FINAL RESULTS
OF REDETERMINATION
PURSUANT TO COURT REMAND
STEEL AUTHORITY OF INDIA, LTD. V. UNITED STATES
Court No. 00-03-00099
SUMMARY
The Department of Commerce (Commerce) has prepared these final results of redetermination pursuant to the remand order of the U.S. Court of International Trade in Steel Authority of India, Ltd., v. United States, Slip op. 2001-60 (May 22, 2001) (SAIL). This remand pertains to Commerce's application of adverse facts available to the Steel Authority of India, Ltd. (SAIL) as a result of SAIL's failure to provide information required for Commerce's antidumping analysis. See Notice of Final Determination of Sales at Less than Fair Value: Certain Cut-to-Length Carbon-Quality Steel Plate Products From India, 64 Fed. Reg. 73126 (Dec. 29, 1999), as amended, 65 Fed. Reg. 6585 (Feb. 10, 2000) (Final Determination). As explained below, Commerce has determined, upon re-examination of the facts associated with this issue, that SAIL had the ability to comply with the agency's information requests, but that SAIL did not cooperate to the best of its ability within the meaning of 19 U.S.C. § 1677e(b).
BACKGROUND
During the underlying investigation, Commerce was required to rely entirely upon the facts available because SAIL submitted untimely and incomplete information, its computer tape submissions remained unuseable throughout the course of the proceeding, and its information could not be verified. See Final Determination, 65 Fed. Reg. at 73126-27. Based on the inadequacy, incompleteness and untimeliness of SAIL's information, SAIL's unfulfilled promises that it would provide the necessary data, and SAIL's failure to reconcile the information it did submit to its books and records at verification, Commerce determined that SAIL failed to act to the best of its ability to comply with the agency's information requests. Id. at 73127. Therefore, consistent with 19 U.S.C. § 1677e(b), and to ensure that SAIL did not benefit by its failure to act to the best of its ability, Commerce applied an adverse inference in selecting from among the facts otherwise available in calculating SAIL's margins.
In its May 22, 2001, opinion, the Court affirmed Commerce's determination to apply the facts available to SAIL, agreeing that Commerce's decision to reject SAIL's submissions due to pervasive and persistent deficiencies is supported by substantial record evidence. Slip Op. 01-60 at 13-14. The Court held, however, that Commerce "made no finding that SAIL refused to cooperate or could have provided the information requested but didn't, thereby justifying the use of adverse inferences." Id. at 17. The Court ordered Commerce to "make specific findings as to whether SAIL had the ability to respond and failed to do so or otherwise reconsider its decision to apply an adverse inference in choosing the available data to calculate a margin." Id. at 19.
ANALYSIS
In order to use adverse facts available, Commerce must make a finding, supported by substantial evidence, that the "interested party . . . failed to cooperate by not acting to the best of its ability to comply with a request for information." 19 U.S.C. § 1677e(b); SAIL, slip op. 2001-60 at 15. According to the Statement of Administrative Action ("SAA"),
A party is uncooperative if it has not acted to the best of its ability to comply with requests for necessary information. Where a party has not cooperated, Commerce . . . may employ adverse inferences about the missing information to ensure that the party does not obtain a more favorable result by failing to cooperate than if it had cooperated fully. In employing adverse inferences, one factor the agencies will consider is the extent to which a party may benefit from its own lack of cooperation.
SAA, H.R. Rep. No. 103-826, at 870 (1994). Commerce has explained that affirmative evidence of bad faith on the part of a respondent is not required to employ an adverse inference. See Antidumping Duties, Countervailing Duties: Final Rule, 62 Fed. Reg. 27,296, 27,340 (1997) (Final Rules) (preamble discussion of 19 C.F.R. § 351.308 (1997)). This approach is reasonable because restricting the agency's ability to apply an adverse inference to only those instances in which it could be affirmatively demonstrated that the respondent acted in bad faith would severely curtail the agency's ability to obtain information. Moreover, it would often be impossible for the Department to make such a "bad faith" determination.
