Hynix Semiconductor Inc. v. United States

Slip Op. 05-106

UNITED STATES COURT OF INTERNATIONAL TRADE

HYNIX SEMICONDUCTOR INC.,
HYNIX SEMICONDUCTOR AMERICA INC.,

Plaintiffs, Before: Richard W. Goldberg,
Senior Judge
v.
Court No. 03-00651
UNITED STATES,

Defendant,

and

INFINEON TECHNOLOGIES, NORTH
AMERICA CORP. and MICRON
TECHNOLOGY, INC.,

Defendant-
Intervenors.

OPINION

[Commerce’s final affirmative countervailing duty determination
remanded for further consideration and explanation of financial
contribution analysis.]

Dated: August 26, 2005

Willkie, Farr & Gallagher, LLP (Daniel Lewis Porter and James
Philip Durling) for Plaintiffs Hynix Semiconductor Inc. and
Hynix Semiconductor America Inc.

Peter D. Keisler, Assistant Attorney General; David M. Cohen,
Director; Jeanne Davidson, Deputy Director, Commercial
Litigation Branch, Civil Division, U.S. Department of Justice
(David F. D'Alessandris) for Defendant United States.

King & Spalding, LLP (Gilbert Bruce Kaplan and Cris R. Revaz)
for Defendant-Intervenor Micron Technology, Inc.

Collier, Shannon, Scott, PLLC (Kathleen W. Cannon) for
Defendant-Intervenor Infineon Technologies North America Corp.
Court No. 03-00651 Page 2

Goldberg, Senior Judge: In this action, Plaintiffs Hynix

Semiconductor Inc. and Hynix Semiconductor America Inc.

(together, “Hynix”) challenge the final affirmative

determination of the United States Department of Commerce

(“Commerce”) in the countervailing duty proceedings involving

dynamic random access memory semiconductors (“DRAMS”) from the

Republic of Korea (“Korea”). See Dynamic Random Access Memory

Semiconductors from the Republic of Korea, 68 Fed. Reg. 37122

(Dep’t Commerce June 23, 2003) (final determination), as amended

by 68 Fed. Reg. 44290 (Dep’t Commerce July 28, 2003) (amended

final determination) (together, the “Final Determination”); see

also Dynamic Random Access Memory Semiconductors from the

Republic of Korea, 68 Fed. Reg. 47546 (Dep’t Commerce Aug. 11,

2003) (notice of countervailing duty order).1 Pursuant to USCIT

Rule 56.2, Hynix moves for judgment on the agency record. The

Court has jurisdiction pursuant to 28 U.S.C. § 1581(c).

1
The Final Determination was also challenged by the Korean
government before the World Trade Organization (the “WTO”). See
WTO Dispute Settlement Proceeding Regarding Countervailing Duty
Investigation on Dynamic Random Access Memory Semiconductors
(DRAMS) from Korea, 69 Fed. Reg. 34413 (USTR June 21, 2004)
(notice and request for comment) (providing notice of Korean
government request to establish WTO dispute settlement panel
concerning DRAMS countervailing duty investigation). The result
of these WTO proceedings has no bearing on the Court’s review of
Commerce’s regulations and practices at issue in this case. See
19 U.S.C. § 3533(g) (1999) (describing statutory scheme which
must be observed in order to change otherwise valid agency
policy to conform to WTO ruling).
Court No. 03-00651 Page 3

I. BACKGROUND

A. Precipitating Events

Hynix is a Korean DRAMS producer with a history of poor

financial performance dating from the late 1990s. See Appendix

to Defendant’s Memorandum in Opposition to Plaintiffs’ Motion

for Judgment on the Administrative Record (“Def.’s App.”), App.

4 (Memorandum from Deputy Assistant Secretary to Assistant

Secretary dated March 31, 2003) at 3-5 (analyzing Hynix’s

financial records from 1997 to 2002). In response to its

deteriorating performance, Hynix underwent financial

restructuring from approximately December 2000 to October 2001.

Defendant’s Memorandum in Opposition to Plaintiffs’ Motion for

Judgment on the Agency Record (“Def.’s Br.”) at 8-9. During

this ten-month period, four events formed the major part of the

restructuring: (1) execution of a ten-bank syndicated loan to

Hynix (December 2000); (2) enrollment of Hynix in the Korean

government’s ‘Fast Track’ program which allowed repackaging and

refinancing of rapidly maturing bonds (January 2001); (3)

execution of a seventeen-bank debt restructuring package in

favor of Hynix contingent on a successful international equity

offering by Hynix (May 2001); and (4) execution of a seventeen-

bank debt and debt-to-equity restructuring package in favor of

Hynix (October 2001). Id. at 8-12; Plaintiffs’ Memorandum In

Support of Its Rule 56.2 Motion for Judgment on the Agency
Court No. 03-00651 Page 4

Record (“Pls.’ Br.”) at 11-13. These events necessarily

involved the participation of Hynix’s multiple creditors, which

formed a creditors council including at least seventeen

specialized government entities, majority government-owned

financial institutions, and private financial institutions.

Def.’s Br. at 10; Pls.’ Br. at 11-13. Among these creditors was

Citibank, a non-Korean financial institution. Def.’s Br. at 12.

Together with its affiliate Solomon Smith Barney (“SSB”),

Citibank also served as a paid financial adviser to Hynix during

its restructuring. Id. at 6.

B. Commerce’s Investigation

On November 1, 2002, Defendant-Intervenor Micron

Technology, Inc. (“Micron”), a domestic DRAMS producer, filed a

petition with Commerce and the United States International Trade

Commission (the “ITC”) alleging that Hynix2 had received

financial assistance from the Korean government during its

restructuring which had resulted in an adverse impact on the

2
Because the petition generally alleged that Korean
manufacturers, producers, or exporters of DRAMS were receiving
countervailable subsidies, Commerce’s investigation also
included Samsung Electronics Industries Co., Ltd. (“Samsung”),
another major Korean DRAMS producer/exporter. Ultimately
finding that Samsung received de minimis subsidies, Commerce
made a negative countervailing duty determination as to Samsung.
Final Determination at 37124. Commerce’s conclusions related to
Samsung are not at issue in this case and Samsung is therefore
not discussed.
Court No. 03-00651 Page 5

DRAMS industry in the United States (the “U.S.”). Def.’s Br. at

3. Commerce initiated a countervailing duty investigation

shortly thereafter. Random Access Memory Semiconductors from

the Republic of Korea, 67 Fed. Reg. 70927 (Dep’t Commerce Nov.

