Opinion ID: 3157928
Heading Depth: 3
Heading Rank: 2

Heading: Finding of Threat of Material Injury

Text: Commissioner Pinkert found that the domestic industry was threatened with material injury, applying the statutory factors for determining threat of injury: 19 U.S.C. § 2677(7)(F)(i). In determining whether an industry in the United States is threatened with material injury by reason of imports (or sales for importation) of the subject merchandise, the Commission shall consider, among other relevant economic factors: (I) if a countervailable subsidy is involved, such information as may be presented to it by the ad- ministering authority as to the nature of the sub- sidy (particularly as to whether the countervailable subsidy is a subsidy described in Article 3 or 6.1 of the Subsidies Agreement), and whether imports of the subject merchandise are likely to increase, (II) any existing unused production capacity or imminent, substantial increase in production capacity in the exporting country indicating the like- 8 SIEMENS ENERGY, INC. v. US lihood of substantially increased imports of the subject merchandise into the United States, tak- ing into account the availability of other export markets to absorb any additional exports, (III) a significant rate of increase of the volume or market penetration of imports of the subject mer- chandise indicating the likelihood of substantially increased imports, (IV) whether imports of the subject merchandise are entering at prices that are likely to have a significant depressing or suppressing effect on domestic prices, and are likely to increase demand for further imports, (V) inventories of the subject merchandise, […] (VIII) the actual and potential negative effects on the existing development and production efforts of the domestic industry, including efforts to develop a derivative or more advanced version of the do- mestic like product, and (IX) any other demonstrable adverse trends that indicate the probability that there is likely to be material injury by reason of imports (or sale for importation) of the subject merchandise (whether or not it is actually being imported at the time). Commissioner Pinkert found that the domestic industry was in a vulnerable condition toward the end of the period of investigation, as the wind tower imports grew in volume and market share. He found that the subject imports were 192.8 percent higher in interim 2012 compared with interim 2011, accompanied by substantial increase in market share. ITC Views at . He deemed it significant that the price gap between the subject imports and domestic wind towers diminished substanSIEMENS ENERGY, INC. v. US 9 tially over the period of investigation. He found that the producers in China and Vietnam had increased their capacity, and that they expected to increase their exports to the United States. He discussed the foreign producers’ increasing dependence on the United States market, in the context of only a moderate increase in United States demand in the near future. He observed that several domestic producers had ceased production or closed plants. Commissioner Pinkert found threat of “significant loss of revenues” and “declining employment, output, and productivity” in the imminent future, id. at , and concluded that the intensifying level of competition from the subject imports would be likely to threaten material injury to the domestic industry, which was already in a loss position. Id. Siemens states that Commissioner Pinkert’s finding of threat of material injury was weak and poorly supported, and should not receive equal weight with the findings of no injury. Siemens states that the finding of threat of injury was based on a perceived downward pricing trend that did not exist. The government characterizes this argument as a misstatement, because Commissioner Pinkert cited the increasing price trend and the shrinking price gap between the imports and the domestic product, and recognized that the domestic industry was under price pressure from the imports and was operating at a loss that was increasing. Review of the record and argument shows that there was substantial evidence in support of Commissioner Pinkert’s conclusion of threat of material injury. The Court of International Trade correctly sustained this finding.