Commerce recognizes that, in order to satisfy its statutory obligation, it must be explicit in its reasons for applying an adverse inference as a consequence of SAIL's failure to cooperate to the best of its ability. Moreover, the court has indicated that, if a respondent claims an inability to comply with an information request, Commerce, in order to apply an adverse inference, must conclude that the exporter had the ability to comply with the request and did not do so. SAIL, slip op. 2001-60 at 15 (citing Krupp Thyssen Nirosta GmbH v. United States, 24 CIT __, __, slip op. 2000-89 at 14 (July 31, 2000) ("Krupp Thyssen"); Kompass Food Trading Int'l v. United States, 24 CIT __, __, slip op. 2000-90 at 8 (July 31, 2000) ("Kompass Food"); Gourmet Equipment Corp. v. United States, 24 CIT __, __, slip op. 2000-78 at 15 (July 6, 2000) ("Gourmet Equipment"). As set forth below, Commerce finds that SAIL failed to cooperate to the best of its ability and that SAIL could have provided the information requested but did not do so, thereby justifying the use of adverse inferences.
1. Based on the administrative record, SAIL had the ability to comply with Commerce's information requests.
Although responding to the antidumping questionnaire can be a demanding exercise, it is tailored so that it can be completed by companies that keep audited records of their sales and costs. Every year, Commerce sends essentially the same questionnaire to dozens of foreign producers, and the great majority of these respondent companies is able to provide the necessary information. Although Commerce modulates the level of detail and (importantly) the type of computerization required in order to accommodate each company's unique circumstances, in the main, Commerce solicits much the same type of information from each company. As a general matter, it is reasonable for Commerce to conclude that, if companies with fewer resources can respond fully and adequately to an antidumping questionnaire in a timely manner, a company with the resources and expertise of SAIL, that does not inform the Department otherwise in a timely fashion, is also capable of doing so.
It should be noted that Commerce has very limited knowledge of the actual extent of a respondent's ability to comply with requests for information. It is the respondent, not Commerce, that possesses the necessary information and knowledge of the company's operations and records. Therefore, it is incumbent on the respondent to demonstrate why it is incapable of providing requested information in a timely manner. Commerce cannot rely on mere assertions of vague "difficulties" or inability to comply as a basis for concluding that a respondent acted to the best of its ability.
That is why the Department requires the reason why a party has failed to provide requested data. Without a specific, compelling explanation, Commerce generally has no means of discerning if a respondent is truly incapable of complying. If there was some circumstance beyond SAIL's control that prevented it from responding adequately and in a timely manner, it did not offer any such explanation. SAIL has not demonstrated that its failure to respond accurately is excused "because it was not able to obtain the requested information, did not properly understand the question asked, or simply overlooked a particular request." Mannesmannrohren-Werke AG v. United States, 77 F.Supp. 2d 1302, 1316 (CIT 2000) (Mannesmann I). The information that SAIL failed to provide was within its own control. Moreover, SAIL was provided with substantial guidance on the questions asked, and its failure was more comprehensive than the simple oversight of a particular request.
During the underlying investigation, SAIL did advise Commerce that it was experiencing difficulties in gathering and submitting the requested information. Typically, however, these difficulties were offered to justify requests for additional time to submit information (which the Department repeatedly granted) and were often accompanied by assurances that the information would be forthcoming. For example, in its May 11, 1999, database submission -- which was filed late due to a computer "breakdown" -- SAIL indicated that "some of the data requested by [Commerce] is still being collected (because, e.g. it is available only in handwritten form). As soon as these data are available we will submit them to the Department and revise the diskette accordingly." Def. Ex. 5, C.R. 7. Thus, in the underlying proceeding, SAIL's reference to handwritten records was given as an example of why it needed additional time. SAIL did not indicate that it would be unable to provide a usable database; on the contrary, it promised that such a database would be forthcoming. As a result, we disagree with SAIL's suggestion, Pl.'s Mem. Supp. Mot. J. Agency R. at 32, that its identification of these logistical difficulties demonstrates that it could not comply with the information requests. In Commerce's view, the record demonstrates that SAIL could comply with the request for data, and SAIL never offered any valid explanation of circumstances that rendered it incapable of complying with those requests.
