–65 
(citations omitted). Thus, the court

concluded that “[t]he plain language of the statute, persuasive case law from this court, and the

legislative history all support the proposition that the duty drawback must be tied to exported

merchandise, not overall domestic production.”
 Id. at 1365. 
Based on this conclusion, the court

remanded the duty drawback methodology to Commerce “in accordance with [that] opinion.”
 Id.

at 1365, 1372.
       Of further relevance to Commerce’s Remand Results, Congress authorized Commerce to

adjust normal value for differences between home market price and U.S. price that are not
Consol. Court No. 18-00143                                                                    Page 8


otherwise provided for in the statute and are due to “other differences in the circumstances of sale,”

i.e. COS adjustments. 19 U.S.C. §1677b(a)(6)(C)(iii). Commerce’s regulations interpreting this

provision limit COS adjustments to “direct selling expenses and assumed expenses.” 19 C.F.R. §

351.410(b). Commerce defines direct selling expenses as “expenses, such as commissions, credit

expenses, guarantees, and warranties, that result from, and bear a direct relationship to, the

particular sale in question.”
 Id. § 351.401(c). By 
contrast, Commerce defines assumed expenses

as “selling expenses that are assumed by the seller on behalf of the buyer, such as advertising

expenses.”
 Id. § 351.410(d).

       II. 
    Commerce’s Remand Methodology

       On remand, Commerce added the full amount of duty drawback to the United States export

price in its AD duty calculation as directed by the court. Remand Results at 12. Further,

Commerce made additional COS adjustments to normal value of wire rod in Turkey because of its

continued insistence on accounting for Turkey’s drawback scheme on both sides of the home

market to U.S. price comparison. See
 id. at 14. 
Commerce’s remand methodology provides for

two COS adjustments, one to remove all duties from normal value and a second to add the per-

unit amount of duty as the export price to normal value.
 Id. at 15–16. 
Finding that “neither +DEDú

nor Icdas recorded import duties associated with imported raw materials in its costs,” Commerce

concluded that no COS adjustment requirement was required to “remove all booked duties eligible

for rebate from the [constructed value] and home market price[].”
 Id. at 15. 
Second, Commerce

made a COS adjustment to account for the fact that Turkey’s duty drawback scheme “allocated

[the price of inputs] across overall production, rather than market-specific production,” a

difference from standard costs accounting.
 Id. at 16. 
Thus, Commerce “add[ed] to the [normal

value] the same per-unit amount of rebated or forgiven duty added to U.S. price.”
 Id. at 17.
Consol. Court No. 18-00143                                                                   Page 9


Commerce explained that in accordance with the purpose of the drawback duty statute and the

Federal Circuit’s opinion in Saha Thai, it made these adjustments to account for Congress’s

assumption in implementing the statute that home market price reflects import duties.
 Id. at 7–8.
Thus, the difference in circumstance was the assignment of duty costs to products “based on where

they were sold.”
 Id. at 14. 
In sum, Commerce made a different adjustment to its duty calculation

on remand to achieve the same results as its original duty neutral methodology.

       The Government and Nucor explain these results as consistent with the court’s remand

order, in accordance with “applicable statutory and regulatory provisions,” and not precluded by

other decisions of this court. Def.’s Br. at 3, 6–21; Def.-Inter.’s Br. at 4, 14. The Government

states that, because Commerce “assumes that imported inputs were consumed in the exported

finished goods,” “that a [COS] adjustment was required to make a fair comparison between normal

value and export prices.” Def.’s Br. at 3 (citations omitted). The Government concludes that

Commerce’s remand methodology comports with the purpose of the duty drawback statute, which

it describes as “to prevent artificially overstating the [AD] margin,” and the underlying assumption

of the statute “that the adjustment to United States price is necessary because the same amount of

duties are included in the normal value.” Def.’s Br. at 10. Similarly, Nucor claims that

Commerce’s Remand Results are supported by the same justifications for the duty neutral

methodology rejected by the court’s previous opinion.         See Def.-Inter.’s Br. at 4–9.    The

Government also concludes that the Remand Results are consistent with the court’s instructions

that did not bar “a [COS] adjustment to normal value to account for direct selling expenses.” Def.’s

Br. at 12. See also Def.-Inter.’s Br. at 1.

