RZBC Group Shareholding Co., Ltd. et al v. United States

Slip Op. 16-64
UNITED STATES COURT OF INTERNATIONAL TRADE
OPINION AND ORDER
[Remanding in part the Final Results of a review of a countervailing duty order on citric acid
from the People’s Republic of China.]
Dated: June 30, 2016
Michael S. Holton, Husch Blackwell LLP, of Washington, DC, argued for plaintiffs.
With him on the brief was Jeffrey S. Neeley.
Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division,
U.S. Department of Justice, of Washington, DC, argued for defendant. With her on the brief
were Melissa M. Devine, Trial Attorney, Benjamin C. Mizer, Principal Deputy Assistant
Attorney General, and Jeanne E. Davidson, Director. Of counsel on the brief was Whitney M.
RZBC GROUP SHAREHOLDING CO., LTD.,
RZBC CO., LTD., RZBC IMP. & EXP. CO.,
LTD., and RZBC (JUXIAN) CO., LTD.,
Plaintiffs,
v.
UNITED STATES,
Defendant,
and
ARCHER DANIELS MIDLAND COMPANY,
CARGILL, INCORPORATED, and TATE &
LYLE INGREDIENTS AMERICAS LLC,
Defendant-Intervenors.
Before: Richard W. Goldberg, Senior Judge
Court No. 15-00022
PUBLIC VERSION
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 1 of 32

Court No. 15-00022 	Page 2
Rolig, Attorney, Office of the Chief Counsel for Trade Enforcement and Compliance, U.S.
Department of Commerce, of Washington, DC.
Patrick J. Togni, King & Spalding LLP, of Washington, DC, argued for defendant-
intervenors. With him on the brief was Joseph W. Dorn.
Goldberg, Senior Judge: This case concerns the fourth administrative review of a
countervailing duty order on citric acid and certain citrate salts from the People’s Republic of
China (the “PRC”). See Citric Acid and Certain Citrate Salts from the People’s Republic of
China, 79 Fed. Reg. 78,799 (Dep’t Commerce Dec. 31, 2014) (final admin. review) (“Final
Results”) (covering imports from January 1, 2012 to December 31, 2012). Plaintiffs, the RZBC
Group Shareholding Co. and related companies (“RZBC”), sue to reduce the final countervailing
duty rate imposed on them by the U.S. Department of Commerce (“Commerce” or “the
agency”). Constituents of the U.S. domestic industry—including Archer Daniels Midland
Company, Cargill, Incorporated, and Tate & Lyle Ingredients Americas (“ADM”)—side with the
agency in defending the countervailing duty rate against these attacks.
After carefully considering the parties’ briefs and the record, the court remands one issue
to commerce for reconsideration: the adverse inference that RZBC benefited from the Buyer’s
Credit program.
GENERAL BACKGROUND
Countervailing duties serve the same purpose as their better-known cousins, antidumping
duties: They level the playing field between U.S. manufacturers and their overseas competition.
But each regime addresses a different problem. Antidumping duties were made to fight price
discrimination, so if a foreign producer sells goods in the United States for less than in the home
market, antidumping duties bring the U.S price back to fair value. See 19 U.S.C. § 1673 (2012).
Countervailing duties (“CVDs”), by contrast, were created to correct the cost-distorting effect of
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 2 of 32

Court No. 15-00022 	Page 3
subsidies. When a foreign government lends support to a producer, CVDs boost the producer’s
U.S. prices to offset the net benefit from the subsidy. See id. § 1671(a).
In the review underlying this appeal, Commerce imposed a 17.55% total CVD rate on
RZBC’s citric acid exports. Final Results, 79 Fed. Reg. at 78,800. With this duty, Commerce
aimed to offset the benefit RZBC received from concessional loans, steam coal, sulfuric acid,
limestone flux, land purchases, and other subsidies from the PRC. See I&D Mem. 14–32, PD
226 (Dec. 22, 2014). On appeal, RZBC contests aspects of Commerce’s work, including (1) the
agency’s decision to adversely infer that RZBC benefited from a concessional lending program
called the Buyer’s Credit program; (2) the decision to impose an adverse 10.54% rate with
respect to the Buyer’s Credit program; (3) the agency’s selection of benchmark sources for steam
coal, sulfuric acid, and limestone flux; (4) the agency’s selection of benchmark sources for a
land-purchase subsidy benchmark; and (5) the decision not to omit “special equipment services”
surcharges from certain price quotes used to calculate the international freight-rate component of
the limestone flux benchmark.
The court has jurisdiction to hear these claims under 28 U.S.C. § 1581(c). The court
must uphold the agency’s results unless they are “unsupported by substantial evidence on the
record, or otherwise not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i).
DISCUSSION
In light of this standard, the court remands for reconsideration Commerce’s adverse
inference that RZBC benefited from the Buyer’s Credit program. Given the remand on the
adverse-inference issue, the court has no cause to consider the validity of the ultimate 10.54%
adverse-interest rate. With respect to the remaining issues, the court sustains the Final Results in
full.
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 3 of 32

Court No. 15-00022 	Page 4
I. 	Commerce’s Adverse Inference that RZBC Benefited from the Buyer’s Credit
Program Lacks the Support of Substantial Evidence
In the underlying review, Commerce adversely inferred that RZBC benefited from the
Buyer’s Credit program, a concessional-loan program instituted by the Government of China
(“GOC”) owned EXIM Bank. I&D Mem. 75. The GOC and RZBC had represented that RZBC
received no benefit from the program, but the GOC refused to allow Commerce to verify this
representation by querying the EXIM Bank’s internal database of financing information. Id. at
74. Accordingly, Commerce found that RZBC benefited from concessional loans offered under
the Buyer’s Credit program and ascribed an adverse interest rate of 10.54%. Id. at 74–76.
RZBC argues that the GOC cooperated sufficiently at verification to preclude an application of
“adverse facts available” (“AFA”) premised on the GOC’s failure to cooperate. RZBC further
argues that, even if the GOC’s cooperation was insufficient, Commerce unduly rejected the
prospect of verifying non-use with RZBC, notwithstanding “neutral evidence on the record”
indicating that RZBC did not use the Buyer’s Credit program. Mem. of Law in Support of Pls.’
Mot. for J. on the Agency R. Under USCIT Rule 56.2, at 22, ECF No. 29. Therefore, says
RZBC, Commerce lacked grounds to adversely infer that RZBC drew benefit from the Buyer’s
Credit program. The court holds that Commerce’s adverse inference lacks the support of
substantial evidence.
A. Background
Commerce’s application of AFA, or adverse inferences, is governed by the two-step
analysis set forth in 19 U.S.C. § 1677e. First, Commerce is obligated to resort to “facts
otherwise available” if the agency finds that “necessary information is not available on the
record” or that an interested party or other person has withheld requested information,
significantly impeded Commerce’s proceeding, or provided information that Commerce must,
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 4 of 32

