Certain Frozen Warmwater Shrimp From Thailand: Preliminary Results and Partial Rescission of Antidumping Duty Administrative Review, 10669-10680 [E7-4278]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 72, Number 46 (Friday, March 9, 2007)]
[Notices]
[Pages 10669-10680]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-4278]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-549-822]


Certain Frozen Warmwater Shrimp From Thailand: Preliminary 
Results and Partial Rescission 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 certain frozen 
warmwater shrimp from Thailand with respect to 27 companies.\1\ The 
respondents which the Department selected for individual review are 
Good

[[Page 10670]]

Luck Product Co., Ltd. (Good Luck Product), Pakfood Public Company 
Limited and its affiliated subsidiaries, Asia Pacific (Thailand) 
Company Limited, Chaophyraya Cold Storage Company Limited, Okeanos 
Company Limited, and Takzin Samut Company Limited (collectively 
``Pakfood''), and Thai I-Mei Frozen Foods Co., Ltd. (Thai I-Mei). The 
respondents which were not selected for individual review are listed in 
the ``Preliminary Results of Review'' section of this notice. This is 
the first administrative review of this order. The review covers the 
period August 4, 2004, through January 31, 2006.
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    \1\ This figure does not include those companies for which the 
Department is preliminarily rescinding the administrative review.
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    We preliminarily determine that sales were made by Good Luck 
Product, Pakfood, and Thai I-Mei below normal value (NV). In addition, 
based on the preliminary results for the respondents selected for 
individual review, we have preliminarily determined a weighted-average 
margin for those companies that were not selected for individual review 
but were responsive to the Department's requests for information. For 
those companies which were not responsive to the Department's requests 
for information, we have preliminarily assigned to them a margin based 
on adverse facts available (AFA).
    If the preliminary results are adopted in our final results of 
administrative review, we will instruct U.S. Customs and Border 
Protection (CBP) to assess antidumping duties on all appropriate 
entries. Interested parties are invited to comment on the preliminary 
results.

DATES: Effective Date:
    March 9, 2007.

FOR FURTHER INFORMATION CONTACT: Irina Itkin or Alice Gibbons, AD/CVD 
Operations, Office 2, Import Administration-Room B099, International 
Trade Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
0656 or (202) 482-0498, respectively.

SUPPLEMENTARY INFORMATION:

Background

    In February 2005, the Department published in the Federal Register 
an antidumping duty order on certain frozen warmwater shrimp from 
Thailand. See Notice of Amended Final Determination of Sales at Less 
Than Fair Value and Antidumping Duty Order: Certain Frozen Warmwater 
Shrimp from Thailand, 70 FR 5145 (Feb. 1, 2005) (Shrimp Order). On 
February 1, 2006, the Department published in the Federal Register a 
notice of opportunity to request an administrative review of the 
antidumping duty order of certain frozen warmwater shrimp from Thailand 
for the period August 4, 2004, through January 31, 2006. See 
Antidumping and Countervailing Duty Order, Finding, or Suspended 
Investigation; Opportunity to Request Administrative Review, 71 FR 5239 
(Feb. 1, 2006). On February 28, 2006, the petitioner \2\ submitted a 
letter timely requesting that the Department conduct an administrative 
review of the sales of certain frozen warmwater shrimp made by numerous 
companies during the period of review (POR), pursuant to section 751(a) 
of the Tariff Act of 1930, as amended (the Act), and in accordance with 
19 CFR 351.213(b)(1). Also, on February 28, 2006, the Department 
received requests to conduct an administrative review of the 
antidumping duty order on certain frozen warmwater shrimp from the 
following producers/exporters of subject merchandise during the POR in 
accordance with 19 CFR 351.213(b)(2): Kitchens of the Ocean (Thailand), 
Ltd., Pakfood, Thai I-Mei, Thai Union Frozen Products and Thai Union 
Seafood (collectively, ``Thai Union''), and Union Frozen Products 
(UFP).
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    \2\ The petitioner is the Ad Hoc Shrimp Trade Action Committee.
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    On April 7, 2006, the Department published a notice of initiation 
of administrative review for 145 companies and requested that each 
provide data on the quantity and value (Q&V) of its exports of subject 
merchandise to the United States during the POR for mandatory 
respondent selection purposes. These companies are listed in the 
Department's notice of initiation. See Notice of Initiation of 
Administrative Reviews of the Antidumping Duty Orders on Certain Frozen 
Warmwater Shrimp from Brazil, Ecuador, India and Thailand, 71 FR 17819 
(Apr. 7, 2006) (Notice of Initiation).
    During the period April 24, 2006, through July 10, 2006, we 
received responses to the Department's Q&V questionnaire from 106 
companies.\3\ We were unable to locate six companies, and we did not 
receive responses to this questionnaire from the remaining 
companies.\4\ For further discussion, see the ``Application of Facts 
Available'' section of this notice.
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    \3\ We note that we initiated a review on six of these companies 
(i.e., Haitai Seafood Co., Ltd., Kingfisher Holdings Limited, Klang 
Co., Ltd, Inter-Oceanic Resources Co., Ltd., Narong Seafood Co., 
Ltd., Sea Bonanza Foods Co., Ltd.) as if they were two different 
entities based on the two different addresses on the record for each 
company. However, we have determined, based on the responses 
submitted by these companies, that each comprises a single entity 
with two different addresses.
    \4\ As discussed below, for some of these companies, the 
petitioner subsequently withdrew its request for review.
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    Based upon our consideration of the responses to the Q&V 
questionnaire received and the resources available to the Department, 
we determined that it was not practicable to examine all exporters/
producers of subject merchandise for which a review was requested. As a 
result, on July 11, 2006, we selected the three largest producers/
exporters of certain frozen warmwater shrimp from Thailand during the 
POR, Good Luck Product, Pakfood, and Thai I-Mei, as the mandatory 
respondents in this proceeding. See the Memorandum to Stephen J. 
Claeys, Deputy Assistant Secretary for Import Administration, from 
Irene Darzenta Tzafolias, Acting Director, Office 2, AD/CVD Operations, 
entitled, ``Antidumping Duty Administrative Review of Certain Frozen 
Warmwater Shrimp from Thailand: Selection of Respondents,'' dated July 
11, 2006. On this same date, we issued the antidumping duty 
questionnaire to Good Luck Product, Pakfood, and Thai I-Mei.
    On July 20, 2006, we published a notice rescinding the 
administrative review with respect to 112 companies for which the 
requests for an administrative review were withdrawn in a timely 
manner, in accordance with 19 CFR 351.213(d)(1). See Certain Frozen 
Warmwater Shrimp from Thailand; Partial Rescission of Antidumping Duty 
Administrative Review, 71 FR 41200 (July 20, 2006) (Partial Rescission 
Notice). See also, the Memorandum to the File from Brianne Riker 
entitled ``Intent to Rescind in Part the Antidumping Duty 
Administrative Review on Frozen Warmwater Shrimp from Thailand,'' dated 
June 22, 2006.
    On August 3, 2006, we published a notice amending the partial 
rescission of the administrative review to correct a typographical 
error. See Certain Frozen Warmwater Shrimp from Thailand; Corrected 
Partial Rescission of Antidumping Duty Administrative Review, 71 FR 
44017 (Aug. 3, 2006).
    We received responses to section A of the questionnaire from 
Pakfood on August 8, 2006, and from Good Luck Product and Thai I-Mei on 
August 16, 2006.
    On August 25, 2006, the Department postponed the preliminary 
results in this review until no later than February 28, 2007. See 
Certain Frozen Warmwater Shrimp from Brazil, Ecuador, India, the 
Socialist Republic of Vietnam, the People's Republic of China, and 
Thailand: Notice of Extension of Time Limits for the Preliminary 
Results of the First Administrative Reviews and New

