Ad Hoc Shrimp Trade Action Comm. v. United States

• Decision Date: 21 January 2016
• Docket Number: Slip Op. 16–7,Court No. 13-00346
• Parties: Ad Hoc Shrimp Trade Action Committee, Plaintiff, v. United States, Defendant.
• Court: U.S. Court of International Trade

145 F.Supp.3d 1349

Ad Hoc Shrimp Trade Action Committee, Plaintiff,

v.United States, Defendant.

Slip Op. 16–7

Court No. 13-00346

United States Court of International Trade.

Dated: January 21, 2016

Andrew W. Kentz, Jordan C. Kahn, and Roop K. Bhatti, Picard Kentz & Rowe LLP, of Washington, DC, for the Plaintiff.

Joshua E. Kurland, Trial Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice, of Washington, DC, for the Defendant. Also on the brief were Benjamin C. Mizer, Principal Deputy Assistant Attorney General, Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director. Of counsel on the brief was Melissa M. Brewer, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, DC.

OPINION

Pogue

, Senior Judge:

This action arises from the seventh administrative review by the U.S. Department of Commerce (“Commerce”) of the antidumping duty order (“the order”) on certain frozen warmwater shrimp from the People's Republic of China (“PRC” or “China”).¹ In this seventh review, Commerce determined to revoke the order with respect to respondent Zhanjiang Regal Integrated Marine Resources Company, Limited (“Regal”).²

Adjudicating appeals from Plaintiff Ad Hoc Shrimp Trade Action Committee (“AHSTAC”)—an association of domestic warmwater shrimp producers that participated in this seventh review³ —this Court remanded Commerce's determination to revoke the order as to Regal, ordering the agency to reconsider certain surrogate value data used to determine Regal's normal value.⁴ The agency's Remand Results are now before the court.⁵

The parties now raise two issues. First, Commerce protests an aspect of the court's holding in ordering remand in AHSTAC I

.⁶ Second, AHSTAC challenges Commerce's selection, in the Remand Results , of a certain surrogate value for one of the factors of production used to construct Regal's normal value.⁷

The court has jurisdiction pursuant to Section 516A(a)(2)(B)(iii) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2012)

,⁸ and 28 U.S.C. § 1581(c) (2012).

As explained below, Commerce's redeterminations on remand are supported by a reasonable reading of the record evidence, and are therefore sustained.

BACKGROUND

Antidumping duty orders are imposed on imported merchandise that is sold at prices below normal value (i.e., “dumped”).⁹ “[N]ormal value” is usually the price at which a foreign producer's like products are sold in the exporting country or, for merchandise originating in non-market economies (“NMEs”), a value calculated using appropriate surrogate market economy data.¹⁰ Such orders are regularly administratively reviewed by Commerce, such that the agency determines producer/exporter-specific dumping margins, covering discrete (typically one-year) time periods, by making contemporaneous normal value to export price comparisons.¹¹ Pursuant to a regulation in effect at the time of the administrative review at issue here, Commerce was authorized to revoke the order with respect to particular exporters/producers if Commerce found, inter alia, that such an exporter/producer had not “sold the merchandise at ... less than normal value for a period of at least three consecutive years.”¹² Here, Regal requested company-specific revocation pursuant to this regulation.¹³

By the time of Commerce's decision regarding Regal's request, Regal had been individually examined in the sixth and seventh reviews, and received zero percent dumping margins in both proceedings.¹⁴ Regal was not, however, individually examined in the fifth review;¹⁵ rather, it was assigned a zero percent dumping margin based on its individually-calculated zero percent rate in the previous (fourth) review.¹⁶ Because Regal was not individually examined in the fifth review, Commerce, in the seventh review, requested from Regal information and sales data from the time period covered by that fifth review,¹⁷ “to confirm that Regal did not dump [subject merchandise] during that time,”¹⁸ and hence to confirm that Regal did not dump for three consecutive years, as required for revocation eligibility under the regulation.¹⁹

Because Commerce considers China to be a non-market economy, the agency generally calculates normal value for China-originating merchandise using “the value of the factors of production utilized in producing the merchandise,” including “an amount for general expenses and profit plus the cost of containers, coverings, and other expenses” (collectively, the “FOPs”), from a surrogate market economy country.²⁰

As this Court explained in AHSTAC I:

