Honey from the People's Republic of China: Final Results and Final Rescission, In Part, of Antidumping Duty Administrative Review, 38873-38881 [E5-3547]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 70, Number 128 (Wednesday, July 6, 2005)]
[Notices]
[Pages 38873-38881]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-3547]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-863]


Honey from the People's Republic of China: Final Results and 
Final Rescission, In Part, of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: On December 27, 2004, the Department published the Preliminary 
Results of the second administrative review of the antidumping duty 
order on honey from the People's Republic of China (``PRC'') (69 FR 
77184). This review covers nine exporters or producer/exporters: (1) 
Zhejiang Native Produce and Animal By-Products Import & Export Group 
Corp. (``Zhejiang''); (2) Shanghai Eswell

[[Page 38874]]

Enterprise Co., Ltd. (``Eswell''); (3) Wuhan Bee Healthy Company, Ltd. 
(``Wuhan Bee''); (4) Jinfu Trading Co., Ltd. (``Jinfu''); (5) Sichuan-
Dujiangyan Dubao Bee Industrial Co., Ltd. (``Dubao''); (6) Inner 
Mongolia Autonomous Region Native Produce and Animal By-Products Import 
& Export Corp. (``Inner Mongolia''); (7) Shanghai Xiuwei International 
Trading Co., Ltd. (``Shanghai Xiuwei''); (8) Shanghai Shinomiel 
International Trade Corporation (``Shanghai Shinomiel''); and (9) 
Kunshan Foreign Trade Company (``Kunshan''), and exports of the subject 
merchandise to the United States during the period December 1, 2002 
through November 30, 2003.
    Based on our analysis of the record, including factual information 
obtained since the Preliminary Results, we have made changes to the 
margin calculations for Zhejiang, Eswell, Wuhan Bee, and Jinfu. Based 
on Dubao's non-cooperation after the Preliminary Results, we have 
applied total adverse facts available to all of Dubao's sales during 
the POR. Therefore, the final results differ from the Preliminary 
Results. See ``Final Results of Review'' section below

EFFECTIVE DATE:  July 6, 2005.

FOR FURTHER INFORMATION CONTACT: Anya Naschak or Kristina Boughton at 
(202) 482-6375 or (202) 482-8173, respectively; AD/CVD Operations, 
Office 9, Import Administration, International Trade Administration, 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Background

    We published in the Federal Register the Preliminary Results of the 
second administrative review on December 27, 2004. See Honey from the 
People's Republic of China: Preliminary Results, Partial Rescission, 
and Extension of Final Results of Second Antidumping Duty 
Administrative Review, 69 FR 77184 (December 27, 2004) (``Preliminary 
Results''). The period of review (``POR'') is December 1, 2002 through 
November 30, 2003.
    Since the Preliminary Results the following events have occurred:
    On January 10, 2005, Dubao informed the Department that it wished 
to withdraw from this administrative review. On January 12, 2005, the 
Department issued a letter informing Dubao that the request to withdraw 
from the review was well after the deadline for submitting such 
requests, and petitioners in this case had not withdrawn their request 
for review. The Department also informed Dubao that, because of Dubao's 
failure to respond to three outstanding supplemental questionnaires and 
the Department's inability to conduct verification of information 
submitted by Dubao, the Department may find Dubao to have failed to 
cooperate to the best of its ability pursuant to section 776(b) of the 
Tariff Act of 1930, as amended (``the Act''), and provided Dubao with 
an additional opportunity to submit the requested information. The 
Department received no response from Dubao.
    From February 28, 2005 through March 4, 2005, the Department 
conducted verification of Wuhan Bee's sales and factors of production 
information at Wuhan Bee's facility in Wuhan. See Memorandum to the 
File from Case Analysts: Verification of U.S. Sales and Factors of 
Production for Respondent Wuhan Bee Healthy Co., Ltd., dated April 14, 
2005 (``Wuhan Bee HM Verification Report'').
    From March 7, 2005 through March 11, 2005, the Department conducted 
verification of Shanghai Eswell's sales and factors of production 
information at Shanghai Eswell's facility in Shanghai, and at Shanghai 
Eswell's unaffiliated producer, Nanjing Lishui Changli Bees Product 
Co., Ltd.'s (``Nanjing Changli''). See Memorandum to the File from Case 
Analysts: Verification of Sales of Shanghai Eswell Enterprise Co., Ltd. 
and of Factors of Production for Nanjing Lishui Changli Bees Product 
Co., Ltd.'s in the Antidumping Duty Administrative Review of Honey from 
the People's Republic of China, dated April 15, 2005 (``Eswell HM 
Verification Report''). From March 24, 2005 to March 25, 2005, the 
Department conducted verification of Shanghai Eswell's and Eswell 
America, Inc.'s (``Eswell America'') (collectively ``Eswell'') sales 
information at Shanghai Eswell's claimed U.S. affiliate, Eswell 
America, in Los Angeles. See Memorandum to the File from Case Analysts: 
Verification of Sales of Eswell America, Inc. in the Antidumping Duty 
Administrative Review of Honey from the People's Republic of China, 
dated April 15, 2005 (``Eswell US Verification Report'').
    From April 27, 2005 through April 29, 2005, the Department 
conducted verification of Wuhan Bee's claimed U.S. affiliate in 
Wisconsin. See Memorandum to the File from Carrie Blozy and Kristina 
Boughton: Verification of U.S. Sales and Further Manufacturing Expenses 
for Respondent Wuhan Bee Healthy Co., Ltd (Wuhan Bee), as reported by 
Presstek Inc., Pure Sweet Honey Farm Inc., and Pure Food Ingredients, 
dated May 6, 2005 (``Wuhan Bee U.S. Verification Report'').
    We invited parties to comment on our Preliminary Results. We 
received a case brief from respondents Zhejiang, Eswell, Wuhan Bee, and 
Jinfu on May 4, 2005. We also received a case brief from the American 
Honey Producers Association and the Sioux Honey Association 
(collectively, ``petitioners''), on May 4, 2005. The Department 
rejected respondents' case brief on May 5, 2005, and May 9, 2005, 
because the brief contained untimely submitted new information. 
Respondents refilled their case brief on May 10, 2005. We received a 
rebuttal brief from petitioners on May 13, 2005. The Department also 
requested comment on a number of issues, including the verification of 
Wuhan Bee's claimed U.S. affiliate, the methodology for constructing an 
export price (``EP'') database for Wuhan Bee and Shanghai Eswell, 
additional information with respect to the surrogate value of raw 
honey, and on calculating a per-unit assessment and cash deposit rate 
for the final results. We received comments from parties on each of 
these issues.
    On June 3, 2005, we held a public hearing in this review. On June 
X, 2005, the Department submitted a letter to respondents and 
petitioners requesting comments on its proposed redaction of certain 
sur-rebuttal comments made by respondents in the public hearing. We 
received comments from parties on these proposed redactions on June 20, 
2005.

