Folding Metal Tables and Chairs from the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review, 38852-38860 [E6-10740]

Download as PDF 38852 Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Notices Dated: June 30, 2006. Stephen J. Claeys, Deputy Assistant Secretaryfor Import Administration. [FR Doc. E6–10736 Filed 7–7–06; 8:45 am] Billing Code: 3510–DS–S DEPARTMENT OF COMMERCE International Trade Administration [A–570–868] Folding Metal Tables and Chairs from the People’s Republic of China: Preliminary Results of Antidumping Duty Administrative Review Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce (‘‘the Department’’) is conducting an administrative review of the antidumping duty order on folding metal tables and chairs (‘‘FMTCs’’) from the People’s Republic of China (‘‘PRC’’) covering the period June 1, 2004, through May 31, 2005. We have preliminarily determined that sales have not been made below normal value (‘‘NV’’) by Feili Furniture Development Limited Quanzhou City, Feili Furniture Development Co., Ltd., Feili Group (Fujian) Co., Ltd., Feili (Fujian) Co., Ltd. (collectively ‘‘Feili’’), and New–Tec Integration (Xiamen) Co. Ltd. (‘‘New– Tec’’). Further, we have preliminarily determined to apply an adverse facts available (‘‘AFA’’) rate to all sales and entries of the subject merchandise during the period of review (‘‘POR’’) for Anji Jiu Zhou Machinery Co., Ltd. (‘‘Anji Jiu’’), Xiamen Zehui Industry Trade Co. (‘‘Xiamen Zehui’’), and Yixiang Blow Mold Yuyao Co., Ltd. (‘‘Yixiang’’). If these preliminary results are adopted in our final results of this review, we will instruct U.S. Customs and Border Protection (‘‘CBP’’) to assess antidumping duties on all appropriate entries of subject merchandise during the POR. Interested parties are invited to comment on these preliminary results. We intend to issue the final results no later than 120 days from the date of publication of this notice, pursuant to section 751(a)(3)(A) of the Tariff Act of 1930, as amended (‘‘the Act’’). EFFECTIVE DATE: July 10, 2006. FOR FURTHER INFORMATION CONTACT: Laurel LaCivita or Matthew Quigley, AD/CVD Operations, Office 8, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; sroberts on PROD1PC70 with NOTICES AGENCY: VerDate Aug<31>2005 17:10 Jul 07, 2006 Jkt 208001 telephone: (202) 482–4243 or (202) 482– 4551, respectively. SUPPLEMENTARY INFORMATION: On June 27, 2002, the Department published the antidumping duty order on FMTCs from the PRC. See Antidumping Duty Order: Folding Metal Tables and Chairs From the People’s Republic of China, 67 FR 43277 (June 27, 2002). On June 1, 2005, the Department published a notice of opportunity to request an administrative review of this order. See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 70 FR 31422 (June 1, 2005). In accordance with 19 CFR 351. 213(b)(1), the following requests were made: (1) on June 27, 2005, Cosco Home and Office Products (‘‘Cosco’’), a U.S. importer of subject merchandise, requested that the Department conduct an administrative review of Feili and New–Tec; (2) on June 28, 2005, Meco Corporation (‘‘Meco’’), a domestic interested party, requested that the Department review Feili’s and New–Tec’s sales and entries during the POR; (3) on June 30, 2005, FDL, Inc. (‘‘FDL’’), a U.S. importer of the subject merchandise, requested that the Department review all sales and entries of Anji Jiu, Xiamen Zehui, and Yixiang. On July 21, 2005, the Department initiated this administrative review with respect to Feili, New–Tec, Anji Jiu, Xiamen Zehui, and Yixiang. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 70 FR 42028 (July 21, 2005). The Department issued antidumping duty questionnaires to all of the above– named respondents on August 16, 2005. On September 13, 2005, Feili and New–Tec submitted their Section A questionnaire responses (‘‘AQRs’’). New–Tec submitted its Sections C and D questionnaire response (‘‘CQR’’ and ‘‘DQR’’) on October 11, 2005, and Feili submitted its CQR, DQR, and its sales and cost reconciliation on October 13, 2005. On November 8, 2005, the Department issued its first supplemental Section A questionnaire to New–Tec, and on November 29, 2005, the Department issued its first supplemental Sections A, C, D, and cost reconciliation questionnaire to Feili. New–Tec submitted its supplemental Section A questionnaire response on November 29, 2005, and Feili submitted its first supplemental questionnaire response (‘‘SQR’’) on December 21, 2005. New– Tec submitted its sales and cost reconciliation on January 20, 2006. On February 7, 2006, the Department issued its second supplemental questionnaire PO 00000 Frm 00011 Fmt 4703 Sfmt 4703 to Feili. Feili responded on February 23, 2006. The Department issued its second supplemental questionnaire to New–Tec on March 15, 2006, and its third supplemental questionnaire to Feili on March 22, 2006. On April 12, 2006, Feili submitted its third supplemental questionnaire response (‘‘3rd SQR’’) and New–Tec submitted its second supplemental questionnaire response. On May 2, 2006, the Department issued its third supplemental questionnaire to New–Tec. New–Tec provided its 3rd SQR on May 18, 2006. The Department issued its fourth supplemental questionnaire to Feili on May 16, 2006. On May 30, 2006, Feili submitted its fourth supplemental questionnaire response. The Department issued its fifth supplemental questionnaire to Feili on June 7, 2006, and Feili responded on June 19, 2006. Anji Jiu, Xiamen Zehui, and Yixiang did not respond to the Department’s questionnaire. See ‘‘Adverse Facts Available’’ section, below. The Department requested interested parties to submit surrogate value information on March 21, 2006, and to provide surrogate country selection comments on April 7, 2006. See Memorandum to File from Cathy Feig, International Trade Compliance Analyst, through Charles Riggle, Program Manager, AD/CVD Operations, Office 8, ‘‘Surrogate Value Submission Deadline: Folding Metal Tables and Chairs from the Peoples Republic of China’’ (March 21, 2006); and Letter from Charles Riggle, Program Manager, AD/CVD Operations, Office 8, to Feili, New–Tec, Cosco, Meco, and Resilient Furniture, ‘‘Re: Administrative Review of Folding Metal Tables and Chairs from the People’s Republic of China,’’ (April 7, 2006). On April 21, 2006, Feili and Meco provided comments on publicly available information to value the factors of production (‘‘FOP’’). None of the interested parties provided comments on the selection of a surrogate country. On February 28, 2006, the Department published a notice in the Federal Register extending the time limit for the preliminary results of review until June 30, 2006. See Folding Metal Tables and Chairs From the People’s Republic of China: Notice of Extension of Time Limit for the Preliminary Results of the Antidumping Duty Administrative Review, 71 FR 10008, (February 28, 2006). Period of Review The POR is June 1, 2004, through May 31, 2005. E:\FR\FM\10JYN1.SGM 10JYN1 Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Notices sroberts on PROD1PC70 with NOTICES Scope of the Order The products covered by this order consist of assembled and unassembled folding tables and folding chairs made primarily or exclusively from steel or other metal, as described below: (1) Assembled and unassembled folding tables made primarily or exclusively from steel or other metal (folding metal tables). Folding metal tables include square, round, rectangular, and any other shapes with legs affixed with rivets, welds, or any other type of fastener, and which are made most commonly, but not exclusively, with a hardboard top covered with vinyl or fabric. Folding metal tables have legs that mechanically fold independently of one another, and not as a set. The subject merchandise is commonly, but not exclusively, packed singly, in multiple packs of the same item, or in five piece sets consisting of four chairs and one table. Specifically excluded from the scope of the order regarding folding metal tables are the following: a. Lawn furniture; b. Trays commonly referred to as ‘‘TV trays’’; c. Side tables; d. Child–sized tables; e. Portable counter sets consisting of rectangular tables 36’’ high and matching stools; and, f. Banquet tables. A banquet table is a rectangular table with a plastic or laminated wood table top approximately 28’’ to 36’’ wide by 48’’ to 96’’ long and with a set of folding legs at each end of the table. One set of legs is composed of two individual legs that are affixed together by one or more cross–braces using welds or fastening hardware. In contrast, folding metal tables have legs that mechanically fold independently of one another, and not as a set. (2) Assembled and unassembled folding chairs made primarily or exclusively from steel or other metal (folding metal chairs). Folding metal chairs include chairs with one or more cross–braces, regardless of shape or size, affixed to the front and/or rear legs with rivets, welds or any other type of fastener. Folding metal chairs include: those that are made solely of steel or other metal; those that have a back pad, a seat pad, or both a back pad and a seat pad; and those that have seats or backs made of plastic or other materials. The subject merchandise is commonly, but not exclusively, packed singly, in multiple packs of the same item, or in five piece sets consisting of four chairs and one table. Specifically excluded from the scope of the order regarding folding metal chairs are the following: VerDate Aug<31>2005 17:10 Jul 07, 2006 Jkt 208001 a. Folding metal chairs with a wooden back or seat, or both; b. Lawn furniture; c. Stools; d. Chairs with arms; and e. Child–sized chairs. The subject merchandise is currently classifiable under subheadings 9401.71.0010, 9401.71.0030, 9401.79.0045, 9401.79.0050, 9403.20.0010, 9403.20.0030, 9403.70.8010, 9403.70.8020, and 9403.70.8030 of the Harmonized Tariff Schedule of the United States (‘‘HTSUS’’). Although the HTSUS subheadings are provided for convenience and customs purposes, the Department’s written description of the merchandise is dispositive. Non–Market Economy Country Status Neither Feili nor New–Tec contested the Department’s treatment of the PRC as a non–market economy (‘‘NME’’), and the Department has treated the PRC as an NME country in all past antidumping duty investigations and administrative reviews and continues to do so in this case. See, e.g., Honey from the People’s Republic of China: Final Results and Final Rescission, In Part, of Antidumping Duty Administrative Review, 71 FR 34893 (June 16, 2006) (‘‘Honey’’); and Final Determination of Sales at Less Than Fair Value and Final Partial Affirmative Determination of Critical Circumstances: Diamond Sawblades and Parts Thereof from the People’s Republic of China, 71 FR 29303 (May 22, 2006) (‘‘Sawblades’’). No interested party in this case has argued that we should do otherwise. Designation as an NME country remains in effect until it is revoked by the Department. See Section 771(18)(C)(i) of the Act. Surrogate Country Section 773(c)(1) of the Act directs the Department to base NV on the NME producer’s FOPs, valued in a surrogate market–economy country or countries considered to be appropriate by the Department. In accordance with section 773(c)(4) of the Act, in valuing the FOPs, the Department shall use, to the extent possible, the prices or costs of the FOPs in one or more market–economy countries that are: (1) at a level of economic development comparable to that of the NME country; and (2) significant producers of comparable merchandise. The sources of the surrogate factor values are discussed under the ‘‘Normal Value’’ section below and in the Memorandum from Laurel LaCivita and Matthew Quigley, International Trade Compliance Analysts, through Charles Riggle, PO 00000 Frm 00012 Fmt 4703 Sfmt 4703 38853 Program Manager, to Wendy Frankel, Director, AD/CVD Operations, Office 8, ‘‘Preliminary Results of the 2004–2005 Administrative Review of Folding Metal Tables and Chairs from the People’s Republic of China: Surrogate Value Memorandum’’ (June 30, 2006) (‘‘Surrogate Value Memorandum’’). The Department has previously determined that India, Indonesia, Sri Lanka, the Philippines, and Egypt are countries comparable to the PRC in terms of economic development. See Memorandum from Ron Lorentzen to Wendy Frankel, Director, AD/CVD Enforcement, Office 8, ‘‘Administrative Review of Folding Metal Tables and Chairs (‘Tables and Chairs’) from the People’s Republic of China (‘PRC’): Request for a List of Surrogate Countries’’ (December 20, 2005) (‘‘Policy Memorandum’’). Customarily, we select an appropriate surrogate country from the Policy Memorandum based on the availability and reliability of data from the countries that are significant producers of comparable merchandise. In this case, we have found that India is a significant producer of comparable merchandise. See Memorandum from Laurel LaCivita and Matthew Quigley, International Trade Compliance Analysts, through Charles Riggle Program Manager, to Wendy Frankel, Director, AD/CVD Operations, Office 8, ‘‘Antidumping Administrative Review of Folding Metal Tables and Chairs: Selection of a Surrogate Country,’’ (June 30, 2006) (‘‘Surrogate Country Memorandum’’). The Department used India as the primary surrogate country and, accordingly, has calculated NV using Indian prices to value the PRC producers’ FOPs, when available and appropriate. See Surrogate Country Memorandum and Surrogate Value Memorandum. We have obtained and relied upon publicly available information wherever possible. In accordance with 19 CFR 351.301(c)(3)(ii), for the final results in an antidumping administrative review, interested parties may submit publicly available information to value factors of production within 20 days after the date of publication of the preliminary results of review. 