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Federal Register / Vol. 62, No. 28 / Tuesday, February 11, 1997 / Notices6209Premier states that, in numerouscases, the courts have held that theDepartment cannot penalize a companyfor failing to provide information it doesnot have, citing Olympic Adhesives v.United States, 899 F.2d 1565 (Fed. Cir.1990) (Olympic Adhesives), and Allied-Signal Aerospace Company v. UnitedStates, 996 F.2d 1185 (Fed. Cir. 1993)(Allied-Signal). Premier notes that inAllied-Signal (page cite omitted) thecourt reversed the Department’sapplication of a punitive BIA to arespondent who had ‘‘supplied as muchof the information as it could.’’ WhilePremier acknowledges that the issuebefore the court in Allied-Signal was theDepartment’s characterization of arespondent as uncooperative, Premierargues that the court’s criticism of theDepartment’s decision to apply punitiveBIA is applicable to the circumstancesin this review, in which Premiercooperated to the extent that it could.Premier contends that subsequent courtdecisions have followed the OlympicAdhesives rationale, ruling that theDepartment cannot apply adverse BIAwhen deficiencies in a respondent’sdata are due to factors outside itscontrol (citing Usinor Sacilor v. UnitedStates, 872 F. Supp. 1000 (CIT 1994)(Usinor Sacilor), Zenith v. UnitedStates, Slip Op. 94–146 (September 19,1994), and Hyster v. United States, 848F. Supp. 178, 188 (CIT 1994)).Premier asserts further that theDepartment’s BIA policy is not bindingin all cases and that the Department hasretreated from its policy when the factswarranted doing so. Premier argues thatthe Department has recognized thatthere are situations in which strictapplication of its BIA policy leads toresults which are inconsistent with thepurpose of the policy, i.e., to treatcooperative respondents less harshlythan uncooperative respondents.Premier notes that the Department hasmodified its standard two-tieredapproach in the past where strictapplication of this methodology wouldresult in aberrational margins (citingCertain Steel Products from Mexico, 58FR 37352 (July 9, 1993), andProfessional Electric Cutting Tools andProfessional Electric Sanding GrindingTools from Japan, 58 FR 30144 (May 26,1993)). Premier notes that, inManifattura Emmepi S.p.A. v. UnitedStates, Slip Op. 93–183 (September 15,1993), the court upheld theDepartment’s decision to apply BIAbased on the highest calculated rate inthe immediately preceding review,when following its traditional twotieredBIA approach would haveresulted in a de minimis margin.Instead, Premier notes that theDepartment selected an alternative ratewhich was ‘‘adverse enough.’’ Premierclaims that selecting a rate for acooperative respondent that is the sameas that for an uncooperative one will notserve the Department’s BIA policy, as itwould discourage cooperation.Premier suggests that, in this case, theDepartment could reasonably usealternatives to its two-tieredmethodology. Premier proposes that,consistent with the Department’spreference to consider a respondent’sown prior rates when selecting BIA fora ‘‘cooperative’’ respondent, theDepartment could apply, as BIA, thehighest rate calculated for Premier inany prior segment of the proceeding,0.97 percent from the 1987–88 and1988–89 reviews, as well as the ratefrom the LTFV investigation. Premiersuggests, alternatively, that theDepartment could select a rate whichdistinguishes properly betweenuncooperative and cooperativerespondents, such that the BIA marginselected for ‘‘cooperative’’ respondentsshould not be the same as that for‘‘uncooperative’’ respondents.Chin Jun states that the Department’sapplication of punitive BIA to some ofits sales is contrary to legal precedent.Chin Jun claims that, in accordancewith section 773(e)(2) of the Act, theDepartment may use an adverseinference if it finds that a party hasfailed to cooperate by not acting to thebest of its ability to comply with arequest for information. Chin Jun arguesthat it has cooperated to the best of itsability and, despite its cooperation, theDepartment has drawn an adverseinference and applied punitive BIA.Chin Jun claims that, while theDepartment’s preliminary results didnot state that the BIA rate imposedagainst Chin Jun was punitive, it clearlywas. Chin Jun states that the courtreaffirmed that, ‘‘ in order for theagency’s application of the bestinformation rule to be properlycharacterized as ‘‘punitive,’’ the agencywould have had to reject low margininformation in favor of high margininformation that was demonstrably lessprobative of current conditions,’’ citingAllied-Signal (page cite omitted). ChinJun claims that this is precisely the casehere, in which the Department rejectedlow-margin information available infavor of high-margin BIA.Chin Jun notes that, while theDepartment has discretion as to thechoice of BIA, this discretion must beexercised reasonably (citing HolmesProducts Corp. v. United States, 795 F.Supp. 1205, 1207 (CIT 1992)) (HolmesProducts). Respondent contends that theDepartment is not permitted to take anoverly sweeping view of the authority itis granted under section 773(e)(2), citingOlympic Adhesives.Chin Jun also claims that theregulations allow the Department toconsider the degree of a particularrespondent’s cooperation in theadministrative review as a factor indetermining what constitutes the bestinformation available. Chin Jun insiststhat it did not refuse to provideinformation nor did it significantlyimpede the review, but that it wassimply unable to obtain certain FOPinformation from all of its unrelatedsuppliers. Chin Jun states that the courthas ruled that, when deficiencies arebeyond a respondent’s control, theapplication of punitive BIA is improper,citing Usinor Sacilor.Chin Jun claims that, in HolmesProducts, the Department improperlyrejected the use of weighted-averageinformation from the respondent andapplied an adverse BIA rate. The courtrequired the Department to use certaindata supplied by the respondent, as thatrespondent had substantially compliedwith the Department’s request andcould not control the conduct of anuncooperative affiliate. Chin Jun addsthat the court pointed out that use ofaveraged data for substantiallycomplying parties has been approvedand applied in other contexts.Chin Jun claims that its circumstancesare even more compelling than thosefound in Usinor Sacilor and in HolmesProducts. Chin Jun states that, in thiscase, the alleged lack of FMV data wasa result of unrelated third parties’’failure to provide a response to thefactors questionnaires. Chin Jun assertsthat, in Usinor Sacilor and HolmesProducts, the courts held that theDepartment cannot punish a respondentwhen a related, yet uncooperative,affiliate did not supply requestedinformation and argues that it is evenmore inexcusable for the Department topunish Chin Jun when unrelated,uncooperative parties failed to providecertain information.Chin Jun states that it is important toview the Department’s actions in thecontext of generally accepted litigationparameters such as those set forth in theFederal Rules of Civil Procedure. ChinJun claims that Federal Rule of CivilProcedure 45 governing subpoenas onlydirects production of ‘‘designated books,documents, or tangible things in thepossession, custody or control of thatperson.’’ While the Department maylack ‘‘subpoena power’’ in anantidumping duty review, Chin Junargues, it is unreasonable for theDepartment to interpret its statutory