Rebar Exporter, Petitioner Challenge Specificity, Benchmark Elements of CVD Case at CIT
Exporter Kaptan Demir Celik Endustrisi ve Ticaret and petitioner Rebar Trade Action Coalition each contested an element of the Commerce Department's remand results in a case on the 2020 review of the countervailing duty order on Turkish rebar. In comments to the Court of International Trade laying out their disagreements, Kaptan challenged Commerce's use of a report from Colliers International as a benchmark in assessing the benefit Kaptan derived from the provision of land for less than adequate remuneration, while the coalition challenged the agency's finding that exemptions from Turkey's Banking Insurance and Transaction Tax were neither de jure nor de facto specific (Kaptan Demir Celik Endustrisi ve Ticaret v. United States, CIT # 23-00131).
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The trade court remanded the review last year, telling the agency to reconsider its finding that the Turkish tax program was de jure specific and the use of the Colliers report (see 2410210019). On remand, Commerce decided not to countervail the tax exemptions but stuck with its use of the Colliers report, rejecting Kaptan's claims that a report from C&W was superior (see 2501230036).
Contesting the remand, the petitioner argued that the agency erred in finding that the tax exemptions are neither de jure nor de facto specific. The coalition said Commerce should use adverse facts available regarding the specificity of the program given the failure of the Turkish government to "specify the parameters of how it defines an 'industrial establishment' or identify or explain the criteria under which it granted or denied" industrial registry certifications to applicants.
The petitioner said that since the Turkish government failed to give enough information to find which Turkish companies must obtain a certificate, the agency was required to "look at other record information, including information regarding the number and types of industries that actually obtained" a certificate, "to fill the record gap."
Kaptan challenged Commerce's benchmark pick, noting that the agency declined to consider the C&W report, since the report incorporates a risk of litigation-inspired "fabrication or exaggeration," and the Colliers report doesn't have that same risk. The agency said "contemporaneous original research from an independent, third-party source is a strict preference in comparing benchmarks."
The exporter said it conducted a Lexis search of Commerce decisions and found that the agency has never before used the phrase "strict preference" in a CVD or antidumping duty case, meaning the "precise contours of this novel formulation are uncertain." Regardless, "nothing in this formulation precludes the use of the C&W report, which is clearly original research, which is contemporaneous, and which is from an independent, third-party source," Kaptan argued.
The respondent emphasized that it's not questioning the "expertise" of the Colliers report, but simply claiming that the C&W report is superior "on substantive grounds." Namely, the exporter said the fact that the Colliers properties are "all in the Instabul area," which has a "thoroughly different" economic profile than properties in the Trabzon area -- the area in which Kaptan allegedly benefited from the provision of land for LTAR. In addition, Kaptan said the use of a benchmark involving properties in the municipality of Cerkezkoy is faulty, since they appear to be in a Turkish Organized Industrial Zone, making their rents "inadmissible as benchmarks," since these zones are government entities.