| | Cold Finished Steel Bar Institute
February 6, 2007
Committee on Ways and Means
The United States House of Representatives
1102 Longworth H.O.B.
Washington, D.C. 20515
Dear
Sir/Madam:
On behalf of the Cold Finished Steel Bar Institute, I
want to respond to the January 31, 2007 Advisory from the Committee on Ways and
Means soliciting comments on the Commerce Department’s proposed modification to
its calculation of weighted-average dumping margins in antidumping
investigations. Congress must vigorously oppose the Commerce Department’s
decision to end its long-standing practice of “zeroing,” which will eviscerate
the principal tool available to U.S. manufactures and producers to combat
unfair trade practices.
The Commerce Department, on December 27, 2006,
notified Congress that it would implement the World Trade Organization’s
Appellate Body ruling in United States – Laws, Regulations and Methodology
for Calculating Dumping Margins (“Zeroing”) (WT/DS294) (“US – Zeroing (EC)”).
To implement the WTO decision in US – Zeroing (EC), the
Commerce Department stated that it would, effective February 22, 2007, begin to
offset positive dumping margins (sales that were not dumped) against sales with
negative dumping margins (sales that were dumped), when calculating the
weighted-average dumping margin in antidumping investigations (71 Fed. Reg.
77,722). In other words, Commerce will no longer set positive dumping margins
to “zero” when calculating overall margins of dumping. The effect of this
change to U.S. law will be to understate and/or eliminate margins of dumping in
investigations by masking dumped sales by foreign exporters.
Congress must oppose the Commerce’s Department’s
inappropriate concession on this issue. First, Congress has given the
Administration explicit instructions in the context of the on-going Doha Round
of negotiations to defend the practice of zeroing. Second, Congress, not
Commerce, is the proper body for making laws. For many years, the Commerce
Department argued before the Courts that it was statutorily required to
zero in investigations. While the Courts have stated that Commerce has some
discretion in this matter, Commerce changed its view only when it became
apparent that the WTO intended to ban improperly the practice of zeroing. The
Department should not alter course because of an adverse WTO ruling that fails
to address significant arguments and findings by the lower panel, relies on
novel theories and makes findings based on evidence not before the Appellate
Body, and that exceeds the Appellate Body’s authority by creating obligations
that do not exist in the WTO agreement.
Additionally, in May 9, 2006 comments filed at the
WTO, the Administration noted “disturbing” aspects of US – Zeroing (EC)
decision, including that (1) it would be “extraordinary” for Members
to have negotiated specific language in the Antidumping Agreement now rendered
superfluous by the appellate body ruling; (2) the Appellate Body’s finding that
dumping should be measured for “the product as a whole” reverses 47 years of
WTO jurisprudence finding that dumping should be measured “in respect of each
single importation of the product;” and (3) that the ruling banning the
practice of zeroing was never agreed to by Member States in the Uruguay Round
or previous trade agreement negotiations.
Since Marbury v. Madison, the Supreme Court has
consistently found U.S. law to trump conflicting international law. The
importance of decisions such as Marbury underscore that Congress’
considered opinion and deliberative process, as reflected in U.S. law, must not
yield to decisions such as US – Zeroing (EC), which rest on
faulty logic or ill-considered evidence and which greatly exceed the Appellate
Body’s authority.
In
sum, Congress should require the Commerce Department to continue its
long-standing practice of zeroing when calculating antidumping duty margins in
investigations.
Respectfully
yours,
David
Gillespie
Chairman,
Government Relations Committee
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