Brake Rotors From the People's Republic of China: Preliminary Results and Partial Rescission of the 2004/2005 Administrative Review and Preliminary Notice of Intent To Rescind the 2004/2005 New Shipper Review, 26736-26745 [E6-6988]
Download as PDF
<![CDATA[
26736
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
This notice is to serve as a correction
to the producer and exporter name. The
Department’s findings in the final
determination are correct and remain
unchanged.
This correction is issued and
published in accordance with section
777(i) of the Tariff Act of 1930, as
amended.
Dated: May 2, 2006.
David M. Spooner,
Assistant Secretary for Import
Administration.
[FR Doc. E6–6984 Filed 5–5–06; 8:45 am]
BILLING CODE 3510–DS–S
DEPARTMENT OF COMMERCE
International Trade Administration
[A–570–846]
Brake Rotors From the People’s
Republic of China: Preliminary Results
and Partial Rescission of the 2004/2005
Administrative Review and Preliminary
Notice of Intent To Rescind the 2004/
2005 New Shipper Review
Import Administration,
International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce
(‘‘the Department’’) is currently
conducting the 2004/2005
administrative review and the 2004/
2005 new shipper review of the
antidumping duty order on brake rotors
from the People’s Republic of China
(‘‘PRC’’). We preliminarily determine
that sales have been made below normal
value (‘‘NV’’) with respect to certain
exporters who participated fully and are
entitled to a separate rate in the
administrative review. We also have
preliminarily determined that the single
sale made by the new shipper, Shanxi
Zhongding Auto Parts Co.,
Ltd.(‘‘SZAP’’), was not bona fide. If
these preliminary results are adopted in
our final results of these reviews, we
will instruct U.S. Customs and Border
Protection (‘‘CBP’’) to assess
antidumping duties on entries of subject
merchandise during the period of
review (‘‘POR’’) for which the importer–
specific assessment rates are above de
minimis.
Interested parties are invited to
comment on these preliminary results.
We will issue the final results no later
than 120 days from the date of
publication of this notice.
EFFECTIVE DATE: May 8, 2006.
FOR FURTHER INFORMATION CONTACT: Erin
C. Begnal or Christopher D. Riker, AD/
CVD Operations, Office 9, Import
Administration, International Trade
wwhite on PROD1PC61 with NOTICES
AGENCY:
VerDate Aug<31>2005
16:05 May 05, 2006
Jkt 208001
Administration, U.S. Department of
Commerce, 14th Street and Constitution
Avenue, NW, Washington, DC 20230;
telephone: (202) 482–1442 or (202) 482–
3441, respectively.
SUPPLEMENTARY INFORMATION:
Background
On February 19, 1999, the Department
published in the Federal Register the
antidumping duty order on brake rotors
from the PRC. See Notice of
Antidumping Duty Order: Brake Rotors
from the People’s Republic of China, 62
FR 18740 (April 17, 1997).
On March 23, 2005, SZAP, in
accordance with 19 CFR 351.214(c),
requested a new shipper review of the
antidumping duty order on brake rotors
from the PRC, which has an April
anniversary month. In response to the
Department’s April 14, 2005, request for
information, SZAP provided
supplemental information on April 29,
2005. Furthermore, on April 29, 2005,
SZAP agreed to waive the time limits of
its new shipper review of brake rotors
from the PRC, pursuant to 19 CFR
351.214(j)(3), and agreed to have its
review conducted concurrently with the
2004/2005 administrative review. On
May 27, 2005, the Department initiated
a new shipper review of SZAP covering
the period April 1, 2004, through March
31, 2005. See Brake Rotors From the
People’s Republic of China: Initiation of
New Shipper Antidumping Duty Review,
70 FR 30696 (May 27, 2005).
On April 1, 2005, the Department
published a notice of opportunity to
request an administrative review of the
antidumping duty order on brake rotors
from the PRC. See Antidumping or
Countervailing Duty Order, Finding, or
Suspended Investigation; Opportunity
To Request Administrative Review, 70
FR 16799 (April 1, 2005).
The Department received timely
requests from Laizhou Auto Brake
Equipment Company (‘‘LABEC’’); Yantai
Winhere Auto–Part Manufacturing Co.,
Ltd. (‘‘Winhere’’); Longkou Haimeng
Machinery Co., Ltd. (‘‘Haimeng’’);
Laizhou Hongda Auto Replacement
Parts Co., Ltd. (‘‘Hongda’’); Hongfa
Machinery (Dalian) Co., Ltd. (‘‘Hongfa’’);
Qingdao Meita Automotive Industry
Co., Ltd. (‘‘Meita’’); and Shandong
Huanri Group General Co., Laizhou
Huanri Automobile Parts Co., Ltd., and
Shandong Huanri Group Co., Ltd.
(Collectively, ‘‘Huanri’’), on April 27,
2005, for an administrative review of
this antidumping duty order in
accordance with 19 CFR 351.213. The
Department also received a timely
request for an administrative review of
26 companies (or producer/exporter
PO 00000
Frm 00004
Fmt 4703
Sfmt 4703
combinations),1 from the Coalition for
the Preservation of American Brake
Drum and Rotor Aftermarket
Manufacturers (‘‘petitioners’’), on April
28, 2005.
On May 16, 2005, the Department
received from CBP copies of customs
documents pertaining to the entry of
brake rotors from the PRC exported by
SZAP during the POR. See
Memorandum to the File through John
Conniff, Acting Program Manager, AD/
CVD Operations, Office 9, Import
Administration, from Edward Jacobson,
Analyst, AD/CVD Operations, Office 9,
Import Administration, regarding 13th
Antidumping New Shipper Review of
Brake Rotors from the People’s Republic
of China (July 13, 2005).
On May 23, 2005, the Department
initiated an administrative review of the
antidumping duty order on brake rotors
from the PRC. See Notice of Initiation of
Antidumping and Countervailing Duty
Administrative Reviews and Request for
Revocation in Part, 70 FR 30694 (May
27, 2005) (‘‘Initiation Notice’’). The
review was initiated for 27 individually
named firms, with a POR of April 1,
2004, through March 31, 2005.2
1 The names of these exporters are as follows: (1)
China National Industrial Machinery Import &
Export Corporation (‘‘CNIM’’); (2) Laizhou
Automobile Brake Equipment Factory; (3) Qingdao
Gren Co. (‘‘Gren’’); (4) Winhere; (5) Haimeng; (6)
Zibo Luzhou Automobile Parts Co., Ltd. (‘‘ZLAP’’);
(7) Hongda; (8) Hongfa; (9) Meita; (10) Shandong
Huanri (Group) General Company; (11) Longkou
TLC Machinery Co., Ltd. (‘‘LKTLC’’); (12) Zibo
Golden Harvest Machinery Limited Company
(‘‘ZGOLD’’); (13) Shanxi Fengkun Metallurgical
Limited Company (‘‘Fengkun’’); (14) Xianghe
Xumingyuan Auto Parts Co. (‘‘Xumingyuan’’); (15)
Xiangfen Hengtai Brake System Co., Ltd.
(‘‘Hengtai’’); (16) Laizhou City Luqi Machinery Co.,
Ltd. (‘‘Luqi’’); (17) Qingdao Rotec Auto Parts Co.,
Ltd. (‘‘Rotec’’); (18) Shenyang Yinghao Machinery
Co. (‘‘Yinghao’’); (19) Longkou Jinzheng Maxhinery
(sic) Co. (‘‘Jinzheng’’); (20) Dixion Brake System
(Longkou) Ltd. (‘‘Dixion’’); (21) Laizhou Wally
Automobile Co., Ltd. (‘‘Wally’’); (22) China National
Machinery & Equipment Import & Export
(Xianjiang) Corporation and manufactured by any
company other than Zibo Botai Manufacturing Co.,
Ltd. (‘‘Xianjiang/Other than Zibo’’); (23) National
Automotive Industry Import & Export Corporation
or China National Automotive Industry Import &
Export Corporation, and manufactured by any
company other than Shandong Laizhou Capco
Industry (‘‘CNAIIEC/other than Capco’’); (24)
Shandong Laizhou Capco Industry, and
manufactured by any company other than
Shandong Laizhou Capco Industry (‘‘Capco/other
than Capco’’); (25) Laizhou Luyuan Automobile
Fittings Co., and manufactured by any company
other than Laizhou Luyuan Automobile Fittings
Co., or Shenyang Honbase Machinery Co., Ltd.
(‘‘LLAFC/other than LLAFC or Honbase’’); and (26)
Shenyang Honbase Machinery Co., Ltd., and
manufactured by any company other than Laizhou
Luyuan Automobile Fittings Co., or Shenyang
Honbase Machinery Co., Ltda. (sic) (‘‘Honbase/other
than Honbase or LLAFC’’).
2 Note: the Department inadvertently separately
initiated on Laizhou Huanri Automobile Parts Co.,
Ltd. and Shangdong Huanri Group General Co.
E:\FR\FM\08MYN1.SGM
08MYN1
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
wwhite on PROD1PC61 with NOTICES
Of the 27 named firms for which the
Department initiated an administrative
review, 18 firms indicated they had
shipments of subject merchandise
during the POR that were subject to
review.3 Two firms, Rotec and
Xianjiang/Other than Zibo, did not
respond to the Department’s request for
information relating to whether or not
the firm had shipments subject to the
review. See Memorandum to the File
from Edward Jacobson, Analyst, AD/
CVD Operations, Office 9, Import
Adminisitration, regarding confirmation
of delivery of Department questionnaire
to Qingdao Rotec Auto Parts Co. Ltd.
(June 30, 2005); see also Letter to China
National Industrial Machinery Import &
Export Corporation from Carrie Blozy,
Program Manager, AD/CVD Operations,
Office 9, Import Administration,
regarding Quantity and Value Response
(July 13, 2004). Furthermore, two of the
18 firms, Dixion and Wally, were also
participating in ongoing new shipper
reviews. See Brake Rotors From the
People’s Republic of China: Final
Results of the Twelfth New Shipper
Review, 71 FR 4112 (January 25, 2006).
After consultations, these two
companies agreed to a rescission of their
administrative reviews in accordance
with 19 CFR 351.214(j). See
Memorandum to the File from Carrie
Blozy, Program Manager, AD/CVD
Operations, Office 9, Import
Administration, regarding the 8th
Administrative Review of Brake Rotors
from the People’s Republic of China,
(July 28, 2005). As a result, this
administrative review covers 16
participating firms.
Due to the large number of
participating firms subject to this
administrative review, and the
Department’s experience regarding the
administrative burden to review each
company for which a request was made,
the Department exercised its authority
to limit the number of respondents
selected for individual review by
sampling. On June 7, 2005, the
Department issued letters to all firms
named in the Initiation Notice
requesting information on the quantity
and value of sales of subject
merchandise to the United States (Q&V)
during the POR. See letter to ‘‘All
Interested Parties’’ from James C. Doyle,
Director, AD/CVD Operations, Office 9,
Import Administration (June 7, 2005).
Subsequent letters were sent to potential
3 The firms which indicated they did not have
shipments subject to the review were: Jinzheng
(June 21, 2005), Xumingyuan (June 24, 2005),
CNAIIEC/other than Capco (July 6, 2005), Capco/
other than Capco (July 6, 2005), LLAFC/other than
LLAFC or Honbase (July 6, 2005), and Honbase/
other than Honbase or LLAFC (July 6, 2005).
VerDate Aug<31>2005
16:05 May 05, 2006
Jkt 208001
respondents and the petitioners to
clarify Q&V information covered by this
administrative review on July 7, July 8,
July 11, and September 15, 2005.
On October 14, 2005, the Department
determined that a ‘‘probability–
proportional-to–size’’ sampling
methodology was the most appropriate
approach to limit the selection of
respondents in this review. See Letter to
‘‘All Interested Parties’’ from James C.
Doyle, Director, AD/CVD Operations,
Office 9, Import Administration
(October 14, 2005). Further, the
Department invited comments on the
economic, legal, and administrative
considerations of the proposed sampling
method, pursuant to section 777A(b) of
the Tariff Act of 1930, as amended (‘‘the
Act’’). On October 24, 2005, the
Department received comments on the
proposed sampling methodology from
the petitioners and from LABEC,
Winhere, Haimeng, Hongda, Hongfa,
Meita, Luqi and Huanri.
The Department conducted the
sampling on November 16, 2005. See
Section 777A(c)(2) of the Act; see also
Memorandum to the File through
Christopher Riker, Program Manager,
AD/CVD Operations, Office 9, Import
Administration, from Erin Begnal,
Analyst, AD/CVD Operations, Office 9,
Import Administration, regarding
sampling procedure results in the
Antidumping Duty Administrative
Review: Brake Rotors from the People’s
Republic of China (November 16, 2005)
(‘‘Sampling Procedure Results Memo’’).
The following respondents were
selected for individual review pursuant
to the sampling procedure: Meita,
Winhere, Hengtai, Hongfa, and
Haimeng. See Sampling Procedure
Results Memo; see also Memorandum to
the File through Christopher Riker,
Program Manager, AD/CVD Operations,
Office 9, Import Administration, from
Erin Begnal, Analyst, AD/CVD
Operations, Office 9, Import
Administration, regarding sampling
procedure disclosure for the
Antidumping Duty Administrative
Review: Brake Rotors from the People’s
Republic of China (November 16, 2005);
Memorandum to Stephen J. Claeys,
Deputy Assistant Secretary for Import
Administration, from James C. Doyle,
Director, AD/CVD Operations, Office 9,
Import Administration, regarding
Selection of Respondents for the 2004/
2005 Antidumping Administrative
Review of Brake Rotors from the
People’s Republic of China (December
19, 2005) (where the Department also
addressed certain comments received on
the Department’s sampling
methodology).
PO 00000
Frm 00005
Fmt 4703
Sfmt 4703
26737
On December 20, 2005, the
Department published in the Federal
Register a notice of postponement of the
preliminary results until no later than
May 1, 2006. See Brake Rotors from the
People’s Republic of China: Extension of
Time Limit for Preliminary Results of
Antidumping Duty Administrative
Review and New Shipper Review, 70 FR
75448 (December 20, 2005).
Respondents
On November 23, 2005, we issued
antidumping duty questionnaires to
Haimeng, Hengtai, Hongfa, Meita, and
Winhere. On November 28, 2005, the
Department sent a description of the
products under review to the five
aforementioned companies. See letters
to Haimeng, Hengtai, Hongfa, Meita, and
Winhere from Christopher Riker,
Program Manager, China/NME Group,
Office 9, Import Administration,
regarding Antidumping Duty
Administrative Review: Brake Rotors
from the People’s Republic of China (04/
01/04–03/31/05), (November 28, 2005).
On December 16, 2005, the
Department invited parties to submit
comments on the selection of a
surrogate country and to submit
publicly available information for
purposes of calculating normal value.
See letter to ‘‘All Interested Parties’’
from Christopher D. Riker, Program
Manager, AD/CVD Operations 9, Import
Administration, regarding
Administrative Review and New
Shipper Review of Brake Rotors from the
People’s Republic of China: Office of
Policy list of Economically Comparable
Countries and Schedule for Comments
on Surrogate Country (December 16,
2005).
On December 21, 2005, we received
section A responses from Haimeng,
Hengtai, Hongfa, Meita, and Winhere.
On December 30, 2005, the Department
issued supplemental section A
questionnaires to Haimeng, Hengtai,
Hongfa, Meita, and Winhere. On January
6, 2006, we received sections C and D
responses from Haimeng, Hongfa, Meita,
and Winhere, and on January 10, 2006,
we received the sections C and D
responses from Hengtai. On January 11,
2006, we received comments from
petitioners on the reconciliation
responses submitted by Winhere, Meita
and Haimeng.
