “because it focused on language in CBP’s referral request rather than the scope language of the China Order,” they said.
The petitioners also took issue with Commerce’s claim that the covered merchandise inquiry would not have been necessary “had the plain language of the scope been as clear as the petitioners suggest.”
“Unambiguous scope language in an order does not bar a scope (or covered merchandise) inquiry,” they said.