19 U.S.C. 1581(c) - Judicial Review of Antidumping & Countervailing Duty Determinations Issued by the Department of Commerce

Article excerpt

I. INTRODUCTION

While the U.S. Court of International Trade ("CIT") decided many notable cases on novel legal issues in 2006, it also clarified the law on several traditional trade remedy issues regarding the administration of antidumping and countervailing duty laws by the U.S. Department of Commerce ("Commerce" or the "Department"). The Court addressed such important areas of the law as the use of adverse facts available ("AFA"), the legality of the Commerce Department's "zeroing" practice, and many other aspects of antidumping ("AD") and countervailing duty ("CVD") calculations. Additionally, the Court of Appeals for the Federal Circuit ("CAFC") overruled the CIT on several notable trade remedy subjects, often deferring to the methodology or determination of the Department.

II. ANTIDUMPING DUTY CASES

A. Notice

Generally, actions commenced at the agency or court level require the party bringing the action to notify other affected or potentially affected parties of the impending case. This due process requirement serves to inform parties of the potential need and opportunity to protect their legal rights.

In PAM, S.p.A. & JCM, Ltd. v United States, the U.S. Court of Appeals for the Federal Circuit ("CAFC") reviewed a judgment by the U.S. Court of International Trade ("CIT") regarding the notification and service requirements for a party requesting an administrative review pursuant to 19 C.F.R. [section] 351.303(f)(3)(ii). (1) Under this regulation, the party requesting the review "must serve a copy of the request by personal service or first class mail on each exporter or producer specified in the request and on the petitioner." (2) The CAFC held that a party's failure to strictly adhere to this regulation did not automatically mandate the rescission of an agency decision; rather, a party must prove that it was "substantially prejudiced" by the other party's failure to follow the regulation before it may be afforded such relief. (3)

The CIT determined that parties were required to "strictly comply" with the regulation, and that Commerce could not "relax or modify" it. (4) Because the parties had requested the administrative review, in this case domestic pasta producers failed to serve a foreign pasta exporter, PAM, S.p.A. ("PAM"), the CIT held that Commerce's final results for the administrative review as to PAM were void from the beginning. (5)

On appeal, the CAFC reversed the CIT's judgment and remanded the case for adjudication on the merits. (6) Citing the general principle that a court or administrative agency may relax or modify "procedural rules adopted for the orderly transaction of business before it when in a given case the ends of justice require it," (7) the CAFC held that a party must show that it was "substantially prejudiced" by the lack of service before an agency's actions or results may be rescinded. (8) As explained by the CAFC, it is illogical to rescind the final results of an administrative review solely because a party does not strictly adhere to a regulation if the other party was not prejudiced by the failure to act. (9) To do so would unnecessarily penalize the Government, the other parties, and the public. (10)

The CAFC further explained that judicial precedent does not require that regulations providing an "important procedural benefit" be exempt from a "substantial prejudice" analysis as claimed by PAM. (11) According to the Court, the cases that PAM relied on solely addressed situations where the courts had determined that the rule did not provide important procedural benefits or did not address the question at all. (12) Accordingly, the CAFC declined to determine whether 19 C.F.R. [section] 351.303(f)(3)(ii) provided an "important procedural benefit," and instead focused on the issue of whether PAM was substantially prejudiced by the domestic pasta producers' failure to serve notice of the request for an administrative review. …