Commerce Showed Its Work in Finding Exporter Free of Foreign Gov't Control, CIT Says
The Commerce Department showed its work in finding that exporter East Sea Seafoods is independent of the Vietnamese government and thus eligible for a separate rate under an antidumping duty order on Vietnamese catfish in the 2019-20 administrative review of the AD order, the Court of International Trade held on July 10. Judge M. Miller Baker also held that Commerce properly assigned exporter Green Farms Seafood Joint Stock Company an AD rate taken from a simple average of respondent NTSF Seafood's zero percent rate and East Sea's adverse facts available rate.
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The court previously remanded the review with instructions to Commerce to discuss the criteria regarding whether East Sea was de jure and de facto independent of Vietnamese government control (see 2404180031).
Regarding the de jure criteria, East Sea said it wasn't required to obtain any license "beyond a valid Vietnamese business registration certificate and certificate of tax registration and that the government does not restrict the company’s use of export revenues." The exporter also "certified that its exports are unregulated" and reported that its goods aren't subject to export quotas or otherwise bound by Vietnamese government control.
Regarding the de facto criteria, East Sea certified that it "negotiates prices directly with customers" and that it has independence to "negotiate and sign export contracts and other agreements." The company added that its ownership hadn't changed since it last asked for a separate rate and that its largest shareholders had no "significant connections with the Vietnamese government."
Commerce said these factors support a finding of East Sea's independence. Green Farms challenged the finding, though Baker said the company failed to challenge the finding "under the relevant de jure and de facto criteria." While Green Farms said Commerce failed to address "several other evidentiary shortcomings," the court said it already rejected those arguments, reminding Green Farms that the scope of remand was narrow.
Baker then considered whether a simple average of a zero and an AFA rate reflected Green Farms' "economic reality" for purposes of setting the company's separate rate. In reviewing this question, Commerce looked at Green Farms' pricing, comparing the sales price in the company's separate rate application with prices reported by NTSF and East Sea.
Commerce adjusted Green Farms' pricing to account for the fact that it used "different sales terms" than the other two companies, ultimately finding that the adjusted prices fell "well below NTSF's" and "comparatively close" to East Sea's. The agency said the fact that Green Farms' prices fell in between NTSF's and Sea Food's makes the simple average "reasonably reflective of" Green Farms' "commercial behavior."
Green Farms argued that Commerce failed to justify how the "harshly punitive AFA rate" actually "reflects economic reality," adding that the agency arbitrarily picked and adjusted individual prices taken from sample sales documents. While the exporter said the adjustments were "mere estimates" and not precise, Baker said the company "cites nothing in the record to support that assertion, and the court’s search came up empty."
The exporter also challenged Commerce's conclusion on the basis that its pricing comparison was "meaningless," since it "does not measure dumping." Baker held that Green Farms is "unable to identify any record evidence" to back this claim, noting that the company failed to address the evidence Commerce cited showing the company's pricing was "comparatively close" to East Sea's prices.
Lastly, Green Farms argued that Commerce should have used the average of the most recently calculated dumping margins in recent reviews that aren't zero, de minimis or based on facts available instead of taking a simple average of the rates for NTSF and East Sea. However, Baker held that the authorities the exporter cites don't "establish the existence of any such 'practice'" of doing just that.
The cases the company cites merely show Commerce "previously acknowledged the undisputed proposition that looking to margins established in previous reviews" is “a ‘reasonable method’ to use” when all the mandatory respondents' rates are de minimis, zero or based on an adverse inference. So, those cases don't “establish the existence of any agency practice of looking to prior reviews.” In fact, the agency cited two recent occasions where it used the simple average of respondents' zero, de minimis or AFA rates to calculate rates for non-investigated entities, "as it did here," the court noted.
(Green Farms Seafood Joint Stock Company v. United States, Slip Op. 25-89, CIT # 22-00092, dated 07/10/25; Judge: M. Miller Baker; Attorneys: Robert LaFrankie of Crowell & Moring for plaintiff Green Farms Seafood Joint Stock Company; Yaakov Roth for defendant U.S. government; Nazak Nikakhtar of Wiley Rein for defendant-intervenors Catfish Farmers of America and eight of its individual members)