Commerce Correctly Found OCTG Finishing Operations 'Minor or Insignificant,' Domestic Cos. Say

The Court of International Trade should uphold a "reasonable" final determination by the Commerce Department that oil country tubular goods made in Brunei and the Philippines from Chinese hot-rolled steel coils are circumventing antidumping and countervailing duties on OCTG from China, intervenors Welded Tube USA, Wheatland Tube Company, and Vallourec Star said in an Aug. 19 brief (HLDS (B) Steel v. United States, CIT #21-00638).

In the anti-circumvention inquiry, Commerce had held that the assembly of OCTG in Brunei and the Philippines was minor or insignificant in comparison to Chinese manufacture of the input coils. The plaintiffs challenged that holding in June, arguing that Commerce's methodology in comparing the company's production processes with those of integrated steel mills from China was inappropriate.

The brief by the intervenors argues that the comparative analysis of production and investments by Commerce was correct and backed by court precedent. Commerce cannot be expected to evaluate the significance of OCTG finishing operations "on their own" and must compare those operations to the investment required for the creation of the underlying hot-rolled coils when assessing the significance of the Brunei and Philippines operations, the intervenors argued. In doing so, "Commerce correctly determined that the level of investment required for an OCTG finishing facility is minor compared to that of an integrated hot-rolled steel production facility, and that the process of making hot-rolled coils is far more intensive than the HLD Companies’ process of making welded OCTG ... ."

The plaintiffs also are incorrect in arguing that the OCTG imports must surpass negligibility requirements set by the International Trade Commission. The "circumvention statute does not require that the ITC make an injury determination in connection with a circumvention inquiry. ... Instead, Commerce only has to determine that action is appropriate to prevent evasion [of the underlying order]," the intervenors argued.