Vietnamese Electric Wire Exporter Couldn't Show Products' Inputs Came From China, US Says
Adverse facts available were warranted for a Vietnamese electric wire exporter’s reporting of its inputs’ countries of origin, the U.S. said Sept. 8 in response to an exporter’s motion for judgment opposing a circumvention ruling (Tanghenam Electric Wire & Cable Co. v. United States, CIT # 25-00049).
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Tanghenam Electric Wire & Cable claimed in its July motion that it was hit with AFA for its choice to manually track its inputs' origins based on “transaction documents which recorded the supplier’s address” (see 2507240001). But there was nothing missing or incorrect on the record for AFA to fill, it argued. It also claimed that, because it applied AFA, the department wrongly barred it from a regime by which it could have certified its products’ inputs were of third-country origin.
The government told a different story. It said that, during verification, Commerce conducted a spot-check of certain imported inputs that found some that had been reported as originating elsewhere had actually been made in China. The spot-check occurred after Tanghenam had already submitted minor corrections, it said.
“Commerce found that these discrepancies were systemic, because Tanghenam reported the supplier’s address as the source country, rather than the country where that input was actually produced,” it said.
It also said that the information should have been provided accurately “well before verification.” It was only at verification that the exporter gave Commerce “ledgers with a column labeled ‘origin,’” the U.S. said.
It also said that receiving AFA wasn’t the reason Tanghenam had been barred from the circumvention inquiry’s certification regime. The exporter was barred because it didn’t have a way of tracing its inputs through processing into finished exports, meaning it couldn’t certify that the exports didn’t include Chinese inputs. It said Tanghenam was “conflat[ing]” this tracing capacity with the ability the exporter did have to trace its inputs’ countries of origin prior to processing.
And it said it “was unclear how Tanghenam would benefit even if Commerce had not applied AFA.” Regardless of the inference, Commerce had determined “a significant portion” of Tanghenam's products’ value was attributable to Chinese inputs, it said.
The exporter appeared to be trying to reverse the use of AFA so that it could participate in the certification regime, the government said. But, again, the exporter wasn’t allowed to certify for other reasons, not because it received AFA, it said.