Shandong Rongxin Import & Export Co. v. United States

774 F. Supp. 2d 1307, 33 I.T.R.D. (BNA) 1438, 2011 Ct. Intl. Trade LEXIS 44, 2011 WL 1542651
United States Court of International Trade·Decided April 21, 2011·No. Slip Op. 11-45; Court 09-00316·Published·Cited by 21 cases

Opinion

Opinion & Order

CARMAN, Judge:

This action is before the Court following the final results of redetermination pursuant to remand (“Remand Results”), filed by the Department of Commerce (“Commerce”) on December 20, 2010. (ECF No. 43.) Plaintiff Shandong Rongxin Import & Export Company (“Shandong”) challenges *1309 the Remand Results only with respect to the value Commerce assigned to the wage rate factor of production in constructing the normal value of the subject merchandise. (Pl.’s Cmts. on Final Results of Re-determination Pursuant to Remand (“Pl.’s Cmts.”) at 1.) For the reasons set forth below, the Remand Results are sustained in part and remanded in part.

Background

In China First Pencil Co. v. United States, 34 CIT -, 721 F.Supp.2d 1369 (2010), the Court sustained-in-part and remanded-in-part Commerce’s final determination in the 2006-2007 administrative review of the antidumping duty order on Certain Cased Pencils from the People’s Republic of China (“PRC”). The above captioned case was consolidated -with China First shortly before the Court issued its opinion; after Commerce issued the Remand Results, Shandong was the only party seeking to challenge the Remand Results. Accordingly, the Court severed the cases and issued a judgment in China First Pencil Co. v. United States, Court No. 09-00325. Shandong now proceeds on its own.

Jurisdiction and Standard of Review

The Court has jurisdiction over this matter pursuant to 19 U.S.C. § 1516a(a)(2) and 28 U.S.C. § 1581(c). 1 By statute, when reviewing Commerce’s determination, the Court “shall hold unlawful any determination, finding, or conclusion found ... to be unsupported by substantial evidence on the record, or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(l)(B)(i); see also China First, 721 F.Supp.2d at 1372.

Discussion

In determining the dumping margin in this case, Commerce calculated the normal value of the subject merchandise on the basis of the values of certain factors of production in “a market economy country or countries considered to be appropriate by [Commerce].” 19 U.S.C. § 1677b(c)(1). The purpose of this statute is “to assess the price or costs of factors of production of [the subject merchandise in a surrogate market economy country,] in an attempt to construct a hypothetical market value of that product in [the nonmarket economy country].” Nation Ford Chem. Co. v. United States, 166 F.3d 1373, 1375 (Fed.Cir.1999) (internal quotations omitted). In deciding how to appropriately value factors of production, Commerce is required to “utilize, to the extent possible, the prices or costs of factors of production in one or more market economy countries that are— (A) at a level of economic development comparable to that of the nonmarket economy country, and (B) significant producers of comparable merchandise.” 19 U.S.C. § 1677b(c)(4). When Commerce elects to calculate normal value pursuant to this method, one of the factors of production for which it must establish a value is labor, or the wage rate. 19 U.S.C. § 1677b(c)(3).

In Dorbest Ltd. v. United States, 604 F.3d 1363, 1372 (Fed.Cir.2010), the Court of Appeals for the Federal Circuit (“CAFC”) invalidated the regulation in which Commerce had established its preferred method for valuing labor as a factor of production. The CAFC held that the agency’s regression-based methodology produced a value for labor that failed to utilize data only from countries that are at a level of economic development comparable to that of the nonmarket economy country, and that are significant producers of comparable merchandise, as required by 19 U.S.C. § 1677b(c)(4). See id. Because the final determination challenged in China First was issued prior to the CAFC *1310 decision in Dorbest, the Court remanded this case to Commerce with instructions to “adjust the surrogate value for labor to conform with the statutory requirements [of 19 U.S.C. § 1677b(c)(4) ], as explained in Dorbest.” China First, 721 F.Supp.2d at 1382. The value Commerce subsequently assigned to the wage rate is the only aspect of the Remand Results presently challenged by Shandong.

A. Commerce’s Wage Rate Determination on Remand

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Shandong Rongxin Import & Export Co. v. United States, 774 F. Supp. 2d 1307, 33 I.T.R.D. (BNA) 1438, 2011 Ct. Intl. Trade LEXIS 44, 2011 WL 1542651 (cit 2011).

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