[[Page 10671]]

Shipper Reviews, 71 FR 50387 (Aug. 25, 2006).
    On August 29, 2006, the petitioner submitted comments regarding 
home market viability with respect to Good Luck Product and Pakfood.
    We received responses to sections B and C of the questionnaire from 
Pakfood and Good Luck Product on September 1 and 5, 2006, respectively. 
In addition, we received a response to sections C and D of the 
questionnaire from Thai I-Mei on September 5, 2006.
    On September 8 and 13, 2006, Pakfood and Good Luck Product, 
respectively, responded to the petitioner's comments regarding home 
market viability. For further discussion, see ``Home Market Viability 
and Selection of Comparison Markets'' section of this notice.
    On September 14, 2006, we published an additional notice amending 
the partial rescission of the administrative review to correct a 
typographical error. See Certain Frozen Warmwater Shrimp from Thailand; 
Corrected Partial Rescission of Antidumping Duty Administrative Review, 
71 FR 54268 (Sept. 14, 2006).
    We received comments from the petitioner on September 15, 2006, 
regarding the application of the multinational corporation (MNC) 
provision in section 773(d) of the Act with respect to Thai I-Mei.
    On September 19, 2006, we issued a supplemental sales questionnaire 
to Pakfood.
    On September 20, 2006, the petitioner requested that the Department 
initiate a sales-below-cost investigation of Pakfood.
    On September 21, 2006, we issued a supplemental sales questionnaire 
to Thai I-Mei.
    On September 26, 2006, Thai I-Mei submitted a response to the 
petitioner's comments regarding the application of the MNC provision in 
section 773(d) of the Act with respect to Thai I-Mei.
    On September 27, 2006, we issued a supplemental sales questionnaire 
to Good Luck Product.
    We initiated a sales-below-cost investigation for Pakfood on 
October 3, 2006. See the Memorandum to James Maeder, Director, Office 
2, AD/CVD Operations, from The Team entitled, ``Petitioner's Allegation 
of Sales Below the Cost of Production for Pakfood Company Limited'' 
(Pakfood Cost Allegation).
    We received Pakfood's supplemental response on October 17, 2006. 
Also on October 17, 2006, we issued a supplemental cost questionnaire 
to Thai I-Mei.
    We received supplemental sales responses from Thai I-Mei and Good 
Luck Product on October 23 and 26, 2006, respectively.
    On October 27, 2006, the petitioner requested that the Department 
initiate a sales-below-cost investigation of Good Luck Product. This 
investigation for Good Luck Product was initiated on October 30, 2006. 
See the Memorandum to James Maeder, Director, Office 2, AD/CVD 
Operations from The Team entitled, ``Petitioner's Allegation of Sales 
Below the Cost of Production for Good Luck Product Co., Ltd.'' (Good 
Luck Product Cost Allegation).
    Pakfood submitted a response to section D of the questionnaire on 
November 2, 2006.
    On November 14, 2006, we issued a second sales supplemental 
questionnaire to Good Luck Product.
    We received a response to the supplemental cost questionnaire from 
Thai I-Mei on November 15, 2006.
    On November 16, 2006, we issued a supplemental cost questionnaire 
to Pakfood.
    We received a second supplemental sales response, as well as a 
response to section D of the questionnaire from Good Luck Product on 
November 22 and 30, 2006, respectively.
    On December 7, 2006, we issued a second sales supplemental 
questionnaire to Thai I-Mei. Also, on December 8, 2006, we issued a 
supplemental cost questionnaire to Good Luck Product.
    We received a supplemental cost response from Pakfood on December 
14, 2006.
    On December 21, 2006, we issued a supplemental cost questionnaire 
to Thai I-Mei.
    Sales verifications were conducted at Good Luck Product and Pakfood 
in December 2006. Sales verification reports were issued in January and 
February 2007 for Pakfood and Good Luck Product, respectively.
    On January 4, 2007, we received Good Luck Product's supplemental 
cost response, as well as Thai I-Mei's second supplemental sales 
response. In addition, we received a supplemental cost response from 
Thai I-Mei on January 10, 2006.
    On January 11, 2007, we issued a third supplemental sales 
questionnaire to Thai I-Mei.
    On January 19, 2007, based on the information on the record, we 
found that the MNC provision does not apply to Thai I-Mei. For further 
discussion, see the Memorandum to Stephen J. Claeys, Deputy Assistant 
Secretary for Import Administration from The Team entitled, 
``Application of the Multinational Corporation Provision,'' dated 
January 19, 2007.
    We received Thai I-Mei's third supplemental sales response on 
January 23, 2007. Also on this date, we published a correction to the 
scope of the order in which we clarified that the scope does not cover 
warmwater shrimp in non-frozen form. See Certain Frozen Warmwater 
Shrimp from Brazil, Ecuador, India, Thailand, the People's Republic of 
China and the Socialist Republic of Vietnam; Amended Orders, 72 FR 2857 
(Jan. 23, 2007).
    On January 24 and February 14, 2007, respectively, Pakfood and Good 
Luck Product submitted revised sales databases which incorporated 
certain minor corrections to these companies' data discovered at 
verification.
    We conducted cost verifications at Good Luck Product and Pakfood in 
January and February 2007.

Scope of the Order

    The scope of this order includes certain frozen warmwater shrimp 
and prawns, whether wild-caught (ocean harvested) or farm-raised 
(produced by aquaculture), head-on or head-off, shell-on or peeled, 
tail-on or tail-off,\5\ deveined or not deveined, cooked or raw, or 
otherwise processed in frozen form.
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    \5\ ``Tails'' in this context means the tail fan, which includes 
the telson and the uropods.
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    The frozen warmwater shrimp and prawn products included in the 
scope of this order, regardless of definitions in the Harmonized Tariff 
Schedule of the United States (HTSUS), are products which are processed 
from warmwater shrimp and prawns through freezing and which are sold in 
any count size.
    The products described above may be processed from any species of 
warmwater shrimp and prawns. Warmwater shrimp and prawns are generally 
classified in, but are not limited to, the Penaeidae family. Some 
examples of the farmed and wild-caught warmwater species include, but 
are not limited to, whiteleg shrimp (Penaeus vannemei), banana prawn 
(Penaeus merguiensis), fleshy prawn (Penaeus chinensis), giant river 
prawn (Macrobrachium rosenbergii), giant tiger prawn (Penaeus monodon), 
redspotted shrimp (Penaeus brasiliensis), southern brown shrimp 
(Penaeus subtilis), southern pink shrimp (Penaeus notialis), southern 
rough shrimp (Trachypenaeus curvirostris), southern white shrimp 
(Penaeus schmitti), blue shrimp (Penaeus stylirostris), western white 
shrimp (Penaeus occidentalis), and Indian white prawn (Penaeus 
indicus).

