Slip Op. 07 - 185



## UNI TED STATES COU

RT OF INTERNATIO

NAL TRADE

____________________________________ : AGRO DUTCH I

NDUSTRI ES L I MI TED, : : Plaintiff, :

: v . : Before: M USGRA VE, Senior Jud ge

: Court. No. 02-00499 UN I TE D ST AT ES, : : De fe nd ant, :

: an d :

: COAL I TI ON F OR FAI R PR ESERVED : MUSHROOM TRADE, : : Def

endant- I nterve nor. : ____________________________________: OP IN ION AN D O RD ER [On consideration of the r esults of rede termination of the se cond adminis t ra tive revie w of mushrooms from I ndia with respe ct to the pl aintiff pursuant to court orde r by the U.S. Depa

rtment of Commerce , I nternational Tra d e A d mi n is tr ation (“Commerc e”) , wher ein Commerce ag ain applied partial a dverse fac ts available w ith respec t to certa in s al es i n v o lving a customer of

the plaintiff, matter a g ain re manded f

or re deter mination consistent with thi s opinion.] Dated: De cembe r 26, 2007 Garve y Schube rt Barer

( Lizbeth R. Levinson , John C. Kalitka , and Ro na ld M . W isla ) for the plaintiff. J e ffr e yS. Bu c ho ltz , Acting Assistant A ttorney Gene ral, Civil Division, Unit ed S t ates Depa rtment of Just ice, Je a n n e E

. Davidson , D ir e c to r , Commer cial L itigation B ranc h, Civil Division, United S tates Department of J ustice ( Richard P. Schroe der); I nternational Office of Chief Counsel for Import Administration, United St ate s Department of Commerce ( Matthew D. W

alden ), of c ouns e l, f or the de fe nd ant. Col lie r, Sh an no n, Sc ott

, P LLC ( Adam H. Gordon and Michae l J. Coursey ) f or the de fe nd antintervenor

.Court No. 02-00499 Pag e 2

I n Slip Op. 07-25 (Fe b. 16, 2007), familiarity with which is presumed, the U.S. Depar tment of Commerce , I nternational Trade Adminis t ra t i o n (“Commerc e”) was orde red to re visit t he

a pp lic a tio n o f part ia l a dv e rs e fa c ts a va ila ble on c e rt a in s a le s o f t

he pla int if

f A g ro Dutc h Ind

us tr ie s, L td. that first resulted in Certain Preserv ed Mushrooms From India: Final Results of Antidumping Duty Administrative Rev iew , 67 Fe d. Reg . 46172 (Jul y 12, 2002). No w b ef

ore the Court are the Results of Redeter

mination Pursuant to R emand ( May 3, 2007) (“

Re ma nd Re su lts ”) r eaf

firming the

same a pplication of par

tial adver se fa cts ava ilable to such sales and the pa rties’ c omments thereon. As order ed, in the re deter mination Com merc e explains in gre ater detail its process of

g ather ing information with respe ct to the arr ang ement betwee n Ag ro Dutch and “Customer A” and the impac t of the “ neg ative cr edit period” transac tions (“Set X” sa les), the r emaining sales betwe en Ag ro Dutch and Customer A (“ Set Y” sale s), and a lso sales from Ag ro Dutch to other custom er s for whic h Customer A was to re ceive pay ment from such othe r customer s (“Set Z ” sale s). Gene rally , the theme of

the Re ma nd

Re su lts revolve s around the de termination t h at Agro Dutch’s que stionnaire re sponses war rante d an ad v er se infer ence during the administrative re view proce eding . First, the r emand r esults summarize that

Ag ro Dutch repor

ted to the Depa

rtment in its ini tial questionnaire r esponses that it made all sales to the United Sta t es on a spot-sale basis and had no ag ree ments with any

U.S. customers. Ag ro Dut ch tol d the Depa rtment that all sales to the Unit ed S tates were made with pay ment terms of 90 da

y s after the bill of lading date and that it ha d repor ted the ac tual date of

pay ment for all U.S. sales except for the sales unpa id as of the r esponse submission date. Ag ro Dutch a cknowledg ed that Customer A had a role differ ent from other customers be cause it was a c omm i s s i o n ed sale s ag ent, but Ag ro Dutch of fe re d n o f ur the r i nf or matio n o n it s c omm iss ion arr ang e me nts , a lth ou g h it was spec ifically

reque sted to do so. Re ma nd Re su lts at 4.Court No. 02-00499 Pag e 3

The Re ma nd

Re su lts next describe the first supplemental questionnaire to Ag ro Dutch, wh er ei nC o m m er ce re qu es t edre s p o n s es t o t h e f o l l o wi n g: Sa le s P ro c ess 2. Specify

whether any sales agr eeme nt or contract ex ists betwee n Ag ro Dutch and its U. S. c us tom e rs . 3. S p ec ify whether or not A g ro Dutch and its U.S. customers have any l o n gterm or multi-purcha se contra cts or ag ree ments. I f so, provide copie s of such ag ree ments applicable to sales duringthe POR. . . . 38.0 Commi ssions 1. Ex plain the basis of the c ommissi on rate s paid to commissionaires. Provide more de tail to ex plain what dete rmines the rate paid on ea ch s al e. As examples, show how the commission wa s deter mined for sa le observations 101 and 500. Provide c opies to support how the commi ssion was deter mined and paid. Id . (summarizing Public Recor d Document ( “PDoc” ) 80). The Re ma nd Res ul ts note that Ag ro Dutch r esponded that it “d[ id] not have a ny binding contra cts or ag ree ments wi t h an y U.S. customers duringthe POR” bec ause “ [t ]he quantities and price s of all s al es ar e subjec t to chang e until the date of shipment.” Id . (quoting PDoc 91 at 1, brac keting added) . Reg ardingcommissions, Agro D utch explaine d th a t the rele vant commissionaire involved in the sale of obse rvations 101 or 500 wa s paid a commiss ion based on a perc entag e of the cost-insuranc e-f

re i g ht (CI F) value of

sales booked by

a ce rtain entity , or if the sa le had be en “di sco un ted by us in g the Letter of C redi t” f

rom Cu st om er A, th en b asedon th e free- on -bo ard ( FOB) value of the sale, id . at 5, and the Re ma nd Re su lts state that “ [t]his su

bmi ssi on wa s the fi rs t ti me in this review that Ag ro Dutch attempted to de scribe this c ommissi on proce dure” but that “ Ag ro Dutch offe red no f

urther e x planation re g ardingthis arra ng ement.” Id . at 4.Court No. 02-00499 Pag e 4

The Re ma nd

Re su lts then state that the pe titioner commented that t h e patter n of pay ment dates pr ec ed i n g s hipment dates provided a “strongindication” that Ag ro Dutch ha d repor ted an inc or re c t y e ar v a lue in the “ PAT ED AT EU ” fi e ld o f e le c tr on ic data , th a t A g ro Dutc h’ s r e sp on se s d id

no t pr ov ide “ any

ind ic a tion” of

the e xten t of

pr e pa y me nt, and

that “ su c h p re pa

y me nt w ou ld

ne c e ssi ta te a

lon g -t e rm

c on tr a c tua l obl igat io n, and wo uld un de rm ine the date of

sa le c ur re ntl y repor ted by Ag ro Dutch.” Id . at 5 (quoting Confidential Record D ocument (“ CDoc”) 30). The Re ma nd Re su lts note that Ag ro Dutch the n responde d the re ported pa

y ment dates are corr ect. For the re fer ence d observations, Agr o Dutch has r eporte d as the pa y ment date the d at e that Ag ro Dutch r ece ived a dv anc e s p ro vid e d b y

