Opinion ID: 813702
Heading Depth: 2
Heading Rank: 4

Heading: The AFA Data and Methodology

Text: I agree with Commerce that recalculating U.S. price was within the scope of the voluntary remand order. Nothing in the remand order limited Commerce only to recalculating the normal value when “examining . . . whether [it] corroborated the adverse facts available rate upon which it relied in calculating the separate rate.” See Changzhou Wujin Fine Chem. Factory Co. v. United v. United States, 582 F.3d 1336 (Fed. Cir. 2009); Ningbo Dafa Chem. Fiber Co. v. United States, 580 F.3d 1247 (Fed. Cir. 2009); Huvis Corp. v. United States, 570 F.3d 1347 (Fed. Cir. 2009); Ta Chen, 298 F.3d 1330. CHANGZHOU WUJIN v. US 8 States, No. 09-00216, 2010 Ct. Intl. Trade LEXIS 108, at -2 (Ct. Int'l Trade Feb. 8, 2010). After requesting a remand in the terms adopted verbatim by the Court of International Trade, Commerce further requested that “if the Court grants [Commerce’s] request for a partial remand, the Court allow Commerce . . . to examine the issues related to the adverse facts available rate, to make any necessary recalculations based on its examination, and to obtain comments from the parties.” Joint App’x at 1480, 1501. Appellant apparently did not challenge this request. Once Commerce determined that it could not corroborate the AFA rate, it had to calculate a new AFA rate for purposes of calculating appellant’s separate rate. Because AFA rates are based on the difference between the normal value and U.S. price, Commerce’s establishment of the AFA rate necessarily involved considering the continued viability of both normal value and U.S. price. See 19 U.S.C. § 1673e(a)(1). Commerce could no longer rely on uncorroborated secondary information for normal value and U.S. price. See 19 U.S.C. § 1677e(c). Thus, Commerce’s decision to establish a new U.S. price susceptible to corroboration was reasonable, well within its authority, and not contrary to law. Id. That no party challenged the U.S price prior to the remand is immaterial. Commerce acted within the remand’s scope when it recalculated U.S. price to arrive at a new AFA rate and a new separate rate for appellant. Nor did Commerce err in its recalculation of appellant’s separate rate. Generally, the separate rate is the weighted average of dumping margins established for entities individually investigated, excluding zero and de minimis margins, and margins determined entirely on the basis of AFA. 19 U.S.C. § 1673d(c)(5)(A). As in this case, 9 CHANGZHOU WUJIN v. US where dumping margins for all entities individually investigated are zero or de minimis or determined entirely on the basis of AFA, Commerce may use any reasonable method for establishing the separate rate for entities not individually investigated, including averaging the dumping margins of entities individually investigated. § 1673d(c)(5)(B). Throughout the investigation and on remand, Com- merce has consistently applied a methodology for calculating separate AFA rates whereby it averaged the dumping margins assigned to the entities that were individually investigated. Appellant has not challenged Commerce’s decision to use this methodology before the Court of International Trade, nor has it done so on this appeal. U.S. Appellee Br. at 33; Compass Appellee Br. at 9 n.2. The records shows that appellant has specifically endorsed this methodology, Joint App’x at 1571; 1582-83, and directs its challenge solely to Commerce’s decision to use BWA’s U.S. price in the AFA calculation.5 Stated differently, appellant challenges the data used, not the methodology employed. Appellant offers a host of reasons why it believes that Commerce’s decision to use the U.S. price of BWA, a single uncooperative respondent, in its AFA rate calculation was contrary to law. It argues that BWA’s U.S. price is an “extreme outlier” and does not reflect a “commercial 5 BWA was an uncooperative respondent, but it had submitted a Q&V questionnaire response early in the investigation. Based on its response, Commerce was able to determine the average unit value (value divided by quantity), which approximated the U.S. price of its merchandise during the period of investigation. CHANGZHOU WUJIN v. US 10 reality.”6 Appellant relies on Gallant Ocean (Thail.) Co. v. United States, 602 F.3d 1319 (Fed. Cir. 2010), where this court held that an AFA rate more than five times higher than the highest rate applied to a cooperating respondent was not supported by substantial evidence. 