The firm recently obtained an important victory for United States Steel Corporation in an administrative proceeding before the U.S. Department of Commerce concerning sales at less than fair value (“dumping”) of cold-rolled steel flat products from Brazil. Dumping occurs when a foreign producer sells a good in the United States for less than what it costs the producer to manufacture the good in its home country. To combat this unfair trade practice, the Tariff Act of 1930 authorizes the U.S. Department of Commerce to impose antidumping duties on foreign goods being dumped in the United States. On September 20, 2016, the Department published its amended final determination in this matter, which imposed antidumping duties on cold- rolled steel flat products from Brazil. The Department determined the dumping margins to be 19.58% for Companhia Siderurgica Nacional (“CSN”), 35.43% for Usiminas Siderurgicas de Minas Gerais S.A. (“Usiminas”), and 19.58% for all other Brazilian exporters and producers.
The case began on July 28, 2015, when United States Steel, along with four other domestic steel producers, petitioned the Department of Commerce to investigate cold-rolled steel flat products from eight countries, including Brazil. After the Department initiated the investigation, Quinn Emanuel was retained to oversee the investigation of cold- rolled steel flat products from Brazil. On September 21, 2015, the Department selected CSN and Usiminas to serve as the mandatory Brazilian respondents in the investigation. Over the ensuing months, the Department issued to the Brazilian respondents a series of questionnaires totaling over 200 pages in order to ascertain the data necessary to determine whether they were selling cold-rolled flat steel products in the United States at less than fair value. Many of the Department’s questions were taken from the dozens of comments the firm submitted identifying gaps and inconsistencies in the information suppled by the Brazilian companies.
On November 11, 2015, Usiminas announced that it would no longer cooperate with the Department, and it ceased participating in the administrative proceeding. Accordingly, Commerce ultimately calculated Usiminas’s dumping margin by using the available facts and drawing an adverse inference.
In April and May 2016, the Department conducted a detailed verification in Brazil and the United States of CSN’s data. Following verification, the parties submitted lengthy case briefs and rebuttal briefs. Many issues were in dispute, but perhaps the single most important was whether CSN was entitled to a duty drawback adjustment for four Brazilian taxes.
The Department was ultimately persuaded by the firm’s brief and, on July 20, 2016, it issued its final determination, which calculated the dumping margin of CSN and all others to be 14.43%. In issuing this decision, the Department agreed with the firm’s argument that three of the four Brazilian taxes for which CSN sought a duty drawback adjustment were not “import duties” within the meaning of the Tariff Act of 1930 and therefore were not eligible for a duty drawback adjustment. This decision will serve as a strong precedent in future international-trade proceedings to limit the ability of foreign producers to claim duty drawback adjustments.
Even after receiving a successful final determination, Quinn Emanuel continued to work towards a total victory. The firm scoured the materials supporting the Department’s determination and identified an error in the calculations that caused the Department to understate the dumping margin significantly. The firm accordingly notified the Department, which then issued the amended final determination that raised the dumping margins for CSN and all others to19.58%. With these high margins in place, this decision will be an important bulwark in ensuring a level playing field in the domestic steel market and in discouraging foreign producers from unfairly dumping goods in the United States.