On March 26, 2015, the Court of International Trade (CIT) issued an opinion rejecting a Russian Fertilizer Company’s challenge to the inclusion of one of its products in the U.S. antidumping order on solid fertilizer grade ammonium nitrate from Russia.   The Company, Kirovo-Cheptesky Khimichesky Kombinat, JSC, is part of Uralchem OJSC, (Uralchem) which is the largest ammonium nitrate producer in Russia.  As a result of this opinion, Uralchem’s imports of ammonium nitrate will continue to be subject to the 253.98 % antidumping margin imposed by the order.

Uralchem advanced several arguments which were all rejected by the CIT in favor of arguments proposed by the Department of Commerce (Commerce) and the petitioners, CF Industries, Inc. and El Dorado Chemical Company (petitioners).  One of Uralchem’s primary arguments was that its solid fertilizer product, known as NS 30:7, differed from products subject to the order because the chemical compound of NS 30:7 contains only 32.2% “uncombined ammonium nitrate” and the majority of NS 30:7, 59.1%, is a “pair of double salts of ammonium nitrate and ammonium sulfate.”  Despite Uralchem’s arguments that the double salt compound is distinct from ammonium nitrate, the Court approved the analysis used by Commerce which found the double salts are partially composed of ammonium nitrate and have the same agricultural function as ammonium nitrate fertilizer and thus should be subject to the order.

Another primary argument of Uralchem was that Commerce inappropriately rejected a submission containing factual information by Uralchem while accepting a submission containing factual information by the petitioners.  This argument focused on a specific December 21, 2012 deadline for factual submissions.  Uralchem argued that its’ submission over five months later on May 29, 2013 was improperly rejected because it did not contain new factual information but was a “response to Commerce.”  While the CIT did state that Commerce’s guidelines were not a “model of clarity,” the Court found Commerce was reasonable within the appropriate level of deference in interpreting their own regulations.

Furthermore, Uralchem argued that Commerce was prejudicial to allow the petitioners to submit factual information after the December 21, 2012 deadline.  However, the Court agreed with Commerce’s decision to accept the petitioner’s information because the petitioners timely requested and received an extension for the filing.   As seen in other cases, such as American Power Pull Corp. v. United States, following the distinct and strict protocol of AD/CVD procedure can be a decisive factor in the outcome of AD/CVD challenges.  Thus, this case is another example of how administrative procedure is crucial in AD/CVD investigations and scope determinations.

If you have questions about AD law or scope challenges, please contact Frohsin & Barger at (205)-933-4006 ext. 5.