Court No. 15-00022 	Page 5
but cannot, verify under 19 U.S.C. § 1677m(i). 19 U.S.C. § 1677e(a). Second, Commerce has
discretion to draw an “inference that is adverse to the inferences of [a] party in selecting from
among the facts otherwise available” if the agency “finds that [the] interested party has failed to
cooperate by not acting to the best of its ability to comply with a request for information.” Id.
“Applying AFA” is shorthand for when Commerce makes affirmative findings under both steps
of 19 U.S.C. § 1677e and as a result draws an adverse inference.
In CVD proceedings, Commerce will sometimes draw an adverse inference due to a
foreign government’s lack of cooperation in providing requested information, as opposed to a
respondent’s. See Archer Daniels Midland Co. v. United States (ADM I), 37 CIT __, __, 917 F.
Supp. 2d 1331, 1342 (2013); GPX Int’l Tire Corp. v. United States, 37 CIT __, __, 893 F. Supp.
2d 1296, 1333 (2013); Fine Furniture (Shanghai) Ltd. v. United States, 36 CIT __, __, 865 F.
Supp. 2d 1254, 1262 (2012). Such an inference might nonetheless collaterally effect a
respondent, even though the respondent did nothing to incur the inference. ADM I, 37 CIT at __,
917 F. Supp. 2d at 1342; GPX, 37 CIT at __, 893 F. Supp. 2d at 1333; Fine Furniture, 36 CIT at
__, 865 F. Supp. 2d at 1262. Although these collateral effects can be excusable, Commerce must
strive to avoid them by examining the record. ADM I, 37 CIT at __, 917 F. Supp. 2d at 1342;
GPX, 37 CIT at __, 893 F. Supp. 2d at 1333; Fine Furniture, 36 CIT at __, 865 F. Supp. 2d at
1262. “When Commerce has access to information on the record to fill in the gaps created by
the lack of cooperation by the government, as opposed to [a respondent] . . . it is expected to
consider such evidence.” GPX, 37 CIT at __, 893 F. Supp. 2d at 1333.
In the review at issue here, Commerce drew its adverse inference that RZBC benefitted
from the Buyer’s Credit program based on the GOC’s failure to cooperate during a verification
meeting. In a questionnaire response leading up to the verification meeting, the GOC had stated
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 5 of 32

Court No. 15-00022 	Page 6
that it maintained a database of loans provided through the Buyer’s Credit program, and that the
database included the names of participating Chinese firms as well as their buyers. The GOC
also stated that, to the best of its knowledge, none of RZBC’s customers used the Buyer’s Credit
program. Commerce notified the GOC in the verification outline that the agency would seek on-
site access to the EXIM Bank’s database to confirm that none of RZBC’s buyers were listed as
beneficiaries of the Buyer’s Credit program. I&D Mem. 74. At verification, representatives of
the GOC orally reiterated that the EXIM Bank “maintains records of all lending provided under
the program.” Id. GOC representatives further stated that “they searched [the EXIM Bank]
records and found no entry for any of the customers’ names given to them by [RZBC].” Id. But
the GOC refused Commerce the requested database access on grounds that “proper
authorization” was required. GOC Verification Report 3, PD 207 (Oct. 8, 2014).
In lieu of database access, the GOC offered “screen shots of EXIM’s query results,”
which Commerce’s officials “declined to review.” Id. Commerce reasoned that without real-
time database access, Commerce could not sufficiently “test and confirm” RZBC and the GOC’s
purported non-use, per the agency’s “standard verification protocols.” I&D Mem. 74. In
Commerce’s view, by refusing database access, the GOC “prevent[ed] the verifiers from
completing their verification procedures” and “precluded the [agency] from verifying the non-
use claims made by [RZBC] and the GOC.” Id.
The GOC and RZBC rebutted that Commerce could verify non-use “at the company
level” (that is, with RZBC, instead of with the GOC). Id. at 73–74. In prior proceedings,
Commerce had determined that the GOC’s EXIM Bank was the “primary entity” with which the
agency could verify non-use of the Buyer’s Credit program. Id. 	Commerce had reasoned that,
based on the record available in those prior proceedings, the EXIM Bank appeared to disburse
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 6 of 32

Court No. 15-00022 	Page 7
loans to “the customers of Chinese producers”—i.e. to buyers, not to the Chinese producers
themselves. Id. But the GOC insisted that the EXIM Bank disbursed Buyer’s Credit funds
“directly to the Chinese producers,” rendering verification with RZBC feasible. Id.
To test the GOC’s claim, Commerce asked the GOC “whether the transfer of funds
directly to the Chinese producer was explicit in the Administrative Measures” that governed the
Buyer’s Credit program. Id. The EXIM Bank officials explained “that [the disbursement] was
not explicit in law, but understood in practice.” Id. a 74. So Commerce followed up by asking
the GOC for “sample contracts and documentation” to illustrate the usual disbursement song and
dance. Id. To allay confidentiality concerns, Commerce “provided . . . the option of redacting
all business proprietary information.” Id. But the GOC nonetheless “refused to provide the
requested information.” Id. In sum, although “[t]he GOC provided an oral explanation of how
[RZBC] might be involved in the application process and the disbursement of funds,” the GOC
never tendered the disbursement evidence of the sort that could be “tied to the EXIM Bank’s
audited financial statements.” Id. at 75. As a result, “[h]ad [Commerce] attempted to verify non-
use at [RZBC’s] facility with only declarative statements as guidance, [the agency] could have
done no more than speculate on how to confirm non-use; any procedures [Commerce] might
have undertaken . . . would have been guess work . . . concerning the operations of the program.”
Id. at 74–75. Commerce therefore declined the GOC’s invitation to verify non-use of the
Buyer’s Credit program with RZBC, and “continue[d] to find [that the agency’s] ability to
determine non-use . . . hinges on its ability to examine usage records in the possession of the
GOC.” Id. at 74.
Commerce also found that the GOC’s refusal to provide the information that the agency
had requested compelled the use of facts otherwise available. Id. at 75. And Commerce further
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 7 of 32

Court No. 15-00022 	Page 8
determined that the agency should draw an adverse inference regarding use of the Buyer’s Credit
program because “the GOC failed to cooperate by not acting to the best of its ability.” Id.
Accordingly, Commerce inferred that RZBC had benefited from the Buyer’s Credit program and
applied an AFA interest rate of 10.54%. Id. at 76.
B. Discussion
The court holds that Commerce’s adverse inference lacks the support of substantial
evidence. Commerce was justified in concluding that the GOC did not act “to the best of its
ability” during verification because the GOC refused Commerce’s requests for access to the
EXIM Bank’s database as well as “sample contracts and documentation.” Id. at 74–75; GOC
Verification Report 3. Likewise, Commerce had grounds to conclude that most of the “neutral
evidence on the record” invoked by RZBC did not amount to verifiable record evidence that
RZBC abstained from using the Buyer’s Credit program. Pls.’ Mot. for J. on the Agency R. 22.
But there is one piece of record evidence that appears as though it should have been verifiable.
Specifically, the record indicates that the Buyer’s Credit program is available only with respect
to sales contracts valued over $2 million dollars, and RZBC swore under penalty of perjury that
it had no such contracts. I&D Mem. 73; GOC NSA Resp. Ex. C-1, at art. 5, PD 78 (Mar. 19,
2014). Commerce never explained why it could not verify RZBC’s non-use of the Buyer’s
Credit program by checking the firm’s audited financial statements or other books and records
for the value of RZBC’s sales contracts. See I&D Mem. 73–75. Given that Commerce’s adverse
inference collaterally impacted RZBC (who bore the brunt of the 10.54% adverse interest rate),
the agency had an obligation to heed any verifiable evidence that RZBC never used the Buyer’s
Credit program. ADM I, 37 CIT at __, 917 F. Supp. 2d at 1342; GPX, 37 CIT at __, 893 F. Supp.
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 8 of 32

