Timing of the determination

 

Within 75 days after the preliminary determination (for both anti-dumping and countervailing duty investigations), the Commerce Department must make its final determination. Depending on whether there was an extension of the preliminary determination, this final determination will take place sometime between 160 and 225 days (in a countervailing duty case) or 235 and 285 days (in an anti-dumping case) after the petition is filed.

 

It is also possible for the final determination to be extended in anti-dumping cases. If the preliminary determination was affirmative, then the foreign producers who account for a 'significant portion' of the exports under investigation have the legal right to request an extension of up to 60 days. If the preliminary determination was negative, then only the United States industry has the right to request an extension. Occasionally there are battles over whether extensions will be granted, but in most situations extensions have become somewhat routine whenever one party wants an extension. Sometimes the Commerce Department decides an extension is necessary, in which case it applies informal pressure on the appropriate party to make the formal request for the extension.

 

If an extension is granted, the final dumping determination is due 135 days after the preliminary determination. Depending on whether there was an extension of the preliminary dumping determination, the final determination can take place between 295 and 345 days after the petition is filed.

 

In countervailing duty cases, the rule for extending the final determination is different. There is no general rule for extending the final determination for complicated cases. Rather, there is a special rule that applies if there are simultaneous countervailing duty and anti-dumping investigations of the same product, a fairly common occurrence. In this situation, the domestic industry (but not the foreign exporters) has a right to request that the final anti-dumping and countervailing determinations be aligned to occur at the same time. This request, if made, has the effect of delaying the countervailing duty determination.

 

Legal significance

 

The final dumping determination states whether there have been sales at 'less than fair value' or impermissible subsidies within the meaning of the United States law. The Commerce Department calculates a weighted average margin of dumping or subsidy.

 

As noted above in the discussion of preliminary dumping determinations, if the margin is less than 2.0% in an anti-dumping case or 1.0% in a countervailing duty case, the Commerce Department considers the margin to be de minimis and makes a negative determination. In such a situation, the investigation ends. If the margin of dumping is above these thresholds, the Commerce Department makes an affirmative determination and the investigation then returns to the Commission for a final injury determination. In either case, the Commerce Department publishes a notice of the final determination in the Federal Register, and summarizes the various arguments made by the parties and the comments of the Commerce Department concerning those arguments.

 

The date of publication of the final dumping determination in the Federal Register is legally significant. This date marks a change in the potential liability for duties. United States law provides that between the Commerce Department's preliminary and final determinations, the duties eventually collected can be no higher than the rate set in the preliminary determination (and can be lower). This rate is sometimes called the 'cap'. After the final dumping determination, the Commerce Department changes the cap to reflect the margin of dumping or subsidy found in its final determination. The new cap remains in effect until the Commission's final injury determination; it can be lower or higher than the cap established by the Commerce Department's preliminary determination.

 

Note that there is a special rule for countervailing duty cases. Sometimes a 'gap' period opens up, under which the liability for potential countervailing duties ends and then resumes once the final decision has been made.

 

The final determination in the original investigation, however, is not really `final'. Like the preliminary dumping determination, the final determination is only an estimate of the present dumping or subsidy margin, and only establishes the bond or cash deposit rate. The final liability is not fixed until much later.

 

Basis of the determination

 

The final determination is generally based on the information provided in the questionnaire response, and follows methodologies similar to those, used in the preliminary determination. There are important exceptions, however, to this general pattern. First, the Commerce Department is legally permitted to use only information that has been 'verified'. Therefore, if any of the information changes during the verification, the Commerce Department must use the verified information. If too much changes at the verification, the Commerce Department is permitted to disregard the response entirely and instead use the `facts available' rule as a penalty to the foreign respondent.

 

Second, the methodologies in the final determination sometimes vary considerably from those used in the preliminary determination. The preliminary dumping determination may be based on a price-to-price comparison while the final determination is based on a price-to-cost comparison, with cost based on 'constructed value' as defined in the United States law. Foreign companies are thus deprived of the opportunity to see what types of methodologies the Commerce Department is considering for the investigation.

 

After the final determination, the Commerce Department usually holds a disclosure conference to describe the methodologies and calculations used to reach the decision. The degree of disclosure depends a great deal on the individual persons involved. In deciding on the amount of disclosure, the Commerce Department faces a tension between competing policies. On the one hand, complete disclosure is fair to the parties and can sometimes avoid the need to begin a court action just to find out what the Commerce Department actually did in the investigation. On the other hand, the Commerce Department is frequently concerned that complete discloittre could weaken the defence of its decisions in any court action that might result.

 

This historical reluctance to discuss fully the results of a final determination has been changing. In a recent innovation, the Commerce Department implemented a procedure through which various parties can call the Commerce Department's attention to 'clerical' errors (such as arithmetic mistakes and inadvertent decisions to exclude certain data) after the final determination, and the Commerce Department can correct those errors. This new administrative policy, codified in amendments to the United States law in 1988, has required the Commerce Department to begin providing more complete information so that the various parties can review the calculations looking for clerical errors. This process takes place soon after the final determination is made, so it is important to be prepared to make this review as quickly as possible.

 

Source: Business Guide to Trade Remedies in the United States: Anti-dumping, countervailing and safeguards legislation practices and procedures