Scope of the Order

    The products covered by this order are natural honey, artificial 
honey containing more than 50 percent natural honey by weight, 
preparations of natural honey containing more than 50 percent natural 
honey by weight, and flavored honey. The subject merchandise includes 
all grades and colors of honey whether in liquid, creamed, comb, cut 
comb, or chunk form, and whether packaged for retail or in bulk form.
    The merchandise subject to this order is currently classifiable 
under subheadings 0409.00.00, 1702.90.90, and 2106.90.99 of the 
Harmonized Tariff Schedule of the United States (``HTSUS''). Although 
the HTSUS subheadings are provided for convenience and customs 
purposes, the Department's written description of the merchandise under 
order is dispositive.

Partial Rescission of Administrative Review

    In the Preliminary Results, the Department issued a notice of 
intent to rescind this administrative review with

[[Page 38875]]

respect to Kunshan, as we found that there were no entries of subject 
merchandise during the POR. See Preliminary Results, 69 FR at 77186. 
The Department received no comments on this issue. Therefore, the 
Department is rescinding this administrative review with respect to 
Kunshan.

Separate Rates

    Zhejiang, Eswell, Wuhan Bee, Jinfu, and Dubao have requested 
separate, company-specific antidumping duty rates. In our Preliminary 
Results, we found that Zhejiang, Eswell, Wuhan Bee, Jinfu, and Dubao 
had met the criteria for the application of a separate antidumping duty 
rate. See Preliminary Results. Also in the Preliminary Results, we 
found that Inner Mongolia, Shanghai Xiuwei, and Shanghai Shinomiel did 
not respond in a complete and timely manner to the Department's 
requests for information, and hence do not qualify for a separate rate. 
The Department did not receive comments on this issue prior to these 
final results. See also ``The PRC-Wide Rate and Application of Facts 
Otherwise Available'' section below.
    Since the Preliminary Results, the Department requested additional 
information from Dubao and stated its intent to complete a verification 
of Dubao. See Preliminary Results, 69 FR 77186. The Department was 
unable to verify the information submitted by Dubao because Dubao 
withdrew from this administrative review, and therefore Dubao is 
subject to adverse facts available and shall be deemed to be part of 
the PRC-wide entity. See The PRC-Wide Rate and Application of Adverse 
Facts Available section below.
    We have not received any information since the Preliminary Results 
with respect to Zhejiang, Eswell, Wuhan Bee, and Jinfu which would 
warrant reconsideration of our separate-rates determination with 
respect to these companies. Therefore, we have assigned individual 
dumping margins to Zhejiang, Eswell, Wuhan Bee, and Jinfu for this 
review period.

Analysis of Comments Received

    All issues raised in the briefs are addressed in the Issues and 
Decision Memorandum for the Final Results in the 2002/2003 
Administrative Review of Honey from the People's Republic of China from 
Barbara E. Tillman, Acting Deputy Assistant Secretary to Joseph A. 
Spetrini, Acting Assistant Secretary, dated June 27, 2005 (``Issues and 
Decision Memorandum''), which is hereby adopted by this notice. A list 
of the issues raised, all of which are in the Issues and Decision 
Memorandum, is attached to this notice as Appendix I. Parties can find 
a complete discussion of all issues raised in the briefs and the 
corresponding recommendations in this public memorandum, which is on 
file in the Central Records Unit (``CRU''), room B-099 of the Herbert 
H. Hoover Building. In addition, a complete version of the Issues and 
Decision Memorandum can be accessed directly on the Web at https://
ia.ita.doc.gov/frn/. The paper copy and electronic version of 
the Issues and Decision Memorandum are identical in content.

Shipments by Wuhan Bee

    During the POR, the Department discovered a discrepancy between 
Wuhan Bee's reported U.S. sales database quantity and value and U.S. 
Customs and Border Protection (``CBP'') information. See Supplemental 
Questionnaire to Wuhan Bee from the Department of Commerce, dated 
January 6, 2005, and two memorandums to the file, dated January 6, 
2005, and May 11, 2005. The CBP information indicated that Wuhan Bee 
appeared to have entries of subject merchandise into the United States 
during the POR that were not accounted for in its reported U.S sales 
database.
    The Department took several steps with regard to this issue. First, 
the Department requested the entry documents associated with these 
sales from CBP and noted discrepancies between these invoices and Wuhan 
Bee's invoices. See ``Memorandum to the File: Wuhan Bee Healthy Co., 
Ltd. (Wuhan Bee) Invoices,'' dated June 10, 2005. Next, the Department 
conducted extensive completeness tests during Wuhan Bee's verification 
in China, in addition to standard verification procedures. In addition 
to conducting a reconciliation of Wuhan Bee's total reported sales 
value and quantity during the POR to its financial records, the 
Department also reconciled the reported sales values and total volume 
of shipments reported to the Department to all bills of lading, VAT 
receipts, raw material withdrawals, raw material inputs, and payment 
deposits. The Department did not find any evidence, based on these 
exhaustive completeness tests, that the additional sales had been made 
by Wuhan Bee.
    Finally, the Department extensively interviewed company officials, 
at the verifications in both China and Wisconsin, regarding the 
discrepancy and the steps Wuhan Bee had taken regarding this matter. 
Company officials claimed that they reported these sales to CBP as 
fraudulent entries, and that they did not produce or ship these 
entries. They also outlined the steps they took with the U.S. Food and 
Drug Administration (``FDA'') and CBP regarding the matter, e.g., 
providing a list of all of Wuhan Bee's legitimate entries during a 
certain time period at FDA's behest, meeting with FDA personnel, and 
hiring a law firm to handle the matter with the CBP. Company officials 
said that, to their knowledge, however, there had yet to be a 
resolution to this matter.\1\
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    \1\See Wuhan Bee U.S. Verification Report.
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    The Department was unable to find any evidence that Wuhan Bee or 
its claimed affiliates, Presstek Inc. (``Presstek''), Pure Sweet Honey 
Farm Inc. (``PSH''), and Pure Food Ingredients (``PFI''), produced, 
shipped, invoiced, or received payment for these additional entries. 
Therefore, for these final results, the Department finds that these 
sales were not in fact Wuhan Bee sales and will instruct the CBP to 
liquidate these entries at the PRC-wide rate.