Court No. 15-00022 	Page 9
2d at 1333; Fine Furniture, 36 CIT at __, 865 F. Supp. 2d at 1262. As a result, Commerce’s
adverse inference that RZBC used the Buyer’s Credit program is unwarranted.
First, the court addresses what the agency got right. Commerce had grounds to find that
the GOC did not act “to the best of its ability” while Commerce was trying to verify non-use of
the Buyer’s Credit program. I&D Mem. 75. “Compliance with the ‘best of its ability’ standard
is determined by assessing whether [the] respondent has put forth its maximum effort to provide
Commerce with full and complete answers to all inquiries in an investigation. While the standard
does not require perfection and recognizes that mistakes sometimes occur, it does not condone
inattentiveness, carelessness, or inadequate record keeping.” Nippon Steel Corp. v. United
States, 337 F.3d 1373, 1382 (Fed. Cir. 2003). At the verification meeting, the GOC refused to
allow Commerce access to the EXIM Bank’s database even though Commerce had notified the
GOC in the Verification Outline that the agency would seek such access. I&D Mem. 74. The
GOC stated that the “proper authorization” had not been secured. GOC Verification Report 3. If
the GOC were acting to the best of its ability, it would have at the very least sought the necessary
authorization in advance. The GOC’s failure to do so smacks of “inattentiveness,” a hallmark of
less-than-best effort. Nippon, 337 F.3d at 1382.
RZBC rebuts that the GOC offered “screen shots” in lieu of database access. Pls.’ Mot.
for J. on the Agency R. 22. But screenshots are not what Commerce asked for, nor are they a
suitable substitute. Screenshot is just a fancy way to say picture, and a picture is something that
can be fabricated in anticipation of a meeting like the verification meeting. Access to a database,
by contrast, is interactive, hence tougher to spoof. Because, with database access, Commerce
would be able to request its own queries in real time, mucking with the results would be much
more difficult than with a picture. So screenshots are incommensurate with database access, and
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 9 of 32

Court No. 15-00022 	Page 10
therefore irrelevant in determining whether the GOC acted to the best of its ability. The fact
remains that the GOC failed to act to the best of its ability when it refused Commerce database
access.
Besides, the GOC also acted to less than the best of its ability in declining Commerce’s
requests for “sample contracts and documentation” that would illustrate the Buyer’s Credit
disbursement process. GOC Verification Report 3. Commerce sought the documents so the
agency could see whether verification with RZBC (as opposed to the GOC) would be feasible,
but the GOC refused on confidentiality grounds. Id. (In briefing, RZBC also raises
confidentiality as a concern with respect to the EXIM Bank’s database, even though it is not
clear that this concern was vocalized at verification. See Pls.’ Mot. for J. on the Agency R. 21–
22.) But Commerce was sensitive to the GOC’s confidentiality concerns, offering “the option of
redacting all business proprietary information” from the tendered samples. GOC Verification
Report 3. The GOC simply refused to do so without so much as proposing alternatives that
might be still more confidentiality-conscientious than Commerce’s offer. This cursory response
strikes the court as falling somewhere short of the “maximum effort” required by the best-of-its-
ability standard. Nippon, 337 F.3d at 1382. Commerce was therefore justified in concluding that
the GOC had not behaved to the best of its ability, both in refusing to provide sample contracts
and documentation and in denying access to the EXIM Bank’s database.
Commerce also weathers all but one of RZBC’s arguments that the agency “failed to
consider neutral evidence on the record [showing] non-use [of the Buyer’s Credit program] by
RZBC.” Pls.’ Mot. for J. on the Agency R. 22. RZBC begins by invoking the now-familiar rule
that Commerce must “seek to avoid an adverse impact [on a respondent] if relevant information
exists elsewhere on the record.” Id. RZBC further argues that “th[is] court has held that the
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 10 of 32

Court No. 15-00022 	Page 11
existence of and the amount of the benefit conferred [by a subsidy program] should be based on
the respondent parties’ information.” Id. RZBC notes that Commerce verified non-use of a
whopping eighty-two other programs, including the EXIM Seller’s Credit Program, with RZBC.
Id. at 23. When verifying non-use of those other programs, not once did Commerce find that
RZBC “reported inaccurately or failed to report a program.” Id. Yet Commerce still declined to
verify non-use of the Buyer’s Credit program with RZBC. And, according to RZBC, neutral,
verifiable record evidence suggests that RZBC eschewed the Buyer’s Credit program. Id.
Specifically, the record establishes that (1) RZBC, not its buyers, would have been the recipient
of any Buyer’s Credit loan disbursements, (2) RZBC would have been required to initiate and
cooperate in the Buyer’s Credit application process, and (3) eligible sales contracts would have
to be valued above $2 million. Id. at 26, 28. Notwithstanding these requirements, RZBC
disavowed ever participating in the Buyer’s Credit application process or having any sales
contracts valued above $2 million. I&D Mem. 73. The upshot, says RZBC, is that Commerce
could have verified RZBC’s claims of non-use by crosschecking RZBC’s audited financial
statements for disbursements, application participation, or hefty sales contracts. Pls.’ Mot. for J.
on the Agency R. 28.
For the most part the court disagrees, beginning with RZBC’s contention that the court
has imposed on Commerce an obligation to base “the existence of and amount of the benefit
conferred [by a subsidy program] . . . on the respondent parties’ information.” Id. at 22. No we
have not. The court has, at times, observed that foreign governments are typically in the best
position to provide information on how a subsidy program is administered, whereas respondents
are best situated to provide information on the particulars of the benefit conferred to them, if any.
See, e.g., Archer Daniels Midland Co. v. United States (ADM I), 37 CIT __, __, 917 F. Supp. 2d
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 11 of 32

Court No. 15-00022 	Page 12
1331, 1342 (2013) (citing Essar Steel Ltd. v. United States (Essar Steel CIT), 34 CIT 1057, 1070,
721 F. Supp 2d 1285, 1297 (2010), rev’d in part on other grounds, 678 F.3d 1268 (Fed. Cir.
2012)). But there remain instances in which this shorthand truism will not hold. Sometimes, for
instance, respondents simply will not have furnished Commerce with the information the agency
needs to formulate benefit benchmarks. E.g., Fine Furniture (Shanghai) Ltd. v. United States, 36
CIT __, __, 865 F. Supp. 2d 1254, 1262 (2012). Or perhaps, even if respondents claim to have
provided the necessary benefit information, Commerce will be obligated to verify the
information under 19 U.S.C. § 1677m(i), and the respondents’ information will not be amenable
to such rigorous examination. There is no per se rule that Commerce must, in every proceeding,
base the amount of the benefit conferred on the respondent parties’ data, whatever that data may
be. Rather, as already articulated, Commerce’s obligation when drawing an adverse inference
based on a lack of cooperation by a foreign government is to avoid collaterally impacting
respondents to the extent practicable by examining the record for replacement information.
ADM I, 37 CIT at __, 917 F. Supp. 2d at 1342; GPX, 37 CIT at __, 893 F. Supp. 2d at 1333; Fine
Furniture, 36 CIT at __, 865 F. Supp. 2d at 1262. This rule holds whether Commerce is drawing
the adverse inference as to the administration of a subsidy program, ADM I, 37 CIT at __, 917 F.
Supp. 2d at 1342, or as to the benefit to a particular respondent, Fine Furniture, 36 CIT at __,
865 F. Supp. 2d at 1262.
Most of the neutral record evidence invoked by RZBC does not cure the GOC’s lack of
cooperation because the information is unverifiable. RZBC argues that the GOC disbursed
Buyer’s Credit funds directly to Chinese producers, such that Commerce could verify RZBC’s
stated non-use by checking the firm’s audited financial statements for traces of any such
disbursements. Pls.’ Mot. for J. on the Agency R. 24–26. But Commerce properly inferred that
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 12 of 32

