Case: 18-2194   Document: 46   Page: 1   Filed: 06/15/2020




   United States Court of Appeals
       for the Federal Circuit
                ______________________

  JINKO SOLAR CO., LTD., JINKO SOLAR IMPORT
   & EXPORT CO., LTD., JINKOSOLAR (U.S.) INC.,
                    Plaintiffs

 YINGLI GREEN ENERGY AMERICAS, INC., YINGLI
  GREEN ENERGY HOLDING COMPANY LIMITED,
           CANADIAN SOLAR, INC.
              Intervenor-Plaintiffs

                          v.

                  UNITED STATES,
                     Defendant

          SOLARWORLD AMERICAS, INC.,
            Intervenor-Defendant-Appellant

 --------------------------------------------

          SOLARWORLD AMERICAS, INC.,
                Plaintiff-Appellant

                          v.

                  UNITED STATES,
                  Defendant-Appellee

    HANWHA SOLARONE (QIDONG) CO., LTD.,
   HANWHA SOLARONE HONG KONG LIMITED,
 YINGLI GREEN ENERGY AMERICAS, INC., YINGLI
  GREEN ENERGY HOLDING COMPANY LIMITED,
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2                      JINKO SOLAR CO., LTD. v. UNITED STATES




                CANADIAN SOLAR, INC.,
                  Intervenor-Defendants
                 ______________________

                        2018-2194
                  ______________________

    Appeal from the United States Court of International
 Trade in Nos. 1:15-cv-00080-CRK, 1:15-cv-00086-CRK,
 Judge Claire R. Kelly.
                  ______________________

                  Decided: June 15, 2020
                  ______________________

    TIMOTHY C. BRIGHTBILL, Wiley Rein, LLP, Washington,
 DC, for appellant. Also represented by LAURA EL-SABAAWI,
 USHA NEELAKANTAN, MAUREEN E. THORSON.

      TARA K. HOGAN, Commercial Litigation Branch, Civil
 Division, United States Department of Justice, Washing-
 ton, DC, for appellee. Also represented by JOSEPH H.
 HUNT, JEANNE DAVIDSON; KRISTEN MCCANNON, JAMES
 HENRY AHRENS, II, Office of the Chief Counsel for Trade
 Enforcement & Compliance, United States Department of
 Commerce, Washington, DC.
                  ______________________

     Before NEWMAN, TARANTO, and STOLL, Circuit Judges.
 NEWMAN, Circuit Judge.
     The antidumping duty petition culminating in this ap-
 peal was filed by SolarWorld Americas, Inc. (“SolarWorld”)
 concerning certain photovoltaic products imported from
 the People’s Republic of China (“PRC”). This case arises
 from a Department of Commerce (“Commerce”) antidump-
 ing duty investigation, reported at Certain Crystalline Sil-
 icon Photovoltaic Products From the People’s Republic of
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 JINKO SOLAR CO., LTD. v. UNITED STATES                    3



 China, 79 Fed. Reg. 44,399 (Dep’t Commerce July 31, 2014)
 (“Preliminary Determination”); 79 Fed. Reg. 76,970 (Dep’t
 Commerce Dec. 23, 2014) (“Final Determination”). Appeal
 from these determinations was taken to the Court of Inter-
 national Trade (“CIT”), and after two remands the CIT af-
 firmed the rulings of Commerce. 1
     This appeal to the Federal Circuit is directed to two of
 the issues reviewed by the CIT: first, Commerce’s selection
 of Harmonized Tariff Schedule (“HTS”) Heading 7604 for
 valuation of the aluminum frame inputs to the photovoltaic
 modules; and second, Commerce’s method of offsetting the
 antidumping duty cash deposit rate to account for export
 subsidies.
     We review Commerce’s rulings on the same standards
 as applied by the CIT, and give “great weight to the in-
 formed opinion of the CIT.” Downhole Pipe & Equip., L.P.
 v. United States, 776 F.3d 1369, 1374 (Fed. Cir. 2015) (al-
 terations omitted). We now affirm the decisions on appeal.
                               I
     Valuation of the Aluminum Frame Inputs
     On petition filed by domestic industry, Commerce de-
 termines whether an imported product is sold in the United
 States at less than fair value. Commerce must make “a fair
 comparison . . . between the export price or constructed ex-
 port price and normal value.” 19 U.S.C. § 1677b(a). When
 a product is imported into the United States from a non-
 market economy country, as China is designated, then in
 order to achieve a fair market price comparison, Commerce