[Cus to mer A]. Th e c a sha dv anc e s w e re pa id i n anticipation of futur e shipments for whic h the customer, pr oduct and pr ice wer e not deter

mined at the time of the a dvance

. [C ustomer A] arra ng ed for ce rt ai n U. S

. s al es o n b eh al f o f Agr o Du t ch an d as re p o rt ed i nAgr o Du t ch 's Section C que stionnaire response , ear ned a c ommissi on of [ sic ] ce rt a in U .S. sa le s. Id . (as quoting CDoc 34 at 2). T he Re ma nd Re su lts char acte rize this response as pr oviding “ more detail about Ag ro Dutch’s s al es t o Customer A than wa s previously disclosed” a

nd highlig hting

“ Ag ro Dutc h’ s con tin

ue d fa ilure to fu lly e xpla in its ag re e me nt wit h Cust ome r A .” Th e y

a lso state that [a] lthough Ag ro Dutch maintained in p r ev i ous submissions t hat it had no

agreem ents of any kind with any U.S. customer, this expl anation indicate d that, in fac t, Ag ro Du t ch an d Customer A had some sort of ag ree ment for wh ic h c a sha dv anc e s h a d b e e n p a id. Th e juxta po sit ion of

thi s st a te me nt w ith the statement about Customer A’s commissionaire role added to the appar ent c on tr a dic tio n be tw e e n Ag ro Dutc h’ s state me nts that no a g re e me nt s w ith cu s t o m er s ex i s t ed , an d

al l s al es we re m ad e on a sp o t b as i s , an d Agr o Du t ch 's n ew s t at em en ti mp l y i n g t h at s o m e s o rt o f “ agr ee m en t ” o r “ u n d er s t an d i n g” wa s in pla c e fo r whic h Cu sto me r Apai d for its c ann e d mu sh ro oms in advanc e.Court No. 02-00499 Pag e 5

Id . (italics adde d). The Re ma nd Re su lts then explain that for the pre liminary results Commerce conclude d that it “was not able to determine the appropr iate date of sale for the U.S. sale s cover ed by the a g re e me nt” be c a

us e it ha d “o bs e rv e d a

sig nif ic ant n umb e r o f s a le s ma de to C us tom e r Awi th pay ment dates prior

to the shipment date” ( i.e. , the Set X sales)

. Id . Additionally , the Remand Re su lts state, “A g ro Dutch’s latest explanation reg arding the advance pay ment was at odds with the

s t a t e m e n t s i ni t s qu e s t i o n n a i r e r e s p o n s e s t h a t a l l s a l e s w e r e s o l d s u b j e c t t o p a ym e n t w i t h i n9 0 d ays of the bill of lading .” Id . at 5-6. The Re ma nd

Re su lts then explain that Com merce then issued a se cond supplementa l questionnaire on Ma

rch 7, 2002, a fter publ i ca t i o n o f t he pre liminary results. I n it, Com merc e reque sted that Ag ro Dutch

1. Ex plain in det ai l the sales a nd pay ment terms for tr ansac tions invol ving pay ment advanc es, as i d entified on pa g e 2 of the Fe bruar y 11, 2002, submissi on. I n particula

r: a. Specif y whether or not any

ty pe of w ritten sales a g ree ment or contra ct e xists wi th r e g ard

to t his c us tom e r. I f s o, pr ov ide the do c ume nt( s) . E xpla in why the a g re e me nts we re no t pr ov ide d earl ie r in re sp on se to [Co mme rc e ’s ] questionnaire a

nd supplemental questionnaire

. b. Ex plain th e appare nt contradic tion between the descr iption of pay ment terms to this customer in the Fe bruar y 11 submissi on, and the state ment at pag e C-12 of the May

25, 2001, response that all of Ag ro Dutch’s U.S. sale s are made with pay

ment terms of 90 da

y s after the bill of lading date. Id . at 7 (quoting PDoc 129). At this point , as desc ribed in the Re ma nd Re su lts , Agr o Dutch explained that Customer A ha d a sk e d it

to pr od uc e a c us tom ize d pr od

uc t and ha d pr ov ide d “ a dv anc e pa y me nt d e po sit s . . . in eff ect a s secur ity

for f uture sale s of a ne w produc t.” Elaborating, Ag ro Dutch e x plained thatCourt No. 02-00499 Pag e 6 [t ]here is no written ag ree ment, only an ora l understanding . Moreove r, the advanc es we re pr ovided wi thout reg ard to de finite future sales. Indeed, the whole idea

of the a dvance w as to provide a form of se curity

ag ainst future order s. Th e re wa s n o c or re sp on din g c on te mpo ra

ne ou s a g re e me nt t o s hip sp e c if ic qu anti tie s to sp e c if

ic c us tom e rs a t sp e c if

ic pr ic e s. As we beg ans h ip p in g A

- 1 mu s h r o o ms , an d th e y w e r e a c c e p te d

b y the ultimate customer, [Cust omer A] soug ht the quick re turn of its advanc e pay ments. We ag ree d to cre dit the deposit s ag ainst sales of other products as well as A-1 mushrooms. I n addition, we ag ree d to cre dit the advanc e pay ments agai n s t sales to other c ustomers who would ag ree to pay the invoiced amounts to [C ustomer A] rather than to [Agro D utch]. This enabled [C ustomer A] to recove r i ts advanc e pay ments ear lier. The invoice s at issue note that the sale was made ag ainst advanc e pay ment, and whe re [Customer A] w a s n ot t

he c us tom e r, it i s sh ow n a s th e c on signee. F or the se sa le s, [C ustomer A] collected pa y ment from the ultimate customer

. . . . No written sale s ag ree ment or contra ct betwe en [Ag ro Dutch] and any customer, including [ Customer A] of any ty pe was in eff

ect during the POR or re g ard ingsa le s ma de duri ngthe POR

. [Agro D utch]’s standard pa y ment terms are 90 day s afte r bill of lading date, and these terms applied to a ll c ustomers during the POR. W ith respec t to the a dv anc e pa

y me nts ma de by

[Cus tom e r A ], ob vio usly th e cu sto me r p a id i n advanc e and thus did not have 9 0 day s to pay . For those sales to which the a dv an c e p ay

m e n t s w e r e a

p p l i e d , i tw o u l d

h a v e b e e nm o r e a c c u r a t e t o s ta te that the terms of pa

y ment wer e pay

ment in adva n ce . W e apologize for any confusion this may

have c aused. Id . at 7-8 (quotingPDoc 142 at 1-2)

. The Re ma nd

Re su lts s tate th a t A g r o D u tc h ’ s e xp la n a ti o n“ thr e w in to d o u

b t” Co mm e r ce’ s assumptions concer

ning the nature of the sales as U.S. e x port price sales. Id . at 8. Cf. 19 U.S.C. §§ 1677a(a ), 1677a( b). This was so, the Re ma nd Re su lts explain, because this was “the f irst time” Ag ro Dutch re ported to Commerce that other c ustomers pay Customer A for the ir purcha ses rather than Agro Du t ch, and be cause Ag ro Dutch still “did not expl ain how or w hy its letter of cr edit was discounted on ce rtain sales.” Id . Acc ording to the Re ma nd Re su lts , this new information whe nCourt No. 02-00499 Pag e 7

combined with Ag ro Dutch’ s previous “inc omplete re sponses” purpor tedly “ra ised additional issues which nee ded to be r esolved[,] ” spec ifically that [a] lthough Ag ro Dutch c laimed that it was not aff iliated wi t h C u s t o mer A, Cus tom er A’s role a s c oll e c tio n a g e nt a nd c on sig ne e , in

a dd iti on to commissionaire, may

indicate a

relationship equivalen t t o affiliation that would bear

further examination and analy sis to determine whe ther transac tions involving Customer A wer e CEP sale s, or eve n whether Custo me r A ’s sa le s to its c us tom e rs , r a the r t ha n A g ro Dutc h’ s sa le s to Cus tom e r A , s ho uld

have be e n s ub

je c t to our a

na ly sis

. As Customer A ac ted as a collection ag ent, commissionaire, a nd consig nee for some of

