Saturday, September 8, 2012

Surprise! Another Challenge to CVD/NME Law's Constitutionality

Over the last year, I've been chronicling the ongoing legal drama surrounding the US law that retroactively authorizes the US Department of Commerce to apply countervailing duties on imports from "non-market economies" like China and Vietnam.  Most of that drama has centered on the court case that first led to the CVD/NME law's implementation (GPX Int'l Tire Corp. v. United States) in which the Court of Appeals for the Federal Circuit (i) first held that DOC had no authority to impose CVDs on NME imports during the previous 5 years, and then - after Congress hopped in its Legal Time Machine(TM) and magically produced that authority - remanded the case to the Court of International Trade for a review of the CVD/NME law's constitutionality.  Three Chinese companies are making their case before the CIT right now, and you can read more about their arguments here and here.

Now, the US-China Trade Law blog has discovered another CIT challenge to the CVD/NME law's constitutionality.  After re-hashing the GPX case, they note:
[A] fourth Chinese company, Beijing Tianhai Industry Co., Ltd., made the same argument in the complaints it filed on August 20 , challenging the Commerce Department’s final affirmative determinations in the antidumping and countervailing duty investigations of High Pressure Steel Cylinders from China. However, Tianhai challenged the constitutionality of the March 13 law in the antidumping case, as well as in the countervialing [sic] duty case because the March 13 law calls for Commerce to make adjustments for double counting in the companion antidumping case, rather than in the countervailing duty case.
Tianhai's complaint is available here, if you're interested.  The constitutional challenge is briefly stated in Count One, and - like one of the claims made by Tianhai's GPX counterparts - is based on a violation of the Due Process Clause of the 5th Amendment:
The new law violates equal protection of the law as guaranteed by the Fifth Amendment's due process clause. Section 1(b) of Pub. L. No. 112-99 establishes a special rule that creates a particular class of parties to whom both antidumping and countervailing duties may be retroactively imposed without the protections Congress recognized as necessary under Section 2 of the same Act to account for potential double counting, protections that only apply prospectively.
Briefing in this case will occur in the coming weeks, and hopefully we'll be able to snag a copy of the arguments.  I'm not sure how different those arguments will be from GPX, but, more importantly, I'm now left wondering just how many more of these "copycat" challenges we'll be seeing at the CIT in the next few months.  As I've repeatedly noted, there are dozens of AD/CVD orders affected by the CVD/NME law - basically every AD/CVD investigation of Chinese or Vietnamese imports initiated between November 20, 2006 and March 13, 2012 (including the big solar panels case) - worth billions of dollars in annual trade.  Given this fact, and the fact that the CIT likely won't rule in the GPX case for a while, there seems to be little doubt that more cases like Beijing Tianhai are on the way.

No comments: