Importers Beware: AD/CVD Scope is More Than Just the Scope Language

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Feb. 19, 2026
By: Austin J. Eighan

Sometimes lost in the barrage of Trump tariffs is the humble old antidumping/countervailing duty (AD/CVD) tariff. This is risky for importers, since AD/CVD are often several times higher than Trump tariffs and are (somehow) even harder to plan for. On February 17, the U.S. Court of Appeals for the Federal Circuit (CAFC) reaffirmed an important point in dealing with AD/CVD that even some savvy importers miss. Namely, that in interpreting the scope of an order, the Department of Commerce has (essentially) unlimited discretion to rely on interpretive materials when construing AD and CVD scope language.

The “scope” provides a narrative description of merchandise subject to the additional duties. This is generally found in Federal Register notices related to the case and appear to be complete on their face. This leads some importers to simply read the scope section of a case and reach a conclusion regarding coverage. The consequences of that conclusion can be dramatic, since AD/CVD regularly reach at least 100% duty levels. Unfortunately, simply reading the scope and reaching a conclusion is also an incomplete analysis.

Although AD/CVD regulations instruct Commerce to frame scopes in general terms, it may supplement that language with descriptions of technical characteristics or specific uses to identify the class or kind of merchandise at issue. This ensures the scope does not inadvertently cover unintended goods. If the text of an AD/CVD order is unclear or ambiguous, importers or other interested parties may submit a request that Commerce issue a ruling on whether a good falls within the scope of an order—a “scope ruling.”

In Magnum Magnetics Corp. v. United States, the dispute arose from a scope ruling pertaining to the AD and CVD Orders on raw flexible magnets from China. Siffron, a U.S. importer, requested a ruling to determine whether its plastic shelf dividers—consisting of a raw flexible magnet bonded with adhesive to a rigid plastic blade in a T- or L-shaped configuration—fall within the scope of the Orders. The Orders define in-scope merchandise as “flexible magnets regardless of shape, color, or packaging…[which] may or may not be fully or partially bonded with paper, plastic, or other material, of any composition and/or color.”

Commerce found that by attaching a raw flexible magnet to a rigid plastic blade, Siffron created a product “substantially different” from the flexible magnets covered by the Orders because the finished article became functionally inflexible and unable to bend or twist without damage. In reaching that conclusion, Commerce relied not only on the plain language of the Orders but also on interpretive sources identified in 19 C.F.R. § 351.225(k)(1)(i) to give meaning to the text. These “(k)(1) sources” included prior scope rulings and language from the U.S. International Trade Commission’s underlying investigation. In particular, Commerce relied on its earlier InterDesign scope ruling, where it determined that magnets “rendered inflexible by attached materials” fall outside the meaning of “flexible magnets.”

Magnum Magnetics, a U.S. producer of flexible magnets, challenged the determination and argued that Commerce impermissibly consulted the (k)(1) sources when the scope language was “plainly unambiguous.” Magnum maintained that Commerce must first find ambiguity before turning to those interpretive sources.

Both the U.S. Court of International Trade and the Court of Appeals for the Federal Circuit rejected that argument. The CAFC found that Commerce’s use of interpretive guidance was within its discretion, as it was based on reasonable analysis and substantial evidence. The court emphasized that there is no requirement in the relevant AD/CVD regulations for Commerce to first determine whether the scope language is clear on its face before turning to the (k)(1) sources. The court also recognized that the plain meaning of a term may shift over time. As such, Commerce may analyze even seemingly clear scope language through the lens of (k)(1) sources to verify scope coverage. However, the court drew a clear boundary: Commerce may not rely on (k)(1) sources to rewrite or expand the scope of an order.

This case serves as a reminder that AD/CVD analysis is very consequential and complicated. Simply relying on the plain language of a scope description is insufficient to understand whether imports are at risk of high and unpredictable AD/CVD assessments. Even when the text appears clear, Commerce retains discretion to look beyond it. If your company has any questions on scope interpretations or would like guidance on how to navigate the AD/CVD process, please reach out to one of our attorneys at Barnes, Richardson & Colburn.