Ag ro Dutch’ s sales to other c ustomers, and its letter of cre dit was us e d to d is c o u n t c e rta in s a le s , Cu s to me r A ma y h a v e b e e n inv o lv e d in the sales neg otiation process. Customer A’ s interac tion with Agr o Dutch’s other customers re quired fur

ther e x amination in order to de termine whe ther a ny sales neg otiations ha d been completed in the United States and thus whethe r the se sa le s c on sti tut e d CE P sa le s. Ba sed on its expl anation in [th e sec ond supplemental questionnaire response ], for those sales where certa in customers paid Customer A instead of Ag ro Dutch, Ag ro Dutch repor ted the pay

ment date as the date of

one of Customer A’s pay

ment advanc es, not the date t he customer paid Customer A, no r t he date Ag ro Dut ch cre dit e d th a t c us tom e r’ s a c c ounts re c e iva ble ba l an c e . B e c a

u s e t h e D e p art m e n t a

p p l i e d A F A [a dv e r s e f

a c t s a v a i l a

b l e ] to the se sa le s, the De pa

rtme nt d id n ot a dd

re ss in the F ina l Re su lts wh e the r u se of thi s re po rt e d pay

me nt date wa s app ro pr iate fo r c a lc ulatin g imp ute d c re dit expense. Had the Depa

rtment not a

pplied AFAto these sales a nd instead had a tte mpt e d to c a lc ulate a

rate, it d id n ot h a ve the inf or matio n n e c e ssa

ry to calc ulate the imputed c redit expense unless it a cce pted Ag ro Du tch’s m e t h o d o l o g y. Id . at 8-9. The Re ma nd

Re su lts the n c lari fy that Co mme rc e re sp on de d to Ag ro Dutc h’ s r e sp on se to i ts second suppleme ntal questionnaire a s proof that Ag ro Dutch ha d “withheld” information and/or ha d there fore “sig nificantly impeded” the proce eding within the meaning of Section 1677e of Title 19, United States Code, in its ini tial and/or supplemental que stionnair e re s p onses. See 19 U.S.C. §§Court No. 02-00499 Pag e 8

16 77 e (a )( 2) (A ), 16 77 e (a )( 2) (C ). He nc e , Comme rc e a sse rt s th a t it wa s ju sti fi e d in

re so rt ingto f

a c ts otherwise a

vailable a nd an adve rse infe renc e in the sele ction there of. Ag ro Dutch a

rg ues the matter must be rema nded ag ain. The de fenda

nt-intervenor s provided no comment, while the g overnme nt supports the Re ma nd Re su lts as is. For the following rea sons the matter r equire s further rema nd. Discussion

I As a pr e lim ina

ry matte r, the de fe nd ant’ s arg ume nt t hat A g ro Dutc h f

a ile d to e xha

us t

a dmi nis tr a tiv e re me die s is wi tho ut me ri t. A lso , th e re c or d d oe s n ot c on ta in s ub sta nti a l e vid e nc e to

su pp or t Co mme rc e ’s c ha

ra c te ri zat ion

that “A g ro Dutc h mai nta ine d in pre vio us su bmi ssi on s tha t it ha d n o a g re e me nts of any kind wi t h an y U.S. customer” a

nd that “no agree ments with customers existed .” E.g. , Re ma nd

Re su lts at 4 (italics adde d). This is an inaccurate charac terization of Ag ro Dutch’s e arlier

response s. I n the initial questionnaire, Commerc e qualifie d its request for “ag ree ment(s)” with “y our ag ree ment(s) for sales in the United States.” See PDoc 20 at A- 7. Com me rc e did

no t s peci fi c a lly

re qu e st i nf

or matio n r e g ard ingAg ro Dutc h’ s “ arr ang e me nt” wi th Cus tom e r A in the ini tia l qu e sti on na ir e , un le ss that arr ang e me nt m ay be c ha ra c te ri zed a s a “ sa le s” ag ree ment; howeve r, not hing in the r ecor d appea rs to contra dict Ag ro Dutch’ s consistent responses that it did no t ha ve a “ sa le s” a g re e me nt with C us tom e r A , a nd that a ll i ts s a le s, inc lud ingtho se to Customer A, are spot-sales at whic h point price a nd quan t i t y ar e d eter

mined. Thus, to the extent Ag ro Dutc h c or

re c tly c ha ra c te ri zes its a g re e me nt wit h Cu sto me r Aa s o the r t

ha n a sa le s a g re e me nt, Ag ro Dutc h’ s in iti a l qu e sti on na ir e re sp on se wa s n ot u ntr uth fu l.Court No. 02-00499 Pag e 9

Fur ther, Ag ro Dutch did not “insist” in the first supplementa l ques t i o n n aire that it did not have “ any” ag ree ments with its customers. The fir st supplemental questionnaire a sked Ag ro Dutch to “ [s]pe c if

y wh e the r a

ny sa le s a g re e me nt o r c on tr a c t e xists be tw e e n A g ro Dutc h and its U. S.

c us tom e rs ” or

wh e the r “ Ag ro Dutc h o r i ts c us tom e rs have any lon g -t e rm

or mul ti- purc ha se c on tr a c ts or ag ree ments” and to provide copies of any . Ag ro Dutch r esponded that it “d[ id] not have a ny binding contra cts or ag ree ments with any U.S. customers during the POR” and that “[t] he quantities and pric es of a ll sales are subject to c hang e until the date of shipment.” PDoc 91 at 1 (italics a dded). Ag ro Dutch did not provide a complete a nswer to the que stion asked, se e su pra , bu t it d id n ot s tate that it did not hav e “a n y ” agr ee ments with its custom ers. It merely stated that it did not have any “binding ” ag ree ments with its custom ers, whatever that implies. No ne the le ss, Com me rc e ’s c ha ra c te ri zat ion s a mou

nt t o h arm le ss e rr or . A mon g oth e r thi ng s, section 1677e r equire s the use of f acts other wi s e available as a r esult of a r espondent’s “withholding” of information. 19 U.S.C . § 1677e(a )(2) (A). The first supplemental questionnaire sp e c if ic a lly a sk e d f or inf or matio n c on c e rn ingAg ro Dutc h’ s lo ng -t e rm or mul ti- purc ha se c on tr a c ts wi t h o u tqu al i fi ca t i o n . A g r o Du t ch re s p o n d edwi th t h e q u al i fi ca t i o nt h at i th adn o “b i n d i n g” ag ree ments. Whether that statement is true, Agr o Dutch could rea sonably infer f rom the question asked that Comm erc e desire d disclosure of whateve r “ar rang ement” Ag ro Dutch had with Customer A. B e c a us e Ag ro Dutc h’ s r e sp on se did no t ans we r the qu e sti on

a sk e d a nd wa s n ot u

nq ua lif ie d, it was incomplete

. Cf

. CDoc 20 with CDoc 47. The recor d there fore contains subs tantial evidenc e to support the fin d i n g t h at Ag ro Dutch “ withheld” information in accor dance with subsection 1677e(a )(2) (A). A t this poi nt, however , it is i mportant to note that Co m m er ce never made aCourt No. 02-00499 Pag e 10

I f a r esponse is “not satisfac tory ,” the information must still be conside red if it satisfies the 1 re q uirements of se ction m(e), which provides that Commerc e shall not dec line to consider information submitted by

an intere sted party that is ne cessa ry to the deter

mination but does not mee t all applicable require ments established by C o m m er ce if (1) the inf

ormation is submit ted by the deadline e sta blished for its submissi on, (2) c an be ( i.e. , is c a pa ble of be ing ) v e ri fi e d, (3 ) i s n ot s o incomplete as to be unreliabl e, (4 ) t h e intere sted party acts to the be st of its abilit y to provide the information and mee t Comm erc e’s requireme nts with respe ct to the information, and ( 5) ca n be used without undue difficulties. 19 U.S.C. § 1677m(e). The defic iency of t he response i s not, by itself, a rea son for r ejec ting other pertinent infor

mation therein. See SAA at 865. At any rate , a timely and (continued...) deter mination of whether