     1  Jinko Solar Co. v. United States, 229 F. Supp. 3d
 1333 (Ct. Int’l Trade 2017) (“CIT Op.”); Jinko Solar Co. v.
 United States, 317 F. Supp. 3d 1314 (Ct. Int’l Trade 2018)
 (“CIT Dec.”).
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4                      JINKO SOLAR CO., LTD. v. UNITED STATES




 determines the “normal value” of the subject merchandise
 in a comparable market economy. This value is determined
 by valuing the factors of production and other commercial
 factors, as set forth in 19 U.S.C. § 1677b(c)(1)(B):
    [T]he normal value of the subject merchandise [is
    determined] on the basis of the value of the factors
    of production utilized in producing the merchan-
    dise and to which shall be added an amount for
    general expenses and profit plus the cost of con-
    tainers, coverings, and other expenses. . . . [T]he
    valuation of the factors of production shall be based
    on the best available information regarding the
    values of such factors in a market economy country
    or countries considered to be appropriate by the ad-
    ministering authority.
 To value the aluminum frame inputs for the photovoltaic
 modules imported from China, Commerce selected market
 data for comparable imports under South African HTS sub-
 heading 7604. The CIT summarized Commerce’s findings
 as follows:
    Commerce found that the best available infor-
    mation by which to value respondents’ aluminum
    frames was the average value of South African im-
    ports under subheading 7604.29.65, HTS (“Alumi-
    num alloy bars, rods and profiles, other than hollow
    profiles of a maximum cross-sectional dimension
    not exceeding 370 mm”), rather than Thai imports
    under subheading 7616.99, HTS, (“Articles of alu-
    minum not otherwise specified or indicated: other”)
    covering a more diverse array of aluminum prod-
    ucts.
 CIT Op. at 1351 (citing Certain Crystalline Silicon Photo-
 voltaic Products From the People’s Republic of China, Is-
 sues & Dec. Mem., A-570-010, POI Apr. 1, 2013–Sept. 30,
 2013, at 48–50 (Dep’t of Commerce Dec. 15, 2014) (adopted
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 in 79 C.F.R. 78,036 (Dec. 29, 2014)) (“Final Decision
 Memo”).
     SolarWorld argues that Commerce selected the incor-
 rect HTS classification for these products, and that the CIT
 erred in sustaining Commerce’s classification on the
 ground of “reasonableness.”        SolarWorld argues that
 HTS 7604 undervalues the aluminum frame input, and
 “did not accurately account for the additional processing
 that the input has undergone.” SolarWorld Br. 3.
      This question of valuation of aluminum frames as in-
 puts was before this court in a concurrent appeal, now re-
 ported at SolarWorld Americas, Inc. v. United States, 910
 F.3d 1216 (Fed. Cir. 2018) (“SolarWorld I”). These appeals
 arose on different administrative records in Commerce.
 The appeal leading to SolarWorld I was co-pending with
 this appeal, and the decision issued after completion of
 briefing in the present appeal. The Jinko Solar plaintiffs
 (Jinko Solar Co., Ltd.; Jinko Solar Import & Export Co.,
 Ltd.; and, Jinko Solar (U.S.) Inc.) and the Yingli plain-
 tiffs/defendants (Yingli Green Energy Americas, Inc.;
 Yingli Green Energy Holding Company Limited) that are
 parties to the present appeal were also parties to Solar-
 World I. 2
     In SolarWorld I, this court reviewed the decision of the
 CIT reported at SolarWorld Americas, Inc., v. United
 States, 273 F. Supp. 3d 1314 (Ct. Int’l Trade Oct. 31, 2017).
 On the question of valuation of the aluminum frame



     2    The record states that the present proceeding was
 necessitated to “close a ‘loophole’ that resulted when pro-
 ducers subject to the Solar I investigations . . . increased
 imports of modules assembled in the PRC with non-PRC
 cells so as to avoid the reach of the Solar I orders.” Final
 Decision Memo at 17 (internal citation omitted).
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6                      JINKO SOLAR CO., LTD. v. UNITED STATES




