Canned Pineapple Fruit from Thailand: Preliminary Results of Antidumping Duty Administrative Review, 44490-44495 [E7-15489]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 72, Number 152 (Wednesday, August 8, 2007)]
[Notices]
[Pages 44490-44495]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-15489]


-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

International Trade Administration

[A-549-813]


Canned Pineapple Fruit from Thailand: Preliminary Results of 
Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: In response to timely requests, the Department of Commerce 
(the Department) is conducting an administrative review of the 
antidumping duty order on canned pineapple fruit (CPF) from Thailand 
for the period of review (POR) July 1, 2005 through June 30, 2006. The 
review covers two respondents, Vita Food Factory (1989) Ltd. (Vita) and 
Tropical Food Industries Co. Ltd. (Trofco). The domestic interested 
party for this proceeding is Maui Pineapple Company Ltd. (petitioner).
    The Department preliminarily determines that Vita and Trofco made 
sales to the United States at less than normal value (NV). If these 
preliminary results are adopted in the final results of this 
administrative review, we will instruct U.S. Customs and Border 
Protection (CBP) to assess antidumping duties on entries of Vita's and 
Trofco's merchandise during the POR. The preliminary results are listed 
below in the section titled ``Preliminary Results of Review.''

EFFECTIVE DATE:  August 8, 2007.

FOR FURTHER INFORMATION CONTACT: Myrna Lobo or Douglas Kirby, AD/CVD 
Operations, Office 6, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
2371 or (202) 482-3782, respectively.

SUPPLEMENTARY INFORMATION:

Background

    The Department published the antidumping duty order on CPF from 
Thailand on July 18, 1995. See Notice of Antidumping Duty Order and 
Amended Final Determination: Canned Pineapple Fruit from Thailand, 60 
FR 36775 (July 18, 1995) (Antidumping Duty Order). On July 3, 2006, the 
Department published in the Federal Register a notice of ``Opportunity 
to Request Administrative Review'' of the antidumping duty order on CPF 
from Thailand. See Antidumping or Countervailing Duty Order, Finding, 
or Suspended Investigation; Opportunity to Request Administrative 
Review, 71 FR 37890 (July 3, 2006).
    The Department received a request for review from Vita, by the July 
31, 2006 deadline and therefore, on August 30, 2006, the Department 
published in the Federal Register the notice of initiation of the 
administrative review of the antidumping duty order on CPF from 
Thailand for Vita. See Initiation of Antidumping and Countervailing 
Duty Administrative Reviews and Requests for Revocation in Part, 71 FR 
51573 (August 30, 2006).
    Trofco also submitted a request for review, but Trofco's review 
request was not received by the Department until after the deadline for 
requesting an administrative review. However, the record of this 
proceeding shows that if not for an error by the express delivery 
service, Trofco's review request would have been received by the 
Department on or before the July 31, 2006 deadline. Therefore, on 
October 10, 2006 the Department initiated a review for Trofco. For 
further discussion on this issue, see Initiation of Antidumping Duty 
Administrative Review: Canned Pineapple Fruit from Thailand, 71 FR 
59430 (October 10, 2006).
    On August 14, 2006, the Department issued sections A through E of 
the questionnaire to Vita.\1\ Vita submitted its section A response on 
September 12, 2006, and submitted its sections B through D response on 
September 27, 2006. The Department issued a sections A through D 
supplemental questionnaire on February 6, 2007, and Vita responded on 
February 20, 2007. On April 13, 2007, the Department issued a second 
sections A through D supplemental questionnaire to Vita; Vita responded 
on April 25, 2007. Finally, on May 18, 2007, the Department issued a 
third sections A through D supplemental questionnaire to Vita, and Vita 
responded on May 30, 2007.
---------------------------------------------------------------------------

    \1\ Section A of the questionnaire requests general information 
concerning a company's corporate structure and business practices, 
the merchandise under investigation that it sells, and the manner in 
which it sells that merchandise in all of its markets. Section B 
requests a complete listing of all home market sales, or, if the 
home market is not viable, of sales in the most appropriate third-
country market (this section is not applicable to respondents in 
non-market economy cases). Section C requests a complete listing of 
U.S. sales. Section D requests information on the cost of production 
of the foreign like product and the constructed value of the 
merchandise under investigation. Section E requests information on 
further manufacturing.
---------------------------------------------------------------------------

    On October 12, 2006, the Department issued sections A through E of 
the questionnaire to Trofco. Trofco submitted its section A 
questionnaire response on October 17, 2006, and submitted its responses 
to sections B and C on November 15, 2006. The Department issued a 
sections A through C supplemental questionnaire on

