Paper Producers Again Say Unpaid AD Interest Not a Production Cost
Domestic thermal paper producers on Sept. 29 opposed the Commerce Department’s continued inclusion, after a remand, of interest accrued on unpaid antidumping duties in its calculation of German exporter Koehler Paper’s normal value for an AD investigation (Matra Americas v. United States, CIT # 21-00632).
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In its Sept. 4 remand determination, the department also applied a new “price difference test” to the exporter in place of the Cohen’s d test, which the U.S. Court of Appeals for the Federal Circuit limited in April (see 2504220030). The producers didn’t mention the new test in their brief.
Instead, they focused on the department’s insistence on deducting the interest on Koehler’s unpaid duties from the exporter’s production costs.
As they have in the past (see 2502060073), they said that Koehler’s interest liabilities “entirely” relate to the exporter’s selling activities in the United States. The liabilities arose as a result of Koehler exporting its paper to the U.S., then refusing to pay AD on it, they said, locating them on the “price” side of the balance sheet.
And they argued it didn’t matter that Koehler owed duties on a prior, since-revoked AD order on its products, they said. The test is whether costs being contested are related to the “selling of subject merchandise,” they said, and “subject merchandise” means “the class or kind of merchandise that is within the scope of an investigation.”
Both the recent AD order, published in 2021, and the old one, published in 2008, cover the same “class or kind” of merchandise, they said. As a result, merchandise sold under the 2008 order, whether or not duties were actually paid, also would be subject merchandise under the 2021 one, they said.
They claimed that the interest debts were indirect selling expenses, saying that “indirect expenses are fixed expenses that are incurred whether or not a sale is made.” That was true of Koehler’s outstanding debts, they said.
They also noted that the issue is “essentially the same” as one appearing in a more recent case challenging the results of the first administrative review of the AD order on German paper (see 2504020075). As a result, the Court of International Trade should remand those results, too, if it agrees with them, they said.