Ag ro Dutch’ s arr ang ement with Custom er A , as explained in the second supplemental re sponse, was in fa ct a “ long- term or multi-purcha se ag ree ment.” II When it becomes nec essar y to fill information ga

ps in the admini strative record, the statutes g overning the s e ty

p e o f p r o c e e d in g s r e qu ir e th e u s e o f f a c ts o th e r

w is e a v a il a

b le s o th a t t

he investigation or administrative revie w may proce ed. See 19 U.S.C. § 1677e(a) . Howeve r, any g apfi l l i n g m u s tl at er

gi v e w ay

t o ac tu al i n fo rm at i o no b t ai n edd u ri n g t h e c o u rs e o f t h e p ro ce ed i n g, whether obtained pur s u ant to section 1677m(d) or rec eived f

ulfilling the re quirements of se ction 1677m(e). Cf. 19 U.S.C. § 1677e(a ) (“subject t o” sec tion 1677m(d)) with 19 U.S.C. §§ 1677m(d) , 1677m(e). Be cause Ag ro Dutch’s previous response s to c erta in que stions had been defic ient for purposes of the proce eding , Commerce s en t a sec ond supplemental questionnaire to Ag ro Dutch, appar ently

pursuant to se ction 1677m(d). That provision requir ed Commerce to inform Ag ro Dutch

“ of the natur e of

the de fi c ie nc y ,” pr ov ide an o pp or tuni ty “to rem e dy

or e xpla in” the de fi c ie nc y

in light of t h e t i m e li mit for completing the re view, and de termine whe ther the r esponse to the defic iency

notice, as embodied by Ag ro Dutch’s se cond supplementa l questionnaire, wa s timely and satisfac tory , or untimely or not satisfac tory

. The provision thus aff orded Ag ro Dutch the 1Court No. 02-00499 Pag e 11

(...continued) 1 satis fa c tor

y re sp on se to a

de fi c i e n c y

n o tic e ob viate s c on sid e ra tio n o f t he re sp on se in a c c or da

nc e wi th section 1677m(e)

. opportunity

to cure the def

iciency of its prior submission(s) prior t o the completion of the proce eding . I f the de ficienc y was c ured the re b y , whateve r re asons for its havingbeen de ficient

ear lier in the proc eedingare rende red irr eleva nt, beca use there is now no longe r a “ g ap ” in the i n fo rm at i o nn ec es s ary

fo r t h e p ro ce ed i n g. Commerce was t hus require d pursuant to section 1677m (d) to evaluate t he four corne rs of Ag ro Dutch’ s second suppleme ntal questionnaire r espo n s e o n its own merits. I n applying that pro v i s ion, the Re ma nd

Re su lts descr ibe the sec ond supplemental questionnaire response ’s de sc ri pti on

of Ag ro Dutc h’ s arr ang e me nt w ithCus tom e r Aa s “ no t satis fa c tor y ” be c a us e it

“ de mon str a te d th a t A g ro D ut c h’ s p re vio us re sp on se s [ha d b e e n] mi sle a din g and unre lia ble wi th respe ct to the terms of sa le with Customer A, including the sale dates and pay ment dates” for the Sets X, Y, and Z sales. Re ma nd Re su lts at 11, 13, 15. The Re ma nd Re su lts call spec ific attention to the fac t that Ag ro Dutch r eporte d in its i nitial questionnaire re sponse that its st an d ar d terms of pa y me nt w e re 90 da

y s w he re a s it

state d in its se c on d s up ple me nta l que sti onna ir e re sp on se that “ it would have be en more acc urate to state that the t er m s o f p aym ent wer e pay ment in advanc e” f

or Customer A. Id . at 8 (quoting PDoc 142). The Re ma nd Re su lts insist that “Ag ro Dutch misled the Depa rtment by stating flatly

at pag e C-12 of [its ini tial questionnaire r esponse] that ‘[a]l l of our sale s

are made [with] pay

ment terms of 90 da

y s after bill of lading date[.] ’” Re ma nd Re su lts at 11. It i s a r g uable whe ther Commerc e ca n rea sonably

claim to have be en “misled” when the initial qu e sti onna ir e re qu e ste d “ te rm s of pa y me nt” inf or matio n a nd in r e sp on se Ag ro Dutc h s tate d w hat it sCourt No. 02-00499 Pag e 12

For Commerce to c laim from s uch cir cumstance that it had been “ misled” at the outset 2 would amount to an abdication of its ana ly tical re sponsibili ties. Cf

. A nti dumpi ng(“ AD ” ) M anu a l, Ch. 5 at 8 (Dep’ t of Comm., I TA, I mport Ad m inistration) (conf ounding “ pay

ment terms” whe n admitting that “[c]laims for diffe renc es in c redit costs must be based on a ctual pay ment experience rathe r than nominal pay

ment terms”)

. “Comm i ssions are pa y ments to parties providing service s that relate to the sale of 3 merc handise.” Id . , Ch. 5 at 29. standard or

nominal terms of pay

ment are . I n addition, Ag ro Dutch pr ovided data show ing a dvance pa y me nts fr om C us tom e r Aa s p art of its initi al qu estion na ir e re sp on se s. I n li g ht o f s uc h d a ta 2 elsewhe re in the rec ord, at best Commerce could claim Ag ro Dutch’ s specific response s had nee ded

c lari fi c a tio n a

nd ha d th e re fo re be en “def

ici ent,” bu t th e re c or d s ho ws that Co mme rc e did no t a sk specific ally

for c larifica

tion of observe d discrepa

ncies be tween a ctual pay

me nt a n d te r ms o f p ay ment in its first suppl emental que s ti o nn a ir e , it o n ly reque sted clar ification of “ commissions.” Ag ro Dutch 3 did, however , volunteer a clar ification whe n it responded to the pe titioner’s comments. That amounted to an oppor

tunity t o re medy

the def iciency , and Ag ro Dutch a lso provided a more

c omp le te e xplanatio n th e re of su bs e qu e ntl y . Com me rc e ’s state d re a so ns fo r its d iss a tis fa c tio n w ith Ag ro Dutch’ s expl anation ar e ther efor e untena ble. I n any event, Commerc e ’ s f

o r e g o in g an a ly sis of Ag ro Dutch’ s second supplemental questionnaire r esponse wa s not a proper application of 19 U.S.C. § 1677m(d). Commerce did not consider o r

e v a lu a te th e in f

o r mati o nc o n ta in e d

th e r e in o nit s o w nme r it s b u t i n s te a d u s e d the informat io nin

ana tt e mp t t o d e f

e a t A g r o D u tc h ’ s e ar li e r

r e s p o n s e s . T h a t d e f

e a ts th e r e me d ia l purp os e of

se c tio n 1 67 7m( d) to p ro vid e no tic e of defic ie nc y and the op po rt

un ity to c or re c t it

. Com me rc e ’s ana ly

tic a l f laws are dis c us se d in

g re a te r d e ta il a s f

oll ow s.Court No. 02-00499 Pag e 13

A The R e ma nd

Re su lts s t at e t h at co mp l et e i n fo rm at i o np er t ai n i n g t o Agr o Du t ch ’s arra n gem ent wi th C us tom e r A wa s la c kin g on the re c or d, su c h that th e Se ts X , Y and Z sa le s c ou ld n ot b e fu lly analy zed. I nformation wa s lacking , acc ording to the Re ma nd Re su lts , beca

use t h e second supplemental questionnaire response reve aled “ for the f irst time” that other customers pa y Customer A for the ir purcha ses rather than A g ro Dutch, a nd th ere fore “thre w into doubt” Commerce’ s “pre vious assumptions concerningthe nature of U.S. sales a s EP sa les” and “ra ise[d] more que stions than it answer [ed.] ” Specif ically , the Re ma nd