602 F.3d at 1324. Because nothing in the record in that case tied the AFA rate—derived from an adjusted petition rate—to Gallant, we concluded that the AFA rate was unrelated to commercial reality and not a reasonable accurate estimate of Gallant’s actual dumping, hence, not supported by substantial evidence. Id. Notably, we observed that “[t]he fact that Commerce ultimately imposed dumping margins between 5.91% and 6.82% for the same products after its initial investigation shows the possession of better information and shows that the adjusted petition rate was aberrational.” Id. at 1323-24. We counseled Commerce that it should have relied on representative dumping rates of similarly-sized and similarly-situated exporters, which could have provided a reasonable basis from which to calculate an appropriate AFA rate. Id. at 1324. Appellant’s reliance on Gallant Ocean is misplaced. First, although the AFA rate determined by Commerce in this case is arguably a multiple of the highest calculated rate, Appellant Br. at 37, the AFA rate was not applied to appellant directly, but rather was used to calculate a separate rate. It would be unreasonable to require such a rate to reflect a commercial reality of appellant. Compare Gallant Ocean, 602 F.3d at 1323-24 (reversing a 57.64% 6 The majority asserts that BWA’s data was not the best data on record. It does not, however, respond to the appellant’s arguments that BWA’s data should not have been used because it was “outlier” data. Whether BWA’s data was adequate is a question of fact that we review for substantial evidence. 11 CHANGZHOU WUJIN v. US AFA rate applied to Gallant because it had no grounding in Gallant’s commercial reality), with PAM, S.p.A. v. United States, 582 F.3d 1336, 1336, 1340 (Fed. Cir. 2009) (affirming a 45.49% AFA rate applied to PAM although only 0.5% of its U.S. sales were at that margin), and Ta Chen Stainless Steel Pipe, Inc. v. United States, 298 F.3d 1330, 1339 (Fed. Cir. 2002) (affirming a 30.95% AFA rate applied to Ta Chen although only 0.04% of its sales during the period of review were at that margin). Second, this court in Gallant Ocean held that “Commerce failed to corroborate the adjusted petition rate with ‘independent sources that are reasonably at [its] disposal.’” 602 F.3d at 1324 (alteration in original) (citing 19 U.S.C. § 1677e(c)). By contrast, Commerce in this case abandoned the petition rate on remand when it determined that it could no longer corroborate it. Since Commerce relied on “information obtained in the course of an investigation” on remand, it was not obligated to corroborate either BWA or Wujin Water’s data. See § 1677e(c). We have previously recognized that as long as the data is corroborated, or as here, does not require corroboration, “Commerce acts within its discretion when choosing which sources and facts it will rely on to support an adverse inference.” PAM, 582 F.3d at 1340 (quoting Ta Chen, 298 F.3d at 1339); see also F.Lli de Cecco Di Filippo Fara S. Martino S.p.A. v. United States, 216 F.3d 1027, 1032 (Fed. Cir. 2000) (“Commerce’s special expertise makes it the ‘master’ of the anti-dumping law, entitling its decisions to great deference from the courts.”). Finally, whereas Commerce “possess[ed] . . . better information” and “had abundant resources from which to calculate a reasonable AFA rate” in Gallant Ocean, 602 F.3d at 1323-24, any other combination of U.S. price data in this case, other than BWA’s alone, would have resulted CHANGZHOU WUJIN v. US 12 in a zero or de minimis dumping margin. Commerce wields the AFA rate to deter noncompliance with its investigations. de Cecco, 216 F.3d at 1032. This objective would be undermined if we compelled it to use de minimis AFA rates. As Commerce observed, [a]n AFA rate of zero [or de minimis] would not be sufficiently adverse as to effectuate the purpose of the facts available rule to induce respondents to provide the Department with complete and accu- rate information in a timely manner and would not ensure that uncooperative parties do not ob- tain a more favorable result by failing to cooperate than if they had had cooperated fully. Changzhou Wujin Fine Chemical Factory Co. v. United States, No. 09-00216, ECF No. 44, at 16 (Apr. 30, 2010) (Final Results of Redetermination Pursuant to Court Order). The circumstances of this case are distinct in that Commerce redetermined the AFA rate on remand solely for the purposes of determining appellant’s separate rate; the other non-cooperative respondents did not challenge, and thus were assigned, the AFA petition rate of 72.42%. Yet it remained within Commerce’s discretion to choose which sources and facts to rely on to support an adverse inference. See de Cecco, 216 F.3d at 1032. Appellant’s failure to challenge as unreasonable Commerce’s separate rate calculation methodology exposed it to the consequences flowing from Commerce’s discretion to select an AFA rate sufficiently adverse to effectuate the purposes of the statute. While Commerce’s discretion was not boundless, id., assigning an AFA rate of zero or de minimis would be contrary to the statutory objectives of the AFA rate. Indeed, if Commerce had used any of the alternative 13 CHANGZHOU WUJIN v. US data sources appellant advances in this appeal, a de minimis AFA rate would result. I therefore would hold that Commerce’s reliance on BWA’s data for U.S. price, and that the methodology it selected to calculate the separate rate for appellant was supported by substantial evidence and otherwise not contrary to law.