27, 2002) (initiation of countervailing duty investigation). In

connection with the preliminary phase of the investigation,

Commerce issued questionnaires to the Korean government and

Hynix and received responses and comments. Def.’s Br. at 3-4.

On April 7, 2003, Commerce issued an affirmative preliminary

countervailing duty determination. Dynamic Random Access Memory

Semiconductors from the Republic of Korea, 68 Fed. Reg. 16766

(Dep’t Commerce Apr. 7, 2003) (preliminary determination).

Commerce then commenced its final countervailing duty

investigation, which included additional questionnaires and a

two-week visit to Korea to conduct on-site verification of

questionnaire responses. Def.’s Br. at 4. While in Korea,

Commerce met with Hynix employees, Korean government officials,

several of Hynix’s creditors, and a number of unnamed Korean

financial experts. Pls.’ Br. at 2-3. Following verification,

Commerce received case and rebuttal briefs from all parties and

held a hearing on June 6, 2003. Def.’s Br. at 4-5.

C. Commerce’s Final Determination

As a result of its investigation, on June 23, 2003,

Commerce issued the Final Determination and a supplemental
Court No. 03-00651 Page 6

decision memorandum incorporated therein. See Issues and

Decision Memorandum for the Final Determination in the

Countervailing Duty Investigation of Dynamic Random Access

Memory Semiconductors from the Republic of Korea, Inv. No. C-

580-851, (Dep’t Commerce June 16, 2003), available at

http://ia.ita.doc.gov/frn/summary/korea-south/03-15793-1.pdf

(“Decision Memo”). In its Final Determination, Commerce

concluded that Hynix had been the recipient of substantial

indirect subsidies during its ten-month restructuring, which

Commerce viewed to be a clandestine subsidy program orchestrated

by the Korean government. Decision Memo at 20-21. According to

Commerce, these subsidies came about when the Korean government

caused or coerced financial institutions to participate in

Hynix’s restructuring by making preferential loans and debt-to-

equity swaps. Id.

To reach this conclusion, Commerce invoked its authority to

countervail benefit-conferring financial contributions made by

private parties pursuant to government direction, as described

in 19 U.S.C. § 1677(5)(B)(iii).3 Id. at 21. Commerce

3
This statute provides, in pertinent part:
A subsidy is described in this paragraph in the case
in which an authority . . .
(iii) makes a payment to a funding mechanism to
provide a financial contribution, or entrusts or
directs a private entity to make a financial

(footnote continued)
Court No. 03-00651 Page 7

interpreted this statute to mean that, “if a government

affirmatively causes or gives responsibility to a private entity

or group of private entities to carry out what might otherwise

be a governmental subsidy function[,]” a financial contribution

would exist which, if benefit-conferring, would constitute a

countervailable subsidy. Id. at 47.

To determine if Hynix’s restructuring involved financial

contributions of the type described in 19 U.S.C. §

1677(5)(B)(iii), Commerce employed a two-part methodology: (1)

Commerce examined “whether the [Korean government] had in place

during the relevant period a governmental policy to support

Hynix” and (2) Commerce considered “whether evidence on the

record establishe[d] a pattern of practices on the part of the

[Korean government] to act upon that policy to entrust or direct

lending decisions” as part of Hynix’s restructuring. Id. at 49

(emphasis added). On the basis of the evidence derived from

this methodology, Commerce found that substantial evidence

supported the conclusion that, with the exception of Citibank,

Hynix’s creditors were subject to a program of government

contribution, if providing the contribution would
normally be vested in the government and the
practice does not differ in substance from
practices normally followed by governments,
to a person and a benefit is thereby conferred.
19 U.S.C. § 1677(5)(B) (1999) (emphasis added).
Court No. 03-00651 Page 8

direction during Hynix’s restructuring and, as a result of this

direction, had made financial contributions to Hynix. Id. at

49. Emphasizing a ten-month subsidy “program” theory, Commerce

found that “the [Korean government’s] role was essential at each

stage in directly supporting the restructuring process through

its own actions and by directing, facilitating, and guiding the

actions taken by creditor banks.” Id. at 49. Accordingly,

Commerce concluded that the Korean government had entrusted or

directed Hynix’s creditors to provide Hynix with loans and debt-

to-equity swaps which constituted potentially countervailable

financial contributions. Id. at 62. Further, Commerce

concluded that by providing these financial contributions,

Hynix’s creditors had effectively performed a “governmental

subsidy function[.]” Id. at 47.

Commerce next considered whether these financial

contributions had conferred a benefit to Hynix, thus rendering

them countervailable under 19 U.S.C. § 1677(5)(B)(iii). Id. at

6-11, 90-92. To make this determination, Commerce attempted to

compare the financial contributions under investigation to

commercial benchmarks, i.e., similar loans or equity infusions

made by independent actors to Hynix under market conditions.

Id. However, Commerce determined that no commercial benchmarks

were available, eliminating from consideration loans and equity

infusions made by the independent Citibank because of its
Court No. 03-00651 Page 9

involvement in Hynix’s restructuring and the financial

contributions under investigation. Id. Accordingly, Commerce

analyzed Hynix to determine if the company was otherwise

creditworthy or equityworthy during its restructuring, despite

the lack of commercial benchmarks to this effect. Id. at 11,

91-92. Commerce determined that Hynix was neither. Id. As a

result, Commerce concluded that Hynix would not have been able

to attract loans or equity investment from reasonable commercial

sources during its restructuring and, therefore, the financial

contributions which Hynix received from its government-directed

creditors conferred a countervailable benefit. Id.

II. STANDARD OF REVIEW

The Court must sustain the Final Determination unless it is

“unsupported by substantial evidence on the record, or otherwise

not in accordance with law.” 19 U.S.C. § 1516a(b)(1)(B)(i)

(1999).

Concerning the substantial evidence requirement, the U.S.

Supreme Court has defined this term to mean “such relevant

evidence as a reasonable mind might accept as adequate to

support a conclusion” taking into account the record as a whole.

Pierce v. Underwood, 487 U.S. 552, 565 (1988) (quoting Consol.

Edison Co. v. NLRB, 305 U.S. 197, 229 (1938)). It “requires

more than a mere scintilla” but is satisfied by “something less

than the weight of the evidence. . . .” Luoyang Bearing Factory
Court No. 03-00651 Page 10

v. United States, 27 CIT ___, ___, 288 F. Supp. 2d 1369, 1370

(2003) (citations omitted). In conducting its review, it is

insufficient for the Court to find “that the evidence supporting

[Commerce’s] decision is substantial when considered by itself.