[[Page 44491]]

January 29, 2007, and Trofco responded on February 12, 2007. On May 18, 
2007 the Department issued a second sections A through C supplemental 
questionnaire and Trofco responded on May 24, 2007.
    On November 27, 2006 the petitioner filed an allegation of sales 
below the cost of production for Trofco. On December 14, 2006 the 
Department initiated a cost investigation. Trofco submitted its section 
D response on December 28, 2006. See ``Cost of Production Analysis'' 
infra for further discussion. On January 31, 2006, the Department 
issued a section D supplemental questionnaire to Trofco. Trofco 
responded on February 20, 2007. On March 26, 2007 the Department issued 
a second section D supplemental questionnaire, and Trofco responded on 
April 4, 2007. A third and fourth section D supplemental questionnaire 
were issued on May 2 and May 16, 2007, respectively, and Trofco 
submitted its responses on May 10 and May 22, 2007.
    On November 15, 2006, the petitioner submitted deficiency comments 
on sections A through D of Vita's questionnaire responses. On November 
21, 2006, the petitioner submitted deficiency comments on Trofco's 
section A questionnaire response. On January 18, 2007, and April 12, 
2007, respectively, the petitioner submitted deficiency comments and a 
rebuttal to Trofco's section D questionnaire responses. See Cost of 
Production Analysis infra for further discussion.
    On March 30, 2007, the Department, in accordance with section 
751(a)(3)(A) of the Tariff Act of 1930, as amended (the Act), and 19 
CFR 351.213(h)(2), extended the deadline for the preliminary results of 
this antidumping duty administrative review by 120 days from April 2, 
2007 until no later than July 31, 2007. See Canned Pineapple Fruit from 
Thailand: Extension of Time Limit for Preliminary Results of 
Antidumping Duty Administrative Review, 72 FR 15101 (March 30, 2007).

Verification

    On March 27, 2007, the petitioner submitted a timely letter 
requesting that the Department conduct verification of Vita's and 
Trofco's questionnaire responses pursuant to section 782(i)(3)(A) of 
the Act. The Department intends to conduct a sales and cost 
verification of Vita and a sales verification of Trofco following the 
preliminary results of this review. From June 20 through June 26, 2007, 
the Department conducted a cost verification of Trofco. For the results 
and analysis of Trofco's cost verification, see Memorandum from Ernest 
Z. Gziryan, Senior Accountant to Neal M. Halper, Director, Office of 
Accounting, Verification of the Cost of Production and Constructed 
Value Data Submitted by Tropical Food Industries Co. Ltd. in the 
Antidumping Duty Administrative Review of Canned Pineapple Fruit from 
Thailand (Trofco Cost Verification Report) (July 31, 2007) on file in 
room B-099, the Central Records Unit of the main Commerce building 
(CRU).

Period of Review

    This review covers the period July 1, 2005 through June 30, 2006.

Scope of the Order

    The product covered by this order is CPF, defined as pineapple 
processed and/or prepared into various product forms, including rings, 
pieces, chunks, tidbits, and crushed pineapple, that is packed and 
cooked in metal cans with either pineapple juice or sugar syrup added. 
CPF is currently classifiable under subheadings 2008.20.0010 and 
2008.20.0090 of the Harmonized Tariff Schedule of the United States 
(``HTSUS''). HTSUS 2008.20.0010 covers CPF packed in a sugar-based 
syrup; HTSUS 2008.20.0090 covers CPF packed without added sugar (i.e., 
juice-packed). Although these HTSUS subheadings are provided for 
convenience and for customs purposes, the written description of the 
scope is dispositive. There have been no scope rulings for the subject 
order.

Less than Fair Value Analysis

    To determine whether sales of subject merchandise to the United 
States were made at less than NV, we compared the export price (EP) to 
NV, as described in the ``U.S. Price'' and ``Normal Value'' sections of 
this notice in accordance with section 777A(d)(2) of the Act.

Product Comparisons

    In accordance with section 771(16)(A) of the Act, we considered all 
products produced by respondents that are covered by the description in 
the ``Scope of the Order'' section, above, and that were sold in the 
comparison market during the POR, to be foreign like products for 
purposes of determining appropriate product comparisons to U.S. sales. 
In accordance with sections 771(16)(B) and (C) of the Act, where there 
were no sales of identical merchandise in the comparison market to 
compare to U.S. sales, we compared U.S. sales to the most similar 
foreign like product on the basis of the characteristics listed in 
Appendix V of the Department's antidumping questionnaires.

