US Fights Consideration of Cross-Owned Input Supplier Analysis in Rebar CVD Case at CIT
The Commerce Department's remand results in a countervailing duty case brought by Nucor Corp. should not be considered in a separate CVD case led by Kaptan Demir Celik Endustrisi ve Ticaret, the U.S. argued in a Feb. 8 reply brief at the Court of International Trade. For starters, the remand results -- which saw Commerce decide not to treat a CVD respondent's supplier as a cross-owned input supplier -- have not been sustained, but even if they were, the trade court is not bound by judgments of other CIT judges, the government said. Also, the analysis in the Nucor case deals with particular companies and is specific to that case (Kaptan Demir Celik Endustrisi ve Ticaret v. U.S., CIT # 21-00565).
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Kaptan's case concerns the countervailing duty review on steel concrete reinforcing bar from Turkey covering entries in 2018. In the review, Kaptan listed Nur Gemicilik ve Tic as one of its affiliates since the ship building company sold scrap to Kaptan, though the respondent said that Nur could not qualify as a cross-owned input supplier because the amount was "extremely minuscule" compared with the amount bought from other suppliers (see 2110200026). Kaptan said the issue boiled down to figuring out if an input is "primarily dedicated" to the downstream product.
In its brief, the government said that the term "primarily dedicated" can be looked at in two different ways: either the input is generally primarily dedicated to subject merchandise or a specific company's input production is almost exclusively dedicated to the respondent's production. The U.S. claimed that regardless of the nature of the input supplier's overall business activity or the amount sold to the respondent, as long as almost all of the input maker's input is sold to the respondent, then it is "primarily dedicated" to the respondent's production.
But in Nucor, Commerce, on remand, stuck by its decision not to attribute to respondent POSCO subsidies that were received by its affiliate POSCO Plantec related to the provision of steel scrap (see 2302010042). Commerce held that Plantec's primary function was the construction of industrial plants and not a downstream product, meaning the agency could not attribute subsidies related to the sale of scrap to POSCO. Kaptan filed a notice of supplemental authority citing the Nucor remand results (see 2302020057), arguing that they are at odds with the agency's analysis in the present case.
Replying to the notice, the U.S. said the Nucor case should not be considered since Commerce's analysis is conducted on a case-by-case basis and "each decision is highly record-dependent." The Nucor case is "in many ways different from the facts before the Court here," the government said. "... Commerce is not required to have relied on an identical analysis in the underlying determination for the Court to find the decision was supported by substantial evidence. Here, Commerce articulated a reasoned explanation for its decision and rationally explained the connection between the record facts and its decision in the underlying determination."