Re su lts state that “A g ro Dutch did not f ully answe r previous q u es t i o n s posed in the initial questionnaire a nd the August 9, 2001, supplemental qu e sti onna ir e c on c e rn ingits c omm iss ion a g re e me nt w ithCus tom e r Aand the te rm s und e r whic h it

rec eived c ommissi ons.” Re ma nd Re su lts at 8. That is, Ag ro Dutch “did not explain how or why its letter of cre dit was discounted on ce rtain sales,” id ., and Cus tom e r A ’s ro le a s c oll e c tio n a g e nt, commissionaire and c onsigne e for some of Ag ro Dutch’s sales to other c ustomers “may indicate a relationship equivalent to a ffiliation” or a deg ree of involvement in the sales proc ess that re quires fu rt he r a na ly sis to determ ine wh e the r C us tom e r A tr ans a c te d CE P sa le s and the e xten t of

its involvement in the “sales neg otiation process.” Se e Re ma nd Re su lts a t 8- 9. As to t

he Se t Z sa le s, the re mand re sults st ate that a pplication of adve rse f

acts available to t h es e s ales obviate d consideration of whether use of the repor ted pay ment date wa s appropr iate for calc ulating imputed

cre dit ex pense in the f

inal results. Re ma nd

Re su lts at 9. At this point, it becomes a ppare nt that the Re ma nd

Re su lts confound pr oper a

naly sis of Ag ro Dutc h’ s se c on d s up ple me nta l qu e sti onna ir e re sp on se wi th a na ly sis of the e vid e nc e of re c or d a s aCourt No. 02-00499 Pag e 14

whole, bec a

u s e th e p o in ts r a is e d

c o n c e r nin f o r mati o np r o v id e d

f o r th e r e c o r d

mu c h e ar li e r

in the proce eding than the sec ond supplemental questionnaire response . A re sponse nec essitating f urther

e xplanatio n is , b y

de fi ni tio n, de fi c ie nt, bu t th e se c on d s up ple me nta l qu e sti onna ir e did no t r e qu e st

e xplanatio n o f h owor

why Agro Dutc h’ s lette r of c re dit wa s d isc ounte d o n c e rt a in s a le s, no r d id i t

a sk fo r a dd iti on a l in fo rm a tio n r e late d to a c omm iss ion

a g re e me nt w ithCus tom e r A . T he on ly appar ent fa ct the sec ond supplemental questionnaire response clar if i es i s with respec t to invoices alre ady provided to Commerce ear lier in t h e proce eding and on which Customer Ais refle cted a s the consig nee. T he explanation provided in the second supple mental questionnaire indicated that f o r s a l e s A g r o D u t c h m a d e t o c e rt a i nc u s t o m e r s i ts e t t l e d t h e a c c o u n tr e c e i v a

b l e b a l a n c e b y a

c or re sp on din g re du c tio n in

the s e c u r i t y - p a y m e nt o r a dv anc e -p ay

me nt l ia bil ity be ingma int a ine d w ith respe ct to Customer A, in e ffe ct transfe rring the ac count re ceiva ble balanc e owe d from such othe r customer to Customer A. The only obvious impact such a clar ification oug ht to have is with respe ct to the so-ca lled Set Z sales, and Commerc e does not a dequate ly explain why this clar ification is fata l to export price ana ly sis of all sales involving Cu s t o m er A (S ets X, Y and Z sales). Commerc e

mere ly implies that thi s is so. Cf. Re ma nd Re su lts at 11 (“ particula

rly for those sa les wher e other customers pa id Custom er A ”). N onetheless, Commerc e appa rently felt justified in concludingfrom Ag ro Dutch’ s second suppleme ntal questionnaire r esponse that it was pr oof of Ag ro Dutch’ s ear lier “withholding” of information, and that such circ umstance w as suffic ient to cause it to doubt Agro Dutch’s e x planation of the entire arr ang ement betwee n Ag ro Dutch and Customer A a nd preve nted deter mination(s) of the date of sale and/or date of pay ment in r espec t of all sales involving Customer A. The c ourt, howeve r, discer ns no contra diction, only clar ification, betwe en Ag ro Dutch’ s ear lierCourt No. 02-00499 Pag e 15

response s and the sec ond supplement al questi onnaire response conce rning Ag ro Dutch’ s

arr ang ement with Customer A and c oncer ning the re p o rt ed d at es of sa le and r eporte d dates of pay ment. Cf

. W o r l d F iner Foods, Inc. v . United States , 2 4 CI T 5 41 , 5 50 (2 00 0) (u nr e a so na ble to conclude a submission contained newfac tual informat i o n , al though it involved fa ctual or methodologic al cha

ng e, whe re r espondent c laimed cler ical er ror a nd soug ht to corre ct re cord)

. Re g ar d in g d ate o f s a le , th e o n ly in d ic a ti o n o n th e r e c o r d o f Co mm e r c e ’ s u n d e r s ta n d ing of wh a t “ a g re e me nt( s) fo r sa le s in the Un ite d State s” e nc omp a sse s is re fl e c te d in the g los sa

ry of te rm s

acc ompanying the in i t i al q uestionnaire, which explains that the “date of a sale ” is normally

the invoice date unless Commerce is “satisfied that a differe nt date better reflec ts the date on which the exporter or produce r established the mater ial terms of sale ( e.g. price , quantity).” PDoc 20, App. I at I -5 (r ef er encing19 C.F.R. § 351.401(i)). See Re ma nd Re su lts at 2. Acc ording to Comm erc e’s

anti dumpi ngmanu a l, “ the date of the inv oi ce is the p re sumpt ive date of sa le , a lth ou g h th is pr e su mpt ion

may be ov e rc ome .” AD Manu a l, C h. 8 at 7. I n o the r w or ds , “ date of sa le ,” no rm a lly presumed to be the invoice date, is that date o n whi ch all mater ial terms of sale are ag ree d. Once deter mined, the date of

sale must b e u s ed consistently

. See , e .g ., Mittal Steel Point Li sas Ltd. v. United States , 31 CI T __, 502 F.Supp.2d 1345 (2007) ( Commerce c oncedingthat it was inconsistent to use the date of

shipment as the date of

sale for purposes of de termining imputed cre dit ex penses while using the date of invoice as the date of sale in othe r contexts of the pr ocee ding) . The Remand Re su lts also state that “[w]hile the Depar tment normally

relies on invoice date as t he date of sale, a diffe rent date may be appropriate if an agr eeme nt exis ts betwee n the re spondent and the c ustomer which esta

blishes the key

terms of sale – price and qu an t i t y

– p ri or to invoicing . S ee 19 CFRCourt No. 02-00499 Pag e 16

See , e.g. , Viraj Group, Lt d. v United States , 3 43 F .3 d 1 37 1, 13 77 (F e d. Cir . 2 00 3) ; NTN 4 Bearing Corp. of America v. U nited States , 26 C I T 53, 67-70, 186 F . Supp.2d 1257, 1273-75 (2 00 2) ; Mitsubishi Heavy I ndustries, Lt d. v. United States , 23 CI T 326, 330-32, 54 F. Supp.2d 1183, 1188-90 (1999)

. Cf

. 19 C.F.R. § 351.410 (circ umstances of sale a djustments). A sale may be deeme d aber

rant a nd excluded from analy sis if too much tim e ela pses betwe en the date of sale and the date of

pay ment. See , e.g , Tianji n Tiancheng Pharmaceutical Co., Lt d. v. United States , 2 9 C IT ___, ___, 366 F.Supp.2d 1246, 1258-61 (2005)

. 351.401(i).” Re ma nd

Re su lts a t 2. B ut, Com me rc e do e s not poi nt to any inf or matio n of r e c or d to contra d i ct Agr o Du t ch’s e x planation that its arra ng ement with Customer A did not amount to an “ag ree ment . . . which esta blishes the key

terms of sale ,” it does n o t adequately explain why

the second suppleme nt al questionnaire response cre ated suc h uncer tainty as to overc ome the pr e su mpt ion th at the inv oic e s f or the Se t X , Se t Y or

