# Petition for Writ of Certiorari — International Union of Electronic v. United States > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386002_1261%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1994 - **Citation:** 512 U.S. 1204 ## Text Suprema Court, U.S, Fit ; _ = A 931328 Fee 1 6 1994 No. 93- —=GFFICE-GF THE CLERK In The Supreme Court of the United States October Term, 1993 * INTERNATIONAL UNION OF ELECTRONIC, ELECTRICAL, TECHNICAL, SALARIED AND MACHINE WORKERS, AFL-CIO, INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS, AND INDUSTRIAL UNION DEPARTMENT, AFL-CIO, Petitioners, UNITED STATES OF AMERICA, Respondent. ¢ Petition For Writ Of Certiorari To The United States Court Of Appeals For The Federal Circuit ¢ PETITION FOR WRIT OF CERTIORARI 4 Paut D. CULLEN* JerFReY S. BECKINGTON CoLuER, SHANNON, Ritt & Scott 3050 K Street, N.W. Washington, D.C. 20007 (202) 342-8400 Counsel for Petitioners *Counsel of Record COCKLE LAW BRIEF PRINTING CO., (800) 225-6964 QUESTIONS PRESENTED 1. Whether the Federal Circuit erred sn extending deference to the Commerce Department’s ii:terpretation of Section 772(u)(1)(C) of the Tariff Act of 1930, as amended, when the words of the statute make it clear that Congress intended United States Price to be tax- inclusive only to the extent Foreign Market Value is shown by a foreign respondent likewise to be tax-inclu- sive. 2. Whether an interpretation of Section 772(d)(1)(C) offered on appeal by the Department of Justice is entitled to deference by a reviewing court where that interpreta- tion flatly contradicts interpretations previously announced by the client agency itself in formal adminis- trative proceedings and where the interpretation is incon- sistent with the plain meaning of the words used in the statute. 3. Whether the Federal Circuit erred in extending deference to the Commerce Department's interpretation of Section 737(a) of the Tariff Act of 1930, as amended, that a cap mav be placed on the financial liability of foreign responuents for the payment of antidumping duties secured by bonds on merchandise imported during the period of the original antidumping investigation, when the express terms of the statute extend that cap only to obligations secured by cash deposits. RULE 29.1 STATEMENT The International Union of Electronic, Electrical, Technical, Salaried and Machine Workers, AFL-CIO, International Brotherhood of Electrical Workers, and the Industrial Union Department, AFL-CIO, are domestic labor organizations representing workers who are engaged in the manufacture in the United States of color television receivers.* None of the labor organizations is a publicly owned corporation that issues shares to the pub- lic. * Parties to the proceeding whose names do not appear in the caption of the case are Zenith Electronics Corporation; Sam- sung Electronics Co., Ltd.; Samsung Electronics America, Inc.; Daewoo Electronics Co., Ltd.; Daewoo Electronics Corp. of America, Inc.; Goldstar Co., Ltd; and Goldstar Electronics International, Inc. TABLE OF CONTENTS Page QUESTIONS PRESENTED .......-----+s+eeereeeee: i RULE 29.1 STATEMENT .......------+e seer rerrrees ii TABLE OF AUTHORITIES.........-----eeeeeeeeee: iv OPINIONS BELOW.........---:se cere teeter tee? 2 JURISDICTION .....-.--- eee ee cece eer ener eceeceee: 2 STATUTES INVOLVED ........--- eee sree creer 3 STATEMENT OF THE CASE.......---+-++eee errr: 4 1. The U.S. Antidumping Law......--.--++++++ 4 2. Proceedings Before The International Trade Administration. ........--02seeeee cere rer eeee: 6 3. Proceedings Before The U.S. Court Of Interna- Horal TAGE ...-.csecvccccvcceseveseveess 8 4. The Appeal To The Federal Circuit........... 11 a. The Adjustment to United States Price for Indirect TaX@S ......-cccccccccervecccscess 11 b. Liability for the Payment of Antidumping Duties Is Not Capped When Payment Is Secured by Bonds Rather Than Cash ..... 16 REASONS FOR GRANTING THE WRIT ........--- 19 ‘oi. GF) 68 eee 24 iv TABLE OF AUTHORITIES Page FEDERAL CASES American Dental Ass‘n v. Shalala, 3 F.3d 445 (D.C. See Qe os vein eevee desea er ee ee 20 Bowen v. Georgetown Univ. Hosp., 488 U.S. 204 CU PUEE 0 4.64 da ish ee0cnnb caeedn eee 23 Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, reh'g denied, 468 U.S. SAGE COPED f 600.560 bie RSV Ee ee ee passim Coalition for Clean Air v. Southern Cal. Edison Co., 971 F.2d 219 (9th Cir. 1992), cert. denied, EPA v. Coalition for Clean Air, 113 S.Ct. 1361 (1993)....... 20 Daewoo Elecs. Cv. v. International Union of Elec., 6 Fite S50) (Ped, (20 BO ieccnc base passim Daewoo Elecs. Co. v. United States, 712 F. Supp. 931 ee ee B Pee Te Cry TC ee ote passim Daewoo Elecs. Co. v. United States, 760 F. Supp. 200 ee. | errr ey ioe perme se 2,40, 11 Daewoo Elecs. Co. v. United States, 794 F. Supp. 389 eg BE, : Rerpeirapere rane 8 hp Neo cee ah ih y oh Estate of Cowart v. Nicklos Drilling Co., 112 S. Ct. EOE SAUTE waht steed chee chu atesdskiehateperce: 17 Oberstar v. Fed. Deposit Ins. Corp., 987 F.2d 494 (8th Le: SPWM chai ciate suas cienivnendeerereeieeeess 20 Public Employees Retirement System of Ohio v. Betts, Te A Se CRUE nc 5s iE ods dencodsreeiredeerenss 16 United States v. H. Rosenthal Co., 609 F.2d 999 OS eg PEE ORT ETO er eee te err ry errr 22 Zenith Elecs. Corp. v. United States, 633 F. Supp. Se ee: Pe I: I oe 6 5 is b's eke vee ok oe g Zenith Radio Corp. v. United States, 437 U.S. 443 ERs erm alee UA eon rales re eA eves a Met 20 Vv TABLE OF AUTHORITIES - Continued Page Supreme Court Rule 29.1 .......- 0. eee eee reer ees e ii STATUTES AND REGULATIONS Tariff Act of 1930, as amended (codified in scattered sections of 19 U.S.C.) Section 707(a) (19 U.S.C. § 1671f(a))..........---+- 17 Section 731 (19 U.S.C. § 1673) ....... cece reece eee 4 Section 733(d)(a) (19 U.S.C. § 1673b(d)(2)).....----- 6 Section 737(a) (19 U.S.C. § 1673f(a)).........-- passim Section 751(a) (19 U.S.C. § 1675(a)) ....-----++ee 4,7 Section 772(d)(1)(C) (19 U.S.C. § 1677a(d)(1)(C)). . . passim 6 USC: 6 CIES nics nee 3 0 USE. OO oe ecscorsees oees 19 19 CEE BO a i eee, 18 19 CER 6 M98 GON... bone neers 18 Federal Courts Improvement Act of 1982, Pub. L. No. 97-164, 96 Stat. 25 (codified in scattered gacticons GF TE UG). uscncccceectandssenensettass 19 ADMINISTRATIVE DETERMINATIONS Antidumping Duty Order; Color Television Receivers from Korea, 49 Fed. Reg. 18,336 (April 30, 1984) ..... 7 Antidumping Duties: Provisional Measures Deposit Cap, 57 Fed. Reg. 45,769 (Oct. 5, 1992)........-+-: 18 Vi LABLE OF AUTHORITIES — Continued Page Color Television Receivers from Korea; Final Results of Administrative Review of Antidumping Duty Order, 49 Fed. Reg. 50,420 (Dec. 28, 1984).......... 7 Final Determination of Sales at Less Than Fair Value; Color Television Receivers from Korea, 49 Fed. Reg. Fon {meee by Fee ccone cede eee AS CONGRESSIONAL REPORTS H.R. Rep. No. 1, 67th Cong., Ist Sess. (to accom- DRY Fite, SER) CEMENT 66 6bei purer eer bho twas; 21 S. Rep. No. 1619, 85th Cong., 2d Sess. (to accom- pasty Ft... GGles LESOGe ores valk chdeas ce tracked i dews 22 MISCELLANEOUS Dept. of the Treas., U.S. Customs Service, “Annual Report on the Status of the Antidumping / Countervailing Duty Program,” Nov. 21, 1993..... 19 In The Supreme Court of the United States October Term, 1993 4 No. 93- = — INTERNATIONAL UNION OF ELECTRONIC, ELECTRICAL, TECHNICAL, SALARIED AND MACHINE WORKERS, AFL-CIO, INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS, AND INDUSTRIAL UNION DEPARTMENT, AFL-CIO, Petitioners, UNITED STATES OF AMERICA, Respondent. —_—_—_—— ¢@ —_____-_—____—_- Petition For Writ Of Certiorari To The United States Court Of Appeals For The Federal Circuit + PETITION FOR WRIT OF CERTIORARI ¢ Petitioners, International Union of Electronic, Electri- cal, Technical, Salaried and Machine Workers, AFL-CIO, International Brotherhood of Electrical Workers, and Industrial Union Department, AFL-CIO, respectfully pray that a writ of certiorari issue to review -he judgment of the United States Court of Appeals for the Federal Circuit, entered in the above proceeding on September 30, 1993, rehearing denied, November 18, 1993. ° OPINIONS BELOW The opinion of the Court of Appeals for the Federal Circuit, Daewoo Elecs. Co. v. Int'l Union of Electronic, Elec- trical, Technical, Salaried and Machine Workers, AFL-CIO (“Daewoo IV”), is reported at 6 F.3d 1511 (Fed. Cir. 1993) and is reprinted at pages 3-34 of the appendix to this petition (“Pet. App.”). On November 18, 1993, the Court of Appeals for the Federal Circuit denied the Petitioners’ Petition for Rehearing and Suggestion for Rehearing In Banc. The order is reprinted at pages 1 to 3 of Pet. App. The Federal Circuit overturned decisions of the United States Court of International Trade in Daewoo Elecs. Co. v. United States, 712 F. Supp. 931 (Ct. Int’l Trade 1989) (“Daewoo I’) and Daewoo Elecs. Co. v. United States, 794 F. Supp. 389 (Ct. Int’l Trade 1992) (“Daewoo III”). The opin- ion of the Court of International Trade in Daewoo I is reprinted at 69-138 of Pet. App.; the opinion of the Court of International Trade in Daewoo III is reprinted at pages 35-44 of Pet. App. The opinion of the Court of Interna- tional Trade in Daewoo Elecs. Co. v. United States, 760 F. Supp. 200 (Ct. Int’l Trade 1991) (“Daewoo II”) is reprinted at pages 45-68 of Pet. App. one ¢ JURISDICTION The judgment of the Court of Appeals for the Federal Circuit was entered on September 30, 1993. A Petition for Rehearing and Suggestion for Rehearing In Banc was denied on November 18, 1993. The jurisdiction of this Court to review the judgment is invoked under 28 U.S.C. § 1254(1). + STATUTES INVOLVED Section 772(d)(1)(C) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1677a(d)(1)(C) (1988), provides in pertinent part as follows: The purchase price and the exporter’s sales price shall be adjusted by being .. . increased by ... the amount of any taxes imposed in the country of exportation directly upon the exported merchandise or components thereof, which have been rebated, or which have not been collected, by reason of the exportation of the merchandise to the United States, but only to the extent that such taxes are added to or included in the price of such or similar mer- chandise when sold in the country of exporta- tion. Section 737(a) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1673f(a) (1988), provides as follows: If the amount of a cash deposit collected as security for an estimated antidumping duty under section 1673b(d)(2) of this title is different from the amount of the antidumping duty deter- mined under an antidumping duty order issued under section 1673e of this title, then the differ- ence for entries of merchandise entered, or with- drawn from warehouse, for consumption before notice of the affirmative determination of the Commission under section 1673d(b) of this title is published shall be - (1) disregarded, to the extent that the cash deposit collected is lower than the duty under the order, or (2) refunded, to the extent the cash deposit is higher than the duty under the order. S STATEMENT OF THE CASE 1. The U.S. Antidumping Law Ihe U.S. antidumping law requires the assessment of antidumping duties if two conditions are met: (1) the International Trade Administration of the U.S. Depart- ment of Commerce (hereinafter “the Department” or “the ITA”) determines that the imported merchandise is being sold at less than fair value; and (2) the U.S. International frade Commission (hereinafter “the ITC”) determines that a U.S. industry is materially injured or threatened with material injury by reason of imports of that mer- chandise. 19 U.S.C. § 1673 (1988). If the Department determines that less than fair value sales exist and the ITC makes an affirmative injury determination, an anti- dumping duty order is issued. Imported merchandise covered by such an order is subject to the imposition of a special antidumping duty equal to the amount by which Foreign Market Value exceeds the United States Price for the merchandise. 19 U.S.C. § 1675(a) (1988). This amount is referred to as the “dumping margin.” lhis case involves the methodology specified in the antidumping law to adjust for indirect taxes which are imposed on sales in the country of exportation, but which are rebated, or forgiven, on exports to the United States. An adjustment in the price comparison is necessary to ensure that a dumping margin is not created solely because a tax-inclusive Foreign Market Value is compared to a tax-exclusive United States Price. In 1921, Congress incorporated a provision in the antidumping law designed to adjust for the absence of tax 1. United States Price by adding to that price an amount equal to the tax that would have been imposed on the merchandise but for the fact of exportation. An upward adjustment to United States Price tends to lower a potential margin of dumping by narrowing the difference between the Foreign Market Value and the relatively lower United States Price. In 1974, Congress amended the law by placing limitations on the upward adjustment to United States Price with respect to this tax adjustment. The law as presently written provides for an upward adjustment to United States Price by: [T]he amount of any taxes imposed in the coun- try of exportation directly upon the exported merchandise or components thereof, which have been rebated, or which have not been collected, by reason of the exportation of the merchandise to the United States, but only to the extent that such taxes are added to or included in the price of such or similar merchandise when sold in the coun- try of exportation; .... Section 772(d)(1)(C) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1677a(d)(1)(C) (1988) (emphasis added). By limiting the upward adjustment to United States Price, Congress ensured that margins of dumping would not be reduced in cases where the full amount of the tax was not included in Foreign Market Value. This case also involves the question of how much antidumping duties may be collected for entries of mer- chandise imported during the original antidumping investigation before an antidumpiny duty order has been published. Under Section 733(d)(2) of «he Act, foreign respondents must secure their obligations to pay anti- dumping duties during this period either by posting a bond or by making cash deposits in an amount equal to the estimated duty. 19 U.S.C. § 1673b(d)(2) (1988). Korean companies covered their estimated duty obligations for this period by posting bonds rather than by making cash deposits. Pet. App. 28. Section 737(a) limits the antidump- ing liability on such entries and expressly states that the difference between a cash deposit of estimated antidump- ing duties and the final antidumping duty determined shall be “disregarded, to the extent the cash deposit col- lected is lower than the duty under the order.” 