Asahi Chemical Industry Co., Ltd. v. US, Court No. 80-5-00755-S.
| Citation | 692 F. Supp. 1376,12 CIT 690 |
| Decision Date | 25 July 1988 |
| Docket Number | Court No. 80-5-00755-S. |
| Parties | ASAHI CHEMICAL INDUSTRY CO., LTD., Plaintiff, v. UNITED STATES, Defendant, American Yarn Spinners Association, Party-in-Interest. |
| Court | U.S. Court of International Trade |
Barnes, Richardson & Colburn (Edwin F. Rains, James S. O'Kelly, Washington, D.C., and Richard Haroian, on the briefs) for plaintiff.
John R. Bolton, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Washington, D.C., (Velta A. Melnbrencis, New York City, on the briefs) for defendant.
Leva, Hawes, Symington, Martin & Oppenheimer (Joseph H. Price and Simeon M. Kriesberg, Washington, D.C., on the briefs) for party-in-interest.
This case concerns spun acrylic yarn from Japan that was the subject of a petition filed by the Party-in-Interest, American Yarn Spinners Association (AYSA) with the Treasury Department on November 22, 1978. The petition alleged that spun acrylic yarn from Japan was or was likely to be sold at less than fair value (LTFV) within the meaning of the Antidumping Act of 1921, as amended. The Treasury Department (Treasury) determined that the petition was in proper form and, on January 4, 1979, initiated an antidumping investigation by publishing an Antidumping Proceeding Notice with regard to spun acrylic yarn from Japan in the Federal Register. 44 Fed.Reg. 1238-9. Subsequently, Treasury determined that there were reasonable grounds to believe or suspect that there were or were likely to be sales of spun acrylic yarn from Japan at LTFV and published a Withholding of Appraisement Notice on July 13, 1979. 44 Fed.Reg. 41004-5.
On October 25, 1979 Treasury published a notice of its Determination of Sales at Less than Fair Value with regard to spun acrylic yarn from Japan. 44 Fed.Reg. 61492-3. Plaintiff was one of three companies whose sales were examined during the investigation leading to this determination. On November 19, 1979 the United States International Trade Commission (ITC), having received advice from Treasury that spun acrylic yarn from Japan was or was likely to be sold at LTFV, instituted its investigation under 19 U.S.C. § 160(a) to determine whether an industry in the United States was being, or was likely to be, injured or prevented from being established by reason of such merchandise being imported into the United States.
The Trade Agreements Act of 1979 became effective on January 1, 1980. Pursuant to section 102(c) of that Act, the ITC was required to terminate its pending investigation of spun acrylic yarn from Japan and to initiate a new investigation under section 735 of the Tariff Act, 19 U.S.C. § 1673d, treating Treasury's LTFV determination as final. Accordingly, on January 17, 1980, the ITC published a notice terminating its pending investigation and instituting a new injury investigation.
AYSA has also filed a petition alleging that spun acrylic yarn from Italy was being sold at less than fair value, and this petition was processed in a manner similar to that the subject of this action.
On March 26, 1980, the ITC published its determination of material injury to an industry in the United States with regard to spun acrylic yarn from Japan and Italy. 45 Fed.Reg. 1968287.
Plaintiff challenges both the less than fair value determination of Treasury and the material injury determination of the ITC. It is plaintiff's position that the Treasury determination of sales at less than fair value was in error because Treasury failed to make appropriate adjustments to foreign market value and because Treasury excluded 47 per cent of plaintiff's sales as being below the cost of production. Plaintiff challenges the ITC finding of material injury to an industry in the United States because it alleges that there was insufficient evidence that the volume and impact of sales of the merchandise from Japan affected domestic lost sales, price suppression, plant closings and domestic employment.
Defendant and AYSA both challenge plaintiff's standing to seek review of the decision to impose dumping duties made by Treasury under the Antidumping Act of 1921. It is their position that since Treasury's final LTFV determination was published on October 25, 1979, before the date on which the Trade Agreements Act of 1979 became effective, there are only three classes of persons to whom Congress had granted standing to challenge such a determination —(1) American manufacturers and wholesalers, (2) importers, and (3) consignees of the subject merchandise and that plaintiff, a foreign manufacturer, does not come within these classes of persons. Under the Antidumping Act of 1921 foreign manufacturers and exporters were not accorded the right to seek review of a dumping determination by the Treasury Department.
It is plaintiff's position that it is not challenging the determination of Treasury of sales at LTFV under the Antidumping Act of 1921, but the decision of the Department of Commerce to impose dumping duties, which was made under the Trade Agreements Act of 1979. The Court agrees with this position.
Dumping duties are only assessed after there has been a finding of material injury or likelihood of material injury to an American industry, which occurs after the finding of sales at LTFV. Although a foreign manufacturer or importer may be very alarmed at having a LTFV determination made against it, it may still hope that the ITC investigation would show that no American industry is or is likely to be injured by its sales. In such a case, no action would be required because no legal detriment would have been suffered since no dumping duties would be imposed. It is only after the dumping duties are to be assessed that the foreign manufacturer has been injured.
In section 102(c)(2) of Title 1 of the Trade Agreements Act of 1979, 93 Stat. 144, 189-190, Congress provided that, on the effective date of Title VII of the Tariff Act of 1930, any final determination of the Secretary of the Treasury under the Antidumping Act of 1921 was to be treated as a final determination under section 735(a) of the Tariff Act of 1930 (the "new law"). It is beyond question that determinations under section 735(a) are reviewable by this Court when an action is commenced by a foreign manufacturer. See 19 U.S.C. § 1516a(a)(2)(B); Royal Business Machines, Inc. et al. v. United States, 1 CIT 80, 507 F.Supp. 1007, aff'd 69 CCPA 61, 669 F.2d 691 (1982).
We will consider plaintiff's claims as to Treasury's finding of sales at less than fair value first. The LTFV investigation was conducted under the provisions of the Antidumping Act of 1921, as amended ("the Act"). Although the investigation originally was to cover the period of January 1 to June 30, 1978, it was extended to cover January 1 to December 31, 1978 because of fluctuations in the amount of imports during that year. Plaintiff, as well as other Japanese manufacturers of spun acrylic yarn, was notified of the investigation and was requested to present documentation of its pricing structure at a meeting to be held with the U.S. Customs Representative to Japan at the Japanese Ministry for International Trade and Industry (MITI). Plaintiff was furnished with a copy of the questionnaire prepared by Treasury with respect to spun acrylic yarn and was advised that assistance would be provided in answering the questions posed.
Asahi provided the information requested, both for the original period of investigation and for the extended period and, at the meeting at MITI, Asahi presented its records for inspection by the Special Customs Representative. It also submitted written responses to the questionnaire, and submitted additional responses on written request from Treasury. At the meeting, the Special Customs Representative verified Asahi's responses to the questionnaire by checking invoices and sales agreements with both domestic and U.S. customers.
In arriving at the LTFV determination, Treasury compared the home market price with the price for export to the United States. Treasury concluded that approximately 47 per cent of the home market sales should be disregarded as being below the cost of production. In arriving at the below cost of production sales, Treasury disallowed certain items of cost, i.e., advertising costs, warehousing costs and interest costs, relying on Customs Regulations then in effect. Section 153.10(a) of the Customs Regulations provided:
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