The substantiality of evidence must take into account whatever

in the record fairly detracts from its weight.” Suramerica de

Aleaciones Laminadas, C.A. v. United States, 17 CIT 146, 149,

818 F. Supp. 348, 353 (1993) (citation omitted). However, the

Court “may not reweigh the evidence or substitute its own

judgment for that of [Commerce].” Acciai Speciali Terni S.p.A.

v. United States, 28 CIT ___, ___ n.14, 350 F. Supp. 2d 1254,

1267 n.14 (2004) (citation omitted). Instead, the Court’s

function is to ascertain “whether there is evidence which could

reasonably lead to [Commerce]’s conclusion.” PPG Indus. v.

United States, 978 F.2d 1232, 1237 (Fed. Cir. 1992) (citations

omitted). “[T]he possibility of drawing two inconsistent

conclusions from the evidence does not prevent an administrative

agency’s finding from being supported by substantial evidence.”

Id. (citations omitted).

Concerning the accordance with law requirement, the Court

applies two-part Chevron analysis to its review of Commerce’s

statutory interpretations in the context of a countervailing

duty determination. Allegheny Ludlum Corp. v. United States,

367 F.3d 1339, 1343 (Fed. Cir. 2004) (citing Chevron, U.S.A.,
Court No. 03-00651 Page 11

Inc. v. NRDC, 467 U.S. 837 (1984)). First, the Court determines

“whether Congress has directly spoken to the precise question at

issue. If the intent of Congress is clear, that is the end of

the matter; for the [C]ourt, as well as the agency, must give

effect to the unambiguously expressed intent of Congress.”

Chevron, 467 U.S. at 842. “If the statute is silent or

ambiguous with respect to the specific issue,” however, the

Court second considers “whether the agency’s answer is based on

a permissible construction of the statute.” Id. at 843. If so,

the Court must defer to the agency’s reasonable statutory

interpretation. Id. at 844.

Further, “[t]he deference granted to the agency’s

interpretation of the statutes it administers extends to the

methodology it applies to fulfill its statutory mandate.” GMN

Georg Muller Nurnberg AG v. United States, 15 CIT 174, 178, 763

F. Supp. 607, 611 (1991) (citing Chevron, 467 U.S. at 844-45;

Amer. Lamb Co. v. United States, 785 F.2d 994, 1001 (Fed. Cir.

1986); Melamine Chems., Inc. v. United States, 732 F.2d 924, 928

(Fed. Cir. 1984); Ceramica Regiomontana, S.A. v. United States,

10 CIT 399, 404, 636 F. Supp. 961, 966 (1986), aff’d, 810 F.2d

1137 (Fed. Cir. 1987)).
Court No. 03-00651 Page 12

III. DISCUSSION

A. Summary of Analysis

This case involves an alleged program of indirect subsidies

of the type described in 19 U.S.C. § 1677(5)(B)(iii). That

section of the countervailing duty statute4 sets forth a three-

prong test to prove the existence of a countervailable subsidy:

Commerce must prove 1) the making of a financial contribution by

a private entity to another private entity pursuant to

government entrustment or direction, 2) the exercise of a

government subsidy function in the provision of that financial

contribution, and 3) the existence of a benefit from that

financial contribution to its recipient. The proper

interpretation and application of the ‘entrusts or directs’

language of 19 U.S.C. § 1677(5)(B)(iii) – which establishes the

existence of a financial contribution5 - is the central issue in

this case and a matter of first impression for the Court.

4
References to the countervailing duty statute are to the Tariff
Act of 1930, as amended by, inter alia, the Uruguay Round
Agreements Act, 19 U.S.C. §§ 1671 et seq.
5
It is uncontested that, if proven to be entrusted or directed
by the Korean government, the loans and debt-to-equity swaps
made by Hynix’s creditors would constitute financial
contributions for purposes of 19 U.S.C. § 1677(5)(B)(iii). See
19 U.S.C. § 1677(5)(D) (1999) (defining “financial contribution”
to include “the direct transfer of funds, such as grants, loans,
and equity infusions, or the potential direct transfer of funds
or liabilities, such as loan guarantees”).
Court No. 03-00651 Page 13

For the reasons that follow, the Court concludes that

Commerce’s interpretation of the ‘entrusts or directs’ language

in this case is in accordance with law. Congressional intent,

Commerce’s past practice, and this Court’s jurisprudence clearly

support Commerce’s decision to interpret the ‘entrusts or

directs’ language broadly so as to include a single program of

financial contributions involving multiple financial

institutions directed by a foreign government. Under 19 U.S.C.

§ 1677(5)(B)(iii), Commerce may lawfully analyze countervailable

financial contributions on a program basis rather than engage in

a micro-analysis of each transaction making up the alleged

program. Further, Commerce’s chosen methodology for proving

such a program is sound. While a finding by Commerce of a

program of entrusted or directed financial contributions must be

supported by substantial evidence, 19 U.S.C. § 1677(5)(B)(iii)

does not require Commerce to produce conclusive evidence of

entrustment or direction of each entity involved in each

transaction making up an alleged program. Rather, Commerce may

lawfully support a finding of entrustment or direction with

direct and circumstantial evidence drawn from across the alleged

program (but not necessarily including conclusive evidence for

each party or each transaction in the alleged program), so long

as the cumulated evidence and the reasonable inferences drawn

therefrom sufficiently connect all the implicated parties and
Court No. 03-00651 Page 14

transactions to the alleged program of government entrustment or

direction.

Nonetheless, the Court is compelled to remand the Final

Determination because of errors in Commerce’s application of its

methodology in this case. While Commerce may allege a program

of government entrustment or direction under 19 U.S.C. §

1677(5)(B)(iii), Commerce must consider counterevidence

indicating that the transactions making up that alleged program

were formulated by an independent commercial actor (not a

government) and motivated by commercial considerations. Here,

Commerce neglected to explain the influential role of

Citibank/SSB and the aberrational presence of commercial

contingencies in Hynix’s restructuring as part of its financial

contribution analysis. These serious errors require remand of

the portion of the Final Determination concerning Commerce’s

financial contribution analysis for further consideration and

explanation before the Court may undertake its substantial

evidence review. Because the Court is remanding on the

threshold issue of the existence of potentially countervailable

financial contributions, the Court does not yet reach the

parties’ arguments concerning other aspects of the Final

Determination (i.e., Commerce’s governmental subsidy function

analysis and benefit analysis). The Court’s conclusions are

discussed more fully below.
Court No. 03-00651 Page 15

B. Commerce’s Statutory Interpretation and Methodology Are In
Accordance with Law

As an initial matter, Hynix generally objects to Commerce’s

decision to frame the parties and transactions at issue in this

case as participating in a single “program” of entrustment or

direction. Pls.’ Br. at 16. Hynix contends that this

generalized program theory and associated evidentiary approach

obscure the more specific inquiry required by the ‘entrusts or

directs’ language of 19 U.S.C. § 1677(5)(B)(iii) and is contrary

to law. Id. at 15-17; Plaintiffs’ Reply to Defendant’s and

Defendant-Intervenor’s Memorandum In Opposition to Plaintiffs’

Rule 56.2 Motion for Judgment on the Agency Record (“Pls.’