Date of Sale

    It is the Department's practice to use invoice date as the date of 
sale. However, 19 CFR 351.401(i) states that the Secretary may use a 
date other than the invoice date if the Secretary is satisfied that the 
material terms of the sale were established on some other date. See 
Allied Tube and Conduit Corp. v. United States, 127 F. Supp. 2d 207, 
217-219 (CIT 2000). Both Vita and Trofco reported invoice date as the 
date of sale for all sales in both the comparison and U.S. markets. 
After analyzing the responses of both parties and the sample sales 
documents provided, we preliminarily determine that invoice date is the 
appropriate date of sale for all sales under review.

U.S. Price

    In accordance with section 772(a) of the Act, we use EP when the 
subject merchandise was first sold (or agreed to be sold) before the 
date of importation by the producer or exporter of the subject 
merchandise outside of the United States to an unaffiliated purchaser 
in the United States or to an unaffiliated purchaser for exportation to 
the United States, and constructed export price (CEP) was not otherwise 
warranted by the facts on the record. As discussed below, we conclude 
that all of Vita's and Trofco's U.S. sales are EP sales.
    Vita: Vita identified all of its U.S. sales as EP sales in its 
questionnaire responses. The Department based the price of each of 
Vita's U.S. sales of subject merchandise on EP, as defined in section 
772(a) of the Act, because the merchandise was sold, prior to 
importation, to unaffiliated purchasers in the United States, or to 
unaffiliated purchasers for exportation to the United States and the 
use of CEP was not otherwise warranted based on the facts on the 
record. In accordance with section 772 (a) and (c) of the Act, we 
calculated EP using the prices Vita charged for packed subject 
merchandise shipped FOB. We made deductions for movement expenses, 
including, where applicable, charges for transportation, terminal 
handling, container stuffing, bill of lading preparation, customs 
clearance, and legal and port fees documentation. See Analysis 
Memorandum for Vita Food Factory (1989) Co., Ltd., (Vita Preliminary 
Analysis Memorandum) dated concurrently with this notice. Vita reported 
post-sale, post-POR price adjustments in its September 12, 2006, 
section A questionnaire response. In addition, Vita explained that the 
company did not revise its sales

[[Page 44492]]

contracts and other related sales documents for these reported post-
sale billing adjustments. The Department asked in a supplemental 
questionnaire to Vita why no revisions to the sales documentation were 
made for the reported post-sale billing adjustments. Vita explained 
that it is its normal practice to make post-sale billing adjustments 
through discussions by telephone with its customers without revisions 
to sales documentation. See Vita 1st Supplemental Questionnaire at 9. 
Because Vita was unable to provide any documentation demonstrating that 
there were actual price adjustments, we did not make any adjustments to 
EP for these claimed post-sale price adjustments. See Corus Engineering 
Steels Ltd. v. United States, (Slip Op. 2003-110, 2003 CIT Lexis 110) 
(CIT August 27, 2003) at 11 (``The burden of proof is upon the claimant 
to prove entitlement.''). Moreover, Vita reported similar post-sale 
billing adjustments in the most recent review and the Department did 
not include these adjustments in the calculation of EP. See Canned 
Pineapple Fruit from Thailand: Preliminary Results of Antidumping Duty 
Administrative Review (10th Review Preliminary Results) 71 FR 44256, 
44258 (August 4, 2006), unchanged in Canned Pineapple Fruit from 
Thailand: Final Results and Partial Rescission of Antidumping Duty 
Administrative Review, (10th Review Final Results) 71 FR 70948 
(December 7, 2006) and accompanying Issues and Decision Memorandum at 
Comment 1.
    Trofco: Trofco identified all of its U.S. sales as EP sales in its 
questionnaire responses. The Department based the price of each of 
Trofco's U.S. sales of subject merchandise on EP, as defined in section 
772(a) of the Act, because the merchandise was sold, prior to 
importation, to unaffiliated purchasers in the United States, or to 
unaffiliated purchasers for exportation to the United States and the 
use of CEP was not otherwise warranted based on the facts on the 
record. In accordance with sections 772 (a) and (c) of the Act, we 
calculated EP using the prices Trofco charged for packed subject 
merchandise shipped FOB, from which we made deductions for movement 
expenses, including, where applicable, charges for transportation, 
terminal handling, container stuffing, bill of lading preparation, 
Customs clearance, and legal and port fees documentation. See Analysis 
Memorandum for Tropical Food Industries Co, Ltd., (Trofco Preliminary 
Analysis Memorandum) dated concurrently with this notice.