Changes Since the Preliminary Results

    Based on the comments received from the interested parties, we have 
made changes to the margin calculation for Zhejiang, Eswell, Wuhan Bee, 
and Jinfu. For a discussion of these changes, See the Issues and 
Decision Memorandum. For the final results, we have updated our 
selection of a surrogate value for raw honey, based on new information 
placed on the record following the Preliminary Results. See the Issues 
and Decision Memorandum at Comment 1.
    For the final results, we revised our calculation of surrogate 
financial ratios for factory overhead, selling, general and 
administrative expenses (``SG&A''), and profit, to use the more 
contemporaneous 2003/2004 annual report from the Mahabaleshwar Honey 
Producers Cooperative (``MHPC''), and applied these new ratios in our 
margin calculations. See the Issues and Decision Memorandum at Comment 
2 and 3.
    We revised our calculation of surrogate home market brokerage and 
handling expenses to be consistent with recent Department 
determinations. See the Issues and Decision Memorandum at Comment 4.
    We revised our calculation of CEP profit for Zhejiang, and Shanghai 
Eswell to use the surrogate profit ratio from MHPC's financial 
statements in accordance with the Department's practice. See, e.g., the 
Issues and Decision Memorandum at Comment 5.
    We revised our classification of certain of Wuhan Bee's sales to 
Presstek from constructed export price (``CEP'') to export price 
(``EP''). See the Issues

[[Page 38876]]

and Decision Memorandum at Comment 11, and below under ``Wuhan Bee 
Affiliation.'' For the remaining CEP sales by Wuhan Bee to Presstek, 
the Department has applied adverse facts available. See the Issues and 
Decision Memorandum at Comment 13, and ``The PRC-Wide Rate and 
Application of Facts Otherwise Available'' section, below.

Affiliation

    With respect to Wuhan Bee, the Department has reversed its finding 
in the Preliminary Results that Wuhan Bee and its U.S. reseller were 
affiliated parties for the entire POR. Wuhan Bee has claimed that it is 
affiliated with Presstek, PSH, and PFI within the meaning of section 
771(33) of the Act. Section 771(33) of the Act states that affiliated 
persons include: (A) members of a family, including brothers and 
sisters (whether by the whole or half blood), spouse, ancestors, and 
lineal descendants, (B) any officer or director of an organization and 
such organization, (C) partners, (D) employer and employee, (E) any 
person directly or indirectly owning, controlling, or holding with 
power to vote, five percent or more of the outstanding voting stock or 
shares of any organization and such organization, (F) two or more 
persons directly or indirectly controlling, controlled by, or under 
common control with, any person, (G) any person who controls any other 
person and such other person. For purposes of this paragraph, a person 
shall be considered to control another person if the person is legally 
or operationally in a position to exercise restraint or direction over 
the other person. To find affiliation between companies, the Department 
must find that at least one of the criteria listed above is applicable 
to the respondents.
    Although no party in this case is questioning whether or not Wuhan 
Bee was in fact affiliated with Presstek, PSH, and PFI at some point 
during the POR within the meaning of Section 771(33), we note that the 
effective date of this affiliation is in question, and is significant 
to this proceeding for purposes of determining whether Wuhan Bee's U.S. 
sales made on various dates should be treated as ``export price'' sales 
or ``constructed export price'' sales. Wuhan Bee claims that it was 
affiliated with Presstek, PSH, and PFI throughout the entire POR, such 
that all of its POR sales should be treated as CEP sales. In support of 
this contention, Wuhan Bee has provided documentation it claims 
establishes that it had a close supplier relationship with Presstek, 
PSH, and PFI during the entire POR and that this close supplier 
relationship is sufficient to find affiliation between the parties. 
Petitioners claim that, if the Department were to find Wuhan Bee and 
Presstek, PSH, and PFI affiliated at any point during the POR, then the 
date of affiliation should be September 30, 2003, when Wuhan Bee 
recorded the ownership interest purchase by Presstek, PSH, and PFI's 
president in its normal books and records.
    In considering for purposes of these final results whether Wuhan 
Bee was affiliated with Presstek, PSH, and PFI under section 771(33) of 
the Act, we analyzed all information on the record regarding the 
possible affiliations between PSH and Presstek, between Wuhan Bee and 
Presstek, and between Wuhan Bee and PSH. In particular, we considered 
whether Wuhan Bee and Presstek were affiliated from the beginning of 
the POR and whether the investment of the individual who was the 
president of Presstek, PSH, and PFI which led to that individual's 
board membership in Wuhan Bee resulted in a common control relationship 
between the parties at any time during the POR. See ``Memorandum to 
James C. Doyle: Administrative Review of the Antidumping Duty Order on 
Honey from the People's Republic of China (PRC): Analysis of the 
Relationship and Treatment of Sales between Wuhan Bee Healthy Co., Ltd. 
and Presstek Inc., Pure Sweet Honey Farm Inc., and Pure Foods 
Ingredients, Inc.'' (June 27, 2005) (``Wuhan Bee Affiliation Memo'') 
and accompanying Issue and Decision Memo at Comment 11.
    Based on an analysis of the information on the record, the 
Department has determined that Wuhan Bee and Presstek, PSH, and PFI 
were not ``affiliated'' within the meaning of sections 771(33)(E) or 
(G) during the POR, and that they only became affiliated within the 
meaning of section 771(33)(F) of the Act when the Wuhan Bee board 
membership of the president of Presstek, PSH, and PFI became effective 
on July 20, 2003. At that point, Wuhan Bee, Presstek, PSH, and PFI came 
under the common control of that individual, and thus became affiliated 
with each other. Therefore, the Department has determined that, for 
purposes of these final results, all sales between Wuhan Bee and 
Presstek prior to July 20, 2003, will be examined on an EP basis, while 
all sales on or after this date will be examined on a CEP basis. See 
``The PRC-Wide Rate and Application of Facts Otherwise Available'' 
section of this notice and accompanying Issue and Decision Memo at 
Comment 11 and 12 for further discussion.