Reply”) at 1-5, 7.

The Court understands Hynix’s objection to include two

separate arguments: (1) an appropriate interpretation of the

statutory language does not permit Commerce to pursue a program

theory of entrusted or directed financial contributions and (2)

regardless of whether a program theory is permissible,

Commerce’s methodology must include an analysis of each

investigated party and transaction separately and produce

evidence of entrustment or direction on that basis. For the

reasons that follow, the Court rejects Hynix’s arguments and

upholds both Commerce’s statutory interpretation and

methodology.
Court No. 03-00651 Page 16

1. Commerce’s Statutory Interpretation of the ‘Entrusts
or Directs’ Language To Include a Single Program of
Government-Directed Financial Contributions Involving
Multiple Financial Institutions and Multiple
Transactions Is In Accordance with Law

Hynix argues that Commerce erred by framing each

transaction made by each financial institution at issue as a

single government-directed program of financial contributions.

Pls.’ Br. at 16. Instead, Hynix contends that 19 U.S.C. §

1677(5)(B)(iii) establishes a standard whereby Commerce must

separately analyze each alleged financial contribution. Id.

The Court finds that, under Chevron analysis, Commerce’s

decision to interpret the ‘entrusts or directs’ language to

include a multi-stage, multi-actor program of financial

contributions is reasonable. As an initial matter, the Court

notes that the countervailing duty statute does not define

‘entrusts or directs’ or provide examples of practices,

transactions, or events that would constitute an entrusted or

directed financial contribution. Turning to the relevant

legislative history, Congress expressly acknowledged that this

phrase would be subject to interpretation. The Uruguay Round

Agreements Act Statement of Administrative Action (the “SAA”)6

states:

6
Congress has mandated that the SAA “shall be regarded as an
authoritative expression by the United States concerning the

(footnote continued)
Court No. 03-00651 Page 17

[T]he term ‘financial contribution’ includes
situations where the government entrusts or directs a
private body to provide the subsidy. (It is the
Administration's view that the term ‘private body’ is
not necessarily limited to a single entity, but can
include a group of entities or persons.) . . . . [T]he
Administration intends that the ‘entrusts or directs’
standard shall be interpreted broadly. The
Administration plans to continue its policy of not
permitting the indirect provision of a subsidy to
become a loophole when unfairly traded imports enter
the United States and injure a U.S. industry . . . .
. . . .
In cases where the government acts through a
private party . . . the Administration intends that
the law continue to be administered on a case-by-case
basis . . . .

SAA, H.R. Doc. No. 103-465, at 925-26 (1994), as reprinted in

1994 U.S.C.C.A.N. 4040, 4239-40, 1994 WL 761793. In light of

the SAA, the Court finds that the ‘entrusts or directs’ language

presents precisely the type of ambiguity which an administrative

agency, like Commerce, is given deference under Chevron step one

to reasonably interpret. See Floral Trade Council v. United

States, 23 CIT 20, 24, 41 F. Supp. 2d 319, 324 (1999) (noting

that Court will defer to Commerce’s reasonable interpretation

under Chevron where Congress's intended definition of a term is

not ascertainable through statutory construction).

interpretation and application of the Uruguay Round Agreements
and [the Uruguay Round Agreements Act] in any judicial
proceeding in which a question arises concerning such
interpretation or application.” 19 U.S.C. § 3512(d) (1999).
Court No. 03-00651 Page 18

Proceeding to Chevron step two, the Court first notes that,

in conformity with the SAA, Commerce has committed itself to

interpreting the ‘entrusts or directs’ language on a case-by-

case basis. Commerce eschewed the opportunity to articulate a

fixed definition of this phrase when it promulgated its

countervailing duty regulations after the passage of the Uruguay

Round Agreements Act. See Countervailing Duties, 63 Fed. Reg.

65348, 65349 (Dep’t Commerce Nov. 25, 1998) (final rule)

(explaining that the phrase “could encompass a broad range of

meanings” and indicating that it would not be “appropriate to

develop a precise definition of the phrase for purposes of these

regulations”). When interpreting the phrase in this case,

Commerce alleged that entrusted or directed financial

contributions could manifest as a series of loans and equity

infusions made by multiple financial institutions pursuant to a

single government program of direction. In its Decision Memo,

Commerce explained why it considered this programmatic

formulation to be more appropriate than analyzing each

constituent element of the alleged program:

It is clear from the [statutory language] defining
“subsidy” that a subsidy is a program by a government
or directed by a government. There is no sense in the
statute that individual events of a subsidy program
need to be evaluated outside of the overall context of
the subsidy program. Rather, a subsidy program can
include multiple elements and multiple actors, brought
together for an overarching governmental objective.
Court No. 03-00651 Page 19

Decision Memo at 48 n.11.7

The question for the Court is whether this interpretation

of the statute is based upon a “permissible” construction.

Chevron, 467 U.S. at 843. The Court concludes that it is.

Through the SAA, Congress has directed Commerce to interpret the

countervailing duty statute broadly so as to close any loopholes

which might enable governments to provide indirect subsidies.

As noted by Congress, the specific manner in which governments

have acted through private entities to provide subsidies has

varied widely in the past. SAA, H.R. Doc. No. 103-465, at 926,

1994 U.S.C.C.A.N. at 4239. This creativity can be expected to

continue. It is possible that governments increasingly

sophisticated in countervailing duty law may choose to obscure

their actions by pursuing complex, multi-stage subsidy programs.