Normal Value

    In accordance with section 773(a)(1)(B)(i) of the Act, we have 
based NV on the price at which the foreign like product was first sold 
for consumption in the comparison market, in the usual commercial 
quantities, in the ordinary course of trade, and, to the extent 
practicable, at the same level of trade (LOT) as the EP sale. See 
``Level of Trade'' section below. After testing comparison market 
viability and whether comparison market sales were at below-cost 
prices, we calculated NV for Vita and Trofco as discussed in the 
following sections.

Home Market Viability

    In accordance with section 773(a)(1)(C) of the Act, 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 (i.e., the 
aggregate volume of home market sales of the foreign like product 
normally should be greater than or equal to five percent of the 
aggregate volume of U.S. sales), we compared the aggregate volume of 
home market sales of the foreign like product to the aggregate volume 
of its U.S. sales of subject merchandise. See also 19 CFR 351.404(b).
    Vita: Because the aggregate volume of Vita's home market sales of 
foreign like product is less than five percent of the aggregate volume 
of its U.S. sales of subject merchandise, we based NV on sales of the 
foreign like product in a country other than Vita's home market. See 
section 773(a)(1)(B)(ii) of the Act. Specifically, we based NV for Vita 
on sales of the foreign like product in Germany. The Department 
selected Germany because sales to Vita's largest third-country market 
(the Netherlands) were largely trans-shipments to ultimate customers 
located in Germany. In addition, the product similarity for CPF sold to 
Germany and to the U.S. was superior vis-a-vis the product similarity 
for the Netherlands and the United States. See ``Cost of Production 
Analysis'' infra for further discussion.
    Trofco: Trofco's home market sales were greater than five percent 
as compared to the aggregate volume of U.S. sales during the POR. 
Therefore, Trofco's volume of sales in the home market during the POR 
was sufficient to serve as a viable basis for calculating NV.

Cost of Production (COP) Analysis

    Vita: In the most recently completed administrative review of the 
antidumping duty order on CPF from Thailand, the Department determined 
that Vita sold foreign-like product in its comparison market at prices 
below the cost of producing the product and excluded such sales from 
the calculation of NV. See 10th Review Preliminary Results and 10th 
Review Final Results. Therefore, in accordance with section 
773(b)(2)(A)(ii) of the Act, the Department determined that there are 
reasonable grounds to believe or suspect that during the current POR, 
Vita sold the foreign like product at prices below the cost of 
producing the product and instituted a below cost inquiry as to Vita's 
sales in the comparison market.\2\ Compare Top-of-the-Stove Stainless 
Steel Cooking Ware From the Republic of Korea: Preliminary Results and 
Rescission, in Part, of Antidumping Duty Administrative Review, 67 FR 
62951, 62954 (October 9, 2002) (unchanged in final results 68 FR 7503 ) 
with Top-of-the-Stove Stainless Steel Cooking Ware From Korea: 
Preliminary Results and Rescission, in Part, of Antidumping Duty 
Administrative Review, 66 FR 11259, 11263-64 (February 23, 2001) 
(unchanged in final results 66 FR 45664 ) for an example where the 
Department instituted a below cost inquiry under section 
773(b)(2)(A)(ii) of the Act based on a below cost finding in the most 
recently completed administrative review and the recently completed 
administrative review was based on a different comparison market than 
the on-going administrative review.
---------------------------------------------------------------------------

    \2\ In addition, the Department notes that on May 15, 2007, 
petitioner submitted a request that a cost investigation be 
initiated by the Department with respect to sales of CPF by Vita to 
Germany during the POR.
---------------------------------------------------------------------------

    Trofco: On November 27, 2007, petitioner alleged that Trofco made 
home market sales of CPF at prices below the cost of production during 
the POR. The Department found a reasonable basis to believe or suspect 
that Trofco's sales in Thailand were at prices below the COP and 
accordingly initiated a cost investigation for the current review. See 
Memorandum to Barbara E. Tillman, Director, AD/CVD Operations, Office 
6, from The Team on Petitioner's Allegation of Sales Below the Cost of 
Production for Tropical Food Industries Co., Ltd, (December 14, 2006). 
We relied on the COP data submitted by Trofco in its cost questionnaire 
responses with the following exceptions: (1) We revised the reported 
net realizable values (``NRV'') which Trofco used to allocate pineapple 
fruit cost to pineapple solid and pineapple juice products to account 
for the separately identifiable costs incurred to produce each product; 
(2) we revised

[[Page 44493]]

the reported financial expense rate to include the net foreign exchange 
gains and losses; and (3) we adjusted the cost of sales denominator 
used to calculate the general and administrative and financial expense 
rates to remove packing expenses. Our revisions to Trofco's COP data 
are discussed in the Memorandum from Ernest Z. Gziryan, Senior 
Accountant, to Neal M. Halper, Director, Office of Accounting, entitled 
``Cost of Production and Constructed Value Calculation Adjustments for 
the Preliminary Results,'' dated concurrently with this notice.

