Anti-Circ Petitioners Say Commerce's One-Day Lag Rule Applies Only to 5 p.m. Deadlines

Antidumping and countervailing duty petitioners, led by Atlas Tube, said the Commerce Department properly used adverse facts available against exporter Hoa Phat Steel Pipe Co. in three anti-circumvention inquiries for untimely submitting questionnaire responses in a "straightforward case" (Hoa Phat Steel Pipe Co. v. U.S., CIT Consol. # 23-00248).

In a July 19 response to Hoa Phat's motion for judgment, Atlas Tube said Commerce has "broad discretion to set and enforce deadlines," warranting the use of AFA.

The petitioner also said the agency's "one-day lag" rule, under which Commerce gives companies an automatic extension to the start of the next work day if the agency isn't able to respond to an extension request, applies only to 5 p.m. deadlines. Hoa Phat missed its 11:59 p.m. deadline, so the lag rule doesn't apply, the brief said.

Hoa Phat was one of two mandatory respondents for circumvention inquiries concerning the AD/CVD orders on light-walled rectangular pipe and tube from China, South Korea and Taiwan. During the inquiries, Commerce partially granted various extension requests filed by Hoa Phat, setting a final deadline for Oct. 7.

The day of the deadline, Hoa Phat asked Commerce for an extension until 10 a.m. on Oct. 11, the next business day, due to difficulties experienced in submitting the lengthy responses. Commerce gave the company until 11:59 p.m. Oct. 7. Hoa Phat filed another extension request as midnight approached, to which Commerce didn't respond. Assuming the one-day lag rule applied, the exporter finished filing its submissions Oct. 10, which was a public holiday. Had the lag rule applied, the submissions would have been due Oct. 11.

Commerce rejected the submissions as untimely, using AFA to find that the company circumvented the AD/CVD orders and prompting the present legal challenge (see 2404260060).

In response to its claims, Atlas Tube said that "Commerce bent over backwards to accommodate Hoa Phat’s requests for extensions of time, granting Hoa Phat no fewer than four separate extensions of the deadline to file its questionnaire responses." The petitioner said the exporter ultimately failed to submit its documents on time "due to issues that were entirely foreseeable" and which the company "could have, but did not, take measures to address."

Hoa Phat "audaciously claims that its 11:47 p.m. extension request had the effect of overriding Commerce’s established deadline in favor of a deadline four days later that Commerce explicitly rejected," the petitioner noted.

The petitioner also claimed that the one-day lag rule applies only to requests made before 5 p.m. deadlines. Hoa Phat claimed that because it made its request before the deadline and submitted the responses before the start of the next work day, the "purpose and spirit" of the one-day lag rule "applied to its submission and rendered it timely." Commerce disagreed and said the rule applies only to 5 p.m. deadlines.

Atlas Tube said the agency's interpretation "is a straightforward application of the plain text of the regulatory preamble," which specifies that the rule applies for submissions due at 5 p.m. This clause "would be rendered meaningless surplusage if the mechanism applied to submissions due at any time," the brief said. The agency "clearly attached significance to the specific times of day at which submissions could be due," the brief said.

Hoa Phat's claim is a "naked attempt to game the" rule," Atlas Tube argued. The exporter said the plain text of the rule can be overcome by a "concern that Commerce’s interpretation would incentivize gamesmanship" by encouraging companies to wait until the literal last minute to raise issues they have in submitting documents.

Atlas Tube said this "policy concern is a matter for Commerce, not the Court, to consider," and that Hoa Phat's interpretation of the rule is "an example of the very gamesmanship that Commerce sought to avoid" given that the extension request was filed at 11:47 p.m.