Interim Reviews (section 76.01)
MATTRESS INNERSPRING UNITS
Interim Review No. RD-2011-004
Friday, March 30, 2012
Friday, April 13, 2012
TABLE OF CONTENTS
IN THE MATTER OF an interim review, pursuant to subsection
76.01(1) of the Special Import Measures Act, of the
finding made by the Canadian International Trade Tribunal on
November 24, 2009, in Inquiry No. NQ-2009-002, concerning:
THE DUMPING OF MATTRESS INNERSPRING UNITS ORIGINATING IN
OR EXPORTED FROM THE PEOPLE’S REPUBLIC OF CHINA
The Canadian International Trade Tribunal, pursuant to
subsection 76.01(1) of the Special Import Measures Act,
has conducted an interim review of its finding made on November 24,
2009, in Inquiry No. NQ-2009-002, concerning the dumping of
mattress innerspring units, with or without edgeguards, used in the
manufacture of innerspring mattresses, originating in or exported
from the People’s Republic of China.
Pursuant to paragraph 76.01(5)(a) of the Special
Import Measures Act, the Canadian International Trade Tribunal
hereby continues the finding without amendment.
Pasquale Michaele Saroli
Pasquale Michaele Saroli
The statement of reasons will be issued within 15 days.
Tribunal Members: Serge Fréchette, Presiding Member
Diane Vincent, Member
Pasquale Michaele Saroli, Member
Research Directors: Randolph W. Heggart
Lisa Backa Demers
Senior Research Officer: Josée St-Amand
Counsel for the Tribunal: Georges Bujold
Manager, Registrar Programs and Services: Michel Parent
Registrar Officer: Julie Lescom
Registrar Support Officer: Jade Realffe
|Simmons Canada Inc.
||Andrew M. Lanouette
|Les Ressorts Primeau Inc.
|Owen & Company Limited (Kingsdown)
||Benjamin P. Bedard
Paul D. Conlin
Please address all communications to:
Canadian International Trade Tribunal
Standard Life Centre
333 Laurier Avenue West
1. On November 10, 2011, the Canadian International Trade
Tribunal (the Tribunal) received a request from Owen & Company
Limited, a manufacturer of mattresses known as Kingsdown, for an
interim review under section 76.01 of the Special Import
Measures Act1 of the Tribunal’s finding made on November
24, 2009, in Inquiry No. NQ-2009-002 (the injury inquiry)
concerning mattress innerspring units originating in or exported
from the People’s Republic of China (China) (the subject
goods). Kingsdown requested that the Tribunal, on
completion of the interim review, rescind its finding.
2. In its request, Kingsdown submitted that Globe Spring &
Cushion Co. Ltd. (Globe Spring), a domestic producer at the time of
the injury inquiry, whose production accounted for over 90 percent
of merchant market sales of like goods, ceased to manufacture
mattress innerspring units in Canada in October 2011.
Accordingly, Kingsdown submitted that, in practical and legal
terms, there was no longer any domestic production of like goods
and that, as a result, the basis for the Tribunal’s finding no
longer existed. Kingsdown further submitted that the existence of
production for internal processing and from small producers that
cannot supply any meaningful proportion of the domestic market was
not sufficient to support the finding.2
3. On November 29, 2011, the Tribunal decided that the request
for an interim review was properly documented, as prescribed by
subrule 70(1) of the Canadian International Trade Tribunal
Rules.3 In addition, pursuant to subrule 70(2), the
Tribunal informed all parties to the injury inquiry of its receipt
of the request and invited them to make representations concerning
Kingsdown’s request by December 12, 2011.
4. The Tribunal received only one response. The sole party to
file representations was Simmons Canada Inc. (Simmons), a producer
of like goods, on December 12, 2011. Simmons stated that it
currently manufactures and will continue to manufacture mattress
innerspring units in Canada and intends to consume all of its
production in its own manufacturing environment. Simmons submitted
that none of the like goods that it produces are destined for the
merchant market and that its production will be entirely for
5. On December 14, 2011, in its reply submission, Kingsdown
noted that Globe Spring, Les Ressorts Alpha Inc. (Alpha) and Les
Ressorts Primeau Inc. (Primeau)4 had not filed submissions.