On January 17, 2006, Hengtai
submitted its response to the
Department’s supplemental section A
questionnaire. On January 19, 2006, the
Department issued a supplemental
sections C and D questionnaire to
Hongfa, and issued supplemental
sections C and D questionnaires to
Haimeng, Hengtai, Meita, and Winhere
E:\FR\FM\08MYN1.SGM
08MYN1
wwhite on PROD1PC61 with NOTICES
26738
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
the following day (i.e., January 20,
2006). On January 24, 2006, we received
supplemental section A responses from
Haimeng, Hongfa, Meita and Winhere,
and on February 13, 2006, we received
supplemental sections C and D
responses from Haimeng, Hengtai,
Hongfa, Meita and Winhere.
The Department has a rebuttable
presumption that a single dumping
margin is appropriate for all exporters in
an NME country. However, the
Department considers information
submitted in response to Departmental
questionnaires in order to determine
whether or not respondents qualify for
a separate rate. On January 10, 2006, the
Department issued section A
questionnaires to CNIM, LABEC, Gren,
ZLAP, Hongda, Huanri, Longkou TLC,
ZGOLD, Fengkun, Luqi and Yinghao in
order to determine whether or not they
qualify for a separate rate.
On January 30, 2006, we received
section A responses from ZGOLD and
ZLAP. On January 31, 2006, we received
a section A response from Longkou TLC.
On February 3, 2006, we received
section A responses from Hongda,
Huanri, LABEC, and Luqi. On February
8, 2006, we received section A
responses from CNIM, GREN, Fengkun
and Yinghao. On February 10, 2006, the
Department issued a supplemental
section A questionnaire to Huanri. On
February 13, 2006, Hongda provided a
CBP entry summary that was not
included in its February 3, 2006, section
A response. In addition to the
supplemental questionnaire issued to
Huanri, we sent supplemental section A
questionnaires to LABEC, Luqi, ZGOLD
and ZLAP on February 15, 2006;
Longkou TLC and Yinghao on February
22, 2006; CNIM on February 23, 2006;
Fengkun and GREN on March 2, 2006;
and Hongda on March 16, 2006.
On February 22, 2006, we received a
response to our supplemental section A
questionnaire from Huanri. On February
27, 2006, we received responses to our
supplemental section A questionnaires
from LABEC, Luqi, ZGOLD, and ZLAP.
On March 2, 2006, we received a
supplemental section A response from
Longkou TLC. On March 6, 2006, we
received supplemental section A
responses from CNIM and Yinghao. We
also received supplemental section A
responses from GREN and Fengkun on
March 14, 2006 and from Hongda on
March 28, 2006.
On February 14, 2006, the Department
issued verification outlines to Meita,
Winhere and Huanri. The Department
conducted verification of the responses
of Winhere from February 27 through
March 1, 2006 and Meita from March 2
through 4, 2006. Huanri cancelled
VerDate Aug<31>2005
16:05 May 05, 2006
Jkt 208001
verification one day before it was set to
commence. See letter from Huanri
regarding cancellation of verification
(March 8, 2006). On March 3, 2006, the
Department issued a verification outline
to Hongfa; the Department issued a
verification outline to SZAP on March
7, 2006. On March 6, 2006, Meita
submitted minor corrections presented
at verification. The Department
conducted verification of the responses
of Hongfa from March 13 through 15,
2006, and SZAP from March 22 through
24, 2006.
On March 16, 2006, petitioners
submitted publicly available
information for use in the calculation of
normal value in the administrative and
new shipper reviews. Also, on March
16, 2006, Haimeng, Hongfa, Meita,
Winhere, LABEC, Hongda, and Luqi
submitted publicly available
information for use in the calculation of
normal value in the administrative
review. On March 27, 2006, petitioners
submitted rebuttal comments to the
aforementioned respondents’ March 16,
2006, filing. On April 13, 2006,
Haimeng, Hongfa, Meita, Winhere,
LABEC, Hongda, and Luqi submitted
additional publicly available
information for consideration in valuing
brokerage and handling.
On April 20, 2006, the Department
released the verification reports for
Hongfa, Meita and Winhere. See
Verification of the Sales and Factors
Response of Qingdao Meita Automotive
Industry Co., Ltd. in the Antidumping
Administrative Review of Brake Rotors
from the People’s Republic of China
(April 20, 2006) (‘‘Meita Verification
Report’’); Verification of the Sales and
Factors Response of Yantai Winhere
Auto–Part Manufacturing Co., Ltd. in
the Antidumping Administrative Review
of Brake Rotors from the People’s
Republic of China (April 20, 2006)
(‘‘Winhere Verification Report’’);
Verification of the Sales and Factors
Response of Hongfa Machinery (Dalian)
Co., Ltd. in the Antidumping
Administrative Review of Brake Rotors
from the People’s Republic of China
(April 20, 2006) (‘‘Hongfa Verification
Report’’). On April 26, 2006, the
Department released the verification
report for SZAP. See Verification of the
Sales and Factors Response of Shanxi
Zhongding Auto Parts Co., Ltd. in the
New Shipper Review of Brake Rotors
from the People’s Republic of China
(April 26, 2006) (‘‘SZAP Verification
Report’’).
Surrogate Country and Factors
As previously stated, on December 16,
2005, the Department provided parties
an opportunity to submit publicly
PO 00000
Frm 00006
Fmt 4703
Sfmt 4703
available information (‘‘PAI’’) on
surrogate countries and values for
consideration in these preliminary
results. As previously indicated, the
Department received comments on
March 16, 2006, March 27, 2006, and
April 13, 2006.
Scope of the Order
The products covered by this order
are brake rotors made of gray cast iron,
whether finished, semifinished, or
unfinished, ranging in diameter from 8
to 16 inches (20.32 to 40.64 centimeters)
and in weight from 8 to 45 pounds (3.63
to 20.41 kilograms). The size parameters
(weight and dimension) of the brake
rotors limit their use to the following
types of motor vehicles: automobiles,
all–terrain vehicles, vans and
recreational vehicles under ‘‘one ton
and a half,’’ and light trucks designated
as ‘‘one ton and a half.’’
Finished brake rotors are those that
are ready for sale and installation
without any further operations. Semi–
finished rotors are those on which the
surface is not entirely smooth, and have
undergone some drilling. Unfinished
rotors are those which have undergone
some grinding or turning.
These brake rotors are for motor
vehicles, and do not contain in the
casting a logo of an original equipment
manufacturer (‘‘OEM’’) which produces
vehicles sold in the United States. (e.g.,
General Motors, Ford, Chrysler, Honda,
Toyota, Volvo). Brake rotors covered in
this order are not certified by OEM
producers of vehicles sold in the United
States. The scope also includes
composite brake rotors that are made of
gray cast iron, which contain a steel
plate, but otherwise meet the above
criteria. Excluded from the scope of this
order are brake rotors made of gray cast
iron, whether finished, semifinished, or
unfinished, with a diameter less than 8
inches or greater than 16 inches (less
than 20.32 centimeters or greater than
40.64 centimeters) and a weight less
than 8 pounds or greater than 45 pounds
(less than 3.63 kilograms or greater than
20.41 kilograms).
Brake rotors are currently classifiable
under subheading 8708.39.5010 of the
Harmonized Tariff Schedule of the
United States (‘‘HTSUS’’). Although the
HTSUS subheading is provided for
convenience and customs purposes, the
written description of the scope of this
order is dispositive.
Verification
On August 31, 2005, petitioners
requested that the Department conduct
verification of the data submitted by all
of the firms for which the Department
initiated an administrative review, as
E:\FR\FM\08MYN1.SGM
08MYN1
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
wwhite on PROD1PC61 with NOTICES
well as SZAP. However, due to the
Department’s resource constraints in
conducting these reviews, we only
selected Hongfa, Huanri, Meita,
Winhere and SZAP for verification
pursuant to Section 782(i)(2) of the Act
and 19 CFR 351.307. As noted above,
Huanri cancelled its verification a day
prior to its scheduled commencement.
See letter from Huanri regarding
cancellation of verification (March 8,
2006).
For the companies we did verify, we
used standard verification procedures,
including on–site inspection of the
manufacturers’ and exporters’ facilities,
and examination of relevant sales and
financial records. Our verification
results are outlined in the verification
report for each company. For a further
discussion, see the Meita Verification
Report, the Winhere Verification Report,
the Hongfa Verification Report, and the
SZAP Verification Report.
Preliminary Partial Rescission of 2004/
2005 Administrative Review
With respect to Jinzheng,
Xumingyuan, CNAIIEC/other than
Capco, Capco/other than Capco, LLAFC/
other than LLAFC or Honbase, and
Honbase/other than Honbase or LLAFC,
each has informed the Department that
it did not export the subject
merchandise to the United States during
the POR in the combinations referenced
above, where applicable. Specifically,
(1) neither Jinzheng nor Xumingyuan
exported subject merchandise to the
United States during the POR; (2)
CNAIIEC did not export brake rotors to
the United States that were
manufactured by producers other than
Capco; (3) Capco did not export brake
rotors to the United States that were
manufactured by producers other than
Capco; (4) LLAFC did not export brake
rotors to the United States that were
manufactured by producers other than
LLAFC or Honbase; and (5) Honbase did
not export brake rotors to the United
States that were manufactured by
producers other than Honbase or
LLAFC. In order to corroborate these
submissions, we reviewed PRC brake
rotor shipment data maintained by CBP,
and noted no discrepancies with the
statements made by these firms.
Furthermore, on July 28, 2005, Dixion
and Wally noted, in accordance with
section 351.214(j) of the Department’s
regulations, that their ongoing new
shipper reviews covered all of their
subject merchandise exports which
would be subject to this administrative
review. After consulting with both,
Wally and Dixon agreed to a rescission
of their administrative reviews. See
Memorandum to the File from Carrie
VerDate Aug<31>2005
16:05 May 05, 2006
Jkt 208001
Blozy, Program Manager, AD/CVD
Operations, Office 9, Import
Administration, regarding the 8th
Administrative Review of Brake Rotors
from the People’s Republic of China,
(July 28, 2005).
Therefore, for the reasons mentioned
above, we are preliminarily rescinding
the administrative review with respect
to Jinzheng, Xumingyuan, CNAIIEC/
other than Capco, Capco/other than
Capco, LLAFC/other than LLAFC or
Honbase, Honbase/other than Honbase
or LLAFC, and Dixion and Wally
because we either found no evidence
that any of these companies made
shipments of the subject merchandise
during the POR, in accordance with 19
CFR 351.213(d)(3), or these companies
consented to a rescission of the
administrative review pursuant to 19
CFR 351.214(j).
Bona Fide Sale Analysis—SZAP
For the reasons stated below, we
preliminarily find that SZAP’s reported
U.S. sale during the POR does not
appear to be a bona fide sale, based on
the totality of the facts on the record.
See Glycine From The People’s Republic
of China: Rescission of Antidumping
Duty New Shipper Review of Hebei New
Donghua Amino Acid Co., Ltd., 69 FR
47405, 47406 (August 5, 2004).
Specifically, we find that: 1) the
difference in the sales price of SZAP’s
single POR sale as compared to the
prices of its subsequent sales, 2) the
quantity of its single POR sale as
compared to its subsequent sales, 3)
questionable sales documentation
pertaining to SZAP’s U.S. sale; and
finally, 4) other indicia of a non–bona
fide transaction, all demonstrate that the
single sale under review was not bona
fide. Therefore, this sale does not
provide a reasonable or reliable basis for
calculating a dumping margin.
For the reasons mentioned above, the
Department preliminarily finds that
SZAP’s sole U.S. sale during the POR
was not a bona fide commercial
transaction and is preliminarily
rescinding the new shipper review of
SZAP. For a more detailed analysis, see
Memorandum to James C. Doyle,
Director, AD/CVD Operations, Office 9,
Import Administration, through
Christopher D. Riker, Program Manager,
AD/CVD Operations, Office 9, from Erin
C. Begnal, Analyst, AD/CVD Operations,
Office 9, regarding Bona Fides Analysis
and Intent to Rescind New Shipper
Review of Brake Rotors from the
People’s Republic of China for Shanxi
Zhongding Auto Parts Co., Ltd. (May 1,
2006).
PO 00000
Frm 00007
Fmt 4703
Sfmt 4703
26739
Non–Market Economy Country
In every case conducted by the
Department involving the PRC, the PRC
has been treated as a non–market
economy (‘‘NME’’) country. Pursuant to
section 771(18)(C)(i) of the Act, any
determination that a foreign country is
a NME country shall remain in effect
until revoked by the administering
authority. See, e.g., Freshwater Crawfish
Tail Meat from the People’s Republic of
China: Notice of Final Results of
Antidumping Duty Administrative
Review, 71 FR 7013 (February 10, 2006).
None of the parties to this proceeding
has contested such treatment.
Accordingly, we calculated NV in
accordance with section 773(c) of the
Act, which applies to NME countries.
Surrogate Country
Section 773(c)(4) of the Act requires
the Department to value an NME
producer’s factors of production, to the
extent possible, in one or more market–
economy countries that (1) are at a level
of economic development comparable to
that of the NME country, and (2) are
significant producers of comparable
merchandise. India is among the
countries comparable to the PRC in
terms of overall economic development.
See Letter to ‘‘All Interested Parties’’
from Christopher D. Riker, Program
Manager, AD/CVD Operations 9,
regarding Administrative Review and
New Shipper Review of Brake Rotors
from the People’s Republic of China:
Office of Policy list of Economically
Comparable Countries and Schedule for
Comments on Surrogate Country at
Attachment I (December 16, 2005). In
addition, based on publicly available
information placed on the record (e.g.,
export data), India is a significant
producer of the subject merchandise.
See Memorandum to James C. Doyle,
Director, AD/CVD Operations, Office 9,
Import Administration, through
Christopher D. Riker, Program Manager,
AD/CVD Operations, Office 9, from
Michael Quigley, Analyst, AD/CVD
Operations, Office 9, regarding 2004–
2005 Antidumping Duty Administrative
Review and New Shipper Review of
Brake Rotors from the People’s Republic
of China: Selection of a Surrogate
Country (May 1, 2006). Accordingly, we
have selected India as the primary
surrogate country for purposes of
valuing the factors of production
because it meets the Department’s
criteria for surrogate–country selection.
See Id.
E:\FR\FM\08MYN1.SGM
08MYN1
26740
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
wwhite on PROD1PC61 with NOTICES
Facts Available—Hengtai, Rotec and
Xianjiang/Other than Zibo
For the reasons outlined below, we
have applied total adverse facts
available to Hengtai, Rotec and
Xianjiang/Other than Zibo.
At the verification of SZAP, we found
email correspondence between SZAP
and Hengtai from the POR which
indicated that SZAP produced brake
rotors that were sold by Hengtai, and
that Hengtai also purchased brake rotors
from SZAP. Hengtai did not report that
SZAP was a supplier during the POR
and therefore there is no indication that
Hengtai accurately reported its factors of
production including SZAP’s factors of
production, as required. In addition,
there is no indication that Hengtai
included sales of subject merchandise
manufactured by SZAP in its U.S. sales
database, thereby understating its total
U.S. sales.
Because these findings directly
contradict statements made on the
record by Hengtai that Hengtai
produced all of the subject merchandise
that it sold during the POR, we find that
Hengtai did not provide the Department
with accurate or complete data pursuant
to section 776(a)(2) of the Act.
Specifically, section 776(a)(2) of the Act
provides that, if an interested party: (A)
withholds information that has been
requested by the Department, (B) fails to
provide such information in a timely
manner or in the form or manner
requested subject to sections 782(c)(1)
and (e) of the Act, (C) significantly
impedes a proceeding under the
antidumping statute, or (D) provides
such information but the information
cannot be verified, the Department
shall, subject to section 782(d) of the
Act, use facts otherwise available in
reaching the applicable determination.