Court No. 15-00022 	Page 13
the Buyer’s Credit program disbursed to Chinese producers’ buyers, not to the producers
themselves. In previous reviews, Commerce determined that Buyer’s Credit funds were
disbursed to buyers. I&D Mem. 73. The GOC challenged this understanding in the instant
review, and Commerce asked the GOC for tangible proof in the form of sample contracts and
documentation. I&D Mem. 73–74. The GOC provided none. Id. So Commerce reendorsed its
disbursement-to-buyers determination. Id.
RZBC now points to two reports that ADM put on the administrative record, Pls.’ Mot.
for J. on the Agency R. 24–26, both of which detail the general application and disbursement
process for EXIM Bank’s concessional-loan programs (including the Buyer’s Credit program),
NSA Submission Exs. 18 & 19, PD 49 (Nov. 12, 2013). The reports suggest that Chinese
producers, not their buyers, receive loan disbursements. NSA Submission Ex. 18 at 4, Ex. 19 at
19. But the reports do not contradict Commerce’s determination, because they discuss the EXIM
Bank’s concessional lending programs generally, and provide no specific information on the
operation of the Buyer’s Credit program. The reports therefore cannot have compelled
Commerce to conclude that Chinese producers like RZBC received Buyer’s Credit
disbursements. Because Commerce’s disbursement-to-buyers determination stands, nothing
about the disbursement process lights a path to verification with RZBC.
Nor could Commerce verify non-use with RZBC on grounds that RZBC would have been
involved in the Buyer’s Credit application process, but said it was not. Here, RZBC offers
Article 14 of the Administrative measures, which lists Chinese producers’ “credit materials and
related supporting documents” as required documentation. Pls.’ Mot. for J. on the Agency R. 26
(citing GOC NSA Resp. Ex. C-1). RZBC also again invokes the two reports submitted by ADM.
Id. at 25. According to RZBC, if the EXIM Bank would demand credit materials and other
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 13 of 32

Court No. 15-00022 	Page 14
documents pertaining to Chinese producers, then the producers would necessarily be involved in
any application process and would therefore know if their buyers used the program. In light of
the evidence submitted by RZBC, the firm did have a reasonable basis to swear that it knew that
none of its buyers used the Buyer’s Credit program because RZBC never saw any applications.
But the problem is that verifying RZBC’s claim is nigh on impossible. The court cannot see a
way for Commerce to reliably tie RZBC’s potential involvement in an application process to
RZBC’s audited financial statements, or any other books and records. This being the case, “any
[verification] procedures [Commerce] might have undertaken at [RZBC] simply would have
been guess work based on assumptions concerning the operations of the program.” I&D Mem.
74–75. So the court cannot hold that Commerce could have verified non-use with RZBC simply
because RZBC would know whether RZBC was or was not involved in the application process.
But Commerce never explained why it could not verify non-use of the Buyer’s Credit
program by taking a peek at RZBC’s sales contracts. Article 5 of the Administrative Measures
suggests that the Buyer’s Credit program is unavailable with respect to sales contracts under $2
million dollars. GOC NSA Response Ex. C-1, at art. 5. As far as the court is aware, no other
evidence on the record contradicts Article 5’s $2 million dollar requirement during the period of
review. And when Commerce asked whether RZBC had “signed any single sales contract
exceeding two million U.S. dollars for a sale that included, in whole or in part, subject
merchandise to the United States,” the company said no. I&D Mem. 73; RZBC NSA Resp. 9,
PD 76 (Mar. 19, 2014). Based on this answer and the text of Article 5, verifying RZBC’s non-
use of the Buyer’s Credit program seems like it should have been a straightforward process:
Commerce could simply have checked RZBC’s audited financial statements or other books and
records for sales-contracts values (or perused whatever other documentation would satisfy
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 14 of 32

Court No. 15-00022 	Page 15
Commerce; one expects the value of RZBC’s sales contracts, unlike whether or not the company
helped with loan applications, to be internally documented). Commerce never provided any
explanation of why reviewing the sales contracts would not allow the agency to sufficiently
verify non-use of the Buyer’s Credit program. I&D Mem. 73–75.
We repeat once more, Commerce has an obligation to avoid collaterally impacting a
respondent with an adverse inference drawn as a consequence of a foreign government’s
noncooperation by consulting the record. ADM I, 37 CIT at __, 917 F. Supp. 2d at 1342; GPX,
37 CIT at __, 893 F. Supp. 2d at 1333; Fine Furniture, 36 CIT at __, 865 F. Supp. 2d at 1262. In
this case, the record appears to present easily verifiable evidence that RZBC did not use the
Buyer’s Credit program because it never signed a sales contract above $2 million. Commerce
never addressed this evidence. Therefore, on remand, Commerce must reconsider whether it can
verify RZBC’s non-use of the Buyer’s Credit program by inspecting RZBC’s audited financial
statements or other books and records for sales contracts valued over $2 million. If the agency
continues to conclude that verifying non-use with RZBC is impossible, then it must explain how
this can be the case in light of the $2 million threshold laid out in the Administrative Measures.
If, on the other hand, Commerce concludes that RZBC is in a position to verify non-use, then the
agency must either make an attempt at doing so or explain why not. 1
1 RZBC also attacks Commerce’s conclusion that verification at RZBC “would have been guess work
based on assumptions concerning the operations of the program” on grounds that, if Commerce had to guess about
how the Buyer’s Credit program worked, then the agency had no grounds to initiate its investigation of the program
under 19 U.S.C. § 1671a(b)(1). This argument fails because the standard for investigating a program is low, RZBC
Grp. Shareholding Co. v. United States, 39 CIT __, __, 100 F. Supp. 3d 1288, 1295 (2015), and distinct from the
requirement that Commerce verify certain information, see 19 U.S.C. §§ 1677e(a)(2)(D), 1677m(i).
Also, because the court holds that RZBC’s adverse inference lacks the support of substantial evidence, the
court does not reach the issue of whether Commerce’s 10.54% adverse interest rate is proper.
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 15 of 32

Court No. 15-00022 	Page 16
II. 	Commerce Properly Selected Benchmark Sources for Steam Coal, Sulfuric Acid,
and Limestone Flux
Among the inputs RZBC used to produce its citric acid were steam coal, sulfuric acid,
and limestone flux. Commerce calculated benchmarks for each of these inputs by selecting price
data from a variety of sources proposed by RZBC and ADM. See Preliminary Decision Mem.
17–19, 22, PD 146 (June 19, 2014); I&D Mem. 87–92. RZBC now takes issue with
Commerce’s selections. RZBC argues that Commerce was obligated to calculate benchmarks
using only a select set of prices that RZBC deemed “specific to RZBC’s inputs” in terms of
grade, specification, and quantity. Pls.’ Mot. for J. on the Agency R. 41, 44–45. The court
disagrees, and sustains Commerce’s selection of price data.
A. Background
Before turning to the merits, the court must first further explain Commerce’s benchmark
calculation process. Commerce’s benchmark calculations are governed by both statute and
regulation. Under 19 U.S.C. § 1677(5)(E)(iv), Commerce must set benchmarks that reflect
“prevailing market conditions.” The statute further defines prevailing market conditions as
including “price, quality, availability, marketability, transportation, and other conditions of
purchase or sale.”
19 C.F.R. § 351.511(a)(2) (2016) provides additional guidance on how Commerce sets
benchmarks. The regulation offers three methodological tiers in descending order of availability.
Under tier one, Commerce sets benchmarks using a “market-determined price . . . resulting from
actual transactions in the country in question. . . . In choosing [actual transactions, Commerce]
consider[s] product similarity; quantities sold, imported, or auctioned; and other factors affecting
comparability.” But sometimes market-determined prices are unavailable, in which case
Commerce drops to the second tier and uses a “world market price.” For Commerce to use a
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 16 of 32