Consequently, according to Kingsdown, there was no evidence of
current Canadian production for the merchant market, no interest on
the part of any company in having the finding continued and no
utility or value in having the finding continued.
6. On the basis of the submissions received, the Tribunal
decided that an interim review of the finding was warranted and
issued a notice of commencement of interim review on December 28,
2011.5 In accordance with paragraph 25(c)
of the Rules, the Tribunal decided to proceed with a
hearing by way of written submissions. Submissions already filed by
interested parties were placed on the record of the interim review.
The Tribunal asked that any further submissions by parties be filed
no later than January 18, 2012, with any reply submissions due on
January 27, 2012.
7. The Tribunal indicated in its notice of commencement of
interim review that the purpose of this interim review was to
determine if the finding should be rescinded on the basis that
there is no longer any domestic production of mattress innerspring
units sold in the Canadian merchant market, as claimed by
Kingsdown. In this regard, parties were asked to address, in their
submissions, the issue of whether there is still any production of
mattress innerspring units in Canada and, in particular, whether
there is still domestic production being sold in the merchant
POSITIONS OF THE
Parties Supporting the
8. Kingsdown submitted that the Tribunal has no alternative but
to rescind its finding since there is no evidence of current
domestic production of mattress innerspring units for the merchant
market, no interest on the part of any company in having the
finding continued and, therefore, no purpose in having the finding
9. As background information on the injury inquiry, Kingsdown
submitted that the Tribunal, in analyzing the domestic industry,
considered the operations of seven companies. According to
Kingsdown, three of them produced only for their own internal
consumption,6 Simmons sold very small quantities of niche
mattress innerspring units but otherwise used its production
internally, leaving Globe Spring, Alpha and Primeau with merchant
market sales. Kingsdown further submitted that Globe Spring, at
that time, was by far the largest Canadian producer of mattress
innerspring units for sale in Canada, with production and sales
representing more than 90 percent of domestic production and sales
in the merchant market.7 Kingsdown also submitted that Alpha and
Primeau, during the injury inquiry, did not provide any indication
of support for, or interest in, the Tribunal’s injury inquiry, as
they did not provide any evidence, did not file a full
questionnaire response and did not appear at the Tribunal’s
10. In terms of developments since the finding in the injury
inquiry, Kingsdown submitted that, in October 2011, Globe Spring
ceased Canadian production of mattress innerspring units and
intends to service its Canadian customers from the production of
its parent company, Leggett & Platt Incorporated, located in
the United States.
11. Kingsdown also submitted that, while there continues to be
Canadian production of mattress innerspring units for internal use
in the production of mattresses, it is not sufficient to support an
injury finding. In this regard, Kingsdown submitted that, in the
injury inquiry, the Tribunal did not consider the issue of whether
the subject goods caused injury to the domestic production of like
goods destined for internal processing.
12. Kingsdown argued that, in the injury inquiry, the Tribunal
focused its injury analysis on the impact of the subject goods on
the domestic merchant market of mattress innerspring units.
Regarding the Tribunal’s statement that the materiality of any
injury caused by the dumping was assessed against the domestic
industry’s production of like goods as a whole, Kingsdown submitted
that this statement confirmed that the Tribunal only reached a
determination on the quantification of injury to the production of
like goods destined for the merchant market and then concluded that
this injury was material even when assessed against the entirety of
the domestic production. Put another way, according to Kingsdown,
the inclusion of all domestic industry production for the purposes
of the assessment of materiality could only dilute the overall
impact of the quantified injury.
13. In particular, Kingsdown submitted that the Tribunal found
that the subject goods had caused injury to the domestic industry
in the merchant market and that, since production for the merchant
market accounted for more than 70 percent of total domestic
production, the extent of the injury found was enough to be
material when considered in relation to total domestic
14. According to Kingsdown, the Tribunal’s analysis did not, at
any point, analyze injury to domestic production of mattress
innerspring units for internal use (which was only relevant to the
question of materiality) or injury to Alpha or Primeau. Kingsdown
submitted that the Tribunal determined that Globe Spring’s
results were representative of the overall domestic industry in the
merchant market due to its high volume of domestic production and
sales, more than 90 percent, in that market.
