==========================================================
NEW
APPROACH BY THE
IN
THE METHODOLOGY OF CALCULATION OF DUMPING MARGINS AFTER THE ANTIDUMPING
INVESTIGATION
OF
FROZEN FISH FILLETS IMPORTED FROM
Le Cong Dinh
Partner,
YKVN
==========================================================
In
antidumping investigations involving NME countries, DOC’s long-standing policy
was to calculate each respondent’s production cost (i.e., normal value) using
its actual materials, labor and energy inputs (i.e., factors of
production) consumed to produce the merchandise under investigation in order to
determine the existence and extent of dumping.
The
DOC’s
Practice Before the Catfish Case
In
NME cases, DOC applied surrogate values collected from a market economy country
(i.e., the surrogate country) to the reported factors of production to
determine the normal value of subject merchandise. The antidumping statute
provides that DOC must construct the value of subject merchandise manufactured
by a NME producer using the factors of production actually utilized by that
producer. DOC antidumping regulations
further state that “[i]n identifying dumping
from a non-market economy country, the Secretary normally will calculate normal
value by valuing the non-market economy producers’ factors of production in a
market economy country” (19 C.F.R. § 351.408(a)).
In
all past NME cases involving agricultural products, DOC always had used
respondents’ actual factors of production to calculate their dumping margins
because these factors reflect each respondent’s production experience more
accurately. For example, in Fresh
Garlic from China, DOC used the factors of production involving both the
garlic growing stage and the garlic processing stage to calculate a
respondent’s normal value because they reflect that respondent’s integrated
production process. Similarly, DOC in Preserved
Mushrooms from China used the factors of production involving both the
mushrooms growing and processing stages to calculate the respondents’ normal
values because the respondents reported both the growing and the processing
stages.
DOC’s Determination in the Catfish Case
In
the preliminary determination announced in January 2003 in the Catfish Case,
DOC however departed from its long-established practice. The Vietnamese
companies under investigation had an integrated production process. That is, they did not purchase live fish from
outside farmers. Instead, they had
nurseries where fish were spawned and raised to fingerling size. They had cages and ponds where the
fingerlings grew into food-sized fish and eventually harvested. They had plants
where the fish were processed into frozen fish fillets and exported to the
DOC
rejected the detailed information submitted by Vietnamese respondents on their
spawning, raising and harvesting of fish, because a number of “critical
questions” regarding the reported data, such as the seasonality of the
production of fish,
the narrowness of the six-month period of investigation in relation to the
growth cycle of the fish,
and the possible impact of the yield ratios at various stages of production had
not been responded. Instead DOC presumed that the Vietnamese respondents
purchased fish on the open market from independent suppliers and used this
open-market value (from
However, DOC firmly promised
to “make every attempt to clarify the factors data for the fish farming stage
of production that respondents have reported;” and if the questions raised can be addressed, DOC would “intend to revert to
[its] standard methodology and use the factor information for the various stages.”
After
the preliminary determination was issued, DOC confirmed the accuracy of
respondents’ data through thorough and exhaustive on-site verification in the
Mekong Delta. During a two week
intensive on-site inspection in late March 2003, a team of eight DOC officials
and interpreters personally inspected the nurseries, farms and cages where the
four major Vietnamese exporters spawned, raised and harvested the fish all
along the
DOC
should have followed precedent and calculated the respondents’ dumping margins,
if any, using their actual factors of production in the final determination be
issued on
The
After
the Catfish Case, the Vietnamese fish exporting producers appealed to the U.S.
Court of International Trade (ITC)
requiring a review of DOC’s methodology used in its calculation of dumping margins. They argued that the methodology employed by
DOC to calculate normal value was inconsistent with its practice, was not
supported by substantial evidence, was otherwise not in accordance with law,
including Section 773(c) of the Tariff Act (19 U.S.C. § 1677b(c)), and was
contrary to its established practice in NME proceedings. In the past CIT usually found a determination
unlawful where DOC failed to carry out its duties properly, relied on
inadequate facts or reasoning, or failed to provide an adequate basis for its
conclusions.
Before
the CIT appeal by the Vietnamese companies of DOC’s final determination, CIT
issued an order remanding to DOC its final determination in a Chinese steel
case (the
Based
upon this favorable decision on the first round of the Anshan case and
the legal principles underlying that case, the Vietnamese exporters believed
that if CIT ultimately rejected any explanation provided by DOC in the remand
redetermination ordered for the Anshan case and forced DOC to assign
surrogate values to self-produced factors, then the dumping margins in the
Catfish Case would also be subject to remand for redetermination in favor of
the Vietnamese companies.
DOC’S NEW APPROACH IN ANTIDUMPING
INVESTIGATIONS INVOLVING NME COUNTRIES
On
the second round of the
Upon
DOC’s above explanation, CIT in its second
A
negative result for the Vietnamese fish exporting producers was clearly
foreseeable. They finally decided not to
continue their CIT appeal. In addition,
a favorable growth in global demand for catfish after this famous lawsuit
shifted their focus from the
- Printer-friendly version
- Login to post comments