7
Further, Commerce’s use of a programmatic approach is
consistent with its administration of other aspects of the
countervailing duty statute. For example, in Live Swine from
Canada, Commerce explained that:
Neither the countervailing duty statute nor
regulations mandate a specific standard to be used
when determining whether a program under review should
be treated as a single program or several programs.
Under these circumstances, the Department has
discretion and must base its determination on a
reasonable interpretation of the facts on the record.
Live Swine from Canada, 61 Fed. Reg. 52408, 52412 (Dep’t
Commerce Oct. 7, 1996) (final results of administrative review).
See also Structural Steel Beams From the Republic of Korea, 65
Fed. Reg. 41051 (Dep’t Commerce July 3, 2000) (final
determination) (assessing different types of loans together).
Court No. 03-00651 Page 20

If so, such programs may very well be best analyzed as a whole,

rather than reviewed on a constituent basis. Cf. United States

v. Patten, 226 U.S. 525, 544 (1913) (noting that “the character

and effect of a conspiracy is not to be judged by dismembering

it and viewing its separate parts, but only by looking at it as

a whole”) (citations omitted). Loopholes would be opened – and

the countervailing duty statute narrowed - if the ‘entrusts or

directs’ language were read to require Commerce to separately

analyze each element of an alleged program like the one at

issue. Where (as here) the same company, the same financial

institutions, and the same governmental authorities are all

allegedly involved in the pursuit of the same general goal over

a period as short as ten months, it is reasonable for Commerce

to view individual transactions by these entities as one large

program and attempt to build a countervailing duty case on that

basis. Adopting the restrictive interpretation advocated by

Hynix would flaunt Congress’ desire for a broad interpretation

and significantly limit Commerce’s valuable case-by-case

discretion.

In addition, Commerce’s interpretation conforms with its

past practice in the context of indirect subsidies, as this term

was used in an earlier version of the countervailing duty
Court No. 03-00651 Page 21

statute.8 In AK Steel v. United States, 192 F.3d 1367 (Fed. Cir.

1999), aff’g in part, rev’g in part British Steel P.L.C. v.

United States, 20 CIT 1141, 941 F. Supp. 119 (1996), the U.S.

Court of Appeals for the Federal Circuit (the “Federal Circuit”)

reviewed this Court’s consideration of an alleged indirect

subsidy program by the Korean government to provide its domestic

steel industry with preferential access to medium- and long-term

credit from government and commercial financial institutions.

AK Steel, 192 F.3d at 1369. In the determination at issue in AK

Steel, Commerce found that the Korean government’s control of

lending institutions constituted a program which resulted in

preferential access to loans by the Korean steel industry and

the receipt of countervailable benefits. Id. at 1372-73.

Neither this Court, nor the Federal Circuit on appeal, required

Commerce to compartmentalize or separately consider each loan

8
Although the Uruguay Round Agreements Act first introduced the
‘entrusts or directs’ language into the countervailing duty
statute, the concept of indirect subsidies is not new. See 19
U.S.C. § 1671(a) (1988) (authorizing imposition of duty where “a
country . . . is providing, directly or indirectly, a subsidy”)
(emphasis added). According to the SAA, “[i]t is the
Administration's view that [the ‘entrusts or directs’ language]
encompass[es] indirect subsidy practices like those which
Commerce has countervailed in the past, and that these types of
indirect subsidies will continue to be countervailable . . . .”
SAA, H.R. Doc. No. 103-465, at 926, 1994 U.S.C.C.A.N. at 4239-40
(citing, inter alia, Certain Softwood Lumber Products from
Canada, 57 Fed. Reg. 22570 (Dep’t Commerce May 28, 1992) (final
determination); Leather from Argentina, 55 Fed. Reg. 40212 (Oct.
2, 1990) (final determination and duty order).
Court No. 03-00651 Page 22

provided by each financial institution to each steel producer

within the alleged program. Instead, as here, both courts

implicitly accepted Commerce’s indirect subsidy program theory

and reviewed Commerce’s determination on that basis. E.g., id.

at 1374-75.

Accordingly, the Court upholds Commerce’s reasonable

interpretation of the ‘entrusts or directs’ language of 19

U.S.C. § 1677(5)(B)(iii). See Serampore Indus. Pvt., Ltd. v.

U.S. Dep't of Commerce, Int’l Trade Admin., 11 CIT 866, 873, 675

F. Supp. 1354, 1360 (1987) (upholding Commerce’s interpretation

of term used in countervailing duty statute where supported by

legislative history and sufficiently reasonable).

2. Commerce’s Methodology for Proving the Existence of a
Program of Government-Entrusted or Directed Financial
Contributions Is In Accordance with Law

Even if Commerce is statutorily permitted to allege

entrustment or direction on a program basis, Hynix notes that

Commerce must utilize a permissible methodology to prove the

existence of such a program. Pls.’ Br. at 7. Hynix argues that

Commerce employed a faulty, “results-oriented” methodology to

prove the alleged program of entrusted or directed financial

contributions in this case. Id. Hynix objects to Commerce’s

decision to prove the existence of the alleged program by

presenting ‘government policy’ and ‘pattern of practices’

evidence drawn from across the alleged program but not including
Court No. 03-00651 Page 23

specific evidence of entrustment or direction of each party or

each transaction in the alleged program. Id. at 6. Where an

alleged program involves multiple private entities and

transactions, Hynix contends that Commerce must provide “a

showing of actual and specific entrustment or direction” of each

private entity for each transaction. Id. at 16. Without this

detailed “bank-by-bank” or “event-by-event” inquiry, Hynix

contends that Commerce’s more generalized ‘government policy’

and ‘pattern of practices’ methodology enabled Commerce to “blur

the details and to bootstrap its alleged evidence across the

lengthy period investigated, and across the numerous banks

considered.”9 Id. at 15.

