ITA Issues Two Notices Seeking Comments on: Current Practices Involving Duty Drawback; Calculation of NME Wages in AD Proceedings

1. The policy of granting a duty drawback adjustment to export price when a respondent meets certain criteria; and
2. The practice of calculating expected non-market economy (NME) wages for use as surrogate values in AD proceedings involving NME countries.

ITA Seeks Comments on its Policy for Granting Duty Drawback Adjustments

The ITA explains that its has a long-standing policy of granting a duty drawback adjustment to export price where a respondent party establishes that: (1) the import duty paid and the rebate payment are directly linked to, and dependent upon, one another (or the exemption from import duties is linked to exportation); and (2) there were sufficient imports of the imported raw material to account for the drawback received upon the export of the manufactured product.

According to the ITA, it is considering whether changes to its current practice, including the above-described two-prong test, may be appropriate. The ITA's notice also describes various issues that have been raised concerning this practice. For instance, the ITA states that some parties have argued that the ITA's practice should be modified by requiring a respondent party seeking a duty drawback adjustment to demonstrate payment of import duties on raw material inputs used to produce merchandise sold in the home market.

Among other things, this notice includes an appendix containing certain questions that commenters may address, including possible changes to the current practice. The ITA states that comments must be submitted by July 25, 2005.

ITA Seeks Comments on Calculation of Expected NME Wages

In a second notice, the ITA has announced that it is seeking comments on its long-standing practice of calculating expected NME wages for use as surrogate values in AD proceedings involving NME countries. These expected NME wages are calculated annually in accordance with certain ITA regulations.

The ITA's methodology for the calculation of expected NME wages is described in the notice. In addition, the ITA has calculated expected NME wages for 17 countries using currently available data for 2003 and the methodology described in the notice. The ITA notes that this calculation is a sample that is subject to updates and revisions.

According to the ITA, comments on the expected NME wage policy must be received no later than August 1, 2005.

ITA Contacts - John Kalitka (duty drawback) (202) 482-2730

John LaRose (NME wages) (202) 482-3794

ITA Duty Drawback Notice (FR Pub 06/30/05) available at http://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/E5-3441.pdf

ITA NME Wages Notice (FR Pub 06/30/05) available athttp://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/05-12862.pdf

BP Note

The ITA has previously explained that it is involved in an ongoing effort to consider modifications to its policies and practices for AD proceedings involving NMEs. The ITA instituted two changes of practice in April 2005 and issued notices in May and June 2005 seeking comments on other possible changes involving NMEs.

(See ITT's Online Archives or 04/11/05 news, 05041110, for BP summary of the ITA's two changes in practice regarding AD duty investigations involving NMEs. See ITT's Online Archives or 06/06/05 and 06/27/05 news, 05060615 and 05062715, for BP summaries of the ITA's notices seeking comments on possible changes to its NME practices regarding AD duty proceedings.)