AD Respondent Contests Adjustments to Expense Fields to Account for 'Overpaid Allowances'
Exporters PT Ecos Jaya Indonesia and PT Grantec Jaya Indonesia -- two companies collapsed into one for antidumping duty procedural purposes -- took to the Court of International Trade on Jan. 21 to contest the 2022-23 review of the AD order on mattresses from Indonesia. Ecos/Grantec challenged the Commerce Department's determination to adjust three expense fields to include "overpaid allowances," along with the agency's adjustments to the companies' total cost of manufacturing under the "transactions disregarded" provision of U.S. antidumping law (PT Ecos Jaya Indonesia v. United States, CIT # 24-00238).
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Ecos/Grantec received a 30.32% AD rate in part after Commerce adjusted its U.S. inland freight expenses from warehouse to the unaffiliated customer and other direct selling expenses to include overpaid allowances. The respondent said the agency "mischaracterized such expenses as 'actual remittance'" when the respondent's questionnaire responses show that the amounts were "common overages that will be refunded to Ecos/Grantec's affiliates."
The overages are "typical for the industry and take customers a significant amount of time to resolve," the complaint said. Commerce unreasonably distorted the AD calculations by "ignoring the nature of the sales channel, and the common practices of the industry as a whole," the brief said.
In the review, Commerce also adjusted Ecos' total cost of manufacturing to remove affiliated transactions. Administratively, and now at CIT, the respondent argued that no such adjustment should be made, since the transactions to affiliates were made at "arm's length."
The transactions with affiliated parties "fairly reflect the amount usually reflected in sales of merchandise under consideration in the market under consideration" as required by law, the brief said. "By failing to consider that Commerce may disregard insignificant adjustments elsewhere under the normal value statue, Commerce unreasonably applied different standards to different aspects of the antidumping duty calculations to address the same question -- whether transactions with affiliated parties were at arm’s length," the respondent argued.