[[Page 10672]]

    Frozen shrimp and prawns that are packed with marinade, spices or 
sauce are included in the scope of this order. In addition, food 
preparations, which are not ``prepared meals,'' that contain more than 
20 percent by weight of shrimp or prawn are also included in the scope 
of this order.
    Excluded from the scope are: (1) Breaded shrimp and prawns (HTS 
subheading 1605.20.10.20); (2) shrimp and prawns generally classified 
in the Pandalidae family and commonly referred to as coldwater shrimp, 
in any state of processing; (3) fresh shrimp and prawns whether shell-
on or peeled (HTS subheadings 0306.23.00.20 and 0306.23.00.40); (4) 
shrimp and prawns in prepared meals (HTS subheading 1605.20.05.10); (5) 
dried shrimp and prawns; (6) canned warmwater shrimp and prawns (HTS 
subheading 1605.20.10.40); (7) certain dusted shrimp; and (8) certain 
battered shrimp. Dusted shrimp is a shrimp-based product: (1) That is 
produced from fresh (or thawed-from-frozen) and peeled shrimp; (2) to 
which a ``dusting'' layer of rice or wheat flour of at least 95 percent 
purity has been applied; (3) with the entire surface of the shrimp 
flesh thoroughly and evenly coated with the flour; (4) with the non-
shrimp content of the end product constituting between four and 10 
percent of the product's total weight after being dusted, but prior to 
being frozen; and (5) that is subjected to IQF freezing immediately 
after application of the dusting layer. Battered shrimp is a shrimp-
based product that, when dusted in accordance with the definition of 
dusting above, is coated with a wet viscous layer containing egg and/or 
milk, and par-fried.
    The products covered by this order are currently classified under 
the following HTSUS subheadings: 0306.13.00.03, 0306.13.00.06, 
0306.13.00.09, 0306.13.00.12, 0306.13.00.15, 0306.13.00.18, 
0306.13.00.21, 0306.13.00.24, 0306.13.00.27, 0306.13.00.40, 
1605.20.10.10, and 1605.20.10.30. These HTSUS subheadings are provided 
for convenience and for customs purposes only and are not dispositive, 
but rather the written description of the scope of this order is 
dispositive.

Partial Rescission of Review

    Eight of the companies that responded to the Department's Q&V 
questionnaire stated that they had no shipments/entries of subject 
merchandise into the United States during the POR. However, based on 
information obtained from CBP, it appeared that these companies did, in 
fact, have shipments or entries of subject merchandise that entered 
into the United States during the POR. See the Memorandum to the File 
from Brianne Riker, Analyst, Office 2, AD/CVD Operations, entitled, 
``2004-2006 Administrative Review of Certain Frozen Warmwater Shrimp 
from Thailand: Entry Documents from U.S. Customs and Border 
Protection,'' dated July 31, 2006. From September 2006 to February 
2007, we contacted seven of the eight companies in question and/or the 
exporters listed on the CBP entry documentation and requested that they 
provide information regarding the entries in question. We did not 
request information from one of the eight companies, Bangkok Dehydrated 
Marine Product Co., Ltd. (Bangkok Dehydrated Marine Product), because, 
based on CBP information, we found that the merchandise (i.e., dried 
shrimp) was not subject to the scope of the order.
    Based on either responses to the Department's solicitation or the 
CBP information, we have preliminarily determined that entries at issue 
by four of the eight exporters/producers, Bangkok Dehydrated Marine 
Product, Siam Ocean,\6\ Tep Kinsho,\7\ and Thai Agri,\8\ were not 
reportable transactions because they were either: (1) Non-subject 
merchandise (i.e., dried shrimp); (2) a non-paid sample; or, (3) 
reported by another company in its Q&V questionnaire. Therefore, in 
accordance with 19 CFR 351.213(d)(3), and consistent with the 
Department's practice, we are preliminarily rescinding our review with 
respect to these companies. See, e.g., Certain Steel Concrete 
Reinforcing Bars from Turkey; Final Results, Rescission of Antidumping 
Duty Administrative Review in Part, and Determination to Revoke in 
Part, 70 FR 67665, 67666 (Nov. 8, 2005).
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    \6\ We note that the response from this company indicated that 
its name is Siam Ocean Frozen Foods Co., Ltd.
    \7\ We note that the response from this company indicated that 
its name is Tep Kinsho Foods Co., Ltd.
    \8\ We note that the response from this company indicated that 
its name is Thai Agri Foods Co., Ltd.
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    One of the remaining exporters/producers, Siam Intersea Co., Ltd., 
provided additional information to the Department indicating that it 
did, in fact, have a reportable transaction during the POR. Therefore, 
we are not rescinding the administrative review with respect to this 
company and are preliminarily assigning to it a weighted-average margin 
calculated for the companies selected for individual review because, 
based on its response: (1) The discrepancy between the Q&V 
questionnaire response and the CBP data appeared to be an inadvertent 
oversight; (2) the quantity of the exports in question was so small 
that it would not have impacted our selection of respondents; and, (3) 
the company has been responsive to our requests for information.
    In addition, of the remaining two exporters/producers, NR Instant 
Produce \9\ and Surapon Nichirei Foods Co., Ltd. (Surapon) stated that 
they did not report the entries in question because they claimed that 
the entries were of non-subject merchandise. Because these goods were 
entered into the United States as subject merchandise and there is 
insufficient evidence on the record to conclude otherwise, we 
preliminarily determine that the merchandise in question is included 
within the scope of the order. As a result, we are preliminarily 
assigning NR Instant Produce and Surapon the weighted-average margin 
calculated for the companies selected for individual review because 
these companies have been responsive to our requests for information. 
We may request additional information on the products in question. If 
we ultimately determine the merchandise is not subject to the order, we 
will rescind the administrative review with respect to NR Instant 
Produce and Surapon.
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    \9\ We note that the response from this company indicated that 
its name is NR Instant Product Co., Ltd. (NR Instant Produce).
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    Finally, the remaining exporter/producer, Thai World,\10\ failed to 
respond to the Department's request for additional information and, 
thus, we find that it failed to act to the best of its ability. 
Therefore, we are not rescinding the administrative review with respect 
to Thai World. For further information, see the ``Application of Facts 
Available'' section of this notice.
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    \10\ We note that the response from this company indicated that 
its name is Thai World Imports and Exports Co., Ltd. (Thai World).
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Application of Facts Available

    Section 776(a) of the Act provides that the Department will apply 
``facts otherwise available'' if, inter alia, necessary information is 
not available on the record or an interested party: (1) Withholds 
information that has been requested by the Department; (2) fails to 
provide such information within the deadlines established, or in the 
form or manner requested by the Department, subject to subsections 
(c)(1) and (e) of section 782 of the Act; (3) significantly impedes a 
proceeding; or (4) provides such information, but the information 
cannot be verified.
    As discussed in the ``Background'' section, above, in April 2006, 
the

[[Page 10673]]