The PRC-Wide Rate and Application of Facts Otherwise Available

    As explained above, Eswell, Jinfu, Wuhan Bee, and Zhejiang 
(collectively ``separate rate companies'') each have obtained a 
separate rate. The PRC-wide rate applies to all entries of subject 
merchandise except for entries from PRC producers/exporters that have 
their own calculated rate. See ``Separate Rates'' section above.

Inner Mongolia, Shanghai Xiuwei, and Shanghai Shinomiel:

    The Department did not receive comments on its preliminary 
determination to apply adverse facts available (``AFA'') to the PRC-
wide entity (including Inner Mongolia, Shanghai Xiuwei, and Shanghai 
Shinomiel). Therefore, we have not altered our decision to apply total 
AFA to the PRC-wide entity (including Inner Mongolia, Shanghai Xiuwei, 
and Shanghai Shinomiel) for these final results, in accordance with 
sections 776(a)(2)(A) and (B), as well as section 776(b) of the Tariff 
Act of 1930, as amended (``the Act''). For a complete discussion of the 
Department's decision to apply total AFA for Inner Mongolia, Shanghai 
Xiuwei, and Shanghai Shinomiel, See Preliminary Results, 69 FR at 
77188-77190. Furthermore, as stated in the Preliminary Results, the 
Department determined that, because Inner Mongolia, Shanghai Xiuwei, 
and Shanghai Shinomiel did not respond to our requests for information 
regarding separate rates, these companies do not merit separate rates. 
See Separate Rates section, above.

Facts Available:

    Section 776(a)(2) of the Act provides that, if an interested party 
or any other person: (A) withholds information that has been requested 
by the administering authority; (B) fails to provide such information 
by the deadlines for the submission of the information or in the form 
and manner requested, subject to subsections (c)(1) and (e) of section 
782; (C) significantly impedes a proceeding under this title; or (D) 
provides such information but the information cannot be verified as 
provided in section 782(i), the Department shall, subject to section 
782(d) of the Act, use the facts otherwise available in reaching the 
applicable determination under this title. Where the Department 
determines that a response to a request for information does not comply 
with the request, section 782(d) of the Act provides that the 
Department shall promptly inform the party submitting the response of 
the nature of the

[[Page 38877]]

deficiency and shall, to the extent practicable, provide that party 
with an opportunity to remedy or explain the deficiency. Section 782(d) 
further states that, if the party submits further information that is 
unsatisfactory or untimely, the administering authority may, subject to 
subsection (e), disregard all or part of the original and subsequent 
responses. Section 782(e) of the Act provides that the Department shall 
not decline to consider information that is submitted by an interested 
party and is necessary to the determination but does not meet all the 
applicable requirements established by the administering authority if 
(1) the information is submitted by the deadline established for its 
submission, (2) the information can be verified, (3) the information is 
not so incomplete that it cannot serve as a reliable basis for reaching 
the applicable determination, (4) the interested party has demonstrated 
that it acted to the best of its ability in providing the information 
and meeting the requirements established by the administering authority 
with respect to the information, and (5) the information can be used 
without undue difficulties.

Wuhan Bee:

