Yesterday, the U.S. Department of Commerce self-initiated country-wide anti-circumvention inquiries involving imports of aluminum foil from China that are completed or finished in Thailand and South Korea. These imports are inappropriately avoiding the payment of antidumping and countervailing duties on imports of aluminum foil from China, pursuant to unfair trade orders published by the Commerce Department in April 2018.

“We commend the Commerce Department for taking this important step to enforce our trade laws,” said Charles Johnson, president and CEO of the Aluminum Association. “This decision demonstrates strong initiative and a commitment to maintaining these hard-won gains for U.S. manufacturing. We look forward to working closely with the department to ensure a successful outcome as these inquiries progress.”  

The Commerce Department will soon issue questionnaires to the suspected duty evaders, provide opportunities for interested parties to submit information relevant to the agency’s proceedings and issue a preliminary determination, which will likely occur in the coming months. The investigation is expected to take approximately one year to complete. 

The aluminum foil subject to the Commerce Department’s inquiry includes flat-rolled aluminum products that are 0.2 mm or less in thickness (less than 0.0079 inches) in reels weighing more than 25 pounds and that is not backed, is produced in China and finished in Thailand and South Korea. Certain aluminum foil is used extensively in food and pharmaceutical packaging, household foil, thermal insulation, cables, electronics, and heating, ventilation and air conditioning (“HVAC”) applications, and other heat transfer products where properties such as light weight, resistance to corrosion, and formability are desired.

In April 2018, the Commerce Department published antidumping and countervailing (AD/CVD) orders on certain aluminum foil imports from China following an action by the Aluminum Association’s Trade Enforcement Working Group. The final combined dumping and subsidy rates ranged from 55 to 176%. Since those orders were published, U.S. imports of certain aluminum foil from China have declined substantially. 

However, Chinese exports of foil and sheet-gauge products to Thailand and South Korea have increased significantly, and U.S. imports of aluminum foil from those countries produced from Chinese metal have also increased substantially, as Chinese producers have sought to “work around” the AD/CVD duties assessed on foil exported directly from China to the United States.

The Aluminum Association Trade Enforcement Working Group is represented in these inquiries by John M. Herrmann, Paul C. Rosenthal, and Joshua R. Morey of the law firm Kelley Drye & Warren LLP.