Department requested that all companies subject to the review respond 
to the Department's Q&V questionnaire for purposes of mandatory 
respondent selection. The original deadline to file a response was 
April 28, 2006. Of the 145 companies subject to review, 32 companies 
did not respond to the Department's initial requests for information. 
Subsequently in May 2006, the Department issued letters to these 
companies affording them a second opportunity to submit a response to 
the Department's Q&V questionnaire. However, six of these companies 
also failed to respond to the Department's second questionnaire.\11\ On 
January 31, 2007, the Department placed documentation on the record 
confirming delivery of the questionnaires to each company. See the 
Memorandum to the File from Brianne Riker, Analyst, Office 2, AD/CVD 
Operations, entitled, ``Placing Delivery Information on the Record of 
the 2004-2006 Antidumping Duty Administrative Review on Certain Frozen 
Warmwater Shrimp from Thailand,'' dated January 31, 2007. By failing to 
respond to the Department's Q&V questionnaire, these companies withheld 
requested information and significantly impeded the proceeding. Thus, 
pursuant to sections 776(a)(2)(A) and (C) of the Act, because these 
companies did not respond to the Department's questionnaire, the 
Department preliminarily finds that the use of total facts available is 
appropriate.
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    \11\ These companies are: Anglo-Siam Seafoods Co., Ltd. (Anglo-
Siam Seafoods), Fortune Frozen Foods (Thailand) Co., Ltd. (Fortune 
Frozen Foods), Gallant Ocean (Thailand) Co., Ltd. (Gallant Ocean), 
Li-Thai Frozen Foods Co., Ltd. (Li-Thai), Queen Marine Food Co., 
Ltd. (Queen Marine Foods), and Smile Heart Foods.
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    Furthermore, one company, Thai World, claimed that it made no 
shipments of subject merchandise to the United States during the POR. 
Because we were unable to confirm the accuracy of Thai World's claim 
with CBP, we requested further information/clarification from it. 
However, Thai World failed to provide the requested information/
clarification. By doing so, Thai World withheld requested information 
and significantly impeded the proceeding. Therefore, pursuant to 
sections 776(a)(2)(A) and (C) of the Act, the Department also 
preliminarily finds that the use of total facts available with respect 
to Thai World is appropriate.
    According to section 776(b) of the Act, if the Department finds 
that an interested party fails to cooperate by not acting to the best 
of its ability to comply with requests for information, the Department 
may use an inference that is adverse to the interests of that party in 
selecting from the facts otherwise available. See also Notice of Final 
Results of Antidumping Duty Administrative Review: Stainless Steel Bar 
from India, 70 FR 54023, 54025-26 (Sept. 13, 2005); and Notice of Final 
Determination of Sales at Less Than Fair Value and Final Negative 
Critical Circumstances: Carbon and Certain Alloy Steel Wire Rod from 
Brazil, 67 FR 55792, 55794-96 (Aug. 30, 2002). Adverse inferences are 
appropriate ``to ensure that the party does not obtain a more favorable 
result by failing to cooperate than if it had cooperated fully.'' See 
Statement of Administrative Action accompanying the Uruguay Round 
Agreements Act, H.R. Rep. No. 103-316, Vol. 1, at 870 (1994) (SAA), 
reprinted in 1994 U.S.C.C.A.N. 4040, 4198-99. Furthermore, 
``affirmative evidence of bad faith on the part of a respondent is not 
required before the Department may make an adverse inference.'' See 
Antidumping Duties; Countervailing Duties; Final Rule, 62 FR 27296, 
27340 (May 19, 1997); see also Nippon Steel Corp. v. United States, 337 
F.3d 1373, 1382-83 (Fed. Cir. 2003) (Nippon). We preliminarily find 
that Anglo-Siam Seafoods, Fortune Frozen Foods, Gallant Ocean, Li-Thai, 
Queen Marine Food, Smile Heart Foods, and Thai World did not act to the 
best of their abilities in this proceeding, within the meaning of 
section 776(b) of the Act, because they failed to respond to the 
Department's requests for information. Therefore, an adverse inference 
is warranted in selecting from the facts otherwise available with 
respect to these companies. See Nippon, 337 F.3d at 1382-83.
    Section 776(b) of the Act provides that the Department may use as 
AFA information derived from: (1) The petition; (2) the final 
determination in the investigation; (3) any previous review; or (4) any 
other information placed on the record.
    The Department's practice, when selecting an AFA rate from among 
the possible sources of information, has been to ensure that the margin 
is sufficiently adverse ``as to effectuate the statutory purposes of 
the adverse facts available rule to induce respondents to provide the 
Department with complete and accurate information in a timely manner.'' 
See, e.g., Certain Steel Concrete Reinforcing Bars from Turkey; Final 
Results and Rescission of Antidumping Duty Administrative Review in 
Part, 71 FR 65082, 65084 (Nov. 7, 2006).
    In order to ensure that the margin is sufficiently adverse so as to 
induce cooperation, we have preliminarily assigned a rate of 57.64 
percent, which is the highest rate alleged in the petition, as adjusted 
at the initiation of the less-than-fair-value (LTFV) investigation. See 
Notice of Initiation of Antidumping Duty Investigations: Certain Frozen 
and Canned Warmwater Shrimp From Brazil, Ecuador, India, Thailand, the 
People's Republic of China and the Socialist Republic of Vietnam, 69 FR 
3876, 3881 (Jan. 27, 2004). The Department finds that this rate is 
sufficiently high as to effectuate the purpose of the facts available 
rule (i.e., we find that this rate is high enough to encourage 
participation in future segments of this proceeding in accordance with 
section 776(b) of the Act).
    Information from prior segments of the proceeding constitutes 
secondary information and section 776(c) of the Act provides that the 
Department shall, to the extent practicable, corroborate that secondary 
information from independent sources reasonably at its disposal. The 
Department's regulations provide that ``corroborate'' means that the 
Department will satisfy itself that the secondary information to be 
used has probative value. See 19 CFR 351.308(d); see also SAA at 870. 
To the extent practicable, the Department will examine the reliability 
and relevance of the information to be used.
    To corroborate the petition margin, we compared it to the 
transaction-specific rates calculated for each respondent in this 
review. We find that it is reliable and relevant because the petition 
rate fell within the range of individual transaction margins calculated 
for the mandatory respondents. See Notice of Preliminary Results of 
Antidumping Duty Administrative Review; Partial Rescission and 
Postponement of Final Results: Certain Softwood Lumber Products from 
Canada, 71 FR 33964, 33968 (June 12, 2006). Therefore, we have 
determined that the 57.64 percent margin is appropriate as AFA and are 
assigning it to the uncooperative companies listed above.
    Further, the Department will consider information reasonably at its 
disposal as to whether there are circumstances that would render a 
margin inappropriate. Where circumstances indicate that the selected 
margin is not appropriate as AFA, the Department may disregard the 
margin and determine an appropriate margin. See, e.g., Fresh Cut 
Flowers from Mexico; Final Results of Antidumping Duty Administrative 
Review, 61 FR 6812, 6814 (Feb. 22, 1996) (where the Department 
disregarded the highest calculated margin as AFA because the margin was

[[Page 10674]]

based on a company's uncharacteristic business expense resulting in an 
unusually high margin). Therefore, we examined whether any information 
on the record would discredit the selected rate as reasonable facts 
available. We were unable to find any information that would discredit 
the selected AFA rate.
    Because we did not find evidence indicating that the selected 
margin is not appropriate and because this margin falls within the 
range of transaction-specific margins for the mandatory respondents, we 
have preliminarily determined that the 57.64 percent margin, as alleged 
in the petition and adjusted at the initiation of the LTFV 
investigation, is appropriate as AFA. We are assigning this rate to 
Anglo-Siam Seafoods, Fortune Frozen Foods, Gallant Ocean, Li-Thai, 
Queen Marine Food, Smile Heart Foods, and Thai World. For company-
specific information used to corroborate this rate, see the Memorandum 
to the File from Brianne Riker, Analyst, Office 2, AD/CVD Operations, 
entitled ``Corroboration of Adverse Facts Available Rate for the 
Preliminary Results in the 2004-2006 Antidumping Duty Administrative 
Review of Certain Frozen Warmwater Shrimp from Thailand,'' dated 
February 28, 2007.

