iOn May 16, 2024, U.S. producers filed antidumping (AD) and countervailing duty (CVD) petitions against imports of disposable aluminum containers, pans, and trays from China claimed to be (a) dumped – i.e., sold into the United States at less than fair/normal value prices and (b) government subsidized. The petition alleges dumping import duty margins of 104.5% to 287.8%, as a percent of import value. US AD import duties are requested for those amounts. No specific claimed subsidy CVD import duty margins.
For market economies, fair/normal value is the home market or third-country price, or actual cost, plus a reasonable profit, of the foreign producer/exporter. For deemed non-market economies, such as China, fair/normal value is a constructed cost, plus deemed reasonable profit, based on surrogate values in a market economy said to be at a comparable level of economic development to China.
Offsetting US AD/CVD import duties are imposed on China imports if (a) the US Department of Commerce (DOC) finds dumping or subsidies based on responses to DOC questionnaires (and DOC verification audit thereof) by the accused foreign exporters/producers (or their failure to participate), and (b) the US International Trade Commission (ITC) finds that there is material injury (or threat thereof) to a US industry because of the dumped or subsidized imports.
See the below Addendum for the product covered by the AD/CVD petition.
The most immediate deadlines are in the ITC preliminary injury investigation:
- May 20, 2024: ITC questionnaires issued
- May 30, 2024: Questionnaire responses due (short extension possible)
- June 6, 2024: ITC preliminary staff conference (witness testimony)
- June 11, 2024: Written comments to ITC
- June 28, 2024:ITC preliminary injury decision
See ITC website Investigation | USITC Investigations (ITC Investigation No. 701-727) for more, including questionnaires and the petition.
Generally, the ITC finds sufficient indicia of injury to a US industry from the accused imports at this preliminary stage to continue the AD/CVD investigation (i.e., not end it). If so, then the investigation moves to DOC.
The ITC threshold to find injury at this preliminary stage is low. Still, participation in ITC preliminary injury investigation can lay the factual foundation for a later final negative ITC injury decision, ending the case, which happens 30%-50% of the time (varies over time). It is critical not to make statements in the rushed ITC preliminary injury stage that have the potential to negatively impact the final stage.
Some AD/CVD petitions on their face indicate ITC injury issues, giving hope for a negative ITC injury decision. This petition does not. At least from the petition, it is a textbook case where injury is found. Of course, there may be other facts not in the petition.
The DOC preliminary CVD subsidy decision is on or around August 9, 2024. But this date is generally extended 65 days (to about October 13, 2024) if an investigated foreign producer/exporter participates at DOC, fully and accurately answering DOC questionnaires as to the extent (if any) of subsidies. Then the exporter can get a subsidy CVD import duty margin based on the actual extent of any received subsidies (assuming it also survives a later rigorous DOC audit of its questionnaire responses at its offices). In contrast, failure to so participate means a high, adverse DOC CVD import duty.
All events at DOC, including the petition, appear at https://access.trade.gov/login.aspx (Inv. Nos. A-570-170; C-570-171).
The DOC preliminary AD decision is about October 23, 2024. But this date, too, is generally extended 50 days (to about December 12, 2024) if an investigated foreign producer/exporter participates at DOC, fully and accurately answering DOC questionnaires as to the extent (if any) of dumping. If so, the exporter gets a dumping margin based on its actual extent of dumping (if any), and not the highest petitioner claimed dumping margin (assuming the exporter also survives a later rigorous DOC verification audit thereof). In contrast, failure of the foreign exporter to so participate generally results in the highest petitioner alleged AD margin as the AD import duty.
AD and CVD import duty liability generally begins as to imports after the time of the DOC preliminary AD or CVD decision. But it can be retroactive 90 days before then. The earliest theoretical date for retroactive AD duties is July 25, 2024; and for CVD, June 15, 2024. Retroactivity cannot be earlier than 20 days after petition filing. Retroactivity is to address certain 15% or more import surges from a particular exporter after petition filing, to avoid AD/CVD. But all conditions for retroactivity are generally, but not always, not found – e.g., the ITC must find that retroactivity is necessary to avoid the AD/CVD remedy being undermined, which generally (but not always) the ITC does not find, and AD margins must be found above 15% (if the US importer affiliated to the foreign exporter) or 25% (if the U.S. importer is not affiliated to foreign exporter) or an export subsidy found for CVD.
To determine AD/CVD margins, DOC generally issues dumping and subsidy questionnaires to the two largest exporters to the United States from an accused country. All other exporters from a particular country usually get an AD/CVD margin based on DOC findings as to the two largest exporters from that country.
The date of the DOC final CVD/AD decisions is about April 26, 2025, if all deadlines are fully extended (which again is common if foreign exporters fully defend).
The date of the ITC final injury decision is about June 10, 2025, if all deadlines are fully extended (which, again, is common if the foreign respondents fully defend).
Squire Patton Boggs (SPB) members have successfully argued hundreds of AD/CVD cases throughout the world over four-plus decades, and served in key positions at DOC and ITC, as well as key Congressional and US Administration positions. SPB has a premier Government lobbying practice where respondents want that. SPB has an in-house PhD Economist to assist. SPB is a global, full-service, law firm with more than 40 offices worldwide, plus local counsel, in all countries involving AD/CVD. The last two SPB representations of China exporters led to 0% AD cash deposit results.
ADDENDUM: SCOPE OF THE INVESTIGATION
Per the petition:
The following language describes the imported merchandise from China that is within the scope of this Petition:
The merchandise covered by this investigation is disposable aluminum containers, pans, and trays produced primarily from flat rolled aluminum. The subject merchandise includes disposable aluminum containers, pans, and trays regardless of shape or size and whether [optional – this suggestion provides conciseness] wrinkled or smooth, as well as aluminum lids intended to be used in combination with disposable containers produced from aluminum or other materials (e.g., paper or plastic). Disposable aluminum containers are typically used in food-related applications, including but not limited to food preparation, packaging, baking, barbequing, reheating, takeout, or storage, but also have other uses. Regardless of end use, certain disposable aluminum containers, pans, and trays that meet the scope definition are subject merchandise.
The term “disposable” means the aluminum article is designed to be used once, or for a limited number of times, and then recycled or otherwise disposed.
Disposable aluminum containers are also included within the scope regardless of whether the surface has been embossed, printed, coated (including with a non-stick substance), or decorated, and regardless of the style of the edges. The inclusion of a nonaluminum lid or dome sold or packaged with an otherwise in-scope article does not remove the article from the scope.
The flat-rolled aluminum used to produce the subject articles may be made to ASTM specifications ASTM B479 or ASTM B209-14, but can also be made to other specifications. Regardless of the specification, however, all disposable aluminum containers meeting the scope description are included in the scope.
Certain disposable aluminum containers are currently classifiable under Harmonized Tariff Schedule of the United States (“HTSUS”) subheading 7615.10.7125. Further, merchandise that falls within the scope of this proceeding may also be entered into the United States under HTSUS subheadings, 7612.90.1090, 7615.10.3015, 7615.10.3025, 7615.10.7130, 7615.10.7155, 7615.10.7180, and 7615.10.9100. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the scope of this proceeding is dispositive.
