WASHINGTON -  U.S. Customs and Border Protection has reversed an earlier determination and now concludes cabinet importer Scioto Valley Woodworking, Inc. d/b/a Valleywood Cabinetry, did evade antidumping and countervailing duties by transshipping products through Malaysia.

Released to the public on Jan. 7, the draft remand redetermination was made pursuant to the U.S. Court of International Trade’s (CIT) order of Oct. 31, 2024, (released to the public Dec. 19). In that opinion and order, Judge Lisa Wang rebuked Customs’ Office of Rulings and Regulations (ORR or R&R) for overlooking evidence in making its decision, including the extent of Scioto and Alno's operational control by China-based Haiyan Group, the undisclosed warehouse and its contents, and previous admissions of transshipment. (Read the public version of Judge Wang's ruling.)

The case against Scioto/ Valleywood Cabinetry involves the evasion of antidumping and countervailing duties on orders of wood cabinets, vanities, and components (WCV) from China by transshipping through its affiliate Alno Industry SDN BHD in Malaysia.  on Jan. 31, 2023, Customs reached a final affirmative EAPA determination against the U.S. importer. However, after an appeal by Scioto/Valleywood, on June 12, R&R reversed the initial evasion determination. The American Kitchen Cabinet Alliance challenged the reversal and the case was brought before Judge Wang.

Per the CIT's order to reexamine the evidence, R&R found that although "Alno had the capability to manufacture WCV in Malaysia or that Alno purchased raw materials for such production," the company also purchased finished merchandise from China, and that there was no tracking system in place to prevent the commingling of merchandise for shipment. 

Also significant, R&R found "[H]aiyan Group had the ultimate discretion to determine whether Scioto would receive Chinese-origin or Malaysia-origin WCV. When this level of discretion is tied together with Scioto’s and Alno’s inability to track raw materials, inventory, and finished merchandise, it leaves Scioto with no way of knowing the country of origin of the WCV it receives or for Alno to know which customer will receive Malaysian-origin versus Chinese-origin merchandise."

Based upon its review, the agency said, "the ultimate conclusion reached in the R&R June 12 FAD is REVERSED,58 and R&R concludes that Scioto entered covered merchandise into the United States through evasion, as defined in 19 U.S.C. § 1517(a)(5)."

According to information on the Kitchen Cabinet Manufacturers Association website, the parties have until Jan. 17 to file written comments with CBP. CBP then must submit its final remand redetermination to the court by Jan. 30. After another round of briefing at the court, Judge Wang will issue her decision on the final remand redetermination.