## Facts

- Commerce issued an antidumping order on portable electric typewriters (PETs) from Japan, covering Silver Seiko, Ltd. and its U.S. subsidiary, Silver Reed America, Inc.
- In administrative reviews, Commerce compared foreign market value (FMV) to U.S. price calculated as exporter’s sales price (ESP), applying statutory “circumstances of sale” adjustments.
- Commerce’s practice permitted deduction of direct selling expenses from FMV, while certain indirect U.S. selling expenses were required by statute to be deducted from ESP.
- To limit asymmetric effects on the dumping margin, Commerce applied the “ESP offset cap” in 19 C.F.R. § 353.15(c), allowing FMV deductions for certain foreign indirect selling expenses only up to the amount of comparable indirect expenses deducted from ESP.
- Silver Seiko challenged the cap in the Court of International Trade (CIT), arguing that once indirect expenses were deductible in principle, Commerce could not cap the amount.
- The CIT held the ESP offset cap invalid as inconsistent with a “fair comparison,” certified the controlling question for interlocutory appeal, and the Federal Circuit accepted review limited to the cap’s validity.

## Issues

1. Whether 19 C.F.R. § 353.15(c)’s ESP offset cap is a valid exercise of Commerce’s authority under the antidumping statute.
2. Whether capping FMV deductions for foreign indirect selling expenses at the level of comparable indirect expenses deducted from ESP is consistent with the statutory requirement of a fair comparison between FMV and U.S. price.

## Decision

- The Federal Circuit reversed the CIT and held the ESP offset cap valid.
- The court concluded the regulation was a reasonable method to address asymmetrical statutory adjustments between FMV and ESP and to prevent distortion of dumping margins.
- The case was remanded for further proceedings consistent with the regulation’s validity.

## Legal Principles

- When the antidumping statute is silent or ambiguous on methodological details, Commerce has broad discretion to select reasonable calculation methodologies that further statutory purposes.
- Courts should defer to Commerce’s reasonable interpretation of the antidumping statute in technically complex matters and should not substitute judicial preferences for agency policy choices.
- The statutory requirement of a “fair comparison” does not mandate perfectly symmetrical adjustments; Commerce may use balancing mechanisms to account for unavoidable asymmetries in required deductions.
- An offset regulation that permits FMV deductions for foreign indirect selling expenses only up to the amount of comparable indirect expenses deducted from ESP can reasonably prevent over-adjustment and double counting that would artificially reduce or eliminate dumping margins.
- Longstanding, consistently applied regulations weigh in favor of validity absent a clear conflict with statutory text or purpose.

## Conclusion

The Federal Circuit upheld Commerce’s ESP offset cap as a permissible and reasonable antidumping methodology, finding it consistent with the statute’s fair-comparison objective and entitled to judicial deference.


Consumer Prods. Div., SCM Corp. v. Silver Reed Am., Inc., 753 F.2d 1033 (Fed. Cir. 1985)