 inputs, this court reviewed Commerce’s decision and that
 of the CIT, and concluded that:
    Thai HTS Heading 7604 still constitutes the best
    available information under § 1677b(c)(1)(B), given
    the other similarities detailed above between
    Yingli’s inputs and the products covered by Thai
    HTS Heading 7604.
 SolarWorld I, 910 F.3d at 1223. The selection of HTS clas-
 sification under Heading 7604 is also the question of the
 present appeal.
      In SolarWorld I the court explored all of SolarWorld’s
 arguments regarding valuation of the aluminum frame in-
 puts. For example, SolarWorld argues that HTS 7604
 should not apply, compared with HTS 7616, because alu-
 minum frames that have corners do not meet the definition
 of “profiles” under HTS 7604. SolarWorld also argues that
 Commerce erred in finding that “the frames are not of uni-
 form cross section along their entire length as required in
 the Chapter Notes to Chapter 76.” CIT Op. at 1352; id. at
 1353 (explaining that Commerce found that “the frames’
 corners ‘are only a small part of the aluminum frames used
 to build solar modules,’” and that it “is discernible that
 Commerce considers the corners [] not significant to alter
 the article from those covered by [HTS 7604.29]” (quoting
 Final Decision Memo at 50)).
     The court in SolarWorld I had also reviewed the rela-
 tionship between a prior classification by Customs and
 Border Protection (“CBP”) that had selected HTS 7616 as
 applicable to the subject aluminum frames. The CIT again
 sustained Commerce’s position that it is not bound by Cus-
 toms’ rulings, but “is bound instead by its statutory re-
 quirement to value inputs using the best available
 information.” CIT Op. at 1352 (citing Final Decision Memo
 at 49). This court sustained Commerce’s position and af-
 firmed CIT’s decision. SolarWorld I, 910 F.3d at 1225. The
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 same argument is presented herein, arguing the same Cus-
 toms rulings for the same products.
     Thus SolarWorld again argues that the aluminum
 frames are incorrectly classified under HTS Heading 7604
 as factors of production, and that HTS Heading 7616 is the
 correct classification. SolarWorld states that although
 “based on different administrative records, both appeals in-
 volve the selection of a surrogate value for aluminum
 frames used in solar modules.” SolarWorld Br. 1. No dis-
 tinction is proposed between these frames as a factor of pro-
 duction of the solar modules.
     We affirm the CIT’s decision that “Commerce’s use of
 subheading 7604.29.65, HTS, to value respondents’ alumi-
 num frames is supported by substantial evidence.” CIT Op.
 at 1353. That ruling is affirmed.
                              II
             Offset of Cash Deposit Rates
     SolarWorld criticizes Commerce’s methodology in im-
 plementing the statutes concerning the setting of anti-
 dumping duty cash deposit rates and offsetting these rates
 to account for countervailed export subsidies.
     After Commerce has determined that the imported
 merchandise is being, or is likely to be, sold in the United
 States at less than fair value, Commerce estimates the
 weighted average dumping margin 3 for each exporter and
 producer, and orders the posting of a cash deposit or bond
 based on the estimated dumping margin. 19 U.S.C.
 § 1673d(c)(1)(B). Relevant to the cash deposit, 19 U.S.C.



     3  The dumping margin is “the amount by which the
 normal value exceeds the export price (or the constructed
 export price) of the subject merchandise.” 19 U.S.C.
 § 1677b(a)(2).
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8                       JINKO SOLAR CO., LTD. v. UNITED STATES




 § 1677a(c)(1)(C) requires adjustment of the export price by
 increasing “the amount of any countervailing duty imposed
 on the subject merchandise . . . to offset an export subsidy.”
      The purpose is to avoid the double application of duties.
 Commerce explains that the theory “underlying
 [§ 1677a(c)(1)(C)] is that in parallel AD and CVD investi-
 gations, if [Commerce] finds that a respondent received the
 benefits of an export subsidy program, [the statute] pre-
 sume[s that] the subsidy contributed to lower-priced sales
 of subject merchandise in the United States.” Final Deci-
 sion Memo at 38; see Galvanized Steel Wire From the Peo-
 ple’s Republic of China, Issues & Dec. Mem., A-570-975,
 POI July 1, 2010–Dec. 31, 2010, at 18 (Dep’t of Commerce
 Mar. 19, 2012) (adopted in 77 Fed. Reg. 17,430 (Mar. 26,
 2012) (explaining that the statute “requires a full adjust-
 ment of AD duties for CVDs based on export subsidies in
 all AD proceedings”).
      Here, Commerce offset the antidumping cash deposit
 rate by the cash deposit rate for certain subsidies in the
 parallel countervailing duty investigations. Certain Crys-
 talline Silicon Photovoltaic Products From the People’s Re-
 public of China, Memorandum to the File, A-570-010 (Dep’t
 Commerce Mar. 5, 2015) (adjusting dumping margin using
 rates in the companion countervailing duty investigation).
 The amount of export subsidies herein were determined by
 Commerce based on adverse facts available (“AFA”) in the
 companion CVD investigation. 19 U.S.C. § 1677e(b) pro-
 vides that when an “interested party has failed to cooper-
 ate” with requests for information, Commerce “may use an
 inference that is adverse to the interests of that party in
 selecting from among the facts otherwise available.” Mav-
 erick Tube Corp. v. United States, 857 F.3d 1353, 1360
 (Fed. Cir. 2017).
     SolarWorld states that this offset, which lowers the an-
 tidumping duty margin, has the unintended effect of neu-
 tralizing the effect of the adverse inference in the
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 JINKO SOLAR CO., LTD. v. UNITED STATES                      9



