Colakoglu Metalurji A.S. v. United States

553 F.Supp.3d 1344

COLAKOGLU METALURJI A.S. and Colakoglu Dis Ticaret A.S., Plaintiffs,

v. UNITED STATES, Defendant,andRebar Trade Action Coalition, Defendant-Intervenor.

Slip Op. 21-161

Court No. 20-00153

United States Court of International Trade.

December 2, 2021

Jessica R. DiPietro, Arent Fox, LLP, of Washington, D.C. argued for Plaintiffs. Also on the brief was Matthew M. Nolan.

Ann C. Motto, Trial Attorney, Civil Division, Commercial Litigation Branch, U.S. Department of Justice, of Washington, D.C. argued for Defendant. Also on the brief were Brian M. Boynton, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and L. Misha Preheim, Assistant Director. Of counsel on the brief was Reza Karamloo, Senior Counsel, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S. Department of Commerce, of Washington, D.C.

Maureen E. Thorson, Wiley Rein LLP, of Washington, D.C. argued for Defendant-Intervenor. Also on the brief were Alan H. Price and John R. Shane.

OPINION

Kelly, Judge:

Before the court is plaintiffs Çolakoglu Metalurji A.S.’s and Çolakoglu Dis Ticaret A.S.’s (collectively, "Çolakoglu") motion for judgment on the agency record pursuant to U.S. Court of International Trade Rule 56.2. [Çolakoglu's] Mot. for J. on Agency R., Jan. 26, 2021, ECF No. 22-1 ("PI. Mot."); see also [Pl. Mot.] and Memo. of Law in Supp. of [Pl. Mot.], Jan. 26, 2021, ECF No. 22 ("PI. Br."). Çolakoglu asks the court to reject the U.S. Department of Commerce's ("Commerce") imposition of a countervailing duty ("CVD") on Çolakoglu pursuant to Commerce's final results of its fourth administrative review of Steel Concrete Reinforcing Bar From the Republic of Turkey, 79 Fed. Reg. 65,926 (Dep't of Commerce Nov. 6, 2014) ([CVD] order) ("Rebar from Turkey"). Pl. Br. at 2, 10; see also Steel Concrete Reinforcing Bar from the Republic of Turkey. 85 Fed. Reg. 42,353 (Dep't of Commerce July 14, 2020) (final results and partial rescission of [CVD] admin. review; 2017), PD138,¹ ECF No. 19-4 ("Final Results"), and accompanying Issues and Decision Memo., C-489-819 (July 6, 2020), PD135, ECF No. 19-3 ("Final Decision Memo").

Specifically, Çolakoglu argues that Commerce's decision to pull forward Çolakoglu's CVD rate from Commerce's prior administrative review was contrary to law in that, according to Çolakoglu, Commerce was obligated to calculate Çolakoglu's rate by averaging the de minimis rates of the two mandatory respondents. Pl. Br. at 5-8; see also Reply Br. of [Çolakoglu], 2-6, June 16, 2021, ECF No. 27 ("Reply Br."). Çolakoglu further asserts that its rate is unsupported by substantial evidence because the record lacks any information that would support the imposition of its rate. Pl. Br. at 8-10; Reply Br. at 6-9.

Defendant United States and Defendant-Intervenor Rebar Trade Action Coalition ("RTAC") oppose the motion on the grounds that Commerce could use any reasonable method to calculate Çolakoglu's rate, averaging the mandatory respondents’ de minimis rates would not have been reasonably reflective of Çolakoglu's actual rate, and Commerce followed its past practice in pulling Çolakoglu's rate forward from the prior administrative review. See Def.’s Resp. to [Pl. Mot.], 5-12, May 12, 2021, ECF No. 25 ("Def. Br."); [RTAC's] Resp. Br., 7-11, May 13, 2021, ECF No. 26 ("RTAC Br."). Defendant further argues that Çolakoglu's rate is supported by substantial evidence because Çolakoglu previously availed itself of a subsidy program in the prior administrative review and offers no evidence that it has stopped using that program. Def. Br. at 12-13; see also RTAC Br. at 11-13.

For the following reasons, Commerce's Final Results are sustained.

BACKGROUND

Commerce published a CVD order covering steel concrete reinforcing bar ("rebar") from the Republic of Turkey ("Turkey") on November 6, 2014. See Rebar from Turkey. Commerce administratively reviewed Rebar from Turkey on an annual basis for the years 2014, 2015, and 2016 prior to initiating the fourth administrative review, which is the subject of this action. See [Rebar] from [Turkey], 82 Fed. Reg. 26,907 (Dep't of Commerce June 12, 2017) (final results and partial rescission of [CVD] admin, review; 2014) ("2014 Final Results") and accompanying Issues and Decision Memo., C-489-819, bar code 3578880-01 ("2014 IDM"); [Rebar] from [Turkey]. 83 Fed. Reg. 16,051 (Dep't of Commerce April 13, 2018) (final results and partial rescission of [CVD] admin, review; 2015) ("2015 Final Results" ) and accompanying Issues and Decision Memo., C-489-819, bar code 3692588-01 ("2015 IDM"); [Rebar] from [Turkey]. 84 Fed. Reg. 36,051 (Dep't of Commerce July 26, 2019) (final results and partial rescission of [CVD] admin, review; 2016) ("2016 Final Results") and accompanying Issues and Decision Memo., C-489-819, bar code 3866067-01 ("2016 IDM"); see also Final Results.