    Wuhan Bee responded to the Department's original questionnaire and 
several supplemental questionnaires, reporting its sales on a CEP 
basis, and the Department calculated a margin using CEP methodology for 
Wuhan Bee in the Preliminary Results, based on Wuhan Bee's claimed 
affiliation with Presstek, PSH, and PFI. However, based on the findings 
discussed above under ``Affiliation,'' in the Wuhan Affiliation Memo, 
and the Issues and Decision Memorandum at Comment 11, the Department 
has determined for these final results that Wuhan Bee did not become 
affiliated with Presstek and PSH until July 20, 2003, eight months into 
the POR. Based on these findings, the Department has classified all of 
Wuhan Bee's entered sales prior to the date of affiliation (July 20, 
2003) as EP transactions. The Department has continued to classify all 
Wuhan Bee invoiced sales dated between July 20, 2003, and November 30, 
2003, (the end of the POR) as CEP transactions.
    Because Wuhan Bee provided a CEP sales database in response to the 
Department's questionnaire, however, the record does not contain an EP 
sales database that can be used in calculating a margin for the sales 
now classified as EP sales. Therefore, the Department finds that it is 
necessary to use facts available in determining the margin for these 
sales, in accordance with section 776(a)(1) of the Act. Moreover, 
because the Department made its determination that the sales should be 
accorded EP treatment after the Preliminary Results, it was not 
practicable for the Department to request that Wuhan Bee provide an EP 
sales database so late in the review and after verification; thus, 
section 782(d) of the Act does not apply.
    As noted above, section 782(e) of the Act provides that the 
Department shall not decline to consider information that is submitted 
by an interested party and is necessary to the determination but does 
not meet all the applicable requirements established by the 
administering authority if (1) the information is submitted by the 
deadline established for its submission, (2) the information can be 
verified, (3) the information is not so incomplete that it cannot serve 
as a reliable basis for reaching the applicable determination, (4) the 
interested party has demonstrated that it acted to the best of its 
ability in providing the information and meeting the requirements 
established by the administering authority with respect to the 
information, and (5) the information can be used without undue 
difficulties. During its verification of Wuhan Bee, the Department 
collected information on invoices for all entries of subject 
merchandise made by Wuhan Bee into the United States during the POR. 
See Wuhan Bee HM Verification Report. Therefore, as facts otherwise 
available, and in accordance with section 782(e) of the Act, as a proxy 
for an EP U.S. sales database, the Department has determined to use the 
fully verified invoice price and quantity data for sales from Wuhan Bee 
to Presstek based on the invoice list collected at verification. 
Interested parties in this review commented on this methodology as 
discussed in the Issues and Decision Memorandum at Comment 12, and 
agree with the Department's proposed methodology. See also, Wuhan Bee 
Final Analysis Memo.
    The invoiced sales dated on or after affiliation began are 
appropriately classified as CEP sales. However, the Department has 
determined that it cannot rely on Wuhan Bee's reported CEP sales 
databases for the period after July 20, 2003, because it was unable to 
verify significant portions of the CEP data submitted by Wuhan Bee. 
Therefore, pursuant to section 776(a)(2)(D) of the Act, the Department 
has determined to use the facts otherwise available in determining the 
margins for Wuhan Bee's CEP sales.
    At the verification of Presstek, PSH, and PFI in Wisconsin, the 
Department was unable to verify the quantity of subject merchandise 
sold by PSH to unaffiliated parties because of pervasive errors in 
Wuhan Bee's reported blend ratios. See The Issues and Decision 
Memorandum at Comment 13 for a further discussion of the Department's 
verification findings. The blend ratios represent the percentage of 
Chinese honey in the total honey blend that was sold to PSH's U.S. 
customers. Wuhan Bee relied on its blend ratios to determine whether an 
invoice line item represented a sale of subject merchandise. Wuhan Bee 
itself notes in its December 3, 2004, submission that ``1 MT of Chinese 
honey may be imported and then split into 5 portions of 20% Chinese 
honey, blended with non-subject merchandise, and resold under 5 
invoices.'' Wuhan Bee further explains that, in this example, ``1 MT of 
Chinese honey is blended into 5 batches at a 20% blend prior to resale 
{and{time}  only 20% of the honey that was sold was Chinese.'' See 
Comments on Preliminary Results Calculation Methodology for Wuhan Bee, 
dated December 3, 2004. Therefore, without accurate blend ratios, the 
Department has no way of determining the quantity of subject 
merchandise included in a given sale. Respondent admitted for the first 
time at the CEP verification that the underlying assumptions it used to 
report PSH's sales of subject merchandise were faulty, and that 
contrary to its statements prior to verification it was never able to 
report ``a one-to-one ratio relationship'' between the quantity of 
subject merchandise blended to produce each product listed as a 
separate line item on the PSH invoice and the quantity of subject 
merchandise sold under that line item. See Respondent's Refiling of 
Wuhan Bee's Case Brief, dated May 24, 2005, at 18. The Department gave 
Wuhan Bee ample opportunity prior to verification to modify its blend 
ratios or explain any problems it had with these data (issuing 
supplemental questionnaires on the CEP sales and further manufacturing 
expenses associated with the blending operations on October 20, 2004, 
and accepting Wuhan Bee's comments regarding the blend ratios on March 
15, 2005), but Wuhan Bee did not approach the Department with these 
concerns prior to verification. Moreover, as detailed in the Issues and 
Decision Memo at Comment 13, the Department was also unable to verify 
other portions of Wuhan Bee's sales database during the CEP 
verification. See The Issues and Decision Memorandum at Comment 13 for 
further discussion of this issue.
    Pursuant to section 776(a)(2)(D) of the Act, the Department may use 
facts

[[Page 38878]]

otherwise available when a party submits information that cannot be 
verified as provided in section 782(i). In addition, in accordance with 
section 782(d), the Department gave Wuhan Bee several opportunities to 
address problems it may have had in substantiating its blend ratios 
based on the books and records maintained in its normal course of 
business (as discussed in detail in the Issues and Decision Memo at 
Comment 13). The Department therefore finds, pursuant to section 
776(a)(2)(C) of the Act, that Wuhan Bee has significantly impeded the 
Department's ability to conduct this proceeding with respect to Wuhan 
Bee's CEP sales by failing to submit accurate data. Therefore, the 
application of facts available is warranted with respect to Wuhan Bee's 
reported CEP sales.

Dubao:

    Dubao responded to the Department's original questionnaire and 
several supplemental questionnaires, and the Department calculated a 
company-specific margin for Dubao in the Preliminary Results. In the 
Preliminary Results the Department stated its intent to verify the 
information submitted by Dubao. See Preliminary Results 69 FR at 77186. 
In addition, as stated in the ``Background'' section of this notice, 
the Department requested additional information from Dubao on January 
3, 2005, due to ``concerns regarding the status of Dubao's relationship 
with its customers, the status of its customers as legitimate importers 
of record, and when and how Dubao received payment for its sales,'' as 
noted in the Preliminary Results, Id. at 77191 and in the Proprietary 
Analysis Memorandum to the File from Anya Naschak, Case Analyst, dated 
December 15, 2004. This supplemental questionnaire included four 
questions regarding returns of Dubao's merchandise, how and from whom 
Dubao received payment from its customers, and inconsistencies 
contained in Dubao's response with respect to its customers. This 
information was critical to the Department's analysis of the accuracy 
and veracity of Dubao's responses for the final results this 
administrative review, and was required to be submitted to the 
Department prior to its verification of Dubao's responses at its 
facilities in Baoji and Dujiangyan, PRC. In addition, this supplemental 
questionnaire included questions that the Department requested Dubao 
forward to its bank regarding the disposition of funds related to 
Dubao's sales. The Department also issued questionnaires to Dubao's 
customers, containing seventeen questions related to their purchases of 
subject merchandise from Dubao.
    Despite providing Dubao with ample time to collect the requested 
information, the Department did not receive any of the requested 
information from Dubao. After the issuance of these questionnaires, the 
Department received a letter from Dubao withdrawing from this 
administrative review. See Letter from Dubao dated January 10, 2005 
(``Dubao Withdrawal Letter''). The Department issued a letter to Dubao 
on January 12, 2005, in which it provided Dubao with an additional 
opportunity to respond to the Department's request for information, 
informing Dubao that, because its request to withdraw from the review 
had come in well after the deadline for making such requests, and 
because petitioners had not withdrawn their request for an 
administrative review, the Department would be proceeding with this 
administrative review with respect to Dubao. See Letter from James C. 
Doyle, Office Director, to Dubao, dated January 12, 2005. In this 
letter the Department noted that, because of Dubao's failure to respond 
to the Department's supplemental questionnaire and the Department's 
inability to conduct verification of the information submitted by Dubao 
to date pursuant to section 782(i)(2) of the Act, the Department might 
find Dubao to have failed to cooperate by not acting to the best of its 
ability, pursuant to section 776(b) of the Act.
    The Department provided Dubao with another opportunity to provide 
the requested information, which was critical to the Department's 
analysis for these final results. Dubao again failed to provide the 
information requested, and did not respond to the Department's January 
12, 2005, letter. Although the Department supplied Dubao with numerous 
opportunities to respond to the Department's additional requests for 
information, Dubao refused to submit any information in response to 
these supplemental questionnaires, did not permit verification, and 
withdrew from this administrative review. The Department therefore 
finds, pursuant to section 776(a)(2)(A), (B), (C), and (D) of the Act, 
that Dubao has repeatedly withheld information requested by the 
Department, failed to timely provide requested information, 
significantly impeded the Department's ability to conduct this 
proceeding, and, by withdrawing from the review, prevented the 
verification of the information it had earlier provided. Therefore, the 
application of facts available is warranted with respect to Dubao.

Application of an Adverse Inference:

    Section 776(b) of the Act provides that, in selecting from among 
the facts available, the Department may use an inference that is 
adverse to the interests of the respondent if it determines that a 
party has failed to cooperate to the best of its ability. Adverse 
inferences are appropriate ``to ensure that the party does not obtain a 
more favorable result by failing to cooperate than if it had cooperated 
fully.'' See Statement of Administrative Action (``SAA'') accompanying 
the URAA, H. Doc. No. 316, 103d Cong., 2d Session at 870 (1994). In 
determining whether a respondent has failed to cooperate to the best of 
its ability, the Department need not make a determination regarding the 
willfulness of a respondent's conduct. See Nippon Steel Corp. v. United 
States, 337 F. 3d 1373, 1382-1393 (Fed. Cir. 2003) (``Nippon Steel''). 
Furthermore, ``an affirmative finding of bad faith on the part of the 
respondent is not required before the Department may make an adverse 
inference.'' Antidumping Duties; Countervailing Duties: Final Rule, 62 
FR 27296, 27340 (May 19, 1997). Instead, the courts have made clear 
that the Department must articulate its reasons for concluding that a 
party failed to cooperate to the best of its ability, and explain why 
the missing information is significant to the review. Id.
    In determining whether a party failed to cooperate to the best of 
its ability, the Department considers whether a party could comply with 
the request for information, and whether a party paid insufficient 
attention to its statutory duties. See Tung Mung Dev. Co. v. United 
States, 223 F. Supp. 2d 1336, 1342 (August 6, 2002). Furthermore, the 
Department also considers the accuracy and completeness of submitted 
information, and whether the respondent has hindered the calculation of 
accurate dumping margins. See Certain Welded Carbon Steel Pipes and 
Tubes from Thailand: Final Results of Antidumping Duty Administrative 
Review, 62 FR 53808, 53819-53820 (October 16, 1997).
    The United States Court of Appeals has held that, if a respondent 
``fails to provide {requested{time}  information by the deadlines for 
submission,'' Commerce shall fill in the gaps with ``facts otherwise 
available.'' The focus of section 776(a) of the Act is respondent's 
failure to provide information. The reason for the failure is of no 
moment. As a separate matter, section 776(b) of the Act permits 
Commerce to ``use an inference that is adverse to the interests of {a 
respondent{time}  in selecting from

[[Page 38879]]

among the facts otherwise available,'' only if Commerce makes the 
separate determination that the respondent ``has failed to cooperate by 
not acting to the best of its ability to comply.'' The focus of 776(b) 
of the Act is respondent's failure to cooperate to the best of its 
ability, not its failure to provide requested information. See Nippon 
Steel, 337 F. 3d at 1382.
    In Nippon Steel, the Federal Circuit held that ``the statutory 
mandate that a respondent act to the 'best of its ability' requires the 
respondent to do the maximum it is able to do.'' See Nippon Steel, 337 
F.3d at 1382.
    An adverse inference may include reliance on information derived 
from the petition, the final determination in the investigation, any 
previous review, or any other information placed on the record. See 
section 776(b) of the Act. It is the Department's practice to assign 
the highest rate from any segment of a proceeding as total adverse 
facts available when a respondent fails to cooperate to the best of its 
ability. See, e.g., Stainless Steel Plate in Coils from Taiwan; 
Preliminary Results and Rescission in Part of Antidumping Duty 
Administrative Review, 67 FR 5789 (February 7, 2002) (``Consistent with 
Department practice in cases where a respondent fails to cooperate to 
the best of its ability, and in keeping with section 776(b)(3) of the 
Act, as adverse facts available, we have applied a margin based on the 
highest margin from any prior segment of the proceeding.'').