 countervailing duty investigation. SolarWorld argues that
 as a result, the respondents may “achieve a more favorable
 result from their failure to cooperate than they would have
 if they cooperated fully.” SolarWorld Br. 24. SolarWorld
 states that Commerce’s methodology is not reasonable, and
 is contrary to law. The government observes that the stat-
 ute is silent as to whether Commerce must offset cash de-
 posit rates, and states that “SolarWorld has not explained
 why it would be more reasonable for Commerce to apply
 the adverse inference to the respondents twice.” Gov’t Br.
 18.
     The CIT addressed SolarWorld’s argument that Com-
 merce’s offset practice negates the purpose of the adverse
 inference, that is, deterring non-compliance with Com-
 merce’s investigations. The CIT explained that an adverse-
 facts-available based export subsidy reflects the “amount
 of an export subsidy that actually benefited the subject
 merchandise,” and that in estimating a subsidy rate based
 on an adverse inference, Commerce is guided by both “cre-
 ating a proper deterrent to non-cooperation” and the stat-
 utory “corroboration requirement . . . which requires that
 the AFA rate ‘be a reasonably accurate estimate of the re-
 spondent’s actual rate.’” CIT Op. at 1360 (quoting F.lli De
 Cecco Di Filippo Fara S. Martino S.p.A. v. United States,
 216 F.3d 1027, 1032 (Fed. Cir. 2000)).
      The CIT held that Commerce’s offset practice is reason-
 able under the statutory plan, because it “fosters con-
 sistency in investigations and administrative reviews.”
 CIT Op. at 1359–60 (citing Final Decision Memo at 39).
 The CIT explained that 19 U.S.C. § 1677a(c)(1)(C) provides
 for “offset [of] an export subsidy” through an increase in the
 export price or calculated export price by “the amount of
 any countervailing duty imposed on the subject merchan-
 dise.” Id. at 1360. The CIT reasoned that in calculating an
 export subsidy rate based on adverse facts available, “Com-
 merce is guided not only by creating a proper deterrent to
 non-cooperation,” but “also by the corroboration
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 10                     JINKO SOLAR CO., LTD. v. UNITED STATES




 requirement in 19 U.S.C. § 1677e(c), which requires that
 the AFA rate ‘be a reasonably accurate estimate of the re-
 spondent’s actual rate.’” Id. (quoting De Cecco, 216 F.3d at
 1032). The CIT explained that Commerce, in balancing ac-
 curacy and deterrence, “cannot avoid double-counting the
 export subsidy (i.e., including the export subsidy in the
 CVD cash deposit rate while also including it in the AD
 cash deposit rate) without also undermining the deterrent
 effect of the adverse inference (i.e., reducing the combined
 cash deposit rate).” Id.
     The CIT concluded that “Commerce reasonably exer-
 cised its discretion to offset the AD margin by the AFA CVD
 rate to avoid estimating duties in the AD cash deposit rate
 that are reflected in the CVD cash deposit.” Id. The CIT
 held that Commerce’s practice is reasonable because it en-
 sures that the adverse inference is applied only once. Id.
 at 1359.
     We review administrative agency actions on the stand-
 ard of Chevron U.S.A., Inc. v. Natural Resources Defense
 Council, Inc., 467 U.S. 837 (1984), whereby if “the intent of
 Congress is clear, that is the end of the matter;” id. at 842,
 but if the statute is ambiguous or does not include the as-
 pect at issue, then the agency’s interpretation must be ac-
 cepted unless it is “procedurally defective, arbitrary or
 capricious in substance, or manifestly contrary to the stat-
 ute.” Ningbo Dafa Chem. Fiber Co. v. United States, 580
 F.3d 1247, 1253 (Fed. Cir. 2009) (applying Chevron to an-
 tidumping determinations).
      We have considered the concerns raised by SolarWorld,
 and conclude that Commerce’s practice with respect to off-
 set of cash deposit rates reasonably implements the stat-
 ute. This practice balances the dumping margin against
 deterrence, lowers the combined antidumping/countervail-
 ing cash deposit rate, and avoids the inequity of double ap-
 plication of duty. This practice was considered by the CIT
 in light of the statute, and the practice of Commerce was
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 JINKO SOLAR CO., LTD. v. UNITED STATES                   11



 deemed to be a reasonable implementation of the statutory
 purposes of balancing import value and facilitating inves-
 tigation. The CIT’s decision on this aspect is affirmed. See
 SKF USA, Inc. v. United States, 537 F.3d 1373, 1379 (Fed.
 Cir. 2008) (“Deference to an agency’s statutory interpreta-
 tion is at its peak in the case of a court’s review of Com-
 merce’s interpretation of the antidumping laws.” (brackets
 and internal quotation marks omitted) (quoting Koyo Seiko
 Co. v. United States, 36 F.3d 1565, 1570 (Fed. Cir. 1994))).
                        CONCLUSION
     The decision of the Court of International Trade is af-
 firmed.
                        AFFIRMED
     Each party shall bear its costs.