19 U.S.C. § 1673ft(a) (1988) (emphasis added). No provision is made for the limitation of liability when that liability is secured by bonds. 2. Proceedings Before The International Trade Administration Petitioners are labor organizations who represent workers engaged in the manufacture of color television receivers (“CTVs”) in the United States. On May 2, 1983, Petitioners filed a petition seeking relief under the anti- dumping law from the harmful effects of dumped imports of CTVs from Korea. During the original anti- dumping investigation, the Petitioners argued that mea- surement of home market taxes was required by the statute to ascertain the extent to which Foreign Market Value was tax-inclusive before any upward adjustment to United States Price is made under Section 772(d)(1)(C). he Department conceded the correctness of this posi- tion, but nevertheless failed to follow the statute: [I]t is only reasonable to conclude that the Con- gress, in its addition to section 772(d)(1)(C) of the “but only to the extent” language, intended that we measure absorption and limit the addi- tion to the tax passed through. However, it is impossible to do so... . [thus] the Department has presumed full pass through in this investi- gation. Final Determination of Sales at Less Than Fair Value; Color Television Receivers from Korea, 49 Fed. Reg. 7620, 7624 (Mar. 1, 1984). The Department “presumed full pass through” in the original investigation and failed to undertake any measurement of tax included in the price of the sale in the Korean home market. Nevertheless, the Department issued an antidumping duty order against CTVs from Korea. Antidumping Duty Order; Color Televi- sion Receivers from Korea, 49 Fed. Reg. 18,336 (April 30, 1984). Thereafter, the Department initiated an administra- tive review of antidumping duties under Section 751(a) of the Act, 19 U.S.C. § 1675(a) (1988). During this first annual review, the Department once again conceded that the statute required that the amount of the upward adjustment to United States Price should be limited to the amount of tax actually included in the price to purchasers in the home market. Nevertheless, the Department failed to conduct such a measurement and instead “assumed full pass-through” of the taxes. Color Television Receivers from Korea; Final Results of Administrative Review of Antidumping Duty Order, 49 Fed. Reg. 50,420, 50,421 (Dec. 28, 1984). The Department found that the three Korean CTV manufacturers under review, Daewoo, Goldstar, and Samsung, were dumping CTVs in the United States at margins of 14.88 percent, 7.47 percent, and 12.23 percent, respectively. The Department's final determination in this first administrative review is the subject of this litigation. 3. Proceedings Before The U.S. Court Of Interna- tional Trade Petitioners filed an appeal with the U.S. Court of International Trade challenging the determination by the Department that it was free to assume that 100 percent of the taxes had been included in the foreign market price. Petitioners, relying on the plain meaning of the words of the statute, contended that the Department is obliged to limit the upward adjustment to United States Price on account of taxes included in the Foreign Market Value by measuring “the extent that such taxes are added to or included in the price of such or similar merchandise when sold in the country of exportation.” 19 U.S.C. § 1677a(d)(1)(C) (1988). The Court of International Trade found that the Department’s contrary interpretation of Section 772(d)(1)(C) was “not in accordance with the law.” Daewoo I, Pet. App. 125. Application of Section 772(d)(1)(C) necessarily involves two separate questions. The first concerns whether this statutory provision requires the ITA to mea- sure the extent to which Foreign Market Value is tax- inclusive. If this first question is answered in the affirma- tive, the second question asks how this measurement is to be made. In Daewoo I, the Court found that Section eo 772(d)(1)(C) requires such a measurement. The Court did not attempt to resolve the second question. Rather, it remanded the proceeding to the ITA so that it could determine how that measurement was to be made. Thus, the opinion in Daewoo I clearly states: The Court finds that the Zenith case is con- trolling in its holding and reasoning that Com- merce’s interpretation of Section 772(d)(1)(C) of the Act is not in accordance with the law and that the final results of this administrative review are not supported by the evidence on the record with regard to this issue. The Court remands this issue to the ITA for reconsidera- tion in accordance with this opinion. Pet. App. 125. The opinion of Senior Judge Watson in Zenith Elecs. Corp. v. United States, 633 F. Supp. 1382 (Ct. Int'l Trade 1986), which served as the bedrock upon which Daewoo | rests, states as follows: Although § 1677a(d)(1)(C) requires the ITA to measure actual! tax absorption, it leaves the precise method of performing this measurement to the discretion of the agency. .. . [t]he agency must find a methodology for measuring absorption which it considers satis- factory and must base its measurements upon substantial evidence. The court leaves open whether the simple method of subtracting after-invoice discounts and rebates from gross invoice prices, suggested by Zenith and the Unions below, is sufficient, or whether an econometric approach is required. . . . 633 F. Supp. at 1400. we 10 On remand following Daewoo I, the ITA elected to embark upon an econometric analysis of tax incidence in the Korean color television market. On the basis of its econometric analysis, the ITA concluded that the full amount of the taxes imposed on Korean televisions in the home market was included in the price paid and that no limitation on the upward adjustment to United States Price was necessary under Section 772(d)(1)(C). The results of this first remand were before the Court of International Trade in Daewoo II. The Court of Interna- tional Trade evaluated the econometric analysis under- taken by the ITA and found that it was not supported by substantial evidence. Pet. App. 57-59. The Court gave specific instructions to the ITA respecting legal and evi- dentiary deficiencies in its econometric analysis. Id. It is important to note, however, that those instructions came only after the ITA had decided to use an econometric analysis to measure the extent to which indirect taxes were included in the home market price. The instructions of the Court of International Trade in Daewoo II should not be confused as a directive to the ITA to use an econometric approach. During the second remand following Daewoo II, the ITA continued to follow the econometric approach begun in the first remand. Korean respondents tried to support the first remand result with additional evidence and expert econometric analysis. Eventually, Korean respon- dents abandoned their analysis and offered a totally dif- ferent approach, which they believed would still support a finding that 100 percent of the home market taxes were included in the foreign market price. Commerce con- cluded that this second analysis was flawed and decided 1] to base its tax measurement on an analysis advanced by an expert witness offered by Zenith Electronics Corp., a domestic producer of color televisions. Pet. App. 13. PI Daewoo III followed the second remand determina- tion. The Court of International Trade accepted the results of the second remand, which had found that less than 100 percent of the taxes imposed in the Korean home market were included in the foreign market price of the merchandise. Accordingly, the amount of the upward adjustment to United States Price required under Section 772(d)(1)(C) became smaller, and the margin of dumping for the principal Korean color television producers went up substantially.! 4. The Appeal To The Federal Circuit a. The Adjustment to United States Price for Indirect Taxes The ITA appealed the decisions of the Court of Inter- national Trade in Daewoo I and Daewoo III. It did not appeal directly from Daewoo I]. On appeal to the Court of Appeals for the Federal Circuit, that Court seriously mis- apprehended the nature of the decision of the lower court in Daewoo I: We address the propriety of the following hold- ings in the Daewoo opinions: that 19 U.S.C. ~ § 1677a(d)(1)(C) of the antidumping law | The ad valorem margins of dumping for Daewoo, Goldstar, and Samsung grew from 14.88, 7.47, and 12.23 percent, respec- tively, in the Department's original finding to 48.18, 33.95, and 30.36 percent, respectively. Pet. App. 7. —_ 12 requires that ITA make an econometric analysis of tax incidence in foreign markets (Daewoo ee Pet. App. 7-8. The Federal Circuit overturned the finding of the Court of International Trade that the plain meaning of Section 772(d)(1)(C) required the ITA to measure taxes in the home market. The Federal Circuit’s ruling that the ITA is not required to measure tax incidence is based largely on the perceived inadequacies and burdens of the econometric approach selected by Commerce. Pet. App. 12, 21-22. The Federal Circuit deferred to the Depart- ment’s interpretation of Section 772(d)(1)(C), noting that it “has recognized the ITA as the ‘master’ of [the] anti- dumping law” and that the tenets expressed in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 843, reh’g denied, 468 U.S. 1227 (1984), “extend to their limits when the ITA interprets the antidumping laws.” Pet. App. 16. The Federal Circuit’s decision to defer to the ITA’s interpretation under the principles set forth in Chevron was plainly wrong. The rule in Chevron requires a two- part analysis: When a court reviews an agency’s construction of the statute which it administers, it is con- fronted with two questions. First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unam- biguously expressed intent of Congress. If, how- ever, the court determines Congress has not 13 directly addressed the precise question at issue, the court does not simply impose its own con- struction on the statute, as would be necessary in the absence of an administrative interpreta- tion. Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute. (footnotes omitted). 467 U.S. at 842-43 (emphasis added). The Federal Circuit bypassed completely step one of the Chevron analysis, never addressing the critical ques- tion of whether the statute is ambiguous or open to more than one interpretation. Had the Federal Circuit under- taken step one of the Chevron analysis, it would have seen that the unambiguous wording of Section 772(d)(1)(C) requires the Department to limit the upward adjustment to United States Price by measuring the extent to which taxes are included in the home market price. At the same time, the statute leaves open to the Department’s discre- tion the precise methodology to be used in conducting that measurement. But ambiguity with respect to how the tax measurement should be made does not imply ambi- guity as to whether some measurement should be made. The Federal Circuit’s opinion points to the perceived burdens and shortcomings of the econometric approach taken by the Department on remand following Daewoo I. The Federal Circuit mistakenly believed that the Court of International Trade ordered the Department to conduct an econometric analysis in Daewoo I: The trial court held that the final clause of sec- tion 1677a(d)(1)(C), allowing augmentation of ——————— 14 USP “only to the extent that such taxes are added to or included in the price of such or similar merchandise when sold in the country of exportation,” compelled the ITA to analyze the consumer tax incidence of the commodity taxes. Ihus, instead of employing an accounting approach that allows USP to be increased by the full amount of the tax levied and paid on home market sales, the court reasoned that the ITA must undertake an econometric study of the Korean mar ket to determine the tax incidence, or “pass through,” of the commodity taxes upon con- sumers. (Emphasis added.) Pet. App. 10-11. As shown above, however, the opinion in Daewoo I made it clear that the court ordered only that the Department conduct a measurement of home market taxes. It left the precise methodology for conducting that measurement to the discretion of the Department. Supra at Y. [he Federal Circuit also concluded that there is no evidence that Congress intended to effect the kind of revolutionary change in the antidumping law that is nec- essarily implied by an obligation to conduct an economet- ric analysis of tax incidence. Therefore, the Federal Circuit asserted that it could not say that the ITA’s inter- pretation contravenes the statute. Pet. App. 20. The fal- lacy of this argument lies in the assumption that the court in Daewoo I read the statute as requiring an econometric analysis. Neither the Court of International Trade nor the Petitioners have ever taken the position that the statute mandates an econometric analysis, although such an analysis is clearly one option for measuring home market taxes. Supra at 9. The ITA decided to embark upon an econometric approach even though Petitioners JT were urging other alternatives. Id. The Federal Circuit's attempt to point to the ITA’s own bungled effort at econo metrics as proof that no measurement at all is required must be rejected as a misreading of Daewoo I and an unacceptable substitute for a step one ¢ hevron analysis fhe contention that the Department's only practical alternative on remand following Daewoo I was to conduct an econometric analysis is simply incorrect fhe Court of International Trade made reference to Petitioners’ con cerns over the tax treatment of after-sale discounts and rebates. Id. A measurement based upon imple allocation could easily form the basis for a limitation of the tax adjustment on United States Price. [he Department's improvident selection of an econometric approach was a self-inflicted wound which does not relieve it of the responsibility ty measure home market taxes and to limit the upward adjustment to United States Price under Se tion 772(d)(1)(C) Finally, the Federal Circuit suggests that the ITA has consistently interpreted Section 772(d)(1)(C) to require it merely to “examine customary business records of exporters” to determine whether the tax was included in the price and was paid to the government Pet. App. 16 if a Korean producer sells a color television for $100 plus $50 tax (tax-inclusive sales price $150) and then gives his customer a $15 post-sale discount or rebate, there are any number of accounting techniques available to determine how much of that $15 discount might be considered tax not included in the price and how mux} 01 the net selling price of $135 was tax lo The plain meaning of the statute requires more of the Department than a simple inquiry into whether a tax has been paid on the sale in the foreign market. The 1974 amendment that added the language, “but only to the extent that,” is robbed of all meaning if no quantitative measurement is required and no limitation on the upward adjustment to United States Price is imple- mented. If Congress intended to place no restrictions on the amount by which the Department may raise United States Price in the dumping margin calculation, it would not have used language that denotes both measurement and limitation. Even if a longstanding administrative practice existed, this would not permit the Department to iznore the plain meaning of the law.’ 1 sy b. Liability for the Payment of Antidumping Duties Is Not Capped When Payment Is Secured by Bonds Rather Than Cash The Federal Circuit also addressed the issue of whether the financial responsibility of Korean respon- dents for the payment of antidumping duties was capped by the amount of the bonds that they had posted during the period of investigation. Section 737(a) of the Tariff Act * A detailed examination of the record discloses that there was no longstanding administrative practice by the Depart- ment. Even .f such a practice existed, however, it would not justify actions that are in conflict with the clear intent expressed in Section 772(d)(1)(C). See, e.g., Public Employees Retirement Sys- tem of Ohio v. Betts, 492 U.S. 158, 171 (1989) (noting that “[e]ven contemporaneous and longstanding agency interpretations must fall to the extent they conflict with Statutory language.”). 