Court No. 15-00022 	Page 17
world market price, “it [must be] reasonable to conclude that such price would be available to
purchasers in the country in question. [Furthermore, w]here there is more than one commercially
available world market price, [Commerce] will average such prices to the extent practicable,
making due allowance for factors affecting comparability.” If, however, “there is no [tier-two]
world market price available to purchasers in the country in question,” then Commerce repairs to
the third tier and calculates a benchmark “consistent with market principles.”
In the Preliminary Results, Commerce adversely inferred that actual Chinese market
prices for steam coal, sulfuric acid, and limestone flux were “significantly distorted by the
involvement of the GOC.” Preliminary Decision Mem. 5. As a result, tier one was not available,
and Commerce took the middle road, tier two, to calculate benchmarks. Id. at 5, 16, 18, 21. To
do so, Commerce needed at least one “world market price” for each of the three inputs. 19
C.F.R. § 351.511(a)(2)(ii).
ADM proposed that Commerce get some of its world market prices from the Global
Trade Atlas (“GTA”) published by Global Trade Information Services, Inc. Preliminary
Decision Mem. 16, 18–19, 21–22. GTA indexes commodity prices according to the Harmonized
Tariff Schedule (“HTS”), a system of four- to ten-digit classification codes in which longer
codes pertain to narrower classes of product. ADM provided Commerce with GTA prices for
anthracite coal (HTS 2701.11), bituminous coal (HTS 2701.12), sulfuric acid (HTS 2807), and
limestone flux (HTS 2521). Id. at 19; see I&D Mem. 87–90. For each of these products, though,
ADM only gave Commerce GTA prices from a limited list of countries curated by ADM.
Preliminary Decision Mem. 16. Besides the GTA prices, ADM also offered country-specific
prices from Platts for “various types of coal,” the IMF for steam coal, ICIS for sulfuric acid, and
Metal Bulletin for ground calcium carbonate (the last for the limestone flux benchmark). Id. at
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 17 of 32

Court No. 15-00022 	Page 18
16, 18–19, 22. RZBC countered ADM’s selected-country GTA submissions with a fuller suite
of GTA data for bituminous coal, sulfuric acid, and limestone flux. RZBC also submitted
country-specific coalspot.com prices for steam coal and CRU Group prices for sulfuric acid. Id.
at 17, 19, 21–22. See also Pls.’ Mot. for J. on the Agency R. 7.
Commerce tentatively accepted all of the parties’ proposed benchmark sources except the
GTA anthracite-coal data and the Platts data hailing from Colombia, Poland, Russia, and
Australia. Prelim. Decision Mem. 17, 19, 22. Commerce explained, “[i]n its questionnaire
response, [RZBC] indicated that it purchased bituminous coal in the production of citric acid;
therefore, we will utilize coal prices representative of the steam coal (i.e., thermal coal)
purchased by RZBC Companies.” Id. at 19. 2 	For RZBC’s sulfuric acid and limestone flux,
Commerce allowed all proposed prices. Id. at 17, 22. Commerce then averaged the various
benchmark prices to construct world market prices. Id. at 17, 19, 22.
RZBC objected on grounds that Commerce was obligated to “only utilize export prices
on the record that clearly demarcate a quantity of shipment, particle size or other nuanced
specification reflective of [RZBC’s] own specific input purchases.” I&D Mem. 90. In support
of its objection, RZBC cited both 19 U.S.C. § 1677(5)(E)(iv) and the tier-two regulation. RZBC
Case Br. 3–4, PD 213 (Oct. 20, 2014). With respect to the tier-two regulation, RZBC pointed
out that the regulation instructed Commerce to make “due allowance for factors affecting
comparability” when averaging prices to construct benchmarks. Id. (citing 19 C.F.R.
§ 351.511(a)(2)(ii)). To define “factors affecting comparability,” RZBC turned to the tier-one
regulation, which states that “the [s]ecretary will consider product similarity; quantities sold,
2 Evidently, Commerce and the parties agree that bituminous coal is steam coal is thermal coal, whereas
anthracite coal is something different. See, e.g., I&D Mem. 19; Pls.’ Mot. for J. on the Agency R. 54; RZBC
Rebuttal Factual Information Comments Ex. 1, PD 104 (May 1, 2014).
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 18 of 32

Court No. 15-00022 	Page 19
imported, or auctioned; and other factors affecting comparability.” Id. (citing 19 C.F.R.
§ 351.511(a)(2)(i)). Reading tier two in concert with tier one, RZBC deduced that “product
similarity” and “quantities sold” were both “factors affecting comparability” that Commerce was
obligated to consider when determining benchmarks. Id.
RZBC argued that only a few select benchmark sources satisfied the tier-two regulation
and the statute. With respect to steam coal, RZBC second-guessed Commerce’s rejection of
Platts data from Colombia, Poland, Russia, and Australia. I&D Mem. 88. According to RZBC,
these data were more specific to RZBC’s inputs than the GTA data that Commerce accepted,
which were “basket” data pertaining to bituminous coal exports generally. Id. At the least, if
Commerce was going to reject Platts data from the four aforementioned countries, Commerce
should have also rejected the GTA bituminous-coal data (and, it follows, used only RZBC’s
coalspot.com data to calculate the steam coal benchmark). Id.
Turning to sulfuric acid, RZBC argued that its proposed CRU Group prices were the only
prices specific to RZBC’s inputs in terms of quantity and quality. Id. RZBC purchased industrial
grade sulfuric acid by the tank load, and record evidence showed significant price differences
between various grades of sulfuric acid. Id. Because the CRU Group prices were specific to
bulk, industrial-grade purchases, Commerce should have used those prices. Id.
Finally, moving to limestone flux, RZBC argued that the only sufficiently specific prices
proposed by ADM were the Metal Bulletin prices pertaining to 50–22 micron limestone flux. Id.
at 88–89. The GTA data Commerce had accepted should have been excluded as basket data that
included prices for nonflux products such as bulk limestone and other calcareous material. Id.
And the Metal Bulletin prices pertaining to lower micron ranges also should have been excluded
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 19 of 32

Court No. 15-00022 	Page 20
because record evidence showed that RZBC purchased 60 micron limestone flux. Id. The 50–22
micron prices fell closest to RZBC’s inputs, so those were the only prices to use. Id.
Commerce rejected RZBC’s arguments in the Final Results. Commerce began by noting
that, notwithstanding RZBC’s citation to the tier-one regulation, the agency was setting
benchmarks under tier two. Id. at 90. In contrast to tier one, where Commerce would use
“actual transactions in the country in question” to set a benchmark, tier-two benchmarks were
supposed to represent a “world market price.” Id. at 90–91 (citing 19 C.F.R. § 351.511(a)(2)(i)–
(ii)). Constructing tier-two benchmarks using prices “solely reflective of a respondent’s
particularities, such as the size of its input purchases [or the inputs’ grades and
specifications] . . . would detract from calculating a truly world market price.” Id. at 91.
Commerce continued, “in interpreting this tier two benchmark regulation, it is the Department’s
practice to calculate a world market price that is as robust as possible in order to capture the
range of possible market prices and variances that occur when market principles govern
transactions.” Id.
To illustrate the perceived problem with calculating benchmarks using prices “solely
reflective of a respondent’s particularities,” Commerce used the sulfuric acid benchmark as an
example. Id. Were Commerce to take RZBC’s advice and reject the GTA sulfuric acid price
data in favor of CRU Group prices, Commerce would have to discard
hundreds of market prices from 64 countries in favor of 24 market prices from
northwestern Europe, Japan and South Korea. Limiting the abundant and available
world market price data on the record to the few data on the record that only and
explicitly reflect bulk shipments, results in a skewed benchmark that cannot be
considered a world market price.
Id.
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 20 of 32

