Source: https://case-law.vlex.com/vid/159-f-supp-2d-604364066
Timestamp: 2019-04-19 08:52:59+00:00

Document:
Skadden, Arps, Slate, Meagher & Flom LLP (Robert E. Lighthizer, John J. Mangan, Ellen J. Schneider, Stephen J. Narkin, and Worth S. Anderson) and Dewey Ballantine LLP (Alan Wm. Wolff and Michael H. Stein), for Plaintiffs.
Stuart E. Schiffer, Acting Assistant Attorney General; David M. Cohen, Director, Commercial Litigation Branch, Civil Division, U.S. Department of Justice; Lucius B. Lau, Attorney, Commercial Litigation Branch, Civil Division, U.S. Department of Justice; Terrence J. McCartin, Senior Attorney, Office of the Chief Counsel for Import Administration, U.S. Department of Commerce, for Defendant, of counsel.
Willkie Farr & Gallagher (Christopher A. Dunn, Christopher S. Stokes, Robert L. LaFrankie, and Karl von Schriltz), for Defendant-Intervenors.
This action challenges a July 1999 agreement between the U.S. Department of Commerce ("Commerce") and the Government of Brazil, suspending at the eleventh hour the investigation into alleged countervailable subsidies received by three Brazilian steel exporters ("Brazilian Exporters") 1 from the Brazilian Government. See Certain Hot-Rolled Flat-Rolled Carbon-Quality Steel Products From Brazil, 64 Fed. Reg. 38,797 (Dept. Commerce 1999) (suspension of countervailing duty investigation and entry of suspension agreement) (Public Administrative Record Document ("P.R. Doc.") No. 173) ("Suspension Determination" or "Suspension Agreement" or "Agreement"). 2 That investigation was initiated at the behest of, among others, the plaintiff domestic steel producers here ("Domestic Producers"). 3 See Certain Hot-Rolled Flat-Rolled Carbon-Quality Steel Products From Brazil, 63 Fed. Reg. 56,623 (Dep't Commerce 1998) (initiation of countervailing duty investigation) (P.R. Doc. No. 33).
The law on suspension agreements requires, among other things, that Commerce afford the domestic industry the opportunity to review and comment on any proposed agreement. 19 U.S.C. § 1671c(e) (1994). The Domestic Producers here argue that "there is no indication that anyone at the Department read [their comments]. Indeed, there is substantial evidence that they did not." See Plaintiffs' Reply Brief in Support of Motion for Judgment Under Rule 56.2 ("Reply Memo") at 35. The Domestic Producers further assert that, under the facts of this case, Commerce cannot make the substantive determinations required to justify the Suspension Agreement. Id. passim.
The suspension agreement provisions of the Act were adopted to impose "strict limits on discontinuing or suspending investigations pursuant to deals with foreign governments or producers." 125 Cong. Rec. 20,163 (1979). The provisions on suspension of countervailing duty investigations effected "a major change in ... [the then-existing] law," eliminating waiver authority and instead "authorizing the suspension of investigations based on agreements with the exporters or the government of the country in which the subsidy practice is alleged to occur." H. Rep. No. 96-317 (1979) at 53.
investigations [is to] be exercised within the carefully circumscribed limits" set forth in the law. H. Rep. No. 96-317 at 53-54; see also S. Rep. No. 96-249 at 54, 1979 U.S.C.C.A.N. at 440 (to ensure that suspension agreements are used only in those cases where they "serve the interest of the public and the domestic industry affected," agency authority to suspend investigations is "narrowly circumscribed"); 125 Cong. Rec. 20,168-69 (1979) (Senator Heinz's understanding that suspension agreements permitted only "under certain narrowly constrained circumstances" confirmed by bill managers Senators Ribicoff and Roth). Congress further cautioned that "suspension is an unusual action which should not become the normal means of disposing of [countervailing duty] cases." S. Rep. No. 96-249 at 54, 1979 U.S.C.C.A.N. at 440.
There are essentially two distinct types of suspension agreements in countervailing duty cases--so-called "subsection (b) agreements" and "subsection (c) agreements." Subsection (b) agreements eliminate or offset completely a countervailable subsidy, or cease exports of the subject merchandise. 19 U.S.C. § 1671c(b). In contrast, subsection (c) agreements do not cease exports; nor do they completely eliminate or offset countervailable subsidies. Rather, they eliminate only the exports' injurious effect. 19 U.S.C. § 1671c(c).
Prior to accepting either a subsection (b) or (c) agreement, Commerce must find both that "suspension of the investigation is in the public interest," and that "effective monitoring of the agreement by the United States is practicable." 19 U.S.C. § 1671c(d). Commerce also is required to notify petitioners of, and consult with them concerning, its intention to suspend the investigation. In addition, Commerce must provide petitioners with a copy of the proposed agreement, and accord them an opportunity to comment. 19 U.S.C. § 1671c(e).
But there are additional requirements for subsection (c) agreements. Because such agreements, by definition, allow some subsidy practices to continue, Congress restricted subsection (c) agreements to cases involving "extraordinary circumstances"--cases where the suspension of the investigation is more beneficial to the domestic industry than its continuation, and where the investigation is "complex." See S.Rep. No. 96-249 at 51 (discussing the extraordinary circumstances requirement set out in 19 U.S.C. § 1671c(c)(4)).

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