17 of 1930, as amended, expressly limits respondents’ obli- gations to the amount of cash deposits made. The terms of the statute do not extend this cap to liabilities sec ured by bonds [he Federal Circuit overruled the Court of Interna- tional Trade and sided with the Department on this mat- ter, holding that the Korean companies’ final anti dumping, liability was limited to the amount of their estimated antidumping duties secured by bonds. In reaching this result, the Federal Circuit emphasized the need for great deference to the Department as the admin- istering authority and its purportedly longstanding, con temporaneous interpretation of the statute. The Federal Circuit additionally stressed that section 737(a) does not explicitly prohibit the capping of antidumping liability when bonds have been posted, construing this “silence” as further support for its conclusion that the Depart ment’s reading is not unreasonable. Pet. App. 30 [he Department found ambiguity in the statute where none exists. A step one Chevron analysis would have disclosed that Congress spoke directly and unequiv- ocally to the question of when final antidumping liability can be limited to the estimated antidumping liability. Section 737(a)’s plain words authorize a cap only when a cash deposit has been posted. Had Congress so intended, it would have extended the cap to bonds, as it did in section 707(a) of the Tariff Act of 1930, as amended, 19 U.S.C. § 1671f(a), with regard to countervailing duties. Rather than adhere to “the basic and unexceptional rule that courts must give effect to the clear meaning of statutes as written,” Estate of Cowart v. Nicklos Drilling Co., 18 112 S. Ct. 2589, 2594 (1992), the Federal Circuit resorted to an inappropriate and unreasonable analysis of legislative and regulatory history. In fact, the Department's contem- poraneous reading of section 737(a) was faithful to the statute and capped antidumping liability only to “the amount of the estimated antidumping duty deposited.” 45 Fed. Reg. 8182, 8204 (Feb. 6, 1980) (codified at 19 C_ER. § 353.50 (1980)). The Department changed its position on the cap issue once in 1989, extending the benefits of the cap to obligations secured by bonds. It then changed its position a second time in 1992, limiting the cap to obliga- tions secured by cash deposits.4 The Federal Circuit seems to have gotten out of step with the Department's latest position on this issue, having deferred to the Department’s 1989 policy after the Department had reversed that policy in 1992. The Federal Circuit should have decided this matter, as the Court of International Trade did,® on the basis of a straight-forward analysis under step one of Chevron rather than extending unfet- tered deference to the administrative agency. —_—_—__—¢ * The Department formally changed its regulations in 1989 to extend the cap to bonds as well as to cash deposits. 54 Fed. Reg. 12,742, 12,779 (Mar. 28, 1989) (codified at 19 C_ER. § 353.23 (1989)). More recently, the Department reverted to its original interpretation limiting the cap to imports secured by cash deposits in keeping with section 737(a). Antidumping Duties: Provisional Measures Deposit Cap, 57 Fed. Reg. 45,769 (Oct. 5, 1992). > Pet. App. 43-44 and case cited therein. 19 REASONS FOR GRANTING THE WRIT 1. The U.S. Court of Appeals for the Federal Circuit is a court of specialized jurisdiction. 28 U.S.C. § 1295 (1988). It provides the only appellate review available for antidumping and countervailing duty trade cases brought under Title VII of the Tariff Act of 1930. Deci- sions of the Federal Circuit in matters involving interna- tional trade law are, to some extent, shielded from review by this Court because there can never be a split with other circuits on substantive issues within the Court's area of specialized jurisdiction. When the Federal Circuit errs, however, its error endures, affecting all interested parties under the international trade laws.® The decision of the Federal Circuit in this proceeding demonstrates a fundamental misconception by that Court regarding its responsibilities for providing meaningful judicial review of agency action. The Federal Circuit's failure to apply the Chevron test properly has conse- quences under the international trade laws that range far beyond the specific issues raised in this petition. This Court has not reviewed a case arising under the international trade laws since before the Federal Circuit was created by the Federal Courts Improvement Act of 1982. Pub. L. No. 97-164, 96 Stat. 25 (codified in scattered 6 Figures for 1992 place the dollar value of commodities covered by antidumping or countervailing duty orders at $6.7 billion. Dept. of the Treas., U.S. Customs Service, “Annual Report on the Status of the Antidumping/Countervailing Duty Program,” Nov. 21, 1993. The Department of the Treasury, U.S. Customs Service estimates that imported merchandise covered by active antidumping and countervailing duty orders valued in excess of $9 billion was imported in 1993. sections of 28 U.S.C.). The last international trade case to be given plenary review by this Court was Zenith Radio Corp. v. United States, 437 U.S. 443 (1978). The time has come for this Court to issue a writ of certiorari to review a decision of the Federal Circuit in a trade case. 2. The Federal Circuit failed to engage in a careful and probing inquiry into whether Congress has spoken directly to the issues at hand. This stands in stark con trast to the approach taken by other circuits having long standing expertise in matters involving review of federal agency action.” The Federal Circuit effectively bypassed step one of the Chevron test by beginning its analysis with the unqualified statement that “[t]his question is one of statutory interpretation, which we must resolve with def- erence to the agency’s interpretation rather than to the court's.” Pet. App. 14. Rather than conduct a preliminary analysis of the statute to discern whether the intent of Congress was made clear in the language chosen, the Court referred to the ITA as the “master” of the anti- dumping law, Pet. App. 16, and stated that Chevron’s ' See, e.g., American Dental Ass'n v. Shalala, 3 F.3d 445, 446 (D.C. Cir. 1993) (explaining that under the two-step test of Chevron the court will “proceed to Chevron’s second step, and approve any reasonable agency construction of the statute, only if the statute is silent or ambiguous on the disputed point”) (emphasis in original); Oberstar v. Fed. Deposit Ins. Corp., 987 F.2d 494, 501 (8th Cir. 1993) (noting that the agency interpretation “does unacceptable violence to the plain language of the stat- ute”); Coalition for Clean Air v. Southern Cal. Edison Co., 971 F.2d 219, 228 (9th Cir. 1992), cert. denied, EPA v. Coalition for Clean Air, 113 S.Ct. 1361 (1993) (recognizing a duty under Chevron to “exhaust the ‘traditional tools of Statutory construction’ to determine if Congress has spoken to the precise question at issue”). 2] “tenets extend to their limits when the ITA interprets antidumping law.” Id. The Federal Circuit turned a blind eye toward the threshold question of whether Congress had spoken with sufficient clarity to determine whether it intended to limit the upward adjustment to United States Price when it amended the law in 1974 It is particularly distressing to see a court of spe cialized jurisdiction which by definition should itself possess specialized expertise —~ assume such a compliant position with respect to the agency over which it has been given exclusive jurisdiction. Moreover, the Federal Cir cuit’s subservience to decisions of the Department on pure questions of statutory interpretation was not tem pered in any way by the fact that the ITA’s interpretation significantly reduced the margin of dumping, thereby diminishing the remedial effect that the antidumping law is intended to afford domestic industries and their workers. The legislative history of the 1921 Act and the various amendments to that Act over the years establish that the antidumping iaw is designed to offset injurious, unfair pricing by means of antidumping duties. Under- stated dumping margins and the capping of liability for the payment of antidumping duties secured by bonds do not provide the effective deterrent intended by Con- gress.” 5 The House Report which accompanied the Antidumping Act 1921 sets forth the purpose of imposing antidumping duties: The principle underlying the proposed additional duty to be added in prevention of dumping [makes] it unprofitable to dump goods on the markets of the United States at lower prices. If the seller of the goods is compelled to add as duty the Se }. Even if there were ambiguity in the statute, the ITA’s interpretation would still not warrant deference here. The ITA has, on two previous occasions, publicly declared-an interpretation of the commodity tax provision in direct contradiction to its current position Supra at 7. The ITA freely admitted that Section 77 2(a\1)(C) called for measurement of the tax, but declined to do so, saying that it was impossible to make such a measurement. Difficulty in administering a statute is not, however, sufficient reason for an agency to ignore the express intent of Congress. United States v. H. Rosen thal Co., 609 F.2d 999, 1002 (CCPA 1979). Moreover, the proposition that the statute does not call for any measure- ment of foreign market taxes was offered for the first time on appeal by attorneys for the Department of Justice. This is precisely the sort of post-hoc litigation posture to which difference between the sales price and what he would receive by selling in the otherwise highest obtainable market, all reward or inducement to dumping is removed. H.R. Rep. No. 1, 67th Cong., Ist Sess. (to accompany H.R. 2435), at 23 (1921) The Senate Report accompanying the 1958 amendments to the 1921 Act also emphasized the regulatory goals of the anti- dumping law to act as a deterrent to dumped sales: The antidumping feature of our Tariff Act [H.R. 6006] is of considerable importance in protecting domestic industries from inroads of foreign goods sold or offered for sale at less than fair value. Not only will the improvements made by this bill assist in speeding up the operating procedure, they will strengthen the deterrent effect of the law and in that respect help to prevent dumping. S. Rep. No. 1619, 85th Cong., 2d Sess. (to accompany H.R. 6006), at 2 (1958) Ff this Court has refused to grant deference. Bowen v. Geor getown Univ. Hosp., 488 U.S. 204, 212 (1988). Similarly with its regulations governing the capping of antidump ing liability, the Department has shifted its view over time. Initially in 1980 and since October 1992 the Depart ment has correctly awarded this limitation only when estimated antidumping duties have been secured by cash deposits. The Justice Department's position on appeal is contrary to the currently stated policy of the Commerce Department and is entitled to no deference whatsoever Id 4. The Federal Circuit’s failure to implement the Chevron doctrine properly has important implications well beyond its interpretation of Section 772(d)(1)(C) and Section 737(a). Review of agency action is at the very core of the Federal Circuit’s appellate jurisdiction in trade cases. Excessive deference to agency determinations by the Federal Circuit deprives interested parties of effective judicial review in an area of jurisprudence of consider- able importance. Failure to provide a careful and probing inquiry under step one of the Chevron analysis tilts the whole process of judicial review decisively in favor of the government, which needs only to assert a permissible interpretation in order to prevail under Chevron’s step two. The role of the judiciary in our system of checks and balances is to resolve tension between Congress which writes the laws and the Executive Branch which executes them. The Chevron doctrine is an important and delicate instrument in maintaining a proper balance. Certiorari should be granted to restore that critical balance in the implementation of our laws regulating international trade. 