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 assigned a single antidumping duty deposit rate. It is the Department’s policy to assign all exporters of subject merchandise subject E:\FR\FM\10JYN1.SGM 10JYN1 sroberts on PROD1PC70 with NOTICES 38854 Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Notices to review in an NME country a single rate unless an exporter can demonstrate that it is sufficiently independent of government control to be entitled to a separate rate. See, e.g., Honey from the People’s Republic of China: Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review, 70 FR 74764, 74765 (December 16, 2005) (unchanged in the final results); and Sawblades, 71 FR at 29307. We have considered whether each reviewed company based in the PRC is eligible for a separate rate. The Department’s separate–rate test to determine whether the exporters are independent from government control does not consider, in general, macroeconomic/border–type controls, e.g., export licenses, quotas, and minimum export prices, particularly if these controls are imposed to prevent dumping. The test focuses, rather, on controls over the investment, pricing, and output decision–making process at the individual firm level. See, e.g., Tapered Roller Bearings and Parts Thereof, Finished and Unfinished, From the People’s Republic of China: Final Results of Antidumping Administrative Review, 62 FR 61276, 61279 (November 17, 1997); and Preliminary Determination of Sales at Less than Fair Value: Honey from the People’s Republic of China, 60 FR 14725,14727– 28 (March 20, 1995). To establish whether an exporter is sufficiently independent of government control to be entitled to a separate rate, the Department analyzes the exporter in light of select criteria, discussed below. See Final Determination of Sales at Less Than Fair Value: Sparklers from the People’s Republic of China, 56 FR 20585, 22587 (May 6, 1991) (‘‘Sparklers’’); and 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’’). Under this test, exporters in NME countries are entitled to separate, company–specific margins when they can demonstrate an absence of government control over exports, both in law (‘‘de jure’’) and in fact (‘‘de facto’’). Feili and New–Tec each provided company–specific separate–rate information and stated that each met the standards for the assignment of separate rates. Anji Jiu, Xiamen Zehui, and Yixiang did not submit any information to establish their entitlement to a separate rate. Feili reported that it is wholly owned by market–economy entities. See Feili’s AQR, at 2 and Exhibit A–3. Therefore, a separate rates analysis is not necessary to determine whether Feili’s export activities are VerDate Aug<31>2005 17:10 Jul 07, 2006 Jkt 208001 independent from government control. See e.g., Brake Rotors From the People’s Republic of China: Preliminary Results of the Tenth New Shipper Review, 69 FR 30875, 30876 (June 1, 2004) (unchanged in final results); 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); Preliminary Results of First New Shipper Review and First Antidumping Duty Administrative Review: Certain Preserved Mushrooms From the People’s Republic of China, 65 FR 66703, 66705 (November 7, 2000) (unchanged in the final results of review); and Notice of Final Determination of Sales at Less Than Fair Value: Bicycles From the People’s Republic of China, 61 FR 19026, 19027 (April 30, 1996) (‘‘Bicycles’’). For New Tec, a separate rates analysis is necessary to determine whether its export activities are independent from government control. A. Absence of De Jure Control The Department considers the following de jure criteria in determining whether an individual company may be granted a separate rate: (1) an absence of restrictive stipulations associated with an individual exporter’s business and export licenses; (2) any legislative enactments decentralizing control of companies; or (3) any other formal measures by the government decentralizing control of companies. See Sparklers, 56 FR 20588. New–Tec is a joint venture owned by New–Tec International Inc., a South Korean company, and Xiamen Integration Co., Ltd., a PRC company. New–Tec has placed documents on the record to demonstrate the absence of de jure control including its list of shareholders, business license, and the Company Law of the People’s Republic of China, as revised October 27, 2005 (‘‘Company Law’’). Other than limiting New–Tec to activities referenced in the business license, we found no restrictive stipulations associated with the license. In addition, in previous cases the Department has analyzed the Company Law and found that it establishes an absence of de jure control. See, e.g., Certain Non–Frozen Apple Juice Concentrate from the People’s Republic of China: Final Results, Partial Recision and Termination of a Partial Deferral of the 2002–2003 Administrative Review, 69 FR 65148, 65150 (November 10, 2004). We have no information in this segment of the proceeding that would cause us to reconsider this determination. Therefore, based on the foregoing, we have preliminarily found an absence of de jure control for New– Tec. PO 00000 Frm 00013 Fmt 4703 Sfmt 4703 B. Absence of De Facto Control As stated in previous cases, there is some evidence that certain enactments of the PRC central government have not been implemented uniformly among different sectors and/or jurisdictions in the PRC. See, e.g., Notice of Final Determination of Sales at Less Than Fair Value: Certain Preserved Mushrooms from the People’s Republic of China, 63 FR 72255, 72257 (December 31, 1998). Therefore, the Department has preliminarily determined that an analysis of de facto control is critical in determining whether respondents are, in fact, subject to a degree of government control that would preclude the Department from assigning separate rates. The Department typically considers four factors in evaluating whether each respondent is subject to de facto government control of its export functions: (1) whether the exporter sets its own export prices independent of the government and without the approval of a government 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 its management; and (4) whether the respondent retains the proceeds of its export sales and makes independent decisions regarding disposition of profits or financing of losses. See, e.g., Final Determination of Sales at Less Than Fair Value: Furfuryl Alcohol From the People’s Republic of China, 60 FR 22544, 22545 (May 8, 1995). With regard to de facto control, New– Tec reported that: (1) it independently set prices to the United States through negotiations with customers and these prices are not subject to review by any government organization; (2) it did not coordinate with other exporters or producers to set the price or to determine to which market the companies will sell subject merchandise; (3) the PRC Chamber of Commerce does not coordinate the export activities of New–Tec; (4) its general manager has the authority to contractually bind it to sell subject merchandise; (5) its board of directors appoint its general manager; (6) there is no restriction on its use of export revenues; (7) its shareholders ultimately determine the disposition of respective profits, and New–Tec has not had a loss in the last two years; and (8) none of New–Tec’s board members or managers is a government official. Additionally, New–Tec’s questionnaire responses did not suggest that pricing is coordinated among exporters. Furthermore, our E:\FR\FM\10JYN1.SGM 10JYN1 Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Notices sroberts on PROD1PC70 with NOTICES analysis New–Tec’s questionnaire responses reveals no other information indicating government control of its export activities. Therefore, based on the information on the record, we preliminarily determine that there is an absence of de facto government control with respect tor New–Tec’s export functions and that New–Tec has met the criteria for the application of a separate rate. Adverse Facts Available Sections 776(a)(1) and (2) of the Act provide that the Department shall apply ‘‘facts otherwise available’’ if, inter alia, necessary information is not on the record or an interested party or any other person: (A) withholds information that has been requested; (B) fails to provide information within the deadlines established, or in the form and manner requested by the Department, subject to subsections (c)(1) and (e) of section 782 of the Act; (C) significantly impedes a proceeding; or (D) provides information that cannot be verified as provided by section 782(i) of the Act. Where the Department determines that a response to a request for information does not comply with the request, section 782(d) of the Act provides that the Department will so inform the party submitting the response and will, to the extent practicable, provide that party the opportunity to remedy or explain the deficiency. If the party fails to remedy the deficiency within the applicable time limits and subject to section 782(e) of the Act, the Department may disregard all or part of the original and subsequent responses, as appropriate. Section 782(e) of the Act provides that the Department ‘‘shall not decline to consider information that is submitted by an interested party and is necessary to the determination but does not meet all applicable requirements established by the administering authority’’ if the information is timely, can be verified, is not so incomplete that it cannot be used, and if the interested party acted to the best of its ability in providing the information. Where all of these conditions are met, the statute requires the Department to use the information if it can do so without undue difficulties. Section 776(b) of the Act further provides that the Department may use an adverse inference in applying the facts otherwise available when a party has failed to cooperate by not acting to the best of its ability to comply with a request for information. Section 776(b) of the Act also authorizes the Department to use as AFA information derived from the petition, the final VerDate Aug<31>2005 17:10 Jul 07, 2006 Jkt 208001 determination, a previous administrative review, or other information placed on the record. Section 776(c) of the Act provides that, when the Department relies on secondary information rather than on information obtained in the course of an investigation or review, it shall, to the extent practicable, corroborate that information from independent sources that are reasonably at its disposal. Secondary information is defined as ‘‘[i]nformation derived from the petition that gave rise to the investigation or review, the final determination concerning the subject merchandise, or any previous review under section 751 concerning the subject merchandise.’’ See Statement of Administrative Action (‘‘SAA’’) accompanying the Uruguay Round Agreements Act, H. Doc. No. 316, 103d Cong., 2d Session at 870 (1994). Corroborate means that the Department will satisfy itself that the secondary information to be used has probative value. See SAA at 870. To corroborate secondary information, the Department will, to the extent practicable, examine the reliability and relevance of the information to be used. The SAA emphasizes, however, that the Department need not prove that the selected facts available are the best alternative information. See SAA at 869. For the reasons discussed below, we determine that, in accordance with sections 776(a)(2) and 776(b) of the Act, the use of AFA is appropriate for the preliminary results for the PRC–wide entity, including Anji Jiu, Xiamen Zehui, and Yixiang. Anji Jiu, Xiamen Zehui, and Yixiang Anji Jiu, Xiamen Zehui, and Yixiang did not respond to our August 16, 2005, questionnaire. In the Initiation Notice, the Department stated that if one of the companies on which we initiated a review does not qualify for a separate rate, all other exporters of FMTCs from the PRC who have not qualified for a separate rate are deemed to be covered by this review as part of the single PRC– wide entity of which the named exporter is a part. See Initiation Notice at n.1. Because Anji Jiu, Xiamen Zehui, and Yixiang did not submit any information to establish their eligibility for a separate rate, we find they are deemed to be part of the PRC–wide entity. See Separate Rates section above. The PRC–Wide Rate and Use of AFA In addition, because we have determined that Anji Jiu, Xiamen Zehui, and Yixiang are not entitled to separate rates and are now part of the PRC–wide entity, the PRC–wide entity is now under review. We further find that PO 00000 Frm 00014 Fmt 4703 Sfmt 4703 38855 because the PRC–wide entity (including Anji Jiu, Xiamen Zehui, and Yixiang) failed to provide the requested information in the administrative review, the Department, pursuant to section 776(a) of the Act, has applied a dumping margin for the PRC–wide entity using the facts otherwise available on the record. Furthermore, because we have determined that the PRC–wide entity (including Anji Jiu, Xiamen Zehui, and Yixiang) has failed to cooperate to the best of its ability, the Department has used an adverse inference in making its determination, pursuant to section 776(b) of the Act. Selection of the Adverse Facts Available Rate In deciding which facts to use as AFA, section 776(b) of the Act and 19 CFR 351.308(c)(1) authorize the Department to rely on information derived from (1) the petition, (2) a final determination in the investigation, (3) any previous review or determination, or (4) any information placed on the record. It is the Department’s practice to select, as AFA, the highest calculated rate in any segment of the proceeding. See, e.g., Certain Cased Pencils from the People’s Republic of China; Notice of Preliminary Results of Antidumping Duty Administrative Review and Intent to Rescind in Part, 70 FR 76755, 76761 (December 28, 2005). The Court of International Trade (‘‘CIT’’) and the Court of Appeals for the Federal Circuit (‘‘Fed. Cir.’’) have consistently upheld the Department’s practice. See Rhone Poulenc, Inc. v. United States, 899 F. 2d 1185, 1190 (Fed. Cir. 1990) (upholding the Department’s presumption that the highest margin was the best information of current margins) (‘‘Rhone Poulenc’’); NSK Ltd. v. United States, 346 F. Supp. 2d 1312, 1335 (CIT 2004) (upholding a 73.55 percent total AFA rate, the highest available dumping margin from a different respondent in a less–than-fair– value (‘‘LTFV’’) investigation); Kompass Food Trading International v. United States, 24 CIT 678, 683 (2000) (upholding a 51.16 percent total AFA rate, the highest available dumping margin from a different, fully cooperative respondent); and Shanghai Taoen International Trading Co., Ltd. v. United States, 360 F. Supp. 2d 1339, 1348 (CIT 2005) (upholding a 223.01 percent total AFA rate, the highest available dumping margin from a different respondent in a previous administrative review). The Department’s practice when selecting an adverse rate from among the possible sources of information is to ensure that the margin is sufficiently E:\FR\FM\10JYN1.SGM 10JYN1 38856 Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Notices sroberts on PROD1PC70 with NOTICES adverse ‘‘as to effectuate the purpose of the facts available role to induce respondents to provide the Department with complete and accurate information in a timely manner.’’ See Notice of Final Determination of Sales at Less than Fair Value: Static Random Access Memory Semiconductors From Taiwan; 63 FR 8909, 8932 (February 23, 1998). The Department’s practice also ensures ‘‘that the party does not obtain a more favorable result by failing to cooperate than if it had cooperated fully.’’ See SAA at 870. See also, 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 69937, 69939 (November 18, 2005). In choosing the appropriate balance between providing respondents with an incentive to respond accurately and imposing a rate that is reasonably related to the respondents’ prior commercial activity, selecting the highest prior margin ‘‘reflects a common sense inference that the highest prior margin is the most probative evidence of current margins, because, if it were not so, the importer, knowing of the rule, would have produced current information showing the margin to be less.’’ See Rhone Poulenc, 899 F. 2d at 1190. Due to Anji Jiu’s, Xiamen Zehui’s, and Yixiang’s failure to cooperate in this administrative review, we have preliminarily assigned the PRC–wide entity, of which they are deemed to be a part, an AFA rate of 70.71 percent, which is the PRC–wide rate determined in the investigation and the rate currently applicable to the PRC–wide entity. See Notice of Amended Final Determination of Sales at Less Than Fair Value: Folding Metal Tables and Chairs From the People’s Republic of China, 67 FR 34898, (May 16, 2002) (‘‘FMTC Amended Final Determination’’). The Department preliminarily determines that this information is the most appropriate from the available sources to effectuate the purposes of AFA. The Department’s reliance on the PRC–wide rate from the original investigation to determine an AFA rate is subject to the requirement to corroborate secondary information. See Section 776(c) of the Act and the ‘‘Corroboration of Secondary Information’’ section below. Corroboration of Secondary Information Section 776(c) of the Act provides that, where the Department selects from among the facts otherwise available and relies on ‘‘secondary information,’’ the VerDate Aug<31>2005 17:10 Jul 07, 2006 Jkt 208001 Department shall, to the extent practicable, corroborate that information from independent sources reasonably at the Department’s disposal. Secondary information is described in the SAA as ‘‘information derived from the petition that gave rise to the investigation or review, the final determination concerning the subject merchandise, or any previous review under section 751 concerning the subject merchandise.’’ See SAA at 870. The SAA states that ‘‘corroborate’’ means to determine that the information used has probative value. The Department has determined that to have probative value information must be reliable and relevant. See Tapered Roller Bearings and Parts Thereof, Finished and Unfinished, From Japan, and Tapered Roller Bearings, Four Inches or Less in Outside Diameter, and Components Thereof, From Japan; Preliminary Results of Antidumping Duty Administrative Reviews and Partial Termination of Administrative Reviews, 61 FR 57391, 57392 (November 6, 1996). The SAA also states that independent sources used to corroborate such evidence may include, for example, published price lists, official import statistics and customs data, and information obtained from interested parties during the particular investigation. See SAA at 870. See also, Notice of Preliminary Determination of Sales at Less Than Fair Value: High and Ultra–High Voltage Ceramic Station Post Insulators from Japan, 68 FR 35627, 35629 (June 16, 2003); and Notice of Final Determination of Sales at Less Than Fair Value: Live Swine From Canada, 70 FR 12181, 12183 (March 11, 2005) (‘‘Live Swine from Canada’’). 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, the Department disregarded the highest margin as adverse best information available (the predecessor to facts available) because it was based on another company’s uncharacteristic business expense that resulted in an unusually high margin. See Fresh Cut Flowers From Mexico; Final Results of Antidumping Duty Administrative Review, 61 FR 6812, 6814 (February 22, 1996) (‘‘Fresh Cut Flowers from Mexico’’). Similarly, the Department does not apply a margin that has been discredited. See D&L Supply Co. v. United States, 113 F. 3d PO 00000 Frm 00015 Fmt 4703 Sfmt 4703 1220, 1223–4 (Fed. Cir. 1997) (finding that the Department will not use a margin that has been judicially invalidated). With regard to the relevance of the rate used, the Department notes that the rate used is the rate currently applicable to the PRC–wide entity and there is no information that indicates this rate is no longer relevant to the PRC–wide entity. In addition, we compared the margin calculations of Feili and New–Tec in this administrative review with the PRC–wide entity margin from the LTFV investigation and used in the first and second administrative reviews of this case. The Department found that the margin of 70.71 percent was within the range of the highest margins calculated for the respondents on the record of this administrative review. See Memorandum to the File from Laurel LaCivita and Matthew Quigley, International Trade Compliance Analysts, through Charles Riggle, Program Manager, AD/CVD Operations, Office 8, ‘‘Folding Metal Tables and Chairs from the PRC: Corroboration of the PRC–wide Adverse Facts–Available Rate,’’ (June 30, 2006) (‘‘Corroboration Memorandum’’). Because the record of this administrative review contains margins within the range of 70.71 percent, this further supports that this rate continues to be relevant for use in this administrative review. As we have determined, to the extent practicable, that the margin selected is both reliable and relevant, we determine that it has probative value. As a result, the Department determines that the margin is corroborated within the meaning of section 776(c) of the Act for the purposes of this administrative review and may reasonably be applied to the PRC–wide entity as AFA. Accordingly, we determine that the highest rate from any segment of this administrative proceeding, 70.71 percent, meets the corroboration criterion established in section 776(c) of the Act that secondary information have probative value. Because these are the preliminary results of review, the Department will consider all margins on the record at the time of the final results of review for the purpose of determining the most appropriate final margin for the PRC– wide entity. See Notice of Preliminary Determination of Sales at Less Than Fair Value: Solid Fertilizer Grade Ammonium Nitrate From the Russian Federation, 65 FR 1139, 1141 (January 7, 2000). Date of Sale Section 351.401(i) of the Department’s regulations states that: E:\FR\FM\10JYN1.SGM 10JYN1 Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Notices in identifying the date of sale of the subject merchandise or foreign like product, the Secretary normally will use the date of invoice, as recorded in the exporter or producer’s records kept in the normal course of business. However, the Secretary may use a date other than the date of invoice if the Secretary is satisfied that a different date better reflects the date on which the exporter or producer establishes the material terms of sale. See also, Allied Tube and Conduit Corp. v. United States, 132 F. Supp. 2d 1087, 1090–1093 (CIT 2001) (upholding the Department’s rebuttable presumption that invoice date is the appropriate date of sale). After examining the questionnaire responses and the sales documentation placed on the record by Feili and New–Tec, we preliminarily determine that invoice date is the most appropriate date of sale for each respondent. We made this determination based on statements on the record that indicate that Feili’s and New–Tec’s invoices establish the material terms of sale to the extent required by our regulations. See Feili CQR at C–11 and New–Tec CQR at C– 12. Nothing on the record rebuts the presumption that invoice date should be the date of sale. See Notice of Preliminary Determination of Sales at Less Than Fair Value: Saccharin From the People’s Republic of China, 67 FR 79049, 79054 (December 27, 2002). sroberts on PROD1PC70 with NOTICES Normal Value Comparisons To determine whether sales of FMTCs to the United States by Feili and New– Tec were made at less than NV, we compared export price (‘‘EP’’) to NV, as described in the ‘‘Export Price,’’ and ‘‘Normal Value’’ sections of this notice, pursuant to section 771(35) of the Act. Export Price Because Feili and New–Tec sold subject merchandise to unaffiliated purchasers in the United States prior to importation into the United States (or to unaffiliated resellers outside the United States with knowledge that the merchandise was destined for the United States) and use of a constructed– export-price methodology is not otherwise indicated, we have used EP in accordance with section 772(a) of the Act. We calculated EP based on the FOB or delivered price to unaffiliated purchasers for Feili and New–Tec. From this price, we deducted amounts for foreign inland freight, brokerage and handling, and where applicable, air freight, pursuant to section 772(c)(2)(A) VerDate Aug<31>2005 17:10 Jul 07, 2006 Jkt 208001 of the Act. See Memorandum to the File from Laurel LaCivita, Senior International Trade Compliance Analyst, through Charles Riggle, Program Manager, AD/CVD Operations, Office 8, ‘‘Analysis for the Preliminary Results of the 2004–2005 Administrative Review of Folding Metal Tables and Chairs from the People’s Republic of China: Feili Furniture Development Limited Quanzhou City, Feili Furniture Development Co., Ltd., Feili Group (Fujian) Co., Ltd., Feili (Fujian) Co., Ltd. (collectively, ’Feili’)’’ (June 30, 2006) (‘‘Feili Preliminary Analysis Memorandum’’); and Memorandum to the File from Matthew Quigley, International Trade Compliance Analyst, through Charles Riggle, Program Manager, AD/CVD Operations, Office 8, ‘‘Analysis for the Preliminary Results of the 2004–2005 Administrative Review of Folding Metal Tables and Chairs from the People’s Republic of China: New–Tec Integration (Xiamen) Co. Ltd. (‘‘New–Tec’’)’’ (June 30, 2006) (‘‘New–Tec Preliminary Analysis Memorandum’’). The Department used two sources to calculate a surrogate value for domestic brokerage expenses. The Department averaged December 2003–November 2004 data contained in Essar Steel’s February 28, 2005, public version response submitted in the antidumping duty administrative review of hot–rolled carbon steel flat products from India. See Certain Hot–Rolled Carbon Steel Flat Products From India: Notice of Preliminary Results of Antidumping Duty Administrative Review, 71 FR 2018 (January 12, 2006). This data was averaged with the February 2004– January 2005 data contained in Agro Dutch Industries Limited’s (‘‘Agro Dutch’’) May 24, 2005, public version response submitted in the administrative review of the antidumping duty order on certain preserved mushrooms from India. See Certain Preserved Mushrooms From India: Final Results of Antidumping Duty Administrative Review, 70 FR 37757 (June 30, 2005); and Notice of Preliminary Determination of Sales at Less Than Fair Value, Affirmative Critical Circumstances, In Part, and Postponement of Final Determination: Certain Lined Paper Products from the People’s Republic of China, 71 FR 19695, 19704 (April 17, 2006) (utilizing this same data). The brokerage expense data reported by Essar Steel and Agro Dutch in their public versions are ranged data. The Department first derived an average per–unit amount from each source. Then the Department adjusted each average rate for inflation. PO 00000 Frm 00016 Fmt 4703 Sfmt 4703 38857 Finally, the Department averaged the two per–unit amounts to derive an overall average rate for the POR. See Surrogate Value Memorandum at 8 and Attachment XVI. To value truck freight, we used the freight rates published by Indian Freight Exchange, available at http:// www.infreight.com. The truck freight rates are contemporaneous with the POR; therefore, we made no adjustments for inflation. Where applicable, we valued air freight using the rates published in the UPS website: http:// www.ups.com. We adjusted these rates for inflation using the U.S. Consumer Price Index published by the U.S. Department of Labor, Bureau of Labor Statistics, available on http:// data.bls.gov because the surrogate values for air freight were derived from U.S. sources. See Surrogate Value Memorandum at 7–8 and Attachment XVII. Zero–Priced Transactions During the course of this review, both Feili and New–Tec reported a significant number of zero–priced transactions to their U.S. customers. See Feili’s 1st SQR at 9 and Exhibit 13; and New–Tec’s 3rd SQR at Exhibit 9. An analysis of the Section C databases provided by each company reveals that both companies made a significant number of zero–priced transactions with customers that had purchased the same merchandise in commercial quantities. See Feili Preliminary Analysis Memorandum at Attachment I; and New–Tec Preliminary Analysis Memorandum at Attachment I. In the final results of the second administrative review of FMTCs, we included New–Tec’s zero–priced transactions in the margin calculation stating that the record demonstrated that: (1) New–Tec provided many pieces of the same product, indicating that these ‘‘samples’’ did not primarily serve for evaluation or testing of the merchandise; (2) New–Tec provided significant numbers of the same product to its U.S. customer while that customer was purchasing that same product; (3) New–Tec provided ‘‘samples’’ to the same customers to whom it was selling the same products in commercial quantities; (4) New–Tec acknowledged that it gave these products at zero price to its U.S. customers (already purchasing the same items) to sell to their own customers. See FMTC Second Review and accompanying Issues and Decision Memorandum at Comment 4. As a result, we concluded that New–Tec was not providing samples to entice its U.S. customers to buy the product. Ibid. E:\FR\FM\10JYN1.SGM 10JYN1 sroberts on PROD1PC70 with NOTICES 38858 Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Notices The Federal Circuit has not required the Department to exclude zero–priced or de minimis sales from its analysis, but rather, has defined a sale as requiring ‘‘both a transfer of ownership to an unrelated party and consideration.’’ See NSK Ltd. v. United States, 115 F.3d 965, 975 (Fed. Cir. 1997). The CIT in NSK Ltd. v. United States stated that it saw ‘‘little reason in supplying and re–supplying and yet re– supplying the same product to the same customer in order to solicit sales if the supplies are made in reasonably short periods of time,’’ and that ‘‘it would be even less logical to supply a sample to a client that has made a recent bulk purchase of the very item being sampled by the client.’’ NSK Ltd v. United States, 217 F. Supp. 2d 1291, 1311–1312 (CIT 2002). Furthermore, the Courts have consistently ruled that the burden rests with a respondent to demonstrate that it received no consideration in return for its provision of purported samples. See, e.g., Zenith Electronics Corp. v. United States, 988 F. 2d 1573, 1583 (Fed. Cir. 1993) (explaining that the burden of evidentiary production belongs ‘‘to the party in possession of the necessary information’’). See, also, Tianjin Machinery Import & Export Corp. v. United States, 806 F. Supp. 1008, 1015 (CIT 1992) (‘‘The burden of creating an adequate record lies with respondents and not with {the Department}.’’) (citation omitted). Moreover, ‘‘{e}ven where the Department does not ask a respondent for specific information that would enable it to make an exclusion determination in the respondent’s favor, the respondent has the burden of proof to present the information in the first place with its request for exclusion.’’ See Ball Bearings and Parts Thereof from France, Germany, Italy, Japan, Singapore, and the United Kingdom: Final Results of Antidumping Duty Administrative Reviews, 70 FR 54711 (September 16, 2005), and accompanying Issues and Decision Memorandum at Comment 8 (citing NTN Bearing Corp. of America. v. United States, 997 F. 2d 1453, 1458 (Fed. Cir. 1993)). An analysis of Feili’s and New–Tec’s Section C computer sales listings reveals that both companies provided zero– priced merchandise to the same customers to whom they were selling or had sold the same products in commercial quantities, with the exception of one of Feili’s customers, who did not make any purchases of subject merchandise during the POR. See Feili Preliminary Analysis Memorandum at Attachment I, Surrogate Value Memorandum, and VerDate Aug<31>2005 17:10 Jul 07, 2006 Jkt 208001 New–Tec Preliminary Analysis Memorandum at Attachment I. In addition, Feili stated that it sometimes provided samples to its customers so that those customers could provide samples to their customers in turn. See Feili 3rd SQR at 2. Consequently, based on the facts cited above, the guidance of past CIT decisions, and consistent with the decision in the previous review, from the preliminary results of this review, we have not excluded zero– priced transactions from the margin calculation of this case for either Feili or New–Tec, with the exception of certain sales Feili made to a new customer that did not purchase any subject merchandise during the POR. Normal Value Section 773(c)(1) of the Act provides that, in the case of an NME, the Department shall determine NV using an FOP methodology if the merchandise is exported from an NME 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 FOP because the presence of government controls on various aspects of these economies renders price comparisons and the calculation of production costs invalid under our normal methodologies. Therefore, we calculated NV based on FOP in accordance with sections 773(c)(3) and (4) of the Act and 19 CFR 351.408(c). The FOPs include: (1) hours of labor required; (2) quantities of raw materials employed; (3) amounts of energy and other utilities consumed; and (4) representative capital costs. We used the FOPs reported by respondents for materials, energy, labor, by–products, and packing. In accordance with 19 CFR 351.408(c)(1), the Department will normally use publicly available information to value the FOPs, but when a producer sources an input from a market–economy country and pays for it in market–economy currency, the Department will normally value the factor using the actual price paid for the input. See 19 CFR 351.408(c)(1); see also, Lasko Metal Products v. United States, 43 F.3d 1442, 1445–1446 (Fed. Cir. 1994) (affirming the Department’s use of market–based prices to value certain FOPs). Feili and New–Tec each reported that a significant portion of their purchases of cold–rolled steel, hot–rolled steel, steel wire rod, polypropylene plastic resin, polyurethane foam, powder coating, washers, screws, rivets, fibreboard, polyester fabric, corrugated paper and PO 00000 Frm 00017 Fmt 4703 Sfmt 4703 cartons were sourced from market– economy countries and paid for in market–economy currencies. See Feili’s DQR at D–7 and New–Tec’s DQR at D– 7. Pursuant to 19 CFR 351.408(c)(1), we used the actual price paid by respondents for inputs purchased from a market–economy supplier and paid for in a market–economy currency, except when prices may have been distorted by findings of dumping by the PRC and/or subsidies. With regard to both the Indian import–based surrogate values and the market–economy input values, we have disregarded prices that we have reason to believe or suspect may be subsidized. We have reason to believe or suspect that prices of inputs from India, Indonesia, South Korea, and Thailand may have been subsidized. We have found in other proceedings that these countries maintain broadly available, non–industry-specific export subsidies and, therefore, it is reasonable to infer that all exports to all markets from these countries may be subsidized. See Certain Frozen Fish Fillets from the Socialist Republic of Vietnam: Notice of Preliminary Results and Preliminary Partial Rescission of Antidumping Duty Administrative Review, 70 FR 54007, 54011 (September 13, 2005) (unchanged in the final results); Automotive Replacement Glass Windshields From the People’s Republic of China: Final Results of Administrative Review, 69 FR 61790 (October 21, 2004) and accompanying Issues and Decision Memorandum at Comment 5; and China National Machinery Import & Export Corporation v. United States, 293 F. Supp. 2d 1334 (CIT 2003), as affirmed by the Federal Circuit, 104 Fed. Appx. 183 (Fed. Cir. 2004). We are also guided by the statute’s legislative history that explains that it is not necessary to conduct a formal investigation to ensure that such prices are not subsidized. See H.R. Rep. 100–576 at 590 (1988). Rather, the Department was instructed by Congress to base its decision on information that is available to it at the time it is making its determination. Therefore, we have not used prices from these countries either in calculating the Indian import–based surrogate values or in calculating market–economy input values. In instances where a market– economy input was obtained solely from suppliers located in these countries, we used Indian import–based surrogate values to value the input. See Feili Preliminary Analysis Memorandum and New–Tec Preliminary Analysis Memorandum. Furthermore, we did not use any market–economy purchases of polyvinyl chloride from Taiwan, on which the E:\FR\FM\10JYN1.SGM 10JYN1 38859 Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Notices sroberts on PROD1PC70 with NOTICES PRC has an outstanding antidumping duty order. See World Trade Organization’s Committee on Anti– Dumping Practices Semi–Annual Report Under Article 16.4 of the Agreement, G/ ADP/N/CHN, for the period 1 July – 31 December 2005, available at www.wto.org. See Surrogate Value Memorandum at Attachment XIX. Factor Valuations In accordance with section 773(c) of the Act, we calculated NV based on the FOPs reported by respondents for the POR. To calculate NV, the reported per– unit factor quantities were multiplied by publicly available Indian surrogate values (except as 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 render 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 (i.e., where the sales terms for the market–economy inputs were not delivered to the factory). This adjustment is in accordance with the decision of the Federal Circuit in Sigma Corp. v. United States. Sigma Corp. v. United States, 117 F. 3d 1401, 1408 (Fed. Cir. 1997). For a detailed description of all surrogate values used for respondents, see the Surrogate Value Memorandum. Except as noted below, we valued raw material inputs using the weighted– average unit import values derived from the Monthly Statistics of the Foreign Trade of India, as published by the Directorate General of Commercial Intelligence and Statistics of the Ministry of Commerce and Industry, Government of India in the World Trade Atlas, available at http://www.gtis.com/ wta.htm (‘‘WTA’’). The WTA data are reported in rupees and are contemporaneous with the POR. See also, Surrogate Value Memorandum at Attachment V. Where necessary, we adjusted the surrogate values to reflect inflation/deflation using the Indian Wholesale Price Index (‘‘WPI’’) as published on the Reserve Bank of India (‘‘RBI’’) website, available at www.rbi.org.in. We further adjusted these prices to account for freight costs incurred between the suppler and respondent. We used the freight rates published by Indian Freight Exchange available at http://www.infreight.com, to value truck freight. We valued rail freight using the freight rates published by the Indian Railways and available at VerDate Aug<31>2005 17:10 Jul 07, 2006 Jkt 208001 http://www.indianrailways.gov.in/ railway/freightrates/ freightlchargesl2003.htm. The truck and rail freight rates are contemporaneous with the POR. Therefore, we made no adjustments for inflation. For a complete description of the factor values we used, see the Surrogate Value Memorandum. Feili and New–Tec reported they had market–economy purchases representing a meaningful portion of the total purchases of each respective input for cold–rolled steel, hot–rolled steel, steel wire rod, polypropylene plastic resin, polyurethane foam, powder coating, washers, screws, rivets, fibreboard, vinyl sheet, polyester fabric, corrugated paper and cartons. Therefore, we valued these inputs using their respective per–kilogram market– economy purchase prices. See New–Tec Preliminary Analysis Memorandum. Where applicable, we also adjusted these values to account for freight costs incurred between the supplier and respondent. See Surrogate Value Memorandum, Feili Preliminary Analysis Memorandum, and New–Tec Preliminary Analysis Memorandum. To value hydrochloric acid used in the production of FMTCs, we used per– kilogram import values obtained from Chemical Weekly. We adjusted this value for taxes and to account for freight costs incurred between the supplier and each respondent, respectively. We used per–kilogram import values obtained from the WTA for all other material inputs used in the production of FMTCs. To value diesel oil and liquid petroleum gas, we used per–kilogram values obtained from Bharat Petroleum published on December 2003 and used in the FMTC Second Review. We also made adjustments to account for inflation and freight costs incurred between the supplier and respondents. To value electricity, we used the 2000 electricity price data from International Energy Agency, Energy Prices and Taxes - Quarterly Statistics (First Quarter 2003), available at http:// www.eia.doe.gov/emeu/international/ elecprii.html, adjusted for inflation. To value water, we used the Revised Maharashtra Industrial Development Corporation (‘‘MIDC’’) water rates for June 1, 2003, available at http:// www.midcindia.com/water–supply, adjusted for inflation. For direct labor, indirect labor and packing labor, consistent with 19 CFR 351.408(c)(3), we used the PRC regression–based wage rate as reported on Import Administration’s home page. See Expected Wages of Selected NME Countries (revised November 2005) PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 (available at http://ia.ita.doc.gov/wages). The source of these wage rate data on the Import Administration’s web site is the Yearbook of Labour Statistics 2003, ILO, (Geneva: 2003), Chapter 5B: Wages in Manufacturing. The years of the reported wage rates range from 1998 to 2003. Because this regression–based wage rate does not separate the labor rates into different skill levels or types of labor, we have applied the same wage rate to all skill levels and types of labor reported by each respondent. For factory overhead, selling, general, and administrative expenses (‘‘SG&A’’), and profit values, we used information from Godrej and Boyce Manufacturing Co. Ltd. for the year ending March 31, 2005. From this information, we were able to determine factory overhead as a percentage of the total raw materials, labor and energy (‘‘ML&E’’) costs; SG&A as a percentage of ML&E plus overhead (i.e., cost of manufacture); and the profit rate as a percentage of the cost of manufacture plus SG&A. See Surrogate Value Memorandum for a full discussion of the calculation of these ratios. For packing materials, we used the per–kilogram values obtained from the WTA and made adjustments to account for freight costs incurred between the PRC supplier and respondent. Currency Conversion We made currency conversions into U.S. dollars, in accordance with section 773A(a) of the Act, based on the exchange rates in effect on the dates of the U.S. sales, as certified by the Federal Reserve Bank. Preliminary Results of Review We preliminarily determine that the following weighted–average dumping margins exist: Manufacturer/Exporter Feili* .................................. New–Tec* ......................... The PRC–wide Entity** .... Margin (Percent) 0.35 0.11 70.71 * de minimis ** including Anji Jiu, Xiamen Zehui, and Yixiang Disclosure We will disclose the calculations used in our analysis to parties to this proceeding within five days of the publication date of this notice. See 19 CFR 351.224(b). Interested parties are invited to comment on the preliminary results and may submit case briefs and/ or written comments within 30 days of the date of publication of this notice. See 19 CFR 351.309(c)(ii). Any interested party may request a hearing E:\FR\FM\10JYN1.SGM 10JYN1 38860 Federal Register / Vol. 71, No. 131 / Monday, July 10, 2006 / Notices within 30 days of publication of this notice. See 19 CFR 351.310(c). Any hearing, if requested, will be held 42 days after the date of publication of this notice. See 19 CFR 351.310(d). Rebuttal briefs and rebuttals to written comments, limited to issues raised in such briefs or comments, may be filed no later than 35 days after the date of publication. See 19 CFR 351.309(d). The Department requests that parties submitting written comments also provide the Department with an additional copy of those comments on diskette. The Department will issue the final results of this administrative review, which will include the results of its analysis of issues raised in any such comments, within 120 days of publication of these preliminary results, pursuant to section 751(a)(3)(A) of the Act. sroberts on PROD1PC70 with NOTICES Assessment Rates The Department will determine, and CBP shall assess, antidumping duties on all appropriate entries. The Department will issue, as appropriate, appraisement instructions directly to CBP within 15 days of publication of these final results of administrative review. In accordance with 19 CFR 351.212(b), we calculated an exporter/importer (or customer)specific assessment rate for the merchandise subject to this review. Where the respondent has reported reliable entered values, we calculated for all U.S. sales to each importer (or customer)-specific ad valorem rates by aggregating the dumping margins calculated for all U.S. sales to each importer (or customer) and dividing this amount by the total entered quantity of the sales to each importer (or customer). Where an importer (or customer)specific ad valorem rate is greater than de minimis, we will apply the assessment rate to the entered value of the importer’s/customer’s entries during the review period. Where we do not have entered values for all U.S. sales, we calculated a per–unit assessment rate by aggregating the antidumping duties due for al U.S. sales to each importer (or customer) and dividing this amount by the total quantity sold to that importer (or customer). To determine whether the duty assessment rates are de minimis, in accordance with the requirement set forth in 19 CFR 351.106(c)(2), we calculated importer (or customer)-specific ad valorem rates based on the estimated entered value. Where an importer (or customer)specific ad valorem rate is zero or de minimis, we will instruct CBP to liquidate appropriate entries without regard to antidumping duties. VerDate Aug<31>2005 17:10 Jul 07, 2006 Jkt 208001 Cash Deposit Requirements DEPARTMENT OF COMMERCE The following cash deposit requirements will be effective upon publication of the final results of this administrative review for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided for by section 751(a)(2)(C) of the Act: (1) for the above–listed respondents, which have a separate rate, the cash deposit rate will be the company–specific rate established in the final results of review (except, if the rate is zero or de minimis, no cash deposit will be required); (2) for previously investigated or reviewed PRC and non–PRC exporters not listed above that have separate rates, the cash deposit rate will continue to be the exporter–specific rate published for the most recent period; (3) for all PRC exporters of subject merchandise that have not been found to be entitled to a separate rate, the cash deposit rate will be the PRC–wide rate of 70.71 percent; and (4) for all non–PRC exporters of subject merchandise which have not received their own rate, the cash deposit rate will be the rate applicable to the PRC exporters that supplied that non– PRC exporter. These deposit requirements, when imposed, shall remain in effect until publication of the final results of the next administrative review. International Trade Administration Notification to Importers This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary’s presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties. This determination is issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act. Dated: June 30, 2006. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E6–10740 Filed 7–7–06; 8:45 am] BILLING CODE 3510–DS–S PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 A–570–832 Continuation of Antidumping Duty Order: Pure Magnesium from the People’s Republic of China Import Administration, International Trade Administration, Department of Commerce. SUMMARY: As a result of the determinations by the Department of Commerce (‘‘Department’’) and the International Trade Commission (‘‘Commission’’) that revocation of this antidumping duty order would be likely to lead to continuation or recurrence of dumping and material injury to an industry in the United States, pursuant to section 751(c) of the Tariff Act of 1930, as amended (‘‘the Act’’), the Department hereby orders the continuation of the antidumping duty order on pure magnesium from the People’s Republic of China (‘‘the PRC’’). The Department is publishing notice of the continuation of this antidumping duty order. EFFECTIVE DATE: July 10, 2006. FOR FURTHER INFORMATION CONTACT: Hilary E. Sadler, Esq. or Jim Nunno, AD/ CVD Operations, Office 8, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Ave., NW, Washington, DC 20230; telephone: (202) 482–4340 or (202) 482– 0783, respectively. SUPPLEMENTARY INFORMATION: AGENCY: Background On September 1, 2005, the Department initiated and the Commission instituted a sunset review of the antidumping duty order on pure magnesium from the PRC pursuant to section 751(c) of the Act. See Initiation of Five–Year (‘‘Sunset’’) Reviews, 70 FR 52074 (September 1, 2005). As a result of its review, the Department found that revocation of the antidumping duty order would be likely to lead to continuation or recurrence of dumping and notified the Commission of the magnitude of the margins likely to prevail were the order to be revoked. See Pure Magnesium from the People’s Republic of China; Notice of Final Results of Expedited Sunset Review of Antidumping Duty Order, 71 FR 580 (January 5, 2006). The Commission determined, pursuant to section 751(c) of the Act, that revocation of the antidumping duty order on pure magnesium from the PRC would be likely to lead to continuation E:\FR\FM\10JYN1.SGM 10JYN1

Agencies

[Federal Register Volume 71, Number 131 (Monday, July 10, 2006)]
[Notices]
[Pages 38852-38860]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-10740]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-868]


Folding Metal Tables and Chairs from the People's Republic of 
China: Preliminary Results of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

SUMMARY: The Department of Commerce (``the Department'') is conducting 
an administrative review of the antidumping duty order on folding metal 
tables and chairs (``FMTCs'') from the People's Republic of China 
(``PRC'') covering the period June 1, 2004, through May 31, 2005. We 
have preliminarily determined that sales have not been made below 
normal value (``NV'') by Feili Furniture Development Limited Quanzhou 
City, Feili Furniture Development Co., Ltd., Feili Group (Fujian) Co., 
Ltd., Feili (Fujian) Co., Ltd. (collectively ``Feili''), and New-Tec 
Integration (Xiamen) Co. Ltd. (``New-Tec''). Further, we have 
preliminarily determined to apply an adverse facts available (``AFA'') 
rate to all sales and entries of the subject merchandise during the 
period of review (``POR'') for Anji Jiu Zhou Machinery Co., Ltd. 
(``Anji Jiu''), Xiamen Zehui Industry Trade Co. (``Xiamen Zehui''), and 
Yixiang Blow Mold Yuyao Co., Ltd. (``Yixiang''). If these preliminary 
results are adopted in our final results of this review, we will 
instruct U.S. Customs and Border Protection (``CBP'') to assess 
antidumping duties on all appropriate entries of subject merchandise 
during the POR.
    Interested parties are invited to comment on these preliminary 
results. We intend to issue the final results no later than 120 days 
from the date of publication of this notice, pursuant to section 
751(a)(3)(A) of the Tariff Act of 1930, as amended (``the Act'').

EFFECTIVE DATE: July 10, 2006.

FOR FURTHER INFORMATION CONTACT: Laurel LaCivita or Matthew Quigley, 
AD/CVD Operations, Office 8, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
4243 or (202) 482-4551, respectively.

SUPPLEMENTARY INFORMATION: On June 27, 2002, the Department published 
the antidumping duty order on FMTCs from the PRC. See Antidumping Duty 
Order: Folding Metal Tables and Chairs From the People's Republic of 
China, 67 FR 43277 (June 27, 2002). On June 1, 2005, the Department 
published a notice of opportunity to request an administrative review 
of this order. See Antidumping or Countervailing Duty Order, Finding, 
or Suspended Investigation; Opportunity to Request Administrative 
Review, 70 FR 31422 (June 1, 2005). In accordance with 19 CFR 351. 
213(b)(1), the following requests were made: (1) on June 27, 2005, 
Cosco Home and Office Products (``Cosco''), a U.S. importer of subject 
merchandise, requested that the Department conduct an administrative 
review of Feili and New-Tec; (2) on June 28, 2005, Meco Corporation 
(``Meco''), a domestic interested party, requested that the Department 
review Feili's and New-Tec's sales and entries during the POR; (3) on 
June 30, 2005, FDL, Inc. (``FDL''), a U.S. importer of the subject 
merchandise, requested that the Department review all sales and entries 
of Anji Jiu, Xiamen Zehui, and Yixiang.
    On July 21, 2005, the Department initiated this administrative 
review with respect to Feili, New-Tec, Anji Jiu, Xiamen Zehui, and 
Yixiang. See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Request for Revocation in Part, 70 FR 42028 
(July 21, 2005). The Department issued antidumping duty questionnaires 
to all of the above-named respondents on August 16, 2005.
    On September 13, 2005, Feili and New-Tec submitted their Section A 
questionnaire responses (``AQRs''). New-Tec submitted its Sections C 
and D questionnaire response (``CQR'' and ``DQR'') on October 11, 2005, 
and Feili submitted its CQR, DQR, and its sales and cost reconciliation 
on October 13, 2005.
    On November 8, 2005, the Department issued its first supplemental 
Section A questionnaire to New-Tec, and on November 29, 2005, the 
Department issued its first supplemental Sections A, C, D, and cost 
reconciliation questionnaire to Feili. New-Tec submitted its 
supplemental Section A questionnaire response on November 29, 2005, and 
Feili submitted its first supplemental questionnaire response (``SQR'') 
on December 21, 2005. New-Tec submitted its sales and cost 
reconciliation on January 20, 2006. On February 7, 2006, the Department 
issued its second supplemental questionnaire to Feili. Feili responded 
on February 23, 2006. The Department issued its second supplemental 
questionnaire to New-Tec on March 15, 2006, and its third supplemental 
questionnaire to Feili on March 22, 2006. On April 12, 2006, Feili 
submitted its third supplemental questionnaire response (``3\rd\ SQR'') 
and New-Tec submitted its second supplemental questionnaire response. 
On May 2, 2006, the Department issued its third supplemental 
questionnaire to New-Tec. New-Tec provided its 3\rd\ SQR on May 18, 
2006. The Department issued its fourth supplemental questionnaire to 
Feili on May 16, 2006. On May 30, 2006, Feili submitted its fourth 
supplemental questionnaire response. The Department issued its fifth 
supplemental questionnaire to Feili on June 7, 2006, and Feili 
responded on June 19, 2006. Anji Jiu, Xiamen Zehui, and Yixiang did not 
respond to the Department's questionnaire. See ``Adverse Facts 
Available'' section, below.
    The Department requested interested parties to submit surrogate 
value information on March 21, 2006, and to provide surrogate country 
selection comments on April 7, 2006. See Memorandum to File from Cathy 
Feig, International Trade Compliance Analyst, through Charles Riggle, 
Program Manager, AD/CVD Operations, Office 8, ``Surrogate Value 
Submission Deadline: Folding Metal Tables and Chairs from the Peoples 
Republic of China'' (March 21, 2006); and Letter from Charles Riggle, 
Program Manager, AD/CVD Operations, Office 8, to Feili, New-Tec, Cosco, 
Meco, and Resilient Furniture, ``Re: Administrative Review of Folding 
Metal Tables and Chairs from the People's Republic of China,'' (April 
7, 2006). On April 21, 2006, Feili and Meco provided comments on 
publicly available information to value the factors of production 
(``FOP''). None of the interested parties provided comments on the 
selection of a surrogate country.
    On February 28, 2006, the Department published a notice in the 
Federal Register extending the time limit for the preliminary results 
of review until June 30, 2006. See Folding Metal Tables and Chairs From 
the People's Republic of China: Notice of Extension of Time Limit for 
the Preliminary Results of the Antidumping Duty Administrative Review, 
71 FR 10008, (February 28, 2006).

Period of Review

    The POR is June 1, 2004, through May 31, 2005.

[[Page 38853]]

Scope of the Order

    The products covered by this order consist of assembled and 
unassembled folding tables and folding chairs made primarily or 
exclusively from steel or other metal, as described below:
    (1) Assembled and unassembled folding tables made primarily or 
exclusively from steel or other metal (folding metal tables). Folding 
metal tables include square, round, rectangular, and any other shapes 
with legs affixed with rivets, welds, or any other type of fastener, 
and which are made most commonly, but not exclusively, with a hardboard 
top covered with vinyl or fabric. Folding metal tables have legs that 
mechanically fold independently of one another, and not as a set. The 
subject merchandise is commonly, but not exclusively, packed singly, in 
multiple packs of the same item, or in five piece sets consisting of 
four chairs and one table. Specifically excluded from the scope of the 
order regarding folding metal tables are the following:
    a. Lawn furniture;
    b. Trays commonly referred to as ``TV trays'';
    c. Side tables;
    d. Child-sized tables;
    e. Portable counter sets consisting of rectangular tables 36'' high 
and matching stools; and,
    f. Banquet tables. A banquet table is a rectangular table with a 
plastic or laminated wood table top approximately 28'' to 36'' wide by 
48'' to 96'' long and with a set of folding legs at each end of the 
table. One set of legs is composed of two individual legs that are 
affixed together by one or more cross-braces using welds or fastening 
hardware. In contrast, folding metal tables have legs that mechanically 
fold independently of one another, and not as a set.
    (2) Assembled and unassembled folding chairs made primarily or 
exclusively from steel or other metal (folding metal chairs). Folding 
metal chairs include chairs with one or more cross-braces, regardless 
of shape or size, affixed to the front and/or rear legs with rivets, 
welds or any other type of fastener. Folding metal chairs include: 
those that are made solely of steel or other metal; those that have a 
back pad, a seat pad, or both a back pad and a seat pad; and those that 
have seats or backs made of plastic or other materials. The subject 
merchandise is commonly, but not exclusively, packed singly, in 
multiple packs of the same item, or in five piece sets consisting of 
four chairs and one table. Specifically excluded from the scope of the 
order regarding folding metal chairs are the following:
    a. Folding metal chairs with a wooden back or seat, or both;
    b. Lawn furniture;
    c. Stools;
    d. Chairs with arms; and
    e. Child-sized chairs.
    The subject merchandise is currently classifiable under subheadings 
9401.71.0010, 9401.71.0030, 9401.79.0045, 9401.79.0050, 9403.20.0010, 
9403.20.0030, 9403.70.8010, 9403.70.8020, and 9403.70.8030 of the 
Harmonized Tariff Schedule of the United States (``HTSUS''). Although 
the HTSUS subheadings are provided for convenience and customs 
purposes, the Department's written description of the merchandise is 
dispositive.

Non-Market Economy Country Status

    Neither Feili nor New-Tec contested the Department's treatment of 
the PRC as a non-market economy (``NME''), and the Department has 
treated the PRC as an NME country in all past antidumping duty 
investigations and administrative reviews and continues to do so in 
this case. See, e.g., Honey from the People's Republic of China: Final 
Results and Final Rescission, In Part, of Antidumping Duty 
Administrative Review, 71 FR 34893 (June 16, 2006) (``Honey''); and 
Final Determination of Sales at Less Than Fair Value and Final Partial 
Affirmative Determination of Critical Circumstances: Diamond Sawblades 
and Parts Thereof from the People's Republic of China, 71 FR 29303 (May 
22, 2006) (``Sawblades''). No interested party in this case has argued 
that we should do otherwise. Designation as an NME country remains in 
effect until it is revoked by the Department. See Section 771(18)(C)(i) 
of the Act.

Surrogate Country

    Section 773(c)(1) of the Act directs the Department to base NV on 
the NME producer's FOPs, valued in a surrogate market-economy country 
or countries considered to be appropriate by the Department. In 
accordance with section 773(c)(4) of the Act, in valuing the FOPs, the 
Department shall use, to the extent possible, the prices or costs of 
the FOPs in one or more market-economy countries that are: (1) at a 
level of economic development comparable to that of the NME country; 
and (2) significant producers of comparable merchandise. The sources of 
the surrogate factor values are discussed under the ``Normal Value'' 
section below and in the Memorandum from Laurel LaCivita and Matthew 
Quigley, International Trade Compliance Analysts, through Charles 
Riggle, Program Manager, to Wendy Frankel, Director, AD/CVD Operations, 
Office 8, ``Preliminary Results of the 2004-2005 Administrative Review 
of Folding Metal Tables and Chairs from the People's Republic of China: 
Surrogate Value Memorandum'' (June 30, 2006) (``Surrogate Value 
Memorandum'').
    The Department has previously determined that India, Indonesia, Sri 
Lanka, the Philippines, and Egypt are countries comparable to the PRC 
in terms of economic development. See Memorandum from Ron Lorentzen to 
Wendy Frankel, Director, AD/CVD Enforcement, Office 8, ``Administrative 
Review of Folding Metal Tables and Chairs (`Tables and Chairs') from 
the People's Republic of China (`PRC'): Request for a List of Surrogate 
Countries'' (December 20, 2005) (``Policy Memorandum''). Customarily, 
we select an appropriate surrogate country from the Policy Memorandum 
based on the availability and reliability of data from the countries 
that are significant producers of comparable merchandise. In this case, 
we have found that India is a significant producer of comparable 
merchandise. See Memorandum from Laurel LaCivita and Matthew Quigley, 
International Trade Compliance Analysts, through Charles Riggle Program 
Manager, to Wendy Frankel, Director, AD/CVD Operations, Office 8, 
``Antidumping Administrative Review of Folding Metal Tables and Chairs: 
Selection of a Surrogate Country,'' (June 30, 2006) (``Surrogate 
Country Memorandum'').
    The Department used India as the primary surrogate country and, 
accordingly, has calculated NV using Indian prices to value the PRC 
producers' FOPs, when available and appropriate. See Surrogate Country 
Memorandum and Surrogate Value Memorandum. We have obtained and relied 
upon publicly available information wherever possible.
    In accordance with 19 CFR 351.301(c)(3)(ii), for the final results 
in an antidumping administrative review, interested parties may submit 
publicly available information to value factors of production within 20 
days after the date of publication of the preliminary results of 
review.

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 assigned a single 
antidumping duty deposit rate. It is the Department's policy to assign 
all exporters of subject merchandise subject

[[Page 38854]]

to review in an NME country a single rate unless an exporter can 
demonstrate that it is sufficiently independent of government control 
to be entitled to a separate rate. See, e.g., Honey from the People's 
Republic of China: Preliminary Results and Partial Rescission of 
Antidumping Duty Administrative Review, 70 FR 74764, 74765 (December 
16, 2005) (unchanged in the final results); and Sawblades, 71 FR at 
29307.
    We have considered whether each reviewed company based in the PRC 
is eligible for a separate rate. The Department's separate-rate test to 
determine whether the exporters are independent from government control 
does not consider, in general, macroeconomic/border-type controls, 
e.g., export licenses, quotas, and minimum export prices, particularly 
if these controls are imposed to prevent dumping. The test focuses, 
rather, on controls over the investment, pricing, and output decision-
making process at the individual firm level. See, e.g., Tapered Roller 
Bearings and Parts Thereof, Finished and Unfinished, From the People's 
Republic of China: Final Results of Antidumping Administrative Review, 
62 FR 61276, 61279 (November 17, 1997); and Preliminary Determination 
of Sales at Less than Fair Value: Honey from the People's Republic of 
China, 60 FR 14725,14727-28 (March 20, 1995).
    To establish whether an exporter is sufficiently independent of 
government control to be entitled to a separate rate, the Department 
analyzes the exporter in light of select criteria, discussed below. See 
Final Determination of Sales at Less Than Fair Value: Sparklers from 
the People's Republic of China, 56 FR 20585, 22587 (May 6, 1991) 
(``Sparklers''); and 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''). Under this test, exporters in NME 
countries are entitled to separate, company-specific margins when they 
can demonstrate an absence of government control over exports, both in 
law (``de jure'') and in fact (``de facto'').
    Feili and New-Tec each provided company-specific separate-rate 
information and stated that each met the standards for the assignment 
of separate rates. Anji Jiu, Xiamen Zehui, and Yixiang did not submit 
any information to establish their entitlement to a separate rate. 
Feili reported that it is wholly owned by market-economy entities. See 
Feili's AQR, at 2 and Exhibit A-3. Therefore, a separate rates analysis 
is not necessary to determine whether Feili's export activities are 
independent from government control. See e.g., Brake Rotors From the 
People's Republic of China: Preliminary Results of the Tenth New 
Shipper Review, 69 FR 30875, 30876 (June 1, 2004) (unchanged in final 
results); 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); Preliminary Results of First New Shipper 
Review and First Antidumping Duty Administrative Review: Certain 
Preserved Mushrooms From the People's Republic of China, 65 FR 66703, 
66705 (November 7, 2000) (unchanged in the final results of review); 
and Notice of Final Determination of Sales at Less Than Fair Value: 
Bicycles From the People's Republic of China, 61 FR 19026, 19027 (April 
30, 1996) (``Bicycles''). For New Tec, a separate rates analysis is 
necessary to determine whether its export activities are independent 
from government control.
    A. Absence of De Jure Control
    The Department considers the following de jure criteria in 
determining whether an individual company may be granted a separate 
rate: (1) an absence of restrictive stipulations associated with an 
individual exporter's business and export licenses; (2) any legislative 
enactments decentralizing control of companies; or (3) any other formal 
measures by the government decentralizing control of companies. See 
Sparklers, 56 FR 20588.
    New-Tec is a joint venture owned by New-Tec International Inc., a 
South Korean company, and Xiamen Integration Co., Ltd., a PRC company. 
New-Tec has placed documents on the record to demonstrate the absence 
of de jure control including its list of shareholders, business 
license, and the Company Law of the People's Republic of China, as 
revised October 27, 2005 (``Company Law''). Other than limiting New-Tec 
to activities referenced in the business license, we found no 
restrictive stipulations associated with the license. In addition, in 
previous cases the Department has analyzed the Company Law and found 
that it establishes an absence of de jure control. See, e.g., Certain 
Non-Frozen Apple Juice Concentrate from the People's Republic of China: 
Final Results, Partial Recision and Termination of a Partial Deferral 
of the 2002-2003 Administrative Review, 69 FR 65148, 65150 (November 
10, 2004). We have no information in this segment of the proceeding 
that would cause us to reconsider this determination. Therefore, based 
on the foregoing, we have preliminarily found an absence of de jure 
control for New-Tec.
    B. Absence of De Facto Control
    As stated in previous cases, there is some evidence that certain 
enactments of the PRC central government have not been implemented 
uniformly among different sectors and/or jurisdictions in the PRC. See, 
e.g., Notice of Final Determination of Sales at Less Than Fair Value: 
Certain Preserved Mushrooms from the People's Republic of China, 63 FR 
72255, 72257 (December 31, 1998). Therefore, the Department has 
preliminarily determined that an analysis of de facto control is 
critical in determining whether respondents are, in fact, subject to a 
degree of government control that would preclude the Department from 
assigning separate rates. The Department typically considers four 
factors in evaluating whether each respondent is subject to de facto 
government control of its export functions: (1) whether the exporter 
sets its own export prices independent of the government and without 
the approval of a government 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 its management; and (4) whether 
the respondent retains the proceeds of its export sales and makes 
independent decisions regarding disposition of profits or financing of 
losses. See, e.g., Final Determination of Sales at Less Than Fair 
Value: Furfuryl Alcohol From the People's Republic of China, 60 FR 
22544, 22545 (May 8, 1995).
    With regard to de facto control, New-Tec reported that: (1) it 
independently set prices to the United States through negotiations with 
customers and these prices are not subject to review by any government 
organization; (2) it did not coordinate with other exporters or 
producers to set the price or to determine to which market the 
companies will sell subject merchandise; (3) the PRC Chamber of 
Commerce does not coordinate the export activities of New-Tec; (4) its 
general manager has the authority to contractually bind it to sell 
subject merchandise; (5) its board of directors appoint its general 
manager; (6) there is no restriction on its use of export revenues; (7) 
its shareholders ultimately determine the disposition of respective 
profits, and New-Tec has not had a loss in the last two years; and (8) 
none of New-Tec's board members or managers is a government official. 
Additionally, New-Tec's questionnaire responses did not suggest that 
pricing is coordinated among exporters. Furthermore, our

[[Page 38855]]

analysis New-Tec's questionnaire responses reveals no other information 
indicating government control of its export activities. Therefore, 
based on the information on the record, we preliminarily determine that 
there is an absence of de facto government control with respect tor 
New-Tec's export functions and that New-Tec has met the criteria for 
the application of a separate rate.

Adverse Facts Available

    Sections 776(a)(1) and (2) of the Act provide that the Department 
shall apply ``facts otherwise available'' if, inter alia, necessary 
information is not on the record or an interested party or any other 
person: (A) withholds information that has been requested; (B) fails to 
provide information within the deadlines established, or in the form 
and manner requested by the Department, subject to subsections (c)(1) 
and (e) of section 782 of the Act; (C) significantly impedes a 
proceeding; or (D) provides information that cannot be verified as 
provided by section 782(i) of the Act.
    Where the Department determines that a response to a request for 
information does not comply with the request, section 782(d) of the Act 
provides that the Department will so inform the party submitting the 
response and will, to the extent practicable, provide that party the 
opportunity to remedy or explain the deficiency. If the party fails to 
remedy the deficiency within the applicable time limits and subject to 
section 782(e) of the Act, the Department may disregard all or part of 
the original and subsequent responses, as appropriate. Section 782(e) 
of the Act provides that the Department ``shall not decline to consider 
information that is submitted by an interested party and is necessary 
to the determination but does not meet all applicable requirements 
established by the administering authority'' if the information is 
timely, can be verified, is not so incomplete that it cannot be used, 
and if the interested party acted to the best of its ability in 
providing the information. Where all of these conditions are met, the 
statute requires the Department to use the information if it can do so 
without undue difficulties.
    Section 776(b) of the Act further provides that the Department may 
use an adverse inference in applying the facts otherwise available when 
a party has failed to cooperate by not acting to the best of its 
ability to comply with a request for information. Section 776(b) of the 
Act also authorizes the Department to use as AFA information derived 
from the petition, the final determination, a previous administrative 
review, or other information placed on the record.
    Section 776(c) of the Act provides that, when the Department relies 
on secondary information rather than on information obtained in the 
course of an investigation or review, it shall, to the extent 
practicable, corroborate that information from independent sources that 
are reasonably at its disposal. Secondary information is defined as 
``[lsqb]i[rsqb]nformation derived from the petition that gave rise to 
the investigation or review, the final determination concerning the 
subject merchandise, or any previous review under section 751 
concerning the subject merchandise.'' See Statement of Administrative 
Action (``SAA'') accompanying the Uruguay Round Agreements Act, H. Doc. 
No. 316, 103d Cong., 2d Session at 870 (1994). Corroborate means that 
the Department will satisfy itself that the secondary information to be 
used has probative value. See SAA at 870. To corroborate secondary 
information, the Department will, to the extent practicable, examine 
the reliability and relevance of the information to be used. The SAA 
emphasizes, however, that the Department need not prove that the 
selected facts available are the best alternative information. See SAA 
at 869.
    For the reasons discussed below, we determine that, in accordance 
with sections 776(a)(2) and 776(b) of the Act, the use of AFA is 
appropriate for the preliminary results for the PRC-wide entity, 
including Anji Jiu, Xiamen Zehui, and Yixiang.

Anji Jiu, Xiamen Zehui, and Yixiang

    Anji Jiu, Xiamen Zehui, and Yixiang did not respond to our August 
16, 2005, questionnaire. In the Initiation Notice, the Department 
stated that if one of the companies on which we initiated a review does 
not qualify for a separate rate, all other exporters of FMTCs from the 
PRC who have not qualified for a separate rate are deemed to be covered 
by this review as part of the single PRC-wide entity of which the named 
exporter is a part. See Initiation Notice at n.1. Because Anji Jiu, 
Xiamen Zehui, and Yixiang did not submit any information to establish 
their eligibility for a separate rate, we find they are deemed to be 
part of the PRC-wide entity. See Separate Rates section above.

The PRC-Wide Rate and Use of AFA

    In addition, because we have determined that Anji Jiu, Xiamen 
Zehui, and Yixiang are not entitled to separate rates and are now part 
of the PRC-wide entity, the PRC-wide entity is now under review. We 
further find that because the PRC-wide entity (including Anji Jiu, 
Xiamen Zehui, and Yixiang) failed to provide the requested information 
in the administrative review, the Department, pursuant to section 
776(a) of the Act, has applied a dumping margin for the PRC-wide entity 
using the facts otherwise available on the record. Furthermore, because 
we have determined that the PRC-wide entity (including Anji Jiu, Xiamen 
Zehui, and Yixiang) has failed to cooperate to the best of its ability, 
the Department has used an adverse inference in making its 
determination, pursuant to section 776(b) of the Act.

Selection of the Adverse Facts Available Rate

    In deciding which facts to use as AFA, section 776(b) of the Act 
and 19 CFR 351.308(c)(1) authorize the Department to rely on 
information derived from (1) the petition, (2) a final determination in 
the investigation, (3) any previous review or determination, or (4) any 
information placed on the record. It is the Department's practice to 
select, as AFA, the highest calculated rate in any segment of the 
proceeding. See, e.g., Certain Cased Pencils from the People's Republic 
of China; Notice of Preliminary Results of Antidumping Duty 
Administrative Review and Intent to Rescind in Part, 70 FR 76755, 76761 
(December 28, 2005).
    The Court of International Trade (``CIT'') and the Court of Appeals 
for the Federal Circuit (``Fed. Cir.'') have consistently upheld the 
Department's practice. See Rhone Poulenc, Inc. v. United States, 899 F. 
2d 1185, 1190 (Fed. Cir. 1990) (upholding the Department's presumption 
that the highest margin was the best information of current margins) 
(``Rhone Poulenc''); NSK Ltd. v. United States, 346 F. Supp. 2d 1312, 
1335 (CIT 2004) (upholding a 73.55 percent total AFA rate, the highest 
available dumping margin from a different respondent in a less-than-
fair-value (``LTFV'') investigation); Kompass Food Trading 
International v. United States, 24 CIT 678, 683 (2000) (upholding a 
51.16 percent total AFA rate, the highest available dumping margin from 
a different, fully cooperative respondent); and Shanghai Taoen 
International Trading Co., Ltd. v. United States, 360 F. Supp. 2d 1339, 
1348 (CIT 2005) (upholding a 223.01 percent total AFA rate, the highest 
available dumping margin from a different respondent in a previous 
administrative review).
    The Department's practice when selecting an adverse rate from among 
the possible sources of information is to ensure that the margin is 
sufficiently

[[Page 38856]]

adverse ``as to effectuate the purpose of the facts available role to 
induce respondents to provide the Department with complete and accurate 
information in a timely manner.'' See Notice of Final Determination of 
Sales at Less than Fair Value: Static Random Access Memory 
Semiconductors From Taiwan; 63 FR 8909, 8932 (February 23, 1998). The 
Department's practice also ensures ``that the party does not obtain a 
more favorable result by failing to cooperate than if it had cooperated 
fully.'' See SAA at 870. See also, 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 69937, 69939 (November 18, 2005). In choosing the 
appropriate balance between providing respondents with an incentive to 
respond accurately and imposing a rate that is reasonably related to 
the respondents' prior commercial activity, selecting the highest prior 
margin ``reflects a common sense inference that the highest prior 
margin is the most probative evidence of current margins, because, if 
it were not so, the importer, knowing of the rule, would have produced 
current information showing the margin to be less.'' See Rhone Poulenc, 
899 F. 2d at 1190.
    Due to Anji Jiu's, Xiamen Zehui's, and Yixiang's failure to 
cooperate in this administrative review, we have preliminarily assigned 
the PRC-wide entity, of which they are deemed to be a part, an AFA rate 
of 70.71 percent, which is the PRC-wide rate determined in the 
investigation and the rate currently applicable to the PRC-wide entity. 
See Notice of Amended Final Determination of Sales at Less Than Fair 
Value: Folding Metal Tables and Chairs From the People's Republic of 
China, 67 FR 34898, (May 16, 2002) (``FMTC Amended Final 
Determination'').
    The Department preliminarily determines that this information is 
the most appropriate from the available sources to effectuate the 
purposes of AFA. The Department's reliance on the PRC-wide rate from 
the original investigation to determine an AFA rate is subject to the 
requirement to corroborate secondary information. See Section 776(c) of 
the Act and the ``Corroboration of Secondary Information'' section 
below.

Corroboration of Secondary Information

    Section 776(c) of the Act provides that, where the Department 
selects from among the facts otherwise available and relies on 
``secondary information,'' the Department shall, to the extent 
practicable, corroborate that information from independent sources 
reasonably at the Department's disposal. Secondary information is 
described in the SAA as ``information derived from the petition that 
gave rise to the investigation or review, the final determination 
concerning the subject merchandise, or any previous review under 
section 751 concerning the subject merchandise.'' See SAA at 870. The 
SAA states that ``corroborate'' means to determine that the information 
used has probative value. The Department has determined that to have 
probative value information must be reliable and relevant. See Tapered 
Roller Bearings and Parts Thereof, Finished and Unfinished, From Japan, 
and Tapered Roller Bearings, Four Inches or Less in Outside Diameter, 
and Components Thereof, From Japan; Preliminary Results of Antidumping 
Duty Administrative Reviews and Partial Termination of Administrative 
Reviews, 61 FR 57391, 57392 (November 6, 1996). The SAA also states 
that independent sources used to corroborate such evidence may include, 
for example, published price lists, official import statistics and 
customs data, and information obtained from interested parties during 
the particular investigation. See SAA at 870. See also, Notice of 
Preliminary Determination of Sales at Less Than Fair Value: High and 
Ultra-High Voltage Ceramic Station Post Insulators from Japan, 68 FR 
35627, 35629 (June 16, 2003); and Notice of Final Determination of 
Sales at Less Than Fair Value: Live Swine From Canada, 70 FR 12181, 
12183 (March 11, 2005) (``Live Swine from Canada'').
    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, the Department disregarded the highest 
margin as adverse best information available (the predecessor to facts 
available) because it was based on another company's uncharacteristic 
business expense that resulted in an unusually high margin. See Fresh 
Cut Flowers From Mexico; Final Results of Antidumping Duty 
Administrative Review, 61 FR 6812, 6814 (February 22, 1996) (``Fresh 
Cut Flowers from Mexico''). Similarly, the Department does not apply a 
margin that has been discredited. See D&L Supply Co. v. United States, 
113 F. 3d 1220, 1223-4 (Fed. Cir. 1997) (finding that the Department 
will not use a margin that has been judicially invalidated).
    With regard to the relevance of the rate used, the Department notes 
that the rate used is the rate currently applicable to the PRC-wide 
entity and there is no information that indicates this rate is no 
longer relevant to the PRC-wide entity. In addition, we compared the 
margin calculations of Feili and New-Tec in this administrative review 
with the PRC-wide entity margin from the LTFV investigation and used in 
the first and second administrative reviews of this case. The 
Department found that the margin of 70.71 percent was within the range 
of the highest margins calculated for the respondents on the record of 
this administrative review. See Memorandum to the File from Laurel 
LaCivita and Matthew Quigley, International Trade Compliance Analysts, 
through Charles Riggle, Program Manager, AD/CVD Operations, Office 8, 
``Folding Metal Tables and Chairs from the PRC: Corroboration of the 
PRC-wide Adverse Facts-Available Rate,'' (June 30, 2006) 
(``Corroboration Memorandum''). Because the record of this 
administrative review contains margins within the range of 70.71 
percent, this further supports that this rate continues to be relevant 
for use in this administrative review.
    As we have determined, to the extent practicable, that the margin 
selected is both reliable and relevant, we determine that it has 
probative value. As a result, the Department determines that the margin 
is corroborated within the meaning of section 776(c) of the Act for the 
purposes of this administrative review and may reasonably be applied to 
the PRC-wide entity as AFA. Accordingly, we determine that the highest 
rate from any segment of this administrative proceeding, 70.71 percent, 
meets the corroboration criterion established in section 776(c) of the 
Act that secondary information have probative value.
    Because these are the preliminary results of review, the Department 
will consider all margins on the record at the time of the final 
results of review for the purpose of determining the most appropriate 
final margin for the PRC-wide entity. See Notice of Preliminary 
Determination of Sales at Less Than Fair Value: Solid Fertilizer Grade 
Ammonium Nitrate From the Russian Federation, 65 FR 1139, 1141 (January 
7, 2000).

Date of Sale

    Section 351.401(i) of the Department's regulations states that:

[[Page 38857]]

    in identifying the date of sale of the subject merchandise or 
foreign like product, the Secretary normally will use the date of 
invoice, as recorded in the exporter or producer's records kept in the 
normal course of business. However, the Secretary may use a date other 
than the date of invoice if the Secretary is satisfied that a different 
date better reflects the date on which the exporter or producer 
establishes the material terms of sale.

See also, Allied Tube and Conduit Corp. v. United States, 132 F. Supp. 
2d 1087, 1090-1093 (CIT 2001) (upholding the Department's rebuttable 
presumption that invoice date is the appropriate date of sale). After 
examining the questionnaire responses and the sales documentation 
placed on the record by Feili and New-Tec, we preliminarily determine 
that invoice date is the most appropriate date of sale for each 
respondent. We made this determination based on statements on the 
record that indicate that Feili's and New-Tec's invoices establish the 
material terms of sale to the extent required by our regulations. See 
Feili CQR at C-11 and New-Tec CQR at C-12. Nothing on the record rebuts 
the presumption that invoice date should be the date of sale. See 
Notice of Preliminary Determination of Sales at Less Than Fair Value: 
Saccharin From the People's Republic of China, 67 FR 79049, 79054 
(December 27, 2002).

Normal Value Comparisons

    To determine whether sales of FMTCs to the United States by Feili 
and New-Tec were made at less than NV, we compared export price 
(``EP'') to NV, as described in the ``Export Price,'' and ``Normal 
Value'' sections of this notice, pursuant to section 771(35) of the 
Act.

Export Price

    Because Feili and New-Tec sold subject merchandise to unaffiliated 
purchasers in the United States prior to importation into the United 
States (or to unaffiliated resellers outside the United States with 
knowledge that the merchandise was destined for the United States) and 
use of a constructed-export-price methodology is not otherwise 
indicated, we have used EP in accordance with section 772(a) of the 
Act.
    We calculated EP based on the FOB or delivered price to 
unaffiliated purchasers for Feili and New-Tec. From this price, we 
deducted amounts for foreign inland freight, brokerage and handling, 
and where applicable, air freight, pursuant to section 772(c)(2)(A) of 
the Act. See Memorandum to the File from Laurel LaCivita, Senior 
International Trade Compliance Analyst, through Charles Riggle, Program 
Manager, AD/CVD Operations, Office 8, ``Analysis for the Preliminary 
Results of the 2004-2005 Administrative Review of Folding Metal Tables 
and Chairs from the People's Republic of China: Feili Furniture 
Development Limited Quanzhou City, Feili Furniture Development Co., 
Ltd., Feili Group (Fujian) Co., Ltd., Feili (Fujian) Co., Ltd. 
(collectively, 'Feili')'' (June 30, 2006) (``Feili Preliminary Analysis 
Memorandum''); and Memorandum to the File from Matthew Quigley, 
International Trade Compliance Analyst, through Charles Riggle, Program 
Manager, AD/CVD Operations, Office 8, ``Analysis for the Preliminary 
Results of the 2004-2005 Administrative Review of Folding Metal Tables 
and Chairs from the People's Republic of China: New-Tec Integration 
(Xiamen) Co. Ltd. (``New-Tec'')'' (June 30, 2006) (``New-Tec 
Preliminary Analysis Memorandum'').
    The Department used two sources to calculate a surrogate value for 
domestic brokerage expenses. The Department averaged December 2003-
November 2004 data contained in Essar Steel's February 28, 2005, public 
version response submitted in the antidumping duty administrative 
review of hot-rolled carbon steel flat products from India. See Certain 
Hot-Rolled Carbon Steel Flat Products From India: Notice of Preliminary 
Results of Antidumping Duty Administrative Review, 71 FR 2018 (January 
12, 2006). This data was averaged with the February 2004-January 2005 
data contained in Agro Dutch Industries Limited's (``Agro Dutch'') May 
24, 2005, public version response submitted in the administrative 
review of the antidumping duty order on certain preserved mushrooms 
from India. See Certain Preserved Mushrooms From India: Final Results 
of Antidumping Duty Administrative Review, 70 FR 37757 (June 30, 2005); 
and Notice of Preliminary Determination of Sales at Less Than Fair 
Value, Affirmative Critical Circumstances, In Part, and Postponement of 
Final Determination: Certain Lined Paper Products from the People's 
Republic of China, 71 FR 19695, 19704 (April 17, 2006) (utilizing this 
same data). The brokerage expense data reported by Essar Steel and Agro 
Dutch in their public versions are ranged data. The Department first 
derived an average per-unit amount from each source. Then the 
Department adjusted each average rate for inflation. Finally, the 
Department averaged the two per-unit amounts to derive an overall 
average rate for the POR. See Surrogate Value Memorandum at 8 and 
Attachment XVI.
    To value truck freight, we used the freight rates published by 
Indian Freight Exchange, available at http://www.infreight.com. The 
truck freight rates are contemporaneous with the POR; therefore, we 
made no adjustments for inflation. Where applicable, we valued air 
freight using the rates published in the UPS website: http://
www.ups.com. We adjusted these rates for inflation using the U.S. 
Consumer Price Index published by the U.S. Department of Labor, Bureau 
of Labor Statistics, available on http://data.bls.gov because the 
surrogate values for air freight were derived from U.S. sources. See 
Surrogate Value Memorandum at 7-8 and Attachment XVII.

Zero-Priced Transactions

    During the course of this review, both Feili and New-Tec reported a 
significant number of zero-priced transactions to their U.S. customers. 
See Feili's 1\st\ SQR at 9 and Exhibit 13; and New-Tec's 3\rd\ SQR at 
Exhibit 9. An analysis of the Section C databases provided by each 
company reveals that both companies made a significant number of zero-
priced transactions with customers that had purchased the same 
merchandise in commercial quantities. See Feili Preliminary Analysis 
Memorandum at Attachment I; and New-Tec Preliminary Analysis Memorandum 
at Attachment I. In the final results of the second administrative 
review of FMTCs, we included New-Tec's zero-priced transactions in the 
margin calculation stating that the record demonstrated that: (1) New-
Tec provided many pieces of the same product, indicating that these 
``samples'' did not primarily serve for evaluation or testing of the 
merchandise; (2) New-Tec provided significant numbers of the same 
product to its U.S. customer while that customer was purchasing that 
same product; (3) New-Tec provided ``samples'' to the same customers to 
whom it was selling the same products in commercial quantities; (4) 
New-Tec acknowledged that it gave these products at zero price to its 
U.S. customers (already purchasing the same items) to sell to their own 
customers. See FMTC Second Review and accompanying Issues and Decision 
Memorandum at Comment 4. As a result, we concluded that New-Tec was not 
providing samples to entice its U.S. customers to buy the product. 
Ibid.

[[Page 38858]]

    The Federal Circuit has not required the Department to exclude 
zero-priced or de minimis sales from its analysis, but rather, has 
defined a sale as requiring ``both a transfer of ownership to an 
unrelated party and consideration.'' See NSK Ltd. v. United States, 115 
F.3d 965, 975 (Fed. Cir. 1997). The CIT in NSK Ltd. v. United States 
stated that it saw ``little reason in supplying and re-supplying and 
yet re-supplying the same product to the same customer in order to 
solicit sales if the supplies are made in reasonably short periods of 
time,'' and that ``it would be even less logical to supply a sample to 
a client that has made a recent bulk purchase of the very item being 
sampled by the client.'' NSK Ltd v. United States, 217 F. Supp. 2d 
1291, 1311-1312 (CIT 2002). Furthermore, the Courts have consistently 
ruled that the burden rests with a respondent to demonstrate that it 
received no consideration in return for its provision of purported 
samples. See, e.g., Zenith Electronics Corp. v. United States, 988 F. 
2d 1573, 1583 (Fed. Cir. 1993) (explaining that the burden of 
evidentiary production belongs ``to the party in possession of the 
necessary information''). See, also, Tianjin Machinery Import & Export 
Corp. v. United States, 806 F. Supp. 1008, 1015 (CIT 1992) (``The 
burden of creating an adequate record lies with respondents and not 
with {the Department{time} .'') (citation omitted). Moreover, 
``{e{time} ven where the Department does not ask a respondent for 
specific information that would enable it to make an exclusion 
determination in the respondent's favor, the respondent has the burden 
of proof to present the information in the first place with its request 
for exclusion.'' See Ball Bearings and Parts Thereof from France, 
Germany, Italy, Japan, Singapore, and the United Kingdom: Final Results 
of Antidumping Duty Administrative Reviews, 70 FR 54711 (September 16, 
2005), and accompanying Issues and Decision Memorandum at Comment 8 
(citing NTN Bearing Corp. of America. v. United States, 997 F. 2d 1453, 
1458 (Fed. Cir. 1993)).
    An analysis of Feili's and New-Tec's Section C computer sales 
listings reveals that both companies provided zero-priced merchandise 
to the same customers to whom they were selling or had sold the same 
products in commercial quantities, with the exception of one of Feili's 
customers, who did not make any purchases of subject merchandise during 
the POR. See Feili Preliminary Analysis Memorandum at Attachment I, 
Surrogate Value Memorandum, and New-Tec Preliminary Analysis Memorandum 
at Attachment I. In addition, Feili stated that it sometimes provided 
samples to its customers so that those customers could provide samples 
to their customers in turn. See Feili 3\rd\ SQR at 2. Consequently, 
based on the facts cited above, the guidance of past CIT decisions, and 
consistent with the decision in the previous review, from the 
preliminary results of this review, we have not excluded zero-priced 
transactions from the margin calculation of this case for either Feili 
or New-Tec, with the exception of certain sales Feili made to a new 
customer that did not purchase any subject merchandise during the POR.