       Plaintiffs maintain that the Remand Results do not comply with the court’s remand

instructions, the statute, Commerce’s regulations, or caselaw. Pl.’s Br. at 4–14; Consol. Pl.’s Br.
Consol. Court No. 18-00143                                                               Page 10


at 1–11. First, Plaintiffs argue that Commerce’s COS adjustment negates the duty drawback

adjustment ordered by the court and rests on flawed assumptions about the effect of Turkey’s duty

drawback scheme and the purpose of the duty drawback adjustment. See Pl.’s Br. at 4–5. See also

Pl.’s Br. at 12 (“[A]s [Commerce] has itself concluded, ‘[t]o make an adjustment to [normal value]

for duty drawback where there is no evidence of such drawback on home market sales would

nullify the adjustment to U.S. price.’” (quoting Welded Carbon Steel Standard Pipe and Tube

Products from Turkey: Final Results of Antidumping Duty Administrative Review and Final

Determination of No Shipments; 2013–2014, 80 Fed. Reg. 76,674 (Dep’t Commerce Dec. 10,

2015), and accompanying Issues and Decision Mem. at 14, cmt. 4)); Consol. Pl.’s Br. at 5–6.

Plaintiffs also argue that Commerce’s remand methodology is inconsistent with the duty drawback

statute, COP adjustment statute, and Commerce’s regulations implementing these statutes. Pl.’s

Br. at 6–12; Consol. Pl.’s Br. at 8–9, 11–12. Finally, Plaintiffs note that Commerce’s remand

methodology has also been rejected by the court in several recent decisions and is unsupported by

the Federal Circuit’s caselaw. Pl.’s Br. at 13–15 (citations omitted); Consol. Pl.’s Br. at 1–5

(citations omitted). See also Consol. Pl.’s Br. at 7 (“Commerce conflates the cost adjustment

permitted in Saha Thai with a more general adjustment to normal value, which was never addressed

in Saha Thai.”).

        III.    Analysis
        The court concludes that Commerce’s remand methodology does not comport with the

plain language of the statute. 2

        On remand, Commerce classified the operation of Turkey’s duty drawback scheme as a

direct selling expense and thus made a COS adjustment to normal value to account for this expense.


2
  Because the court remands Commerce’s Remand Results on this basis, it need not address the
remainder of Plaintiffs’ challenges to Commerce’s remand methodology.
Consol. Court No. 18-00143                                                                  Page 11


Remand Results at 13–14. Commerce explained that the statute allows for an adjustment to normal

value where a duty drawback scheme, such as the one at issue here, “treat[s] the import duty

liability different from standard cost accounting by permitting the assignment of imported inputs

and the associated imports duties to export sales, while attributing the domestic purchases

exclusive of duty to domestic sales.” Remand Results at 13 (citing 19 U.S.C. § 1677b(a)(6)(C)(iii);

Uruguay Round Agreements Act, Statement of Administrative Action, H.R. Doc. No. 103-316,

Vol. 1, 820 (1994), reprinted in 1994 U.S.C.C.A.N. 4040, 4163).

