Enforcement, the Aluminum 232, scope challenges, and our upcoming Sunset Review will be generating a lot of activity in our trade case in the coming months. This month, I want to walk through the key issues we will be handling during the balance of this year and into 2022.
At the top of the list is enforcement. The Aluminum Extruders Council is currently working on two Enforce and Protect Act (EAPA) claims and a scope challenge in the Kingtom matter. Having won preliminary decisions in both EAPA claims, our focus has moved to finalizing those decisions before the end of 2021 and using the basis for our victory to defend ourselves against the scope challenge Kingtom filed a couple of weeks ago. In that scope challenge, Kingtom claims they should be excluded from any duties because all the extrusions exported to the U.S. were produced in the Dominican Republic. This, of course, flies in the face of the findings from Customs that Kingtom did in fact comingle Chinese extrusions and local production in those exports. Therefore, we are confident we will prevail in all these matters.
Meanwhile, we have begun processing data in our renewed efforts to identify transshipment. I will keep you in the loop about our findings as much as I can. From anecdotal accounts, we believe Canada and Mexico are being used as third countries to transship Chinese extrusions into the U.S. The reason we struggle with proving this is that we cannot get granular data about shipments from those two countries as we can from seaborne imports. I am working with vendors now to find the best available source for the data we want. Meanwhile, it is time to take a fresh look at Vietnam and several other countries. Overall, imports of aluminum extrusions have been running at the highest level since we filed our case against China. We do not believe transshipment is responsible for all this volume. Displacement is another reason. By this I mean that China has been dumping extrusions into a given country, and the extruders in that country are coming to the U.S. seeking new customers in order to survive. This is not illegal, but it can be grounds for an antidumping/countervailing duty case. The third reason may be tied to the impacts from the 232.
The AEC, working with Mayer Brown, has developed a White Paper discussing the impacts of the generally accepted exclusion (GAE) orders put down by Commerce in December that ended the offsetting 232 tariffs on extrusions. We do think this has exacerbated the growing demand for imported extrusions. This is especially the case when the exporting country does not pay a premium. These concerns are expressed in our White Paper. We are working on a meeting with the newly appointed members in the Department of Commerce in charge of the 232 and the GAE orders so we can express our position in person. We aim to have that meeting before the end of July.
We have several scope challenges that have worked their way into the courts. Inevitably, these cases come down to what is a final finished product and the interpretation of our orders. For the last several years, the courts have viewed our scope just as we intended. This has brought a string of decisions in our favor. These decisions have set a precedent that really protect our interests over time. Therefore, we have every reason to be optimistic about the pending cases. The most recent of them is the case about the hybrid window wall/curtain wall product imported by Reflections. This case should be heard by the Court of International Trade sometime in the first half of 2022. We believe the pending court cases will rule in our favor and bolster even more our interpretation of a final finished product that will help us win the Reflections matter on appeal. More to come on this.
In September at our Aluminum Summit, you will hear more about our preparations for our Sunset Review. We all need to be prepared to gather production and operating data in the same way we have in the past for this review. Furthermore, we will need sales information about business you have quoted and then lost to the Chinese, as well as any business you had to concede price to keep. Anything that demonstrates China is still active and impactful to our domestic industry will be helpful. We cannot wait to gather this information in the first quarter of 2022. Instead, this needs to be gathered in real time, as much as possible, and documented in a way you can present to our attorneys as we put the actual filing together in late Q1, 2022. The bottom-line is that we need to show that the Chinese trade orders have helped our industry, and even so, the Chinese remain a viable threat to our industry – especially if the orders are not renewed.
Thank you all for your continued support. Keep the reports coming. If you see something that looks suspicious, let us know. Working together, we can help find the pieces of a puzzle that might disclose a major enforcement issue.
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