Normal Value

    Section 773(c)(1) of the Act provides that, in the case of an NME, 
the Department shall determine NV using an FOP methodology if the 
merchandise is exported from an NME 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 FOP because the presence of government controls on 
various aspects of these economies renders price comparisons and the 
calculation of production costs invalid under our normal methodologies. 
Therefore, we calculated NV based on FOP in accordance with sections 
773(c)(3) and (4) of the Act and 19 CFR 351.408(c).
    The FOPs include: (1) hours of labor required; (2) quantities of 
raw materials employed; (3) amounts of energy and other utilities 
consumed; and (4) representative capital costs. We used the FOPs 
reported by respondents for materials, energy, labor, by-products, and 
packing.
    In accordance with 19 CFR 351.408(c)(1), the Department will 
normally use publicly available information to value the FOPs, but when 
a producer sources an input from a market-economy country and pays for 
it in market-economy currency, the Department will normally value the 
factor using the actual price paid for the input. See 19 CFR 
351.408(c)(1); see also, Lasko Metal Products v. United States, 43 F.3d 
1442, 1445-1446 (Fed. Cir. 1994) (affirming the Department's use of 
market-based prices to value certain FOPs). Feili and New-Tec each 
reported that a significant portion of their purchases of cold-rolled 
steel, hot-rolled steel, steel wire rod, polypropylene plastic resin, 
polyurethane foam, powder coating, washers, screws, rivets, fibreboard, 
polyester fabric, corrugated paper and cartons were sourced from 
market-economy countries and paid for in market-economy currencies. See 
Feili's DQR at D-7 and New-Tec's DQR at D-7. Pursuant to 19 CFR 
351.408(c)(1), we used the actual price paid by respondents for inputs 
purchased from a market-economy supplier and paid for in a market-
economy currency, except when prices may have been distorted by 
findings of dumping by the PRC and/or subsidies.
    With regard to both the Indian import-based surrogate values and 
the market-economy input values, we have disregarded prices that we 
have reason to believe or suspect may be subsidized. We have reason to 
believe or suspect that prices of inputs from India, Indonesia, South 
Korea, and Thailand may have been subsidized. We have found in other 
proceedings that these countries maintain broadly available, non-
industry-specific export subsidies and, therefore, it is reasonable to 
infer that all exports to all markets from these countries may be 
subsidized. See Certain Frozen Fish Fillets from the Socialist Republic 
of Vietnam: Notice of Preliminary Results and Preliminary Partial 
Rescission of Antidumping Duty Administrative Review, 70 FR 54007, 
54011 (September 13, 2005) (unchanged in the final results); Automotive 
Replacement Glass Windshields From the People's Republic of China: 
Final Results of Administrative Review, 69 FR 61790 (October 21, 2004) 
and accompanying Issues and Decision Memorandum at Comment 5; and China 
National Machinery Import & Export Corporation v. United States, 293 F. 
Supp. 2d 1334 (CIT 2003), as affirmed by the Federal Circuit, 104 Fed. 
Appx. 183 (Fed. Cir. 2004). We are also guided by the statute's 
legislative history that explains that it is not necessary to conduct a 
formal investigation to ensure that such prices are not subsidized. See 
H.R. Rep. 100-576 at 590 (1988). Rather, the Department was instructed 
by Congress to base its decision on information that is available to it 
at the time it is making its determination. Therefore, we have not used 
prices from these countries either in calculating the Indian import-
based surrogate values or in calculating market-economy input values. 
In instances where a market-economy input was obtained solely from 
suppliers located in these countries, we used Indian import-based 
surrogate values to value the input. See Feili Preliminary Analysis 
Memorandum and New-Tec Preliminary Analysis Memorandum.
    Furthermore, we did not use any market-economy purchases of 
polyvinyl chloride from Taiwan, on which the

[[Page 38859]]

PRC has an outstanding antidumping duty order. See World Trade 
Organization's Committee on Anti-Dumping Practices Semi-Annual Report 
Under Article 16.4 of the Agreement, G/ADP/N/CHN, for the period 1 July 
- 31 December 2005, available at www.wto.org. See Surrogate Value 
Memorandum at Attachment XIX.

Factor Valuations

    In accordance with section 773(c) of the Act, we calculated NV 
based on the FOPs reported by respondents for the POR. To calculate NV, 
the reported per-unit factor quantities were multiplied by publicly 
available Indian surrogate values (except as 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 render 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 (i.e., where the sales terms 
for the market-economy inputs were not delivered to the factory). This 
adjustment is in accordance with the decision of the Federal Circuit in 
Sigma Corp. v. United States. Sigma Corp. v. United States, 117 F. 3d 
1401, 1408 (Fed. Cir. 1997). For a detailed description of all 
surrogate values used for respondents, see the Surrogate Value 
Memorandum.
    Except as noted below, we valued raw material inputs using the 
weighted-average unit import values derived from the Monthly Statistics 
of the Foreign Trade of India, as published by the Directorate General 
of Commercial Intelligence and Statistics of the Ministry of Commerce 
and Industry, Government of India in the World Trade Atlas, available 
at http://www.gtis.com/wta.htm (``WTA''). The WTA data are reported in 
rupees and are contemporaneous with the POR. See also, Surrogate Value 
Memorandum at Attachment V. Where necessary, we adjusted the surrogate 
values to reflect inflation/deflation using the Indian Wholesale Price 
Index (``WPI'') as published on the Reserve Bank of India (``RBI'') 
website, available at www.rbi.org.in. We further adjusted these prices 
to account for freight costs incurred between the suppler and 
respondent. We used the freight rates published by Indian Freight 
Exchange available at http://www.infreight.com, to value truck freight. 
We valued rail freight using the freight rates published by the Indian 
Railways and available at http://www.indianrailways.gov.in/railway/ 
freightrates/freight--charges--2003.htm. The truck and rail freight 
rates are contemporaneous with the POR. Therefore, we made no 
adjustments for inflation. For a complete description of the factor 
values we used, see the Surrogate Value Memorandum.
    Feili and New-Tec reported they had market-economy purchases 
representing a meaningful portion of the total purchases of each 
respective input for cold-rolled steel, hot-rolled steel, steel wire 
rod, polypropylene plastic resin, polyurethane foam, powder coating, 
washers, screws, rivets, fibreboard, vinyl sheet, polyester fabric, 
corrugated paper and cartons. Therefore, we valued these inputs using 
their respective per-kilogram market-economy purchase prices. See New-
Tec Preliminary Analysis Memorandum. Where applicable, we also adjusted 
these values to account for freight costs incurred between the supplier 
and respondent. See Surrogate Value Memorandum, Feili Preliminary 
Analysis Memorandum, and New-Tec Preliminary Analysis Memorandum.
    To value hydrochloric acid used in the production of FMTCs, we used 
per-kilogram import values obtained from Chemical Weekly. We adjusted 
this value for taxes and to account for freight costs incurred between 
the supplier and each respondent, respectively. We used per-kilogram 
import values obtained from the WTA for all other material inputs used 
in the production of FMTCs.
    To value diesel oil and liquid petroleum gas, we used per-kilogram 
values obtained from Bharat Petroleum published on December 2003 and 
used in the FMTC Second Review. We also made adjustments to account for 
inflation and freight costs incurred between the supplier and 
respondents.
    To value electricity, we used the 2000 electricity price data from 
International Energy Agency, Energy Prices and Taxes - Quarterly 
Statistics (First Quarter 2003), available at http://www.eia.doe.gov/
emeu/international/elecprii.html, adjusted for inflation.
    To value water, we used the Revised Maharashtra Industrial 
Development Corporation (``MIDC'') water rates for June 1, 2003, 
available at http://www.midcindia.com/water-supply, adjusted for 
inflation.
    For direct labor, indirect labor and packing labor, consistent with 
19 CFR 351.408(c)(3), we used the PRC regression-based wage rate as 
reported on Import Administration's home page. See Expected Wages of 
Selected NME Countries (revised November 2005) (available at http://
ia.ita.doc.gov/wages). The source of these wage rate data on the Import 
Administration's web site is the Yearbook of Labour Statistics 2003, 
ILO, (Geneva: 2003), Chapter 5B: Wages in Manufacturing. The years of 
the reported wage rates range from 1998 to 2003. Because this 
regression-based wage rate does not separate the labor rates into 
different skill levels or types of labor, we have applied the same wage 
rate to all skill levels and types of labor reported by each 
respondent.
    For factory overhead, selling, general, and administrative expenses 
(``SG&A''), and profit values, we used information from Godrej and 
Boyce Manufacturing Co. Ltd. for the year ending March 31, 2005. From 
this information, we were able to determine factory overhead as a 
percentage of the total raw materials, labor and energy (``ML&E'') 
costs; SG&A as a percentage of ML&E plus overhead (i.e., cost of 
manufacture); and the profit rate as a percentage of the cost of 
manufacture plus SG&A. See Surrogate Value Memorandum for a full 
discussion of the calculation of these ratios.
    For packing materials, we used the per-kilogram values obtained 
from the WTA and made adjustments to account for freight costs incurred 
between the PRC supplier and respondent.

Currency Conversion

    We made currency conversions into U.S. dollars, in accordance with 
section 773A(a) of the Act, based on the exchange rates in effect on 
the dates of the U.S. sales, as certified by the Federal Reserve Bank.

Preliminary Results of Review

    We preliminarily determine that the following weighted-average 
dumping margins exist:

------------------------------------------------------------------------
                 Manufacturer/Exporter                  Margin (Percent)
------------------------------------------------------------------------
Feili[ast]............................................              0.35
New-Tec[ast]..........................................              0.11
The PRC-wide Entity[ast][ast].........................             70.71
------------------------------------------------------------------------
[ast] de minimis
[ast][ast] including Anji Jiu, Xiamen Zehui, and Yixiang

Disclosure

    We will disclose the calculations used in our analysis to parties 
to this proceeding within five days of the publication date of this 
notice. See 19 CFR 351.224(b). Interested parties are invited to 
comment on the preliminary results and may submit case briefs and/or 
written comments within 30 days of the date of publication of this 
notice. See 19 CFR 351.309(c)(ii). Any interested party may request a 
hearing

[[Page 38860]]

within 30 days of publication of this notice. See 19 CFR 351.310(c). 
Any hearing, if requested, will be held 42 days after the date of 
publication of this notice. See 19 CFR 351.310(d). Rebuttal briefs and 
rebuttals to written comments, limited to issues raised in such briefs 
or comments, may be filed no later than 35 days after the date of 
publication. See 19 CFR 351.309(d). The Department requests that 
parties submitting written comments also provide the Department with an 
additional copy of those comments on diskette. The Department will 
issue the final results of this administrative review, which will 
include the results of its analysis of issues raised in any such 
comments, within 120 days of publication of these preliminary results, 
pursuant to section 751(a)(3)(A) of the Act.

Assessment Rates

    The Department will determine, and CBP shall assess, antidumping 
duties on all appropriate entries. The Department will issue, as 
appropriate, appraisement instructions directly to CBP within 15 days 
of publication of these final results of administrative review. In 
accordance with 19 CFR 351.212(b), we calculated an exporter/importer 
(or customer)-specific assessment rate for the merchandise subject to 
this review. Where the respondent has reported reliable entered values, 
we calculated for all U.S. sales to each importer (or customer)-
specific ad valorem rates by aggregating the dumping margins calculated 
for all U.S. sales to each importer (or customer) and dividing this 
amount by the total entered quantity of the sales to each importer (or 
customer). Where an importer (or customer)-specific ad valorem rate is 
greater than de minimis, we will apply the assessment rate to the 
entered value of the importer's/customer's entries during the review 
period. Where we do not have entered values for all U.S. sales, we 
calculated a per-unit assessment rate by aggregating the antidumping 
duties due for al U.S. sales to each importer (or customer) and 
dividing this amount by the total quantity sold to that importer (or 
customer). To determine whether the duty assessment rates are de 
minimis, in accordance with the requirement set forth in 19 CFR 
351.106(c)(2), we calculated importer (or customer)-specific ad valorem 
rates based on the estimated entered value. Where an importer (or 
customer)-specific ad valorem rate is zero or de minimis, we will 
instruct CBP to liquidate appropriate entries without regard to 
antidumping duties.

Cash Deposit Requirements

    The following cash deposit requirements will be effective upon 
publication of the final results of this administrative review for all 
shipments of the subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication date, as 
provided for by section 751(a)(2)(C) of the Act: (1) for the above-
listed respondents, which have a separate rate, the cash deposit rate 
will be the company-specific rate established in the final results of 
review (except, if the rate is zero or de minimis, no cash deposit will 
be required); (2) for previously investigated or reviewed PRC and non-
PRC exporters not listed above that have separate rates, the cash 
deposit rate will continue to be the exporter-specific rate published 
for the most recent period; (3) for all PRC exporters of subject 
merchandise that have not been found to be entitled to a separate rate, 
the cash deposit rate will be the PRC-wide rate of 70.71 percent; and 
(4) for all non-PRC exporters of subject merchandise which have not 
received their own rate, the cash deposit rate will be the rate 
applicable to the PRC exporters that supplied that non-PRC exporter. 
These deposit requirements, when imposed, shall remain in effect until 
publication of the final results of the next administrative review.

Notification to Importers

    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    This determination is issued and published in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: June 30, 2006.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E6-10740 Filed 7-7-06; 8:45 am]
BILLING CODE 3510-DS-S