       However, Commerce’s methodology and explanation for its COS adjustment does not

comport with the statute or its own interpretation that statute. 3 The statute allows for adjustments

to normal value for differences between normal value and U.S. price, “other than a difference for

which allowance is otherwise provided under this section” and are due to “other differences in the

circumstances of sale.” 19 U.S.C. § 1677b(a)(6)(C). This language explicitly ties adjustments to

normal value to differences in sales, excluding all other adjustments directed by statute. Here,

Commerce made an adjustment to normal value in order to address what it views as a distortion




3
  Plaintiffs also challenge the Remand Results as inconsistent with Commerce’s regulations, Pl.’s
Br. at 6–11; Consol. Pl.’s Br. at 8–9. Two other opinions of the court conclude that the same
methodology applied on remand here also contravenes Commerce’s own regulation. +DEDú Sinai
ve Tibbi Gazlar Istihsal Endustrisi, A.S. v. United States, 43 CIT __, 
361 F. Supp. 3d 1314 
(2019);

id., 43 
CIT __, __, 
415 F. Supp. 3d 1195
, 1210–12 (2019) (“+DEDú II”)
, id., 44 
CIT __, 439 F.
Supp. 3d 1342 (2020)
, id., 44 
CIT __, Slip Op. 20-131 (Sept. 4, 2020); Ere÷li Demir ve Çelik
)DEULNDODUL7$ùY8QLWHG6WDWHV, 42 CIT __, 
308 F. Supp. 3d 1297 
(2018);
 id., 42 
CIT __, 
357
F. Supp. 3d 1325 
(2018)
, id., 43 
CIT __, 
415 F. Supp. 3d 1216
, 1230–32 (2019);
 id., 44 
CIT __,
435 F. Supp. 3d 1378 
(Apr. 13, 2020), appeals docketed, Nos. 2020-1999; 2020-2003 (Fed. Cir.
June 10, 2020); Uttam Galva Steels Ltd. v. United States, 42 CIT __, 
311 F. Supp. 3d 1345 
(2018);

id., 43 
CIT __, 
374 F. Supp. 3d 1360 
(2019) (“Uttam Galva II”);
 id., 43 
CIT __, __, 
416 F. Supp.
3d 
1402, 1407 (2019) (“Uttam Galva III”), appeal docketed No. 2020-1461 (Fed. Cir. Feb. 12,
2020). The court need not reach that issue because of its conclusion that Commerce’s methodology
did not comport with the statute. The court refers to the regulation only to the extent that
Commerce’s own interpretation of the statute illustrates that its remand methodology violates the
statutory language.
Consol. Court No. 18-00143                                                                Page 12


created by the duty drawback provision and Turkey’s duty drawback scheme as it impacts overall

production costs. Remand Results at 12–14. Thus, Commerce did not address a cost incurred

because of the circumstance of a particular sale, but instead the impact on overall costs by

operation of law. See also Pl.’s Br. at 5 (“[Commerce] again improperly compares U.S. price to

[cost of production] to register an imbalance, despite the fact that there is only one [cost of

production] in a dumping calculation and no distortion from a [normal value]-export [cost of

production] differential”).

       COS adjustments are made to compare prices “at a similar point in the chain of commerce.”

Maverick Tube Corp. v. Tosçelik Profil ve Sac Endustrisi A.S., 
861 F.3d 1269
, 1274 (Fed. Cir.

2017) (citation omitted). This does not include varying duty costs resulting from different sources

of inputs and a corresponding statutory duty drawback adjustment. Cf. +DEDú Sinai ve Tibbi

Gazlar Istihsal Endustrisi, A.S. v. United States, 43 CIT __, 
361 F. Supp. 3d 1314 
(2019);
 id., 43
CIT __, __, 
415 F. Supp. 3d 1195
, 1212 (2019) (“+DEDúII”);
 id., 44 
CIT __, 
439 F. Supp. 3d 1342
(2020);
 id., 44 
CIT __, Slip Op. 20-131 (Sept. 4, 2020) (citing Antidumping Duties; Countervailing

Duties, 61 Fed Reg. 7,308, 7,346 (Dep’t Commerce Feb. 27, 1996)); Ere÷li Demir ve Çelik