Court No. 15-00022 	Page 21
In closing, Commerce noted that world market prices calculated using GTA data were
“reflective” of RZBC’s “particularities” in any case: To the extent that RZBC argued that
Commerce should only use bulk-pricing data, GTA data are “collected from customs agencies
around the world, and hence, represent industrial and commercial shipments of goods, which are
typically large.” Id.3
B. Discussion
The court agrees with Commerce that the agency properly selected benchmark sources
for steam coal, sulfuric acid, and limestone flux. Contrary to RZBC’s argument, Commerce was
not obligated to use only the narrow set of prices that RZBC identified as “specific to RZBC’s
inputs” in terms of grade, specification, and quantity. Pls.’ Mot. for J. on the Agency R. 41.
Under tier two, Commerce’s duty is simply to make “due allowance for factors affecting
comparability” when averaging benchmark prices. 19 C.F.R. § 351.511(a)(2)(ii). This means
that Commerce must at least “consider” the factors in the course of evaluating potential
benchmark sources. ADM I, 37 CIT at __, 917 F. Supp. 2d at 1345. But a price can ultimately
serve as a benchmark source so long as it is a “comparable market-determined price”—the priced
input need not be “identical” in order for Commerce to use it. Essar Steel Ltd. v. United States,
678 F.3d 1268, 1273 (Fed. Cir. 2012). 4
3 Commerce also rejected all Platts data in the Final Results, for reasons that are unimportant for this case.
Id. at 87.
4 See also Beijing Tianhai Indus. Co. v. United States, 39 CIT __, __, 52 F. Supp. 3d 1351, 1369 (2015)
(rejecting argument that Commerce erred “when it chose to average the available steel tube prices from [Italy, Iran,
and Ukraine], rather than selecting the Ukranian prices” because “although Commerce must use benchmark prices
for merchandise that is comparable to a respondent’s purchases to satisfy the regulation, there is nothing that
requires that it use prices for merchandise that are identical to a respondent’s purchases”); Archer Daniels Midland
Co. v. United States, 38 CIT __, __, 968 F. Supp. 2d 1269, 1277–78 (2014) (rejecting argument “that Commerce
should use benchmarks that are more specific to the grade of sulfuric acid used by RZBC”—in particular, that
Commerce should limit HTS tariff-heading price data to the ten-digit level, rather than including data from the four-,
six-, and eight-digit levels—because “[t]he selected benchmarks are comparable in the sense that they all reflect
world market prices for sulfuric acid (a commodity product) under [the four-digit HTS heading]” and “RZBC has
[footnote continued]
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 21 of 32

Court No. 15-00022 	Page 22
In this case, the prices Commerce used pertained to inputs that were comparable to
RZBC’s. Commerce derived its benchmarks in large part from GTA HTS data for the tariff
headings covering bituminous (or steam) coal, sulfuric acid, and limestone flux—i.e., the tariff
headings that correspond to RZBC’s inputs. Preliminary Decision Mem. 16–19, 21–22; see I&D
Mem. 87–90. Commerce drew the HTS data at the four- and six-digit levels. Preliminary
Decision Mem. 16–19, 21–22; see I&D Mem. 87–90. The court has previously approved tier-
two benchmarks predicated on HTS four- and six-digit tariff-heading prices when the respondent
fails to “demonstate[] that Commerce’s selection of benchmarks . . . is so distortive as to render
Commerce’s benchmark calculation unreasonable.” Archer Daniels Midland Co. v. United
States, 38 CIT __, __, 968 F. Supp. 2d 1269, 1277–78 (2014). That is precisely the case here,
because RZBC has not shown “variations in pricing” or “divisions within the [steam coal,
sulfuric acid, and limestone flux] market[s]” that would compel Commerce to deviate from the
HTS data. Id. at 79. And the remainder of Commerce’s benchmark sources are also acceptable,
because those sources, like the HTS data, offer prices for the same inputs that RZBC consumed.
Commerce’s benchmark sources were therefore comparable to RZBC’s inputs, which is
sufficient to satisfy the tier-two regulation.
III. 	Commerce Properly Selected Benchmark Sources for Certain Land Purchases
by RZBC
Commerce counted as a countervailable subsidy certain below-market land purchases that
RZBC made from the GOC in 2011. To set a benchmark for the land purchases, Commerce
not demonstrated that Commerce’s selection of benchmarks at the [four-, six-, and eight-]digit levels is so distortive
as to render Commerce's benchmark calculation unreasonable.”); Essar Steel CIT, 721 F. Supp. 2d at 1294 (rejecting
argument that Commerce acted “contrary to law when it regarded . . . [blast-furnace-grade] iron ore fines as
comparable” to plaintiff’s non-blast-furnace-grade fines because “[t]he regulation requires product comparability,
but does not mandate that the products be identical” and “[i]n its calculations, the Department considered differences
in iron content between the [blast-furnace-grade fines] and [plaintiff’s non-blast-furnace-grade] iron ore fines, and
adjusted the benchmark price accordingly”).
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 22 of 32

Court No. 15-00022 	Page 23
resorted to certain Thai industrial land prices. 5 RZBC now argues that Commerce should have
used a different set of Thai prices from Colliers because those prices are “more representative of
RZBC’s land purchases.” Pls.’ Mot. for J. on the Agency R. 48. The court sustains Commerce’s
selection of land benchmark sources.
A. Background
Commerce’s choice to countervail purchases of land by RZBC dates back to the review
before this one, the third review. During the third review period, RZBC purchased the rights to
three industrial plots of land in China’s Shandong province at below market value. RZBC Grp.
Shareholding Co. v. United States, 39 CIT __, __, 100 F. Supp. 3d 1288, 1303 (2015). Although
RZBC did not use this land in the manufacture of citric acid, Commerce countervailed the
purchases nonetheless. Id.
To do so, Commerce needed to set a benchmark. Commerce had already considered how
to set benchmarks for Chinese land purchases in Laminated Woven Sacks from the People’s
Republic of China, 73 Fed. Reg. 35,639 (Dep’t Commerce June 24, 2008) (final admin.
determination) (“Laminated Woven Sacks”) and accompanying I&D Mem. at Analysis of
Programs. In Laminated Woven Sacks, Commerce “determined that the most appropriate
[benchmark] . . . would be . . . the sales of certain industrial land in [Thai] industrial estates,
parks[,] and zones.” Id. To get Thai industrial-land sales data, Commerce turned up a number of
“Asian Industrial Property Reports.” Id. In this case’s third review, Commerce followed
Laminated Woven Sacks and used the same kind of reports to value RZBC’s land. See Citric
5 In the Final Results of the underlying review, Commerce indicated that it would use the same benchmark
(and, it follows, same underlying benchmark source) as it had in the third review. I&D Mem. 95. In the third
review, Commerce used a set of Thai industrial land prices. See Citric Acid and Certain Citrate Salts from the
People’s Republic of China, 79 Fed. Reg. 108 (Dep’t Commerce Jan. 2, 2014) (final admin. review) and
accompanying I&D Mem. at 28.
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 23 of 32

Court No. 15-00022 	Page 24
Acid and Certain Citrate Salts from the People’s Republic of China, 78 Fed. Reg. 34,648 (Dep’t
Commerce June 10, 2013) (prelim. admin. review) (“Citric Acid and Certain Citrate Salts Third
Review Preliminary Determination”) and accompanying Preliminary Results Calculation
Memorandum for RZBC 8, unchanged in Citric Acid and Certain Citrate Salts from the People’s
Republic of China, 79 Fed. Reg. 108 (Dep’t Commerce Dec. 7, 2009) (final admin. review)
(“Citric Acid and Certain Citrate Salts Third Review Final Determination”) and accompanying
Final Results Calculation Memorandum for RZBC 2–3. Commerce merely replaced the
outdated reports from Laminated Woven Sacks with four new reports pertaining to the four
quarters of 2010 (the third review period). 	The new reports were titled a bit differently, as the
Asian Marketview Reports.
In the fourth review (the one at issue in this case), RZBC sought for Commerce to use a
different source for the land benchmarks. Specifically, RZBC proposed that Commerce use two
Industrial Real Estate Market Reports, published by Colliers in the first and second halves of
2012. RZBC Benchmark Submission Ex. 25, PD 97 (Apr. 21, 2014). According to RZBC, the
Colliers reports would form better benchmarks because they were “more representative of the
actual land purchased by [RZBC]” because they included “industrial land prices from 13
provinces in Thailand, rather than the single price from the province of Bangkok [offered by the
Asian Marketview Reports] which is clearly not representative of [RZBC’s] land purchases.”
I&D Mem. 94. RZBC also argued that the Colliers reports were more contemporaneous to the
POR than the Asian Marketview Reports. Id.
Commerce declined RZBC’s invitation to use the Colliers reports to set benchmarks.
Commerce reasoned that the data from the Colliers reports was “not transaction-specific and
therefore [was] not reliable.” Id. at 95. By contrast, the Asian Marketview Reports selected by
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 24 of 32

