Court Opinion

ID: 9488492
Source: CourtListenerOpinion
Date Created: 2023-08-05 12:47:12.603664+00
Date Added: 2024-06-11T17:52:55.527163
License: Public Domain

CLEVENGER, Circuit Judge,
dissenting.
This case involves a countervailing duty order issued in 1982, at a time when Mexico was not a “country under the Agreement”, and hence at time when the products at issue here, dutiable ceramic tile, were lawfully subjected to countervailing duties without any injury determination having been made. Mexico became a “country under the Agreement” in 1985. As a result of an administrative review of calendar 1986, which did not include an injury determination for the review period, Customs assessed countervailing duties against Cerámica under the 1982 order.
The court holds that the United States— absent an injury determination — may not levy and collect these countervailing duties, even though assessed pursuant to a valid countervailing duty order. I read the court to say that it reaches this conclusion under the plain meaning of two statutes, 19 U.S.C. §§ 1303 and 1671. The authority to levy countervailing duties without making injury determinations ceases on the day a country becomes one “under the Agreement”, for exports made after that date. The only authority under which dutiable imports from Agreement countries can be subjected to countervailing duties is then found in section 1671. Since section 1671 speaks only of duties that “shall be imposed” after, inter alia, an injury determination is made, and does not distinguish between countervailing duties imposed for the first time under a section 1671 countervailing duty order and duties imposed as a result of administrative reviews of a section 1303 order which conclude that duties under the original order must be continued, the court concludes that any countervailing duty imposed on exports from an Agreement country is a section 1671 duty. Without saying so explicitly, the court decides as a matter of statutory construction that the word “imposed” in section 1671 means imposed in any fashion on imports made after a country becomes an Agreement country, as opposed to imposed by an initial countervailing duty order issued after a country becomes an Agreement country, pursuant to all the requirements of section 1671.
*1584The court’s result seems to make eminent good sense, but it is in tension with the history of the statutes, which includes the transition statute mentioned in passing by the court. The court’s failure to come to grips with the meaning and purpose of the transition statute is for me its Achilles’ heel.
When Congress enacted section 1671 in 1979, there were many outstanding countervailing duty orders affecting imports from many countries. At the same time, the United States was eager to encourage countries not yet acceding to the Subsidies Code (mentioned by the court) to do so promptly, either directly or by Agreement with the United States, so as to entitle dutiable imports from their countries to the benefit of injury determinations before imposition of countervailing duties by the United States. As an inducement to that end, Congress wrote transition rules in section 104(b) of the 1979 Act, which affected outstanding countervailing duty orders. Those statutory transition rules provided that if a country became an Agreement country before January 1, 1980, its government, and in some limited circumstances even its exporters, could request that an injury determination be made on countervailing duty orders issued before January 1, 1980. The request could be made within three years after the effective date of the 1979 Act, and if the injury determination was negative, then the countervailing duty order would be revoked and no countervailing duties would be collected from the date of receipt of the request. 93 Stat. 191-92. Of course, the transition statute does not apply to this case, which involves a post January 1, 1980, countervailing duty order. But whether the transition statute applies to this case is not the question. The question is whether the transition statute teaches us that the court’s interpretation of sections 1303 and 1671 is incorrect.
The transition rule statute on its face demonstrates that Congress had its eye on the situation presented by this case, and indeed sought to use the threat of continuation of duties levied under orders lacking injury determinations to nudge countries into the GATT fold. Beyond the face of the statute, its legislative history speaks directly to the matter at hand: “Selective application of section [1671] is intended to encourage countries to assume the obligations of the agree-ment_” S.Rep. No. 249, 96th Cong., 1st Sess. 45 (1979) U.S.C.C.A.N. 1979, pp. 381, 431.
The court’s holding in this case nullifies this aspect of the statutory transition rules. Under the court’s holding, there is no need for a new Agreement country to request an injury determination within three years after becoming a signatory country, because the preexisting countervailing duty order becomes unenforceable immediately upon signing an Agreement, and remains so until the United States initiates and completes a new investigation under section 1671. In addition to the nullification of a statute, the court’s holding further concludes that the statute nullified was itself unlawful, since it mistakenly conditioned the right to an injury determination, when Congress in the same statute in 1979 enacted the unconditional right to an injury determination. In my view, the court double faults at match point on the transition statute.
In fairness to the court and Ceramica’s brief, however, another reading of the effect of the transition statute is possible. Section 104(c) of the transition rules, 93 Stat. 192, provided that existing orders would remain in effect and thus avoid being declared inoperable. According to Cerámica, this transition provision was necessary to validate preexisting countervailing duty orders that would have been inoperative on this court’s reasoning in this case. To its credit, however, Cerámica concedes the softness of its argument by noting that, under the transition rules, exporters whose countries did not request injury determinations would be left exposed to imposition of duties under the old-non-injury-determination orders.
I thus have problems with the court’s holding. I think that the meaning of the two statutes themselves leaves uncertain whether every countervailing duty imposed on entries after a country signs an Agreement, in the circumstances of this case, is a duty “imposed” under section 1671, as opposed to a duty levied under a preexisting Section 1303 lawful countervailing duty order. Given *1585some ambiguity in the statutes themselves, fuelled quite considerably by the nullification of another statute to reach the court’s conclusion, I would conclude that the government retains the right to levy under old countervailing duty orders, without making injury determinations, in the factual circumstances of this case. Were I writing for the court instead of for myself, I would lay out the Chevron doctrine, and explain why this is an apt case for its application, given the failure of Congress to have directly answered the question at bar in the statute, and the expertise and authority of the particular administrative agency to fill in the legislative gap, especially when so well guided by the history of the statutes involved.
Although I find fault with the court’s decision in this case, I am unable to determine if this ease matters much to the government. I assume that we will hear from the United States by way of a petition for rehearing if recent developments under GATT will be severely compromised by this decision, or if the consequences to the fisc or our international relations will be significantly impaired by our holding. As yet, we have no signal that this is anything more than a garden variety case of statutory interpretation, in which one judge parts company respectfully with two respected colleagues.