Because Commerce's selection of an appropriate surrogate market economy must be such that the chosen dataset provides the best available information for approximating the NME producers' experience, Commerce chooses a primary surrogate country that is economically comparable to the NME country (measured in terms of the countries' comparative per capita gross national income (‘GNI’)), is a significant producer of comparable merchandise, and provides publicly-available, reliable, and relevant data.²¹

Commerce originally chose India as the appropriate surrogate market economy country for China during the period covered by the fifth review.²² Although AHSTAC successfully challenged that choice of surrogate for the fifth review,²³ the issue was subsequently rendered moot and accordingly was ultimately not revisited in that proceeding.²⁴ And when, in the context of Regal's seventh review revocation request, Commerce analyzed whether Regal sold subject merchandise at less than normal value during the fifth review period, Commerce again—despite the Court's decision in China Shrimp AR5

—used India as the surrogate country for its analysis of Regal's fifth review data.²⁵

However, as this Court also explained in AHSTAC I

:

In China Shrimp AR5

, this Court held that Commerce acted arbitrarily in the

fifth review by disregarding the concern that India's per capita GNI was nearly a third of China's during the relevant time period, whereas Thailand's per capita GNI was nearly identical thereto, despite the record evidence that the quality of the available datasets from these two potential surrogates was nearly indistinguishable.... Disregarding the court's holding in China Shrimp AR5

, Commerce did not consider or weigh the effect of the significant divergence between India and Thailand's respective economic comparability to China when determining, based on reasoning reiterated from the fifth review, that while the record provided adequate surrogate FOP datasets from both potential surrogates, the Indian dataset provided the best available information.²⁶

The court therefore remanded Commerce's seventh review analysis of Regal's fifth review period sales. By continuing to use Indian surrogate data to arrive at the comparison normal values for that period, based on reasoning reiterated from the original fifth review:

[Commerce] ignore[d] this Court's repeated holdings that where, as here, adequate data is available from more than one country that is both at a level of economic development comparable to the NME and a significant producer of comparable merchandise, Commerce must weigh the relative merits of such potential surrogates' datasets in a way that does not arbitrarily discount the accuracy-enhancing value of sourcing surrogate data from a market economy whose economic development is as close as possible to that of the NME, and in that regard may provide the best available information.²⁷

On remand here, Commerce reconsidered its surrogate country choice for the fifth review period, and “determined to select Thailand as the primary surrogate country [in light of] the proximity of Thailand's per capita GNI to the PRC's GNI and because the Thai surrogate value ... data used to value Regal's [FOPs] is superior.”²⁸ With respect to one of the inputs, however—shrimp feed—the agency found that the Thai values were aberrational, and therefore unreliable, and accordingly determined to use alternative data from a secondary surrogate country—Indonesia.²⁹ AHSTAC now challenges this latter determination.³⁰

Because Commerce protests AHSTAC I

,³¹ the court will first review its prior holding.³² Accordingly, following a brief statement of the relevant standard of review, this opinion will discuss AHSTAC I in light of the Remand Results. The court will then address AHSTAC's challenge to the Remand Results.

STANDARD OF REVIEW

The court upholds Commerce's antidumping determinations on remand if they are in accordance with law, consistent with the court's remand order, and supported by substantial evidence.³³ Substantial evidence is “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion,”³⁴ and the substantial evidence standard of review “can be translated roughly to mean ‘is [the determination] unreasonable?’ ”³⁵

DISCUSSION

I. AHSTAC I and the Remand Results

In making its protest, Commerce mischaracterizes the court's holding in AHSTAC I

. According to Commerce, AHSTAC I requires the agency, in all instances, to “consider the relative GNI differences of potential surrogate countries that [Commerce] considers to be at the same level of economic comparability.”³⁶ Instead what the court held in AHSTAC I is that, on the particular record presented here—i.e., where both India and Thailand satisfied the statutory criteria of economic comparability to the PRC and significant production of comparable merchandise, and where the quality and specificity of the respective Indian and Thai potential surrogate datasets were materially indistinguishable—Commerce unreasonably concluded that relative per capita GNI proximity to the PRC was entirely irrelevant when choosing between these otherwise indistinguishable datasets.³⁷

As the court explained in AHSTAC I

, Commerce's conclusion “that significant ‘differences of quality of data sources' adequately support the agency's selection...