Comparisons to Normal Value

    To determine whether sales of certain frozen warmwater shrimp from 
Thailand to the United States were made at less than NV, we compared 
the export price (EP) or constructed export price (CEP) to the NV, as 
described in the ``Constructed Export Price/Export Price'' and ``Normal 
Value'' sections of this notice.
    Pursuant to section 777A(d)(2) of the Act, for Good Luck Product 
and Pakfood, we compared the EPs of individual U.S. transactions to the 
weighted-average NV of the foreign like product where there were sales 
made in the ordinary course of trade, as discussed in the ``Cost of 
Production Analysis'' section below.
    Regarding Thai I-Mei, we have determined that this company did not 
have a viable home or third country market during the POR. Therefore, 
as the basis for NV, we used constructed value (CV) when making 
comparisons to CEP for Thai I-Mei in accordance with section 773(a)(4) 
of the Act.

 Product Comparisons

    In accordance with section 771(16) of the Act, we considered all 
products produced by Good Luck Product and Pakfood covered by the 
description in the ``Scope of the Order'' section, above, to be foreign 
like products for purposes of determining appropriate product 
comparisons to U.S. sales. Pursuant to 19 CFR 351.414(e)(2), we 
compared U.S. sales of shrimp to sales of shrimp made in the home 
market for Good Luck Product and Pakfood within the contemporaneous 
window period, which extends from three months prior to the month of 
the U.S. sale until two months after the sale. Where there were no 
sales of identical merchandise in the comparison market made in the 
ordinary course of trade to compare to U.S. sales, we compared U.S. 
sales of shrimp to sales of shrimp of the most similar foreign like 
product made in the ordinary course of trade. For Good Luck Product and 
Pakfood, where there were no sales of identical or similar merchandise, 
and for all Thai I-Mei sales, we made product comparisons using CV.
    With respect to sales comparisons involving broken shrimp, we 
compared Pakfood's sales of broken shrimp in the home market to its 
sales of comparable quality shrimp to the United States.
    In making the product comparisons, we matched foreign like products 
based on the physical characteristics reported by Good Luck Product and 
Pakfood in the following order: cooked form, head status, count size, 
organic certification, shell status, vein status, tail status, other 
shrimp preparation, frozen form, flavoring, container weight, 
presentation, species, and preservative.

Constructed Export Price/Export Price

    For all U.S. sales made by Good Luck Product and Pakfood we used EP 
methodology, in accordance with section 772(a) of the Act, because the 
subject merchandise was sold directly to the first unaffiliated 
purchaser in the United States prior to importation and CEP methodology 
was not otherwise warranted based on the facts of record.
    For U.S. sales made by Thai I-Mei, we calculated CEP in accordance 
with section 772(b) of the Act because the subject merchandise was sold 
for the account of Thai I-Mei by its subsidiary, Ocean Duke 
Corporation, in the United States to unaffiliated purchasers.

A. Good Luck Product

    We based EP on packed prices to the first unaffiliated purchaser in 
the United States. Where appropriate, we made adjustments for billing 
adjustments. We made deductions from the starting price for foreign 
inland freight expenses (i.e., freight from port to warehouse and 
freight from warehouse to the customer), foreign warehousing expenses, 
foreign brokerage and handling expenses, survey fees, and ocean freight 
expenses, where appropriate, in accordance with section 772(c)(2)(A) of 
the Act.

B. Pakfood

    We based EP on packed prices to the first unaffiliated purchaser in 
the United States. Where appropriate, we made adjustments for billing 
adjustments and discounts. We made deductions from the starting price 
for foreign inland freight expenses, foreign warehousing expenses, gate 
charges, survey fees, foreign brokerage and handling expenses, ocean 
freight expenses, U.S. brokerage expenses, and U.S. customs duties, 
where appropriate, in accordance with section 772(c)(2)(A) of the Act.
    Regarding warehousing expenses, Pakfood reported that certain of 
these services were provided by an affiliated party. At verification, 
we tested the warehousing expenses charged by the affiliated party to 
determine whether the prices charged were at ``arm's length.'' Where we 
found that the prices were not at arm's length, we adjusted them to be 
equivalent to the market price. For further discussion, see the 
Memorandum to the File from Irina Itkin and Brianne Riker entitled, 
``Verification of the Sales Response of Pakfood Public Company Limited 
in the Antidumping Duty Administrative Review on Certain Frozen 
Warmwater Shrimp from Thailand'' (``Pakfood Verification Report''), 
dated January 19, 2007.

C. Thai I-Mei

    In accordance with section 772(b) of the Act, we calculated CEP for 
those sales where the merchandise was first sold (or agreed to be sold) 
in the United States before or after the date of importation by or for 
the account of the producer or exporter, or by a seller affiliated with 
the producer or exporter, to a purchaser not affiliated with the 
producer or exporter. For Thai I-Mei's direct shipments, we used the 
earlier of shipment date from Thailand to the customer or the U.S. 
affiliate's invoice date as the date of sale, in accordance with our 
practice. See e.g., Notice of Final Determination of Sales at Less Than 
Fair Value and Negative Final Determination of Critical Circumstances: 
Certain Frozen and Canned Warmwater Shrimp From Thailand, 69 FR 76918 
(Dec. 23, 2004), and accompanying Issues and Decision Memorandum at 
Comment 10; Notice of Final Determination of Sales at Less Than Fair 
Value: Structural Steel Beams from Germany, 67 FR 35497 (May 20, 2002), 
and accompanying Issues and Decision Memorandum at Comment 2.

