Slip Op. 00-43

UNITED STATES COURT OF INTERNATIONAL TRADE

BEFORE: RICHARD W. GOLDBERG, JUDGE

COALITION FOR FAIR ATLANTIC

SALMON TRADE,

 Plaintiff,

 v.

UNITED STATES OF AMERICA,

 Defendant,

 and

ASOCIACIÓN DE PRODUCTORES DE

SALMÓN Y TRUCHA DE CHILE AG, AND

AGUAS CLARAS S.A.,

 

 Defendant-Intervenors.

 

 Court No.98-09-02782

[Defendant’s Final Determination sustained in part and remanded

in part.]

Dated: April 20, 2000

Collier, Shannon, Rill & Scott, PLLC, (Michael J. Coursey,

and David C. Smith, Jr.)for plaintiff Coalition for Fair Atlantic

Salmon Trade.

David W. Ogden, Acting Assistant Attorney General; David M.

Cohen, Director, Commercial Litigation Branch, Civil Division,

United States Department of Justice; Lucius B. Lau, Attorney,

Commercial Litigation Branch, Civil Division, United States

Department of Justice; Office of the Chief Counsel for Import

Administration, United States Department of Commerce (Ann Talbot

and Stacy J. Ettinger), of counsel, for defendant.

Arnold & Porter, (Michael T. Shor and Kevin T. Traskos) for

defendant-intervenors Asociación de Productores de Salmón y

Trucha de Chile AG and Aguas Claras S.A.
Court No. 98-09-02782 Page 2

OPINION

GOLDBERG, Judge: In this action, the Court reviews a challenge

to the Department of Commerce’s (“Commerce”) Notice of Final

Determination of Sales at Less Than Fair Value: Fresh Atlantic

Salmon From Chile, 63 Fed. Reg. 31,411 (June 9, 1998) (“Final

Determination”). 

Plaintiff Coalition for Fair Atlantic Salmon Trade (“FAST”)

argues that Commerce impermissibly departed from its established

practice when it identified Canada, for purposes of calculating

normal value (“NV”), as the third country market for Asociación

de Productores de Salmón y Trucha de Chile AG and Aguas Claras

S.A. (“Aguas Claras”). FAST also argues that Commerce unlawfully

applied a constructed export price (“CEP”) offset to Aguas

Claras’s NV.

The Court exercises jurisdiction over this matter pursuant

to 28 U.S.C. § 1581(c)(1994). The Court sustains the Final

Determination in part and remands in part.

I.

BACKGROUND

On July 2, 1997, at the request of FAST, Commerce initiated

an antidumping duty investigation to determine whether imports of

fresh Atlantic salmon from Chile (“salmon”) were being or were
Court No. 98-09-02782 Page 3

likely to be sold in the United States at less-than-fair-value. 

See Initiation of Antidumping Duty Investigation: Fresh Atlantic

Salmon From Chile, 62 Fed. Reg. 37,027 (July 10, 1997). After

determining that it would be impracticable to examine all Chilean

producers and exporters of salmon, Commerce decided to limit its

investigation to the five largest Chilean exporters. See Notice

of Preliminary Determination of Sales at Less Than Fair Value and

Postponement of Final Determination: Fresh Atlantic Salmon From

Chile, 63 Fed. Reg. 2,664, 2,664-66 (Jan. 16, 1998)(“Preliminary

Determination”). Commerce published its Final Determination on

June 9, 1998. See 63 Fed. Reg. 31,411.

II. 

STANDARD OF REVIEW

The Court will sustain Commerce’s Final Determination if it

is supported by substantial evidence on the record and is

otherwise in accordance with law. See 19 U.S.C. § 1516a(b)(1)(B)

(1994).

To determine whether Commerce’s interpretation of a statute

is in accordance with law, the Court applies the two-prong test

set forth in Chevron U.S.A., Inc. v. Natural Resources Defense

Council, Inc., 467 U.S. 837 (1984). Chevron first directs the

Court to determine “whether Congress has directly spoken to the
Court No. 98-09-02782 Page 4

precise question at issue.” See id. at 842. To do so, the Court

must look to the statute’s text to ascertain “Congress’s purpose

and intent.” Timex V.I., Inc. v. United States, ___ Fed. Cir.

