Certain Frozen Warmwater Shrimp from India: Preliminary Results and Preliminary Partial Rescission of Antidumping Duty Administrative Review, 12103-12115 [E8-4417]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 73, Number 45 (Thursday, March 6, 2008)]
[Notices]
[Pages 12103-12115]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-4417]



[[Page 12103]]

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DEPARTMENT OF COMMERCE

International Trade Administration

A-533-840


Certain Frozen Warmwater Shrimp from India: Preliminary Results 
and Preliminary 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 India with respect to 201 companies.\1\ The 
respondents which the Department selected for individual review are 
Devi Sea Foods Limited (Devi) and Falcon Marine Exports Limited 
(Falcon). The respondents which were not selected for individual review 
are listed in the ``Preliminary Results of Review'' section of this 
notice. This is the second administrative review of this order. The 
period of review (POR) is February 1, 2006, through January 31, 2007.
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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 made by Devi and Falcon have 
been made at 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.

EFFECTIVE DATE: March 6, 2008.

FOR FURTHER INFORMATION CONTACT: Elizabeth Eastwood, AD/CVD Operations, 
Office 2, Import Administration, International Trade Administration, 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230; telephone: (202) 482-3874.

SUPPLEMENTARY INFORMATION:

Background

    In February 2005, the Department published in the Federal Register 
an antidumping duty order on certain warmwater shrimp from India. See 
Notice of Amended Final Determination of Sales at Less Than Fair Value 
and Antidumping Duty Order: Certain Frozen Warmwater Shrimp from India, 
70 FR 5147 (Feb. 1, 2005) (Shrimp Order). Subsequently, on February 2, 
2007, 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 India for the period 
February 1, 2006, through January 31, 2007. See Antidumping or 
Countervailing Duty Order, Finding, or Suspended Investigation; 
Opportunity to Request Administrative Review, 72 FR 5007 (Feb. 2, 
2007). In response to timely requests from interested parties pursuant 
to 19 CFR 351.213(b)(1) and (2) to conduct an administrative review of 
the sales of certain frozen warmwater shrimp from numerous producers/
exporters of subject merchandise, the Department published a notice of 
initiation of administrative review for 319 companies\2\ 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, 72 FR 17100 
(Apr. 6, 2007) (Notice of Initiation).
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    \2\ We note that we incorrectly stated in the Notice of 
Initiation that we were initiating administrative reviews for 313 
companies for India.
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    On April 5, 2007, the petitioner\3\ requested that the Department 
determine whether antidumping duties had been absorbed by the 
respondents that were to be required to participate in this review.
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    \3\ The petitioner is the Ad Hoc Shrimp Trade Action Committee.
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    During the period April through July 2007, we received responses to 
the Department's Q&V questionnaire from numerous companies. We were 
unable to locate 16 companies, and we did not receive properly filed 
responses to this questionnaire from the remaining companies.\4\ For 
further discussion of our treatment of this latter group of companies, 
see the ``Application of Facts Available'' section of this notice.
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    \4\ As discussed below, for certain of these companies, the 
petitioner subsequently withdrew its request for review.
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    On May 25, 2007, Surya Marine Exports (Surya), one of the companies 
that responded to our Q&V questionnaire, notified us that it had 
changed its name during the POR and is now doing business under the 
name Suryamitra Exim Private Limited (Suryamitra). As a result, we 
solicited information on this change from Suryamitra, which the company 
supplied in June 2007 and February 2008. After analyzing this 
information, we preliminarily find that Suryamitra is the successor-in-
interest to Surya Marine. For further discussion, see the ``Successor-
in-Interest'' section of this notice, below.
    On July 5, 2007, the Louisiana Shrimp Association (LSA) withdrew 
its request for an administrative review for 17 companies, with respect 
to which the petitioner also withdrew its request on March 16, 2007.
    Based upon our consideration of the responses received to the Q&V 
questionnaire 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 19, 2007, we selected the two largest producers/
exporters of certain frozen warmwater shrimp from India during the POR 
(i.e., Devi and Falcon) as the mandatory respondents in this 
proceeding. See the memorandum to Stephen J. Claeys, Deputy Assistant 
Secretary for Import Administration, from James Maeder, Director, 
Office 2, AD/CVD Operations, entitled, ``2006-2007 Antidumping Duty 
Administrative Review of Certain Frozen Warmwater Shrimp from India: 
Selection of Respondents for Individual Review,'' dated July 19, 2007. 
On this same date, we issued the antidumping duty questionnaire to Devi 
and Falcon.
    On July 26, 2007, we issued a letter to a non-selected Indian 
producer/exporter, Gajula Exim (P) Ltd. (Gajula), requesting that it 
reconcile its claim made in response to the Q&V questionnaire that it 
did not ship subject merchandise to the United States during the POR 
with information obtained from CBP. Although Gajula responded to this 
request for information in August 2007, it failed to properly file its 
response with the Department, despite repeated requests that it do so. 
Therefore, we have preliminarily assigned to Gajula a margin based on 
AFA. For further discussion, see the ``Application of Facts Available'' 
section of this notice, below.