[[Page 10675]]

    We based CEP on the packed delivered prices to unaffiliated 
purchasers in the United States. Where appropriate, we made adjustments 
for billing adjustments. We made deductions from the starting price for 
foreign inland freight, foreign inland insurance, foreign brokerage and 
handling expenses, ocean freight expenses, marine insurance expenses, 
U.S. brokerage and handling, U.S. customs duties, U.S. inland 
insurance, U.S. inland freight expenses, and U.S. warehousing expenses, 
where appropriate, in accordance with section 772(c)(2)(A) of the Act. 
In accordance with section 772(d)(1) of the Act and 19 CFR 351.402(b), 
we deducted those selling expenses associated with economic activities 
occurring in the United States, including direct selling expenses 
(i.e., imputed credit expenses), and indirect selling expenses 
(including inventory carrying costs and other indirect selling 
expenses).
    Pursuant to section 772(d)(3) of the Act, we calculated an amount 
for profit to arrive at CEP. In accordance with section 
772(f)(2)(C)(iii) of the Act, we based the CEP profit rate on Thai I-
Mei's financial statements because Thai I-Mei made sales during the POR 
solely to the United States. For further discussion, see the Memorandum 
to the File from Alice Gibbons, Senior Analyst, Office 2, AD/CVD 
Operations, entitled, ``Calculations Performed for Thai I-Mei Frozen 
Foods Co., Ltd. for the Preliminary Results in the 2004-2006 
Antidumping Duty Administrative Review on Certain Frozen Warmwater 
Shrimp from Thailand,'' dated February 28, 2007.

Normal Value

A. Home Market Viability and Selection of Comparison Markets

    In order to determine whether there was a sufficient volume of 
sales in the home market to serve as a viable basis for calculating NV, 
we compared the volume of home market sales of the foreign like product 
to the volume of U.S. sales of the subject merchandise, in accordance 
with section 773(a)(1)(C) of the Act. Based on this comparison, we 
determined that Good Luck Product and Pakfood had viable home markets 
during the POR. Consequently, we based NV on home market sales for 
these respondents.
    However, the petitioner has argued throughout this review that a 
large portion of Pakfood's home market is not legitimate (therefore, 
making its home market not viable) because there is no significant 
market for frozen shrimp in Thailand. In response, Pakfood has argued 
that its reported home market sales are legitimate because they: (1) 
Were exclusively of foreign like product; (2) were for consumption in 
Thailand; and, (3) do not constitute a particular market situation. At 
verification we thoroughly examined this issue and confirmed Pakfood's 
assertions regarding its home market sales. For further discussion, see 
the ``Pakfood Verification Report.''
    Further, we determined that Thai I-Mei's aggregate volumes of home 
and third country market sales of the foreign like product were 
insufficient to permit a proper comparison with U.S. sales of the 
subject merchandise. Therefore, we used CV as the basis for calculating 
NV for Thai I-Mei, in accordance with section 773(a)(4) of the Act.

B. Affiliated-Party Transactions and Arm's-Length Test

    During the POR, Good Luck Product and Pakfood sold the foreign like 
product to affiliated customers. To test whether these sales were made 
at arm's-length prices, we compared, on a product-specific basis, the 
starting prices of sales to affiliated and unaffiliated customers, net 
of all discounts and rebates, movement charges, direct selling 
expenses, and packing expenses. Pursuant to 19 CFR 351.403(c) and in 
accordance with the Department's practice, where the price to the 
affiliated party was, on average, within a range of 98 to 102 percent 
of the price of the same or comparable merchandise sold to unaffiliated 
parties, we determined that sales made to the affiliated party were at 
arm's length. See Antidumping Proceedings: Affiliated Party Sales in 
the Ordinary Course of Trade, 67 FR 69186, 69187 (Nov. 15, 2002) 
(establishing that the overall ratio calculated for an affiliate must 
be between 98 percent and 102 percent in order for sales to be 
considered in the ordinary course of trade and used in the normal value 
calculation). Sales to affiliated customers in the comparison market 
that were not made at arm's-length prices were excluded from our 
analysis because we considered these sales to be outside the ordinary 
course of trade. See 19 CFR 351.102(b).

C. Level of Trade

    Section 773(a)(1)(B)(i) of the Act states that, to the extent 
practicable, the Department will calculate NV based on sales at the 
same level of trade (LOT) as the EP or CEP. Sales are made at different 
LOTs if they are made at different marketing stages (or their 
equivalent). See 19 CFR 351.412(c)(2). Substantial differences in 
selling activities are a necessary, but not sufficient, condition for 
determining that there is a difference in the stages of marketing. Id. 
See also Notice of Final Determination of Sales at Less Than Fair 
Value: Certain Cut-to-Length Carbon Steel Plate From South Africa, 62 
FR 61731, 61732 (Nov. 19, 1997) (Plate from South Africa). In order to 
determine whether the comparison sales were at different stages in the 
marketing process than the U.S. sales, we reviewed the distribution 
system in each market (i.e., the chain of distribution), including 
selling functions, class of customer (customer category), and the level 
of selling expenses for each type of sale.
    Pursuant to section 773(a)(1)(B)(i) of the Act, in identifying LOTs 
for EP and comparison market sales (i.e., NV based on either home 
market or third country prices),\12\ we consider the starting prices 
before any adjustments. For CEP sales, we consider only the selling 
activities reflected in the price after the deduction of expenses and 
profit under section 772(d) of the Act. See Micron Technology, Inc. v. 
United States, 243 F. 3d 1301, 1314 (Fed. Cir. 2001).
---------------------------------------------------------------------------

    \12\ Where NV is based on CV, we determine the NV LOT based on 
the LOT of the sales from which we derive selling expenses, general 
and administrative (G&A) expenses, and profit for CV, where 
possible.
---------------------------------------------------------------------------

    When the Department is unable to match U.S. sales of the foreign 
like product in the comparison market at the same LOT as the EP or CEP, 
the Department may compare the U.S. sale to sales at a different LOT in 
the comparison market. In comparing EP or CEP sales at a different LOT 
in the comparison market, where available data make it practicable, we 
make an LOT adjustment under section 773(a)(7)(A) of the Act. Finally, 
for CEP sales only, if the NV LOT is more remote from the factory than 
the CEP LOT and there is no basis for determining whether the 
difference in LOTs between NV and CEP affects price comparability 
(i.e., no LOT adjustment was practicable), the Department shall grant a 
CEP offset, as provided in section 773(a)(7)(B) of the Act. See Plate 
from South Africa, 62 FR at 61732-33.
    In this administrative review, we obtained information from each 
respondent regarding the marketing stages involved in making the 
reported foreign market and U.S. sales, including a description of the 
selling activities performed by each respondent for each channel of 
distribution. Company-specific LOT findings are summarized below.

[[Page 10676]]

1. Good Luck Product
    Good Luck Product reported that it made EP sales in the U.S. market 
through a single channel of distribution (i.e., spot sales). We 
examined the selling activities performed for this channel and found 
that Good Luck Product performed the following selling functions: sales 
forecasting, order input/processing, providing direct sales personnel, 
providing commission payments, claim services (i.e., billing 
adjustments), freight and delivery services, and packing. These selling 
activities can be generally grouped into four core selling function 
categories for analysis: (1) Sales and marketing; (2) freight and 
delivery; (3) inventory maintenance and warehousing; and, (4) warranty 
and technical support. Accordingly, based on the core selling 
functions, we find that Good Luck Product performed sales and 
marketing, freight and delivery services, inventory maintenance and 
warehousing, and warranty and technical services for U.S. sales. 
Because all sales in the United States are made through a single 
distribution channel, we preliminarily determine that there is one LOT 
in the U.S. market.
    With respect to the home market, Good Luck Product made sales 
through the following channels of distribution: (1) Spot sales; (2) 
sales to a Thai retailer; and, (3) sales through retail arrangements. 
Good Luck Product stated that its home market sales were made at the 
same LOT, regardless of distribution channel. We examined the selling 
activities performed for spot sales and found that Good Luck Product 
performed the following selling functions: order input/processing, 
providing direct sales personnel, providing commission payment, claim 
services (i.e., return service), and freight and delivery services. 
Regarding sales both to the Thai retailer and through retail 
arrangements, we find that Good Luck Product performed the following 
sales activities: sales forecasting, sales promotion/advertising/trade 
fairs, packing, providing retail displays/inventory maintenance, order 
input/processing, providing direct sales personnel, providing rebates, 
claim services (i.e., return service), and freight and delivery 
services. Accordingly, based on the core selling functions, we find 
that Good Luck Product performed sales and marketing, freight and 
delivery services, inventory maintenance and warehousing, and warranty 
and technical services in the home market. Although Good Luck Product 
performed additional sales and marketing functions for its sales both 
to the Thai retailer and through retail arrangements that it did not 
perform for its spot sales, we did not find these differences to be 
material selling function distinctions significant enough to warrant a 
separate LOT in the home market. Therefore, we preliminarily determine 
that there is one LOT in the home market because Good Luck Product 
performed essentially the same selling functions for all home market 
sales.
    Finally, we compared the EP LOT to the home market LOT and found 
that the core selling functions performed for U.S. and home market 
customers do not differ significantly. Therefore, we determined that 
sales to the U.S. and home markets during the POR were made at the same 
LOT, and as a result, no LOT adjustment was warranted.
2. Pakfood
    Pakfood reported that it made EP sales in the U.S. market through a 
single channel of distribution (i.e., direct sales to distributors). We 
examined the selling activities performed for this channel, and found 
that Pakfood performed the following selling functions: sales 
forecasting/market research, order processing, providing direct sales 
personnel, providing commission payments, sales promotion/trade shows/
advertising, customer contact, price negotiation, invoice issuance, 
payment receipt, delivery services, and packing. Accordingly, based on 
the core selling functions, we find that Pakfood performed sales and 
marketing, freight and delivery services, and inventory maintenance and 
warehousing for U.S. sales. Because all sales in the United States are 
made through a single distribution channel, we preliminarily determine 
that there is one LOT in the U.S. market.
    With respect to the home market, Pakfood made sales to 
distributors, retailers, and end-users. Pakfood stated that its home 
market sales were made through a single channel of distribution, 
regardless of customer category. We examined the selling activities 
performed for this channel, and found that Pakfood performed the 
following selling functions: sales forecasting/market research, sales 
promotion/trade shows/advertising, customer contact, price negotiation, 
order processing, invoice issuance, delivery services, providing direct 
sales personnel, payment receipt, and packing. Accordingly, based on 
the core selling functions, we find that Pakfood performed sales and 
marketing, freight and delivery services, and inventory maintenance and 
warehousing at the same relative level of intensity for all customers 
in the home market. Because all sales in the home market are made 
through a single distribution channel, we preliminarily determine that 
there is one LOT in the home market.
    Finally, we compared the EP LOT to the home market LOT and found 
that the core selling functions performed for U.S. and home market 
customers are virtually identical. Therefore, we determined that sales 
to the U.S. and home markets during the POR were made at the same LOT, 
and as a result, no LOT adjustment was warranted.
3. Thai I-Mei
    With respect to Thai I-Mei, this exporter had no viable home or 
third country market during the POR. Therefore, we based NV on CV. When 
NV is based on CV, the NV LOT is that of the sales from which we derive 
selling, general, and administrative (SG&A) expenses and profit. See 
Notice of Preliminary Determination of Sales at Less Than Fair Value 
and Postponement of Final Determination: Fresh Atlantic Salmon from 
Chile, 63 FR 2664 (Jan. 16, 1998), unchanged in Notice of Final 
Determination of Sales at Less Than Fair Value: Fresh Atlantic Salmon 
From Chile, 63 FR 31411 (June 9, 1998). In accordance with 19 CFR 
351.412(d), the Department will make its LOT determination under 
paragraph (d)(2) of this section on the basis of sales of the foreign 
like product by the producer or exporter. Because we based the selling 
expenses and profit for Thai I-Mei on the weighted-average selling 
expenses incurred and profits earned by the other respondents in the 
administrative review, we are able to determine the LOT of the sales 
from which we derived selling expenses and profit for CV.
    Thai I-Mei reported that it made sales through six channels of 
distribution in the United States; however, it stated that the selling 
activities it performed did not vary by channel of distribution. Thai 
I-Mei reported performing the following selling functions for sales to 
its U.S. affiliate: order input/processing, providing direct sales 
personnel, warranty service, freight and delivery services, and 
packing. Accordingly, based on the core selling functions, we find that 
Thai I-Mei performed sales and marketing, freight and delivery 
services, and warranty services for sales to its U.S. affiliate. 
Because Thai I-Mei's selling activities did not vary by distribution 
channel, we preliminarily determine that there is one LOT in the U.S. 
market.
    As noted above, we find that Good Luck Product and Pakfood 
performed the following core selling functions: sales and marketing, 
freight and

[[Page 10677]]

delivery services, inventory maintenance and warehousing, and warranty 
services. Further, although Good Luck Product and Pakfood performed 
certain sales and marketing functions (e.g., sales forecasting/market 
research, sales promotion/advertising/trade fairs, and retail displays) 
and inventory maintenance and warehousing functions that Thai I-Mei did 
not perform, we did not find these differences to be material selling 
function distinctions significant enough to warrant a separate LOT. 
Thus, we determine that the NV LOT for Thai I-Mei is the same as the 
LOT of Thai I-Mei's CEP sales. Because Good Luck Product and Pakfood 
only made sales at one LOT in their home markets, and there is no 
additional information on the record that would allow for an LOT 
adjustment, we determine that no LOT adjustment is warranted for Thai 
I-Mei.
    Regarding the CEP-offset provision, as described above, it is 
appropriate only if the NV LOT is more remote from the factory than the 
CEP LOT and there is no basis for determining whether the difference in 
LOTs between NV and CEP affects price comparability. Because we find 
that no difference in LOTs exists, we do not find that a CEP offset is 
warranted for Thai I-Mei.

