Thai Tire Exporter Challenges 'Punitive' AFA Rate in AD Investigation
Tire exporter Bridgestone Americas Tire Operations filed a 10-count complaint at the Court of International Trade on Dec. 23, challenging the Commerce Department's use of adverse facts available against the company in the antidumping duty investigation on truck and bus tires from Thailand (Bridgestone Americas Tire Operations v. United States, CIT # 24-00263).
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In the investigation, Commerce used AFA against Bridgestone for supposedly withholding information (1) pertaining to GCR, an affiliated tire reseller in the U.S.; (2) "related to rebates paid to U.S. customers"; (3) "related to other discounts"; and (4) "related to the destination of its U.S. shipments." The exporter said Commerce had insufficient grounds to impose AFA, arguing that the resulting 48.39% rate is "disproportionate and punitive."
Relating to GCR, Bridgestone told Commerce that most of the affiliate's locations were sold to unaffiliated parties before the investigation period, save for 11. However, two of the 11 locations were sold 14 days after the start of the investigation period. The remaining nine remained affiliated throughout the investigation period.
The exporter said it reported its sales to all GCR locations along with a list of customer codes and ship-to codes that "could be used to identify which sales were made [to] affiliated or unaffiliated GCR locations." In its verification report, Commerce said it asked Bridgestone to submit a reconciliation of its accounts receivable for sales made to affiliated GCR locations."
The exporter said this is "factually incorrect," claiming that Commerce at verification only requested accounts receivable for the 11 GCR locations. Bridgestone said it submitted the accounts receivable reports for the locations but Commerce declined to accept them on the grounds that the person that prepared the report wasn't available at the exact time the agency requested to speak with them. Bridgestone said that during verification it had a total of 14 people "on standby to answer any questions from the verifiers."
As a result, the company said, Commerce's finding that Bridgestone withheld information is "an abuse of discretion," since the reports were available for review at 9 a.m. on the last day of the review and Commerce asked to speak with the person who prepared the reports at around 3:30 p.m. that day. When that person was unavailable at that moment, the agency declined to accept the accounts receivable reports.
In addition, Commerce said it needed the accounts receivable reports to verify the "affiliation status of the GCR locations" and the "reasonableness" of the Bridgestone employees' methodology "to account for sales to unaffiliated customers." The company said in response that its reports aren't rationally related to either issue. Commerce focused only on sales to GCR, meaning there's "no rational connection between the two points Commerce claimed to have failed to verify and the absence" of the reports on the record.
Bridgestone's sales to the 11 GCR locations accounted for a small percentage of the company's U.S. sales, making the total AFA rate disproportionate to the alleged misconduct, the brief added.
The exporter also railed against Commerce's invocation of AFA related to its failure to provide a breakdown list of the largest and smallest total values received by its customers for each type of rebate. Bridgestone said it disclosed three U.S. rebate programs and that it provided the requested rebate breakdown list as requested. The agency "not only reviewed, but used, the complete list to identify the customers with the highest and lowest rebate values," the brief said.
Bridgestone also said Commerce errantly used AFA due to to the company's alleged failure to provide documentation regarding the credit balance in one of its accounts and relating to "other discounts." Regarding the credit balance, Bridgestone said "Commerce failed to articulate a rational explanation as to how the alleged failure to provide the requested credit balance documentation rendered Bridgestone’s sales information so unreliable as to justify application of Total AFA."
On the "other discounts," Bridgestone said that it gave Commerce a "monthly schedule of debit and credit notes" at verification with an explanation of how it ties to the company's accounting system. The verification report from the agency confirms that company officials gave a monthly schedule of total credit and debit notes issued to dealers. However, Commerce said it didn't get an itemized reconciliation for "other discount" values reported in this schedule to Bridgestone's accounting system. The exporter reexplained how the amounts in the schedule tied to its accounting system.
Nevertheless, Commerce said it requested a reconciliation between credit and debit notes and Bridgestone's accounting system. In response, Bridgestone said no "such request was made, and no such request is referenced in the verification outline or report," making the use of AFA on this point unlawful.