In the underlying proceeding, the Department repeatedly requested that SAIL remedy deficiencies in its response and SAIL gave every indication that it would comply with the agency's information requests. Where information was not provided initially, SAIL indicated that it would be submitted as soon as it became available and that unuseable computer tapes would be revised accordingly. See, e.g., Def. Ex. 5, C.R. 7; see also Def. Ex. 11, C.R. 17 (SAIL submitted revised computer tapes and stated that all home market sales made during the period were provided). At SAIL's behest, Commerce took the unusual step of permitting the submission of significant amounts of information after the preliminary determination; SAIL assured Commerce that this new data could be verified. Def. Ex. 25, C.R. 33. All of these representations suggest that SAIL itself believed it could comply with the requests for information. (1) In such circumstances, it is reasonable for Commerce to conclude that SAIL had assessed its own operations and knew that it could fulfill its representations. This Court has held that it is "reasonable for Commerce to charge [a respondent] with knowledge of its own operations." Mannesmannrohren-Werke AG v. United States, Slip Op. 00-126 (CIT October 5, 2000) (Mannesmann II). Therefore, even accepting that SAIL's efforts were made in good faith "does not relieve its burden to respond to the best of its ability, and its 'ability' includes possessing knowledge of its business operations." Id.
To conclude that SAIL tried its best but simply could not report accurate information about its home market sales or production costs is not credible. SAIL is one of the largest integrated steel producers in the world, (2) with significant expertise in many areas and significant resources at its disposal. For example, SAIL has an established accounting system and its books are audited annually by a large team of public accountants. See, e.g., SAIL Section A Response, C.R. 5, at Exhibit A-9 (SAIL Annual Report). Moreover, because SAIL is predominantly owned by the Indian Government, SAIL is accountable for a variety of additional Government accounting requirements. Based on the information available to Commerce, we conclude that SAIL had the ability to comply with the information requests. In sum, SAIL is and should be accountable for the information recorded in its books and records. To conclude otherwise would allow respondents to provide only the most rudimentary information, without regard to the information actually required for an investigation. More importantly, to allow a respondent to select the information it will submit provides a major incentive for self-serving behavior - supplying information that is generally favorable while claiming that it cannot supply information that might prove unfavorable to respondent. As this Court has noted, such an approach would directly contradict the policy behind the use of facts available. SAIL, slip. op. 2001-60 at 12 (citing Rhone Poulenc, Inc. v. United States, 13 CIT 215, 225, 710 F. Supp. 341, 347 (1989), aff'd, 889 F.2d 1185).
This investigation may have been SAIL's "first real brush with U.S. antidumping law," SAIL February 5, 2001, Reply Brief at 2, n. 2, but SAIL has provided us with no information that indicates it could not comply with the information requests made by Commerce. Thus, it is reasonable for Commerce to conclude that SAIL had the resources and ability to comply with Commerce's questionnaire but inexplicably failed to do so.
As Commerce explained in the Final Determination,
[t]o examine whether the respondent "cooperated" by "acting to the best of its ability" under section 776(b), [Commerce] considers, inter alia, the accuracy and completeness of submitted information and whether the respondent has hindered the calculation of accurate dumping margins.
64 Fed. Reg. at 73127 (citation omitted). Commerce identified "repeated problems in the timeliness and completeness of submissions and the workability of computer tapes" as instances in which SAIL had hindered the calculation of accurate dumping margins." Id. In addition, Commerce stated that "verification revealed that SAIL's data was significantly inaccurate, incomplete or otherwise unreliable." Id. For these reasons, Commerce concluded that SAIL did not cooperate to the best of its ability and used an adverse inference in selecting a margin as facts available. Id. at 73127-28.
In responding to the Court's findings, we have focused on SAIL's actions in the underlying investigation. We have not attempted to determine, as SAIL has proposed, whether SAIL's failure to cooperate to the best of its ability was a result of willfulness or bad faith. It is the agency's experience that the question of whether failure to produce information was due to "willfulness" or bad faith is only rarely capable of objective resolution based on the administrative record. More important, "willfulness" or bad faith is not the standard set forth in the statute. As a result, a finding of "willfulness" or bad faith is not an appropriate test for determining whether a company cooperated to the best of its ability. If the agency's ability to apply an adverse inference was restricted to instances in which it could be demonstrated that the respondent made a "willful" decision not to comply with information requests, the agency's ability to obtain information would be severely curtailed. Therefore, we have focused on specific actions by SAIL that demonstrate that it failed to cooperate to the best of its ability.