The evidence discovered at SZAP’s
verification suggests Hengtai likely sold
subject merchandise produced by SZAP
to the United States. If so, Hengtai
should have reported U.S. sales of
merchandise produced by SZAP as well
as SZAP’s factors of production in
conjunction with its own. Because
evidence obtained by the Department
indicates that Hengtai’s reported factors
of production data certainly, and U.S.
sales data likely, is incomplete, we have
no choice but to apply facts available to
Hengtai.
Furthermore, section 776(b) of the Act
states that if the Department ‘‘finds that
an interested party has failed to
cooperate by not acting to the best of its
ability to comply with a request for
information from the administering
authority or the Commission, the
administering authority or the
VerDate Aug<31>2005
16:05 May 05, 2006
Jkt 208001
Commission . . ., in reaching the
applicable determination under this
title, may use an inference that is
adverse to the interests of that party in
selecting from among the facts
otherwise available.’’ See also Statement
of Administrative Action accompanying
the URAA, H.R. Rep. No. 103–316 at
870 (1994) (‘‘SAA’’). Because Hengtai
withheld information in its possession
and failed to do its utmost in response
to the Department’s questions, the
Department is applying total adverse
facts available to Hengtai. See
Memorandum to James C. Doyle,
Director, AD/CVD Operations, Office 9,
Import Administration , through
Christopher D. Riker, Program Manager,
AD/CVD Operations, Office 9, Import
Administration, from Erin C. Begnal,
Case Analyst, AD/CVD Operations,
Office 9, Import Administration,
regarding 2004/2005 Antidumping
Administrative Review of Brake Rotors
from the People’s Republic of China:
Preliminary Application of Adverse
Facts Available to Xiangfen Hengtai
Brake System Co., Ltd., (May 1, 2006)
for further discussion on the application
of adverse facts available to Hengtai.
The Department mailed Q&V
questionnaires to Rotec and Xianjiang/
Other than Zibo on June 7, 2005.
However, both Rotec and Xianjiang/
Other than Zibo failed to respond to the
Department’s Q&V questionnaire. By not
responding to the Department’s Q&V
questionnaire, Rotec and Xianjiang/
Other than Zibo failed to provide
critical information to be used for the
Department’s respondent selection
process. Pursuant to sections 776(a) and
(b) of the Act, the Department may
apply adverse facts available if it finds
a respondent has failed to cooperate by
not acting to the best of its ability to
comply with a request for information
from the Department. By failing to
respond to the Department’s Q&V
questionnaire, Rotec and Xianjiang/
Other than Zibo have failed to act to the
best of their ability in this segment of
the proceeding.
In addition, because Rotec and
Xianjiang/Other than Zibo did not
participate in the respondent selection
exercise, the Department did not send
them a questionnaire and was unable to
determine whether or not they qualified
for a separate rate. Therefore, Rotec and
Xianjiang/Other than Zibo are not
eligible to receive a separate rate and
will be part of the PRC–wide entity,
subject to the PRC–wide rate. Pursuant
to section 776(b) of the Act, we have
applied total adverse facts available
with respect to the PRC–wide entity,
including, among others, Rotec and
Xianjiang/Other than Zibo.
PO 00000
Frm 00008
Fmt 4703
Sfmt 4703
In this segment of the proceeding, in
accordance with Department practice
(see, e.g., Brake Rotors from the People’s
Republic of China: Rescission of Second
New Shipper Review and Final Results
and Partial Rescission of First
Antidumping Duty Administrative
Review, 64 FR 61581, 61584 (November
12, 1999), as adverse facts available, we
have assigned to exports of the subject
merchandise by Rotec and Xianjiang/
Other than Zibo a rate of 43.32 percent,
which is the PRC–wide rate.
Corroboration of Facts Available
Section 776(c) of the Act requires that
the Department corroborate, to the
extent practicable, a figure which it
applies as facts available. To be
considered corroborated, information
must be found to be both reliable and
relevant. We are applying as adverse
facts available (‘‘AFA’’) the highest rate
from any segment of this administrative
proceeding, which is the rate currently
applicable to all exporters subject to the
PRC–wide rate. The information upon
which the AFA rate is based in the
current review (i.e., the PRC–wide rate
of 43.32 percent) was the highest rate
from the petition in the LTFV
investigation. See Notice of
Antidumping Duty Order: Brake Rotors
from the People’s Republic of China, 62
FR 18740 (April 17, 1997). This AFA
rate is the same rate which the
Department assigned to brake rotor
companies in prior reviews and the rate
itself has not changed since the original
LTFV determination. See, e.g., Brake
Rotors From the People’s Republic of
China: Final Results and Partial
Rescission of the Seventh
Administrative Review: Final Results of
the Eleventh New Shipper Review, 70
FR at 69937 (November 18, 2005) (Brake
Rotors 7th Review Final Results). For
purposes of corroboration, the
Department will consider whether that
margin is both reliable and relevant. The
AFA rate we are applying for the current
review was corroborated in reviews
subsequent to the LTFV investigation to
the extent that the Department referred
to the history of corroboration.
Furthermore, no information has been
presented in the current review that
calls into question the reliability of this
information.
With respect to the relevance aspect
of corroboration, the Department will
consider information reasonably at its
disposal to determine whether a margin
continues to have relevance. Where
circumstances indicate that the selected
margin is not appropriate as AFA, the
Department will disregard the margin
and determine an appropriate margin.
For example, in Fresh Cut Flowers from
E:\FR\FM\08MYN1.SGM
08MYN1
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
wwhite on PROD1PC61 with NOTICES
Mexico; Final Results of Antidumping
Administrative Review, 61 FR 6812
(February 22, 1996), the Department
disregarded the highest margin in that
case as adverse best information
available (the predecessor to facts
available) because the margin was based
on another company’s uncharacteristic
business expense resulting in an
unusually high margin. The information
used in calculating this margin was
based on sales and production data
submitted by the petitioner in the LTFV
investigation, together with the most
appropriate surrogate value information
available to the Department chosen from
submissions by the parties in the LTFV
investigation, as well as information
gathered by the Department itself.
Furthermore, the calculation of this
margin was subject to comment from
interested parties in the proceeding.
Moreover, as there is no information on
the record of this review that
demonstrates that this rate is not
appropriately used as AFA, we
determine that this rate has relevance.
As the 43.32 percent rate is both
reliable and relevant, we determine that
it has probative value. Accordingly, we
determine that the calculated rate of
43.32 percent, which is the current
PRC–wide rate, is in accord with the
requirement of section 776(c) that
secondary information be corroborated
to the extent practicable (i.e., that it
have probative value). We have assigned
this AFA rate to exports of the subject
merchandise by the PRC–wide entity,
including Rotec and Xianjiang/Other
than Zibo.
Republic of China, 64 FR 71104
(December 20, 1999).
The remaining 12 respondents (i.e.,
Haimeng, Hengtai, CNIM, LABEC, Gren,
ZLAP, Hongda, Huanri, Longkou TLC,
ZGOLD, Fengkun, and Luqi) are either
joint ventures between PRC and foreign
companies, collectively–owned
enterprises and/or limited liability
companies in the PRC. Thus, for these
12 respondents, a separate rates analysis
is necessary to determine whether the
export activities of each above–
mentioned respondent is independent
from government control. See Notice of
Final Determination of Sales at Less
Than Fair Value: Bicycles From the
People’s Republic of China, 61 FR 19026
(April 30, 1996) (‘‘Bicycles’’). To
establish whether a firm is sufficiently
independent in its export activities from
government control to be entitled to a
separate rate, the Department utilizes a
test arising from the Final
Determination of Sales at Less Than
Fair Value: Sparklers from the People’s
Republic of China, 56 FR 20588 (May 6,
1991) (‘‘Sparklers’’); See also Final
Determination of Sales at Less Than
Fair Value: Silicon Carbide from the
People’s Republic of China, 59 FR 22585
(May 2, 1994) (‘‘Silicon Carbide’’),
where the Department adapted and
amplified the separate rates test set out
in Sparklers. Under the separate–rates
criteria, the Department assigns separate
rates in NME cases only if the
respondent can demonstrate the absence
of both de jure and de facto
governmental control over its export
activities.
Separate Rates
In proceedings involving NME
countries, the Department begins with a
rebuttable presumption that all
companies within the country are
subject to government control and thus
should be assessed a single antidumping
duty deposit rate (i.e., a PRC–wide rate).
Of the 16 respondents participating in
these reviews, four of the PRC
companies (i.e., Hongfa, Meita, Winhere
and Yinghao) are owned wholly by
entities located in market–economy
countries. Thus, for these four
companies, because we have no
evidence indicating that they are under
the control of the PRC government, a
separate rates analysis is not necessary
to determine whether they are
independent from government control.
See, e.g., Brake Rotors from the People’s
Republic of China: Final Results and
Partial Rescission of Fifth New Shipper
Review, 66 FR 44331 (August 23, 2001);
see also Notice of Final Determination
of Sales at Less Than Fair Value:
Creatine Monohydrate from the People’s
1. De Jure Control
Evidence supporting, though not
requiring, a finding of de jure absence
of government control over export
activities includes: (1) an absence of
restrictive stipulations associated with
the individual exporter’s business and
export licenses; (2) any legislative
enactments decentralizing control of
companies; and (3) any other formal
measures by the government
decentralizing control of companies.
Haimeng, Hengtai, CNIM, LABEC,
Gren, ZLAP, Hongda, Huanri, Longkou
TLC, ZGOLD, Fengkun, and Luqi have
each placed on the administrative
record documents to demonstrate an
absence of de jure control (e.g., the 1994
‘‘Foreign Trade Law of the People’s
Republic of China,’’ and the 1999
‘‘Company Law of the People’s Republic
of China’’).
As in prior cases, we have analyzed
the laws presented to us and have found
them to establish sufficiently an absence
of de jure control over joint ventures
between the PRC and foreign
VerDate Aug<31>2005
16:05 May 05, 2006
Jkt 208001
PO 00000
Frm 00009
Fmt 4703
Sfmt 4703
26741
companies, and limited liability
companies in the PRC. See, e.g., Final
Determination of Sales at Less than Fair
Value: Furfuryl Alcohol from the
People’s Republic of China, 60 FR 22544
(May 8, 1995) (‘‘Furfuryl Alcohol’’);
Preliminary Determination of Sales at
Less Than Fair Value: Certain Partial–
Extension Steel Drawer Slides with
Rollers from the People’s Republic of
China, 60 FR 29571 (June 5, 1995). We
have no new information in this
proceeding which would cause us to
reconsider this determination with
regard to Haimeng, Hengtai, CNIM,
LABEC, Gren, ZLAP, Hongda, Huanri,
Longkou TLC, ZGOLD, Fengkun, and
Luqi.
2. De Facto Control
As stated in previous cases, there is
evidence that certain enactments of the
PRC central government have not been
implemented uniformly among different
sectors and/or jurisdictions in the PRC.
See Silicon Carbide; see also Furfuryl
Alcohol. Therefore, the Department has
determined that an analysis of de facto
control is critical in determining
whether the respondents are, in fact,
subject to a degree of governmental
control which would preclude the
Department from assigning separate
rates.
The Department typically considers
four factors in evaluating whether each
respondent is subject to de facto
governmental control of its export
functions: (1) whether the export prices
are set by, or subject to the approval of,
a governmental authority; (2) whether
the respondent has authority to
negotiate and sign contracts and other
agreements; (3) whether the respondent
has autonomy from the government in
making decisions regarding the
selection of management; and (4)
whether the respondent retains the
proceeds of its export sales and makes
independent decisions regarding the
disposition of profits or financing of
losses. See Silicon Carbide; see also
Furfuryl Alcohol.
Haimeng, Hengtai, CNIM, LABEC,
Gren, ZLAP, Hongda, Huanri, Longkou
TLC, ZGOLD, Fengkun, and Luqi have
each asserted the following: (1) it
establishes its own export prices; (2) it
negotiates contracts without guidance
from any governmental entities or
organizations; (3) it makes its own
personnel decisions; and (4) it retains
the proceeds of its export sales, uses
profits according to its business needs,
and has the authority to sell its assets
and to obtain loans. Additionally, each
of these companies’ questionnaire
responses indicates that its pricing
E:\FR\FM\08MYN1.SGM
08MYN1
wwhite on PROD1PC61 with NOTICES
26742
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
during the POR does not suggest
coordination among exporters.
Consequently, with the exception of
Huanri (as discussed below), we have
preliminarily determined that Haimeng,
Hengtai, CNIM, LABEC, Gren, ZLAP,
Hongda, Huanri, Longkou TLC, ZGOLD,
Fengkun, and Luqi have each met the
criteria for the application of separate
rates based on the documentation each
of these respondents has submitted on
the record of these reviews. See
Memorandum to James C. Doyle,
Director, AD/CVD Enforcement, Office
9, from Christopher D. Riker, Program
Manager, AD/CVD Enforcement, Office
9, Import Administration, regarding
2004/2005 Administrative Review of
Brake Rotors from the People’s Republic
of China: Separate Rates Analysis for
Respondents (Including Exporters Not
Being Individually Reviewed) (May 1,
2006).
With respect to Huanri, the
Department preliminarily finds that it
has not demonstrated a de facto absence
of government control with respect to
making its own decisions in key
personnel selections, the use of its
profits from the proceeds of export
sales, and the authority to negotiate and
sign contracts and other agreements. See
Silicon Carbide. Huanri is therefore not
entitled to a separate rate.
As noted above, on March 8, 2006,
Huanri filed a letter with the
Department indicating that it wished to
cancel the scheduled verification before
it began. Huanri acknowledged in this
letter that it understood, because of the
verification cancellation, that the
Department may find the company has
not cooperated to the best of its ability
pursuant to section 776(b) of the Act.
Section 776(a)(2)(C) of the Tariff Act
of 1930, as amended (the ‘‘Act’’),
provides that, if an interested party
‘‘provides such information but the
information cannot be verified, the
Department shall, subject to section
782(d) of the Act, use facts otherwise
available in reaching the applicable
determination.’’ Because the
Department could not verify the
information submitted by Huanri
regarding its formation and ownership,
that information cannot serve as the
basis for the Department’s
determination regarding Huanri’s
eligibility for a separate rate. Moreover,
because information concerning
Huanri’s submissions were unverifiable,
Huanri has failed to demonstrate that it:
(1) sets its own export prices
independent of the government and
without the approval of a government
authority; (2) has authority to negotiate
and sign contracts, and other
agreements; (3) has autonomy from the
VerDate Aug<31>2005
16:05 May 05, 2006
Jkt 208001
government in making decisions
regarding the selection of its
management; and (4) retains the
proceeds of its export sales and makes
independent decisions regarding
disposition of profits or financing of
losses. See Sparklers. Therefore, as facts
available, and because Huanri failed to
satisfy its administrative burden, we
preliminarily find that Huanri should
properly be considered part of the PRC–
wide entity and be subject to the PRC–
wide rate.
Fair Value Comparisons
To determine whether sales of the
subject merchandise by Haimeng,
Hongfa, Meita, and Winhere to the
United States were made at prices below
normal value (‘‘NV’’), we compared
each company’s export prices (‘‘EPs’’) or
constructed export prices (‘‘CEPs’’) to
NV, as described in the ‘‘Export Price,’’
‘‘Constructed Export Price,’’ and
‘‘Normal Value’’ sections of this notice,
below.
