Successor-in-Interest CVD CCR Requires Individually Examined Firms, Canadian Lumber Producer Argues

The Commerce Department continued to ignore a Court of International Trade remand order when it continued to refuse in its remand results to grant a changed circumstances review for GreenFirst Forest, the company said in its April 3 comments (GreenFirst Forest Products v. U.S., CIT # 22-00097).

GreenFirst, a Canadian lumber firm, asked the court to again remand the matter to Commerce with instructions to initiate the requested CCR. GreenFirst had bought lumber mills from Rayonier A.M. Canada (RYAM) and argues that this caused it to be a successor-in-interest to RYAM, which would confer RYAM's 7.42% "non-selected" countervailing duty rate rather than the 14.19% all-others rate.

In its remand results, Commerce refused to initiate a CCR, explaining that whether a predecessor company has been individually examined is irrelevant and that there is no requirement for the predecessor company to have an individual subsidy rate (see 2302170042).

Commerce found that GreenFirst is not the same company as RYAM because a significant change occurred in its corporate structure and GreenFirst only bought RYAM's lumber mills rather than acquiring the entire company. Commerce said that it will not consider a company to be the successor-in-interest for countervailing duty purposes when the company "has undergone significant changes that would require Commerce to fully assess the company’s level of subsidization to determine the effects of the changes."

That explanation on remand ignored the court's determination that Commerce unreasonably applied its significant changes practice because the department never calculated an individual subsidy rate for the predecessor company. "Commerce’s repeating of its already rejected reasoning ignores the Court’s previous findings," GreenFirst said.

The court held that Commerce applied its practice unreasonably because that very practice requires Commerce to have calculated an individual subsidy rate for the predecessor company, which the department never did in this case, GreenFirst said. There is no reason for Commerce's "practice to exist when the predecessor company has no individually calculated rate," GreenFirst said.