The determination of whether a company has acted to the best of its ability must be decided on a fact- and case-specific basis. Final Rules, 62 Fed. Reg. at 27,340. The determination must be applied in light of the circumstances surrounding the company at issue. Moreover, this standard must be applied with due regard to the fact that, by its very nature, a dumping proceeding is a demanding process, but also one in which a respondent's cooperation is the only means that Commerce has of obtaining the information it needs to meet its statutory obligations. Thus, for example, our review of a respondent's actions should not prohibit application of an adverse inference where a respondent, weighing the costs and benefits of responding, does not expend the resources necessary to cooperate in the most accurate way it can. In other words, we recognize that a respondent might judge a request to be too troublesome relative to its stake in the U.S. market, or a respondent might conclude that providing such information could result in a higher dumping margin. A respondent may simply gamble that it can satisfy its obligation to respond with minimal resources but, by devoting too few of its resources to the proceeding, it may create a situation in which its failure to adequately respond becomes inevitable. Nevertheless, such a judgment cannot excuse a respondent from its obligation to cooperate to the best of its ability, as such behavior would subvert the goal of calculating accurate dumping margins in the manner prescribed by the statute. See Rhone Poulenc, Inc. v. United States, 899 F.2d 1185, 1191 (Fed. Cir. 1990). For this reason, the statute requires a respondent to cooperate "to the best of its ability," rather than merely requiring that it make what it views as sufficient effort to cooperate. 19 U.S.C. § 1677e(b).
As to whether SAIL cooperated to the best of its ability, we will refer to the facts of record to make our reasoning more explicit. While SAIL has derided Commerce's reference to the facts as "painful," SAIL February 5, 2001, Reply Brief at 2, our view is that the facts make it clear that SAIL did not act to the best of its ability. SAIL's questionnaire responses were subject to unexplained computer "breakdowns" (Def. Ex. 5, C.R. 7), errant couriers (Def. Ex. 14, P.R. 45), and unexplained untimeliness (Def. Ex. 15, P.R. 51). Fundamental deficiencies were brought to SAIL's attention repeatedly but never adequately addressed. See, e.g., Def. Ex. 7, C.R. 10 at cover letter (questionnaire response substantially incomplete; failure to respond to an entire section of the cost questionnaire); Def. Ex. 15, P.R. 51 (continued failure to provide product-specific costs or explain why such costs cannot be derived; unworkable electronic databases). During on-site examination at SAIL's facilities in India, much of the information SAIL did submit could not be verified. Def. Ex. 30, C.R. 41
To cooperate to the best of its ability, SAIL was obligated to pay more attention to the detail of submitting information accurately and on time. The Department repeatedly accommodated SAIL by granting it more time, but the agency ultimately concluded - because SAIL never indicated otherwise - that there was no reasonable basis for its failure to provide the information requested. For example, SAIL should have ensured that electronic database submissions were checked for deficiencies; instead, SAIL submitted databases that had data missing and did not correspond to one another, even after multiple supplemental questionnaires issued by Commerce identified these deficiencies for SAIL. Def. Ex. 12, C.R. 24, at Attachment. SAIL could have assessed its operations and focused the appropriate resources on data collection in those areas needing special attention. Instead, for example, SAIL failed to deliver on its repeated promise of producing useable cost of production data. See Def. Ex. 30, C.R. 41 at 2-3. The requested information was solely within SAIL's control and the company never indicated that its failure to provide the information was the result of confusion regarding the questionnaire or circumstances beyond its control. Therefore, in Commerce's view, SAIL did not act "to the best of its ability," as required by the statute.
In similar cases, Commerce has considered the importance of the information, the time pressures of the investigation, and any other information bearing on a determination of whether a respondent's failure to provide information was an "excusable inadvertence" or a "demonstration of lack of due regard for its responsibilities." Nippon Steel, 118 F. Supp.2d at 1379. As noted above, the information requested by Commerce was fundamental to the dumping calculation; the absence of necessary information and the deficient nature of much of what was submitted meant that Commerce was unable to conduct its analysis. After being granted ample time to comply with the Department's requests, SAIL's unexplained untimeliness and non-responsiveness in the submission of information demonstrates a disregard for the process Commerce must follow and the obligations that the agency must fulfill in administering the dumping law. With respect to the time pressures of the investigation, the record plainly reflects that Commerce provided SAIL with multiple extensions for replying to both the original and supplemental questionnaires. Thus, Commerce cannot conclude that SAIL's failure to provide adequate and timely information was due to the time pressures of the investigation, but rather was a "demonstration of lack of due regard for its responsibilities." Nippon Steel, 118 F. Supp.2d at 1379. As this Court has stated,
[i]nsufficient attention to statutory duties under the unfair trade laws is sufficient to warrant adverse treatment. It implies an unwillingness to comply or reckless disregard of compliance standards.