Export Price
For each respondent, we used EP
methodology in accordance with section
772(a) of the Act for sales in which the
subject merchandise was first sold prior
to importation by the exporter outside
the United States directly to an
unaffiliated purchaser in the United
States and for sales in which CEP was
not otherwise indicated. We made the
following company–specific
adjustments:
A. Haimeng, Hongfa, Meita, and
Winhere
We calculated EP based on packed,
FOB or CIF foreign port prices to the
first unaffiliated purchaser in the United
States. Where appropriate, we made
deductions from the starting price (gross
unit price) for foreign inland freight and
foreign brokerage and handling charges
in the PRC, and international freight, in
accordance with section 772(c) of the
Act. Because foreign inland freight and
foreign brokerage and handling fees
were provided by PRC service providers
or paid for in renminbi, we based those
charges on surrogate rates from India.
See ‘‘Surrogate Country’’ section below
for further discussion of our surrogate–
country selection.
To value foreign brokerage and
handling expenses, we used publicly
summarized or ‘‘ranged’’ expense data
submitted during the past year by
Indian companies in connection with
other antidumping duty administrative
reviews conducted by the Department.4
4 We used data from the public version of the
February 28, 2005, Section C response of Essar Steel
PO 00000
Frm 00010
Fmt 4703
Sfmt 4703
In determining the most appropriate
surrogate values to use in a given case,
the Department’s stated practice is to
use investigation or review period–wide
price averages, prices specific to the
input in question, prices that are net of
taxes and import duties, prices that are
contemporaneous with the period of
investigation or review, and publicly
available data. The data we used for
brokerage and handling expenses fulfill
all of the foregoing criteria except that
they are not specific to the subject
merchandise: there is no information of
that type on the record of this review.
The information we used corresponds
in part to what the petitioners placed on
the record for this expense category.
However, we did not use part of the
petitioners’ information (i.e.,
information from Pidilite Industries
Ltd.) which stemmed from an earlier
case because it is not contemporaneous
with the POR in the instant case. We
also did not use some of the information
submitted by respondents Haimeng,
Hongfa, Meita, Winhere, LABEC,
Hongda, and Luqi because it is not clear
what the information represents, e.g.,
what time period it was taken from,
whereas, as noted by petitioners, the
Indian data we are using are per
kilogram values paid by market
economy companies and are
representative of these Indian
companies’ actual practices during the
POR.
We used a simple average of two
companies’ brokerage expense data in
order to achieve a more representative
value than a single source would
provide. Both sources are of equal
quality and are contemporaneous with
the POR. See Bicycles (on using a
simple, as opposed to a weighted,
average in the calculation of financial
ratios).
Two respondents (i.e., Haimeng and
Winhere) reported that they did not
incur costs for the ball bearing cups and
lug bolts they incorporated into certain
brake rotor models which they exported
to the United States, because their U.S.
customers provided these items free–ofcharge. Both companies supported their
claims that their U.S. customers
Limited in the antidumping duty administrative
review of certain hot-rolled carbon steel flat
products from India, which covers the period
December 1, 2003, through November 30, 2004. We
also used information from Agro Dutch Industries
Ltd., taken from the administrative review of
preserved mushrooms from India, for which the
POR was February 1, 2004 through January 31,
2005. See Certain Hot-Rolled Carbon Steel Flat
Products From India: Preliminary Results of
Antidumping Duty Administrative Review, 71 FR
2018 (January 12, 2006); see also Certain Preserved
Mushrooms From India: Final Results of
Antidumping Duty Administrative Review, 71 FR
10646 (March 2, 2006).
E:\FR\FM\08MYN1.SGM
08MYN1
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
wwhite on PROD1PC61 with NOTICES
contracted with PRC ball bearing cup
and lug bolts producers to deliver these
components to the respondents in
specific quantities free–of-charge, and
that the components were then
incorporated, in corresponding
quantities, in the integral models
shipped to U.S. customers during the
POR.
To reflect the U.S. customers’
expenditures for these items, we
adjusted the U.S. price of the
transactions in question by assigning
Indian surrogate values to the ball
bearing cups and lug bolts used in those
integral brake rotor transactions and
added these amounts to U.S. price. See
Brake Rotors 7th Review Final Results
and the accompanying Issues and
Decisions Memorandum at Comment 5.
See also Certain Preserved Mushrooms
From the People’s Republic of China:
Final Results and Final Rescission, in
Part, of Antidumping Duty
Administrative Review 70 FR 54361
(September 14, 2005), and the
accompanying Issues and Decisions
Memorandum at Comment 13.
Normal Value
Section 773(c)(1) of the Act provides
that the Department shall determine NV
using a factors–of-production
methodology if the merchandise is
exported from an NME country and the
information does not permit the
calculation of NV using home–market
prices, third–country prices, or
constructed value under section 773(a)
of the Act. The Department will base NV
on the factors of production because the
presence of government controls on
various aspects of these economies
renders price comparisons and the
calculation of production costs invalid
under its normal methodologies.
For purposes of calculating NV, we
valued the PRC factors of production in
accordance with section 773(c)(1) of the
Act. Factors of production include, but
are not limited to, hours of labor
required, quantities of raw materials
employed, amounts of energy and other
utilities consumed, and representative
capital costs, including depreciation.
See section 773(c)(3) of the Act. In
examining surrogate values, we
selected, where possible, the publicly
available value which was an average
non–export value, representative of a
range of prices within the POR or most
contemporaneous with the POR,
product–specific, and tax–exclusive.
See, e.g., Notice of Preliminary
Determination of Sales at Less Than
Fair Value and Postponement of Final
Determination: Chlorinated
Isocyanurates from the People’s
Republic of China, 69 FR 75294, 75300
VerDate Aug<31>2005
16:05 May 05, 2006
Jkt 208001
(December 16, 2004) (‘‘Chlorinated
Isocyanurates’’). We used the usage
rates reported by the respondents for
materials, energy, labor, by–products,
and packing. For a detailed explanation
of the methodology used to calculate
surrogate values, see Preliminary
Results Valuation Memorandum, dated
May 1, 2005 (‘‘Factor Valuation
Memo’’).
Regarding the components supplied
free–of charge to two respondents,
section 773(c)(3) of the Act states that
‘‘the factors of production utilized in
producing merchandise include, but are
not limited to the quantities of raw
materials employed.’’ Therefore,
consistent with the corresponding
adjustment to U.S. price discussed
above, we valued the ball bearing cups
and lug bolts usage amounts reported by
these respondents for specific integral
brake rotor models by using an Indian
surrogate value for each input. See
Factor Valuation Memo.
Factor Valuations
In accordance with section 773(c) of
the Act, we calculated NV based on the
factors of production reported by the
respondents for the POR. We relied on
the factor specification data submitted
by the respondents for the above–
mentioned inputs in their questionnaire
and supplemental questionnaire
responses, where applicable, for
purposes of selecting surrogate values.
To calculate NV, we multiplied the
reported per–unit factor quantities by
publicly available Indian surrogate
values (except where noted below). In
selecting the surrogate values, we
considered the quality, specificity, and
contemporaneity of the data. As
appropriate, we adjusted input prices by
including freight costs to make them
delivered prices. Specifically, we added
to Indian import surrogate values a
surrogate freight cost using the shorter
of the reported distance from the
domestic supplier to the factory or the
distance from the nearest seaport to the
factory, where appropriate. This
adjustment is in accordance with the
Court of Appeals for the Federal
Circuit’s decision in Sigma Corp. v.
United States, 117 F. 3d 1401 (Fed. Cir.
1997). Due to the extensive number of
surrogate values in this administrative
review, we present a discussion of the
main factors. For a detailed description
of all surrogate values used for
respondents, see Factor Valuation
Memo.
Except where discussed below, we
valued raw material inputs using April
2004–March 2005 weighted–average
Indian import values derived from the
World Trade Atlas online (‘‘WTA’’) (see
PO 00000
Frm 00011
Fmt 4703
Sfmt 4703
26743
also Factor Valuation Memo). The
Indian import statistics we obtained
from the WTA were published by the
DGCI&S, Ministry of Commerce of India,
which were reported in rupees. Indian
surrogate values denominated in foreign
currencies were converted to U.S.
dollars using the applicable average
exchange rate for India for the POR. The
average exchange rate was based on
exchange rate data from the
Department’s Web site. See https://
ia.ita.doc.gov/exchange/.
Where we could not obtain PAI
contemporaneous with the POR with
which to value factors, we adjusted the
surrogate values for inflation using
Indian wholesale price indices (‘‘WPIs’’)
as published in the International
Monetary Fund’s International
Financial Statistics. See Factor
Valuation Memo.
Furthermore, with regard to the
Indian import–based surrogate values,
we have disregarded prices from NME
countries and those that we have reason
to believe or suspect may be subsidized
(i.e., Indonesia, South Korea, and
Thailand). We have found in other
proceedings that these countries
maintain broadly available, non–
industry-specific export subsidies.
Therefore, it is reasonable to believe or
suspect all exports to all markets from
these countries are subsidized. See, e.g.,
Final Determination of Sales at Less
Than Fair Value: Certain Helical Spring
Lock Washers From The People’s
Republic, 58 FR 48833 (September 20,
1993), and accompanying Issues and
Decision Memorandum at Comment 1.
Finally, we excluded imports that
were labeled as originating from an
‘‘unspecified’’ country from the average
value, because the Department could
not be certain that they were not from
either an NME or a country with general
export subsidies.
To value lubrication oil, we used
January 2004–December 2004 WTA
average import values from the
Philippines, because the post–March
2000 Indian import values from WTA
for this input were unavailable or were
labeled as originating from an
‘‘unspecified’’ country. Moreover, the
import values from WTA for the other
recommended surrogate countries either
did not provide data on a country–oforigin–specific basis or were
unavailable.
We valued electricity using the 2000
total average price per kilowatt hour for
‘‘Electricity for Industry’’ as reported in
the International Energy Agency’s
publication, Energy Prices and Taxes,
Second Quarter, 2003. We adjusted this
rate for inflation.
E:\FR\FM\08MYN1.SGM
08MYN1
wwhite on PROD1PC61 with NOTICES
26744
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
The Department revised its
calculation of expected wages of
selected NME countries. See https://
ia.ita.doc.gov/wages/. The
Department’s revised calculation of
expected NME wages, consistent with
its normal methodology and with
Section 351.408(c)(3) of the
Department’s regulations, is based on
the most current data available as of
November 2005. The Department’s
expected NME wage rate for the PRC is
USD $0.97 per hour. We used this wage
rate in valuing labor.
To value corrugated paper cartons,
nails, plastic bags, plastic sheets/covers,
paper sheet, steel strip, particle board,
plywood and straps/buckles, tape and
pallet wood, we used April 2004–March
2005 average import values from WTA.
All respondents (with the exception of
Hengtai) included the weight of the
clamps/buckles in their reported steel
strip weights since the material of both
inputs was the same. Therefore, we
valued these factors using the combined
weight reported by the respondents.
To value PRC inland freight for inputs
shipped by truck, we used Indian freight
rates from the following Web site:
https://www.infreight.com. To value PRC
inland freight by barge we used an
Indian domestic shipping rate from the
2000–2001 antidumping duty
administrative review of helical spring
lock washers from the PRC. See Certain
Helical Spring Lock Washers From the
People’s Republic of China; Final
Results of Antidumping Duty
Administrative Review, 67 FR 8520
(Feb. 25, 2002), and accompanying
decision memorandum at comment 5;
Preliminary Determination of Sales at
Less Than Fair Value and Postponement
of Final Determination: Polyvinyl
Alcohol from the People’s Republic of
China, 68 FR 13674 (March 20, 2003).
We adjusted this rate for inflation.
To value factory overhead and selling,
general and administrative (‘‘SG&A’’)
expenses, and profit, we used data from
the 2004–2005 financial reports of
Kalyani Brakes Limited and Rico Auto
Industries Limited. These Indian
companies are producers of the subject
merchandise based on data contained in
each Indian company’s financial
reports.
Where appropriate, the excise duty
amounts listed in the financial reports
were removed from the surrogate
overhead and SG&A calculations.
Moreover, petitioners made certain
adjustments to the calculated ratios as a
result of reclassifying certain expenses
contained in the financial reports
consistent with the Department’s
normal practice. See, e.g., Brake Rotors
7th Review Final Results. For a further
VerDate Aug<31>2005
16:05 May 05, 2006
Jkt 208001
discussion of the adjustments made, see
Factor Valuation Memo.
Two respondents (i.e., Winhere and
Meita) neglected to report transportation
distances from their casting facilities to
their finishing workshops. See Winhere
Verification Report; see also Meita
Verification Report. Therefore, for
purposes of these preliminary results,
we are using the surrogate value for
truck freight to value this foreign inland
transportation expense for these two
companies using distances information
obtained at verification. See
Memorandum to the File, through
Christopher D. Riker, Program Manager,
Ad/CVD Operations, Office 9, Import
Administration, from Thomas Killiam,
Analyst, AD/CVD Operations, Office 9,
Import Administration, regarding 2004/
2005 Antidumping Duty Administrative
Review of the Antidumping Duty Order
on Brake Rotors from the People’s
Republic of China: Calculation
Memorandum for the Preliminary
Results for Yantai Winhere Auto–Part
Manufacturing Co., Ltd. (‘‘Winhere’’)
(May 1, 2006); see also Memorandum to
the File, through Christopher D. Riker,
Program Manager, Ad/CVD Operations,
Office 9, Import Administration, from
Thomas Killiam, Analyst, AD/CVD
Operations, Office 9, Import
Administration, regarding 2004/2005
Antidumping Duty Administrative
Review of the Antidumping Duty Order
on Brake Rotors from the People’s
Republic of China: Calculation
Memorandum for the Preliminary
Results for Qingdao Meita Automotive
Industry Co., Ltd. (‘‘Meita) (May 1, 2006)
(‘‘Meita Calculation Memo’’).
Additionally, Meita was unable to
substantiate the reported carbon content
of the ferromanganese it consumes in
the production of the subject
merchandise. See Meita Verification
Report. Therefore, pursuant to section
776(a)(2)(D) of the Act, for purposes of
these preliminary results, we are
valuing this input based on the facts
available. Moreover, because we
determine that Meita failed to cooperate
by not acting to the best of its ability to
report the carbon content, pursuant to
Section 776(b) of the Act, we have
applied the higher of the two potential
surrogate values to value the
ferromanganese consumption for this
company as adverse facts available. See
Meita Calculation Memo.
Finally, we note that although Hongfa
reported bentonite and coal powder as
inputs in the sand mixing stage of
production which it believes should be
valued in overhead, company officials
explained at verification that these
items are in fact added to the sand every
time the sand is mixed, even if the sand
PO 00000
Frm 00012
Fmt 4703
Sfmt 4703
itself has been recycled. For a more
detailed explanation, see Hongfa
Verification Report. Therefore, for
purposes of these preliminary results,
we are valuing bentonite and coal
powder as raw material costs for Hongfa
using information obtained at
verification as facts available. See
Memorandum to the File, through
Christopher D. Riker, Program Manager,
AD/CVD Operations, Office 9, Import
Administration, from Thomas Killiam,
Analyst, AD/CVD Operations, Office 9,
Import Administration, regarding 2004/
2005 Antidumping Duty Administrative
Review of the Antidumping Duty Order
on Brake Rotors from the People’s
Republic of China: Calculation
Memorandum for the Preliminary
Results for Hongfa Machinery (Dalian)
Co., Ltd. (‘‘Hongfa’’) (May 1, 2006). The
Department also plans to consider
whether or not these inputs should be
valued for all of the respondents subject
to this administrative review after the
publication of these preliminary results.
Preliminary Results of Reviews
We preliminarily determine that the
following margins exist during the
period April 1, 2004, through March 31,
2005:
Individually Reviewed Exporters
2004/2005 Administrative Review
Longkou Haimeng Machinery
Co., Ltd. ..................................
Xiangfen Hengtai Brake System
Co., Ltd. ..................................
Hongfa Machinery (Dalian) Co.,
Ltd. ..........................................
Qingdao Meita Automotive Industry Company, Ltd. ..............
Yantai Winhere Auto–Part Manufacturing Co., Ltd. ...................
