WASHINGTON (Dec. 21, 2011)—The federal appeals court in Washington has ruled that the U.S. Commerce Department did not have the authority in 2008 to impose countervailing duties on certain OTR tires from China.
The ruling by a three-judge panel affirms a position taken by the U.S. Court of International Trade in September 2009 and reconfirmed in August 2010 that countervailing duties cannot be applied to goods from non-market economy countries.
In the ruling, written by Judge Timothy Dyk, the court found that the U.S. Congress, in amending and re-enacting international trade laws in 1988 and 1994, adopted the position that countervailing duty law does not apply to NME nations and therefore only Congress can remedy any inadequacies in trade law that don't protect U.S. industry from perceived unfair competition.
It's not clear what the next step in the process is. The Commerce Department has continued to collect the countervailing duties on the tires — those up to 39 inches in rim diameter — throughout the appeals process.
The case already has been reviewed, overturned and appealed at least twice.
The case — GPX International Tire Corp. and Hebei Starbright Tire Co. Ltd. and Tianjin United Tire & Rubber International Co. Ltd. vs. the U.S., Titan Tire Corp., the United Steel Workers International and Bridgestone Americas Inc. — was filed originally in December 2008 in reaction to stiff import and countervailing duties filed in 2008 against a number of Chinese OTR tire makers.
GPX International, the primary plaintiff, has gone out of business. It was forced to file for bankruptcy in late 2009, in part, it said at the time, because of financial complications caused by the tariffs, which amounted to 43.9 percent of value on tires from GPX's OTR tire-manufacturing subsidiary, Hebei Starbright.
Hebei Starbright was purchased by Maine Industrial Tire L.L.C. in late 2009, which in turn sold the plant's pneumatic tire assets in March 2011 to Sweden's Trelleborg A.B.