(T) __, __, 157 F.3d 879, 881 (1998) (citing Chevron, 467 U.S. at

842-43 & n.9). If the plain language of the statute is not

dispositive, the Court must then consider the statute’s

structure, canons of statutory interpretation, and legislative

history. See id. at 882 (citing Dunn v. Commodity Futures

Trading Comm’n, 519 U.S. 465, 470-80 (1997)); Chevron 467 U.S.

at 859-63; Oshkosh Truck Corp. v. United States, 123 F.3d 1477,

1481 (Fed. Cir. 1997)). If, after this analysis, Congress’s

intent is unambiguous, the Court must give it effect. See id. 

If the statute is either silent or ambiguous on the question

at issue, however, “the question for the court is whether the

agency’s answer is based on a permissible construction of the

statute.” Chevron, 467 U.S. at 843 (footnote omitted). Thus,

the second prong of the Chevron test directs the Court to

consider the reasonableness of Commerce’s interpretation. See

id.
Court No. 98-09-02782 Page 5

III.

DISCUSSION

The Court first considers FAST’s argument that Commerce’s

determination was not in accordance with law because Commerce

failed to follow agency precedent. The Court rejects this

argument. The Court then considers FAST’s claim that Commerce

unlawfully applied a CEP offset and finds that Commerce’s

application of the CEP offset was not in accordance with law.

A. Flowers Did Not Establish a Prior Norm Commerce Was 

Required to Follow.

Under U.S. antidumping law, Commerce determines dumping

margins by comparing “the weighted average of the normal values

to the weighted average of the export prices (and constructed

export prices) for comparable merchandise.” See 19 U.S.C. §§

1673(1), 1677f-1(d)(A)(i)(1994). Normal value is either the

price at which the subject merchandise is sold in the exporting

country, or under certain market circumstances, the price at

which the merchandise is sold in a representative third-country

market. See 19 U.S.C. § 1677b(a)(1)(B) (1994). In the Final

Determination, Commerce concluded that Aguas Claras’s NV should

be based on its sales of salmon to Canada. See 63 Fed. Reg.

31,419-20. 

The statutory requirements for Commerce’s selection of a
Court No. 98-09-02782 Page 6

third-country NV are that:

(I) Such price is representative,

(II) The aggregate quantity (or, if quantity is not

appropriate, value) of the foreign like product sold

by the exporter or producer in such other country is

5 percent or more of the aggregate quantity (or value)

of the subject merchandise sold in the United States

or for export to the United States, and

(III) The administrating authority does not determine 

that the particular market situation in such other 

country prevents a proper comparison with the export

price or constructed export price. 

19 U.S.C. § 1677b(a)(1)(B)(ii). Commerce found in the Final

Determination that the Canadian market fulfilled these

requirements. See 63 Fed. Reg. at 31,420. 

FAST argues that Commerce improperly selected Canada as

Aguas Claras’s third-country NV market. See Initial Brief of

Plantiff Coalition for Fair Atlantic Salmon Trade in Support of

Rule 56.2 Motion for Judgment on the Agency Record (“FAST’s

Br.”), at 13-23; Reply Brief of Plaintiff, The Coalition for Fair

Atlantic Salmon Trade, in Support of its Rule 56.2 Motion for

Judgment on the Agency Record (“FAST’s Reply Br.”), at 1-13. 

FAST reasons that Commerce was prohibited from selecting Canada

as a third-country market because of a “norm” established by

Certain Fresh Cut Flowers from Colombia: Preliminary Results and

Partial Termination of Antidumping Duty Administrative Review, 63

Fed. Reg. 5,354, 5,357 (Feb. 2, 1998)(“Flowers”).
Court No. 98-09-02782 Page 7

1 In its initial brief, FAST argues that the norm

purportedly established by Flowers must be used to determine if a

market is “important.” See FAST’s Br., at 15-18. In its reply

brief, however, FAST argues that the norm requires the market to

be “representative.” See FAST’s Reply Br., at 1-8.

“Representative” is an existing statutory requirement. See 19

U.S.C. § 1677b(a)(1)(B)(ii)(I). However FAST attempts to argue

the application of Flowers -- either as elucidating the statutory

term “representative” or as adding an extra-statutory requirement

-- FAST’s argument is that Commerce must follow the norm

established by Flowers. 

