The Bureau of Industry and Security (BIS) made available an unpublished version of its rule to be published on the US Department of Commerce Web site. Link BIS Document

A more formal notice regarding the rule also appeared in the Federal Register, announcing a scheduled publication date of September 11th. Link to Federal Register Early Notice

Earlier this month BIS staff shared their thoughts with us. Obviously, this is still subject to change as the new proposed rule has yet to be published.

New Rebuttal Process

  1. Commerce has developed a new rebuttal and sur-rebuttal procedure for 232 cases prior to issuing a denial. The new rule went to the Office of Management and Budget (OMB) on August 29th and is expected to be published in 7-10 days.
  2. Only actual posted comments are considered and must be in the excel format provided. There was no prior process for rebuttal, and informal rebuttals of objections were not being considered in the process.
  3. BIS is currently holding pending applications to give an opportunity to applicants to participate in the rebuttal process once the rule is posted.
  4. With pending cases, parties will have 7 days to submit a rebuttal and US producers will have another 7 days for US producer sur-rebuttal.
  5. If you have received a denial, you can resubmit the filing, formally answering any objections received through the rebuttal process. In the end, if an exclusion is granted it will relate back to the date of filing (not the date of posting) of the original exclusion request. A party should resubmit their request if they think they can overcome a denial with the rebuttal process.
  6. The Rebuttal process is likely to add 60 days to the process.

Key Points for Rebuttals:

  • Provide documentation showing that the US mill cannot provide the product and is not an acceptable substitute.
  • Include any regulatory or independent agency/technical body standards that would drive a specific technical specification which US producers cannot meet.
  • Explain why any proffered substitutes will not meet US purchaser requirements or cannot be delivered in a timely fashion based on actual evidence (e.g. bid received).
  • Confidential information can be provided by checking the box marked “Confidential.” See, e.g. bottom box under Part 5 of the exclusion request form). Presumably the rebuttal form will also have such a box. If this box is checked information will not be made public on and ITA will contact you to gather the confidential information for review in the application/rebuttal.

Exclusion Screening Process

  • All exclusions are sent to U.S. Customs and Border Protection (CBP) for screening to determine if correct Harmonized Tariff Schedule (HTS) code is being used. If the CBP classification expert disagrees, exclusion will be rejected. (This can take some time.) Probably good to get a ruling from CBP to be certain. Contact the CBP product specialist and discuss correct classification.
  • If an objection is filed, the file goes to the International Trade Administration (ITA) trade enforcement compliance office (steel experts) for review. It could be the same folks involved in AD/CVD cases. ITA then reviews and recommends whether a product is in short supply or not comparable to US production. If a denial has a reference to ITA in it, it is because ITA analysts determined the product was available from US sources. Then, it comes back to BIS for national securityreview and final decision.

From the Unpublished Rule Summary Posted on the BIS Website

“The changes to the exclusion processes in this rule are informed by both the comments received in response to the March 19 rule and the Department’s experience with managing the exclusion 7 process. The comments identified a number of areas where transparency, effectiveness and fairness of the exclusion and objection process could be improved, including adding a rebuttal and sur-rebuttal process. The Department has incorporated changes based on many of those comments and has also included other process improvements. The publication of today’s rule should make significant improvements in all three respects, but because of the scope of this new process, BIS is publishing today’s rule as a second interim final rule with request for comments.”