Se t Z sa le s c on sti tut e d th e date of the ir

re sp e c tiv e sa le s, and

it d id n ot d e te rm ine that th e inf or matio n o f r e c or d s uf

fi c e d to e sta

bli shthe date of sale for purcha ses pursuant to A g ro Dutch’s arr ang ement with Customer A as t h e d at e t he

arr ang ement wa s ag ree d. Re g ar d in g d a te o f

p ay me n t, Co mm e r c e ’ s s tate d p r e f e r e n c e a c c o r d in g to it s antidumping manual is t o u s e ac t u al ra t her tha n imputed cre dit cost information if it is available. See AD Manual, Ch. 8 at 19. Date of pay ment is important for deter mining, e.g. , th e pr op e r e xch ang e rate that sh ou ld b e a

pp lie d to the ana ly sis of a re sp on den t’s tr ans a c tio ns or fo r d e te rm ini ngc re dit expenses, but the rec ord her e is of “pay ment” of funds t hat Agro Dutch alre ady possessed. Adva nce 4 pa y me nts are the inv e rs e of c re dit e xpe ns e s in that the y re su lt no t in c re dit by the re sp on de nt b ut i n money to the responde nt – and neg ative cr edit observations – but, i n any event, the disc losure of that

c ir c ums tanc e in t

his ins ta nc e ou g ht to have imp a c te d on ly the Se t X and Se t Z sa le s, no t th e Se t Y sales. F or that matter, Commerc e does n o t ex p lain why “the date the customer

paid CustomerCourt No. 02-00499 Pag e 17

A[ ] or the date Ag ro Dutch c redit ed t h at customer’ s acc ounts rece ivable bala nce” are rational choice s for de termining the exchang e rate and imputed cr edit expense, as opposed t o t h e re cord evidenc e of the actua l date of pa y ment, which is w hen Ag ro Dutch actua lly rec eived the f unds, nor do e s Co mme rc e oth e rw ise e xpla in what in fo rm a tio n c on tr a dic ts t he inf or matio n o f r e c or d. Th a t is , Com me rc e do e s n ot e xpla in wh y the “ ne w” dis c los ur e of pa y me nts ow e d fr om oth e r c us tom e rs to Ag ro Dutch a

nd transfe rre d to Customer A nec essar ily and mater ially

altere d the deter

mination of imp ute d c re dit

in t he c on te xt of

fu nd s that have be e n re c e ive d in a dv anc e and that ma y su bs e qu e ntl y be deeme d “pay

ments” for merc handise transac ted. I nsofar as the court can discern, the a gree d settlements of those ac counts would have had no appar ent impact on Ag ro Dutch’ s cash a ccount, nor

c an th e c ourt

dis c e rn any imp a c t on

the re le va

nt t e rm s o f sa le , f

or purp os e s o f a

nti dumpi ngana ly sis , involving customer s aff

ecte d by a tra nsfer of the pa y ee f rom Ag ro Dutch to Customer A. Fur ther, it is err oneous t o char acte rize this as “the first time” t he matter was disclosed, since Ag ro Dutch, in response to pre vious requests for information, had a lrea dy

provided infor

mation for the rec ord to show that Custom er Awas a “consig nee” on cer

tain sales and the ref

ore, in the use of such term, implicated the rec eipt of pay ment from other

customers for

such sales. The fac t of the matter is, for A g ro Dutch inter n al l y i t was mere ly a matter of bookkee ping to tra

nsfer an ac count

rec eivable to Customer A. Commerc e does not e x pl ain why , but it appear s to conclude that, the

me re a c t of

c oll e c tio n a g e nc y on the pa rt of Cus tom e r A ( wh ic h h a d b e e n p re vio us ly dis c los e d, a lbe it indirectly ) is sufficie nt to transmog rify an appa rent produc t development ag ree ment betwee n Ag ro Dutch and Customer Ainto something other tha n as re prese nted by

Ag ro Dutch. Cf. , e.g. , 1 9 U .S. C. § 1677(33) ( definition of “affiliated persons”)

. Substantial evidence there fore does not support theCourt No. 02-00499 Pag e 18

c on c lus i o nt h a tA g r o D u t c h ’ s s e c o n d s u p p l e m e n t a l qu e s t i o n n a i r e r e s p o n s e w a s a “ w h o l e s a le revision” of

what Ag ro Dutch ha d previously provided for

the re cord. Certainly an intere sted party

has an oblig ation t o cre ate a n acc urate rec ord and to provide Commerce w ith requested inf ormation in order

to ensure the deter

mination of an acc urate dumping marg in. See , e.g. , Y

amaha Motor Co., Ltd. v. United States , 19 CI T 1349, 1359, 910 F.Supp. 679, 687 (1995) ( ref

ere ncing Chinsung Indus. Co., Ltd. v. United States , 13 CI T 103, 106, 705 F.Supp. 598, 601 (1989)) . But, Commerc e also ha s the duty of admini stering the proceedingproper ly and fairly , and ag ency action can onl y be upheld on the basis ar ticulated by

the ag ency . SE C v . Ch e ne ry Corp. , 318 U.S. 80, 95 (1943). Ag ain, to the extent practica ble, Ag ro Dutch wa s to be allowed the opportunity

to remedy

or explain any defic ient response pursuant to section 1677m (d). I f Commerce

was unc lear

as to the i nvoices or information Agro Dutch submitt ed or neede d further information

c on c e rn ingc on sig nme nt a nd c omm iss ion

re latio ns hip s, the n it

wa s in c umb e nt up on

Com me rc e to ask re levant questions upon re ceipt of s u ch i nformation. I f, following the sec ond supplemental questi o n n aire response , information was still missi ng and nec essar y to the proce eding , then Commerce must resor

t to fac ts otherwise a

vailable. It could also seek to f ill the ga p by sending Ag ro Dutch an additional supplemental questionnaire with prec ise questions to address suc h missing and

nece ssary information. Reg ardle ss, if there r emained, f ollowing the se cond suppl emental questionnaire, a

misunderstanding as to the information convey ed by the tim e of the final deter mination, the responsibility there for c an har dly

be said to have been sole ly that of Ag ro Dutch. Cf. Chi na Kingdom Import & Export Co., Ltd. v. United States , 31 CI T ___, ___, 507 F.Supp.2dCourt No. 02-00499 Pag e 19

1337, 1363 (2007) ( Commerce be aringresponsibility for the “ unsatisfac tory

state of the r ecor d”due to failure to c omply

with § 1677m(d)). B As mentioned, Commerce did ask for c larification of A gro Du t ch’s c ommissi on

arr ang ements i n the first supplemental questionnaire. I f C ommerce implicitl y deter mined that the first supplemental questionnair e re sponse had be en “not satisfactory” in re sponse to questions

conce rning the le tt e r

o f c redit and c ommissi on arr ang ements, that did not end Commerce ’s ana ly tical obligation. Com merc e either should have a sked for c larification in it s second suppleme ntal questionnaire, or

else it should have c onducted a n analy sis of t he first supplemental questionnaire response pursuant to 19 U.S.C. § 1677m(e). I t does not appea r that Commerc e d i d ei t her. The

se c on d s up ple me nta l qu e sti on na ir e a sk e d f or a de ta ile d e xplanatio n o f t

he sa le s and pa

y me nt t e rm s fo r t ra ns a c tio ns inv olv ingpa

y me nt a dv anc e s, wh e the r a ny wr itt e n c on tr a c t or

a g reement exist s reg ard in g Cu s to me r

A , an d ane xp la n a ti o no f th e “ a p p ar e n t c o n tr a d ic ti o n ” b e tw e e nth e pay ment te rm s d e sc ri be d f

or Cus tom e r A in the F e br

ua ry 11 th su bmi ssi on and the e arl ie r s tate me nt t hat a ll of Ag ro D u tc h ’ s U

. S. s a le s ar e ma d e w it h p ay me n t te r ms o f 9 0 d ay s . I t d id n o t a s k f o r further information re g ardingthe letter of cre d i t o r consig nments or commissions. From the fa ct that Com me rc e se nt o ut a seco nd supp le me nta l qu e sti onna ir e a t a ll, the c ourt c on c lud e s th a t it

is indication that the information soug ht amounted to the sum and substance of what Comm erc e reg arde d as the defic iency of Ag ro Dutch’s response (s) at that point in ti me, i.e. , th a t Co mme rc e did not reg ard the first supplemental questionnaire response as def icient as to the infor

mation provided the re in v ia

Ag ro Dutc h’ s e xplanatio n o f i ts c omm iss ion arr ang e me nts

.Court No. 02-00499 Pag e 20

Ag ro Dutc h’ s se c on d s up ple me nta l qu e sti onna ir e re sp on se appe ars to h a ve c omp lie d w ith the information reque sted insofar a s the information re quests wer e fr amed by Commerce.