Wuhan Bee

    Pursuant to Section 776(b), the Department finds that Wuhan Bee has 
failed to cooperate to the best of its ability with regard to its 
reported CEP data. The court has consistently found that it is a 
respondent's responsibility to build an accurate record, as the 
information necessary to calculate accurate margins is in the sole 
possession of respondents. See Mannesmanrohren-Werke AG v. United 
States, 120 F. Supp. 2d 1075 (CIT 2000). In addition, in Nippon Steel, 
337 F. 3d at 1382, the court stated that ``an adverse inference may not 
be drawn merely from a failure to respond, but only under circumstances 
in which it is reasonable for Commerce to expect that more forthcoming 
responses should have been made.'' In the instant case, Wuhan Bee had 
ample opportunity to inform the Department of problems it may have 
encountered in reporting accurate blend ratios. Moreover, as late into 
the proceeding as March 15, 2005, it claimed that the reported ratios 
were accurate and reported based on Presstek/PSH's books and records, 
and thus Wuhan Bee impeded the Department's ability to assist Wuhan Bee 
in finding a means to report accurate blend ratio data.
    At verification, the Department discovered that the blend ratios 
could not be verified using data maintained in their normal books and 
records, and only then did respondent admit that it had reported 
inaccurate blend ratios. The blend ratios are essential to the 
calculation of a dumping margin because the blend ratios determine 
whether a particular sale of honey is of subject or non-subject 
merchandise. Without confidence in these data, we cannot accurately say 
whether all U.S. sales of subject merchandise were reported and, within 
individual sales, whether the correct quantity of subject merchandise 
was reported.
    Wuhan Bee could have informed the Department at the onset of this 
administrative review that it was having difficulty constructing a 
complete, accurate database based on the books and records of Presstek/
PSH. Wuhan Bee failed to do so at any point in this proceeding, prior 
to the Department's discoveries at verification. Wuhan Bee therefore 
failed to do the maximum it was able to do, consistent with Nippon 
Steel.
    Therefore, pursuant to section 776(b) of the Act, we find that 
Wuhan Bee failed to act to the best of its ability with respect to its 
CEP sales; we therefore find it appropriate to use an inference that is 
adverse to the interests of Wuhan Bee in selecting from among the facts 
otherwise available with respect to the valuation of those CEP sales. 
By doing so, we ensure that the companies that fail to cooperate will 
not obtain a more favorable result by failing to cooperate than had 
they cooperated fully in this review. In accordance with the 
Department's practice, we have assigned the rate of 183.80 percent, as 
adverse facts available, to the portion of Wuhan Bee's entries during 
the POR that were entered and sold on a CEP basis through PSH. Because 
we cannot rely on the reported CEP sales quantity (since we have found 
the quantity data to be unreliable), we have used the quantity of honey 
invoiced from Wuhan Bee to Presstek from July 17, 2003 through November 
30, 2003, as a proxy for the total quantity of subject merchandise sold 
by Presstek to unaffiliated customers during this period. See below for 
a discussion of the probative value of the 183.80 percent rate.

Dubao/PRC-Wide Entity

    As discussed above, Dubao is appropriately considered to be part of 
the PRC-wide entity because its separate rate eligibility could not be 
verified. Furthermore, because the PRC-wide entity did not provide 
information necessary to the instant proceeding, it is necessary that 
we review the PRC-wide entity. In doing so, we note that Section 
776(a)(1) of the Act mandates that the Department use the facts 
available if necessary information is not available on the record of an 
antidumping proceeding. In addition, we find that an element of the 
PRC-wide entity (Dubao) did not respond to our requests for 
information, the necessary information was not provided, that the 
information that was provided was unable to be verified, and an element 
of the PRC-wide entity (Dubao) has failed to act to the best of its 
ability in providing the requested information. Therefore, we find it 
necessary, under section 776(a)(2) of the Act, to continue to use facts 
otherwise available as the basis for the final results of this review 
for the PRC-wide entity.
    Pursuant to section 776(b) of the Act, we find that the PRC-wide 
entity failed to cooperate by not acting to the best of its ability to 
comply with requests for information. As noted above, an element of the 
PRC-wide entity (Dubao) informed the Department that it would not 
participate further in this review, and did not provide any of the 
requested information, despite repeated requests that it do so. This 
information was in the sole possession of the respondents, and could 
not be obtained otherwise. Thus, because the PRC-wide entity refused to 
participate fully in this proceeding, we find it appropriate to use an 
inference that is adverse to the interests of the PRC-wide entity in 
selecting from among the facts otherwise available. By doing so, we 
ensure that the companies that are part of the PRC-wide entity will not 
obtain a more favorable result by failing to cooperate than had they 
cooperated fully in this review.
    As above stated, the PRC-wide entity (including Dubao, Shanghai 
Xiuwei, Inner Mongolia, and Shanghai Shinomiel) did not respond to our 
requests for information or otherwise submitted unreliable information. 
Because the PRC-wide entity did not respond to our request for 
information or otherwise submitted unreliable information, we find it 
necessary, under sections 776(a)(2) and 776(b) of the Act, to use 
adverse facts available as the basis for these final results of review 
for the PRC-wide entity. In accordance with the Department's practice, 
we have assigned to the PRC-wide entity (including Dubao, Inner 
Mongolia, Shanghai Xiuwei, Shanghai Shinomiel,

[[Page 38880]]

and Dubao) the rate of 183.80 percent as AFA. See, e.g., Rescission of 
Second New Shipper Review and Final Results and Partial Rescission of 
First Antidumping Duty Administrative Review: Brake Rotors from the 
People's Republic of China, 64 FR 61581, 61584 (November 12, 1999). In 
selecting a rate for adverse facts available, the Department selects a 
rate that is sufficiently adverse ``as to effectuate the purpose of the 
facts available rule to induce respondents to provide the Department 
with complete and accurate information in a timely manner.'' See Final 
Determination of Sales at Less Than Fair Value: Static Random Access 
Memory Semiconductors from Taiwan, 63 FR 8909, 8932 (February 23, 
1998). This rate is the highest dumping margin from any segment of this 
proceeding and was established in the less-than-fair-value 
investigation based on information contained in the petition, and 
corroborated in the final results of the first administrative review. 
See e.g., Notice of Final Determination of Sales at Less Than Fair 
Value; Honey from the PRC, 66 FR 50608 (October 4, 2001); Honey from 
the People's Republic of China: Preliminary Results of First 
Antidumping Duty Administrative Review, 68 FR 69988 (December 16, 
2003); and reinforced in Honey from the People's Republic of China: 
Final Results of First Antidumping Duty Administrative Review, 69 FR 
24128 (May 3, 2004). For the reasons stated in the Preliminary Results, 
69 FR 77190, the Department continues to find this rate to be both 
reliable and relevant, and, therefore, to have probative value in 
accordance with the Statement of Administrative Action, H.R. Doc. 103-
316 (``SAA''). See SAA at 870. The Department received no comments on 
the Department's preliminary analysis of this rate for purposes of 
these final results. Therefore, the Department determines that the PRC-
wide rate of 183.80 is still reliable, relevant, and has probative 
value within the meaning of section 776(c) of the Act.

