Chinese Paper Plate Exporter Opposes Total AFA for Reporting Issue It Wasn't Notified About
Exporter Fuzhou Hengli Paper Co. is contesting a number of decisions the Commerce Department made during an antidumping duty investigation on paper plates from China, including the agency's surrogate selection, its finding of critical circumstances, its valuation of Fuzhou Hengli’s factors of production and its assignment of total adverse facts available to the exporter in (Fuzhou Hengli Paper Co. v. U.S., CIT # 25-00064).
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In the April 7 complaint at the Court of International Trade, Fuzhou Hengli said it initially received a zero percent dumping margin in Commerce’s preliminary determination. Because of that, the department also determined that no critical circumstances existed with regard to the exporter.
In its initial questionnaire response to a question about its valuation of production factors, the exporter said it explained that it is a trading company, but that one of its unaffiliated producers, Guangdong Ecosource Environmental Technology, reports its material factors of production by kilograms and its unit consumption of production factors by “packages.” But Fuzhou Hengli said it showed that the reporting was ultimately consistent “by allocating quantity of paper input (in kilograms) over the production quantity of all products (in kilograms).”
The petitioner raised concerns “for the first time” at that point that Fuzhou Hengli’s reporting was deficient, the exporter said, so Commerce issued another questionnaire asking for all of Fuzhou Hengli’s consumption usage rates of production factors on a per-kilogram basis. The exporter did so as requested, it said.
“Commerce requested no other changes or [alterations] to Fuzhou Hengli’s FOP reporting methodology,” it said. “Specifically, Commerce did not include any notification that Fuzhou Hengli’s allocation methodology was otherwise deficient.”
Fuzhou Hengli received a zero percent rate after that in the department’s preliminary determination.
But during verification, Commerce called into question Fuzhou Hengli’s reported consumption rates of a paper plate input, folding box board, “because the rates were not specific to the different weights of [folding box board] used for production of differing products,” the exporter said.
Fuzhou Hengli argued in rebuttal that Commerce’s practice in previous cases had been to allocate “total consumption of a [factor of production] across total production output to calculate per-unit consumption.” It also said the department had known this was how it was reporting its production factor consumption rates and hadn’t notified it of any deficiency. And it said it hadn’t failed to cooperate to the “best of its ability,” as required by statute.
Regardless, the department applied total AFA “on the basis that it ‘withheld information that was requested’ because it did not report consumption of its paper input [factor of production] on a per-CONNUM basis,” the exporter said.
Because of this, Commerce also refused to consider Fuzhou’s arguments regarding the surrogate used to value its paperboard input, and it reversed its negative critical circumstances finding regarding the exporter, it said.