24 CONCLUSION For the foregoing reasons the Writ should issue for review of the Federal Circuit’s decision extending defer- ence to the Department's interpretation of Sections 772(d)(1)((C) and 737(a) of the Tariff Act of 1930, as 1 amended. Respectfully submitted, Paut D. CULLEN JEFFREY S. BECKINGTON COLLIER, SHANNON, Ritt & Scott 3050 K Street, N.W. Washington, D.C. 20007 (202) 342-8400 Attorneys for Petitioners Washington, D.C. February 16, 1994 App. 1 UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT 92-1558,-1559,-1560,-1561,-1562 DAEWOO ELECTRONICS CO., LTD. and DAEWOO ELECTRONICS CORP. OF AMERICA, INC. Plaintiffs-Appellants, and SAMSUNG ELECTRONICS CO., LTD. and SAMSUNG ELECTRONICS AMERICA, INC., Plaintiffs-Appellants, and GOLDSTAR CO., LTD. and GOLDSTAR ELECTRONICS INTERNATIONAL, INC., Plaintiffs-Appellants, Vv. INTERNATIONAL UNION OF ELECTRONIC, ELECTRICAL, TECHNICAL, SALARIED AND MACHINE WORKERS, AFL-CIO, INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS OF AMERICA, INDEPENDENT RADIONIC WORKERS OF AMERICA and INDUSTRIAL UNION DEPARTMENT, AFL-CIO, Plaintiffs-Appellants, Vv. ZENITH ELECTRONICS CORP., Plaintiff-Appellee, Vv. THE UNITED STATES, Defendant-Appellant. ORDER ial App. 2 UNITED STATES COURT OF APPEALS FOR THE FEDERAL CIRCUIT ORDER A combined petition for rehearing and suggestion for rehearing in banc having been filed by the APPELLANT, and the petition for rehearing having been referred to the panel that heard the appeal, and thereafter the suggestion for rehearing in banc having been referred to the circuit judges who are in regular active service, UPON CONSIDERATION THEREOF, it is ORDERED that the petition for rehearing be, and the same hereby is, DENIED, and it is further ORDERED that the suggestion for rehearing in banc be, and the same hereby is, DECLINED. The mandate of the court will issue on November 26, 1993. FOR THE COURT, FRANCIS X. GINDHART, CLERK Dated: November 18, 1993 By /s/ Diane M. Frye Diane M. Frye Chief Deputy Clerk cc: DAVID A. GANTZ, WARREN E. CONNELLY FREDERICK L. IKENSON MICHAEL P. HOUSE, VELTA A. MELNBRENCIS PAUL D. CULLEN, BRUCE M. MITCHELL DAEWOO ELECTRONICS CO V US, 92-1558 (CIT — 85-01-00140) App. 3 DAEWOO ELECTRONICS CO., LTD. and Daewoo Elec- tronics Corp. of America, Inc., and Samsung Electronics Co., Ltd. and Samsung Electronics America, Inc., and Goldstar Co., Ltd. and Goldstar Electronics Interna- tional, Inc., Plaintiffs-Appellants, V. INTERNATIONAL UNION OF ELECTRONIC, ELEC- TRICAL, TECHNICAL, SALARIED AND MACHINE WORKERS, AFL-CIO, International Brotherhood of Electrical Workers of America, Independent Radionic Workers of America and Industrial Union Department, AFL-CIO, Plaintiffs-Appellants, V. ZENITH ELECTRONICS CORP., Plaintiff-Appellee, V. The UNITED STATES, Defendant- Appellant. Nos. 92-1558 to 92-1562. United States Court of Appeals, Federal Circuit. Sept. 30, 1993. Rehearing and Suggestion for Rehearing in Banc Denied Nov. 18, 1993. Korean television manufacturers appealed antidump- ing order. The Court of International Trade, 712 F.Supp. 931, remanded for reconsideration. The International Trade Administration (ITA) of Department of Commerce determined antidumping margins, and manufacturers appealed. The Court of International Trade, 760 F.Supp. App. 4 200, remanded for reconsideration. United States manu- facturer moved for final judgment on Department's redetermination of antidumping margins. The Court of International Trade, Watson, Senior Judge, 794 F.Supp. 389, affirmed as modified. Parties appealed. The Court of Appeals for the Federal Circuit, Nies, Chief Judge, held that: (1) ITA reasonably interpreted antidumping statute In using accounting methodology to add all commodity taxes assessed on home market sales but forgiven upon export, and ITA was not required to make econometric analysis of tax incidence on home market consumers; (2) ITA’s use of net delivered selling price to first unrelated customer as imputed commodity tax for calculating amount of tax adjustment was supported by substantial evidence; and (3) cap existed for antidumping duties irrespective of whether bond or cash deposit was posted as security. Attirmed in part; reversed in part and remanded. David A. Gantz, Reid & Priest, Washington, DC, argued, for plaintiffs-appellants, Daewoo Electronics Co., Ltd. and Daewoo Electronics Corp. of America, Inc. With him on the brief, were Elizabeth H. Lefebvre and Jennifer Karas. Warren E. Connelly, Akin, Gump, Hauer & Feld, L.L.P., Washington, DC, argued for plaintiffs-appellants, samsung Electronics Co., Ltd. and Samsung Electronics America, Inc. With him on the brief, was P. Bryan Christy, IIT. Michael P. House, Donovan, Leisure, Rogovin & Schiller, Washington, DC, argued for plaintiffs-appellants, Goldstar Co., Ltd. and Goldstar Electronics International, App. 5 Inc. With him on the brief were R. Will Planert and John K. Brautigam. Paul D. Cullen, Shannon, Rill & Scott, Washington, DC, argued, for plaintiffs-appellants, International Union of Electronic, Elec., Technical, Salaried and Machine Workers, AFL-CIO, Intern. Brotherhood of Elec. Workers of America, Independent Radionic Workers of America and Indus. Union Dept., AFL-CIO With him on the brief, were Jeffrey S. Beckington, David C. Smith, Jr. and Stephen A. Jones. John D. McInerney, Deputy Chief Counsel for Import Admin., argued, for defendant-appellant, the U.S. With him on the brief, was Robert E. Nielsen, Sr. Atty., Office of the Chief Counsel for Import Admin Also on the brief, were Stuart M. Gerson, Asst. Atty. Gen., David M. ( ohen, Director and Velta A. Melnbrencis, Asst. Director, Com- mercial Litigation Branch, Dept. of Justice, Washington, DC Frederick L. Ikenson, Frederick L. Ikenson, P.€ Washington, DC, argued, for plaintiff-appellee, Zenith Electronics Corp. With him on the brief, was J. Erick Nissley. Noel Hemmendinger and William J. Clinton, Wilkie Farr & Gallagher, Washington, DC, were on the brief, for Amicus Curiae, American Ass’n of Exporters and Impor- ters. Bruce Mark Mitchell and David L. Simon, Grunfeld, Desiderio, Lebowitz & Silverman, Washington, DC, were on the brief, for amicus curiae, Emerson Radio Corp. App. 6 Betore NIES, Chief Judge, RICH, Circuit Judge, and SKELTON, Senior Circuit Judge. NIES, Che? Pudge [hese appeals challenge the antidumping duties Imposed o1 r television receivers from Korea im- ctober 19, 1983 and April 30, 1984. The te ‘he Court of International Trade to be | electronics Co. v. United States, 712 r.Supy t Intl Trade 1989) (“Daewoo I”); Daewoo ted States, 760 F.Supp. 200 (Ct. Int’ [rade 199] Jaewoo Il”); and Daewoo Electronics Co. v, United States, 794 F.Supp. 389 (Ct. Int’l Trade 1992) (“Daewoo III"). We affirm in part, reverse in part, vacate the judgment and remand for entry of a judgment in accordance with this decision. I. Background Appellants Daewoo Electronics Co. Ltd., Samsung Electronics Co., Ltd., and Goldstar Co., Ltd. (collectively “the Korean companies”), are leading importers of color television receivers into the United States from Korea. Petitions by the International Union of Electronic, Electri- cal, Technical, Salaried, and Machine Workers, AFL-CIO, the International Brotherhood of Electrical Workers of America, and the Independent Radionic Workers of America and Industrial Union Department, AFL-CIO (collectively “the Unions”) and by Zenith Electronics Corp., resulted in an antidumping investigation into the Korean television receivers imported between October 19, 1983 and April 30, 1984. On December 28, 1984, the App. 7 International Trade Administration of the Department of Commerce (“ITA”) published the final determinations of its first administrative review, concluding that dumping margins of 14.88 percent, 12.23 percent and 7.47 percent existed on U.S. sales of Daewoo, Samsung, and Goldstar products respectively.! Color Television Receivers from Korea; Final Results of Administrative Review of Anti- dumping Duty Order, 49 Fed.Reg. 50420, 50431 (1984). As a result of rulings of the Court of International Trade in the successive appeals and remands, the dumping duties were revised upward to 48.18 percent, 30.36 percent, and 33.95 percent for Daewoo, Samsung, and Goldstar, respectively which the trial court approved. The Korean companies, the Unions, and the United States have each appealed from the judgment of the Court of International Trade raising numerous issues. We address the propriety of the following holdings in the | Where, as here, goods identical to the imported goods are sold in the home market of the exporting country, a margin of dumping is determined by comparing the foreign market value (“FMV”) to the United States price (“USP”). The absolute dump- ing margin for a sale is the amount, if any, by which FMV exceeds USP Determinations of USP and FMV often entail involved cal- culations. USP is based upon the import’s “purchase price,” as defined by 19 U.S.C. § 1677a(b), or if the first sale to an unre- lated American purchaser occurred in the United States, upon the “exporter’s sales price,” as provided in 19 U.S.C. § 1677a(c). FMV is based upon home market sales, third country sales, or constructed value. 19 U.S.C. § 1677b. Once these base figures are determined, Commerce further modifies them to account for shipping costs, differences in commercial quantities sold, or other factors pursuant to statutory provisions and its own regu- lations. See, e.g., 19 U.S.C. §§ 1677a(d), 1677b(a)(1)(A). App. 8 Daewoo opinions: that 19 U.S.C. § 1677a(d)(1)(C) of the antidumping law requires that ITA make an econometric analysis of tax incidence in foreign markets (Daewoo 1); that the ex factory price must be used for tax adjustments of the U.S. price (Daewoo II); and that under 19 U.S.C. § 1673f(a) a bond deposit may not cap the amount of liability for antidumping duties (Daewoo III). The identi- cal issue of the multiplier effect of 19 U.S.C. § 1677a(d)(1)(C) raised in the Korean companies’ appeal was rejected in the recently decided appeal. Zenith Ele tronics Corp. v. United States, 988 F.2d 1573, 1581, (Fed.Cir. 1993), which is controlling here. In addition, our disposi- tion of the tax incidence issue moots two other issues: first, the Korean Companies’ appeal from the holding of Daewoo II, 760 F.Supp. at 204-07, rejecting the ITA’s finding of full tax pass-through in the Korean receiver market; and second, the Unions’ challenge of the ITA’s use of best information available pursuant to 19 U.S.C § 1677e(c) to adjust the USP. Daewoo III, 794 F.Supp. at 391-92. IT. Adjustment for Taxes Levied on Home Country Sales Only The antidumping statute, 19 U.S.C. § 1677a(d)(1)(C) (1988), recognizes that many countries assess excise or commodity taxes upon goods sold for domestic consump- tion, but forgive such taxes on export sales. To prevent the creation of dumping margins merely because the country of exportation taxes home market sales but not App. 9 exports,? the antidumping law provides an offsetting adjustment to the sales price of the goods in the United States (the “U.S. price” or “USP”). Section § 1677a(d) (1)(C) mandates that: The purchase price and the exporter’s sales price shall be adjusted by being . . . increased by ... the amount of the taxes imposed in the country of exportation directly upon the exported merchandise or components thereof, which have been rebated, or which have not been collected, by reason of the exportation of the merchandise to the United States, but only to the extent that such taxes are added to or included in the price of such or similar mer- chandise when sold in the country of exporta- tion. In its original determination, the ITA interpreted sec- tion 1677a(d)(1)(C) as allowing the addition to the U.S. price of the full amount of the Korean taxes on television sets forgiven upon export. In this case the Korean taxing authority imposed a special excise tax, a defense tax and a value added tax that resulted in an aggregate commod- ity tax of 50.04 percent of the price of the television receivers. None of these taxes were assessed against the receivers exported to the United States. It is undisputed that the taxes had been added to Korean home market prices and had actually been paid by the Korean com- panies. The ITA concluded that these facts met the 2 As an example, assume that goods are sold for $100 in both the home market and the United States. While a tax of $50 is imposed in the home market, none is levied in the United States. If tax is not accounted for, a comparison of USP and FMV produces a dumping margin of $50. App. 10 requirements of section 1677a(d)(1)(C) for adding the full amount of the forgiven commodity taxes to the USP. In ITA’s view, the statute permits what it terms an “account- ing” method of determining that taxes were added to or included in the price of merchandise sold in the home country. In the first appeal of this determination, Daewoo I, 712 F.Supp. at 931, the trial court rejected the ITA’s allowance of the full amount of these Korean taxes.3 The trial court held that the final clause of section 1677a(d)(1)(C), allow- ing augmentation of USP “only to the extent that such taxes are added to or included in the price of such or similar merchandise when sold in the country of exporta- tion,” compelled the ITA to analyze the consumer tax incidence of the commodity taxes. Thus, instead of employing an accounting approach that allows USP to be increased by the full amount of a tax levied and paid on home market sales, the court reasoned that the ITA must undertake an econometric study of the Korean market to determine the tax incidence, or “pass through,” of the * The standard of review is set forth in 19 ,9.€. § 1516a(b)(1)(B), which provides: The court shall hold unlawful any determination, finding, or conclusion found - (B) in an action brought under paragraph (2) of subsection (a) of this section, to be unsupported by substantial evidence on the record, or otherwise not in accordance with law. 28 U.S.C. § 2640(b) requires the Court of International Trade to apply this “substantial evidence” standard. See Matsushita Elec. Indus. Co. v. United States, 750 F.2d 927, 932 n. 10 (Fed.Cir. 1984). App. 11 commodity taxes upon consumers.