Specifically, FAST claims Flowers established a norm that

prohibits the selection of a national market for third-country NV

purposes where that market is “unimportant.” See FAST’s Br., at

15-16 (citing Flowers, 63 Fed. Reg. at 5,357). FAST argues that

a market is not “important,” or alternatively not

“representative,”1 under Flowers if the market imports less than

three percent of the subject merchandise exported from the home

market. See id. at 16-17; FAST’s Reply Br., at 3-4. Because in

this case Chilean exports of salmon to Canada were under one

percent of the total Chilean exports of salmon, FAST argues that

the Flowers norm prohibits the selection of Canada as a thirdcountry NV market. See FAST’s Br., at 17-18.

FAST’s argument lacks merit because Flowers did not create a

prior norm that Commerce is compelled to follow. See 63 Fed.

Reg. 5,357. The law is clear. Agencies must conform to prior

norms or explain their reasoning for departing from those norms

so that a reviewing court may understand the basis of the agency
Court No. 98-09-02782 Page 8

2

 Moreover, even if Flowers established a “norm,” it is

questionable whether it could be considered a “prior norm”

because the Final Results in Flowers was published one day after

the Final Determination in this case. See 63 Fed. Reg. 31,417. 

FAST argues that Commerce’s Amended Final Determination was

published on July 30, 1998, and therefore post-dates Flowers. 

Especially given the fact that no norm exists, the Court is not

persuaded by that technicality.

action. See, e.g., Atchison, Topeka & Santa Fe Ry. Co. v.

Wichita Bd. of Trade, 412 U.S. 800, 808 (1973). Here, however,

there was no prior norm to follow. The Court can find no

explicit explanation, and FAST fails to offer any, of what is

required to establish a prior norm. It is clear to the Court,

however, from the plain meaning of the term and from the implicit

reasoning in the decisions of this court, that Flowers alone

cannot establish an agency norm. See Atchison, 412 U.S. at 808

(“settled rule” used in relation to prior norm); Hussey Copper,

Ltd. v. United States,834 F.Supp. 413, 419 (1999)(“traditional

methodology” and “normal practice” used in relation to prior

norm). The word “norm” connotes consistency over time. See id.

FAST explicitly concedes that Flowers is the first, and only,

instance in which Commerce purportedly decided that a market was

unimportant or non-representative based on an analysis of the

total home market exports compared to third-country market

exports. See FAST’s Reply Br., at 3. Therefore, Flowers did not

establish a prior norm Commerce was required to follow.2
Court No. 98-09-02782 Page 9

B. Commerce Improperly Applied the CEP Offset.

FAST argues that Commerce improperly applied the antidumping

statute to determine whether Aguas Claras should receive a CEP

offset for Level of Trade (“LOT”) differences between the salmon

Aguas Claras sold in the United States and the salmon it sold in

Canada. See FAST’s Br., at 23-28. Specifically, FAST argues

that Commerce improperly deducted section 772(d) selling expenses

prior to comparing LOT for purposes of giving a CEP offset. See

id. at 27. 

The Court has previously decided this issue. See Micron

Tech., Inc. v. United States, 40 F. Supp. 2d 481, 485-86 (1999). 

In Micron, the Court expressly held that Commerce may not deduct

CEP selling expenses prior to conducting a LOT analysis because

to do so would make the CEP offset automatic. See id. at 486

(citing Borden, Inc. v. United States, F. Supp. 2d 1221, 1235-42

(1998) (Restani, J.). The Court therefore remands this issue to

Commerce for the application of LOT methodology in conformity

with Micron, Borden and the governing statute. See Mircon, 40 F.

Supp. 2d at 485-86; Borden, 4 F. Supp. 2d at 1240-42.
Court No. 98-09-02782 Page 10

IV.

CONCLUSION

For all of the foregoing reasons, the Court sustains the

part of the Final Determination pertaining to Commerce’s

selection of Aguas Claras’s third-country NV and remands to

Commerce the part of the Final Determination pertaining to Aguas

Claras’s CEP offset. A separate order will be entered

accordingly.

 

_______________________

 Richard W. Goldberg

 JUDGE

Date: April 20, 2000

 New York, New York