Trading with the NME: The Legacy of Judge Restani’s GPX Decisions

Jennifer M. Smith-Veluz - The Bristol Group PLLC
Vol. 58
Page 107

In GPX International Tire Corp. v. United States, Judge Restani noted that the decision of the U.S. Department of Commerce (“Commerce”) to apply the countervailing duty (“CVD”) statute to China — a nonmarket economy (“NME”) country — was a “sea change.” Judge Restani recognized Commerce’s broad discretion under the CVD statute, but she held that Commerce’s failure to address the potential for double counting of domestic subsidies in its simultaneous application of CVDs with antidumping duties under the NME methodology was unreasonable. After the U.S. Court of Appeals for the Federal Circuit affirmed on other grounds, Congress quickly enacted a legislative fix, which was framed based on the concerns expressed in Judge Restani’s decisions. Since then, CVDs have become a critical tool to counter unfair trade practices in China and other NME countries. Judge Restani’s decisions remind us that Commerce has flexibility in applying the CVD statute to address new challenges, although Commerce’s discretion is not unbounded — and sometimes Congress must step in to craft new solutions.

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