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American Alliance for
Hardwood Plywood
Impact of 2016 Antidumping (AD) and Countervailing Duty (CVD)
Petition against Chinese Hardwood Plywood
IWPA Convention San Francisco, CA
April 6, 2017
AAHP BACKGROUND
Formed in late 2012 - An organization of leading American importers, distributors & manufacturers of hardwood plywood
Members include both IWPA members and non-members
The AAHP successfully defeated the 2012 petition
Has remained strong and unified for 4+ Years
Once again acting as lead voice defending against a flawed petition
Presentation will show why IWPA members, and at-risk parties, need to get more actively involved
AAHP Members Include
PRACTICALLY SPEAKING
Imports arriving after April 17th will very likely incur (currently unknown) Preliminary CVD rates paid in cash deposits
The DOC deadline to sign the Preliminary AD determination is June 16
ITC Final Phase hearing date not yet set - Estimated Late October/ Early November 2017 with Final Determination expected 30 days after
Historically CVD lower than AD rates but we are in a TRUMPIAN world now
Initial duties may be retroactive by 90 days if Critical Circumstances are found
Exposure to additional duties on both CVD and AD begins the date final ruling is posted in the Federal Register thru the ANNUAL Administrative Review process
Net effect of the petition and future retroactive liability is to DETER subject imports immediately - if not indefinitely
Retroactivity AD/CVD law retroactive in nature, rather than prospective
Duties set by DOC but what CBP collects are estimated deposits only
System works with an Investigation (now) followed by a series of annual Administrative Reviews that recalculate duties / retroactively adjust
Petitioning industries like the uncertainty of the US retroactive system because it discourages all imports, whether or not unfair
Reviews can basically go on.. and on indefinitely
Importers ultimate liability cannot be known
How would one go about selling????
PRODUCTS WITHIN THE SCOPE List is too long/wide for this presentation
Carve-outs that existed in 2012 case have largely been removed
Scope has not been finalized, can change over time
Scope Clarifications Best discussed with professional DOC counsel
Generally/Cynically
Hardwood Plywood products the Petitioners historically havent produce
Dont currently produce
Dont want to focus their operations on and/or
Cannot make in sufficient quantity to support US demand
SCOPE COMPLEXITY
Scope language so wide
If not tightened up, will make CBPs tasks more challenging
Will potentially lead to heightened scrutiny
Scope Challenges
Major Retailers Ikea, Target, Others filed motions related to crossover of HTS codes for HWPW vs finished goods (RTA furnishing and cabinetry)
Major US Furniture industry Raised objections to define scope
Hardwood Plywood vs Component parts vs RTA Furniture vs RTA Cabinets
What can we expect?
Costs & Risk - To become increasing unknown now & going forward
Market Volatility & Uncertainty - Highly probable, almost certain
Transition Period
Markets will adjust but process takes time
Cannot immediately replace the total volume supplied to the US market
Ports / steamship lines / transport companies - adversely effected at least temporarily
Opportunity & Loss - There will be winners and losers
Scrutiny CBP / Enforce and Protect
Plywood Version 1.0 vs 2.0
Scope is much wider now
Petitioners counsel has changed
Political climate has changed considerably (TRUMP + Anti-China)
2016 case will be the first DOC/ITC case litigated during the Trump Admin
Success before the ITC in 2013, while certainly encouraging, does not mean history will repeat nor does 2016 Prelim defeat = Final defeat
AAHP remains strong and unified with same Legal/Economic Defense Team
3 out of the 5 current commissioners voted negative in the 2012 case
The Bottom Line
Disruptions- Dramatic disruptions in supply and increased cost on both imported and domestic plywood products
Long Lasting - If the AAHP is unsuccessful in our ITC Defense efforts, there will be long lasting, negative effects on many businesses
Made in America? More American Jobs at risk in downstream industries
Finished Kitchen Cabinet Imports Positive FD will push some U.S. cabinet MFGS to move production
offshore - eliminating US jobs - to ensure they retain market share, and remain competitive against non-dutiable RTA cabinets
Consequences If we lose, case could help further grow a potentially dominant kitchen cabinet industry..IN CHINA
Take a leadership position in public opposition
Have a key downstream customer quoted in a PR position piece
Post our PR pieces on your websites
Confidential affidavits from you or your largest customers
Help us expand the Alliance make up
Get actively involved and further educate & inform your customer base
Donate financially to the AAHP
Join the AAHP as a fully active member, or as an associate member, publicly or anonymously
IWPA Members Active Participation Needed
What can interested companies do to
help fight this case?
Educate your congressmen & senators to stand up to the petitioners
ITC Questionnaires - Your professional response to the questionnaires is nothing short of vital
Remember
At the ITC, its ONE for all, all for ONE
The ITC has the final word
Professional, Intelligent, Academics, Non-Partisan
Represent our one chance to win this caseAgain
CARPE DIEM
AAHP Informational Meetings
Current AAHP Members will hold a meeting tomorrow from 12-1 PM
Immediately following, the AAHP BOD welcomes non-members to attend an informational meeting w/ Lead Counsel, Jeff Grimson
This meeting is designed to address specific questions about the case and discuss methods of involvement and support
Both meeting will take place in the Bay View Room
www.aahp-org.com
Questions and Answers