“ De fi c ie nc y ” in 1 9 U .S. C. § 16 77 m( d) pr e sume s c lari ty in the or ig ina l qu e sti on a sk e d. Th e same is true with respe ct to a prope r dete rmination of “not satisfa ctory” re g ardinga re sponse to a defic iency

notice: t he propriety of t he determination depends upon the clar ity of the que stion asked. A complete answe r that is r esponsive to the question asked but whic h does not answe r the que stion Commerce ( err oneously

) assu m es i t had aske d cannot law fully be conside red the responde nt’s

“ d e f ic ie n c y ” o r a “ n o t s a ti s f

a c to r y ” r e me d ia l r e s p o n s e th ere to. C f

. Olympic A dhesive

s v. United States , 899 F.2d 1565 ( Fe d. Cir. 1990) (under prede cessor

statute t o facts otherwise available, a fa ilure to c omp ly

wi th a re qu e st f or inf or matio n mus t be eval uate d in the c on te xt of

the re qu e st befor e an a dverse infere nce ma y arise) . The re cord doe s not show, and C o m m er ce d o es not oth e rw ise su g g e st, that Ag ro Dutc h’ s sec on d s up ple me nta l qu e sti onna ir e re sp on se wa s in c omp le te or that Ag ro Dutch ha d been non- cooper ative with re spect to the que stions asked. The r ecor d there fore does not contain substantial evidence to support the c onclusion that Ag ro Dutch’ s second supplemental questionnaire response was “ not satisfactory” in ac corda nce w ith 1 9 U.S.C. § 1677m(d), and the matter must be re manded so that Commerc e may make a n acc urate deter

mination

on the re c or d w ithre sp e c t to it. C No ne the le ss, Com me rc e ma int a ins it did no t have a ll the inf or matio n it ne e de d to p ro pe rl y deter mine what th e ap p ro p riate date of sale should be or what pay ment date should be use d for calc ulating imputed c redit “unless it acc epted Ag ro Dutch’ s methodology .” See generally Re mandCourt No. 02-00499 Pag e 21

Re su lts (r ef er en ci n g inte r a lia I niti al Questionnaire Response §§ A at 10-12, CD at C-11, C-12, C-24). A findingthat a re spondent “w i t h h eld” information or “sig nificantly impeded” the p r o c e e d i n g n e c e s s ar i l y

p r e s u m e s t h a tC o m m e r c e w a s h i n d er ed fr o m o b t ai n i n g ne c e

ssa ry in f o r ma tion fo r t he re c or d and

tha t th e inf or matio n is missing

from the r ecor d. Quite simply , there must be a g ap in the rec ord t hat requires fill ing in or der to justify resor t to facts other

wise ava ilable. Information must therefor e be “ nece ssary” to and “ missing” f rom the proc eeding

in or der f or there to be a f

ailure on the par

t of a re spondent to comply with a re quest there for. See 19 U.S.C. § 1 6 7 7 e( a)

. The Statement of Administrative Ac tion accompa nying Pub.L . 103-465 states that “ [w] here a par ty has

no t c oo pe ra

te d, Com me rc e . . . may

e mpl oy a dv e rs e inf

e re nc e s about the missing infor mation to

ensure that th e p arty d o e s n o t o b ta in a mo r e f a v o r a b le r e s u lt b y f

a il in g to c o o p e r a te th an if it had cooper ated f

ully .” H.R. Doc . No. 103-316 (1994) at 870, as re pr inte d in 1994 U.S.C.C.A.N. 4040, 4199 (and a s italiciz ed in Gerbe r Food ( Y unnan) Co., Lt d. v. United States , 29 CI T ___, ___, 387 F.Supp.2d 1270, 1287-88 (2005) ). I n any event, a finding that a re spondent “withheld” information or “sig nificantly

impeded” the proce eding is subject to subsection m(d). Duri ngthe pr oc e e din g , Co mme rc e a sk e d c e rt a in q ue sti on s and

re c e ive d c e rt a in a

ns we rs to tho se qu e sti on s. I n part ic ula r, a s disc us se d, Com me rc e re c e ive d ap pa re ntl y c omp le te ans we rs to i ts fi na l su pp le me nta l qu e sti on na ire. Onc e a g a in, if Com me rc e ne e de d f

ur the r i nf or matio n, it c ou ld simply have asked for it, or substitut ed fac ts a vailable, but on this re cord, it ca nnot justi fiably

punt and then claim that Ag ro Dutch was responsible for the re cord’ s state. Cf

. China Ki ngdom , su

pra . I n the end, Commerc e mer ely implies that information is mi ssing f rom the record w ithout st ating

s p e c i f i c a l l y what

information was nece ssary to and missing fr om the rec ord. The Re ma nd Re su ltsCourt No. 02-00499 Pag e 22

mere ly state that complete inform ation conce rningAg ro Dutch’ s arr ang ement with Customer A, including a

n acc urate descr iption of the cre diting of sales to other c ustomers ag ainst Custom er A ’s

a dv anc e s, was nece ssa

ry fo r a pr op e r d e te rm inatio n o f t he date s o f s a le and

the date s o f p ay

me nt; howeve r, they

then state that Ag o Dutch’s disclosure of such infor mation (that other c ustomers pay Customer A for the purcha ses rather than Ag ro Dutch) cause d Commerce to wonde r whe ther Ag ro Dutch’s r elationship with Customer A was “equivale nt to affiliation”and to f urther spe culate a

bout the extent of Custom er A ’s involvement in the sales neg otiation proce ss with other customers in the United States – all of which “ require d further examination” in order to determine w hether those sales constituted EP or CEP sales beca use of Customer A’ s role as c ollection ag ent, commissionaire, a nd consig nee f

or some of A g ro Dutch’ s sales to other c ustomers. Se e Re ma nd Re su lts at 8-9. As pr e vio us ly no te d, Com me rc e ne ve r de te rm ine d whe the r Ag ro Dutc h’ s ar ra ng e me nt w ith Cus tom e r Aa mou

nte d to a “ lon g te rm

or mul ti- purc ha se a g re e me nt, ” bu t th e de te rm inatio n w ou ld

no t ha ve a ff e c te d A g ro Dutc h’ s c la im that a ll o f i ts s a le s w e re e xpor t pr ic e sa le s in any

e ve nt. F ur the r, Ag ro Dutc h state d that it wa s no t a ff ili a te d wi th Cus tom e r A, and it pr ovid ed ap pare ntl y complete responses to the questi ons asked in the se cond supplementa l questionnaire, includingthe explanation that some other customers paid Customer A for the ir purcha ses rather than A g ro Dutch. Commerce c hara cter izes thi s arr ang ement as invo l v i n g collection agency , but Ag ro Dutch w as alre ady in possession of the funds to which such a g ency purportedly perta ined. Whatever collection “ag ency” transpire d betwee n Customer A and Ag ro Dutch’ s other customer s would seem, insofar as this court ca

n discern, irreleva

nt to that circ umstance. More importantly , when a ll was said and done, Com me rc e its e lf

rec og nized that “the rec ord information does not support th[e] conclusion”Court No. 02-00499 Pag e 23

As a matter of l an gu age , substantial evidenc e would seem to be an 5 adequate expression of law. The difficulty comes a bout in the prac tice of ag encie s to rely

upon (and of courts to tacitly approve ) something le ss– to r e ly up on su sp ic ion , s ur

mi se, imp lic a tio ns , o r p la inl y inc re dib le e vid e nc e . I t w ill be the du ty of the c ourt s to de te rm ine in the fi na l ana ly sis and

in t he e xer c ise of

the ir ind e pe nd e nt j ud g me nt, wh e the r o n th e wh ole re c or d th e e viden ce in a g ive n in sta

nc e is suffic i ently

substantial to support a finding , conclusion, or other ag ency action as a

matter of la

w. Nippon Steel , 4 5 8 F

. 3 d

a t 1 3 5 1

- 5 2 ( qu o ti n g S. Re p . N o . 7 5 2 , 7 9 th Co n g . , 1 s t S e s s . 2 8 , 3 0

