Washington, D.C. (WVDN) – Congresswoman Carol Miller (R-WV) along with U.S. Senators Shelley Moore Capito (R-WV) and Joe Manchin (I-WV) urged U.S. Secretary of Commerce Gina Raimondo to reverse a Commerce decision that threatens domestic manufacturers of chlorinated isocyanurates (isos), a cleaning chemical used often for swimming pools. In South Charleston, West Virginia, over 100 direct jobs at Solenis – one of the nations’ chlorinated iso producers – are at stake.
Click here for the full letter.
On Commerce’s decision to replace Mexico with Romania on calculating dumping margins:
Dear Secretary Raimondo:
We are writing to express our concern over a preliminary determination by the U.S. Department of Commerce (Commerce) that threatens the future of domestic manufacturers in our state and across the nation. Specifically, we request your direct oversight to reexamine the underlying analysis in preliminary decision 89 FR 56303 issued on July 9, 2024, which, left unchanged, would result in a dramatic reduction of antidumping (AD) duty rates on chlorinated isocyanurates (isos) from China. If finalized, the over 80% reduction of AD rates on unfairly dumped Chinese would jeopardize domestic manufacturing jobs in West Virginia, undermine U.S. trade remedy laws, and further weaken our nation’s ability to compete fairly against China’s use of unfair trade practices.
The current preliminary determination would reduce existing antidumping duty rates on chlorinated isos by over 80%. The proposed reduction stems from Commerce’s decision to use Romania as the surrogate country for calculating dumping margins, replacing Mexico, which has historically been used.
While Romania was included among the FY24 list of five countries deemed by Commerce as most appropriate surrogate economies for China, Mexico was not. However, the FY25 surrogate country list for China, published shortly after issuing this preliminary determination, on August 27, 2024, restored Mexico to the list and dropped Romania. Mexico is the correct and only appropriate choice for selection as the surrogate country.
Romania does not produce chlorinated isos, but rather bleach, a fundamentally different product. While both serve as chlorine-based disinfectants, their end-uses are quite different. Chlorinated isos are used for slow, continuous disinfection, and require exposure to water to activate (e.g., in swimming pools), whereas bleach is used for fast-acting, short-term disinfection (e.g., household cleaning) and is not dependent on exposure to another element for activation. Moreover, chlorinated isos are significantly more complex – requiring higher-educated (e.g. chemists) and other skilled personnel – and time-consuming to produce than bleach, making Romania an unsuitable surrogate. Finally, bleach does not include cyanuric acid, which is a key ingredient in chlorinated isos providing their stabilizing function. By contrast, Mexico produces identical and scalable production of chlorinated isos.
On the negative impact Commerce’s decision would have on the U.S. and West Virginians working at Solenis if approved:
Commerce also has a policy allowing for the selection of an off-list surrogate country in cases where no listed country produces comparable merchandise. Given that Romania is not a suitable comparator, Commerce has the discretion, precedent, and obligation to select Mexico.
The flawed selection of Romania as the surrogate country undermines the integrity of this determination and, if not modified prior to finalization, will have significant ramifications for U.S. manufacturers including in West Virginia. Reducing AD duty rates on chlorinated isos by 80% would allow Chinese producers to flood the U.S. market with their products, effectively pricing out domestic manufacturers.
In South Charleston, West Virginia, over 100 direct jobs at Solenis, one of the nations’ chlorinated iso producers, are at stake. Across the country, thousands more workers would be adversely affected if this critical industry is compromised. The purpose of U.S. antidumping and countervailing duties is to create a level playing field for domestic producers. Commerce’s preliminary determination effectively removes the remedy.
On the lawmakers’ push for Commerce to consider reversing the decision:
We urge Commerce to carefully reconsider the surrogate country selection and duty margin calculations in this case. The decision to use Romania is not only procedurally questionable but also fundamentally flawed in its logic and its consequences for U.S. industry.
On behalf of the workers in West Virginia, the operational health of the broader domestic industry, and the safety of American consumers, we respectfully request your intervention to correct course before a final determination is issued.
Your leadership is critical to ensuring that the Department upholds its mission to protect U.S. manufacturers and workers from unfair trade practices. Thank you for your attention to this matter.
Background:
- For nearly twenty years, the U.S. has levied anti-dumping (AD) and countervailing duties (CVD) on imports of this product from China due to unfair trade practices.
- When Commerce calculates AD/CVD duties, they use a comparison “surrogate” country that manufactures an identical or similar product for the purposes of calculating duty rates.
- For years, Commerce has used Mexico as the surrogate country for calculating China duties because Mexico produces a near identical product. However, in July 2024, Commerce used Romania instead of Mexico as the baseline example, despite the fact that Romania does not make the same product.
- Commerce’s decision will result in antidumping rates on China dropping by 80% and an increased competitive disadvantage for West Virginia workers and other American manufacturers.