[[Page 12104]]

    We received responses to sections A, B, and C of the questionnaire 
from Devi and Falcon in August and September 2007. We also received a 
response to section D of the questionnaire from Devi in September 2007.
    On August 24, 2007, the petitioner submitted comments regarding 
third country market selection with respect to Falcon, and on September 
10, 2007, we determined that Japan is the appropriate third country 
comparison market for this respondent. See the memorandum to James 
Maeder, Director, Office 2, AD/CVD Operations, from The Team entitled, 
``2006-2007 Antidumping Duty Administrative Review on Certain Frozen 
Warmwater Shrimp from India - Selection of the Appropriate Third 
Country Market for Falcon Marine Exports Limited,'' dated September 10, 
2007 (Selection of Third County Markets Memo). See also the ``Home 
Market Viability and Selection of Comparison Markets'' section of this 
notice, below, for further discussion.
    On September 24, 2007, we provided Devi and Falcon an opportunity 
to submit proof that their unaffiliated purchasers will ultimately pay 
any antidumping duties assessed in this administrative review on their 
merchandise. Neither company responded to this request.
    On September 25, 2007, we issued a letter to four Indian exporters/
producers participating in this review (i.e., Kadalkanny Frozen Foods 
(Kadalkanny), Edhayam Frozen Foods Pvt. Ltd. (Edhayam), Diamond Seafood 
Exports (Diamond), and Theva & Co. (Theva) (collectively, the 
``Kadalkanny Group'')) regarding the companies' relationships with each 
other.
    On September 27, 2007, the petitioner requested that the Department 
initiate a sales-below-cost investigation related to Falcon's sales to 
Japan.
    On October 11, 2007, we received a response to the Department's 
September 25, 2007, letter from the Kadalkanny Group.
    On October 16, 2007, we initiated a sales-below-cost investigation 
for Falcon. See the memorandum to James Maeder, Director, Office 2, AD/
CVD Operations, from The Team entitled, ``The Petitioner's Allegation 
of Sales Below the Cost of Production for Falcon Marine Exports 
Limited,'' dated October 16, 2007 (Sales-Below-Cost-Memo for Falcon). 
On this same date, we required Falcon to respond to section D of the 
questionnaire. It submitted its response in December 2007.
    On October 19, 2007, an Indian governmental agency, the Marine 
Products Export Development Authority (MPEDA), requested that the 
Department rescind the administrative review with respect to the 
following Indian companies: 1) those exporters for which the review was 
requested solely by either the petitioner or the LSA, based on the 
claim that these requests did not meet the requirements of 19 CFR 
351.213(b); and 2) any exporters which are not registered with MPEDA 
and did not respond to the Department's request for information, based 
on the claim that these companies are not permitted to export products 
from India (and, thus, could not have shipped subject merchandise to 
the United States during the POR). For further discussion of this 
request, see the ``Partial Rescission of Review'' section of this 
notice, below.
    On October 26, 2007, the Department postponed the preliminary 
results in this review until no later than February 28, 2008. See 
Certain Frozen Warmwater Shrimp From Brazil, Ecuador, India, Thailand, 
and the Socialist Republic of Vietnam: Notice of Extension of Time 
Limits for the Preliminary Results of the Second Administrative 
Reviews, 72 FR 60800 (Oct. 26, 2007).
    On November 13, 2007, we again contacted the Kadalkanny Group 
regarding the affiliation among the individual members of the Group. We 
received its response in December 2007.
    On December 10, 2007, we requested that Devi provide additional 
information related to its reported comparison market sales.
    On December 20, 2007, we determined that it was appropriate to 
collapse the companies within the Kadalkanny Group and thus to treat 
them as a single entity in this proceeding, in accordance with 19 CFR 
351.401(f). For further discussion, see the ``Collapsing the Kadalkanny 
Group'' section of this notice, below.
    During the period October 2007 through February 2008, we issued to 
Falcon and Devi several supplemental questionnaires regarding sections 
A, B, C, and D of the original questionnaires. We received responses to 
these questionnaires during the period November 2007 through February 
2008.
    On January 8, 2008, we notified interested parties of our intent to 
rescind this administrative review with respect to a number of Indian 
producers/exporters of subject merchandise. See the memorandum to the 
File from Elizabeth Eastwood, Senior Analyst, entitled, ``Intent to 
Rescind In Part the 2006-2007 Antidumping Duty Administrative Review on 
Frozen Warmwater Shrimp from India,'' dated January 8, 2008 (Intent to 
Rescind Memo).
    On January 11, 2008, we received comments on the Intent to Rescind 
Memo from a non-selected Indian producer/exporter participating in this 
review, Asvini Fisheries Private Limited (Asvini). In its January 11 
submission, Asvini notified us that it had changed its name during the 
POR from Asvini Fisheries Limited to Asvini, and it requested that the 
Department not rescind the review with respect to Asvini under its 
former name.
    On January 25, 2008, we published a notice rescinding the 
administrative review with respect to 114 companies, based on: 1) 
timely withdrawals of the review requests; 2) confirmed statements of 
no shipments during the POR; 3) our inability to locate certain 
companies; and/or 4) duplicated names in our notice of initiation. See 
Certain Frozen Warmwater Shrimp from India; Partial Rescission of 
Antidumping Duty Administrative Review, 73 FR 6125 (Feb. 1, 2008) 
(Notice of Rescission). See also the Intent to Rescind Memo.
    On February 5, 2008, we solicited information from Asvini regarding 
its name change, which the company supplied on February 19, 2008. After 
analyzing this information, we preliminarily find that Asvini Fisheries 
Private Limited is the successor-in-interest to Asvini Fisheries 
Limited. For further discussion, see the ``Successor-in-Interest'' 
section of this notice, below.
    Finally, on February 28, 2008, we requested additional information 
from Devi and Falcon regarding their reported U.S. sales of subject 
merchandise. Because this information is not due until after the date 
of these preliminary results, we will consider it for purposes of the 
final results.