)DEULNDODUL7$ùY8QLWHG6WDWHV, 42 CIT __, 
308 F. Supp. 3d 1297 
(2018);
 id., 42 
CIT __, 
357

F. Supp. 3d 1325 
(2018) (“Ere÷li II”);
 id., 43 
CIT __, 
415 F. Supp. 3d 1216
, 1231 (2019) (“Ere÷li

III”);
 id., 44 
CIT __, 
435 F. Supp. 3d 1378 
(Apr. 13, 2020), appeals docketed, Nos. 2020–1999;

2020–2003 (Fed. Cir. June 10, 2020) (same). See also Consol. Pl.’s Br. at 8–9 (“As the cost-side

adjustment approved in Saha Thai makes clear, the imputation of a duty cost affects the cost of

production; it does not relate to sales transactions.”). If COS adjustments were interpreted as

broadly as Commerce suggests in its Remand Results, then it may also follow that Commerce

could use COS adjustments to nullify any adjustment to export price statutorily provided for in the
Consol. Court No. 18-00143                                                                Page 13


interest of a “fair comparison.” 4 The court, instead, reads the COS provision to effectuate the

meaning of the Trade Act as a whole. Commerce’s remand methodology using a COS adjustment

contravenes the statute. 5 See 
Chevron, 467 U.S. at 842
–43 (holding, where “Congress has directly

spoken to the precise question at issue,” “that is the end of the matter” because the court “must

give effect to the unambiguously expressed intent of Congress”).

       Commerce improperly treats the COS provision as a catch-all adjustment for normal value

calculation. Commerce contends that the COS “provision is the only means to ensure a fair

comparison” with a duty exemption program like the one at issue here. Remand Results at 36.

See also Remand Results at 38 (“Such an expense is exactly what the COS adjustment is created

for when no other statutory provision applies.”). However, Commerce may not use the COS

provision as a catch-all provision but must make COS adjustments in line with the text and purpose

of the statute. See Zenith Elecs. Corp. v. United States, 
14 CIT 831
, 837, 
755 F. Supp. 397
, 406

(1990) (“Zenith I”), aff’d, 
988 F.3d 1573 
(Fed Cir. 1993) (“Zenith II”) (stating that the COS

provision “is not an omnibus provision to be used . . . for whatever adjustment [Commerce] seek[s]


4
  As the court noted in +DEDú II, the statute as explained by the Federal Circuit expressly states
how to make a fair comparison between normal value and U.S. 
price. 415 F. Supp. 3d at 1210
(citing Timken Co. v. United States, 
354 F.3d 1334
, 1344 (Fed. Cir. 2004)). Thus, the court in
+DEDú II concluded that “the ‘fair comparison’ requirement is met when normal value is calculated
in accordance with the statute and does not provide Commerce with additional authority to make
adjustments ‘beyond those explicitly established in the statute.’”
 Id.
5
  While the Government claims that Commerce’s remand methodology is “not an adjustment to
the costs of production in the home market,” but rather an adjustment to normal value, Def.’s Br.
at 8, its own explanation of the COS adjustment explains that it is tied to Commerce’s calculation
of “cost based on the annual average cost of input, which includes both input prices with duties
and domestically-sourced inputs without duties.” Def.’s Br. at 14. Thus, its claim that the purpose
of duty drawback scheme being to promote export sales and “incentivize[s] parties to produce
merchandise from an imported input and export the merchandise” in order to justify the COS
adjustment is unavailing. See Def.’s Br. at 19. See also Def.-Inter.’s Br. at 12 (“[W]here there is
a duty drawback system in place, duty costs are an expense related to a respondents’ [sic] decision
to sell goods to a particular market.”).
Consol. Court No. 18-00143                                                                Page 14


to effect”). The Zenith cases are instructive on this point. In Zenith I, this court rejected

Commerce’s use of a COS adjustment to make an adjustment to normal value to nullify a statutory

adjustment for taxes tied to exportation in order to achieve a tax neutral dumping margin to avoid

what Commerce considered a distortion in the dumping 
margin. 755 F. Supp. at 405
–07. The

court held that COS adjustments “provide a means for addressing those items not otherwise

included in the statute,” and that, because the tax adjustment was statutorily provided for,

