Khanna, Moolenaar Press Commerce Department to Maintain Strong Enforcement of U.S. Trade Laws

WASHINGTON – Today, Ranking Member Ro Khanna and Chairman John Moolenaar of the House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party sent a bipartisan letter to Commerce Secretary Howard Lutnick urging the Department of Commerce to uphold longstanding strong trade enforcement practices to prevent bad actors, like China, from harming domestic manufacturers. Specifically, they ask the Department to reaffirm its longstanding practice of applying a higher duty in antidumping and countervailing duty (AD/CVD) investigations when foreign companies refuse to cooperate.

In the letter, the Ranking Member and Chairman raised concerns that recent proceedings may signal a departure from established enforcement practices by considering duty rates significantly below petition levels even in cases of complete respondent non-cooperation.

They further warned that weakening the use of Adverse Facts Available (AFA) could undermine U.S. trade laws, reduce deterrence against unfair trade practices, harm American workers and industry, and incentivize foreign companies to withhold information during Commerce Department investigations. 

“These concerns are especially acute in the context of China, which has repeatedly demonstrated non-cooperation with Commerce Department investigations,” the lawmakers wrote. “The integrity of AFA rate application practice is not an abstract procedural question, but rather a frontline tool to hold Chinese producers accountable. Weakening that tool directly undermines supply chain security objectives that this committee and the administration have made a priority.”

They have requested that the Commerce Department provide answers to the following questions. 

• What, if any, policy changes have been made to the selection of AFA rates in antidumping and countervailing duty proceedings? 
  • Please provide any guidance that has been distributed to Commerce Department staff involved in investigations into and administration of antidumping and countervailing duties cases. 
  • If applicable, what is the Department’s rationale for making any policy changes? 
• What is the legal justification for departing from petition rates in cases involving total respondent non-cooperation? 
• What is the Department’s assessment of how reduced AFA margins will or will not continue to fulfill the statutory deterrent purpose AFA rates established by Congress?

“Strong enforcement of U.S. trade laws is a cornerstone of protecting American workers, safeguarding industrial capacity, and ensuring fair competition,” the lawmakers concluded. “Any erosion of that enforcement, particularly in cases involving strategic competitors, would have significant economic and national security implications.”

Read the letter here.

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