The U.S. Department of Commerce has reaffirmed a March ruling that found shipments from a Chinese warm-water shrimp firm are liable for anti-dumping duties.
Shantou Red Garden Food Processing Co. and a related entity, Shantou Red Garden Foodstuff Co. Ltd. – also known collectively as Shantou Red Garden Foods – sold frozen shrimp from China in the U.S. at “less-than-normal value” during the period spanning 1 February, 2018, through 31 January, 2019, according to a ruling from the department.
U.S. importers of Red Garden shrimp are now exposed to a liability of over USD 3.6 million (EUR 3 million) due to a weighted-average dumping margin of 58.9 percent applied by the Department for the period 1 February to 31 January, 2019.
The Department of Commerce also found that Shantou Red Garden Food Processing was not entitled to an exemption given to a similarly named firm – Red Garden Food Processing Co. Ltd. – because the ownership structure has changed.
The current Red Garden claimed the firm was not liable for antidumping duties thanks to the result of a dispute settlement proceeding brought by the Chinese government at the World Trade Organization in 2004. But the Commerce Department ruled the firm is not “successor-in-interest” of the company previously operating as Red Garden, which no longer exists in its 2004 form.
According to the Commerce Department, Red Garden was formed in 2003 out of a foreign joint venture between Vernon, California, U.S.A.-based Red Chamber Co., via its affiliate, Seattle, Washington, U.S.A.-based Aqua Star, and Shantou, China-based Shantou RGFS.
However, the Commerce Department ruled the current form of the company is a limited liability company owned by Chinese nationals, not a foreign joint venture, and has no board of directors, making it ineligible for exclusion from antidumping regulations.
“We are grateful to the U.S. Department of Commerce for conducting a thorough investigation of Shantou Red Garden,” Southern Shrimp Alliance Executive Director John Williams said. “We think this is the correct result and shows, once again, the Trump administration’s commitment to the effective enforcement of our trade laws.”
Photo courtesy of Chuchai/Shutterstock