‘‘Sample Rate’’ Exporters
2004/2005 Administrative
Review
China National Industrial
Machinery Import & Export Corporation ............
Laizhou Automobile Brake
Equipment Co., Ltd. ......
Laizhou Hongda Auto Replacement Parts Co.,
Ltd. ................................
Laizhou City Luqi Machinery Co., Ltd. ..................
Longkou TLC Machinery
Co., Ltd. ........................
Qingdao Gren (Group) Co.
Shanxi Fengkun Metallurgical Limited Company
Shenyang Yinghao Machinery Co. ....................
E:\FR\FM\08MYN1.SGM
08MYN1
Weighted–
Average
Margin
(Percent)
10.13
43.32
22.67
0.17
0.04
‘‘Sample Rate’’
Margin
(Percent)
10.93
10.93
10.93
10.93
10.93
10.93
10.93
10.93
Federal Register / Vol. 71, No. 88 / Monday, May 8, 2006 / Notices
importer- or customer–specific ad
valorem duty assessment rates based on
the ratio of the total amount of the
dumping margins calculated for the
Zibo Golden Harvest Maexamined sales to the total entered
chinery Limited Company ..............................
10.93 value of those same sales. For certain
respondents which are being assigned
Zibo Luzhou Automobile
Parts Co., Ltd. ...............
10.93 the sample rate, we will instruct CBP to
assess antidumping duties on these
company’s entries equal to the sample
Margin
rate margin these companies receive in
PRC–Wide Rate
(Percent)
the final results, regardless of the
PRC–Wide Rate ...............
43.32 importer or customer.
We will instruct CBP to assess
We will disclose the calculations used antidumping duties on all appropriate
entries covered by this review if any
in our analysis to parties to these
proceedings within five days of the date assessment rate calculated in the final
results of this review is above de
of publication of this notice. Any
minimis. For entries of the subject
interested party may request a hearing
merchandise during the POR from
within 30 days of publication of this
companies not subject to these reviews
notice.
Interested parties who wish to request that have separate rates, we will instruct
CBP to liquidate them at the cash
a hearing or to participate if one is
deposit rate in effect at the time of entry.
requested, must submit a written
The final results of this review shall be
request to the Assistant Secretary for
the basis for the assessment of
Import Administration within 30 days
antidumping duties on entries of
of the date of publication of this notice.
merchandise covered by the final results
Requests should contain: (1) the party’s
of these reviews and for future deposits
name, address, and telephone number;
of estimated duties, where applicable.
(2) the number of participants; and (3)
a list of issues to be discussed. See 19
Cash Deposit Requirements
CFR 351.310(c).
At the completion of this new shipper
Issues raised in the hearing will be
review, either with a final rescission or
limited to those raised in case and
a notice of final results, the Department
rebuttal briefs. Case briefs from
will notify CBP that bonding will no
interested parties may be submitted not
longer be permitted to fulfill security
later than 30 days of the date of
requirements for shipments of brake
publication of this notice, pursuant to
rotors from the PRC produced and
19 CFR 351.309(c). Rebuttal briefs,
exported by SZAP that are entered, or
limited to issues raised in the case
briefs, will be due 5 days later, pursuant withdrawn from warehouse, for
consumption on or after the publication
to 19 CFR 351.309(d). Parties who
date of the final results of the new
submit case or rebuttal briefs in this
proceeding are requested to submit with shipper review. The following cash
deposit requirements will be effective
each argument (1) a statement of the
upon publication of the final results of
issue and (2) a brief summary of the
argument. Parties are also encouraged to the new shipper review for all
provide a summary of the arguments not shipments of subject merchandise from
SZAP entered, or withdrawn from
to exceed five pages and a table of
warehouse, for consumption on or after
statutes, regulations, and cases cited.
the publication date: (1) for subject
The Department will issue the final
merchandise manufactured and
results of these reviews, including the
exported by SZAP, the deposit rate will
results of its analysis of issues raised in
any such written briefs or at the hearing, continue to be the PRC–wide rate (i.e.,
43.32 percent) if the Department
if held, not later than 120 days after the
continues to determine, in the final
date of publication of this notice.
results, that the sale under review
Assessment Rates
remains non–bona fide and
The Department shall determine, and
consequently rescinds the review; and
CBP shall assess, antidumping duties on (2) for subject merchandise exported by
all appropriate entries. The Department
SZAP but not manufactured by SZAP,
will issue appropriate appraisement
the cash deposit rate will also continue
instructions for the companies subject to to be the PRC–wide rate.
this review directly to CBP within 15
The following deposit requirements
days of publication of the final results
will be effective upon publication of the
of these reviews. Pursuant to 19 CFR
final results of the administrative review
351.212(b)(1), for the companies
for all shipments of brake rotors from
selected in the sample for which we
the PRC entered, or withdrawn from
calculated a margin, we will calculate
warehouse, for consumption on or after
wwhite on PROD1PC61 with NOTICES
‘‘Sample Rate’’ Exporters
2004/2005 Administrative
Review
VerDate Aug<31>2005
‘‘Sample Rate’’
Margin
(Percent)
16:05 May 05, 2006
Jkt 208001
PO 00000
Frm 00013
Fmt 4703
Sfmt 4703
26745
the publication date, as provided by
section 751(a)(1) of the Act: (1) the cash
deposit rates for Haimeng, Hengtai,
Hongfa, Meita, Winhere, CNIM, LABEC,
Hongda, Luqi, LKTLC, GREN, Fengkun,
Yinghao, ZGOLD and ZLAP will be the
rates determined in the final results of
review (except that if a rate is de
minimis, i.e., less than 0.50 percent, no
cash deposit will be required); (2) the
cash deposit rate for PRC exporters who
received a separate rate in a prior
segment of the proceeding (which were
not reviewed in this segment of the
proceeding) will continue to be the rate
assigned in that segment of the
proceeding; (3) the cash deposit rate for
the PRC NME entity (including Huanri,
Rotec, Xianjiang/Other than Zibo) will
be 43.32 percent; and (4) the cash
deposit rate for non–PRC exporters of
subject merchandise from the PRC will
be the rate applicable to the PRC
exporter that supplied that exporter.
These requirements, when imposed,
shall remain in effect until publication
of the final results of the next
administrative review.
Notification to Importers
This notice serves as a preliminary
reminder to importers of their
responsibility under 19 CFR
351.402(f)(2) 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 the subsequent assessment
of double antidumping duties.
These administrative and new shipper
reviews and notice are in accordance
with sections 751(a)(1), 751(a)(2)(B), and
777(i) of the Act and 19 CFR 351.213
and 351.214.
Dated: May 1, 2006.
David M. Spooner,
Assistant Secretaryfor Import Administration.
[FR Doc. E6–6988 Filed 5–5–06; 8:45 am]
BILLING CODE 3510–DS–S
E:\FR\FM\08MYN1.SGM
08MYN1
]]>Agencies
[Federal Register Volume 71, Number 88 (Monday, May 8, 2006)]
[Notices]
[Pages 26736-26745]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-6988]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-846]
Brake Rotors From the People's Republic of China: Preliminary
Results and Partial Rescission of the 2004/2005 Administrative Review
and Preliminary Notice of Intent To Rescind the 2004/2005 New Shipper
Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') is currently
conducting the 2004/2005 administrative review and the 2004/2005 new
shipper review of the antidumping duty order on brake rotors from the
People's Republic of China (``PRC''). We preliminarily determine that
sales have been made below normal value (``NV'') with respect to
certain exporters who participated fully and are entitled to a separate
rate in the administrative review. We also have preliminarily
determined that the single sale made by the new shipper, Shanxi
Zhongding Auto Parts Co., Ltd.(``SZAP''), was not bona fide. If these
preliminary results are adopted in our final results of these reviews,
we will instruct U.S. Customs and Border Protection (``CBP'') to assess
antidumping duties on entries of subject merchandise during the period
of review (``POR'') for which the importer-specific assessment rates
are above de minimis.
Interested parties are invited to comment on these preliminary
results. We will issue the final results no later than 120 days from
the date of publication of this notice.
EFFECTIVE DATE: May 8, 2006.
FOR FURTHER INFORMATION CONTACT: Erin C. Begnal or Christopher D.
Riker, AD/CVD Operations, Office 9, Import Administration,
International Trade Administration, U.S. Department of Commerce, 14th
Street and Constitution Avenue, NW, Washington, DC 20230; telephone:
(202) 482-1442 or (202) 482-3441, respectively.
SUPPLEMENTARY INFORMATION:
Background
On February 19, 1999, the Department published in the Federal
Register the antidumping duty order on brake rotors from the PRC. See
Notice of Antidumping Duty Order: Brake Rotors from the People's
Republic of China, 62 FR 18740 (April 17, 1997).
On March 23, 2005, SZAP, in accordance with 19 CFR 351.214(c),
requested a new shipper review of the antidumping duty order on brake
rotors from the PRC, which has an April anniversary month. In response
to the Department's April 14, 2005, request for information, SZAP
provided supplemental information on April 29, 2005. Furthermore, on
April 29, 2005, SZAP agreed to waive the time limits of its new shipper
review of brake rotors from the PRC, pursuant to 19 CFR 351.214(j)(3),
and agreed to have its review conducted concurrently with the 2004/2005
administrative review. On May 27, 2005, the Department initiated a new
shipper review of SZAP covering the period April 1, 2004, through March
31, 2005. See Brake Rotors From the People's Republic of China:
Initiation of New Shipper Antidumping Duty Review, 70 FR 30696 (May 27,
2005).
On April 1, 2005, the Department published a notice of opportunity
to request an administrative review of the antidumping duty order on
brake rotors from the PRC. See Antidumping or Countervailing Duty
Order, Finding, or Suspended Investigation; Opportunity To Request
Administrative Review, 70 FR 16799 (April 1, 2005).
The Department received timely requests from Laizhou Auto Brake
Equipment Company (``LABEC''); Yantai Winhere Auto-Part Manufacturing
Co., Ltd. (``Winhere''); Longkou Haimeng Machinery Co., Ltd.
(``Haimeng''); Laizhou Hongda Auto Replacement Parts Co., Ltd.
(``Hongda''); Hongfa Machinery (Dalian) Co., Ltd. (``Hongfa''); Qingdao
Meita Automotive Industry Co., Ltd. (``Meita''); and Shandong Huanri
Group General Co., Laizhou Huanri Automobile Parts Co., Ltd., and
Shandong Huanri Group Co., Ltd. (Collectively, ``Huanri''), on April
27, 2005, for an administrative review of this antidumping duty order
in accordance with 19 CFR 351.213. The Department also received a
timely request for an administrative review of 26 companies (or
producer/exporter combinations),\1\ from the Coalition for the
Preservation of American Brake Drum and Rotor Aftermarket Manufacturers
(``petitioners''), on April 28, 2005.
---------------------------------------------------------------------------
\1\ The names of these exporters are as follows: (1) China
National Industrial Machinery Import & Export Corporation
(``CNIM''); (2) Laizhou Automobile Brake Equipment Factory; (3)
Qingdao Gren Co. (``Gren''); (4) Winhere; (5) Haimeng; (6) Zibo
Luzhou Automobile Parts Co., Ltd. (``ZLAP''); (7) Hongda; (8)
Hongfa; (9) Meita; (10) Shandong Huanri (Group) General Company;
(11) Longkou TLC Machinery Co., Ltd. (``LKTLC''); (12) Zibo Golden
Harvest Machinery Limited Company (``ZGOLD''); (13) Shanxi Fengkun
Metallurgical Limited Company (``Fengkun''); (14) Xianghe Xumingyuan
Auto Parts Co. (``Xumingyuan''); (15) Xiangfen Hengtai Brake System
Co., Ltd. (``Hengtai''); (16) Laizhou City Luqi Machinery Co., Ltd.
(``Luqi''); (17) Qingdao Rotec Auto Parts Co., Ltd. (``Rotec'');
(18) Shenyang Yinghao Machinery Co. (``Yinghao''); (19) Longkou
Jinzheng Maxhinery (sic) Co. (``Jinzheng''); (20) Dixion Brake
System (Longkou) Ltd. (``Dixion''); (21) Laizhou Wally Automobile
Co., Ltd. (``Wally''); (22) China National Machinery & Equipment
Import & Export (Xianjiang) Corporation and manufactured by any
company other than Zibo Botai Manufacturing Co., Ltd. (``Xianjiang/
Other than Zibo''); (23) National Automotive Industry Import &
Export Corporation or China National Automotive Industry Import &
Export Corporation, and manufactured by any company other than
Shandong Laizhou Capco Industry (``CNAIIEC/other than Capco''); (24)
Shandong Laizhou Capco Industry, and manufactured by any company
other than Shandong Laizhou Capco Industry (``Capco/other than
Capco''); (25) Laizhou Luyuan Automobile Fittings Co., and
manufactured by any company other than Laizhou Luyuan Automobile
Fittings Co., or Shenyang Honbase Machinery Co., Ltd. (``LLAFC/other
than LLAFC or Honbase''); and (26) Shenyang Honbase Machinery Co.,
Ltd., and manufactured by any company other than Laizhou Luyuan
Automobile Fittings Co., or Shenyang Honbase Machinery Co., Ltda.
(sic) (``Honbase/other than Honbase or LLAFC'').
---------------------------------------------------------------------------
On May 16, 2005, the Department received from CBP copies of customs
documents pertaining to the entry of brake rotors from the PRC exported
by SZAP during the POR. See Memorandum to the File through John
Conniff, Acting Program Manager, AD/CVD Operations, Office 9, Import
Administration, from Edward Jacobson, Analyst, AD/CVD Operations,
Office 9, Import Administration, regarding 13\th\ Antidumping New
Shipper Review of Brake Rotors from the People's Republic of China
(July 13, 2005).
On May 23, 2005, the Department initiated an administrative review
of the antidumping duty order on brake rotors from the PRC. See Notice
of Initiation of Antidumping and Countervailing Duty Administrative
Reviews and Request for Revocation in Part, 70 FR 30694 (May 27, 2005)
(``Initiation Notice''). The review was initiated for 27 individually
named firms, with a POR of April 1, 2004, through March 31, 2005.\2\
---------------------------------------------------------------------------
\2\ Note: the Department inadvertently separately initiated on
Laizhou Huanri Automobile Parts Co., Ltd. and Shangdong Huanri Group
General Co.
---------------------------------------------------------------------------
[[Page 26737]]
Of the 27 named firms for which the Department initiated an
administrative review, 18 firms indicated they had shipments of subject
merchandise during the POR that were subject to review.\3\ Two firms,
Rotec and Xianjiang/Other than Zibo, did not respond to the
Department's request for information relating to whether or not the
firm had shipments subject to the review. See Memorandum to the File
from Edward Jacobson, Analyst, AD/CVD Operations, Office 9, Import
Adminisitration, regarding confirmation of delivery of Department
questionnaire to Qingdao Rotec Auto Parts Co. Ltd. (June 30, 2005); see
also Letter to China National Industrial Machinery Import & Export
Corporation from Carrie Blozy, Program Manager, AD/CVD Operations,
Office 9, Import Administration, regarding Quantity and Value Response
(July 13, 2004). Furthermore, two of the 18 firms, Dixion and Wally,
were also participating in ongoing new shipper reviews. See Brake
Rotors From the People's Republic of China: Final Results of the
Twelfth New Shipper Review, 71 FR 4112 (January 25, 2006). After
consultations, these two companies agreed to a rescission of their
administrative reviews in accordance with 19 CFR 351.214(j). See
Memorandum to the File from Carrie Blozy, Program Manager, AD/CVD
Operations, Office 9, Import Administration, regarding the 8th
Administrative Review of Brake Rotors from the People's Republic of
China, (July 28, 2005). As a result, this administrative review covers
16 participating firms.