The Court concludes that Commerce’s methodology for proving

the alleged government-directed program of financial

contributions involving multiple financial institutions and

multiple transactions was reasonable. Central to the Court’s

holding is its understanding of Commerce’s methodology in light

9
The Court recognizes that Hynix’s arguments concerning
Commerce’s methodology are nearly identical to its arguments
concerning Commerce’s statutory interpretation. The Court has
chosen to address them separately to make clear Commerce’s
authority under the countervailing duty statute and Commerce’s
evidentiary obligations with regard to its chosen methodology.
Further, although equal deference is owed to Commerce’s
statutory interpretation and choice of implementing methodology,
see Chevron, 467 U.S. at 844-45, the Court’s review of these
agency actions requires two distinct inquiries.
Court No. 03-00651 Page 24

of the evidentiary challenges posed by 19 U.S.C. §

1677(5)(B)(iii). This statute empowers Commerce to countervail

benefit-conferring financial contributions made by private

parties pursuant to government entrustment or direction –

financial contributions which, by their furtive nature, are

likely to be difficult to discern and even harder to prove by

the requisite substantial evidence. Such evidence may be direct

or circumstantial; indeed, given the nature of these financial

contributions, it is probable that Commerce will rely heavily on

circumstantial evidence to meet the substantial evidence

standard in many cases. In appropriate circumstances, Commerce

may permissibly use circumstantial evidence to prove, in whole

or in part, the existence of entrusted or directed financial

contributions under 19 U.S.C. § 1677(5)(B)(iii). See AK Steel,

192 F.3d at 1373-76 (discussing use of circumstantial evidence

in indirect subsidy context); cf. Michalic v. Cleveland Tankers,

Inc., 364 U.S. 325, 330 (1960) (finding that, for purposes of

establishing jury question, “[c]ircumstantial evidence is not

only sufficient, but may also be more certain, satisfying and

persuasive than direct evidence”) (citation and footnote

omitted).

Of course, Commerce must fairly weigh each piece of

circumstantial evidence it invokes in support of a finding of

government entrustment or direction. See Fuji Photo Film Co. v.
Court No. 03-00651 Page 25

Jazz Photo Corp., 394 F.3d 1368, 1374 (Fed. Cir. 2005) (noting

that, in trial context, fact finder “has the responsibility to

weigh the [circumstantial] evidence . . . in deciding the

inferential reach of such circumstantial evidence”) (citation

omitted). Circumstantial evidence is subject to inference, but

not every piece of circumstantial evidence will support an

inference of government entrustment or direction. However, when

viewed together, several such inferences, drawn from multiple

sources of corroborating evidence, could support a finding of

entrustment or direction. Cf. Akron Polymer Container Corp. v.

Exxel Container, 148 F.3d 1380, 1384 (Fed. Cir. 1998) (noting

that, in patent context, an offense involving deception is “in

the main proven by inferences drawn from facts, with the

collection of inferences permitting a confident judgment that

deceit has occurred”). This is particularly true when direct

evidence further supports these inferences.

This reasoning applies with equal force to proving a single

entrusted or directed financial contribution or an entire

program of such financial contributions. Cf. Theatre Enter.,

Inc. v. Paramount Film Distrib. Corp., 346 U.S. 537, 541-42

(1954) (finding that, in antitrust context, conspiracy may be

inferred from evidence of parallel behavior when combined with

inferences from other facts and circumstances). Under certain

circumstances, record evidence and the inferences drawn
Court No. 03-00651 Page 26

therefrom could very well indicate that a foreign government is

pursuing an elaborate program of subsidization, rather than a

one-off subsidy. Commerce need not support such a conclusion

with conclusive evidence incriminating every aspect of the

alleged program, for a reasonable person could be satisfied as

to the existence of the program with a lesser but highly

persuasive evidentiary showing. See Consol. Edison, 305 U.S. at

229 (finding that substantial evidence is “such relevant

evidence as a reasonable mind might accept as adequate to

support a conclusion”). This lesser evidentiary showing would

likely rely on inferential connections between the various

parties and transactions comprising the alleged program. So

long as these inferences were reasonable, even Commerce’s lesser

evidentiary showing could permit a confident judgment that a

clandestine program of entrusted or directed financial

contributions had been carried out.

Commerce’s methodology appears to be grounded in this sound

reasoning. While the evidentiary support for Commerce’s

determination consisted of some direct evidence, the vast

majority of evidence was circumstantial. Commerce chose to

present this evidence in two parts. First, Commerce sought to

prove that the Korean government had a ‘governmental policy’ to

subsidize Hynix by introducing evidence indicating that the

Korean government had a motive to subsidize. Second, Commerce
Court No. 03-00651 Page 27

attempted to identify a ‘pattern of practices’ showing that the

Korean government acted on this motive as part of a program to

manipulate private entities.10 The practices identified by

Commerce varied but it appears to the Court that they may

broadly be categorized as including evidence of: (1) the Korean

government’s propensity to subsidize companies like Hynix; (2)

the Korean government’s proclivity for influencing or coercing

the actions of financial institutions to achieve its policy

goals; (3) the Korean government’s opportunity or capacity to

specifically influence or coerce the financial institutions

involved in Hynix’s restructuring; and (4) direct commands by

the Korean government to some of these institutions. With the

exception of this last category (which relies on direct

evidence), proof of motive, propensity, proclivity, opportunity,

and capacity is derived by inference from circumstantial

evidence. Individually, each of these inferences would be

insufficient to establish the existence of a program of

10
This ‘pattern of practices’ inquiry appears to be similar to
the “causal nexus” between government action and benefits
allegedly bestowed by private entities which Commerce was
required to establish in order to prove an indirect subsidy
under the previous version of the countervailing duty statute.
See AK Steel, 192 F.3d at 1376.
Court No. 03-00651 Page 28

entrustment or direction;11 but, together, this collection of

inferences could permit such a conclusion under 19 U.S.C. §

1677(5)(B)(iii), particularly when buttressed by corroborating

direct evidence. As such, the Court finds Commerce’s

methodology to be reasonable.

This conclusion by the Court is once again supported by the

Federal Circuit’s reasoning in AK Steel. As here, the AK Steel

court did not require Commerce to provide, as a matter of law,

conclusive evidence implicating each party and each step in the

alleged program of indirect subsidies. Rather, the Federal

Circuit accepted Commerce’s more generalized methodology, which

relied heavily on inferences drawn from circumstantial evidence

to connect the various elements of the alleged indirect subsidy

program. AK Steel, 192 F.3d at 1374-75. However, the Federal

Circuit took issue with the substantiality of the evidence

proffered by Commerce within that approach. Id. Ultimately

reversing in part this Court’s decision to uphold Commerce’s

determination, the Federal Circuit held that Commerce had failed

to produce sufficient direct or circumstantial evidence to

11
This Court has also found that “evidence of motive and
opportunity alone” are insufficient to prove improper government
action under a different aspect of the countervailing duty
statute. Al Tech Specialty Steel Corp. v. United States, 28 CIT
___, ___, Slip Op. 04-114 at 19 (Sept. 8, 2004).
Court No. 03-00651 Page 29

support its finding of an indirect subsidy program by

substantial evidence. Id. at 1376.

In so holding, the Federal Circuit reinforced the common

sense principle that the quantum and quality of evidence

required to satisfy the substantial evidence standard varies

from case to case. Accord Astra Pharm. Prod., Inc. v.