* According to the court, only that amount of the commodity tax that con- sumers actually bore in an economic sense should be added to USP. In so doing, the court relied on its earlier decision in Zenith Electronics Corp. v. United States, 633 F.Supp. 1382 (Ct. Int’l Trade 1986), appeal dismissed as 4 A leading introductory economics textbook describes a tax incidence analysis as asking the question: Who ultimately pays a particular tax? Does the bur- den stay on the person on whom it is first levied? One cannot assume that the people [a government] says a tax is levied on will end up paying that tax. They may be able to shift the tax: shift it “forward” on their customers by raising their price as much as the tax; or shift it “backward” on their suppliers (wage earners, rent and interest receivers) who end up being able to charge them less than they would have done had there been no tax. Economists therefore say: We must study the final incidence of the tax — the way its burden ulti- mately is borne, the totality of its effects on commod- ity prices, factor-prices, resource allocation, efforts, and composition of production and consumption. Tax incidence is no easy problem and requires all the advanced tools of economics to help toward its solu- tion. Paul A. Samuelson, Economics 164-65 (11th ed. 1980). A simple example may illuminate this argument. Suppose a government imposes a sales tax of $50 upon previously untaxed merchandise sold for $100. Assuming away all other market intricacies, if the ultimate cost to the consumers becomes $150 following the tax, the tax incidence is 100%. The seller has passed through the entire amount of the tax to the purchaser. If, however, the price of the merchandise rises to only $125 after the tax is imposed, the tax incidence is 50%. Here, the seller has passed through half the tax to the consumer, either absorb- ing or shifting backward the remaining $25. App. 12 moot, 875 F.2d 291 (Fed.Cir.1989). Unimpressed by the ITA’s reasoning that its accounting methodology was a long-standing agency practice, that an econometric anal- ysis would place an impractical and extremely onerous burden on the agency and importers in almost every investigation, and that such an approach is imprecise and would artificially inflate dumping margins,> the court remanded to the ITA holding that its methodology was not in accordance with the law. On remand, the ITA commissioned Dr. Paul Wachtel, an economist affiliated with New York University, to undertake the mandated tax incidence analysis. Wachtel developed a complex oligopolistic® model of the Korean receiver market based upon the behavior of a single, representative firm. Although this approach did not dis- tinguish individual firm traits, Wachtel determined that such a model would not suffer losses in accuracy due to > To the extent tax incidence is less than 100%, an economic or econometric analysis leads to a smaller upwards adjustment of USP than the accounting approach and therefore to greater dumping margins. To continue the previous example, support USP is $75. Further assume that a home market tax of $50, imposed on merchandise previously costing $100, resulted in a FMV of $125. If tax incidence is assumed to be 100%, USP is adjusted from $75 to $125, and no dumping margin exists. If tax incidence is instead considered to be 50%, then USP is adjusted upwards by only half the amount of the tax, from $75 to $100. Comparing a USP of $100 to a FMV of $125 results in a dumping margin of $25. ® An oligopoly is a “market condition in which sellers are so few that the actions of any one of them will materially affect price and hence have a measurable impact upon competitors.” American Heritage Dictionary 866 (2d college ed. 1991). Here, the Korean receiver market was determined to be an oligopoly. App. 13 certain characteristics of the Korean receiver market. Based upon his analysis, Wachtel concluded that tax inci- dence in the Korean receiver market was 100 percent; i.e., that the consumer bore the entire amount of the Korean excise, defense and value-added taxes. In a second appeal, Daewoo II, 760 F.Supp. at 200, the trial court rejected Dr. Wachtel’s analysis, finding that the study did not adequately analyze Korean market data and that the aggregate approach did not reflect the reality of the marketplace. The court again remanded the case to the ITA. In this second remand, the ITA considered com- pany-specific tax incidence measurements completed by Dr. Robert E. Litan of the Brookings Institute for the Korean companies and Dr. Michael D. Bradley of the George Washington University for Zenith. After rejecting the Litan study, the ITA adjusted USP based upon the Bradley study, which it characterized as the “best infor- mation available” pursuant to 19 U.S.C. § 1677e(c) (1988).” The agency ultimately found tax incidence vary- ing from 33-63 percent, leading to dumping margins of 30.36 percent for Samsung, 33.95 percent for Goldstar, 7 Section 1677e(c) provides: Determinations to be made on best information avail- able. In making their determinations under this title, the administering authority and the Commission shall, whenever a party or any other person refuses or is unable to produce information requested in a timely manner and in the form required, or otherwise significantly impedes an investigation, use the best information otherwise available. See generally Atlantic Sugar, Ltd. v. United States, 744 F.2d 1556, 1559-62 (Fed.Cir. 1984). App. 14 and 48.18 percent for Daewoo. The trial court approved the ITA’s analysis in Daewoo III, 794 F.Supp. at 389. In this appeal, the United States and the Korean companies ask us to reverse the holding in Daewoo I and, in effect, the prior decision of the Court of International Trade in Zenith Electronics. They contend that the trial court erred in interpreting the statute to require the ITA to undertake an econometric measurement of tax inci- dence on home market consumers when adjusting USP to offset the forgiveness of consumption taxes upon exported merchandise.® In Zenith Electronics, 633 F.Supp. at 1398, the Court of International Trade had reached the “inescapable conclusion . . . that Congress intended the administering agency to perform tax absorption measure- ments for application in individual cases.” While the ITA ultimately appealed the ruling, this court dismissed the appeal in Zenith because of the absence of a case or controversy. 875 F.2d at 293. The instant case now requires resolution of the issue of whether section 1677a(d)(1)(C) compels the ITA to undertake a tax inci- dence analysis. This question is one of statutory interpretation, which we must resolve with deference to the agency’s interpretation rather than to the court’s. Suramerica de Aleaciones Laminadas, C.A. v. United States, 966 F.2d 660, 663 (Fed.Cir.1992). When considering the agency’s con- struction of 19 U.S.C. § 1677a(d)(1)(C), we decide only whether “[the ITA’s] interpretation of its statutory power * Amicus Curiae, American Association of Exporters and Importers, also submitted briefing on this issue, urging reversal of the Court of International Trade. App. 15 falls within the range of permissible construction.” Id. at 667. The Supreme Court has instructed that a court may not substitute its own construction of a statutory provision for a reasonable inter- pretation made by the administrator of an agency. We have long recognized that considerable weight should be accorded to an executive department’s construction of a statutory scheme it is entrusted to administer, and the principle of deference to administrative interpretations has been consistently followed by this Court when- ever decision as to the meaning or reach of a statute has involved reconciling conflicting poli- cies, and a full understanding of the force of the statutory policy in the given situation has depended upon more than ordinary knowledge respecting the matters subjected to agency regu- lation. Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 844, 104 S.Ct. 2778, 2782, 81 L.Ed.2d 694 (1984). The Court has further indicated that [w]hen faced with a problem of statutory con- struction, this Court shows great deference to the interpretation given the statute by the offi- cers or agency charged with its administration. To sustain [an agency’s] application of [a] statu- tory term, we need not find that its construction is the only reasonable one, or even that it is the result we would have reached had the question arisen in the first instance in judicial proceed- ings. Zenith Radio Corp. v. United States, 437 U.S. 443, 450, 98 S.Ct. 2441, 2445, 57 L.Ed.2d 337 (1978) (citations omitted). App. 16 These tenets extend to their limits when the ITA interprets the antidumping laws. As noted in Smith- Corona Group, Consumer Products Div., SCM Corp. v. United States, 713 F.2d 1568, 1571 (Fed.Cir.1983), cert. denied, 465 U.S. 1022, 104 S.Ct. 1274, 79 L.Ed.2d 679 (1984) (citations omitted): The Tariff Act of 1930, as amended by the Trade Agreements Act of 1979, establishes an intricate framework, for the imposition of antidumping duties in appropriate circumstances. The number of factors involved, complicated by the difficulty in quantification of those factors and the foreign policy repercussions of a dumping determination, makes the enforcement of the antidumping law a difficult and extremely deli- cate endeavor. [The ITA] has been entrusted with responsibility for implementing the anti- dumping law. [The ITA] has broad discretion in executing the law. This court has recognized the ITA as the “master” of antidumping law, Consumer Prods. Div., SCM Corp. v. Sil- ver Reed Am., Inc., 753 F.2d 1033, 1039 (Fed.Cir.1985), worthy of considerable deference. See also Suramerica, 966 F.2d at 667. The statutory language of 19 U.S.C. § 1677a(d)(1)(C) allows tax adjustment of USP “only to the extent that such taxes are added to or included in the price of such or similar merchandise when sold in the country of exporta- tion.” The ITA and its predecessor have consistently interpreted this language since its enactment in 1974 as a requirement to examine customary business records of exporters. If an exporter’s records show that a tax was either a separate “add on” to the domestic price or, App. 17 although not separately stated, was, in fact, included in the price and that the taxes were paid to the government, that satisfies the tax inquiry required by the statute for an adjustment of the USP. We conclude that this interpreta- tion of the statute is reasonable. The statute does not speak to tax incidence, shifting burdens, or pass-through, nor does it contain any hint that an econometric analysis must be performed. The statutory language does not mandate that ITA look at the effect of the tax on con- sumers rather than on the Korean company. The reality is that, as an unavoidable incident of any sale by the com- pany, these taxes can only be recouped in their entirety from purchasers. Both Zenith and the Unions argue that such a reading of 19 U.S.C. § 1677a(d)(1)(C) renders its final phrase superfluous, but we disagree. As indicated, the language specifies adjustment whether or not the tax is separately stated in the home market price. Further, taxes of the type forgiven upon export may not actually be charged upon all home market sales. Exemption may be allowed under various taxation regimes. For example, the statutes describing the Korean defense tax, special excise tax, and value-added tax each include exemption provisions for certain transactions, such as international navigation ser- vices or sales to the military. Defense Tax Act, No. 2768, art. 3 (1975); Special Excise Tax Act, No. 2935, art. 2 (1976); Value-Added Tax Act, No. 2934, art. 11 (1976). See also, e.g., Final Results of Antidumping Duty Administrative Review, Oil Country Tubular Goods from Canada, 56 Fed. Reg. 38408, 38414 (1991) (noting that only certain home market sales incur “provincial tax”). The phrase is not rendered superfluous by ITA’s interpretation. SS ee App. 18 In Zenith Electronics, the Court of International Trade found support for econometric studies in the history of the Trade Act of 1974, Pub.L. No. 93-618, 88 Stat.1978, 2045, the legislation that added the disputed language of section 1677a(d)(1)(C) to the statute.? The court quoted the following passage from H.R.Rep. No. 571, 93d Cong., Ist Sess. 69 (1973) (emphasis added): With the amendment, no adjustment to the advantage of the foreign exporter would be per- mitted for indirect tax rebates unless the direct relationship of the tax to the product being exported, or components thereof, could be demonstrated. Further, an adjustment for such tax rebates would be permitted only to the extent that such taxes are added to or included in the price of such or similar merchandise when sold in the country of exportation. This is to insure that the rebate of such taxes confers no special benefit upon the exporter of the merchandise that he does not enjoy in sales in his home market. To the extent that the exporter absorbs indirect taxes in his home market sales, no adjustments to purchase \ price will be made and the likelihood or size of dumping margins will be increased. 633 F.Supp. at 1396. The court also set forth a portion of Ambassador William D. Eberle’s statement to the Senate Finance Committee, Hearings Before the Senate Committee on Finance on H.R. 10710, 93d Cong., 2d Sess. 310 (1974): The definition of both “purchase price” and “exporter’s purchase price” are amended to har- monize the treatment of foreign tax rebates ” No party argues that a mandate for tax incidence analyses comes from any other source. App. 19 under the Antidumping Act with the standard of their treatment under the countervailing duty law. No adjustment for tax rebates to the advan- tage of the foreign exporter will be permitted unless the direct relationship between the tax and the exported product or its components can be demonstrated. For example, if the exported product benefited from a tax rebate on the mort- gage on the plant that produced it, the rebate could not be used in the computations to reduce the dumping margin. Moreover, an adjustment for a tax rebate will be permitted only to the extent such taxes are added to or included in the price of the merchandise when sold in the home market. To the extent the exporter absorbs indirect taxes in sales in the home market, no adjustment will be made to purchase price. The effect will be to increase the size of dumping margins under such circumstances. 633 F.Supp. at 1396-97. In the view of the trial court, these “és references constituted a “straight-forward explanation of the operation and purpose of the [disputed] clause” by Congress.'° Id. at 1395. We initially note that the thrust of these remarks expresses concern over identification of a particular tax with the specific product. Congress wished to limit any tax rebate to taxes with a direct relationship to the exported product. It is not at all clear what is meant by the later reference to “absorbs indirect taxes.” But even if both of the quoted passages were intended to refer to tax incidence of directly related taxes, we cannot accept that 10 The court also cited other references that merely recited the words of the statute. See 633 F.Supp. at 1395-97. App. 20 these two passing references alone are sufficient to effect a revolutionary alteration of the ITA’s and its prede- cessors’ consistent use of an accounting approach. As the Supreme Court noted in Allen v. State Bd. of Elections, 393 U.S. 544, 568-69, 89 S.Ct. 817, 833, 22 L.Ed.2d 1 (1969), “in any case where the legislative hearings and debate are so voluminous, no single statement or excerpt of testimony can be conclusive.” On this meager legislative history and with no real debate on what would have been a dramatic change in law, we cannot say that the ITA’s interpretation of the statute contravenes the statute. A consideration of subsequent legislative activity confirms this analysis. In Chaparral Steel Co. v. United States, 901 F.2d 1097, 1106 (Fed.Cir.1990), we stated that “additional deference may be given to an agency inter- pretation when a statutory provision remains unchanged after Congress has considered an amendment, Partic- ularly one that plainly would have reversed established agency practice on this issue.” Although Congress both knew of the ITA’s interpretation of the statute! and revisited the antidumping statute both in 1984 and 1988, !2 it took no action to modify the practice of the ITA. '! See Options to Improve the Trade Remedy Laws: Hearings Before the House Subcommittee on Trade, Committee on Ways and Means, 98th Cong., Ist Sess. 619, 624 (1983) (statement of Ter- rence P. Stewart informing Congress that Commerce does not require proof of tax “pass through” when adjusting USP for domestic taxes). '2 Omnibus Trade and Competitiveness Act, Pub.L. No. 100-418, 102 Stat. 1107 (1988); Trade and Tariff Act of 1984, Pub.L. No. 98-573, 98 Stat. 2948. App. 21 In reaching this result, we are also cognizant of the onerous burden entailed by the Court of International Trade’s mandate. In contrast to the commercial facts available in sales receipts, tax returns and other account- ing records, an econometric analysis of tax pass-through requires numerous subsidiary market inquiries, entails a high degree of speculation based on one economic theory rather than another, and produces results of dubious soundness. As the Supreme Court noted in Zenith Radio, 437 U.S..at 458-59, 98 S.Ct. at 2449 (citation omitted), a countervailing duty case: Even “modern” economists do not agree on the ultimate economic effect of remitting indirect taxes, and — given the present state of economic knowledge — it may be difficult, if not impossi- ble, to measure the precise effect in any particu- lar case. .. . In this situation, it is not the task of the judiciary to substitute its views as to fairness and economic effect for those of [the ITA]. Similarly, when this court considered the ITA regula- tions that modified foreign market value based upon cost differences in circumstances of sales, rather than on “value”, we recognized that “[t]he ready availability of cost data that can be employed without extensive com- plex econometric analysis supports the reasonableness of [the ITA’s] decision to rely on cost. Cost may be the only practical way to administer the statute.” Smith-Coroma, 713 F.2d at 1577 n. 27. An economic analysis of tax inci- dence may reasonably be rejected for the same reason. The delay and expense in making such an analysis in virtually every investigation would restrict the number of investigations which could be handled and interfere with App. 22 ITA’s statutorily mandated duty to “complete the [anti- dumping] determination within rigid time limits.” Id. at 1577. Nor would this approach enable exporters to the United States to operate within the confines of the anti- dumping laws; antidumping duty assessments could issue based upon econometric measurements the exporter could not possibly predict. Further, we cannot conclude that the burden is worth undertaking because of more soundly based results. The results of econometric analysis of tax pass-through in this case resulted in three widely disparate opinions. We thus cannot agree with the trial court that the ITA’s interpretation of section 1677a(d)(1)(C) was con- trary to the statute. We reverse this holding of Daewoo I, 712 F.Supp. at 954-56. IT]. Tax Basis [he Korean companies additionally allege error by the Court of International Trade in reversing the ITA’s use of the net delivered selling price to the first unrelated customer as the imputed commodity tax base under 19 U.S.C. § 1677a(d)(1)(C) for calculating the amount of tax adjustment. That provision mandates a calculation of imputed tax amounts to be added to the USP, but does not specify to which USP the Korean taxes are to be applied as the product moves to the consumer. This determination is important because the Korean taxes are not a specific amount, but instead ad valorem in nature; and it is difficult because the question is a hypothetical. The Korean taxes must be applied to sales of goods at App. 23 some discrete moment in the stream of commerce with or in the United States, a different market from that in which the taxes should be levied, but are not, because of exportation.!* By analyzing Korean tax law and practice, the ITA sought to make an informed judgment on how the Korean authorities would theoretically tax the exported televi- sion receivers so as to select the most comparable price in the U.S. market. Upon the first remand, the ITA deter- mined that in Korea, the taxes were assessed against the net price of the delivered television receivers to unrelated dealers. The Korean price paid by the dealer included post-factory costs, such as delivery and warehousing and the tax was assessed on the price including these post- factory costs. The ITA reasoned that the Korean dealers had the distinguishing trait of being the first parties in the Korean stream of commerce unrelated to the manufac- turer. Accordingly, in selecting the U.S. prices, the ITA ‘5 An example may demonstrate the significance of this determination. Assume that certain guods sell for $200 in both the United States and in the seller’s home market, and that the foreign market tax rate is 50%. In the United States, the goods are sold from the factory to a related distributor for $100. The distributor then sells the goods to consumers for $200. In the foreign market, the goods are sold directly to consumers for $200, plus a tax of $100, for a total of $300. If the tax base is considered to be the sales price to the first unrelated customer, then FMV, including taxes, equals $300. Commerce would also modify the base USP of $200 upwards by 50%, to equal $300. No dumping margin exists. If, however, the tax base is considered to be the factory sales price, Commerce would only modify a base USP of $100 to $150. As the FMV remains $300, a dumping margin of $150 results. App. 24 passed over the intracompany transfer price to affiliates of the Korean manufacturer which brought the receivers to the U.S., i.e., an ex factory price. Instead the ITA selected as most comparable the sales price to customers who were the first unrelated purchasers in the chain. The USP from the importer to U.S. dealers thus also included transportation, storage and selling expenses On appeal, Daewoo II, 760 F.Supp. at 202-04, the Court of International Trade rejected the ITA’s selected tax base. According to the court, the “plain mandate of Korean law” indicated “that the tax base in the home market is the price at which the goods are carried out of the place of manufacture.” Id. at 203. The court considered the statutory language to compel use of an ex factory price, which does not include any post-factory expenses, as the tax base. In the view of the trial court, the ITA acted without the support of substantial evidence in the record that the sales price to the first unrelated purchaser in the United States would likely be the tax base chosen by Korean authorities. The court did note, however, that “in the Korean market the taxable events were sales to unre- lated dealers, but that just happened to be the type of price at which the ex factory transaction occurred.” Id. at 204. On review of this issue, like the trial court, we look to see whether substantial evidence supports the decision of the ITA on this issue. Substantial evidence consists of “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Matsushita, 750 F.2d at 932 (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 217, 83 L.Ed. 126 (1938)). App. 25 The specific determination we make is “whether the evi- dence and reasonable inferences from the record support the [ITA] finding.” Matsushita, 750 F.2d at 933. The ques- tion is whether the record adequately supports the dec- sion of the ITA, not whether some other inference could reasonably have been drawn. As frequently stated, “the possibility of drawing two inconsistent conclusions from the evidence does not prevent an administrative agency's finding from being supported by substantial evidence.” Id. (quoting Consolo v. Federal Maritime Comm’n, 383 U.S. 607, 619-20, 86 S.Ct. 1018, 1026, 16 L.Ed.2d 131 (1966)). It cannot be determined from review of the three Korean tax statutes alone what would be the tax base in Korea. The legislation is broadly worded and does not specify whether, for instance, delivery and insurance costs are included. The Value-Added Tax Act, No. 2934, art. 6 (1976) provides only that a taxable transaction consists of “the delivery and/or transfer of goods.” The “taxable basis” consists of monetary payments for those goods; although such items as damaged goods are excluded from the basis, the statute does not address delivery costs. Id. at art. 13. The Special Excise Tax Act, the statute apparently relied upon by the Court of International Trade, see Daewoo II, 760 F.Supp. at 203, is at first blush more help- ful.!4 It provides that the appropriate tax base for manu- facturers consists of “the price at which the goods are carried out from the factory.” Special Excise Tax Act, No. 14 As the defense tax is a surtax on the special excise tax, it presents no relevant basis provisions and is unhelpful. See Defense Tax Act, No. 2768, art. 4, item 5 (1975). App. 26 2935, art. 8 (1976). Although the translated statutory lan- guage suggests that we would call an ex factory price, i.e., without delivery and other post-factory charges, it could also be that the price contemplated by the statute includes an add-on for the “carrying out from the fac- tory.” In reaching its conclusion of the USP, the ITA relied on actual Korean tax practice, not merely on the statutes. As part of the ITA investigation, the Korean companies submitted numerous accounting records providing infor- mation on receiver sales and taxation. These records spanned tens of thousands of sales over the period under review. It is uncontested that these records demonstrate that in each case, the tax base employed by the Korean authorities consisted of the full delivered sales price to dealers. The tax base actually employed by the Korean authorities therefore included delivery, warehousing and other post-factory costs. In addition, the Korean com- panies point to evidence demonstrating that, when the manufacturer sold receivers to its affiliate rather than directly to an unrelated dealer, Korean tax officials used the dealer price as the tax base and ignored the intra- company transfer price. Given this evidence, we cannot agree with the trial court that the ITA erred in selecting the analogous point for the tax base in the United States. Substantial evidence supports the ITA’s choice, and that is all the statute requires. The Court of International Trade’s rejection of the USP selected by the ITA for lack of substantial evi- dence is reversed. App. 27 IV. Cap on Duties The Korean companies also appeal the Court of Inter- national Trade’s holding in Daewoo III, 794 F.Supp. at 393, that no cap on assessment rates exists if estimated duties are deposited in the form of a bond.!5 This ruling con- cerns an ITA regulation, 19 C.F.R. § 353.50, which speci- fically treated cash deposits and bond deposits the same for capping purposes.!6 Under the antidumping laws, estimated duties may be assessed and must be paid or guaranteed before the amount is finally resolved. If a preliminary determination '° Amici curiae Emerson Radio Corporation and the Ameri- can Association of Exporters and Importers filed briefs on this issue. 16 45 Fed. Reg. 8182, 8204 (1980) (codified at 19 C.ER. § 353.50) provided that: If the amount of the estimated antidumping duty deposited pursuant to the Preliminary Affirmative Determination is different from the .. . Antidumping Duty Order, the difference . . . shall be: (a) Disregarded, to the extent that the estimated duty is less than the duty determined to be assessable under the Order, or (b) Refunded, to the extent that estimated duties collected were more than the duty determined to be assessable under the Order. Commerce later clarified the provisional rate cap regulation: If the cash deposit or bond . . . is different from the dumping margin . . . , the Secretary will instruct the Customs Service to disregard the difference to the extent that the cash deposit or bond is less than the dumping margin... . 54 Fed. Reg. 12742, 12779 (1989) (codified at 19 C.F.R. § 353.23). App. 28 indicates that dumping has occurred, 19 U.S.C. § 1673b(d) requires the ITA to “order the posting of a cash deposit, bond, or other security, as it deems appropriate, for each entry of the merchandise concerned equal to the esti- mated average amount by which the [FMV] exceeds the [USP].” If a preliminary determination matures into a final affirmative determination of dumping and issuance of a dumping order which exceeds the cash or bond deposit, the ITA by regulation limited an importer’s antidumping duty liability to the amount of the previously deposited, estimated duties whether the ‘deposit was in the form of cash or bond. In issuing this regulation, the ITA relied on the statute respecting the cap although the statute does not specifically deal with capping by a bond deposit. The pertinent statute, 19 U.S.C. § 1673f(a) (1988), provides: If the amount of a cash deposit collected as security for an estimated antidumping duty .. . is different... from the antidumping order, . . . then the difference shall be - (1) disregarded, to the extent the cash deposit col- lected is lower than the duty under the order, or (2) refunded, to the extent the cash deposit is higher than the duty under the order. The Korean companies here covered their estimated duty obligations with bonds in accordance with the statute and regulations. In determining that bond deposits did not suffice to cap antidumping duty liability, the Daewoo III court relied upon a ruling in Zenith Electronics v. United States, 770 F.Supp. 648 (Ct. Int’l Trade 1991) (“Zenith II”). There, the iii cea na emraneay App. 29 court rejected the ITA’s interpretation that a bond deposit had the same effect as a cash deposit. The ITA had argued that section 1673f(a), in referring only to cash deposits, contrasted with other related sections which refer also to bonds and other forms of security, see 19 U.S.C. §§ 1673b(d)(2), 1673d(c)(2)(B), 1673e(c)(1), and believed that the difference was an inadvertence which would have awkward results. However, the court disagreed, noting that section 1673f(a) appeared to single out cash deposits, and that a cap on assessment rates for deposits in the form of bonds or other security was contrary to the Statute. Zenith Il, 770 F.Supp. at 651-54. Applying this rule, the Daewoo III court, held that the Korean companies were liable for the amount of the dumping margin deter- mined in the final antidumping order - an amount signif- icantly greater than the estimated duties for which they posted a bond. 794 F.Supp. at 393.17 In considering the issue, we continue to rely upon the case law previously cited in Part II of this opinion respecting deference to the ITA’s interpretation. We have additionally examined the authority of Melamine Chemi- cals, Inc. v. United States, 732 F.2d 24 (Fed.Cir.1984), where this court also considered an antidumping regulation pro- mulgated by the ITA. We there observed: When the issue is the validity of a regulation issued under a statute that an agency is charged '7 After the Court of International Trade issued its opinion in Zenith Il, Commerce indicated that it would follow that hold- ing, but prospectively only. 57 Fed. Reg. 45769 (1992). The court here rejected that limitation. In view of our resolution of this issue, the changed regulation may have prospective application only. App. 30 with administering, it is well established that the agency’s construction is entitled to great weight. Similarly, agency regulations are to be sustained unless unreasonable and plainly inconsistent with the statute, and are to be held valid unless weighty reasons require otherwise. Id. at 928 (citations omitted). We are also mindful of the ITA’s past practice in this area. The Trade Agreements Act of 1979, Pub.L. No. 96-39, § 107, 93 Stat. 144, 193, pro- vided that its provisions, including 19 U.S.C. § 1673f(a), would take effect on January 1, 1980. The ITA issued 19 C.F.R. § 353.50 the next month, on February 6, 1980, interpreting the statute to allow the cap for bond and cash deposits. 