Test of Comparison Market Sales Prices

    We compared sales of the foreign like product in the home market 
with model-specific COP figures in the POR. In accordance with section 
773(b)(3) of the Act, we calculated COP based on the sum of the costs 
of materials and fabrication employed in producing the foreign like 
product, plus selling, general and administrative (SG&A) expenses, and 
financial expenses and packing. In our sales-below-cost analysis, we 
used comparison market sales and COP information provided by Vita and 
Trofco in their questionnaire responses. See Vita's September 27, 2006 
section D questionnaire response; see also Trofco's December 28, 2007 
section D questionnaire response.

Results of COP Test

    We compared the weighted-average COPs to comparison market sales of 
the foreign-like product, consistent with section 773(b) of the Act, in 
order to determine whether these sales had been made at prices below 
the COP. See also 19 CFR 351.404(b). In determining whether to 
disregard comparison market sales made at prices below the COP, we 
examined whether such sales were made (1) Within an extended period of 
time in substantial quantities, and (2) at prices which permitted the 
recovery of all costs within a reasonable period of time in the normal 
course of trade, in accordance with sections 773(b)(1)(A) and (B) of 
the Act.\3\ On a product-specific basis, we compared the COP to 
comparison market prices, less any movement charges, discounts and 
rebates, and direct and indirect selling expenses. See Treatment of 
Adjustments and Selling Expenses in Calculating the Cost of Production 
(``COP'') and Constructed Value (``CV'') Import Policy Bulletin (March 
25, 1994) on file in the CRU, which can also be accessed directly on 
the Web at https://ia.ita.doc.gov.
---------------------------------------------------------------------------

    \3\ Section 773(b)(2)(ii)(B-C) of the Act defines extended 
period of time as a period that is normally 1 year, but not less 
than 6 months, and substantial quantities as sales made at prices 
below the cost of production that have been made in substantial 
quantities if (i) The volume of such sales represents 20 percent or 
more of the volume of sales under consideration for the 
determination of normal value, or (ii) the weighted average per unit 
price of the sales under consideration for the determination of 
normal value is less than the weighted average per unit cost of 
production for such sales.
---------------------------------------------------------------------------

    Pursuant to section 773(b)(2)(C) of the Act, where less than 20 
percent of a respondent's sales of a given model were at prices less 
than the COP, we did not disregard any below-cost sales of that model 
because the below-cost sales were not made in substantial quantities 
within an extended period of time. Where 20 percent or more of a 
respondent's sales of a given model were at prices less than the COP, 
we disregarded the below-cost sales when: (1) They were made in 
substantial quantities within an extended period of time, in accordance 
with sections 773(b)(2)(B) and (C) of the Act and; (2) based on our 
comparison of prices to average COPs in the POR, we determined that the 
below-cost prices would not permit the recovery of costs within a 
reasonable period of time, in accordance with section 773(b)(2)(D) of 
the Act.