Commerce could not use the COS provision to further adjust the normal value to account for these

taxes.
 Id. at 406. 
The Federal Circuit agreed with this holding on appeal and stated that the court

“properly interpreted the general circumstances-of-sale language to prevent [Commerce] from

effectively writing the specific tax adjustment section out of the statute.” Zenith 
II, 988 F.3d at

1581
. Further, the Federal Circuit stated, “Commerce did not employ [the COS adjustment

provision] to remedy a dumping margin variance caused by a circumstance of sale, but a variance

caused by operation of the [statute].”
       Id. (“[N]othing in the 
enactment history of the

circumstances-of-sale provision permits [Commerce] to trump the express and specific statutory

language.”). Commerce’s COS adjustment here is remarkably analogous. 6 Thus, the court

concludes that Commerce may not use a COS adjustment to nullify the duty drawback adjustment

provided for by statute.

       Furthermore, Commerce’s reliance on Saha Thai is strained. Commerce states that “the

Federal Circuit has held, in Saha Thai, that it is appropriate for Commerce to add the duty to




6
  Nucor argues that this case is more analogous to a case that followed the Zenith cases, Federal-
Mogul Corporation v. United States, in which the Federal Circuit upheld Commerce’s tax neutral
methodology. Def.-Inter.’s Br. at 14–15. The court does not find this argument persuasive because
Federal-Mogul did not overturn the Zenith cases but instead approved of a tax neutral methodology
that did not include a COS adjustment. See 
63 F.3d 1572
, 1577–82 (1995). Thus, the Zenith cases
are more analogous to Commerce’s methodology using a COS adjustment here.
Consol. Court No. 18-00143                                                                   Page 15


[normal value], because otherwise the dumping calculation would not be duty-drawback neutral.”

Remand Results at 33 
(citing 635 F.3d at 1343
). The Federal Circuit in Saha Thai affirmed

adjustments to cost of production and constructed value that were included in the normal value

calculation, not a direct adjustment to normal value through a COS 
adjustment. 635 F.3d at 1341
–

43. See also Uttam Galva Steels Ltd. v. United States, 42 CIT __, 
311 F. Supp. 3d 1345 
(2018);


id., 43 
CIT __, __, 
374 F. Supp. 3d 1360
, 1363 (2019) (“Uttam Galva II”);
 id., 43 
CIT __, 416 F.

Supp. 3d 1402 (2019) (“Uttam Galva III”), appeal docketed, No. 2020-1461 (Fed. Cir. Feb. 12,

2020) (“Saha Thai . . . should not be expanded to encompass all duty drawback adjustment

calculations made by Commerce”) (citation omitted); Ere÷li 
II, 357 F. Supp. 3d at 1334
(“Commerce’s interpretation of the Federal Circuit’s discussion of duty inclusivity[, in Saha Thai]

. . . , which would neutralize the duty drawback adjustment, goes further than the opinion supports

and is inconsistent with the purpose of the statute.”). There, the Federal Circuit observed that “[a]n

import duty exemption granted only for exported merchandise has no effect on home market sales

prices” and thus, “the duty exemption should have no effect on [normal value].” Saha 
Thai, 635

F.3d at 1342
. Commerce’s reliance on Saha Thai for an overall adjustment to normal value

stretches Saha Thai’s holding on cost calculations beyond its meaning. More importantly, the

Saha Thai holding did not speak directly to COS adjustments to normal value, the defect that the

court identifies in Commerce’s remand methodology here.