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

[[Page 12105]]

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).
    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 (HTSUS 
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 (HTSUS subheadings 0306.23.00.20 and 0306.23.00.40); 4) shrimp 
and prawns in prepared meals (HTSUS subheading 1605.20.05.10); 5) dried 
shrimp and prawns; 6) canned warmwater shrimp and prawns (HTSUS 
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.

Successor-in-Interest

    In making a normal successor-in-interest determination, the 
Department examines several factors including, but not limited to, 
changes in: (1) management; (2) production facilities; (3) supplier 
relationships; and (4) customer base. See Notice of Final Results of 
Changed Circumstances Antidumping Duty Administrative Review: 
Polychloroprene Rubber From Japan, 67 FR 58 (Jan. 2, 2002), and Brass 
Sheet and Strip from Canada; Final Results of Antidumping Duty 
Administrative Review, 57 FR 20460 (May 13, 1992). While no one of 
these factors is dispositive, the Department will generally consider 
the new company to be the successor to the previous company if its 
resulting operation is not materially dissimilar to that of its 
predecessor. See Industrial Phosphoric Acid from Israel; Final Results 
of Antidumping Duty Changed Circumstances Review, 59 FR 6944 (Feb. 14, 
1994); and Notice of Final Determination of Sales at Less Than Fair 
Value and Affirmative Final Determination of Critical Circumstances: 
Certain Orange Juice from Brazil, 71 FR 2183 (Jan. 13, 2006).
    As noted above, during the course of this review, two Indian 
producers/exporters of subject merchandise informed the Department that 
they have changed their names and are now doing business under new 
names. As a result, we are conducting investigations to determine 
whether the new companies are successors-in-interest to the former 
entities. Our findings are discussed below.

A. Asvini

    In April 2007, Asvini submitted a consolidated response to the 
Department's Q&V questionnaire on behalf of itself and Asvini Fisheries 
Limited. In this submission, Asvini informed the Department that the 
two companies are the same entity, and that, until March 2005, Asvini 
had operated under the name Asvini Fisheries Limited. Asvini provided a 
``Fresh Certificate of Incorporation Consequent on Change of Name'' 
demonstrating that Asvini Fisheries Limited was converted from a public 
company to a private company at that time and renamed Asvini Fisheries 
Private Limited.
    In January 2008, based on Asvini's assertions in its April 2007 
submission, the Department notified all interested parties that it 
intended to rescind the review with respect to Asvini Fisheries Limited 
because it considered this company name to be a duplicate of Asvini. 
See the Intent to Rescind Memo. At that time, we afforded all 
interested an opportunity to comment on this action. On January 11, 
2008, Asvini requested that the Department not rescind the review for 
Asvini Fisheries Limited because, although this company name no longer 
legally existed during the POR, Asvini continued to use it to make 
shipments of subject merchandise to the United States. According to 
Asvini, this occurred because the customs bond required by CBP was 
still in the name of Asvini Fisheries Limited and CBP insisted that the 
company name on the entry documents conform to the bond. On February 5, 
2008, we requested information related to Asvini's name change to 
determine if Asvini is the successor-in-interest to Asvini Fisheries 
Limited. Specifically, we requested that Asvini address any changes in 
the four factors noted above (i.e., management, production facilities 
for the subject merchandise, supplier relationships, and customer base) 
in the former company and the reincorporated entity.
    On February 19, 2008, Asvini responded to the Department's request. 
In this submission, Asvini provided evidence that, in March 2005, 
Asvini Fisheries Limited changed its name to Asvini Fisheries Private 
Limited, and that the name change had no effect on the company's 
operations. According to Asvini, there were no changes to Asvini 
Fisheries Limited's management, production facilities for the subject 
merchandise, supplier relationships, or customer base as a result of 
the change in corporate structure. Specifically, Asvini maintained that 
the only change as a result of the name change was to convert the 
company from a public limited company under Indian law to a private 
limited company.
    Based on our analysis of Asvini's February 19, 2008, submission, we 
preliminarily find that Asvini Fisheries Limited's organizational 
structure, management, production facilities, supplier relationships, 
and customers have remained essentially unchanged. Further, we 
preliminarily find that Asvini operates as the same business entity as 
Asvini Fisheries Limited with respect to the production and sale of

[[Page 12106]]

shrimp. Thus, we preliminarily find that Asvini is the successor-in-
interest to Asvini Fisheries Limited, and, as a consequence, the 
Department has treated these companies as the same entity for purposes 
of this proceeding. For further discussion, see the memorandum to James 
Maeder, Office Director, from Henry Almond, Analyst, entitled, 
``Successor-In-Interest Determination for Asvini Fisheries Private 
Limited and Asvini Fisheries Limited in the 2006-2007 Antidumping Duty 
Administrative Review of Certain Frozen Warmwater Shrimp from India,'' 
dated February 28, 2008.

B. Surya

    In May 2007, Surya informed the Department that the company changed 
its name at the beginning of the POR to Suryamitra, and it is now doing 
business under this new name. As a result, on June 13, 2007, we 
requested that Suryamitra address the four factors noted above (i.e., 
management, production facilities for the subject merchandise, supplier 
relationships, and customer base) with respect to this change in name 
in order to determine whether Suryamitra is the successor-in-interest 
to Surya.
    On June 27, 2007, Suryamitra responded to the Department's request. 
In this submission, Suryamitra provided evidence that, in February 
2006, Surya changed its name to Suryamitra, and that the name change 
had no effect on the company's operations. According to this evidence, 
Suryamitra explained that there were no changes to Surya's management, 
production facilities for the subject merchandise, supplier 
relationships, or customer base as a result of the change in corporate 
structure. Specifically, Suryamitra maintained that the only change as 
a result of the name change was to convert the company from a 
partnership firm under Indian law to a private limited company. On 
January 29, 2008, we requested additional documentation from Suryamitra 
to support its statements that the name change did not affect its 
production facilities, supplier relationships, and customer base. 
Suryamitra provided this information on February 27, 2008.
    Based on our analysis of Suryamitra's June 27, 2007, and February 
27, 2008, submissions, we preliminarily find that Surya's 
organizational structure, management, production facilities, supplier 
relationships, and customers have remained essentially unchanged. 
Further, we preliminarily find that Suryamitra operates as the same 
business entity as Surya with respect to the production and sale of 
shrimp. Thus, we preliminarily find that Suryamitra is the successor-
in-interest to Surya and, as a consequence, the Department has treated 
these companies as the same entity for purposes of this proceeding. For 
further discussion, see the memorandum to James Maeder, Office 
Director, from Elizabeth Eastwood, Senior Analyst, entitled, 
``Successor-In-Interest Determination for Surya Marine Exports and 
Suryamitra Exim Pvt. Ltd. in the 2006-2007 Antidumping Duty 
Administrative Review of Certain Frozen Warmwater Shrimp from India,'' 
dated February 28, 2008.

Collapsing the Kadalkanny Group

    As noted above, on April 23, 2007, the Kadlakanny Group submitted a 
consolidated response to the Department's Q&V questionnaire. In October 
and December 2007, we received information from these companies 
regarding their relationships with each other during the POR. After an 
analysis of this information, we determined that, in accordance with 19 
CFR 351.401(f), it is appropriate to collapse these entities for 
purposes of this review because: 1) entities within the group are 
affiliated and have production facilities for identical or similar 
merchandise that would not require significant retooling in order to 
restructure manufacturing priorities; and 2) a significant potential 
for manipulation exists due to common ownership, overlapping management 
and board of directors, and intertwined operations. For further 
discussion, see the memorandum from The Team to James Maeder, Director, 
Office 2, entitled ``Whether to Collapse Kadalkanny Frozen Foods, 
Edhayam Frozen Foods Pvt. Ltd., Diamond Seafood Exports, and Theva & 
Co. in the 2006-2007 Antidumping Duty Administrative Review of Certain 
Frozen Warmwater Shrimp from India,'' dated December 20, 2007.

