Commerce 'Prematurely' Agreed Not to Collapse Indian Ceramic Tile Respondent With Affiliates, Petitioner Says

Commerce selected Antiqa and Win-Tel, the two largest exporters of Indian-origin ceramic tile, as its investigation’s two mandatory respondents. But the department should have collapsed exporter Antiqa with two affiliates, Marbonite and Segam, petitioner Coalition for Fair Trade in Ceramic Tile said in the motion; it also should have found that exporter Win-Tel was affiliated with another company, Neelson.

Further, Commerce shouldn’t have let Antiqa revise its sales databases after verification, the petitioner said.

Antiqa asked Commerce to exclude Marbonite and Segam before answering the department’s first questionnaire, the coalition said. Commerce granted the request “without even a cursory affiliation and collapsing analysis,” it said. But, soon after, in a response brief to the coalition’s opposition, Antiqa asked for “yet another exclusion” for a third affiliate that was rejected as “premature,” it said.

The department shouldn’t have excluded Marbonite and Segam, either, the coalition said. The unusual nature of its decision to do so was underlined by the fact that it “return[ed] to its normal practice” in regard to the third affiliate, “Affiliate A,” the coalition said.

Further, substantial evidence supported collapsing the three entities, it said.

For example, it said Antiqa had “conceded” that ownership of Marbonite was equally split between the Kundariya family, which also controls Antiqa, and another party, Prism Johnson. The Kundariya family selected Marbonite’s managing director, the coalition noted. Antiqa and Marbonite also share two other “directors/partners” and have transacted together in the past, it said.

Commerce, justifying its decision, claimed that “no Kundariya family members are shareholders either directly or indirectly in Prism Johnson,” the petitioner said. That argument was a “red herring,” it said, because it wasn’t asking to have Antiqa and Prism Johnson collapsed -- it was asking to have Antiqa and Marbonite collapsed. And, inconsistent with that argument, the department had acknowledged that Marbonite and Antiqa had overlapping board members, it said.

The department was also wrong that Antiqa and Segam lacked a “significant overlap of directors/partners” and “intertwined operations,” the coalition argued, as evidence showed otherwise. And Commerce itself preliminarily determined that the two did share “significant common ownership,” it said.

The Coalition for Fair Trade in Ceramic Tile also claimed that Commerce should have found that Win-Tel was affiliated with Neelson because Neelson supplies a third of Win-Tel’s ceramic tile. Moreover, one of the Kundariya family members who control Win-Tel also helped Neelson receive a loan, demonstrating Win-Tel’s control of Neelson, it said.

Commerce erroneously denied the affiliation because it found that Neelson’s sales to Win-Tel were “miniscule,” (sic) it said.

And the department was wrong to find that the loan assistance was insignificant, it claimed. Commerce made its decision, based on the word of Win-Tel, because a Kundariya family member who provided Neelson collateral for its loan “took steps to have his collateral released from the bank which secured the original loan”; even though the bank hadn’t actually done so yet by the time of the investigation, the coalition said.

Finally, the department shouldn’t have let Antiqa provide it “five ‘minor’ corrections” to its sales reporting at verification, it said. One of those corrections “was methodological in nature and had an extensive impact on the sales reporting,” it said.

Then, after verification, Commerce asked Antiqa to submit revised sales databases based on those corrections by a deadline set only 16 days before the investigation’s final determination, the petitioner said. That went against the statutory requirement that Commerce verify all the information it used in making an investigation determination, it said.