       Notably, this court rejected Commerce’s remand methodology in four other opinions after

being instructed to recalculate duty drawback adjustments on remand. See generally +DEDú II;
Consol. Court No. 18-00143                                                                Page 16


(UH÷OL III; Uttam Galva III; Tosçelik III. 7 Commerce’s methodology in this case is no different,

as Commerce and the Government acknowledge. Remand Results at 38; Def.’s Br. at 16. 8

       Finally, Commerce’s remand methodology does not comport with the court’s previous

opinion. As Commerce explains in the Remand Results, “Commerce . . . applied its revised

methodology to account for duty drawback on the [normal value] side of the equation.” Remand

Results at 12.    Thus, Commerce’s remand methodology, like the duty neutral drawback

methodology the court held to be unlawful in Icdas I, also has the effect of adjusting normal value

so that the duty drawback is not strictly tied to exported merchandise as required by statute. See

Icdas 
I, 429 F. Supp. 3d at 1365 
(holding that Commerce may not divide “the duty drawback over

domestic sales, to which the drawback is unrelated”). That Commerce repackaged this adjustment

as a COS adjustment does not alter the court’s previous conclusion. Cf. Zenith 
III, 988 F.2d at

1581 
(holding that Commerce may not use the COS provision to “effectively writ[e] [a separate

adjustment] section out of the statute.”). See also +DEDú 
II, 415 F. Supp. 3d at 1209
; (UH÷OL 
III,

415 F. Supp. 3d at 1228
–29; Tosçelik 
III, 415 F. Supp. 3d at 1400 
(“[T]he circumstance of sale

adjustment does not remedy an imbalance; it negates the duty drawback adjustment.”). In response

to Plaintiffs’ arguments on the draft remand results, Commerce stated that its remand methodology



7
  Various appeals from these decisions are pending at the Federal Circuit. See (UH÷OL, appeals
docketed, Nos. 2020-1999; 2020-2003 (Fed. Cir. June 10, 2020); Uttam Galva, appeal docketed,
No. 2020-1461 (Fed. Cir. Feb 12, 2020). However, as of the date of this opinion, the Federal
Circuit has not yet heard argument or decided any appeal of Commerce’s duty drawback or COS
calculations.
8
  Commerce attempts to argue that its similar use of a COS adjustment was sustained in Uttam
Galva III. Remand Results at 37. While that correctly summarizes the posture of the case, the
court specifically detailed its concerns with the adjustment, stating that Commerce’s COS
adjustments “are suspect” and explaining that “Commerce’s [COS] adjustments do not result from
circumstances concerning the sale of merchandise.” Uttam Galva III, 
416 F. Supp. 3d 
at 1407.
Ultimately, because plaintiffs’ AD rates were calculated to be zero, plaintiffs did not further
challenge Commerce’s methodology and thus the methodology was sustained.
 Id.
Consol. Court No. 
18-00143                                                                   Page 17


comported with the court’s order because the court “did not remand this issue with specific

instructions on how to address the duty drawback adjustment to the [normal value] side of the

equation.” Remand Results at 31. However, an altered methodology that negates the court’s

remand instruction does not comply with those instructions.

       Thus, Commerce’s new methodology is unlawful and did not comply with the court’s

remand instructions.

                                          CONCLUSION

       The court concludes that Commerce’s full duty drawback adjustment to export price in its

Remand Results was in accordance with law and the court’s remand instructions. This aspect of

Commerce’s remand is sustained.          However, the court concludes that Commerce’s COS

adjustment to normal value was not in accordance with law or the court’s remand instructions.

The court thus remands the Remand Results to Commerce. On remand, Commerce shall,

consistent with this opinion, recalculate normal value without making a circumstance of sale

adjustment related to the duty drawback adjustment made to export price (or constructed export

price). Commerce shall file with this court and provide to the parties its remand results within 90

days of this order; thereafter the parties shall have 30 days to submit briefs addressing the revised

final determination with the court, and the parties shall have 30 days thereafter to file reply briefs

with the court.

       SO ORDERED.

                                                              /s/ Gary S. Katzmann
                                                              Gary S. Katzmann, Judge

 Dated: September 23, 2020
        New York, New York