Creswell Trading Co., Inc. v. US

• Decision Date: 28 August 1992
• Docket Number: Court No. 91-01-00012.
• Citation: 797 F. Supp. 1038
• Parties: CRESWELL TRADING COMPANY, INC., South Bay Foundry 1989, D & L Supply Co., Southern Star, Inc., City Pipe & Foundry, Inc., Capitol Foundry of Virginia, Inc., Virginia Precast Corp. and Techsales, Inc., Plaintiffs, Crescent Foundry Co. P. Ltd., et al., Plaintiffs-Intervenors, v. UNITED STATES, Defendant, Allegheny Foundry Co., et al., Defendants-Intervenors.
• Court: U.S. Court of International Trade

797 F. Supp. 1038

CRESWELL TRADING COMPANY, INC., South Bay Foundry 1989, D & L Supply Co., Southern Star, Inc., City Pipe & Foundry, Inc., Capitol Foundry of Virginia, Inc., Virginia Precast Corp. and Techsales, Inc., Plaintiffs Crescent Foundry Co. P. Ltd., et al., Plaintiffs-Intervenors, v. UNITED STATES, Defendant Allegheny Foundry Co., et al., Defendants-Intervenors.

Court No. 91-01-00012.

United States Court of International Trade.

August 28, 1992.

Brownstein Zeidman & Lore, Irwin P. Altschuler, Ronald M. Wisla, and Willkie Farr & Gallagher, Christopher Dunn, Walter J. Spak, Vincent Bowen, Washington, D.C., for plaintiffs.

Whitman & Ransom, Dennis James, Jr., Washington, D.C., for plaintiffs-intervenors.

Stuart M. Gerson, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Civil Div., U.S. Dept. of Justice, Velta A. Melnbrencis, Washington, D.C., and (Robert E. Nielsen, Office of Chief Counsel for Import Admin., U.S. Dept. of Commerce, of counsel), for defendant.

Collier, Shannon, Rill & Scott, Paul C. Rosenthal, Robin H. Gilbert, Washington, D.C., for defendants-intervenors.

MEMORANDUM OPINION

DiCARLO, Chief Judge:

Plaintiffs, importers of iron-metal castings from India, move for second remand contesting the Department of Commerce's remand determination countervailing the entire subsidy provided by the Indian government to iron-metal castings exporters under India's International Price Reimbursement Scheme (IPRS). Certain Iron-Metal Castings From India, (Dep't Comm. March 16, 1992) (remand determination). This court has jurisdiction pursuant to 28 U.S.C. § 1581(c) (1988) and 19 U.S.C. § 1516a(a)(2)(B)(iii) (1988).

The court previously remanded the result of the 1985 countervailing duty administrative review of certain iron-metal castings from India and ordered Commerce to examine the IPRS program in light of item (d) of the Illustrative List of Export Subsidies (List), Annex A to the Agreement on Interpretation and Application of Articles VI, XVI and XXIII of the General Agreement on Tariffs and Trade. Creswell Trading Co., Inc. v. United States, 16 CIT ___, 783 F.Supp. 1418 (1992). Under the exception of item (d), provision of goods by governments is not countervailable if the terms of such provision are not more favorable than those "commercially available on world markets to their exporters."

In its draft remand determination, Commerce applied the exception under item (d) and examined whether the IPRS payments exceeded the difference between the claimed world-market prices and the Indian domestic prices of pig iron. Commerce calculated the excess subsidy and recalculated the countervailing duty rates, which were lower than in the original review determination. Commerce, however, reversed its position in its final remand determination and decided to countervail the entire amount of the IPRS payments. Commerce determined that no portion of the IPRS payments can be justified under the exception of item (d) because it found that the record does not substantiate a world-market price for pig iron. The court affirms Commerce's conclusion that plaintiffs failed to carry out their burden of proving world-market prices.

At issue is whether it was reasonable for Commerce to determine plaintiffs failed to meet their burden in establishing the terms and conditions that are commercially available on world markets of pig iron to claim that the IPRS payments are not countervailable under the exception of item (d). Although the parties agreed during the oral argument that item (d) does not require a quotable world-market price, they stipulated for the purpose of this proceeding that the phrase "world-market price" refers to the terms or conditions that are commercially available on world markets for the IPRS payments to be non-countervailable under the exception.

Plaintiffs contend that they do not have the burden of establishing the world-market prices which were prevalent at the time, but the provision only requires them to establish a price that was available to Indian exporters on world markets. They argue that the record is sufficient to establish a world-market price because it can be proved that the IPRS payments did not provide pig iron to Indian casting exporters at the terms more favorable than those available to Indian exporters on world markets.

Item (d) of the List provides:

(d) The delivery by governments or their agencies of imported or domestic products or services for use in the production of exported goods, on terms or conditions more favourable than for delivery of like or directly competitive products or services for use on sic the production of goods for domestic consumption, if (in the case of products) such terms or conditions are more favourable than those commercially available on world markets to its sic exporters.

H.R.Doc. No. 153, Pt. I, 96th Cong., 1st Sess. 295 (1979) (emphasis added). To qualify for the item (d) exception, it has been Commerce's practice to require a rebate system which assures that the subsidy when granted would not be more favorable than the terms on world markets rather than a system which later might turn out to be non-countervailable. See...