Occupational Safety & Health Review Comm., 681 F.2d 69, 74 (1st

Cir. 1982) (noting that “what constitutes substantial evidence

varies with the circumstances”). More or richer evidence may be

required to support, by substantial evidence, allegations of a

complex, large-scale subsidy program encompassing multiple

commercial actors, multiple government authorities, multiple

phases, multiple transactions, multiple months, etc. Of course,

an affirmative countervailing duty determination supported by

evidence of the depth and breadth implicated by Hynix’s

suggested methodology would more easily pass this judicial

review.12 But, depending on its quality, scope, and degree of

incrimination, a lesser quantum of evidence (and the inferences

12
In the Court’s view, Hynix’s proposed methodology –
implicating every actor and every major decision involved in an
alleged complex subsidy program – would likely require Commerce
to produce evidence more closely approximating overwhelming
evidence. Such a showing would far exceed the requirements of
the substantial evidence standard in most cases. See Consolo v.
Fed. Mar. Comm’n, 383 U.S. 607, 620 (1996) (noting that
substantial evidence is “something less than the weight of the
evidence”) (citations omitted).
Court No. 03-00651 Page 30

drawn fairly therefrom) may also suffice to connect ostensibly

disparate parties and transactions to a single, interrelated

program of government entrustment or direction. When this

lesser quantum of evidence is sufficient may sometimes be a

difficult determination for the Court to make, but “[t]here are

no talismanic words that can avoid the process of judgment.”

Universal Camera Corp. v. NLRB, 340 U.S. 474, 489 (1951).

Accordingly, the Court declines to burden Commerce with the

unnecessarily stringent approach suggested by Hynix and upholds

Commerce’s reasonable methodology. See, e.g., Federal-Mogul

Corp. v. United States, 18 CIT 785, 807-08, 862 F. Supp. 384,

405 (1994) (noting that “[Commerce] is given discretion in its

choice of methodology as long as the chosen methodology is

reasonable”) (citation omitted); Coal. for the Pres. of Am.

Brake Drum & Rotor Aftermarket Mfrs. v. United States, 23 CIT

88, 113 n.40, 44 F. Supp. 2d 229, 252 n.40 (1999) (“The [Uruguay

Round Agreements Act] and SAA are silent as to how Commerce

should make a finding of knowledge of material injury.

Therefore, Commerce is afforded reasonable discretion in

formulating a methodology.”) (citation omitted).

C. Commerce’s Final Determination Requires Additional
Explanation Before the Court May Undertake Substantial
Evidence Review

Even if Commerce’s statutory interpretation and methodology

are legally permissible, Hynix argues that the facts of this
Court No. 03-00651 Page 31

case do not support Commerce’s program theory. Pls.’ Br. at 3.

Hynix contends that Commerce ignored key parts of the record

evidence and seriously distorted others in favor of its program

theory. Id. at 11-25. Hynix asserts that, when the

counterevidence is considered and the evidence invoked by

Commerce is viewed properly, Commerce lacked sufficient

evidentiary support for its finding of entrusted or directed

financial contributions, in violation of the substantial

evidence standard. Id. at 25-29.

The Court understands Hynix’s objection to include two

principal arguments: (1) Commerce failed to consider

counterevidence indicating that an independent third party (not

the Korean government) orchestrated Hynix’s restructuring, which

was motivated by commercial considerations and (2) the evidence

in support of Commerce’s theory was insufficient to establish a

program of entrustment or direction under the substantial

evidence standard. For the reasons that follow, the Court

remands the Final Determination to Commerce to more fully

address Hynix’s first argument and reserves judgment on Hynix’s

second argument until after remand.

1. Commerce Failed to Adequately Address Counterevidence
of Entrustment or Direction, Requiring Remand of the
Final Determination for Additional Explanation

Hynix argues that Commerce failed to address

counterevidence indicating that Hynix’s restructuring was in
Court No. 03-00651 Page 32

fact organized by independent Citibank/SSB and driven by

commercial considerations. Pls.’ Br. at 11-16. Hynix argues

that record evidence proves that three of the four major phases

of Hynix’s restructuring were actually orchestrated by

Citibank/SSB: (1) Citibank arranged a ten-bank syndicated loan

for Hynix in December 2000; (2) Citibank and SSB designed

Hynix’s May 2001 debt restructuring package, modeling it on an

informal Corporate Restructuring Agreement suggested by the

International Monetary Fund and making it conditional on a

successful international equity offering; and (3) SSB

orchestrated Hynix’s October 2001 debt restructuring package,

which provided creditors with multiple courses of action

including debt liquidation. Id. at 11-13. Since Citibank/SSB

arranged most aspects of Hynix’s restructuring and included

market-based contingencies with no guaranteed outcome, Hynix

contends that the ten-month subsidy program simply could not

have existed as alleged. Id. at 11. In Hynix’s view, Commerce

erred by failing to consider this alternative theory and

supporting evidence in the Final Determination. Id.

The Court finds that Commerce erred by failing to

adequately address, in its financial contribution analysis,

counterevidence indicating that Hynix’s restructuring was

organized by Citibank/SSB and conditioned on uncertain market

events. The portion of the Final Determination explaining
Court No. 03-00651 Page 33

Commerce’s finding of a program of entrusted or directed

financial contributions contains only three footnotes

referencing Citibank/SSB’s involvement. Decision Memo at 49

n.12, 57 n.24, 59 n.26. These somewhat disjointed footnotes do

not squarely address Hynix’s argument related to Citibank/SSB.

Rather, Commerce appears to have viewed this argument as an

impermissible request to conflate benefit analysis with

financial contribution analysis under the countervailing duty

statute. See id.; Def.’s Br. at 18, 32. Similarly, Commerce

dismissed Hynix’s related argument concerning the anomalous

presence of commercial contingencies in Hynix’s restructuring,

generally finding it unsurprising that the private parties in a

government-entrusted or directed program would be able to set

the commercial terms of their involvement. Decision Memo at 48,

61; Def.’s Br. at 18, 32.

Commerce misunderstands the true import of Hynix’s

arguments. Hynix has essentially advanced an alternative theory

of the case – one where an independent commercial actor (not the

Korean government) orchestrated the financial contributions

under investigation and made at least some of them contingent on

uncertain market events (e.g., the international equity

offering). If true, this alternative theory could reasonably

explain the concerted actions of Hynix’s creditors. This theory

could also perhaps better explain the complexity of Hynix’s
Court No. 03-00651 Page 34

restructuring, which featured commercial contingencies and

options whose uncertain outcome are indeed very surprising in

the context of alleged government control. Hynix has produced

evidence rendering this alternative theory at least colorable.

