NEW YORK Omitting Chinese oil country tubular goods (OCTG) that are heat-treated and finished in third-party countries from countervailing and anti-dumping duties could be "absolutely devastating for the U.S. industry," according to counsel for U.S. Steel Corp.
Prior to the imposition of the duties in 2010, "massive" shipments from the Asian nation "literally shut down or idled the vast majority of the U.S. industry." The same fate awaits the U.S. market if the exemption is made, as "vast excess capacity" for the product still exists in China, attorneys at Washington law firm Skadden, Arps, Slate, Meagher & Flom LLP wrote in an April 11 submission to Deputy Secretary of Commerce Rebecca Blank.
But Bell Supply Co. LLC, a Gainesville, Texas-based importer of Chinese green tube processed in Indonesia, argued that the finishing represents a "substantial transformation," and thus should alter the products country of origin. This would be consistent with a 2010 finding by U.S. Customs and Border Protection.
"(PT Citra Tubindo Tbks) OCTG products are Indonesian, not Chinese," attorneys at Morris, Manning & Martin LLP, Washington, counsel for Bell, said in a submission to the Commerce Departments International Trade Administration (ITA). Bell distributes OCTG that is heat treated and finished by the Indonesian processor from Chinese substrate.
Bells counsel also disagreed with the assessment by Pittsburgh-based U.S. Steel that the transformed tube should automatically be covered under the orders, as there was no explicit reference to the product when the duties were set.
The ITA initiated a scope inquiry June 20 following a request for clarification by the domestic industry in March 2012.