15. According to Kingsdown, when that analytical framework is
applied to the current situation (i.e. in view of the cessation of
Globe Spring’s production), it is clear that the finding no longer
has the necessary factual or legal basis to remain in effect.
Kingsdown submitted that, since more than 90 percent of the
domestic production for the merchant market sales has ceased, it is
no longer reasonable to deem Globe Spring’s results to be
representative of the entire domestic production for merchant
market sales, as was done in 2009.
16. Kingsdown further submitted that, since Globe Spring,
Primeau and Alpha chose not to respond to the Tribunal’s request to
advise of their current production in this interim review, there is
no evidence of current Canadian production of mattress innerspring
units and certainly no evidence that Alpha or Primeau suffered
injury caused by the subject goods.
17. Kingsdown requested the rescission of the Tribunal’s
finding, stating that, in the absence of evidence of any current
domestic production of mattress innerspring units for merchant
market sales, the basis for the finding is no longer present.
18. In its reply submission in response to Primeau’s claims,
Kingsdown argued that the only evidence of Primeau’s production is
a very limited partial questionnaire response. Kingsdown also
argued that Primeau’s submission “. . . is not
evidence of the sort upon which the Tribunal can base a decision.”
Kingsdown also submitted that Primeau would ask that the Tribunal
“. . . continue its finding on the basis of a
three-year old, partial questionnaire response and, now, a letter
that does not provide a single figure.”8
19. According to Kingsdown, the issue before the Tribunal in an
interim review is whether the facts that led to the Tribunal’s
finding are still in place, so that the evidence and the legal
bases for the finding still stand. Kingsdown submitted that Globe
Spring represented more than 90 percent of domestic sales for the
merchant market and that only Globe Spring was found by the
Tribunal to have been injured by dumped imports, not Primeau.
According to Kingsdown, the Tribunal, after not having been able to
conclude that Primeau suffered injury because of the paucity of the
information that it provided in the injury inquiry, cannot, in this
interim review, conclude that there is sufficient evidence to
continue the finding.
20. Alternatively, if the Tribunal is inclined to continue the
finding on the basis of Primeau’s alleged production for the
merchant market, Kingsdown submitted that natural justice and
procedural fairness would require that Primeau be directed by the
Tribunal to provide actual specific evidence of its production
capacity and sales, in order that it might be tested during an oral
hearing. According to Kingsdown, while the finding may be rescinded
on the basis of the information on the administrative record, it
cannot be continued without an oral hearing.
21. Matelas Mirabel, in a submission, supported Kingsdown’s
request and requested the rescission of the finding.
Parties Opposed to the
22. The Tribunal received submissions from Marshall and Primeau,
requesting that the finding be continued.
23. Marshall stated that it still manufactures in Canada, as
does Simmons, pocket coil mattress innerspring units and that both
were valued customers of Globe Spring. Marshall stated that the
dumping of the subject goods continues. Furthermore, according to
Marshall, Globe Spring was forced to cease its operations due to
continued tariff evasion by Chinese exporters and Canadian
importers of mattress innerspring units. On this matter, Marshall
stated that the subject goods go through one or more countries
before entering Canada, so that the point of origin is “set aside”
and the goods enter Canada at reduced duty or perhaps duty free. It
also stated that some Chinese companies are rated as tariff-free by
the Canadian customs “old rulings”, and other Chinese manufacturers
of mattress innerspring units sell their goods to those tariff-free
or duty-reduced Chinese exporting companies before they are sold to
their Canadian customers. Marshall also stated that Chinese
exporters created a new class of innerspring products which
circumvents the Tribunal’s injury finding by creating
“faux-finished mattresses” (mattress innerspring units with a
temporary fabric finish) that correspond to “finished mattresses”
instead of “mattress innerspring units”. Finally, Marshall stated
that Chinese exporters disappear from the CBSA’s and the Tribunal’s
mailing lists, as they change company names repeatedly; therefore,
valuable time is lost before their mattress innerspring units are
identified again as being dumped.