---------------------------------------------------------------------------
\3\ The firms which indicated they did not have shipments
subject to the review were: Jinzheng (June 21, 2005), Xumingyuan
(June 24, 2005), CNAIIEC/other than Capco (July 6, 2005), Capco/
other than Capco (July 6, 2005), LLAFC/other than LLAFC or Honbase
(July 6, 2005), and Honbase/other than Honbase or LLAFC (July 6,
2005).
---------------------------------------------------------------------------
Due to the large number of participating firms subject to this
administrative review, and the Department's experience regarding the
administrative burden to review each company for which a request was
made, the Department exercised its authority to limit the number of
respondents selected for individual review by sampling. On June 7,
2005, the Department issued letters to all firms named in the
Initiation Notice requesting information on the quantity and value of
sales of subject merchandise to the United States (Q&V) during the POR.
See letter to ``All Interested Parties'' from James C. Doyle, Director,
AD/CVD Operations, Office 9, Import Administration (June 7, 2005).
Subsequent letters were sent to potential respondents and the
petitioners to clarify Q&V information covered by this administrative
review on July 7, July 8, July 11, and September 15, 2005.
On October 14, 2005, the Department determined that a
``probability-proportional-to-size'' sampling methodology was the most
appropriate approach to limit the selection of respondents in this
review. See Letter to ``All Interested Parties'' from James C. Doyle,
Director, AD/CVD Operations, Office 9, Import Administration (October
14, 2005). Further, the Department invited comments on the economic,
legal, and administrative considerations of the proposed sampling
method, pursuant to section 777A(b) of the Tariff Act of 1930, as
amended (``the Act''). On October 24, 2005, the Department received
comments on the proposed sampling methodology from the petitioners and
from LABEC, Winhere, Haimeng, Hongda, Hongfa, Meita, Luqi and Huanri.
The Department conducted the sampling on November 16, 2005. See
Section 777A(c)(2) of the Act; see also Memorandum to the File through
Christopher Riker, Program Manager, AD/CVD Operations, Office 9, Import
Administration, from Erin Begnal, Analyst, AD/CVD Operations, Office 9,
Import Administration, regarding sampling procedure results in the
Antidumping Duty Administrative Review: Brake Rotors from the People's
Republic of China (November 16, 2005) (``Sampling Procedure Results
Memo''). The following respondents were selected for individual review
pursuant to the sampling procedure: Meita, Winhere, Hengtai, Hongfa,
and Haimeng. See Sampling Procedure Results Memo; see also Memorandum
to the File through Christopher Riker, Program Manager, AD/CVD
Operations, Office 9, Import Administration, from Erin Begnal, Analyst,
AD/CVD Operations, Office 9, Import Administration, regarding sampling
procedure disclosure for the Antidumping Duty Administrative Review:
Brake Rotors from the People's Republic of China (November 16, 2005);
Memorandum to Stephen J. Claeys, Deputy Assistant Secretary for Import
Administration, from James C. Doyle, Director, AD/CVD Operations,
Office 9, Import Administration, regarding Selection of Respondents for
the 2004/2005 Antidumping Administrative Review of Brake Rotors from
the People's Republic of China (December 19, 2005) (where the
Department also addressed certain comments received on the Department's
sampling methodology).
On December 20, 2005, the Department published in the Federal
Register a notice of postponement of the preliminary results until no
later than May 1, 2006. See Brake Rotors from the People's Republic of
China: Extension of Time Limit for Preliminary Results of Antidumping
Duty Administrative Review and New Shipper Review, 70 FR 75448
(December 20, 2005).
Respondents
On November 23, 2005, we issued antidumping duty questionnaires to
Haimeng, Hengtai, Hongfa, Meita, and Winhere. On November 28, 2005, the
Department sent a description of the products under review to the five
aforementioned companies. See letters to Haimeng, Hengtai, Hongfa,
Meita, and Winhere from Christopher Riker, Program Manager, China/NME
Group, Office 9, Import Administration, regarding Antidumping Duty
Administrative Review: Brake Rotors from the People's Republic of China
(04/01/04-03/31/05), (November 28, 2005).
On December 16, 2005, the Department invited parties to submit
comments on the selection of a surrogate country and to submit publicly
available information for purposes of calculating normal value. See
letter to ``All Interested Parties'' from Christopher D. Riker, Program
Manager, AD/CVD Operations 9, Import Administration, regarding
Administrative Review and New Shipper Review of Brake Rotors from the
People's Republic of China: Office of Policy list of Economically
Comparable Countries and Schedule for Comments on Surrogate Country
(December 16, 2005).
On December 21, 2005, we received section A responses from Haimeng,
Hengtai, Hongfa, Meita, and Winhere. On December 30, 2005, the
Department issued supplemental section A questionnaires to Haimeng,
Hengtai, Hongfa, Meita, and Winhere. On January 6, 2006, we received
sections C and D responses from Haimeng, Hongfa, Meita, and Winhere,
and on January 10, 2006, we received the sections C and D responses
from Hengtai. On January 11, 2006, we received comments from
petitioners on the reconciliation responses submitted by Winhere, Meita
and Haimeng.
On January 17, 2006, Hengtai submitted its response to the
Department's supplemental section A questionnaire. On January 19, 2006,
the Department issued a supplemental sections C and D questionnaire to
Hongfa, and issued supplemental sections C and D questionnaires to
Haimeng, Hengtai, Meita, and Winhere
[[Page 26738]]
the following day (i.e., January 20, 2006). On January 24, 2006, we
received supplemental section A responses from Haimeng, Hongfa, Meita
and Winhere, and on February 13, 2006, we received supplemental
sections C and D responses from Haimeng, Hengtai, Hongfa, Meita and
Winhere.
The Department has a rebuttable presumption that a single dumping
margin is appropriate for all exporters in an NME country. However, the
Department considers information submitted in response to Departmental
questionnaires in order to determine whether or not respondents qualify
for a separate rate. On January 10, 2006, the Department issued section
A questionnaires to CNIM, LABEC, Gren, ZLAP, Hongda, Huanri, Longkou
TLC, ZGOLD, Fengkun, Luqi and Yinghao in order to determine whether or
not they qualify for a separate rate.
On January 30, 2006, we received section A responses from ZGOLD and
ZLAP. On January 31, 2006, we received a section A response from
Longkou TLC. On February 3, 2006, we received section A responses from
Hongda, Huanri, LABEC, and Luqi. On February 8, 2006, we received
section A responses from CNIM, GREN, Fengkun and Yinghao. On February
10, 2006, the Department issued a supplemental section A questionnaire
to Huanri. On February 13, 2006, Hongda provided a CBP entry summary
that was not included in its February 3, 2006, section A response. In
addition to the supplemental questionnaire issued to Huanri, we sent
supplemental section A questionnaires to LABEC, Luqi, ZGOLD and ZLAP on
February 15, 2006; Longkou TLC and Yinghao on February 22, 2006; CNIM
on February 23, 2006; Fengkun and GREN on March 2, 2006; and Hongda on
March 16, 2006.
On February 22, 2006, we received a response to our supplemental
section A questionnaire from Huanri. On February 27, 2006, we received
responses to our supplemental section A questionnaires from LABEC,
Luqi, ZGOLD, and ZLAP. On March 2, 2006, we received a supplemental
section A response from Longkou TLC. On March 6, 2006, we received
supplemental section A responses from CNIM and Yinghao. We also
received supplemental section A responses from GREN and Fengkun on
March 14, 2006 and from Hongda on March 28, 2006.
On February 14, 2006, the Department issued verification outlines
to Meita, Winhere and Huanri. The Department conducted verification of
the responses of Winhere from February 27 through March 1, 2006 and
Meita from March 2 through 4, 2006. Huanri cancelled verification one
day before it was set to commence. See letter from Huanri regarding
cancellation of verification (March 8, 2006). On March 3, 2006, the
Department issued a verification outline to Hongfa; the Department
issued a verification outline to SZAP on March 7, 2006. On March 6,
2006, Meita submitted minor corrections presented at verification. The
Department conducted verification of the responses of Hongfa from March
13 through 15, 2006, and SZAP from March 22 through 24, 2006.
On March 16, 2006, petitioners submitted publicly available
information for use in the calculation of normal value in the
administrative and new shipper reviews. Also, on March 16, 2006,
Haimeng, Hongfa, Meita, Winhere, LABEC, Hongda, and Luqi submitted
publicly available information for use in the calculation of normal
value in the administrative review. On March 27, 2006, petitioners
submitted rebuttal comments to the aforementioned respondents' March
16, 2006, filing. On April 13, 2006, Haimeng, Hongfa, Meita, Winhere,
LABEC, Hongda, and Luqi submitted additional publicly available
information for consideration in valuing brokerage and handling.
On April 20, 2006, the Department released the verification reports
for Hongfa, Meita and Winhere. See Verification of the Sales and
Factors Response of Qingdao Meita Automotive Industry Co., Ltd. in the
Antidumping Administrative Review of Brake Rotors from the People's
Republic of China (April 20, 2006) (``Meita Verification Report'');
Verification of the Sales and Factors Response of Yantai Winhere Auto-
Part Manufacturing Co., Ltd. in the Antidumping Administrative Review
of Brake Rotors from the People's Republic of China (April 20, 2006)
(``Winhere Verification Report''); Verification of the Sales and
Factors Response of Hongfa Machinery (Dalian) Co., Ltd. in the
Antidumping Administrative Review of Brake Rotors from the People's
Republic of China (April 20, 2006) (``Hongfa Verification Report''). On
April 26, 2006, the Department released the verification report for
SZAP. See Verification of the Sales and Factors Response of Shanxi
Zhongding Auto Parts Co., Ltd. in the New Shipper Review of Brake
Rotors from the People's Republic of China (April 26, 2006) (``SZAP
Verification Report'').
Surrogate Country and Factors
As previously stated, on December 16, 2005, the Department provided
parties an opportunity to submit publicly available information
(``PAI'') on surrogate countries and values for consideration in these
preliminary results. As previously indicated, the Department received
comments on March 16, 2006, March 27, 2006, and April 13, 2006.
Scope of the Order
The products covered by this order are brake rotors made of gray
cast iron, whether finished, semifinished, or unfinished, ranging in
diameter from 8 to 16 inches (20.32 to 40.64 centimeters) and in weight
from 8 to 45 pounds (3.63 to 20.41 kilograms). The size parameters
(weight and dimension) of the brake rotors limit their use to the
following types of motor vehicles: automobiles, all-terrain vehicles,
vans and recreational vehicles under ``one ton and a half,'' and light
trucks designated as ``one ton and a half.''
Finished brake rotors are those that are ready for sale and
installation without any further operations. Semi-finished rotors are
those on which the surface is not entirely smooth, and have undergone
some drilling. Unfinished rotors are those which have undergone some
grinding or turning.
These brake rotors are for motor vehicles, and do not contain in
the casting a logo of an original equipment manufacturer (``OEM'')
which produces vehicles sold in the United States. (e.g., General
Motors, Ford, Chrysler, Honda, Toyota, Volvo). Brake rotors covered in
this order are not certified by OEM producers of vehicles sold in the
United States. The scope also includes composite brake rotors that are
made of gray cast iron, which contain a steel plate, but otherwise meet
the above criteria. Excluded from the scope of this order are brake
rotors made of gray cast iron, whether finished, semifinished, or
unfinished, with a diameter less than 8 inches or greater than 16
inches (less than 20.32 centimeters or greater than 40.64 centimeters)
and a weight less than 8 pounds or greater than 45 pounds (less than
3.63 kilograms or greater than 20.41 kilograms).
Brake rotors are currently classifiable under subheading
8708.39.5010 of the Harmonized Tariff Schedule of the United States
(``HTSUS''). Although the HTSUS subheading is provided for convenience
and customs purposes, the written description of the scope of this
order is dispositive.
Verification
On August 31, 2005, petitioners requested that the Department
conduct verification of the data submitted by all of the firms for
which the Department initiated an administrative review, as
[[Page 26739]]
well as SZAP. However, due to the Department's resource constraints in
conducting these reviews, we only selected Hongfa, Huanri, Meita,
Winhere and SZAP for verification pursuant to Section 782(i)(2) of the
Act and 19 CFR 351.307. As noted above, Huanri cancelled its
verification a day prior to its scheduled commencement. See letter from
Huanri regarding cancellation of verification (March 8, 2006).
For the companies we did verify, we used standard verification
procedures, including on-site inspection of the manufacturers' and
exporters' facilities, and examination of relevant sales and financial
records. Our verification results are outlined in the verification
report for each company. For a further discussion, see the Meita
Verification Report, the Winhere Verification Report, the Hongfa
Verification Report, and the SZAP Verification Report.
Preliminary Partial Rescission of 2004/2005 Administrative Review
With respect to Jinzheng, Xumingyuan, CNAIIEC/other than Capco,
Capco/other than Capco, LLAFC/other than LLAFC or Honbase, and Honbase/
other than Honbase or LLAFC, each has informed the Department that it
did not export the subject merchandise to the United States during the
POR in the combinations referenced above, where applicable.
Specifically, (1) neither Jinzheng nor Xumingyuan exported subject
merchandise to the United States during the POR; (2) CNAIIEC did not
export brake rotors to the United States that were manufactured by
producers other than Capco; (3) Capco did not export brake rotors to
the United States that were manufactured by producers other than Capco;
(4) LLAFC did not export brake rotors to the United States that were
manufactured by producers other than LLAFC or Honbase; and (5) Honbase
did not export brake rotors to the United States that were manufactured
by producers other than Honbase or LLAFC. In order to corroborate these
submissions, we reviewed PRC brake rotor shipment data maintained by
CBP, and noted no discrepancies with the statements made by these
firms.
Furthermore, on July 28, 2005, Dixion and Wally noted, in
accordance with section 351.214(j) of the Department's regulations,
that their ongoing new shipper reviews covered all of their subject
merchandise exports which would be subject to this administrative
review. After consulting with both, Wally and Dixon agreed to a
rescission of their administrative reviews. See Memorandum to the File
from Carrie Blozy, Program Manager, AD/CVD Operations, Office 9, Import
Administration, regarding the 8th Administrative Review of Brake Rotors
from the People's Republic of China, (July 28, 2005).
Therefore, for the reasons mentioned above, we are preliminarily
rescinding the administrative review with respect to Jinzheng,
Xumingyuan, CNAIIEC/other than Capco, Capco/other than Capco, LLAFC/
other than LLAFC or Honbase, Honbase/other than Honbase or LLAFC, and
Dixion and Wally because we either found no evidence that any of these
companies made shipments of the subject merchandise during the POR, in
accordance with 19 CFR 351.213(d)(3), or these companies consented to a
rescission of the administrative review pursuant to 19 CFR 351.214(j).
Bona Fide Sale Analysis--SZAP
For the reasons stated below, we preliminarily find that SZAP's
reported U.S. sale during the POR does not appear to be a bona fide
sale, based on the totality of the facts on the record. See Glycine
From The People's Republic of China: Rescission of Antidumping Duty New
Shipper Review of Hebei New Donghua Amino Acid Co., Ltd., 69 FR 47405,
47406 (August 5, 2004). Specifically, we find that: 1) the difference
in the sales price of SZAP's single POR sale as compared to the prices
of its subsequent sales, 2) the quantity of its single POR sale as
compared to its subsequent sales, 3) questionable sales documentation
pertaining to SZAP's U.S. sale; and finally, 4) other indicia of a non-
bona fide transaction, all demonstrate that the single sale under
review was not bona fide. Therefore, this sale does not provide a
reasonable or reliable basis for calculating a dumping margin.