In two of three prior administrative reviews, Commerce selected Çolakoglu as a mandatory respondent, but did not select it as a mandatory respondent in the fourth administrative review. See 2014 Final Results, 82 Fed. Reg. at 26,908 (Çolakoglu not selected as mandatory respondent); 2015 Final Results, 83 Fed. Reg. at 16,051 -52 (Çolakoglu selected as mandatory respondent); 2016 Final Results, 84 Fed. Reg. at 36,051 (Çolakoglu selected as mandatory respondent); Memo. from C. Monks to E. Yang re: [Rebar] from [Turkey]: Respondent Selection in [CVD] Admin. Review for 2017, 1-3, PD28, CD4, bar codes 3830692-01, 3830691-01 (May 7, 2019) ("Respondent Selection Memo"). In both the 2014 and 2015 administrative reviews of Rebar from Turkey. Çolakoglu received de minimis rates. See 2014 Final Results, 82 Fed. Reg. at 26,908 ; 2015 Final Results, 83 Fed. Reg. at 16,051 -53. In the 2014 adminsitrative review, Commerce assigned all non-selected respondents de minimis rates because all mandatory respondents received de minimis rates. 2014 Final Results, 82 Fed. Reg. at 26,908 -09. In the 2015 administrative review, Commerce determined that Çolakoglu purchased natural gas from Born Hatlan Ile Petrol Tasima A.S. ("BOTAS"), a state-run company through which the Turkish government provides subsidies to Turkish companies by selling natural gas for less than adequate remuneration ("LTAR"). 2015 Final Results; 2015 IDM at 5; see also Final Decision Memo at 13, 35. However, Commerce determined that Çolakoglu paid market rates and thus was not subject to countervailing duties.

2015 Final Results; 2015 IDM at 5, 15. In the 2016 administrative review, Commerce again found that Çlakoglu purchased natural gas from BOTAS, but also determined that Çolakoglu purchased the gas for LTAR. 2016 Final Results; 2016 IDM at 8. Therefore, Commerce assigned Çolakoglu a 1.82% CVD rate for the 2016 administrative review. 2016 Final Results, 84 Fed. Reg. at 36,052.

Çolakoglu now brings this challenge to the Final Results of the fourth administrative review of Rebar from Turkey, which covers the period of January 1, 2017 through December 31, 2017 (the "POR"). Pl. Br. at 1; see also Final Results, 85 Fed. Reg. at 42,353. Çolakoglu, which was not selected as a mandatory respondent, specifically challenges Commerce's decision to assign to Çolakoglu a 1.82% subsidy rate when both examined respondents received de minimis rates. Pl. Br. at 3-4, 8-9; Final Results, 85 Fed Reg. at 42,355. Commerce calculated Çolakoglu's rate by pulling forward Çolakoglu's rate from the 2016 administrative review. Final Decision Memo at 4. However, Çolakoglu argues that the statutory scheme precludes Commerce from pulling forward Çolakoglu's prior rate, and that there is no record evidence to support the 1.82% rate because Çolakoglu was not selected as a mandatory respondent and thus the record is devoid of any company-specific information to support Çolakoglu's rate. Pl. Br. at 8-10; Reply Br. at 6-7. For the following reasons, Commerce's decision to assign Çolakoglu a 1.82% CVD rate is sustained.

JURISDICTION AND STANDARD OF REVIEW

This court has jurisdiction pursuant to section 516A of the Tariff Act of 1930, as amended, 19 U.S.C. § 1516a(a)(2)(B)(iii) (2018),² and 28 U.S.C. § 1581(c) (2018), which grant the court authority to review actions contesting the final determination in an administrative review of a CVD order. The court will uphold Commerce's determination unless it is "unsupported by substantial evidence on the record, or otherwise not in accordance with law." 19 U.S.C. § 1516a(b)(l)(B)(i).

DISCUSSION

There are two issues before the court. First, Çolakoglu contends that Commerce acted contrary to law by assigning Çolakoglu a 1.82% CVD rate because Commerce was obligated to calculate its rate pursuant to the so-called "expected method" set forth in the Uruguay Round Agreements Act, Statement of Administrative Action, H.R. Doc. No. 103-316, vol. I, at 873 (1994), reprinted in 1994 U.S.C.C.A.N. 4040, 4201 ("SAA"). See PI. Br. at 7. Second, Çolakoglu asserts that even if Commerce did not err as a matter of law, the 1.82% CVD rate is not supported by substantial evidence on the record. Id. at 9. Defendant and RTAC each argue that Çolakoglu misinterprets the relevant law, that the expected method is only presumed in the context of antidumping duty ("ADD") investigations, and that the statute empowers Commerce to use any reasonable method to calculate Çolakoglu's rate. Def. Br. at 6-12; RTAC Br. at 7-11. Defendant and RTAC further argue that Commerce reasonably chose not to use the ADD expected method in calculating Çolakoglu's rate because the mandatory respondents’ rates were not reasonably representative of Çolakoglu's experience in light of Çolakoglu's history of purchasing gas from BOTAS for LTAR. Def. Br. at 11; RTAC Br. at 11. Finally, Defendant and RTAC argue that Commerce's rate for Çolakoglu is supported by substantial evidence because it is based on the 2016 Final Results. Def. Br. at 12-13; RTAC Br. at 11-13.

I. Commerce's Methodology

In a CVD administrative review, Commerce generally...