24. Marshall further submitted that it prefers to buy Canadian
and North American mattress innerspring units and that, if the
finding is rescinded, a “Canadian production comeback” would be
25. Primeau stated that comments made in the request for the
interim review are incorrect. According to Primeau, it has been an
important Canadian manufacturer of mattress innerspring units since
1945, with a production capacity available to supply Canadian
market demand, for all of the product range set out in the injury
inquiry. Primeau submitted that a rescission of the finding would
harm the domestic industry of mattress innerspring units.
26. According to Primeau, unfair competition over the last few
years has caused many business closures, and their manufacturing
sector will be forced out of the market completely, should the
finding be rescinded. Primeau submitted that there are at least
three companies in Canada that specialize in the production of
mattress innerspring units, including Alpha and itself.
27. According to Primeau, mattress producers that manufacture
mattress innerspring units for their own internal use could also be
impacted by imports of the subject goods, should their competitors
be supplied with mattress innerspring units at a lesser cost.
28. In its reply submission, Primeau submitted that mattress
innerspring units were found to be dumped, and this fact has not
changed. According to Primeau, the market for mattress innerspring
units is still sensitive and vulnerable to the dumping of the
subject goods. According to Primeau, the Canadian industry has the
available production capacity to supply the domestic demand for
mattress innerspring units.
29. Primeau requested that the Tribunal continue the
30. Subsection 76.01(1) of SIMA states that, at any
time after the making of an order or finding described in any of
sections 3 to 6, the Tribunal may, on its own initiative or at the
request of the Minister of Finance, the President of the Canada
Border Services Agency or any other person or government, conduct
an interim review of (a) the order or finding, or (b) any aspect of
the order or finding. Further, subsection 76.01(3) states that
the Tribunal shall not conduct an interim review at the request of
any person or government unless the person or government satisfies
the Tribunal that the review is warranted.
31. The Tribunal’s first step after receiving a request for an
interim review, therefore, is deciding whether the interim review
is warranted. This decision is usually reached after considering
whether there is a reasonable indication that sufficient new
relevant facts have arisen since the issuance of the existing
finding or order, or that there has been sufficient change in the
circumstances that led to the finding or order in question. In its
request for an interim review, Kingsdown alleged that there had
been a change in the circumstances that led to the finding, that
is, the cessation of production by the principal domestic producer
of like goods at the time of the injury inquiry and that, as a
result, there was no longer any production of like goods sold in
the Canadian merchant market. This allegation was not disputed by
the only party, Simmons, that filed representations concerning
32. After reviewing Kingsdown’s request and reply, and Simmons’
representations, the Tribunal was satisfied that the information
provided a reasonable indication that sufficient new facts had
arisen since the issuance of the finding to warrant the conduct of
an interim review of the finding, pursuant to
paragraph 76.01(1)(a) of SIMA.
33. Kingsdown is asking the Tribunal to rescind its original
finding due to the absence of evidence of Canadian production of
mattress innerspring units for sale in the merchant market. In its
request, Kingsdown submitted that Globe Spring, the most important
Canadian manufacturer of mattress innerspring units at the time of
the injury inquiry, ceased production in October 2011. This was the
basis on which the Tribunal initiated this interim review.
34. Indeed, the evidence confirms that Globe Spring ceased to
produce mattress innerspring units in Canada in October 2011, as
stated by Kingsdown.9 Moreover, the evidence filed by
Kingsdown in this regard was not disputed by the other parties.
However, it is also clear from the evidence that, despite
Globe Spring’s cessation of production, there is still
domestic production of like goods10 and, in particular,
domestic production destined for sale in the merchant
35. Thus, contrary to Kingsdown’s allegations, this is not a
case where there is no longer domestic production. The evidence on
the record indicates that there is at least one domestic producer
of the like goods for the merchant market, namely, Primeau, as well
as at least one domestic producer of like goods destined for
internal consumption, namely, Simmons. Primeau and Simmons were
considered, along with other manufacturers of mattress innerspring
units, to be a constituent part of the domestic industry for the
purpose of the Tribunal’s injury analysis in the injury
inquiry.12 Indeed, Primeau, in its submission to the
Tribunal in this interim review, has identified itself as an
important Canadian manufacturer of like goods, with a production
capacity available to supply the Canadian market demand.
36. Accordingly, the central allegation in Kingsdown’s request
is not borne out by the facts. In these circumstances, the Tribunal
finds that the finding cannot be rescinded on the basis that there
is no longer any domestic production of mattress innerspring units
sold in the Canadian merchant market.