- 3 1 , as quoted in Universal Camera Corp. v. NLRB , 340 U.S. 474, 484 n.17 (1951)). that the sales should be treated as constructe d export price sales rather than e x port price sales. 67 Fe d. Reg . 46172 (I ssues and De cision Memorandum at cmt 2). Commerce cannot diso wn that

rec og nition and gr ound a final deter mination on the basis of m ere speculation – that the sales mig ht

rea lly be C EP sales – ostensibly substitut ing for fa cts otherwise available

. Cf. Ni ppon Steel Corp. v. United States , 458 F.3d 1345, 1351- 52 (F ed. Cir. 2006). Fur thermore , not only

do the Remand 5 Re su lts not state what is incom p l ete a bout Ag ro Dutch’ s responses to the que stions asked, they

e sse nti a lly

c on c e de that ne c e ssa

ry inf or matio n w a s not

m i s s i n g fr om t he re c or d w he n th e fi na l r e su lts

wer e issued. See , e.g. , Re ma nd Re su lts a t 13 (“ wi th re sp e c t to the Se t Z sa le s, Ag ro Dutc h w ith he ld information[, . . . and a]s with the S et X and [ Set] Y s ales, it was not until the [ second suppleme ntal qu e sti onna ir e re sp on se ] that Agro Dutch provide d the information ”) ( italics added)

. III Simi larly , the re cord is devoid of substantial evidence to support a n adver se infer ence in the selec tion of fac ts otherwise available pur suant to 19 U.S.C. § 1677e(b). The ability t o d ra w an adver se i n f

e r e n c e d e p e n d s u

p o n ( 1 ) th e n e c e s s it

y o f u s in g f

a c ts o th e r w is e a v a il a

b le an d (2) aCourt No. 02-00499 Pag e 24

Commerce ma

y not penalize a re spondent for a failure to respond in any

event. See , e.g. , 6 Fratelli De Cecco di Filippo Fara San Martino S.p.A. v. United States , 216 F.3d 1027, 1033 ( Fe d. Cir . 2 00 0) (C omm e rc e c ann ot imp os e an “ un jus tif ia bly hig h, punit ive ra

te ” purs ua

nt t o 1 9 U .S. C. § 1 67 7e (b ) t

hat ig no re s f

a c ts d isc ov e re d in

the c ours e of its ow n inve sti g a tio n)

. Com me rc e may on ly use an a dverse infere nce when re sort to fac ts otherwise available is r eq u ired. See , e.g. , Ta Chen Stainless Steel Pipe, Inc

. , 2 98 F .3 d at 13 40 (“ [i]t is c le ar . . . that [Con g re ss] i nte nd e d f or an a dv e rs e (continued...) responde nt’s behavior during the proce eding that led to such nec essity

. Cf. Ni ppon Steel Corp. v. United S tates , 3 37 F .3 d 1 37 3, 13 82 -8 3 ( F e d. Cir . 2 00 3) (f a ilure to f ull y re sp on d mu st b e du e to fa ilure e ith e r to ke e p an d mai nta in al l re qu ir e d re c or ds or to put fo rt h maximum e ff

or ts t o inve sti g a te

and ob ta in the re qu e ste d inf or matio n fr om r e c or ds ); NSK L td. v. United States , 28 CI T 1535, 1569- 70 , 3 46 F .S up p. 2d

13 12 , 1 34 2- 43 (2 00 4) (u ph old ingus e of

a dv e rs e inf

e re nc e a ft e r t

wo sp e c if ic reque sts for information in re sponse to which respondent NTN did not provide use able data), aff’d , 48 1 F. 3d 13 55 , 136 1 (F e d. Cir . 2 00 7) ; Mannesmannrohre n-W erkeAG v. U

nited States , 23 CI T 826, 83 9, 77 F .Su

pp .2 d 1 30 2, 13 13 -1 4 (1 99 9) (C omm e rc e mus t “ art ic ula te why it c on c lud e d th a t a

pa rt y failed to a ct to the best of its ability , an d ex p l ai n why the abse nce of

this information is of signific ance to the prog ress of its investig ation”) ( citation omitted). Here , Commerce has not jus tif ie d r e so rt to fa c ts oth e rw ise a va ila ble a s a re su lt of Ag ro Dutc h’ s re sp on se s, le t a lon e an a dv e rs e infere nce in the se lection there of. Mer e insuffic iency in a response or the mere absenc e of ne cessa ry inf or ma tio n o n th e re c or d is no t su ff ic ie nt t o s ho w that a

pa rt y ha s n ot c oo pe ra

te d to the be st o f i ts

a bil ity , Co mme rc e mus t po int to e vid e nce of reco rd de mon str a tin g “ c ir c ums tanc e s in wh ic h it is

rea sonable for

Commerce to e x pect that more forthcomingresponse s should have bee n made, i.e. , . . . circ umstan ce s in which it is reasona ble to conclude that less than full coope ration has be en

s h own.” Nippon Steel , 337 F.3d at 1382. Cf. Olympic Adhesiv es , su pra . F u rt h e r , t h e a dv e rs e 6Court No. 02-00499 Pag e 25

(...continued) 6 fa c ts a va ila

ble rate to be a re a so na

bly a c c ur a te e sti mate of

the re sp on de nt’ s a c tua l r a te , a lbe it w ith some built-in increa se intended a s a dete rre nt to non-compliance ”). inf e re nc e pr ov isi on , s ub se c tio n 1 67 7e (b) , is su bje c t to the a

pp lic a bil ity of the fa c ts- a va ila

ble pr ov isi on , su

bs e c tio n 16 77 e (a ), wh ic h in tur n is su bje c t to s ub se c tio n 1 67 7m( d) . H e nc e , it is o nly after a pp lic a tio n o f s ub se c tion 16 77 m( d) and , if a pp lic a ble , s ub se c tio n 1 67 7m( e ), that a det er m i nation of non-c ooperation could be made, but the r ecor d here does not support the de te rm inatio n that Ag ro Dutc h w a s n on -c oo pe rativ e wh e n th a t de te rm inatio n w a s ma de . T he on ly “withholding” of re cord w as obviated by the apparent c ompleteness of A g ro Dutch’ s response to the second suppleme ntal questionnaire. Conclu sion Th is m a tte r mus t a g a in b e re mand e d f or re de te rm inatio n o f A g ro Dutc h’ s a nti dumpi ngdu ty marg in in accor dance with this opi nion and based on the facts of record with respe ct t o the af fec ted

sa le s in vo lvi ngCus tom e r A . I f Com me rc e de te rm ine s that the re c or d e vid e nc e is no t su ff ic ie nt t o

answe r whether C ustomer A is aff iliated with Ag ro Dutch or to answer

the extent of Custom er A ’s supposed “involvement in the sales proce ss” of Ag ro Dutch’s sales to othe r custo m er s fo r which Customer A rec eived pa

y ment, then Commerce shall either r eopen the proce eding for the limit ed purpose of

obtaining satisfactory

answe rs to those questions, or it sha ll make its de termination on the basis of fa cts ava ilable without imputi ng an adve rse infe renc e on the re cord e vidence obtained thus far

. Commerce shall file t he results of this remand within forty day s of the date of this opinion;Court No. 02-00499 Pag e 26

all parties may

submit comments to the rema nd results within 15 day s of filing; and all parties may file re sponses to any

such comments within 10 day s after the submission t here of. SO OR DE RE D

. /s/ R. Kenton Musgra ve R. KENTON MUSGRAVE, SENI OR J UDGE Dated: Dec ember

26, 2007 New Y ork, Ne w York