Court No. 15-00022 	Page 25
Commerce in the third review “used actual transaction prices.” Id. Commerce also noted that
RZBC was wrong about the breadth of the Asian Marketview data: Far from being comprised of
“a single price from the province of Bangkok,” the data included “36 price points from five
provinces within Thailand.” Id. Finally, Commerce added that RZBC failed to demonstrate that
“(1) our land benchmark is not comparable to their land purchase[, and] (2) price points from
seven additional provinces would make the benchmark more representative.” Id.
B. Discussion
RZBC renews its ask for a Colliers-based benchmark before this court. RZBC argues
that the five provinces covered by the third-review reports are all “around Bangkok,” but that
Commerce “failed to address how [those five provinces] are similar to RZBC’s land
purchases[, which] are located far away from any major city center.” Pls.’ Mot. for J. on the
Agency R. 48. Given that the Colliers reports draw data from thirteen provinces (including
lower priced areas far from Bangkok), it is unclear to RZBC how Commerce’s current
benchmarks are “more representative” than their Colliers-based counterparts. Id. Commerce
preferred the Asian Marketview Reports because they reported “actual transactions” whereas the
Colliers reports were “not transaction-specific,” but RZBC argues that this does nothing to prove
that the Asian Marketview Reports better represent RZBC’s land purchases. Id.
Besides, RZBC questions whether the Asian Marketview Reports really are specific to
“actual transactions.” Id. at 47–48. RZBC says it cannot see for itself whether the Asian
Marketview Reports are transaction specific because Commerce did not bother to put the reports
on record. Id. at 48. RZBC also notes that the Asian Marketview Reports list pricing data in
U.S. dollars, which suggests that the data are not specific to actual Thai transactions. By contrast,
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 25 of 32

Court No. 15-00022 	Page 26
the Colliers reports list data in Thai Bhat, “which would seem to indicate that the reported
price[s] are based on actual Thai rates.” Id.
RZBC’s arguments miss the mark. Commerce’s primary reason for using the Asian
Marketview Reports was that the reports’ transaction specificity made them reliable in a way that
the non–transaction specific Colliers reports were not. I&D Mem. 95. Contrary to RZBC’s
arguments, there was sufficient indication that the Asian Marketview Reports really are
transaction specific, and transaction specificity was a good enough reason for the agency to
prefer the Asian Marketview Reports over the Colliers ones.
To begin with, Commerce sufficiently demonstrated that the Asian Marketview Reports
are transaction specific. Although Commerce did not place the Asian Marketview Reports on
this review’s record, Commerce supported its statement that the reports were transaction specific
with a citation to the third review—where the reports were on record (and also evidently
available online). Id.; Citric Acid and Certain Citrate Salts Third Review Preliminary
Determination, at 34,648 and accompanying Preliminary Results Calculation Memorandum for
RZBC 8. Given that RZBC was a party to the third review and therein contested Commerce’s
decision to countervail RZBC’s land purchases, see Citric Acid and Certain Citrate Salts Third
Review Final Determination, at 108 and accompanying I&D Mem. 64–65, the argument that
RZBC could not access the Asian Marketview Reports to confirm that they were transaction
specific comes across as disingenuous.
The court adds that besides putting the Asian Marketview Reports on record in the third
review, Commerce also specified that it had used the reports to form benchmarks in several past
proceedings, starting with Laminated Woven Sacks. Citric Acid and Certain Citrate Salts from
the People’s Republic of China, 78 Fed. Reg. 34,648 and accompanying Preliminary Results
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 26 of 32

Court No. 15-00022 	Page 27
Calculation Memorandum for RZBC 8. In the Laminated Woven Sacks preliminary
determination, Commerce stated that the reports offered prices for “the sales of certain industrial
land in industrial estates, parks and zones in Thailand.” Laminated Woven Sacks from the
People’s Republic of China, 72 Fed. Reg. 67,893, 67,909 (Dep’t Commerce Dec. 3, 2007)
(prelim. admin. determination). Commerce continued by noting that the Asian Marketview
prices came from “an independent and internationally recognized real estate agency with a long-
established presence in Asia.” Id. The description of Asian Marketview Reports as pertaining to
“sales” from a “real estate agency” clearly indicates that the reports are transaction specific. The
language of the Laminated Woven Sacks preliminary determination plus Commerce’s reference
to the third review, where the Asian Marketview Reports were on record, is sufficient to
demonstrate that the reports are transaction specific.
And the fact that the Asian Marketview Reports are transaction specific is enough to
justify their use over the non–transaction specific Colliers reports. There is a common-sense
reason that non–transaction specific price reports are “not reliable,” I&D Mem. 95, in the same
way as their transaction-specific counterparts: Transaction-specific reports provide the
opportunity to identify and compensate for outlier sales, whereas non–transaction specific reports
do not. Commerce’s own regulations reflect a preference for drawing benchmarks from
transaction-specific sources. Under 19 C.F.R. § 351.511(a)(2), Commerce first tries to calculate
benchmarks using “actual transactions in the country in question” before resorting to the second
and third tiers. Commerce therefore had ample basis for finding the Colliers reports unreliable
and for using the Asian Marketview Reports to generate benchmarks instead. 6
6 RZBC also argues that Commerce should not have countervailed RZBC’s land purchases in the first
place. The court already rejected this argument in RZBC, 39 CIT at __, 100 F. Supp. 3d at 1304.
Finally, RZBC argues that using the Colliers reports would be more “cons[ist]ent with the determinations
[footnote continued]
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 27 of 32

Court No. 15-00022 	Page 28
IV. 	Commerce Properly Calculated the International Freight Component of the
Limestone Flux Benchmark
In accordance with 19 C.F.R. § 351.511(a)(2)(iv), Commerce adjusted its limestone flux
benchmarks to reflect the price an importer of limestone flux would pay, including international
freight. 	Commerce arrived at its chosen freight rate by averaging three sets of international
shipping quotes that the parties had provided, one of which pertained to shipping in “flat-rack
collapsible” containers. I&D Mem. 25; ADM Benchmark Submission Ex. 4, PD 96 (Apr. 21,
2014); RZBC Benchmark Submission Ex. 22, PD 103 (Apr. 21, 2014). The flat-rack quotes
included a “special equipment service” surcharge over and above the cost of shipping in standard
containers. ADM Benchmark Submission Ex. 4. RZBC argues that Commerce should have
omitted the surcharge, because limestone flux could be shipped in standard containers. The court
sustains Commerce’s freight-rate calculation.
A. Background
19 C.F.R. § 351.511(a)(2)(iv) instructs Commerce to adjust its benchmarks “to reflect the
price that a firm actually paid or would pay if it imported the product.” The regulation further
provides that “[t]his adjustment will include delivery charges and import duties.”
As freight-rate fodder, RZBC provided shipping quotes from Maersk and Searates.
RZBC Benchmark Submission Ex. 22. The Maersk quotes referenced the shipment of “salt,
[S]ulpher, earths and stone, plastering materials, lime, cement, marble, [and] granite” in
“standard” containers. Id. ADM also provided Maersk shipping quotes, but ADM’s quotes
pertained to flat-rack collapsible containers, as opposed to standard ones, and included the
made by this Court in Zhaoqing New Zhongya Aluminum Co. v. United States [(Zhaoqing I), 37 CIT __, __, 929 F.
Supp. 2d 1324 (2013)] and Zhaoqing New Zhongya Aluminum Co. v. United States [(Zhaoqing II), 38 CIT __, __,
961 F. Supp. 2d 1346, 1352 & n.8 (2014)].” The court will not consider this argument because RZBC did not raise
it below. RZBC Case Br. 19–20; see 28 U.S.C. § 2637(d) (“[T]he Court of International Trade shall, where
appropriate, require the exhaustion of administrative remedies.”).
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 28 of 32