Final Results of Review

    We determine that the following antidumping duty margins exist:

------------------------------------------------------------------------
                      Exporter                         Margin (percent)
------------------------------------------------------------------------
Zhejiang Native Produce and Animal By-Products                    45.54%
 Import & Export Group Corp.........................
Shanghai Eswell Enterprise Co., Ltd.................             38.60 %
Jinfu Trading Co., Ltd..............................              72.02%
Wuhan Bee Healthy Company, Ltd......................             101.51%
PRC-Wide Rate\2\....................................             183.80%
------------------------------------------------------------------------
\2\ Including Sichuan-Dujiangyan Dubao Bee Industrial Co., Ltd.,
  Shanghai Xiuwei International Trading Co., Ltd., Inner Mongolia
  Autonomous Region Native Produce and Animal By-Products Import &
  Export Corp., and Shanghai Shinomiel International Trade Corporation.

    For details on the calculation of the antidumping duty weighted-
average margin for each company, see the respective company's Analysis 
Memorandum for the Final Results of the Second Administrative Review of 
the Antidumping Duty Order on Honey from the People's Republic of 
China, dated June 27, 2005. Public Versions of these memoranda are on 
file in the CRU.

Assessment of Antidumping Duties

    The Department will determine, and CBP shall assess, antidumping 
duties on all appropriate entries. The Department will issue 
appropriate assessment instructions directly to CBP within 15 days of 
publication of the final results of this review. For assessment 
purposes, where possible, we calculated importer-specific assessment 
rates for honey from the PRC on a per-unit basis.\3\ Specifically, we 
divided the total dumping margins (calculated as the difference between 
normal value and export price or constructed export price) for each 
importer by the total quantity of subject merchandise sold to that 
importer during the POR to calculate a per-unit assessment amount. In 
this and future reviews, we will direct CBP to assess importer-specific 
assessment rates based on the resulting per-unit (i.e., per-kilogram) 
rates by the weight in kilograms of each entry of the subject 
merchandise during the POR.
---------------------------------------------------------------------------

    \3\ In our Preliminary Results, for those respondents who 
reported an entered value, we divided the total dumping margins for 
the reviewed sales by the total entered value of those reviewed 
sales for each applicable importer to calculate an ad valorem 
assessment rate.
---------------------------------------------------------------------------

Cash Deposits

    For this and all subsequent review segments, we will establish and 
collect a per-kilogram cash deposit amount which will be equivalent to 
the company-specific dumping margin published in this and all future 
reviews. The following cash-deposit requirements will be effective upon 
publication of these final results for shipments of the subject 
merchandise entered, or withdrawn from warehouse, for consumption on or 
after the publication date of the final results, as provided by section 
751(a)(2)(C) of the Act: (1) for subject merchandise exported by 
Shanghai Eswell, Jinfu, Wuhan Bee, and Zhejiang, we will establish a 
per-kilogram cash deposit rate which will be equivalent to the company-
specific cash deposit established in this review; (2) the cash deposit 
rate for PRC exporters who received a separate rate in a prior segment 
of the proceeding will continue to be the rate assigned in that segment 
of the proceeding (except for Dubao, Inner Mongolia, and Shanghai 
Xiuwei, whose cash-deposit rates have changed in this review to the 
PRC-wide entity rate, as noted below); (3) for all other PRC exporters 
of subject merchandise which have not been found to be entitled to a 
separate rate (including Dubao, Shanghai Xiuwei, Inner Mongolia, and 
Shanghai Shinomiel), the cash-deposit rate will be the PRC-wide rate of 
183.80 percent; (4) for all non-PRC exporters of subject merchandise, 
the cash-deposit rate will be the rate applicable to the PRC supplier 
of that exporter.
    These deposit requirements shall remain in effect until publication 
of the final results of the next administrative review.

Notification to Interested Parties

    This notice also serves as the final reminder to importers of their 
responsibility under 19 CFR 351.402(f) to file a certificate regarding 
the reimbursement of antidumping duties prior to liquidation of the 
relevant entries during this review period. Failure to comply with this 
requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and in the subsequent 
assessment of double antidumping duties.
    This notice also serves as the only reminder to parties subject to 
administrative protective order (``APO'') of their responsibility 
concerning the return/destruction or conversion to judicial protective 
order of proprietary information disclosed under APO in accordance with 
19 CFR 351.305(a)(3). Failure to comply is a violation of the APO.
    This determination is issued and published in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: June 27, 2005.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.

Appendix I

List of Issues

General Issues

Comment 1: Appropriate Surrogate Value for Honey

[[Page 38881]]

Comment 2: Appropriate Surrogate Value for Financial Ratios
Comment 3: Calculation of the MHPC Financial Ratios
Comment 4: Brokerage and Handling Expenses
Comment 5: Recalculation of Constructed Export Price (``CEP'') Profit
Comment 6: Calculation of the Surrogate Wage Rate
Comment 7: Calculation of Assessment and Cash Deposit Rate

Company-Specific Issues

Jinfu-Related Issue:

Comment 8: Classification of Jinfu's U.S. Sales

Shanghai Eswell-Related Issues

Comment 9: Calculation of the Assessment Rates for Shanghai Eswell
Comment 10: Classification of Shanghai Eswell's U.S. Sales

Wuhan Bee-Related Issues

Comment 11: Classification of Wuhan Bee's U.S. Sales
Comment 12: Use of EP sales for Wuhan Bee
Comment 13: Application of Adverse Facts Available to Wuhan Bee
[FR Doc. E5-3547 Filed 7-5-05; 8:45 am]
BILLING CODE 3510-DS-S