45 Fed. Reg. 8182, 8204. In this regard, the Supreme Court has instructed that “an administrative practice has particular weight when it involves a contem- poraneous construction of a statute by the [persons] charged with the responsibility of setting its machinery in motion, of making the parts work efficiently and smoothly while they are yet untried and new.” Zenith Radio Corp. v. United States, 437 U.S. 443, 450, 98 S.Ct. 2441, 2445, 57 L.Ed.2d 337 (1978) (citations omitted). We further note that the ITA has consistently placed a ceiling upon antidumping duties irrespective of whether a bond or cash deposit is posted as security. With these standards guiding us, we again must hold that the Court of International Trade erred by substitut- ing its interpretation for that of the ITA. Section 1673f(a) does not prohibit the application of the cap to bonds. This provision simply does not speak to whether estimated duty bonds cap antidumping duties. Given this silence, as well as the statute’s authorization to file bonds to cover App. 31 estimated duties, we cannot say that the ITA’s allowance of a duty ceiling for bonds is contrary to the statute. We also are unpersuaded of any other “weighty reasons” to hold that the ITA’s longstanding practice rests on an unreasonable interpretation of the statute.'* An examination of the antidumping statute’s legisla- tive history buttresses our conclusion. The House Com- mittee Report to the 1979 Trade Agreements Act includes the following passage: [T]he Committee understands that it is the intent of the Authority to require cash deposits only in those cases where it believes that bonds or other forms of security will not adequately protect the revenue. Because injurious dumping has not been finally determined at this point in the investigation and a requirement of a cash deposit, if unnecessary, might represent a bur- den to the importer, the Committee has agreed with this practice. H.R.Rep. No. 31, 96th Cong., Ist Sess. 62 (1979). Further, this court has recognized that “failure to revise or repeal the agency's interpretation is persuasive evidence that the interpretation is the one intended by Congress.” Chap- arral Steel, 901 F.2d at 1106 (quoting NLRB v. Bell Aerospace Co., 416 U.S. 267, 94 S.Ct. 1757, 40 L.Ed.2d 134 (1974)). 16 Considered alone, the failure to specify bonds in § 1673f(a) might indicate a deliberate decision by Congress against a cap based on a bond or security. Cf. Nissan Motor Corp. v. United States, 884 F.2d 1375, 1377 (Fed.Cir.1989) (reciting the familiar maxim that expressio unius est exclusio alterius, the expression of one thing is the exclusion of the alternative). However, such a conclusion is not the only possible inference here in view of the other factors discussed above. App. 32 Although Congress has twice significantly amended the Act, it did not alter section 1673f(a) on either occasion.!% Both of these actions evidence that the policy of the ITA comports with congressional intent. In reaching its conclusion, the Court of International lrade relied principally on a “clear distinction [between treatment of cash and bonds] in the underlying interna- tional agreements” that the U.S. international trade laws were designed to implement. Zenith Electronics, 770 F.Supp. at 653. The court concluded that while the GATT Subsidies Code provided for a cap whether the security took the form of cash or bond, the GATT Antidumping Code distinguished a security from cash and only a cash deposit capped the duties. We do not find such differ- ences between the GATT Antidumping and Subsidies Codes. The court quoted from a House of Representatives reprint of the GATT Antidumping Code?° which stated that provisional measures “may take the form of a provi- sional duty or, preferably, a security — by deposit or bond - equal to the amount of the anti-dumping duty provi- sionally estimated.” Id. (emphasis added). From this lan- guage, the court then reasoned, “jt]his establishes a distinction in the Antidumping Code between ‘provisio- nal duty,” which would be the equivalent of cash deposits under the law, and the posting of securities.” Id. 19 See supra note 12. 20 Agreements Reached in the Tokyo Round of Multilateral Trade Negotiations, H.R.Doc. No. 153, 96th Cong., Ist Sess., pt. 1, at 312, 323 (1979). App. 33 Our examination of the GATT Antidumping Code reveals that the distinction drawn by the Court of Inter- national Trade was based on an incorrect print.?! The correct version of the GATT Antidumping Code reads: “[p]rovisional measures may take the form of a provisio- nal duty, or, preferably, a security — by cash deposit or bond — equal to the amount of the antidumping duty provisionally estimated.”?2 The addition of the word “cash” negates the court’s interpretation that a security could not be a cash deposit. We conclude that the Court of International Trade erred in invalidating the ITA’s regulation on the ground of conflict with section 1673f(a). The holding of Daewoo III, 794 F.Supp. at 393, that bond deposits do not cap antidumping duties is reversed. V Conclusion For the foregoing reasons, we affirm the decision of the Court of International Trade on the issue of multiplier effect of 19 U.S.C. § 1677a(d)(1)(C), and reverse its rulings on the other issues addressed herein. The case is remanded for proceedings consistent with this opinion. 21 The House Report cited by the court includes this lan- guage in its “Corrigendum” section, which instructs the reader to “[i]nsert ‘cash’ between ‘by’ and ‘deposit’ in the second line” of paragraph 2 of Article 10. H.R.Doc. No. 153, supra, at 333,335. 22 Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade, supra, Part I, art. 10, para. 2, 31 U.S.T. at 4933 (emphasis added). App. 34 VI Costs Each party shall bear its own costs AFFIRMED-IN-PART, REVERSED-IN-PART, AND REMANDED App. 35 DAEWOO ELECTRONICS CO., LTD. et al., Plaintiffs, V. The UNITED STATES, Defendant. Court No. 85-01-00140. United States Court of International Trade. July 14, 1992. Korean television manufacturers appealed antidump- ing order. The Court of International Trade, 712 F.Supp. 931, remanded for reconsideration. The Department of Commerce determined antidumping margins, and manu- facturers appealed. The Court of International Trade, 760 F.Supp. 200, remanded for reconsideration. United States manufacturer moved for final judgment on Department's redetermination of antidumping margins. The Court of International Trade, Watson, Senior Judge, held that: (1) Department properly ordered Korean manufacturers to use econometric methods; (2) Department properly relied on report of United States manufacturer’s expert as best information available; (3) Department used correct tax basis for exported television receivers; and (4) earlier decision with respect to assessment rate cap had to be modified to conform with subsequent decision in another case. Affirmed as modified. Reid & Priest, Washington, D.C. (David A. Gantz, Andrea E. Migdal, Kevin Lara, of counsel) for plaintiffs Daewoo Electronics, Co., Ltd., Daewoo Electronics Corp. of America Inc. and the Daewoo Corp. App. 36 Aiken [sic], Gump, Hauer & Feld, Washington, D.C. (Warren E. Connelly and Edith E. Scott of counsel) for plaintiff-intervenors Samsung Electronics Co., Ltd. and Samsung Electronics America, Inc. Donovan Leisure, Rogovin, Huge & Schiller, Wash- ington, D.C. (Michael P. House & R. Will Planert, of counsel) for plaintiff-intervenors Goldstar Co., Ltd. and Goldstar Electronics Intern., Inc. Collier, Shannon, Rill & Scott, Washington, D.C. (Paul D. Cullen and Jeffrey S. Beckington of counsel) for defen- dant-intervenors the International Union of Electronic, Elec., Technical, Salaried and Machine Workers, AFL-CIO; Internl. Broth. of Elec. Workers; Independent Radionic Workers of America, and Indus. Union Dept., AFL-CIO. Frederick L. Ikenson, P.C., Washington, D.C. (Fred- erick L. Ikenson, J. Eric Nissley and Larry Hampel of counsel) for plaintiff Zenith Electronics Corp. Stuart M. Gerson, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, U.S. Dept. of Jus- tice, Washington, D.C. (Velta A. Melnbrencis, Attorney) and Robert E. Nielsen, Attorney-advisor, Office of Chief Counsel for Import Admin., U.S. Dept. of Commerce, for defendant U.S. OPINION AND ORDER WATSON, Senior Judge: Following a second remand to the Department of Commerce and its redetermination, this action is now before the court on a motion by Zenith Electronics Corpo- ration for final judgment. The motion is supported by the App. 37 government and opposed by three groups of Korean liti- gants, Daewoo, Samsung, and Goldstar. The previous opinions in this case were Daewoo Electronics Co., Ltd. v. United States, 13 C.1.T. 253, 712 F.Supp. 931 (1989) and Daewoo Electronics Co., Ltd. v. United States, C..1.T. __, 760 F.Supp. 200 (1991). The central issue in this motion for final judgment concerns the tax pass-through measurement for which the court set out guidelines in its second remand. The tax pass-through measurement which remains at issue here is done for the purpose of determining to what extent the foreign market price is higher than the price in the United States due to the fact that it includes a tax imposed when the merchandise is sold in the country of exportation, but not imposed when it is exported. In order to eliminate the unfairness which would result from comparing a price which includes the tax to one which does not, and thus finding a dumping margin where one does not exist, the law requires an adjustment for taxes. Obviously, the greater the percentage of the commodity tax which is passed on to the consumer and which shows up in the price, the larger is the effect resulting from its removal from the equation comparing the price in the home market of the foreign producer and the price in the United States market. In the remand opinion, the court disapproved the method by which Commerce found that the entire com- modity tax was passed through to consumers. In brief, Commerce made certain assumptions about the nature of the demand curve for the products in the Korean market which were not tested against actual data. Commerce also App. 38 aggregated the data of all Korean respondents for differ- ent types of television receivers, creating a database which did not accurately reflect the evidence in the record. Accordingly, the court remanded the action to Commerce “to perform the analysis on a disaggregated basis, to consider alternative forms for demand curves, and explain the evidence from the data which justifies it [sic] choice of one form over others.” At the conclusion of its opinion, the court ordered “that with respect to the measurement of tax pass-through, Commerce shall per- form the measurements on a disaggregated basis for each respondent and for the different types of television receivers; and that Commerce shall consider alternative forms of demand curves and specify the evidence in the record which makes it [sic] chosen curve a superior repre- sentation of the facts with respect to demand in the home market.” The Korean litigants argue that the results of this latest remand proceeding are defective because Com- merce did not comply with the full terms of the court’s order. They further argue that Commerce did not specify the methodology which was to be used in measuring the pass-through when it placed a burden on the Korean litigants to use generally accepted econometric methods to calculate the pass-through. The Korean interests also claim that Commerce ultimately erred in using Professor Bradley’s measure of pass-through (which had earlier been submitted by Zenith), as the best information avail- able. As to the first argument, the court is satisfied that Commerce complied with its obligations under the App. 39 remand order by requiring the respondents to use gener- ally accepted econometric methods. The failure of respon- dents to supply the information on which a more precise analysis could have been made, cannot be held against Commerce. The court views econometrics as one of a number of alternative methodologies. Although it would obviously be easier for the respondents if Commerce specified the particular econometric technique which should be used, that is not a requirement of the court, nor would it be reasonable in the formative stages of administrative expe- rience in this area. The claim that Commerce improperly relied on the best information available and unlawfully rejected the information supplied by the Korean respondents requires some background discussion. Commerce began its recon- sideration on remand by requiring the respondents to provide pass-through measurements, utilizing any meth- odology which they wished to employ, and opened up the record for the receipt of new information. Zenith objected to the opening of the record. Thereafter, the government moved the court for an extension of time within which to complete the remand, asking for nine months if the record was to be reopened or four months if it was to remain closed. The court approved the second alternative. In the meantime, Commerce had corrected its first remand instructions by informing the respondents that in order to perform the tax pass-through measure- ment, they had to use generally accepted econometric methods and were not free to use any methodology at all. The three Korean respondents submitted individual pass- through analyses, all of which relied exclusively upon a App. 40 report which had been prepared for them by their jointly retained consultant, Dr. Litan. With respect to the basic question of what demand curve functional