Court No. 15-00022 	Page 29
aforementioned surcharge. ADM Benchmark Submission Ex. 4. Commerce averaged all three
sets of shipping quotes in the Preliminary Results without first removing the surcharge from the
flat-rack quotes. Preliminary Decision Mem. 22.
RZBC objected to Commerce’s inclusion of the surcharge in the three-set average.
RZBC argued that including the “special equipment service” surcharge in the average stood “in
sharp contrast to every other case where the ‘flat rack collapsible container rates’ were placed on
the record.” I&D Mem. 80. According to RZBC, in two prior proceedings, Commerce had
omitted the surcharge on grounds that the record lacked evidence that flat-rack containers were
required to ship the relevant input—in those proceedings, steel-round billets. See id. at 80 &
n.423 (citing Certain Seamless Carbon and Alloy Steel Standard, Line, and Pressure Pipe from
the People’s Republic of China, 75 Fed. Reg. 57,444 (Dep’t Commerce Sept. 21, 2010) (final
admin. determination) (“Seamless Carbon and Alloy Steel Pipe”) and accompanying I&D Mem.
cmt. 9.C; Oil Country Tubular Goods from the People’s Republic of China, 78 Fed. Reg. 9368
(Dep’t Commerce Feb. 8, 2013) (prelim. admin. review) (“Oil Country Tubular Goods
Preliminary Administrative Review”) and accompanying I & D Mem. cmt. 1.A). Moreover,
RZBC placed on record quotes for shipping limestone flux in standard containers, the very
existence of which suggested that flat-rack containers were not necessary. Id.
Commerce did not accept RZBC’s arguments in the final results. Commerce succinctly
explained,
In [Oil Country Tubular Goods (one of the proceedings relied upon by RZBC),]
there was sufficient information on the record . . . to conclude that the respondent
did not incur the “flat rack” “special equipment service” fee. 	However, in the
instant review, [RZBC] did not provide information on the record that it does not
incur these fees; therefore, we will continue to use the international freight pricing
data on record and will not make any changes for the final results.
Id. at 80–81.
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 29 of 32

Court No. 15-00022 	Page 30
B. Discussion
The court upholds Commerce’s decision to factor the “special equipment service”
surcharge into its limestone flux international-freight rate. Based on the record evidence, the
court cannot conclude that it would be inappropriate to import limestone flux in flat-rack
containers. The standard-container quotes on record do not delineate the usual use cases for
standard-container shipment of limestone flux, much less establish that standard-container
shipment is always feasible. See RZBC Benchmark Submission Ex. 23. The same is true of
another piece of evidence invoked by RZBC in its reply brief: a Wikipedia article that lists “Bulk
minerals,” including “limestone,” as commodities shippable in unpackaged, standard-container
form. RZBC Benchmark Submission Ex. 19, PD 103 (Apr. 22, 2014). The article simply
establishes that shipping limestone flux in standard containers is sometimes suitable, not that it is
always suitable. Id. Without evidence that limestone flux is invariably shipped in standard
containers, the court cannot rule out the possibility that flat-rack shipment is sensible or
necessary at least some of the time. Therefore, it was not unreasonable for Commerce to
calculate the freight-rate average without first omitting the “special equipment service”
surcharge. 7
7 RZBC again argues that this result is inconsistent with prior proceedings in which Commerce omitted the
“special equipment service” surcharge from the freight-rate average for steel-round billets. But the proceedings that
RZBC cites all follow the final determination in the Oil Country Tubular Goods investigation, where the record
included “evidence that no special services were needed to ship steel billets and rounds.” RZBC, 39 CIT at __, 100
F. Supp. 3d at 1313 n.7 (2015) (citing Certain Oil Country Tubular Goods from the People's Republic of China, 74
Fed.Reg. 64,045 (Dep’t Commerce Dec. 7, 2009) (final admin. determination) (“Oil Country Tubular Goods Final
Determination”) and accompanying I&D Mem. cmt. 13.D; Oil Country Tubular Goods Preliminary Administrative
Review, at 9368 and accompanying I&D Mem. at 1.A (relying on Oil Country Tubular Goods Final Determination
to hold that shipping steel-round billet did not incur a “special equipment service” surcharge); Seamless Carbon and
Alloy Steel Pipe at 57,444 and accompanying I&D Mem. cmt. 9.C (same)). In particular, the Oil Country Tubular
Goods Final Determination record included a shipper’s statement that “[s]teel billet shipments for our
customers . . . were not made using flat rack containers.” The record in this case, like the record before the court in
the preceding RZBC case, is bereft of any comparable evidence that shipping limestone flux in flat-rack collapsible
containers was inappropriate.
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 30 of 32

Court No. 15-00022 	Page 31
CONCLUSION AND ORDER
After carefully reviewing the parties’ briefs and the administrative record, the court
remands Commerce’s decision to adversely infer that RZBC used the Buyer’s Credit program.
The court sustains Commerce’s benchmark calculations in full.
Accordingly, it is hereby:
ORDERED that the final determination of the International Trade Administration,
United States Department of Commerce, published as Citric Acid and Certain Citrate Salts from
the People’s Republic of China, 79 Fed. Reg. 78,799 (Dep’t Commerce Dec. 31, 2014) (final
admin. review), be, and hereby is, REMANDED to Commerce for redetermination; it is further
ORDERED that Plaintiffs’ Motion for Judgment on the Agency Record Under USCIT
Rule 56.2 be, and hereby is, GRANTED as provided in this Opinion and Order; it is further
ORDERED that Commerce shall issue a redetermination (“Remand Redetermination”)
in accordance with this Opinion and Order that is in all respects supported by substantial
evidence and in accordance with law; it is further
ORDERED that Commerce shall reconsider whether it can verify RZBC’s non-use of
the Buyer’s Credit program by inspecting RZBC’s audited financial statements or other books
and records for sales contracts valued over $2 million; it is further
ORDERED that if Commerce concludes that it cannot verify non-use with RZBC, then it
must explain how this can be the case in light of the $2 million threshold laid out in the
Administrative Measures; it is further
ORDERED that if Commerce concludes that it can verify non-use with RZBC, then it
must either attempt to do so or explain why not; it is further
ORDERED that Commerce shall recalculate Plaintiffs’ countervailing duty rate
consistent with the results of its reconsideration; it is further
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 31 of 32

Court No. 15-00022 	Page 32
ORDERED that Commerce shall have ninety (90) days from the date of this Opinion and
Order in which to file its Remand Redetermination, which shall comply with all directives in this
Opinion and Order; that the Plaintiffs and Defendant-Intervenors shall have thirty (30) days from
the filing of the Remand Redetermination in which to file comments thereon; and that the
Defendant shall have thirty (30) days from the filing of Plaintiffs’ and Defendant-Intervenors’
comments to file comments.
/s/ Richard W. Goldberg
Richard W. Goldberg
Senior Judge
Dated: June 30, 2016
New York, New York
Case 1:15-cv-00022-RWG Document 54 Filed 07/12/16 Page 32 of 32