Price-to-Price Comparisons

    For those product comparisons for which there were comparison 
market sales of like product in the ordinary course of trade, we based 
NV on comparison market prices to affiliated (when made at prices 
determined to be arms-length) or unaffiliated parties, in accordance 
with section 773(a)(1)(A) and (B) of the Act. We made adjustments for 
differences in cost attributable to differences in physical 
characteristics of the merchandise, pursuant to section 
773(a)(6)(C)(ii) of the Act and 19 CRF 351.411 as well as for 
differences in direct selling expenses, in accordance with 
773(a)(6)(C)(iii) of the Act and 19 CFR 351.410. We relied on our model 
match criteria in order to match U.S. sales of subject merchandise to 
comparison sales of the foreign like product based on the reported 
physical characteristics of the subject merchandise. Where there were 
no sales of identical merchandise in the comparison market to compare 
to U.S. sales, we compared U.S. sales to the next most similar foreign 
like product on the basis of the characteristics and reporting 
instructions listed in the Department's questionnaire. See section 
771(16) of the Act.
    Vita: When comparing Vita comparison market sales to its EP sales, 
the Department calculated Vita's NV (shipped FOB, CNF or FAS) NV based 
on its gross unit price in Germany to unaffiliated customers. Pursuant 
to section 773(a)(6)(B)(ii) of the Act, we made deductions for movement 
expenses (i.e., inland freight, ocean freight and warehousing), when 
appropriate. In accordance with sections 773(a)(6)(A) and (B) of the 
Act, we deducted comparison market packing costs and added U.S. packing 
costs. In accordance with section 773(a)(6)(C)(iii) of the Act and 19 
CFR 351.410(c), we deducted comparison market direct selling expenses 
(i.e., credit, warranty) and added U.S. direct selling expenses. We 
made the appropriate adjustment for commissions paid in the home market 
pursuant to 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410(c). We 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 in the other, the 
``commission offset.'' Specifically, where commissions are incurred in 
one market, but not in the other, we will limit the amount of such 
allowance to the amount of either the selling expenses incurred in the 
one market or the commissions allowed in the other market, whichever is 
less.
    Trofco: The Department calculated Trofco's NV based on its gross 
unit price to unaffiliated customers less billing adjustments pursuant 
to section 773(a)(1)(A) of the Act. Pursuant to section 
773(a)(6)(B)(ii) of the Act, we made deductions for movement expenses 
(i.e., inland freight and warehousing), when appropriate. In accordance 
with sections 773(a)(6)(A) and (B) of the Act, we deducted comparison 
market packing costs and added U.S. packing costs. In accordance with 
section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410(c), we deducted 
comparison market direct selling expenses (i.e., credit) and added U.S. 
direct selling expenses. We made the appropriate adjustment for 
commissions paid in the home market pursuant to 773(a)(6)(C)(iii) of 
the Act and19 CFR 351.410(c). We 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 in the other, the ``commission offset.'' Specifically, 
where commissions are incurred in one market, but not in the other, we 
will limit the amount of such allowance to the amount of either the 
selling expenses incurred in the one market or the commissions allowed 
in the other market, whichever is less.

[[Page 44494]]

Price to Constructed Value Comparisons

    In accordance with section 773(a)(4) of the Act, we used 
constructed value (CV) as the basis for NV when we could not determine 
NV because there were no above-cost contemporaneous sales of identical 
or similar merchandise in the comparison market. We calculated CV in 
accordance with section 773(e) of the Act, including the cost of 
materials and fabrication, SG&A expenses, and profit. In accordance 
with section 773(e)(2)(A) of the Act, we based SG&A expenses and profit 
on the amounts incurred and realized by the respondent in connection 
with the production and sale of the foreign like product in the 
ordinary course of trade for consumption in the comparison market. 
Where NV is based on CV, we determine the NV LOT based on the LOT of 
the sales from which we derive selling expenses, SG&A expenses, and 
profit for CV, where possible.
    Vita: We used CV as the basis for NV for sales in which there were 
no usable contemporaneous sales of the foreign like product in the 
comparison market, in accordance with section 773(a)(4) of the Act. We 
calculated CV in accordance with section 773(e) of the Act. We added 
reported materials, labor, and factory overhead costs to derive the 
cost of manufacture (COM), in accordance with section 773(e)(1) of the 
Act. We then added interest expenses, SG&A expenses, profit, and U.S. 
packing expenses to derive the CV (and added U.S. credit expenses for 
comparison to EP), in accordance with sections 773(e)(2) and (3) of the 
Act. We calculated profit based on the total value of sales and total 
COP reported by Vita in its questionnaire response, in accordance with 
section 773(e)(2)(A) of the Act. Finally, we deducted comparison market 
credit expenses from CV and added U.S. credit to calculate the foreign 
unit price in dollars (FUPDOL), pursuant to section 773(e)(2)(A) of the 
Act.
    Trofco: We used CV as the basis for NV for sales in which there 
were no usable contemporaneous sales of the foreign like product in the 
comparison market, in accordance with section 773(a)(4) of the Act. We 
calculated CV in accordance with section 773(e) of the Act. We added 
reported materials, labor, and factory overhead costs, adjusted as 
shown in the COP Analysis section above, to derive the cost of 
manufacture (COM), in accordance with section 773(e)(1) of the Act. We 
then added interest expenses adjusted as shown in the COP Analysis 
section above, SG&A expenses adjusted as shown in the COP Analysis 
section above, profit, and U.S. packing expenses to derive the CV, in 
accordance with sections 773(e)(2) and (3) of the Act.
    Based on the information currently on the record, all of Trofco's 
sales in Thailand failed the COP test and therefore were outside the 
ordinary course of trade; hence, we cannot determine selling expenses 
or profit under section 773(e)(2)(A) of the Act. Section 773(e)(2)(B) 
of the Act sets forth three alternatives: (i) Selling expense and 
profit may be calculated based on ``actual amounts incurred by the 
specific exporter or producer of merchandise in the same general 
category'' as subject merchandise; (ii) may be calculated based on 
``the weighted average of the actual amounts incurred and realized by 
{other{time}  exporters or producers that are subject to the 
investigation''; or (iii) ``any other reasonable method,'' with limits 
on the ``profit cap.''
    For this review, the Department is calculating CV profit based on 
the amounts earned by Trofco on its home market sales of canned fruit 
other than pineapple (i.e., profit on sales of the same general 
category of merchandise as subject canned pineapple fruit under section 
773(e)(2)(B)(i) of the Act). For selling expenses, we cannot use 
alternative (i) because we do not have the information on Trofco's 
other canned fruit sales (other than pineapple) which we consider to be 
in the same general category of merchandise as subject canned pineapple 
fruit. In addition, we cannot use alternative (ii) without violating 
our responsibility to protect respondent's administrative protective 
order (APO) information, because Vita is the only other respondent in 
this review. Therefore, for selling expenses, we are using alternative 
(iii) 'any other reasonable method;' and basing Trofco's CV selling 
expenses on its reported home market sales. Therefore, we deducted home 
market credit expenses from CV and added U.S. credit to calculate the 
foreign unit price in dollars (FUPDOL), pursuant to section 
773(e)(2)(B)(iii) of the Act.

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 LOT as the EP or CEP sale. 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 
(November 19, 1997) (South African Plate Final). 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),\4\ including selling 
functions,\5\ class of customer (customer category), and the level of 
selling expenses for each type of sale.
---------------------------------------------------------------------------

    \4\ The marketing process in the United States and in the 
comparison markets begins with the producer and extends to the sale 
to the final user or consumer. The chain of distribution between the 
two may have many or few links, and the respondents' sales occur 
somewhere along this chain. In performing this evaluation, we 
considered the narrative responses of each respondent to properly 
determine where in the chain of distribution the sale occurs.
    \5\ Selling functions associated with a particular chain of 
distribution help us to evaluate the level(s) of trade in a 
particular market. For purposes of these preliminary results, we 
have organized the common selling functions into four major 
categories: sales process and marketing support, technical service, 
freight and delivery, and inventory maintenance.
---------------------------------------------------------------------------

    Pursuant to section 773(a)(1)(B)(i) of the Act, in identifying 
levels of trade for EP and comparison market sales (i.e., NV based on 
either home market or third-country prices), we consider the starting 
prices before any adjustments. With respect to CEP sales, the 
Department removes the selling activities set forth in section 772(d) 
of the Act from the CEP starting price prior to performing its LOT 
analysis. See Micron Technology, Inc. v. United States, 243 F.3d 1301, 
1315 (Fed. Cir. 2001). As such, for CEP sales, the U.S. LOT is based on 
the starting price of the sales, as adjusted under section 772(d) of 
the Act.
    When the Department is unable to match U.S. sales to sales of the 
foreign like product in the comparison market at the same LOT as the EP 
or CEP sale, the Department may compare the U.S. sale to sales at a 
different LOT in the comparison market. However, in this case, the 
Department preliminarily determines that no level of trade adjustment 
was necessary for Trofco and Vita, consistent with what the parties 
reported in their respective questionnaire responses. For further 
details on the Department's LOT analysis, see Vita Preliminary Analysis 
Memorandum and Trofco Preliminary Analysis Memorandum.

Currency Conversion

    In accordance with section 773A of the Act, we made currency 
conversions

[[Page 44495]]

based on the official exchange rates in effect on the dates of the U.S. 
sales as certified by the Federal Reserve Bank of New York. See also 19 
CFR 351.415.

Preliminary Results of Review

    As a result of this review, we preliminarily find that the 
following weighted-average dumping margins exist:

------------------------------------------------------------------------
                Manufacturer/Exporter                       Margin
------------------------------------------------------------------------
Vita Food Factory (1989) Ltd........................              7.11 %
Tropical Food Industries Co., Ltd...................             10.51 %
------------------------------------------------------------------------

Cash Deposit Requirements

    If these preliminary results are adopted in the final results of 
review, the following deposit requirements will be effective upon 
completion 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 of the final 
results of this administrative review, as provided in section 751(a)(1) 
of the Act: (1) The cash deposit rate for Vita will be that established 
in the final results of this review; (2) the cash deposit rate for 
Trofco will be that established in the final results of this review; 
(3) for previously reviewed or investigated companies not covered in 
this review, the cash deposit rate will continue to be the company-
specific rate published for the most recent period; (4) if the exporter 
is not a firm covered in this review, a prior review, or the less-than-
fair-value (LTFV) investigation, but the manufacturer is a firm covered 
in this review, the cash deposit rate will be the rate established for 
the most recent period for the manufacturer of the subject merchandise; 
and 5) if neither the exporter nor the manufacturer is a firm covered 
in this or any previous proceeding conducted by the Department, the 
cash deposit rate will continue to be the ``all others'' rate 
established in the LTFV investigation, which is 24.64 percent. See 
Antidumping Duty Order 71 FR at 36776. These cash deposit requirements, 
when imposed, shall remain in effect until further notice.

Duty Assessment

    Upon publication of the final results of this review, the 
Department shall determine, and CBP shall assess, antidumping duties on 
all appropriate entries. Pursuant to 19 CFR 351.212(b)(1), the 
Department calculates an assessment rate for each importer of the 
subject merchandise for each respondent. In accordance with 19 CFR 
351.212(b)(1), we will calculate importer-specific assessment rates on 
the basis of the ratio of the total amount of antidumping duties 
calculated for the examined sales and the total entered value of the 
examined sales. These rates will be assessed uniformly on all entries 
of the respective importers made during the POR if these preliminary 
results are adopted in the final results of review. The Department 
intends to issue appropriate assessment instructions directly to CBP 15 
days after the date of publication of the final results of this review.
    The Department clarified its ``automatic assessment'' regulation on 
May 6, 2003. See Antidumping and Countervailing Duty Proceedings: 
Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003) (Assessment 
Policy Notice). This clarification will apply to entries of subject 
merchandise during the POR produced by companies included in the final 
results of review for which the reviewed companies did not know that 
the merchandise it sold to the intermediary (e.g., a reseller, trading 
company, or exporter) was destined for the United States. In such 
instances, we will instruct CBP to liquidate unreviewed entries at the 
all-others rate if there is no rate for the intermediary involved in 
the transaction. See Assessment Policy Notice for a full discussion of 
this clarification.

Public Comment

    Pursuant to 19 CFR 351.224(b), the Department will disclose to any 
party to the proceeding the calculations performed in connection with 
these preliminary results within five days after the date of public 
announcement of this notice. Pursuant to 19 CFR 351.309, interested 
parties may submit written comments in response to these preliminary 
results. Unless extended by the Department, case briefs are to be 
submitted within 30 days after the date of publication of this notice. 
Rebuttal briefs, limited to arguments raised in case briefs, may be 
submitted no later than five days after the time limit for filing case 
briefs. Parties who submit arguments in this proceeding are requested 
to submit with the argument: (1) A statement of the issues; (2) a brief 
summary of the argument; and (3) a table of authorities. See 19 CFR 
309(c)(2). Case and rebuttal briefs must be served on interested 
parties in accordance with 19 CFR 351.303(f).
    Also, pursuant to 19 CFR 351.310(c), interested parties who wish to 
request a hearing or to participate if one is requested must submit a 
written request to the Assistant Secretary for Import Administration 
within 30 days of the publication of this notice. Requests should 
contain (1) the party's name, address and telephone number; (2) the 
number of participants; and, (3) a list of issues to be raised. Issues 
raised in the hearing will be limited to those raised in the respective 
case briefs. Unless the Secretary specifies otherwise, the hearing, if 
requested, will be held two days after the date for submission of 
rebuttal briefs. Parties will be notified of the time and location.
    The Department will issue the final results of this administrative 
review within 120 days after the publication of this notice, unless 
extended. See section 751(a)(3)(A) of the Act; 19 CFR 351.213(h).

Notification to Importers

    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f)(2) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    The preliminary results of this administrative review and this 
notice are issued and published in accordance with sections 751(a)(1) 
and 777(i)(1) of the Act.

    Dated: July 31, 2007.
Stephen J. Claeys,
Acting Assistant Secretary for Import Administration.
[FR Doc. E7-15489 Filed 8-7-07; 8:45 am]
BILLING CODE 3510-DS-S