Background
Maquilacero S.A. de C.V., Tecnicas de Fluidos S.A. de C.V., and consolidated plaintiff Perfiles LM, S.A. de C.V. challenged the Commerce Department’s final results in its 2020–2021 administrative review of the antidumping duty order covering light-walled rectangular pipe and tube from Mexico. Commerce originally used the Cohen’s d test in its differential-pricing analysis and assigned dumping margins of 9.2% to Maquilacero and TEFLU and 5.32% to Perfiles.
After the Federal Circuit held in Marmen III that Commerce could not use the Cohen’s d test for data sets like those at issue, the CIT ordered another remand. Commerce replaced that test with a three-step analysis consisting of a new price-difference test, the ratio test, and the meaningful-difference test. The revised analysis produced margins of 10.67% for Maquilacero and TEFLU and 6.06% for non-selected respondents such as Perfiles.
The Court’s Holding
The CIT sustained Commerce’s second remand redetermination. The court held that reasonableness remained the governing standard for reviewing Commerce’s selection of statistical tests and numerical cutoffs. It concluded that Commerce reasonably treated weighted-average prices outside a plus-or-minus 2% band as significantly different because the test measured relative, respondent- and product-specific price differences rather than imposing an absolute price threshold.
The court also upheld Commerce’s use of the ratio and meaningful-difference tests. Because 98.12% of the value of Maquilacero and TEFLU’s U.S. sales passed the price-difference test and the calculated margin crossed the de minimis threshold when Commerce moved from the average-to-average method to the average-to-transaction method, Commerce reasonably concluded that the ordinary method could not account for the pricing differences.
Commerce was not required to determine whether manufacturing-cost changes, rather than targeted dumping, caused the price differences. The court further held that Commerce permissibly abandoned its prior mixed methodology and applied the average-to-transaction method to all sales because the statute does not require a mixed method and the Federal Circuit’s remand permitted Commerce to refashion its analysis without relying on Cohen’s d.
Key Takeaways
- Commerce’s new 2% price-difference test was a reasonable method for identifying significantly different prices under 19 U.S.C. § 1677f-1(d)(1)(B).
- Commerce need not determine why prices differ significantly or establish a respondent’s intent before applying its alternative comparison methodology.
- Commerce lawfully discontinued its mixed methodology and used the average-to-transaction method after its revised analysis showed that the average-to-average method masked above-de-minimis dumping.
Why It Matters
The decision approves Commerce’s post-Marmen III replacement for the invalidated Cohen’s d test and confirms that the agency retains substantial methodological discretion when identifying pricing patterns and selecting numerical thresholds, provided its choices are reasonable and adequately explained.
For antidumping respondents, the ruling also limits challenges based on the commercial reasons behind price variations. The statutory analysis focuses on whether significant pricing patterns exist and whether the standard comparison method accounts for them, not on whether Commerce proves that the exporter intended to target particular customers, regions, or time periods.