See, e.g., Pls.’ App., App. 1 (Hynix’s Questionnaire Response

dated Jan. 27, 2003); id., App. 10 (Hynix Supplemental

Questionnaire Response dated Mar. 4, 2003); id., App. 17

(Citibank Affidavit dated Mar. 20, 2003); id., App. 7 (Hynix’s

Verification Report dated May 15, 2003); id., App. 18 (Citibank

Affidavit dated May 22, 2003).

Failure to consider this alternative theory and supporting

evidence constituted clear error by Commerce. See 19 U.S.C. §

1677f(i)(3)(A) (1999) (obligating Commerce to consider relevant

arguments made by interested parties). Commerce may disagree

with Hynix’s alternative theory and disbelieve the evidence

supporting it, but Commerce must explain this decision. See,

e.g., Allegheny Ludlum Corp. v. United States, 29 CIT ___, ___,

358 F. Supp. 2d 1334, 1344 (2005) (noting that an “agency must

explain its rationale . . . such that a court may follow and

review its line of analysis, its reasonable assumptions, and

other relevant considerations”) (citation omitted); Granges

Metallverken AB v. United States, 13 CIT 471, 478, 716 F. Supp.

17, 24 (1989) (noting that “it is an abuse of discretion for an

agency to fail to consider an issue properly raised by the
Court No. 03-00651 Page 35

record evidence”) (citation omitted). Because Commerce failed

to provide this explanation as part of its financial

contribution analysis,13 the Court remands this issue to

Commerce.

On remand,14 Commerce must address Hynix's argument by

thoroughly explaining, if it is able: (1) why Commerce

disregarded or disbelieved the record evidence indicating that

Citibank/SSB – not the Korean government - orchestrated Hynix’s

restructuring; and (2) why Hynix’s restructuring featured

commercially-based contingencies and options with no guaranteed

13
The Court acknowledges that the Final Determination rightly
included a lengthy discussion of Citibank/SSB as part of
Commerce’s benefit analysis. See Decision Memo at 7-11, 90-92.
However, this discussion fails to meet the Court’s requirements.
First, to the extent that this discussion addressed some of the
evidence cited herein, it did so for the limited purpose of
determining whether Citibank’s involvement in Hynix’s
restructuring was covered by an implicit Korean government
guarantee. Id. at 8. At no point in this discussion did
Commerce address Hynix’s contention that Citibank organized the
activities of the other investigated financial institutions.
Further, this discussion did not address the uncertain nature of
the commercial contingencies featured in Hynix’s restructuring.
Finally, this discussion formed part of Commerce’s benefit
analysis, which necessarily assumed the very issue in dispute
(i.e., that the Korean government entrusted or directed the
investigated financial contributions).
14
With regard to the remand results, the Court admonishes
Commerce to refrain from making oblique references to record
evidence and instead assist the review process by providing
direct citations to documents within the voluminous
administrative record.
Court No. 03-00651 Page 36

outcome if Hynix’s restructuring was indeed the product of

government entrustment or direction and not market forces.

2. The Court Defers Consideration of Hynix’s Argument
that the Final Determination Lacked Sufficient
Evidentiary Support to Establish Entrustment or
Direction under the Substantial Evidence Standard

Finally, Hynix argues that Commerce mischaracterized and

exaggerated much of the record evidence supporting its subsidy

program theory. Pls.’ Br. at 6. To explain this position,

Hynix’s brief provides a lengthy discussion of the specific

pieces of evidence allegedly misinterpreted by Commerce. Id. at

11-25. In Hynix’s view, Commerce’s mistreatment of this

evidence allowed Commerce to impermissibly “blur a series of

separate financial transactions into one single restructuring,

even though there were sharp breaks between some transactions

and different banks made different decisions at each stage.”

Id. at 5. Hynix contends that a “serious analysis of the

underlying facts” reveals the evidentiary shortcomings of the

Final Determination and, thus, Commerce’s failure to satisfy the

substantial evidence standard. Pls.’ Reply at 5.

The Court finds that, while Hynix has raised fair questions

concerning Commerce’s interpretation of the record evidence,

these questions are best resolved after receipt of the ordered

remand results. In the Court’s view, the Citibank/SSB

counterargument is so critical to this case that it “has direct
Court No. 03-00651 Page 37

and material bearing on the proper resolution of the various

issues presented” concerning the substantiality of the evidence

supporting Commerce’s program theory. Usinor v. United States,

26 CIT 767, 784 (2002). Without a reasoned explanation of

Citibank/SSB’s role in Hynix’s restructuring and the alleged

financial contributions at issue, “the accuracy and legitimacy

of the [agency]'s findings and conclusions [are called] squarely

into question.” Id. Due to the importance of the Citibank/SSB

counterargument, the Court finds itself unable at this time to

engage in a substantive review of the evidence supporting

Commerce’s finding of government entrustment or direction. See

Fla. Power & Light Co. v. Lorion, 470 U.S. 729, 744 (1985)

(noting that “if the agency has not considered all relevant

factors, or if the reviewing court simply cannot evaluate the

challenged agency action on the basis of the record before it,

the proper course, except in rare circumstances, is to remand to

the agency for additional investigation or explanation”).

Accordingly, the Court reserves judgment on Hynix’s second

argument concerning the substantiality of evidence in support of

Commerce’s finding of entrusted or directed financial

contributions until after receipt of the remand results. See,

e.g., Luoyang Bearing Corp. v. United States, 28 CIT ___, ___,

347 F. Supp. 2d 1326, 1359 (2004) (declining to address party

argument until receipt of remand results on related issue);
Court No. 03-00651 Page 38

Chefline Corp. v. United States, 25 CIT 1129, 1130, 170 F. Supp.

2d 1320, 1324 (2001) (deferring review of portion of agency

determination until receipt of remand results on related issue).

IV. CONCLUSION

For the foregoing reasons, the Court remands the Final

Determination. Because the Court is remanding to Commerce for

further consideration of its threshold finding of potentially

countervailable financial contributions, the Court does not yet

reach the parties’ arguments concerning other aspects of the

Final Determination (i.e., Commerce’s governmental subsidy

function analysis and benefit analysis). A separate order will

be issued accordingly.

/s/ Richard W. Goldberg
Richard W. Goldberg
Senior Judge

Date: August 26, 2005
New York, New York