form would best fit the underlying data in this case (linear, log-linear, or quadratic), the Litan report gave overwhelming sup- port for the log-linear specification. That conclusion was based on the fact that Dr. Litan calculated certain statis- tics for several types of regressions run against each of the three functional forms in issue. According to Dr. Litan, the log-linear form, which is the one which con- clusively dictates full pass-through in this case, produced the best results for 11 of the 12 models/producer combi- nations. Based on that conclusion, it was unnecessary for Dr. Litan to perform actual pass-through measurements and none were made. Following the submission of the Litan Report, Zenith submitted comments by Professor Bradley which con- clusively showed that Dr. Litan had erred in applying the formula for developing the statistics for the log-linear equation. A correct computation of those statistics actu- ally provided corroboration that tax pass-through was less than 100%. Thereafter, the Korean respondents submitted a cor- rected report from Dr. Litan. That correction was fol- lowed by another response from Professor Bradley. Commerce ultimately rejected the corrected Litan report on the ground that his chosen method wzs not adequately implemented. More specifically, Commerce noted that the Litan report should have employed a maximum likeli- hood test, a test that it considered necessary to implement the procedure finally being used by Dr. Litan to distin- guish between functional forms. App. 41 The rejection of the Litan report, after a relatively generous allowance of an opportunity for its correction, left the record bare of any pass-through measurements other than those of Professor Bradley. At that point Com- merce chose to invoke its authority to use the best infor- mation available to designate Professor Bradley’s measurement as such information without relying directly upon Professor Bradley’s underlying analysis as the one preferred by Commerce. The Korean litigants argue that having rejected Dr. Litan’s work, Commerce should have reiied on the work of its own economists rather than moving to the measure- ments of Professor Bradley. The court is of the opinion that the work done by Commerce’s own economists does not amount to a mea- surement of pass-through, does not cure the defects found in the Litan report on which it is based, and would be insufficient to support a choice between linear and log-linear demand equations. The only conceivable sup- port for using the work of Commerce’s own economists is [able One of Technical Appendix Two to the second remand results. This shows only the outcome of a single manipulation of Dr. Litan’s result and does not represent the outcome of a new set of estimations. The economists themselves indicate that their table does not provide any statistical tests which would allow one to choose between linear and log-linear demand equations. Second R.R. Pub- lic Doc. No. 71, Technical Appendix Two at 14. What remains is the question of the legality of Com- merce’s use of Professor Bradley’s results as the best information available. The court does not find this to be App. 42 an improper use of the authority to rely on best informa- tion available. There can certainly come a point in an administrative proceeding when providing further opportunities for respondents to supply information has to be balanced with the need to reach a final result. The court does not find it necessary to discuss the flaws which Commerce itself professes to find in the Bradley measurement result. Even if the Bradley measurement results are flawed, this would not detract from their use as best information available. The court notes that the use of best information avail- able by the Commerce Department in its final results in this second remand led to a conclusion that from thirty- three percent to sixty-two percent of the Korean commod- ity taxes were passed-through by the Korean respondents and could therefore enter into the calculation of the dumping margin. It should be pointed out that this was not the harshest result which the agency could have reached. It would have been entirely within the power of the Commerce Department, in the absence of satisfactory information concerning the claimed commodity tax adjustment, to deny that claim in its entirety. In point of fact, the Unions argue that in the absence of a proper showing of entitlement by the Korean respondents to the claimed adjustment, no adjustment whatsoever should have been made. The unions argue that Commerce vio- lated a fundamental tenet of administrative law by departing from the standard practice of requiring a dem- onstration of entitlement before granting an adjustment. The court does not find that such a rigorous standard applies in this area of the law. The Commerce Depart- ment has the authority to make adjustments to the extent ee App. 43 warranted by the evidence in the record and they need not be made on an all or nothing basis. Aside from the argument about the pass-through measurements, the Korean litigants argued that Com- merce erred by not including U.S. resale profit in the tax basis of exported receivers. Goldstar also argues that Commerce erred by removing international movement costs from the tax basis of exported receivers. The court finds that Commerce's use of the price for exportation as the tax basis for all exported receivers was correct. This conforms to the court’s previously expressed opinion in this case that there is no evidence in the record to contradict the conclusion based on Korean law that the price for exportation at which the merchandise left the place of manufacture would have been the tax base if a tax was to be imposed on exportations. The price for exportation clearly does not include U.S. resale profit nor does it include the cost of international movement and U.S. importation, which are incurred after exportation. For this reason, the court approves the tax basis used for exported receivers in the second remand. In its motion for final judgment, Zenith also asks this court to reverse its earlier decision in this case, which goes back three years, that a cap existed on the duty assessment rate which ultimately would be applied to “dumped” entries if estimated antidumping duties were deposited in the form of a bond. Zenith is correct in pointing out that a conflict exists between that opinion and the court’s more recent decision in July of 1991 on that same issue. The later decision fully and clearly sets out the court’s current opinion that there is no cap on App. 44 assessment rates if estimated duties are deposited in the form of a bond. In the interest of justice and in the interest of having this opinion accurately reflect the state of the law as it presently exists, the earlier decision in this case must be modified to conform to the decision in Slip Op Y] fala) For the reasons given above, it is hereby ORDERED, \DILDGED and DECREED that the second determina- tion of the Department of Commerce on remand in this action, which is dated September 24, 1991, is upheld, and it is further ORDERED, ADJUDGED and DECREED that no assessment rate cap may be applied in liquidating the subject entries unless the importer paid a cash deposit for an estimated antidumping duty. This is in accordance with the court’s decision and holding on July 29, 1991 (Slip Op. 91-66) in Zenith Electronic Corporation v. United States, Et. Al, Court No. 87-01-00039, 770 F.Supp. 648, and it is further ORDERED, ADJUDGED and DECREED that to the extent that the court’s earlier decision herein on April 1989 (Slip Op. 89-42), 712 F.Supp. 931, on the subject of the assessment rate cap is inconsistent with the court's more recent decision on July 29, 1991 (Slip Op. 91-66) the decision in Slip Op. 89-42 is modified to conform to the decision in Slip Op. 91-66. App 45 DAEWOO ELECTRONICS COMPANY, LTD., et al., Plaintiffs, v. The UNITED STATES, Defendant. Court No. 85-01-00140. United States Court of International Trade March 25, 1991 Korean television manufacturers appealed from Department of Commerce’s antidumping order. The Court of International Trade, 712 F Supp. 931, remanded tor reconsideration. On remand, the Department of Com- merce again determined dumping margins, and appeal was taken. The Court of International Trade, Watson. senior Judge, held that: (1) in determining foreign taxes forgiven for purposes of calculating dumping margins substantial evidence did not support Commerce Depart- ment’s determination that taxes forgiven on exportation of merchandise would have been taxes based on first sale to unrelated purchaser in the United States market; (2) in Department’s econometric model used to determine whether Korean commodity tax was passed through to onsumers in Korea was not supported by substantial evidence; and (3) Department’s errors in calculations in determining dumping margins were required to be cor- rected on remand Remanded Oppenheimer Wolff & Donnelly (David A. Gantz and limothy A. Harr, of counsel), Washington, D.C., for App. 46 plaintiffs Daewoo Electronics Co., Ltd., Daewoo Elec tronics Corp. of America, Inc. and Daewoo Corp. Dow, Lohnes & Albertson (William Silverman, Michael P. House and R. Will Planert, of counsel), Wash- ington, D.C., for plaintiffs Goldstar Co., Ltd. and Gold- star Electronics Intern., Inc Arnold & Porter (Sukhan Kim, Lawrence A. Schnei- der and Susan G. Lee, of counsel), Washington, D.C., for plaintiffs Samsung Electronics Co., Ltd. and Samsung Electronics America, Inc. Frederick L. Ikenson, P.C. (Frederick L. Ikenson, J]. Eric Nissley and Larry Hampel, of counsel), Washington, D.C., for plaintiff Zenith Electronics Corp. Collier, Shannon & Scott (Paul D. Cullen and Jeffrey S. Beckington, of counsel), Washington, D.C., for plain- titts Intern. Union of Electronic, Elec., Technical, Salaried and Mach. Workers, AFL-CIO, Intern. Broth. of Elec Workers, Independent Radionic Workers of America and Industrial Union Dept., AFL-CIO. Stuart M. Gerson, Asst. Atty. Gen., David M. Cohen, Director, Commercial Litigation Branch, Civil Div., U.S. Dept. of Justice, Velta A. Melnbrencis, atty., New York City, Robert E. Nielsen, atty., Office of the Chief Counsel tor Import Admin., U.S. Dept. of Commerce, Washington, D.C., tor defendant. WATSON, Senior Judge [his consolidated action is before the court for review of the results of a redetermination made by the Department of Commerce (“Commerce”) pursuant to this court’s remand in Daewoo Electronics Co., Ltd. v. United a App. 47 eetieeiee et States, 13 CIT , 712 F.Supp. 931 (CIT 1989). It relates to the question of dumping margins which were determined for color television receivers from Korea. rhe court turns first to the question of whether or not Commerce complied with the adjustment for taxes required by § 772(d)(1)(C) of the Tariff Act of 1930, as amended (19 U.S.C. § 1677a(d)(1)(C)). That provision is among those designed to insure that before a comparison is made between the price in the home market of the foreign producer and the price for the U.S. market, the “United States price”, (further categorized as “purchase price” or “exporter’s sales price”) does not come out lower than the home market price of the foreign producer simply because it does not include certain unavoidable amounts which are included in the price of the merchan- dise when it is sold in the foreign country. In particular, the provision involved here is concerned with the «xtent to which the foreign market price may be higher due to the fact that it includes a tax imposed when the merchan- dise is sold in the country of exportation but not imposed when it is exported. To eliminate that possible imbalance or unfairness in the comparison the law provides that the U.S. price should be increased by - the amount of any taxes imposed in the country of exportation directly upon the exported mer- chandise or components thereof, which have been rebated, or which have not been collected, by reason of the exportation of the merchandise to the United States, but only to the extent that such taxes are added to or included in the price of such or similar merchandise when sold in the country of ex portation. App. 48 The Korean taxing authority imposes three taxes on such merchandise when it is not exported. They are, a special excise tax of 28%, a defense tax of 30% of the special excise tax amount, and a value added tax of 10% levied on the sum of the tax base, the special excise tax amount and the defense tax amount. Commerce ultimately determined that the actual Korean tax base was the net dealer delivered price, that is to say, the price to the first unrelated home and market buyer. It therefore concluded that the analogous hypo- thetical tax base in the export market (for the United States) i.e., the amount which would have been taxed but for the exportation and to which the hypothetical tax had to be added in order to make a fair comparison between prices, was the sale to the first unrelated U.S. buyer. Zenith Electronics Corporation (“Zenith”) argues that Commerce erred in determining that the taxes forgiven on exportation of this merchandise would have been taxes based on the first sale to an unrelated purchaser in the U.S. market. Zenith first argues that the Korean tax laws make the tax base the equivalent of the ex-factory price. It points out that for home market sales purposes under the Korean Special Excise Tax Act, television receivers are taxed on “the price at which the goods are carried out from the factory.” [Goldstar January 5, 1990 questionnaire response, Appendix 1-2 at p. VI-288; remand Rec.P-Doc. 37, RK. 1, Fr. 428.] It further asserts that the Defense Tax, insofar as it is a percentage of the Special Excise Tax, is also derived from the price at which the television receivers are carried out of the place of manufacture. App. 49 Finally, Zenith asserts that the value added tax has the same focus as the Special Excise Tax because inter alia, the place of the transaction is “where the moving of the goods starts.” [Id. at page VI-268 (Art. 10, para. 1, item 1); Fr. 445.] Zenith also stresses that in response to Commerce's tax questionnaire in this remand, the Korean respondents all described the Korean home market taxes as percentages either directly or indirectly related to “the ex-factory price.” Zenith characterizes Commerce’s action as the trans- formation of taxes forgiven upon exportation in the for- eign country into taxes forgiven upon resale in another country, taxes which would hypothetically be levied on the amount of import duty paid to the United States government, and taxes which would not be calculated until months after the taxable ev [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386002_1261%3A1. Public record. Not legal advice.