Preliminary Partial Rescission of Review

    As noted above, in February 2007, the Department received timely 
requests, in accordance with 19 CFR 351.213(b)(1), from the petitioner 
and the LSA to conduct a review of the four Indian producers/exporters 
of subject merchandise in the Kadalkanny Group. The Department 
initiated a review of these four companies and requested that they 
supply data on the quantity and value of their exports of shrimp during 
the POR. In April 23, 2007, the Kadalkanny Group submitted a 
consolidated response to the Department's Q&V questionnaire, in which 
it indicated that only one of its members (i.e., Kadalkanny) exported 
subject merchandise to the United States during the POR.
    Both the petitioner and the LSA withdrew their administrative 
review requests for Kadalkanny. Moreover, we confirmed with CBP the 
claims made by two additional members of this group, Diamond and Theva, 
that they had no shipments of subject merchandise during the POR. 
Finally, on January 17 and February 7, 2008, we received information 
from Edhayam which demonstrated that its sole entry of subject 
merchandise during the POR was not a reportable transaction because it 
was a free sample. 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 the Kadalkanny Group. 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).
    In addition, also as noted above, in October 2007 MPEDA requested 
that the Department rescind the administrative review with respect to 
the following Indian companies: 1) those exporters for which the review 
was requested solely by either the petitioner or the LSA, based on the 
claim that these requests did not meet the requirement of 19 CFR 
351.213(b); and 2) any exporters which are not registered with MPEDA 
and did not respond to the Department's request for information, based 
on the claim that these companies do not have export licenses and are 
not permitted to export products from India (and, thus, could not have 
shipped subject merchandise to the United States during the POR). After 
considering these requests, we find that there is no basis to rescind 
this administrative review for any companies other than those in the 
Kadalkanny Group. Specifically, regarding MPEDA's first point, under 19 
CFR 351.213(b), a party requesting an administrative review must list 
the individual exporters or producers for which it is requesting 
administrative reviews and state why it desires the Department to 
review those particular exporters or producers. The review requests 
submitted by both the petitioner and the LSA satisfied the requirements 
of 19 CFR 351.213(b), and thus there is no basis to rescind the 
administrative reviews requested by these parties. Regarding MPEDA's 
second point, under the regulations the Department may only rescind 
administrative reviews for which the

[[Page 12107]]

requester maintains its request if the Department concludes that the 
respondent had no shipments during the POR pursuant to 19 CFR 
351.213(d)(3). We have examined the evidence placed on the record by 
MPEDA to demonstrate that certain respondents could not have shipped 
subject merchandise during the POR and find that this information is 
contradicted by information placed on the record by other parties to 
this proceeding. Specifically, we note that certain of the companies 
that MPEDA claims are prohibited from exporting subject merchandise 
did, in fact, provide data on their exports of such merchandise to the 
Department in their Q&V questionnaire responses, and thus the 
information submitted by MPEDA is not reliable. See, e.g., the April 
20, 2007, Q&V questionnaire response of Devi Sea Foods Limited; and the 
April 23, 2007, Q&V questionnaire responses of Asvini Fisheries 
Limited, Selvam Exports Private Limited, Asvini Exports, Devi Fisheries 
Limited, Satya Seafoods Private Limited, Usha Seafoods, Five Star 
Marine Exports Private Limited, Sagar Grandhi Exports Pvt. Ltd., GVR 
Exports Pvt. Ltd., Star Agro Marine Exports Private Limited, Wellcome 
Fisheries Limited, and Vinner Marine. Further, because our review 
covers the first party in the commercial chain that had knowledge that 
the merchandise was ultimately destined for the United States, the mere 
fact that a company subject to the review did not have an export 
license and was not the official exporter does not disqualify it from 
the review or otherwise require that we rescind the review of these 
companies. See Certain Frozen Warmwater Shrimp from India: Final 
Results and Partial Rescission of Antidumping Duty Administrative 
Review, 72 FR 52055 (Sept. 12, 2007), and accompanying Issues and 
Decisions Memorandum at Comment 12 (citing Hyundai Elecs. Indus. Co. v. 
United States, 342 F. Supp.2d 1141, 1146 (CIT 2004)); and Certain Cut-
to-Length Carbon-Quality Steel Plate Products From Italy: Final Results 
and Partial Rescission of Antidumping Duty Administrative Review, 71 FR 
39299 (July 12, 2006), and accompanying Issues and Decisions Memorandum 
at Comment 1 (``[U]nder section 772(a) of the Act, the basis for export 
price is the price at which the first party in the chain of 
distribution who has knowledge of the U.S. destination of the 
merchandise sells the subject merchandise, either directly to a U.S. 
purchaser or to an intermediary such as a trading company. The party 
making such a sale, with knowledge of the destination, is the 
appropriate party to be reviewed.''). Consequently, we preliminarily 
determine that it is not appropriate to rely upon the information 
submitted by MPEDA or to partially rescind the review based on MPEDA's 
October 19, 2007, request.