For the reasons mentioned above, the Department preliminarily finds
that SZAP's sole U.S. sale during the POR was not a bona fide
commercial transaction and is preliminarily rescinding the new shipper
review of SZAP. For a more detailed analysis, see Memorandum to James
C. Doyle, Director, AD/CVD Operations, Office 9, Import Administration,
through Christopher D. Riker, Program Manager, AD/CVD Operations,
Office 9, from Erin C. Begnal, Analyst, AD/CVD Operations, Office 9,
regarding Bona Fides Analysis and Intent to Rescind New Shipper Review
of Brake Rotors from the People's Republic of China for Shanxi
Zhongding Auto Parts Co., Ltd. (May 1, 2006).
Non-Market Economy Country
In every case conducted by the Department involving the PRC, the
PRC has been treated as a non-market economy (``NME'') country.
Pursuant to section 771(18)(C)(i) of the Act, any determination that a
foreign country is a NME country shall remain in effect until revoked
by the administering authority. See, e.g., Freshwater Crawfish Tail
Meat from the People's Republic of China: Notice of Final Results of
Antidumping Duty Administrative Review, 71 FR 7013 (February 10, 2006).
None of the parties to this proceeding has contested such treatment.
Accordingly, we calculated NV in accordance with section 773(c) of the
Act, which applies to NME countries.
Surrogate Country
Section 773(c)(4) of the Act requires the Department to value an
NME producer's factors of production, to the extent possible, in one or
more market-economy countries that (1) are at a level of economic
development comparable to that of the NME country, and (2) are
significant producers of comparable merchandise. India is among the
countries comparable to the PRC in terms of overall economic
development. See Letter to ``All Interested Parties'' from Christopher
D. Riker, Program Manager, AD/CVD Operations 9, regarding
Administrative Review and New Shipper Review of Brake Rotors from the
People's Republic of China: Office of Policy list of Economically
Comparable Countries and Schedule for Comments on Surrogate Country at
Attachment I (December 16, 2005). In addition, based on publicly
available information placed on the record (e.g., export data), India
is a significant producer of the subject merchandise. See Memorandum to
James C. Doyle, Director, AD/CVD Operations, Office 9, Import
Administration, through Christopher D. Riker, Program Manager, AD/CVD
Operations, Office 9, from Michael Quigley, Analyst, AD/CVD Operations,
Office 9, regarding 2004-2005 Antidumping Duty Administrative Review
and New Shipper Review of Brake Rotors from the People's Republic of
China: Selection of a Surrogate Country (May 1, 2006). Accordingly, we
have selected India as the primary surrogate country for purposes of
valuing the factors of production because it meets the Department's
criteria for surrogate-country selection. See Id.
[[Page 26740]]
Facts Available--Hengtai, Rotec and Xianjiang/Other than Zibo
For the reasons outlined below, we have applied total adverse facts
available to Hengtai, Rotec and Xianjiang/Other than Zibo.
At the verification of SZAP, we found email correspondence between
SZAP and Hengtai from the POR which indicated that SZAP produced brake
rotors that were sold by Hengtai, and that Hengtai also purchased brake
rotors from SZAP. Hengtai did not report that SZAP was a supplier
during the POR and therefore there is no indication that Hengtai
accurately reported its factors of production including SZAP's factors
of production, as required. In addition, there is no indication that
Hengtai included sales of subject merchandise manufactured by SZAP in
its U.S. sales database, thereby understating its total U.S. sales.
Because these findings directly contradict statements made on the
record by Hengtai that Hengtai produced all of the subject merchandise
that it sold during the POR, we find that Hengtai did not provide the
Department with accurate or complete data pursuant to section 776(a)(2)
of the Act. Specifically, section 776(a)(2) of the Act provides that,
if an interested party: (A) withholds information that has been
requested by the Department, (B) fails to provide such information in a
timely manner or in the form or manner requested subject to sections
782(c)(1) and (e) of the Act, (C) significantly impedes a proceeding
under the antidumping statute, or (D) provides such information but the
information cannot be verified, the Department shall, subject to
section 782(d) of the Act, use facts otherwise available in reaching
the applicable determination.
The evidence discovered at SZAP's verification suggests Hengtai
likely sold subject merchandise produced by SZAP to the United States.
If so, Hengtai should have reported U.S. sales of merchandise produced
by SZAP as well as SZAP's factors of production in conjunction with its
own. Because evidence obtained by the Department indicates that
Hengtai's reported factors of production data certainly, and U.S. sales
data likely, is incomplete, we have no choice but to apply facts
available to Hengtai.
Furthermore, section 776(b) of the Act states that if the
Department ``finds that an interested party has failed to cooperate by
not acting to the best of its ability to comply with a request for
information from the administering authority or the Commission, the
administering authority or the Commission . . ., in reaching the
applicable determination under this title, may use an inference that is
adverse to the interests of that party in selecting from among the
facts otherwise available.'' See also Statement of Administrative
Action accompanying the URAA, H.R. Rep. No. 103-316 at 870 (1994)
(``SAA''). Because Hengtai withheld information in its possession and
failed to do its utmost in response to the Department's questions, the
Department is applying total adverse facts available to Hengtai. See
Memorandum to James C. Doyle, Director, AD/CVD Operations, Office 9,
Import Administration , through Christopher D. Riker, Program Manager,
AD/CVD Operations, Office 9, Import Administration, from Erin C.
Begnal, Case Analyst, AD/CVD Operations, Office 9, Import
Administration, regarding 2004/2005 Antidumping Administrative Review
of Brake Rotors from the People's Republic of China: Preliminary
Application of Adverse Facts Available to Xiangfen Hengtai Brake System
Co., Ltd., (May 1, 2006) for further discussion on the application of
adverse facts available to Hengtai.
The Department mailed Q&V questionnaires to Rotec and Xianjiang/
Other than Zibo on June 7, 2005. However, both Rotec and Xianjiang/
Other than Zibo failed to respond to the Department's Q&V
questionnaire. By not responding to the Department's Q&V questionnaire,
Rotec and Xianjiang/Other than Zibo failed to provide critical
information to be used for the Department's respondent selection
process. Pursuant to sections 776(a) and (b) of the Act, the Department
may apply adverse facts available if it finds a respondent has failed
to cooperate by not acting to the best of its ability to comply with a
request for information from the Department. By failing to respond to
the Department's Q&V questionnaire, Rotec and Xianjiang/Other than Zibo
have failed to act to the best of their ability in this segment of the
proceeding.
In addition, because Rotec and Xianjiang/Other than Zibo did not
participate in the respondent selection exercise, the Department did
not send them a questionnaire and was unable to determine whether or
not they qualified for a separate rate. Therefore, Rotec and Xianjiang/
Other than Zibo are not eligible to receive a separate rate and will be
part of the PRC-wide entity, subject to the PRC-wide rate. Pursuant to
section 776(b) of the Act, we have applied total adverse facts
available with respect to the PRC-wide entity, including, among others,
Rotec and Xianjiang/Other than Zibo.
In this segment of the proceeding, in accordance with Department
practice (see, e.g., Brake Rotors from the People's Republic of China:
Rescission of Second New Shipper Review and Final Results and Partial
Rescission of First Antidumping Duty Administrative Review, 64 FR
61581, 61584 (November 12, 1999), as adverse facts available, we have
assigned to exports of the subject merchandise by Rotec and Xianjiang/
Other than Zibo a rate of 43.32 percent, which is the PRC-wide rate.
Corroboration of Facts Available
Section 776(c) of the Act requires that the Department corroborate,
to the extent practicable, a figure which it applies as facts
available. To be considered corroborated, information must be found to
be both reliable and relevant. We are applying as adverse facts
available (``AFA'') the highest rate from any segment of this
administrative proceeding, which is the rate currently applicable to
all exporters subject to the PRC-wide rate. The information upon which
the AFA rate is based in the current review (i.e., the PRC-wide rate of
43.32 percent) was the highest rate from the petition in the LTFV
investigation. See Notice of Antidumping Duty Order: Brake Rotors from
the People's Republic of China, 62 FR 18740 (April 17, 1997). This AFA
rate is the same rate which the Department assigned to brake rotor
companies in prior reviews and the rate itself has not changed since
the original LTFV determination. See, e.g., Brake Rotors From the
People's Republic of China: Final Results and Partial Rescission of the
Seventh Administrative Review: Final Results of the Eleventh New
Shipper Review, 70 FR at 69937 (November 18, 2005) (Brake Rotors 7\th\
Review Final Results). For purposes of corroboration, the Department
will consider whether that margin is both reliable and relevant. The
AFA rate we are applying for the current review was corroborated in
reviews subsequent to the LTFV investigation to the extent that the
Department referred to the history of corroboration. Furthermore, no
information has been presented in the current review that calls into
question the reliability of this information.
With respect to the relevance aspect of corroboration, the
Department will consider information reasonably at its disposal to
determine whether a margin continues to have relevance. Where
circumstances indicate that the selected margin is not appropriate as
AFA, the Department will disregard the margin and determine an
appropriate margin. For example, in Fresh Cut Flowers from
[[Page 26741]]
Mexico; Final Results of Antidumping Administrative Review, 61 FR 6812
(February 22, 1996), the Department disregarded the highest margin in
that case as adverse best information available (the predecessor to
facts available) because the margin was based on another company's
uncharacteristic business expense resulting in an unusually high
margin. The information used in calculating this margin was based on
sales and production data submitted by the petitioner in the LTFV
investigation, together with the most appropriate surrogate value
information available to the Department chosen from submissions by the
parties in the LTFV investigation, as well as information gathered by
the Department itself. Furthermore, the calculation of this margin was
subject to comment from interested parties in the proceeding. Moreover,
as there is no information on the record of this review that
demonstrates that this rate is not appropriately used as AFA, we
determine that this rate has relevance.
As the 43.32 percent rate is both reliable and relevant, we
determine that it has probative value. Accordingly, we determine that
the calculated rate of 43.32 percent, which is the current PRC-wide
rate, is in accord with the requirement of section 776(c) that
secondary information be corroborated to the extent practicable (i.e.,
that it have probative value). We have assigned this AFA rate to
exports of the subject merchandise by the PRC-wide entity, including
Rotec and Xianjiang/Other than Zibo.
Separate Rates
In proceedings involving NME countries, the Department begins with
a rebuttable presumption that all companies within the country are
subject to government control and thus should be assessed a single
antidumping duty deposit rate (i.e., a PRC-wide rate).
Of the 16 respondents participating in these reviews, four of the
PRC companies (i.e., Hongfa, Meita, Winhere and Yinghao) are owned
wholly by entities located in market-economy countries. Thus, for these
four companies, because we have no evidence indicating that they are
under the control of the PRC government, a separate rates analysis is
not necessary to determine whether they are independent from government
control. See, e.g., Brake Rotors from the People's Republic of China:
Final Results and Partial Rescission of Fifth New Shipper Review, 66 FR
44331 (August 23, 2001); see also Notice of Final Determination of
Sales at Less Than Fair Value: Creatine Monohydrate from the People's
Republic of China, 64 FR 71104 (December 20, 1999).
The remaining 12 respondents (i.e., Haimeng, Hengtai, CNIM, LABEC,
Gren, ZLAP, Hongda, Huanri, Longkou TLC, ZGOLD, Fengkun, and Luqi) are
either joint ventures between PRC and foreign companies, collectively-
owned enterprises and/or limited liability companies in the PRC. Thus,
for these 12 respondents, a separate rates analysis is necessary to
determine whether the export activities of each above-mentioned
respondent is independent from government control. See Notice of Final
Determination of Sales at Less Than Fair Value: Bicycles From the
People's Republic of China, 61 FR 19026 (April 30, 1996)
(``Bicycles''). To establish whether a firm is sufficiently independent
in its export activities from government control to be entitled to a
separate rate, the Department utilizes a test arising from the Final
Determination of Sales at Less Than Fair Value: Sparklers from the
People's Republic of China, 56 FR 20588 (May 6, 1991) (``Sparklers'');
See also Final Determination of Sales at Less Than Fair Value: Silicon
Carbide from the People's Republic of China, 59 FR 22585 (May 2, 1994)
(``Silicon Carbide''), where the Department adapted and amplified the
separate rates test set out in Sparklers. Under the separate-rates
criteria, the Department assigns separate rates in NME cases only if
the respondent can demonstrate the absence of both de jure and de facto
governmental control over its export activities.
1. De Jure Control
Evidence supporting, though not requiring, a finding of de jure
absence of government control over export activities includes: (1) an
absence of restrictive stipulations associated with the individual
exporter's business and export licenses; (2) any legislative enactments
decentralizing control of companies; and (3) any other formal measures
by the government decentralizing control of companies.
Haimeng, Hengtai, CNIM, LABEC, Gren, ZLAP, Hongda, Huanri, Longkou
TLC, ZGOLD, Fengkun, and Luqi have each placed on the administrative
record documents to demonstrate an absence of de jure control (e.g.,
the 1994 ``Foreign Trade Law of the People's Republic of China,'' and
the 1999 ``Company Law of the People's Republic of China'').
As in prior cases, we have analyzed the laws presented to us and
have found them to establish sufficiently an absence of de jure control
over joint ventures between the PRC and foreign companies, and limited
liability companies in the PRC. See, e.g., Final Determination of Sales
at Less than Fair Value: Furfuryl Alcohol from the People's Republic of
China, 60 FR 22544 (May 8, 1995) (``Furfuryl Alcohol''); Preliminary
Determination of Sales at Less Than Fair Value: Certain Partial-
Extension Steel Drawer Slides with Rollers from the People's Republic
of China, 60 FR 29571 (June 5, 1995). We have no new information in
this proceeding which would cause us to reconsider this determination
with regard to Haimeng, Hengtai, CNIM, LABEC, Gren, ZLAP, Hongda,
Huanri, Longkou TLC, ZGOLD, Fengkun, and Luqi.
2. De Facto Control
As stated in previous cases, there is evidence that certain
enactments of the PRC central government have not been implemented
uniformly among different sectors and/or jurisdictions in the PRC. See
Silicon Carbide; see also Furfuryl Alcohol. Therefore, the Department
has determined that an analysis of de facto control is critical in
determining whether the respondents are, in fact, subject to a degree
of governmental control which would preclude the Department from
assigning separate rates.
The Department typically considers four factors in evaluating
whether each respondent is subject to de facto governmental control of
its export functions: (1) whether the export prices are set by, or
subject to the approval of, a governmental authority; (2) whether the
respondent has authority to negotiate and sign contracts and other
agreements; (3) whether the respondent has autonomy from the government
in making decisions regarding the selection of management; and (4)
whether the respondent retains the proceeds of its export sales and
makes independent decisions regarding the disposition of profits or
financing of losses. See Silicon Carbide; see also Furfuryl Alcohol.
Haimeng, Hengtai, CNIM, LABEC, Gren, ZLAP, Hongda, Huanri, Longkou
TLC, ZGOLD, Fengkun, and Luqi have each asserted the following: (1) it
establishes its own export prices; (2) it negotiates contracts without
guidance from any governmental entities or organizations; (3) it makes
its own personnel decisions; and (4) it retains the proceeds of its
export sales, uses profits according to its business needs, and has the
authority to sell its assets and to obtain loans. Additionally, each of
these companies' questionnaire responses indicates that its pricing
[[Page 26742]]
during the POR does not suggest coordination among exporters.
Consequently, with the exception of Huanri (as discussed below), we
have preliminarily determined that Haimeng, Hengtai, CNIM, LABEC, Gren,
ZLAP, Hongda, Huanri, Longkou TLC, ZGOLD, Fengkun, and Luqi have each
met the criteria for the application of separate rates based on the
documentation each of these respondents has submitted on the record of
these reviews. See Memorandum to James C. Doyle, Director, AD/CVD
Enforcement, Office 9, from Christopher D. Riker, Program Manager, AD/
CVD Enforcement, Office 9, Import Administration, regarding 2004/2005
Administrative Review of Brake Rotors from the People's Republic of
China: Separate Rates Analysis for Respondents (Including Exporters Not
Being Individually Reviewed) (May 1, 2006).