Id. at 1378-79.
Interested Party Comments
SAIL contends that the Department's portrayal of events in the draft remand grossly misstates what occurred during the investigation. First, SAIL claims that the Department could read the company's sales and cost computer files, but found them to be unuseable because it did not understand, and failed to ask, how the control number reported for each observation in the sales files corresponded with the range of control numbers reported for each observation in the cost files. (3) SAIL notes that the Department failed to mention the problem it was having with the computer tapes until July 16, 1999, and thus the company reported control numbers in its July 16, 1999 cost file in the same form that was used in the original May 10, 1999 cost file. SAIL asserts that the draft remand omits or misstates important information regarding the difficulties it encountered in providing product-specific cost data. In addition, contrary to the Department's claim that the required cost information was never provided despite evidence at verification that such costs could be derived, SAIL contends that the record contains the required product-specific costs in the sense that the record contains all the cost elements, as corrected and verified. SAIL states that the necessary adjusting data and the process of calculating product-specific costs have been verified and at verification it offered to recalculate costs but the Department declined to accept the recalculation. Thus, SAIL argues that it is disingenuous for the Department to complain that the cost information was never provided when the Department has verified cost data and declined to accept the offered recalculation.
Second, SAIL contests the Department's finding that the company had the ability to comply with information requests. SAIL notes that it operates in India, one of the poorest countries in the world and that its resources are, in fact, very limited. SAIL states that, as observed by the Department's verification teams, the company's office equipment (typewriters, copy machines, telephones, filing systems) is antiquated and its systems are ill-suited to responding to the Department's requests for information. SAIL maintains this point was illustrated by the difficulties it had in providing quality copies at verification. SAIL claims the Department believed the company could have purchased or rented a new copy machine to produce satisfactory copies at verification. However, SAIL states that it is a bureaucratic organization in a poor country where procurement of new equipment is guided by "community standards" and thus it is unreasonable to expect it would allot a disproportionate share of its resources to satisfy the Department. Nevertheless, SAIL notes that by devoting as many resources as it could for many months it was able to 1) provide a sales file containing all U.S. sales and, with minor exceptions, all the important information was on time and correct, 2) provide two distinct sets of cost data, the second of which was based on verified production quality control data, and 3) provide a home market sales response that was substantially correct with respect to the products that the Department considered appropriate comparisons with exported merchandise. Thus, SAIL concludes that it acted to the best of its ability in the investigation and that the data on the record are adequate for calculating an accurate dumping margin.
In response, the petitioners refer to the SAIL's submitted 1997-98 annual report and auditor's reports to support the Department's view that SAIL has the ability to respond to questionnaires in the same manner as other respondents with audited sales and cost records. The petitioners point out that under 19 U.S.C. §1677m(c), parties must promptly notify the Department if they cannot provide information in the requested form and manner, and in this instance SAIL gave repeated assurances that it would provide the information as requested by the Department. According to the petitioners, SAIL's assurances constitute substantial evidence that the respondent in fact had the ability to supply the information requested by the Department.
According to petitioners, SAIL did not provide a significant percentage of the home market sales information requested by the Department, which it should have been able to provide. Of SAIL's three plants which produce the subject merchandise, no records were submitted from one, and only half of the sales were reported from another. In addition, petitioners state that SAIL systematically under-reported its home market sales prices by failing to include in its gross unit price figures a premium that it customarily charges for such sales as a matter of policy. Once the Department discovered the premium, the respondent produced a worksheet showing the "extra charges," without any explanation for its prior failure to do so. Further, petitioners note that SAIL admitted at verification that both the total cost of manufacture and the variable cost of manufacture submitted on its COP tape were incorrect. According to petitioners, there is still no way to verify the data on the tape in any case, because the underlying cost data and source documents have never been provided in a useable format.