Application of Facts Available

    Section 776(a) of the Tariff Act of 1930, as amended, 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 2007, 
the Department requested that all companies subject to review respond 
to the Department's Q&V questionnaire for purposes of mandatory 
respondent selection. The original deadline to file a response was 
April 23, 2007. Of the 319 companies initially subject to review, 
numerous companies did not respond to the Department's initial requests 
for information. Subsequently, in May 2007 and then again in June 2007, 
the Department issued letters to these companies affording them 
additional opportunities to submit a response to the Department's Q&V 
questionnaire. However, 126 companies also failed to respond to the 
Department's final requests for Q&V data.\6\ On February 25, 2008, the 
Department placed documentation on the record confirming delivery of 
the questionnaires to each of these companies. See the memorandum to 
the File from Elizabeth Eastwood, Senior Analyst, entitled, ``Placing 
Delivery Information on the Record of the 2006-2007 Antidumping Duty 
Administrative Review on Certain Frozen Warmwater Shrimp from India,'' 
dated February 25, 2008. 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 warranted.
---------------------------------------------------------------------------

    \6\ These companies are listed in the ``Preliminary Results of 
the Review'' section of this notice under the heading ``AFA Rate 
Applicable to the Following Companies.''
---------------------------------------------------------------------------

    Furthermore, one additional company, Gajula, claimed that it made 
no shipments of subject merchandise to the United States during the 
POR. However, because we were unable to confirm the accuracy of 
Gajula's claim with CBP, we requested further information/clarification 
from this exporter. Gajula responded to the Department's inquiry via e-
mail on August 16, 2007, but did not indicate if its submission 
contained either public or business proprietary information. Therefore, 
on August 16, 2007, we informed Gajula via e-mail of the Department's 
filing requirements. See the memorandum to the File from Nichole Zink, 
Analyst, entitled, ``Placing E-mail to Gajula Exim (P) Ltd. on the 
Record in the 2006-2007 Antidumping Duty Administrative Review of 
Certain Frozen Warmwater Shrimp from India'' (First Gajula E-Mail 
Memo), dated August 16, 2007. On August 22, 2007, Gajula submitted a 
hard copy of its response, but again failed to follow the Department's 
filing requirements and failed to indicate if the submission contained 
business proprietary or public information. On September 7, 2007, we 
issued a letter to Gajula again informing the company of the 
Department's filing requirements, providing information regarding the 
treatment of proprietary information and the preparation of a public 
version of a response, and requiring it to properly file its response. 
On September 29, 2007, Gajula faxed a letter to the Department in which 
it stated that the information contained in its August submission 
should be treated as business proprietary information. However, Gajula 
did not indicate the specific information in the August submission 
which should be designated as business proprietary. As a result, on 
October 1 and 17, 2007, we provided Gajula additional detailed 
instructions regarding the treatment of proprietary information and the 
preparation of a public version of a response, and we again required it 
to properly file its submissions on the record of this proceeding. See 
the memorandum to the File from Elizabeth Eastwood, Senior Analyst, 
entitled, ``Placing October E-Mail Correspondence with Gajula Exim (P) 
Ltd. on the Record of the 2006-2007 Antidumping Duty Administrative 
Review of Certain Frozen Warmwater Shrimp from India'' (Second Gajula 
E-Mail Memo), dated October 17, 2007. Gajula failed to respond to the 
Department's October communications

[[Page 12108]]

and did not remedy the deficiencies in its August submission.
    Although the Department afforded Gajula multiple opportunities to 
correct the procedural deficiencies in its response, it failed to do 
so. By failing to respond to the Department's requests, Gajula withheld 
requested information and significantly impeded the proceeding. 
Consequently, pursuant to sections 776(a)(2)(A) and (C) of the Act, the 
Department preliminarily finds that the use of total facts available 
for Gajula 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. 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, 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 each of 
the 127 companies listed under the heading ``AFA Rate Applicable to the 
Following Companies'' in the ``Preliminary Results of the Review'' 
section of this notice, below, 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 110.9 
percent, which is the highest rate alleged in the petition (as adjusted 
at the initiation of the 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, 3880 (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 the petition 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 margins in the petition, we compared them to the 
transaction-specific rates calculated for each respondent in this 
review. We find that the highest rate alleged in the petition (as 
adjusted at the initiation of the LTFV investigation), 110.9 percent, 
is reliable and relevant because it is similar to a transaction-
specific margin calculated for a mandatory respondent and there is no 
evidence on the record of this administrative review to indicate that 
this transaction-specific margin is aberrational. 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). For the 
company-specific information used to corroborate this rate, see the 
memorandum to the File from Henry Almond, Analyst, entitled 
``Corroboration of Adverse Facts Available Rate for the Preliminary 
Results in the 2006-2007 Antidumping Duty Administrative Review of 
Certain Frozen Warmwater Shrimp from India,'' dated February 28, 2008. 
Therefore, we have determined that the 110.9 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 
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 is similar to a 
transaction-specific margins calculated for a mandatory respondent, we 
have preliminarily determined that the 110.9 percent margin, as alleged 
in the petition and adjusted at the initiation of the LTFV 
investigation, is appropriate as AFA and are assigning this rate to the 
127 companies listed under the heading ``AFA Rate Applicable to the 
Following Companies'' in the ``Preliminary Results of the Review'' 
section of this notice, below.