37. The only issue that remains to be considered in this interim
review is whether, in light of the fact that Globe Springs no
longer manufactures like goods, there remains a continuing
justification for the application of anti-dumping duties on the
subject goods. On this issue, Kingsdown essentially argued that
only Globe Spring was found by the Tribunal to have been injured by
the subject goods in the injury inquiry and that, in view of the
recent developments concerning Globe Spring’s situation, there is
no longer sufficient evidence to continue the finding.
38. The Tribunal is unable to accept this argument. The basis
for the application of anti-dumping and/or countervailing duties on
goods is established in the original finding or order. In this
case, contrary to Kingsdown submissions, the finding in the injury
inquiry was the result of a determination of material injury caused
by the dumping of the subject goods to the entire domestic
industry. Indeed, in stating that it considered Globe Spring’s
situation at the time to be a reliable representation of the effect
of the dumped imports on the domestic industry’s performance as a
whole, in the merchant market,13 the Tribunal made it
clear that its injury analysis was not limited to the effect of the
dumped imports on Globe Spring’s production and sales. In other
words, Globe Spring’s performance was used as a representative
proxy for the performance of the domestic industry’s performance as
39. This means that there is an assumption that all Canadian
manufacturers of mattress innerspring units suffered material
injury due to the subject goods, even though the evidence, at the
time, was based on information that related primarily to Globe
Spring. The absence of current domestic production by
Globe Spring does not undo or eliminate the evidence on which
the Tribunal relied in the injury inquiry.
40. The evidence on the record is clear that there is still a
domestic industry that produces mattress innerspring units. There
is no indication that the evidence in the injury inquiry was
incorrect or nonexistent. The purpose of the finding is to protect
the production of like goods from the injury caused by the subject
goods for the entire duration of the finding. The Tribunal finds
that it has not been established, in this interim review, that the
reasons that led the Tribunal to conclude to the existence of
injury to the domestic industry in 2009 are no longer valid, such
as to warrant rescission of the order prior to its expiration.
Moreover, considering that there is currently domestic production,
the Tribunal is not convinced that injury will not continue or
recur if the duties are removed. Therefore, the Tribunal is unable
to conclude that the finding is no longer necessary.
41. For the foregoing reasons, pursuant to paragraph
76.01(5)(a) of SIMA, the Tribunal hereby
continues the finding without amendment.
1 . R.S.C. 1985, c. S-15 [SIMA].
2 . Tribunal Exhibit RD-2011-004-01,
Administrative Record, Vol. 1 at 3-6.
3 . S.O.R./91-499 [Rules].
4 . The Tribunal notes that these are domestic
producers that manufactured mattress innerspring units for the
merchant market only at the time of the injury inquiry. During the
injury inquiry, among those three companies, only Globe Spring was
represented by counsel and present at the hearing.
5 . C. Gaz. 2012.I.4.
6 . Those companies are Literie Giddings,
Marshall Mattress (Marshall) and Park Avenue Furniture; Tribunal
Exhibit RD-2011-004-09.03, Administrative Record, Vol. 1 at 61.
7 . Tribunal Exhibit RD-2011-004-09.03,
Administrative Record, Vol. 1 at 61.
8 . Tribunal Exhibit RD-2011-004-11.01,
Administrative Record, Vol. 1 at 75.
9 . Tribunal Exhibit RD-2011-004-09.03,
Administrative Record, Vol. 1 at 67-69.
10 . Tribunal Exhibit RD-2011-004-04.01,
Administrative Record, Vol. 1 at 21; Tribunal Exhibit
RD-2011-004-09.01, Administrative Record, Vol. 1 at 53.
11 . Tribunal Exhibit RD-2011-004-12.02
(protected), Administrative Record, Vol. 2 at 7-9; Tribunal Exhibit
RD-2011-004-09.04, Administrative Record, Vol. 1 at 71.
12 . See Mattress Innerspring Units
(24 November 2009), NQ-2009-002 (CITT) at para. 56.
13 . Mattress Innerspring Units (24
November 2009), NQ-2009-002 (CITT) at para. 88.