In response to SAIL's statement that the inability of the Department to use the computer tape submissions was the result of the Department's own confusion, the petitioners note that the Department worked extensively with SAIL to correct problems with the electronic databases which were numerous and prevented the tapes from loading. The petitioners also state that the Department gave SAIL more than adequate notice that its product-specific cost submission was deficient. If indeed only a modest effort was required to construct product-specific costs from information already on the record, then SAIL's failure to provide product-specific costs is further evidence that it failed to provide information to the best of its ability.
Finally, the petitioners respond that the condition of SAIL's office equipment is outside of the record, and that SAIL could have indicated during the course of the investigation that the state of its office equipment would keep it from complying with the Department's information requests. To the contrary, SAIL gave the Department repeated assurances that it would comply, and later insisted that it had complied, according to the petitioners. The claim is late, as it now comes after a remand from an appeal, and it is inconsistent with SAIL's prior position.
DOC Position:
We disagree with SAIL's claim that the Remand Determination misstates what occurred in the underlying investigation. First, SAIL suggests that problems with its computer tape submissions in the case stemmed from the Department's "own confusion" about the way "product control numbers" or "CONNUMs" were presented by SAIL. SAIL's Remand Comments at 1-2. We note that the Court has already determined that the Department properly rejected SAIL's cost and sales information as insufficient. In fact, in its initial brief before the Court, SAIL clearly acknowledged that, in the end, the databases it submitted were inadequate for purposes of calculating an accurate dumping margin. See Pl.'s Mem. Supp. mot. J. Agency R. at 6 ("[W]e are not contesting the flaws in the home market and cost data.... SAIL is well aware of the limitations in the data it was able to provide to the Department") (emphasis in original). Moreover, in the Department's view, SAIL's new explanation for just one element of its deficiencies -- its reporting of CONNUMs -- amounts to little more than a post-hoc rationalization that attempts to shift blame from itself to the Department. A review of the record is illustrative:
2. On June 11, 1999, Commerce issued a further deficiency questionnaire covering Sections A-C of SAIL's questionnaire response. Def. Ex. 10, C.R. 16. Commerce requested that SAIL provide more specific information on variables reported in its home market, U.S. sales and cost databases. Id. at Attach. I. The Second Deficiency Questionnaire also identified inconsistencies between SAIL's narrative explanation and its reported databases, including inaccurate CONNUMs. Id. at Attach. II. Commerce granted SAIL an extension to provide its deficiency responses. Id. at cover letter.
The most important fact that SAIL chooses to ignore is that during the course of the
investigation, the Department's staff worked regularly with SAIL's counsel to identify
deficiencies in the electronic database. Def. Ex. 12, C.R. 24 (memorandum to file describing
telephone conversations held between SAIL and the Department's staff concerning noted
deficiencies). During this period, SAIL never made the claim that it was the Department that was
confused nor did SAIL provide information that sufficiently corrected the deficiencies.
Moreover, SAIL is incorrect in its statement that the Department did not sufficiently notify SAIL
of the deficiencies in its databases. The administrative record reflects that the Department
provided SAIL with more than adequate notice of the deficiencies in its information, and that
SAIL's failure to provide the necessary information was a failure wholly of its own making.
While SAIL insists that "with modest effort, the Department could do the arithmetic on the data
on the record," SAIL's Remand Comments at 3, the burden of creating an accurate record rests
with the respondent. (4)
See Ta Chen Stainless Steel Pipe, Inc. v. United States, __ CIT __, Slip
Op. 2000-107 (August 25, 2000). In short, there is no basis for SAIL's attempt to hold the
Department responsible for its own deficient data. Second, SAIL contests the Department's finding in the Remand Determination that SAIL had the
ability to respond to the Department's questionnaire. SAIL's Remand Comments at 4.
