Product Exclusion Request Process Now Includes Rebuttal

The Commerce Department (Commerce) released its Interim Final Rule (IFR) for submission of exclusion requests and objections in connection with the Section 232 Steel and Aluminum tariffs.  The IFR  was officially published in the Federal Register on September 11 and it went into effect that day.  The most significant change is that Commerce now allows submitters the opportunity to Rebut Objections to their Exclusion Request. However, the Objector then is allowed to rebut the rebuttal (the surrebuttal).  Time will tell whether adding a rebuttal and surrebuttal to the process will lead to more exclusions or just lead to the exclusion process taking even longer than it does now.

Under the new rule, after the Objection period closes (which Commerce estimates will be 31-45 days after an Exclusion Request has been posted (note, the trigger is posting not submission), Commerce will post that the seven-day rebuttal period will open, during which time the applicant for the Exclusion can rebut the Objections to the Request. After the rebuttal period closes, Commerce will open a seven-day surrebuttal period (they estimate this period will open within 15 days of the closing of the rebuttal period), during which time the Objectors can respond to the rebuttal. After the surrebuttal period closes Commerce will proceed to a final decision.  Commerce will not provide notice directly to Exclusion Request applicants that any of these new stages have been triggered but will instead only post this information on the website.  This means that companies with many different exclusion requests must track an inordinately large number of deadlines.

Representative Jackie Walorski’s (R-IN) office has been tracking the exclusion process and reported that there were 5801 rebuttals open for steel and 31 for aluminum. They’ve created a Rebuttal List, which we have posted to the AWPA website. The list provides the Exclusion that is open for rebuttal, the Objector and the Due Date of the Rebuttal Comments.  There are 2149 products in the Bar, Rod and Wire sector, with 18 AWPA wire companies as Requestor or Objector, and due dates of September 18, 19 or 20.

Commerce dismissed proposals for group exclusions (although groups may object), longer exclusion periods, broader categories of products, trade association filings, higher standards for objections, and a large list of other policy options that could have improved the exclusion process.

The IFR also states explicitly that the cost of replacement steel and aluminum will not be a variable that is considered for exclusion requests.

In its original exclusion process notice, Commerce predicted that approximately 4,500 Exclusion Requests would be filed during the life of the tariffs.  The IFR admits that this was underestimate—there were actually 38,000 Exclusion Requests filed by August 1, 2018, and approximately 17,000 Objections, and there have only been 2,200 final decisions issued.  They now predict that there will be 96,954 Exclusion Requests.