Commerce Continues to Include Tile With Decorative Layer Within Scope of Ceramic Tile AD/CVD Orders

The Commerce Department continued to include importer Elysium Tiles' composite tile within the scope of the antidumping and countervailing duty orders on ceramic tile from China. Submitting remand results to the Court of International Trade on Oct. 29, Commerce said that the imports' marble top layer doesn't remove the tile from the scope of the orders, which covers "ceramic tile with decorative features" (Elysium Tiles v. United States, CIT # 23-00041).

Elysium's multilayered tile is made of a base layer of porcelain tile, an epoxy layer and a thin top layer of marble, while the scope covers ceramic tile made of a mixture of minerals that are fired, so the raw materials fuse to make a finished good less than 3.2 cm in "actual thickness." Commerce originally determined that the marble layer is a decorative feature, keeping the importer's goods under 3.2 cm. Elysium claimed that the marble layer creates a "functionally different product" as compared to a tile with porcelain backing alone.

The trade court said the parties mistakenly rooted their arguments on the word "decorative," finding the scope language to not have "clear exclusionary language" (see 2407180023). The court said the term "decorative features" was only meant as an example of something that could push the tile's thickness beyond 3.2 cm. Judge Jane Restani said the question is actually whether the process by which the marble is applied is so intensive it exceeds "minor processing."

On remand, Commerce disagreed with the trade court's interpretation of the scope. The agency said it doesn't believe the scope language on "decoration with a ceramic backing" to be irrelevant, since it shows an intent that the scope is meant to cover ceramic tile with decorative features.

The scope says subject merchandise includes "ceramic tile with decorative features that may in spots exceed 3.2 cm." Commerce said it interprets this to mean that the decorative features "need not necessarily cause the resulting tile product to exceed 3.2 cm." The scope doesn't say that it includes tile with decorative features only when those features cause the tile to exceed 3.2 cm, the agency said.

Commerce said the "clear meaning of this sentence, when read in context, is that if ceramic tile is 3.2 cm or less in thickness, regardless of whether it includes decorative features, it is covered by the scope." The agency added that its analysis of the "decorative features" language wasn't contingent on whether the decoration caused the tile to go beyond 3.2 cm in thickness, since it found that the plain scope language covered a tile with decorative features.

The agency also disagreed with the court's conclusion that the real question at play is whether the process applying the marble layer was minor, arguing that the concept of minor processing only concerns whether a product's country of origin was changed due to significant processing of the product in a third country. The scope "does not limit scope coverage to any particular type of production process or level of processing, and nothing in the plain language of the scope indicates that ceramic tile covered by the scope is limited to ceramic tile that has undergone only 'minor processing,'" the brief said.

The relevant question in the scope decision is "whether the resulting product met the physical description of the in-scope merchandise," the agency added. Commerce only addressed arguments on the process by which the marble layer was added, since it was raised by a requesting company, but Commerce itself never considered "whether the process was minor," the brief said.

On remand, Commerce also added a supplement regarding an ex parte meeting the agency had to look at Florida Tile's production facilities, after the court said the agency failed to provide an adequate summary of that trip to the parties.