CS Wind’s victory in the court battle in US

On August 12, 2016, the US Court of Appeals for Federal Circuit (CAFC) issued its judgment on an appeal filed by CS Wind, Vietnam, against the ruling of the lower Court, the Court of International Trade, New York (CIT), pursuant to the Department of Commerce’s (DOC) final determination in the Anti-dumping (AD) proceedings on exports of Utility Scale Wind Towers from Vietnam to US market.

Out of three issues before the superior Court, CAFC allowed CS Wind’s appeal on one issue, sustained CIT’s decision on another issue and vacated CIT’s decision on the third issue, remanding it to DOC for a redetermination, consistent with the opinion of CAFC.

Pursuant to a Petition filed by the US Wind Tower Trade Coalition (WTTC), an AD Investigation on Utility Scale Wind Towers from Vietnam was initiated by DOC in January 2012.

CS Wind, being the largest exporter of subject merchandise to US market, was selected as a mandatory respondent for a detailed examination.

The AD case was prosecuted before the agency for one full year and involved submissions of huge amount of data, information and detailed arguments and rebuttal arguments by CS Wind as well as the US petitioner, WTTC.

DOC issued its Preliminary determination in July 2012, imposing 52.67% AD duty on CS Wind. Later, in the Final determination issued in December 2012, CS Wind obtained a slightly lower duty of 51.5%.

On account of such prohibitively high levels of duties, CS Wind was absolutely prevented from exporting to US market after July 2012.

Aggrieved with the agency decision, CS Wind challenged it before the lower court, CIT, in early 2013. CIT agreed with CS Wind on a number of issues and remanded the matter twice to DOC for reconsideration.

Over a period two plus years, when the appeal rested before CIT, CS Wind filed several more briefs before the lower Court as well as the agency and laid out its case in detail through oral arguments.

Ultimately, in its decision of May 2015, CIT ruled in favor of CS Wind on several issues, most notably, the valuation of steel plate. As a result, CS Wind’s AD duty dropped precipitously from 51.5% to 17.02% only.

This was indeed a significant victory for CS Wind. Even so, CIT ruled against CS Wind on three issues – weight adjustments, market economy purchases from Korea and financial ratios.

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CS Wind promptly challenged the lower Court’s decision before the superior Court, CAFC. Again, CS Wind filed extensive briefs before the superior Court and argued before a panel of three judges.

Finally, CAFC ruled in favor of CS Wind on the issue of weight adjustments and remanded the issue of financial ratios.

By winning the weight adjustments issue, CS Wind’s AD duty has further dropped to single digits, actually close to de minimis levels of 2%.

If CS Wind goes on to win the issue of financial ratios, its AD rate will drop below 2%, in which case the AD Order against CS Wind will be revoked, setting it free to export to the US market, unencumbered by the considerations of AD duty liabilities.

CS Wind’s remarkable turnaround in the litigation has happened on account of its victories on several surrogate value issues, most notably, valuation of steel plate.

Vietnam, being a non-market economy country, the DOC determines the fair value of goods based on surrogate value data from a third country.

In this case, the surrogate country is India. CS Wind’s surrogate value expert worked diligently over months in India, developing a new steel price database, Steelguru, which was ultimately accepted by the CIT.

Likewise, the surrogate value expert’s contribution was also notable in persuading the agency to prefer the financial statement of an Indian wind tower Co, Ganges Internationale, over several alternative financial statements proposed by WTTC.

The remanded issue, which would finally determine whether CS Wind is able to entirely escape the burden of AD duties, concerns the proper computation of financial ratios for the same Ganges’ financial statement.

As such, the high quality surrogate value information presented by CS Wind’s Counsel constitutes the single most important reason behind the astounding turnaround in this case.

CS Wind’s remarkable success story finally pitchforks the Vietnamese company to the status of a leading exporter of highly specialized and customized wind energy equipment to US market.

With its principal competitors - Chinese exporters - yanked out of the US market on account of a very high combined AD and CVD duties, CS wind stands to gain the bulk of the lucrative US market.

CS Wind’s success story, which is mainly driven by surrogate values, shows that similar successes could be replicated in other Vietnamese AD cases also.

As such, other foreign multinational heavy engineering goods’ producers are likely to establish their production and US export hub in Vietnam, infusing huge foreign investment in Vietnam and crating local job opportunities.

The country has finally and firmly catapulted itself from an agrarian base to an industrialized base.