Duty Absorption

    On April 5, 2007, the petitioner requested that the Department 
determine whether antidumping duties had been absorbed during the POR. 
Section 751(a)(4) of the Act provides for the Department, if requested, 
to determine during an administrative review initiated two or four 
years after the publication of the order, whether antidumping duties 
have been absorbed by a foreign producer or exporter, if the subject 
merchandise is sold in the United States through an affiliated 
importer. Although this review was initiated two years after the 
publication of the order, Falcon, one of the two mandatory respondents, 
made only

[[Page 12109]]

export price (EP) sales to unaffiliated parties during the POR, while 
Devi, the other mandatory respondent, acted as the importer of record 
for both its EP and constructed export price (CEP) sales during the 
POR. Therefore, it is not appropriate to make a duty absorption 
determination in this segment of the proceeding within the meaning of 
section 751(a)(4) of the Act. See Agro Dutch Industries Ltd. v. United 
States, 508 F.3d 1024, 1033 (Fed. Cir. 2007).

Comparisons to Normal Value

    To determine whether sales of certain frozen warmwater shrimp from 
India to the United States were made at less than NV, we compared the 
EP or CEP to the NV, as described in the ``Constructed Export Price/
Export Price'' and ``Normal Value'' sections of this notice.
    Pursuant to sections 773(a)(1)(B)(i) and 777A(d)(2) of the Act, for 
Devi and Falcon, we compared the EPs or CEPs of individual U.S. 
transactions, as applicable, to the weighted-average NV of the foreign 
like product in the appropriate corresponding calendar month where 
there were sales made in the ordinary course of trade, as discussed in 
the ``Cost of Production Analysis'' section below.

Product Comparisons

    In accordance with section 771(16)(A) of the Act, we considered all 
products produced by Devi and Falcon 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 non-broken 
shrimp to sales of non-broken shrimp made in Canada (for Devi) and 
Japan (for Falcon) within the contemporaneous window period, which 
extends from three months prior to the month of the first U.S. sale 
until two months after the last U.S. sale. Where there were no sales of 
identical non-broken merchandise in the comparison market made in the 
ordinary course of trade to compare to U.S. sales, according to section 
771(16)(B) of the Act, we compared U.S. sales to sales of the most 
similar foreign like product made in the ordinary course of trade. For 
Devi and Falcon, where there were no sales of identical or similar 
merchandise, we made product comparisons using constructed value (CV). 
See section 773(a)(4) of the Act.
    With respect to sales comparisons involving broken shrimp, we 
compared Falcon's sales of broken shrimp in the United States to CV 
because Falcon made no sales of broken shrimp in its comparison market.
    In making the product comparisons, we matched foreign like products 
based on the physical characteristics reported by Devi and Falcon 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 Falcon, and for certain U.S. sales made 
by Devi, we used EP methodology, in accordance with section 772(a) of 
the Act, because the subject merchandise was sold by the producer/
exporter outside of the United States 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 the remaining U.S. sales made by Devi, we calculated CEP in 
accordance with section 772(b) of the Act because the subject 
merchandise was sold for the account of this company by its subsidiary 
in the United States to unaffiliated purchasers.

