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CIT Upholds Commerce Findings In Part Of Tire Duty Row

U.S. Court International Trade CIT Chinese tires

The U.S. Court of International Trade on Wednesday found against challenges to several aspects of the Commerce Department's findings in part of a countervailing duty investigation into Chinese imports of certain tires.

CIT Judge Jane A. Restani sustained determinations that the U.S. Department of Commerce made after the court previously asked the agency to address several issues raised in a case challenging countervailing duties on certain pneumatic off-the-road tires imported from China. The CIT case, which traces back to 2008, was initially lodged by the Chinese company GPX International Tire Corp. and was later consolidated with other cases, including one brought by Tianjin United Tire & Rubber International Co. Ltd.

In Wednesday's ruling, Judge Restani shot down challenges to certain aspects of a Commerce remand determination. Among other rulings, the judge found against challenges to Commerce's findings regarding an asset sale involving a GPX affiliate, as well as challenges to Commerce's findings that Tianjin had certain loans forgiven, something the agency took into consideration when determining the subsidies from which Tianjin allegedly benefited.

“When taken as a whole, the evidence on the record provided sufficient support for Commerce’s determination that governmental subsidization occurred,” the judge said in her finding against Tianjin's challenge. “Accordingly, the court sustains Commerce’s determination.”

The remand results upheld in Wednesday's ruling were issued by Commerce in mid-April, after Judge Restani had, on Jan. 7, issued another ruling in the case.

In the January ruling, the judge held that a recent law — passed following a Federal Circuit ruling restricted  Commerce's ability to collect countervailing duties on imports from nonmarket economies like China — did not violate several provisions of the U.S. Constitution.

The contested law was passed in March 2012, after the Federal Circuit affirmed a CIT determination that double-counting may occur when both countervailing and anti-dumping duties are imposed on goods from nonmarket economy countries, which are subject to a special methodology for calculating dumping margins, according to Judge Restani.

The law's reach stretches back to November 2006, and while it contains a provision meant to address possible double-counting, those adjustments were only applied going forward, to determinations made after March 13, 2012, the judge said. 

Both GPX and Tianjin had argued that the law contained retroactive provisions that infringed their constitutional rights to equal protection. GPX also raised other challenges, citing the Constitution's due process and ex post facto clauses. But, in January, Judge Restani shot down each argument in turn.

At the time, however, the CIT judge also found some lingering issues with Commerce's calculation of the countervailing duties. She remanded Commerce's duty determinations back to the agency for further review, according to the January decision.

Wednesday's ruling from Judge Restani sustains the results of Commerce's remand determination, which addressed issues the CIT judge had pointed to in January.

An attorney for GPX did not immediately respond to a request for comment on Wednesday evening, while a representative for Tianjin was not immediately available.

GPX is represented by William H. Barringer, Daniel L. Porter, James P. Durling, Matthew P. McCullough and Ross E. Bidlingmaier of Curtis Mallet-Prevost Colt & Mosle LLP.

Tianjin is represented by Mark B. Lehnardt of Lehnardt & Lehnardt LLC.

The case is GPX International Tire Corp. et al. v. United States, case No. 1:08-cv-00285, in the U.S. Court of International Trade.