With respect to Huanri, the Department preliminarily finds that it
has not demonstrated a de facto absence of government control with
respect to making its own decisions in key personnel selections, the
use of its profits from the proceeds of export sales, and the authority
to negotiate and sign contracts and other agreements. See Silicon
Carbide. Huanri is therefore not entitled to a separate rate.
As noted above, on March 8, 2006, Huanri filed a letter with the
Department indicating that it wished to cancel the scheduled
verification before it began. Huanri acknowledged in this letter that
it understood, because of the verification cancellation, that the
Department may find the company has not cooperated to the best of its
ability pursuant to section 776(b) of the Act.
Section 776(a)(2)(C) of the Tariff Act of 1930, as amended (the
``Act''), provides that, if an interested party ``provides such
information but the information cannot be verified, the Department
shall, subject to section 782(d) of the Act, use facts otherwise
available in reaching the applicable determination.'' Because the
Department could not verify the information submitted by Huanri
regarding its formation and ownership, that information cannot serve as
the basis for the Department's determination regarding Huanri's
eligibility for a separate rate. Moreover, because information
concerning Huanri's submissions were unverifiable, Huanri has failed to
demonstrate that it: (1) sets its own export prices independent of the
government and without the approval of a government authority; (2) has
authority to negotiate and sign contracts, and other agreements; (3)
has autonomy from the government in making decisions regarding the
selection of its management; and (4) retains the proceeds of its export
sales and makes independent decisions regarding disposition of profits
or financing of losses. See Sparklers. Therefore, as facts available,
and because Huanri failed to satisfy its administrative burden, we
preliminarily find that Huanri should properly be considered part of
the PRC-wide entity and be subject to the PRC-wide rate.
Fair Value Comparisons
To determine whether sales of the subject merchandise by Haimeng,
Hongfa, Meita, and Winhere to the United States were made at prices
below normal value (``NV''), we compared each company's export prices
(``EPs'') or constructed export prices (``CEPs'') to NV, as described
in the ``Export Price,'' ``Constructed Export Price,'' and ``Normal
Value'' sections of this notice, below.
Export Price
For each respondent, we used EP methodology in accordance with
section 772(a) of the Act for sales in which the subject merchandise
was first sold prior to importation by the exporter outside the United
States directly to an unaffiliated purchaser in the United States and
for sales in which CEP was not otherwise indicated. We made the
following company-specific adjustments:
A. Haimeng, Hongfa, Meita, and Winhere
We calculated EP based on packed, FOB or CIF foreign port prices to
the first unaffiliated purchaser in the United States. Where
appropriate, we made deductions from the starting price (gross unit
price) for foreign inland freight and foreign brokerage and handling
charges in the PRC, and international freight, in accordance with
section 772(c) of the Act. Because foreign inland freight and foreign
brokerage and handling fees were provided by PRC service providers or
paid for in renminbi, we based those charges on surrogate rates from
India. See ``Surrogate Country'' section below for further discussion
of our surrogate-country selection.
To value foreign brokerage and handling expenses, we used publicly
summarized or ``ranged'' expense data submitted during the past year by
Indian companies in connection with other antidumping duty
administrative reviews conducted by the Department.\4\
---------------------------------------------------------------------------
\4\ We used data from the public version of the February 28,
2005, Section C response of Essar Steel Limited in the antidumping
duty administrative review of certain hot-rolled carbon steel flat
products from India, which covers the period December 1, 2003,
through November 30, 2004. We also used information from Agro Dutch
Industries Ltd., taken from the administrative review of preserved
mushrooms from India, for which the POR was February 1, 2004 through
January 31, 2005. See Certain Hot-Rolled Carbon Steel Flat Products
From India: Preliminary Results of Antidumping Duty Administrative
Review, 71 FR 2018 (January 12, 2006); see also Certain Preserved
Mushrooms From India: Final Results of Antidumping Duty
Administrative Review, 71 FR 10646 (March 2, 2006).
---------------------------------------------------------------------------
In determining the most appropriate surrogate values to use in a
given case, the Department's stated practice is to use investigation or
review period-wide price averages, prices specific to the input in
question, prices that are net of taxes and import duties, prices that
are contemporaneous with the period of investigation or review, and
publicly available data. The data we used for brokerage and handling
expenses fulfill all of the foregoing criteria except that they are not
specific to the subject merchandise: there is no information of that
type on the record of this review.
The information we used corresponds in part to what the petitioners
placed on the record for this expense category. However, we did not use
part of the petitioners' information (i.e., information from Pidilite
Industries Ltd.) which stemmed from an earlier case because it is not
contemporaneous with the POR in the instant case. We also did not use
some of the information submitted by respondents Haimeng, Hongfa,
Meita, Winhere, LABEC, Hongda, and Luqi because it is not clear what
the information represents, e.g., what time period it was taken from,
whereas, as noted by petitioners, the Indian data we are using are per
kilogram values paid by market economy companies and are representative
of these Indian companies' actual practices during the POR.
We used a simple average of two companies' brokerage expense data
in order to achieve a more representative value than a single source
would provide. Both sources are of equal quality and are
contemporaneous with the POR. See Bicycles (on using a simple, as
opposed to a weighted, average in the calculation of financial ratios).
Two respondents (i.e., Haimeng and Winhere) reported that they did
not incur costs for the ball bearing cups and lug bolts they
incorporated into certain brake rotor models which they exported to the
United States, because their U.S. customers provided these items free-
of-charge. Both companies supported their claims that their U.S.
customers
[[Page 26743]]
contracted with PRC ball bearing cup and lug bolts producers to deliver
these components to the respondents in specific quantities free-of-
charge, and that the components were then incorporated, in
corresponding quantities, in the integral models shipped to U.S.
customers during the POR.
To reflect the U.S. customers' expenditures for these items, we
adjusted the U.S. price of the transactions in question by assigning
Indian surrogate values to the ball bearing cups and lug bolts used in
those integral brake rotor transactions and added these amounts to U.S.
price. See Brake Rotors 7\th\ Review Final Results and the accompanying
Issues and Decisions Memorandum at Comment 5. See also Certain
Preserved Mushrooms From the People's Republic of China: Final Results
and Final Rescission, in Part, of Antidumping Duty Administrative
Review 70 FR 54361 (September 14, 2005), and the accompanying Issues
and Decisions Memorandum at Comment 13.
Normal Value
Section 773(c)(1) of the Act provides that the Department shall
determine NV using a factors-of-production methodology if the
merchandise is exported from an NME country and the information does
not permit the calculation of NV using home-market prices, third-
country prices, or constructed value under section 773(a) of the Act.
The Department will base NV on the factors of production because the
presence of government controls on various aspects of these economies
renders price comparisons and the calculation of production costs
invalid under its normal methodologies.
For purposes of calculating NV, we valued the PRC factors of
production in accordance with section 773(c)(1) of the Act. Factors of
production include, but are not limited to, hours of labor required,
quantities of raw materials employed, amounts of energy and other
utilities consumed, and representative capital costs, including
depreciation. See section 773(c)(3) of the Act. In examining surrogate
values, we selected, where possible, the publicly available value which
was an average non-export value, representative of a range of prices
within the POR or most contemporaneous with the POR, product-specific,
and tax-exclusive. See, e.g., Notice of Preliminary Determination of
Sales at Less Than Fair Value and Postponement of Final Determination:
Chlorinated Isocyanurates from the People's Republic of China, 69 FR
75294, 75300 (December 16, 2004) (``Chlorinated Isocyanurates''). We
used the usage rates reported by the respondents for materials, energy,
labor, by-products, and packing. For a detailed explanation of the
methodology used to calculate surrogate values, see Preliminary Results
Valuation Memorandum, dated May 1, 2005 (``Factor Valuation Memo'').
Regarding the components supplied free-of charge to two
respondents, section 773(c)(3) of the Act states that ``the factors of
production utilized in producing merchandise include, but are not
limited to the quantities of raw materials employed.'' Therefore,
consistent with the corresponding adjustment to U.S. price discussed
above, we valued the ball bearing cups and lug bolts usage amounts
reported by these respondents for specific integral brake rotor models
by using an Indian surrogate value for each input. See Factor Valuation
Memo.
Factor Valuations
In accordance with section 773(c) of the Act, we calculated NV
based on the factors of production reported by the respondents for the
POR. We relied on the factor specification data submitted by the
respondents for the above-mentioned inputs in their questionnaire and
supplemental questionnaire responses, where applicable, for purposes of
selecting surrogate values.
To calculate NV, we multiplied the reported per-unit factor
quantities by publicly available Indian surrogate values (except where
noted below). In selecting the surrogate values, we considered the
quality, specificity, and contemporaneity of the data. As appropriate,
we adjusted input prices by including freight costs to make them
delivered prices. Specifically, we added to Indian import surrogate
values a surrogate freight cost using the shorter of the reported
distance from the domestic supplier to the factory or the distance from
the nearest seaport to the factory, where appropriate. This adjustment
is in accordance with the Court of Appeals for the Federal Circuit's
decision in Sigma Corp. v. United States, 117 F. 3d 1401 (Fed. Cir.
1997). Due to the extensive number of surrogate values in this
administrative review, we present a discussion of the main factors. For
a detailed description of all surrogate values used for respondents,
see Factor Valuation Memo.
Except where discussed below, we valued raw material inputs using
April 2004-March 2005 weighted-average Indian import values derived
from the World Trade Atlas online (``WTA'') (see also Factor Valuation
Memo). The Indian import statistics we obtained from the WTA were
published by the DGCI&S, Ministry of Commerce of India, which were
reported in rupees. Indian surrogate values denominated in foreign
currencies were converted to U.S. dollars using the applicable average
exchange rate for India for the POR. The average exchange rate was
based on exchange rate data from the Department's Web site. See https://
ia.ita.doc.gov/exchange/. Where we could not obtain PAI
contemporaneous with the POR with which to value factors, we adjusted
the surrogate values for inflation using Indian wholesale price indices
(``WPIs'') as published in the International Monetary Fund's
International Financial Statistics. See Factor Valuation Memo.
Furthermore, with regard to the Indian import-based surrogate
values, we have disregarded prices from NME countries and those that we
have reason to believe or suspect may be subsidized (i.e., Indonesia,
South Korea, and Thailand). We have found in other proceedings that
these countries maintain broadly available, non-industry-specific
export subsidies. Therefore, it is reasonable to believe or suspect all
exports to all markets from these countries are subsidized. See, e.g.,
Final Determination of Sales at Less Than Fair Value: Certain Helical
Spring Lock Washers From The People's Republic, 58 FR 48833 (September
20, 1993), and accompanying Issues and Decision Memorandum at Comment
1.
Finally, we excluded imports that were labeled as originating from
an ``unspecified'' country from the average value, because the
Department could not be certain that they were not from either an NME
or a country with general export subsidies.
To value lubrication oil, we used January 2004-December 2004 WTA
average import values from the Philippines, because the post-March 2000
Indian import values from WTA for this input were unavailable or were
labeled as originating from an ``unspecified'' country. Moreover, the
import values from WTA for the other recommended surrogate countries
either did not provide data on a country-of-origin-specific basis or
were unavailable.
We valued electricity using the 2000 total average price per
kilowatt hour for ``Electricity for Industry'' as reported in the
International Energy Agency's publication, Energy Prices and Taxes,
Second Quarter, 2003. We adjusted this rate for inflation.
[[Page 26744]]
The Department revised its calculation of expected wages of
selected NME countries. See https://ia.ita.doc.gov/wages/. The
Department's revised calculation of expected NME wages, consistent with
its normal methodology and with Section 351.408(c)(3) of the
Department's regulations, is based on the most current data available
as of November 2005. The Department's expected NME wage rate for the
PRC is USD $0.97 per hour. We used this wage rate in valuing labor.
To value corrugated paper cartons, nails, plastic bags, plastic
sheets/covers, paper sheet, steel strip, particle board, plywood and
straps/buckles, tape and pallet wood, we used April 2004-March 2005
average import values from WTA. All respondents (with the exception of
Hengtai) included the weight of the clamps/buckles in their reported
steel strip weights since the material of both inputs was the same.
Therefore, we valued these factors using the combined weight reported
by the respondents.
To value PRC inland freight for inputs shipped by truck, we used
Indian freight rates from the following Web site: https://
www.infreight.com. To value PRC inland freight by barge we used an
Indian domestic shipping rate from the 2000-2001 antidumping duty
administrative review of helical spring lock washers from the PRC. See
Certain Helical Spring Lock Washers From the People's Republic of
China; Final Results of Antidumping Duty Administrative Review, 67 FR
8520 (Feb. 25, 2002), and accompanying decision memorandum at comment
5; Preliminary Determination of Sales at Less Than Fair Value and
Postponement of Final Determination: Polyvinyl Alcohol from the
People's Republic of China, 68 FR 13674 (March 20, 2003). We adjusted
this rate for inflation.
To value factory overhead and selling, general and administrative
(``SG&A'') expenses, and profit, we used data from the 2004-2005
financial reports of Kalyani Brakes Limited and Rico Auto Industries
Limited. These Indian companies are producers of the subject
merchandise based on data contained in each Indian company's financial
reports.
Where appropriate, the excise duty amounts listed in the financial
reports were removed from the surrogate overhead and SG&A calculations.
Moreover, petitioners made certain adjustments to the calculated ratios
as a result of reclassifying certain expenses contained in the
financial reports consistent with the Department's normal practice.
See, e.g., Brake Rotors 7\th\ Review Final Results. For a further
discussion of the adjustments made, see Factor Valuation Memo.
Two respondents (i.e., Winhere and Meita) neglected to report
transportation distances from their casting facilities to their
finishing workshops. See Winhere Verification Report; see also Meita
Verification Report. Therefore, for purposes of these preliminary
results, we are using the surrogate value for truck freight to value
this foreign inland transportation expense for these two companies
using distances information obtained at verification. See Memorandum to
the File, through Christopher D. Riker, Program Manager, Ad/CVD
Operations, Office 9, Import Administration, from Thomas Killiam,
Analyst, AD/CVD Operations, Office 9, Import Administration, regarding
2004/2005 Antidumping Duty Administrative Review of the Antidumping
Duty Order on Brake Rotors from the People's Republic of China:
Calculation Memorandum for the Preliminary Results for Yantai Winhere
Auto-Part Manufacturing Co., Ltd. (``Winhere'') (May 1, 2006); see also
Memorandum to the File, through Christopher D. Riker, Program Manager,
Ad/CVD Operations, Office 9, Import Administration, from Thomas
Killiam, Analyst, AD/CVD Operations, Office 9, Import Administration,
regarding 2004/2005 Antidumping Duty Administrative Review of the
Antidumping Duty Order on Brake Rotors from the People's Republic of
China: Calculation Memorandum for the Preliminary Results for Qingdao
Meita Automotive Industry Co., Ltd. (``Meita) (May 1, 2006) (``Meita
Calculation Memo'').
Additionally, Meita was unable to substantiate the reported carbon
content of the ferromanganese it consumes in the production of the
subject merchandise. See Meita Verification Report. Therefore, pursuant
to section 776(a)(2)(D) of the Act, for purposes of these preliminary
results, we are valuing this input based on the facts available.
Moreover, because we determine that Meita failed to cooperate by not
acting to the best of its ability to report the carbon content,
pursuant to Section 776(b) of the Act, we have applied the higher of
the two potential surrogate values to value the ferromanganese
consumption for this company as adverse facts available. See Meita
Calculation Memo.
Finally, we note that although Hongfa reported bentonite and coal
powder as inputs in the sand mixing stage of production which it
believes should be valued in overhead, company officials explained at
verification that these items are in fact a