According to SAIL, the Department "ignores the fact that SAIL operates in India, one of the
poorest, and therefore, least productive countries in the world." Id. As we detailed in the
Remand Determination, however, SAIL never claimed during the underlying proceeding that it
could not provide the necessary information. Remand Determination at 3. Instead, SAIL
identified difficulties it was encountering as an Indian producer in order to justify extensions of
time in which to submit the requested information. In the underlying proceeding, SAIL gave
every indication that it would comply with the Department's requests for information and SAIL
requested -- and was granted -- numerous extensions of time in which to do so. As noted above,
the Department's staff provided SAIL with extensive guidance on how to correct the pervasive
deficiencies identified by the agency without receiving any indication from SAIL that it could not
make the necessary corrections. See July 7, 1999, Memo to File, C.R. 24, at 1-2. In sum,
evidence on the administrative record reflects the fact that 1) SAIL could comply with the
information requests, 2) SAIL indicated that it would comply with these requests, and 3) its
unexplained failure to do so demonstrates that it failed to act to the best if its ability. Finally, contrary to SAIL's assertion in its Remand Comments at 4, the data it did provide was
not adequate for the calculation of an accurate dumping margin for SAIL's exports to the United
States. As noted above, the Court has already determined that the Department properly rejected
SAIL's cost and sales information as insufficient. In order to calculate an accurate dumping
margin, the Department needed SAIL's data on U.S. sales, home market sales, cost of
production, and constructed value. SAIL has already acknowledged that its home market and
cost data were not useable, Pl.'s Mem. Supp. Mot. J. Agency R. at 6. The Department's on-site
verification revealed that SAIL's data was "significantly inaccurate, incomplete or otherwise
unreliable." Final Determination, 64 Fed. Reg. at 73127. To use what remains of SAIL's data --
including data which it attempted to submit at verification -- would not result in an accurate
margin calculation; rather, it would result in SAIL, not the Department, having ultimate control
over determining what information would be used for the margin calculation, in direct
contradiction to the policy behind the use of facts available. See Rhone Poulenc, Inc. v. United
States, 13 CIT 215, 225, 710 F. Supp. 341, 347 (1989), aff'd, Rhone Poulenc, 889 F.2d 1185
(holding that the BIA rule, the forerunner to facts available, is designed to "prevent a respondent
from controlling the results of an administrative review by providing partial information"). In
any event, as the Department has fully explained, SAIL's information was so deficient and
incomplete that it could not serve as a reliable basis for calculating a dumping margin. See SAIL
slip op. 2001-60 at 14 ("[SAIL's] information considered as a whole would result in an
inaccurate dumping margin"). Results of Redetermination For the foregoing reasons, Commerce determines, on remand, that SAIL failed to
cooperate to the best of its ability to comply with Commerce's information requests. Therefore,
pursuant to 19 U.S.C. § 1677e(b), Commerce determines that it properly used an adverse
inference in selecting from the facts otherwise available with respect to determining a margin for
SAIL. __________________________________ __________________________________ (Date)
1. Even on the issue of product-specific costs, where SAIL identified that its accounts did
not itemize costs in the detail requested by Commerce, the company stated that it would provide
a reasonable surrogate for establishing these costs. July 19, 1999 SAIL Cost Submission, C.R.
26, at 2 ("SAIL is willing to develop product-specific CTL plate costs on the methodology
outlined in the response or any reasonable methodology that [Commerce] might propose").
Later, SAIL stated that the submission of such costs "can be done but only with an extraordinary
effort." 2. As the state-run government producer, SAIL operates three large integrated steel plants,
one alloy steel plant, and a research and development center for iron and steel. SAIL's annual
steel sales exceed those of many steel companies that participate in other AD cases before
Commerce. While steel plate may be viewed as a relatively unsophisticated steel product, SAIL
sells comparatively more sophisticated alloy steel products, as well as consulting services to
design and engineer steel factories in other countries. See generally SAIL Section A Response,
C.R. 5, at Exhibit A-9 (SAIL Annual Report). This evidence supports the conclusion that SAIL
is a large, sophisticated company.
3. SAIL maintains that this reporting methodology was used because the reported costs did
not distinguish between different grades and thicknesses of product, and thus applied to more
than one control number.
4. Although SAIL has previously acknowledged that its home market and cost data were
not useable, Pl.'s Mem. Supp. Mot. J. Agency R. at 6, SAIL now suggests that its cost data could
have been rehabilitated based on information offered by SAIL during the on-site verification but
rejected by the Department. This is an entirely new argument and is inappropriately raised here
for the first time during this proceeding. Moreover, in addition to contradicting its previous
assessment of its own information, SAIL's argument ignores the purpose of verification, which is
to spot check information already provided by respondents, not to adopt significant data provided
for the first time. See Bomont Indus. v. United States, 14 CIT 208, 209, 733 F. Supp. 1507, 1508
(1990) ("Verification is like an audit, the purpose of which is to test information provided by a
party for accuracy and completeness," so that Commerce can justifiably rely upon that
information).
Assistant Secretary
for Import Administration
footnotes: