(CN) - The Department of Commerce may have to recalculate labor wages for non-market economy countries as part of an anti-dumping investigation into wooden bedroom furniture imported from China to the United States.
When the Commerce Department valued the furniture, it improperly compared China to the economies of the Philippines and Pakistan, the American Furniture Manufacturers Committee for Legal Trade had claimed.
The agency arrived at the labor rate with the "bookend" countries' data under orders from the Federal Circuit, which last year invalidated the process by which the Commerce Department calculates the normal value of dumped products.
On appeal again, the U.S. Court of International Trade agreed that the calculation of average labor rates was skewed because the Philippines and Pakistan have lower per capita gross national incomes than China.
"Given the high correlation between per capita gross national income and wage rates, a correlation that Commerce acknowledges, Commerce's selection appears arbitrarily biased towards the low end of per capita gross national income," Chief Judge Donald Pogue wrote for the court on Feb. 9.
On remand the judge said the agency should explain why higher income countries were excluded from its data.
But Pogue said that the department was right to exclude data that was not available during the first anti-dumping investigation. The department also correctly used "capped" wage rate data from India, and limited wage rates by using countries where only data specific to the furniture industry was available.