D. Cost of Production Analysis

    Based on our analysis of the petitioner's allegations, we found 
that there were reasonable grounds to believe or suspect that Good Luck 
Product's and Pakfood's sales of frozen warmwater shrimp in the home 
market were made at prices below their cost of production (COP). 
Accordingly, pursuant to section 773(b) of the Act, we initiated sales-
below-cost investigations to determine whether Good Luck Product's and 
Pakfood's sales were made at prices below their respective COPs. See 
the Good Luck Product Cost Allegation and the Pakfood Cost Allegation.
1. Calculation of Cost of Production
    In accordance with section 773(b)(3) of the Act, we calculated the 
respondents' COPs based on the sum of their costs of materials and 
conversion for the foreign like product, plus amounts for G&A expenses 
and interest expenses (see ``Test of Comparison Market Sales Prices'' 
section below for treatment of home market selling expenses).
    The Department relied on the COP data submitted by each respondent 
in its most recent supplemental section D questionnaire response for 
the COP calculation, except for the following instances where the 
information was not appropriately quantified or valued:
    a. Good Luck Product
    1. We adjusted Good Luck Product's reported G&A expenses to exclude 
an offset claimed for trade fair income because the cost of the 
products sold was already deducted from the reported costs.
    2. We adjusted the cost of sales denominator used to calculate the 
G&A and financial expense ratios to deduct certain shrimp purchases 
that were erroneously double-booked by Good Luck Product and removed 
from the reported costs.
    3. Good Luck Product did not remove packing costs from the 
denominator used to calculate the G&A and financial expense ratios. 
Therefore, we applied these rates to the reported cost of 
manufacturing, including packing expenses.
    Our revisions to Good Luck Product's COP data are discussed in the 
Memorandum from Christopher Zimpo, Accountant, to Neal Halper, 
Director, Office of Accounting, entitled ``Cost of Production and 
Constructed Value Calculation Adjustments for the Preliminary Results--
Good Luck Product Co., Ltd.,'' dated February 28, 2007.
    b. Pakfood
    1. We adjusted the G&A expense ratios for Pakfood and its 
affiliates Asia Pacific (Thailand) Company Limited and Takzin Samut 
Company Limited to include a portion of the affiliate Okeanos Company 
Limited's administrative expenses.
    2. We adjusted Pakfood's G&A expense ratio to: (1) Exclude the 
offset for the gain on the sale of marketable securities; and, (2) 
include the G&A expenses and cost of sales of an affiliated producer in 
the numerator and denominator. In addition, we excluded an offset to 
Pakfood's G&A expenses for rental income received from an affiliated 
producer.
    3. Because Pakfood had net financial income, we did not include an 
amount for financial expense for COP. This is in accordance with the 
Department's practice of determining that, when a company earns enough 
financial income that it recovers all of its financial expense, that 
company did not have a resulting cost for financing during that period. 
See Certain Steel Concrete Reinforcing Bars from Turkey; Preliminary 
Results and Partial Rescission of Antidumping Duty Administrative 
Review, 71 FR 26455, 26460 (May 5, 2006); Notice of Final Results of 
Antidumping Duty Administrative Review: Certain Softwood Lumber 
Products From Canada, 70 FR 73437 (Dec. 12, 2005), and accompanying 
Issues and Decision Memorandum at Comments 9 and 25.
    Our revisions to Pakfood's COP data are discussed in the Memorandum 
from Ernest Gziryan, Accountant, to Neal Halper, Director, Office of 
Accounting, entitled ``Cost and Constructed Value Calculation 
Memorandum for the Preliminary Results--Pakfood Public Company 
Limited,'' dated February 28, 2007.
2. Test of Comparison Market Sales Prices
    On a product-specific basis, we compared the adjusted weighted-
average COP to the home market sales of the foreign like product, as 
required under section 773(b) of the Act, in order to determine whether 
the sale prices were below the COP. For purposes of this comparison, we 
used COP exclusive of selling and packing expenses. The prices 
(inclusive of billing adjustments, where appropriate) were exclusive of 
any applicable movement charges, rebates, discounts, and direct and 
indirect selling expenses, and packing expenses, revised where 
appropriate, as discussed below under the ``Price-to-Price 
Comparisons'' section.
3. Results of the COP Test
    Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 20 
percent of a respondent's sales of a given product were at prices less 
than the COP, we did not disregard any below-cost sales of that product 
because we determined that the below-cost sales were not made in 
``substantial quantities.'' Where 20 percent or more of a respondent's 
sales of a given product during the POR were at prices less than COP, 
we determined that such sales have been made in ``substantial 
quantities.'' See section 773(b)(2)(C) of the Act. Further, the sales 
were made within an extended period of time, in accordance with section 
773(b)(2)(B) of the Act, because we examined below-cost sales occurring 
during the entire POR. In such cases, because we compared prices to 
POR-average costs, we also determined that such sales were not made at 
prices which would permit recovery of all costs within a reasonable 
period of time, in accordance with section 773(b)(2)(D) of the Act.
    We found that, for certain specific products, more than 20 percent 
of Good Luck Product's and Pakfood's sales were at prices less than the 
COP and, in addition, such sales did not provide for the recovery of 
costs within a reasonable period of time. We therefore excluded these 
sales and used the remaining sales as the basis for determining NV, in

[[Page 10678]]

accordance with section 773(b)(1) of the Act.
    For those U.S. sales of subject merchandise for which there were no 
useable home market sales in the ordinary course of trade, we compared 
EPs to CV in accordance with section 773(a)(4) of the Act. See 
``Calculation of Normal Value Based on Constructed Value'' section 
below.

E. Calculation of Normal Value Based on Comparison Market Prices

1. Good Luck Product
    We based NV for Good Luck Product on delivered prices to 
unaffiliated customers in the home market or prices to affiliated 
customers in the home market that were determined to be at arm's 
length. We made adjustments, where appropriate, to the starting price 
for discounts and rebates. We made deductions, where appropriate, from 
the starting price for inland freight expenses and warehousing 
expenses, under section 773(a)(6)(B)(ii) of the Act.
    We made adjustments for differences in costs attributable to 
differences in the physical characteristics of the merchandise in 
accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. 
In addition, we made adjustments under section 773(a)(6)(C)(iii) of the 
Act and 19 CFR 351.410 for differences in circumstances of sale for 
imputed credit expenses and bank charges.
    Regarding credit expenses, Good Luck Product reported that it had 
not received full payment for certain home market and U.S. sales. 
Consequently, for the unpaid portion of these sales, we used a payment 
date of February 28, 2007 (i.e., the date of the preliminary results), 
and recalculated imputed credit expenses accordingly.
    We also made adjustments in accordance with 19 CFR 351.410(e) for 
indirect selling expenses incurred on comparison-market or U.S. sales 
where commissions were granted on sales in one market but not the 
other. Specifically, where commissions were granted in the U.S. market 
but not in the comparison market, we made a downward adjustment to NV 
for the lesser of: (1) The amount of commission paid in the U.S. 
market; or, (2) the amount of indirect selling expenses incurred in the 
comparison market. If commissions were granted in the comparison market 
but not in the U.S. market, we made an upward adjustment to NV 
following the same methodology.
    Finally, we deducted home market packing costs and added U.S. 
packing costs, in accordance with sections 773(a)(6)(A) and (B) of the 
Act.
2. Pakfood
    We based NV for Pakfood on ex-factory or delivered prices to 
unaffiliated customers in the home market or prices to affiliated 
customers in the home market that were determined to be at arm's 
length. We made deductions, where appropriate, from the starting price 
for inland freight and warehousing expenses, under section 
773(a)(6)(B)(ii) of the Act.
    Regarding warehousing expenses, Pakfood reported that certain of 
these services were provided by an affiliated party. At verification, 
we tested the warehousing expenses charged by the affiliated party to 
determine whether the prices charged were at ``arm's length.'' Where we 
found that the prices were not at arm's length, we adjusted them to be 
equivalent to the market price. For further discussion, see the 
``Pakfood Verification Report.''
    We made adjustments for differences in costs attributable to 
differences in the physical characteristics of the merchandise in 
accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. 
In addition, we made adjustments under section 773(a)(6)(C)(iii) of the 
Act and 19 CFR 351.410 for differences in circ