A. Devi

    We based EP on packed prices to the first unaffiliated purchaser in 
the United States. Where appropriate, we made deductions from the 
starting price for discounts in accordance with 19 CFR 351.401(c). We 
also made deductions from the starting price for foreign inland freight 
expenses, other miscellaneous shipment charges, foreign brokerage and 
handling expenses, international freight expenses (including terminal 
handling charges), marine insurance, U.S. customs duties, U.S. 
brokerage and handling expenses, U.S. warehousing expenses, and U.S. 
inland freight expenses, where appropriate, in accordance with section 
772(c)(2)(A) of the Act. We also made deductions for export taxes in 
accordance with section 772(c)(2)(B) of the Act.
    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. We based CEP on the packed delivered prices to 
unaffiliated purchasers in the United States. Where appropriate, we 
made adjustments for discounts and rebates in accordance with 19 CFR 
351.401(c). We made deductions for movement expenses, in accordance 
with section 772(c)(2)(A) of the Act; these included, where 
appropriate, foreign inland freight expenses, foreign warehousing 
expenses, foreign inland insurance expenses, foreign brokerage and 
handling expenses, ocean freight expenses, marine insurance expenses, 
U.S. brokerage and handling expenses, U.S. customs duties (including 
harbor maintenance fees and merchandise processing fees), U.S. inland 
insurance expenses, U.S. inland freight expenses (i.e., freight from 
port to warehouse and freight from warehouse to the customer), and U.S. 
warehousing expenses.
    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., bank charges, export inspection agency (EIA) fees, 
imputed credit expenses, and other direct selling expenses), 
commissions, and indirect selling expenses (including inventory 
carrying costs and other indirect selling expenses). For those sales 
for which Devi had not received payment as of the date of its most 
recent questionnaire response, we recalculated U.S. credit expenses 
using the date of the preliminary results as the date of payment. 
Finally, where commissions were paid in the U.S. market but not in the 
comparison market, we offset these commissions by the lesser of: 1) the 
amount of commission paid in the U.S. market; or 2) the amount of 
indirect selling expenses (including inventory carrying costs) incurred 
in the comparison market. We recalculated inventory carrying costs 
using the manufacturing costs reported in Devi's most recent COP 
database, adjusted as noted in the ``Calculation of Cost of 
Production'' section of this notice, below.
    Pursuant to section 772(d)(3) of the Act, we further reduced the 
starting price by an amount for profit to arrive at CEP. In accordance 
with section 772(f) of the Act, we calculated the CEP profit rate using 
the expenses incurred by Devi and its U.S. affiliate on their sales of 
the subject merchandise in the United States and the profit associated 
with those sales.

B. Falcon

    We based EP on packed prices to the first unaffiliated purchaser in 
the United States. Where appropriate, we made deductions from the 
starting price for discounts in accordance with 19 CFR 351.401(c). We 
also made deductions from the starting price for cold storage

[[Page 12110]]

expenses, loading and unloading expenses, trailer hire expenses, 
foreign inland freight expenses, port charges, export survey charges, 
terminal and handling charges, other miscellaneous shipment charges, 
foreign brokerage and handling expenses, international freight 
expenses, marine insurance expenses, U.S. customs duties (including 
harbor maintenance fees and merchandise processing fees), and U.S. 
brokerage and handling expenses, where appropriate, in accordance with 
section 772(c)(2)(A) of the Act. We also made deductions for export 
taxes in accordance with section 772(c)(2)(B) of the Act.

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.
    We determined that the aggregate volume of home market sales of the 
foreign like product for Devi and Falcon was insufficient to permit a 
proper comparison with U.S. sales of the subject merchandise. 
Therefore, we used sales to Canada and Japan as the basis for 
comparison market sales for Devi and Falcon, respectively, in 
accordance with section 773(a)(1)(C) of the Act and 19 CFR 351.404 
because, among other things, sales of foreign like product in these 
third country markets were the most similar to the subject merchandise. 
See the Selection of Third Country Markets Memo for further discussion.

B. 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 market 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),\7\ 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 Tech., Inc. v. 
United States, 243 F.3d 1301, 1314-16 (Fed. Cir. 2001).
---------------------------------------------------------------------------

    \7\ 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 possible, 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 possible), the Department shall grant a 
CEP offset, as provided in section 773(a)(7)(B) of the Act. See, e.g., 
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.

1. Devi

    Devi reported that it made sales through two channels of 
distribution in the United States (i.e., EP sales made directly to 
unaffiliated customers and CEP sales via an affiliated reseller); 
however, it stated that the selling activities it performed did not 
vary by channel of distribution. Devi reported performing the following 
selling functions for its U.S. sales: handling of sales inquiries, 
order processing, sales planning, personnel training, sales promotion, 
warranty service, freight and delivery services (including pre-shipment 
inspection, foreign transportation, export customs clearance, U.S. 
import clearance, and U.S. transportation), inventory maintenance in 
India, extension of credit to U.S. customers, 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 Devi performed sales and marketing, freight and 
delivery services, inventory maintenance and warehousing, and warranty 
and technical support for U.S. sales. Because Devi's selling activities 
did not vary by distribution channel, we preliminarily determine that 
there is one LOT in the U.S. market.
    With respect to Canada, Devi reported that it made sales through a 
single channel of distribution (i.e., sales made directly to 
unaffiliated customers). We examined the selling activities performed 
for third country sales and found that Devi performed the following 
selling functions: handling of sales inquiries, order processing, sales 
planning, personnel training, sales promotion, warranty service, 
freight and delivery services (including pre-shipment inspection and 
foreign transportation), inventory maintenance in India, extension of 
credit to Canadian customers, and packing. Accordingly, based on the 
core selling functions noted above, we find that Devi performed sales 
and marketing, freight and delivery services, and inventory maintenance 
and warehousing, and warranty and technical services for third country 
sales. Because all third country sales are made through a single 
distribution channel and the selling activities to Devi's customers did 
not vary within this channel, we preliminarily determine that there is 
one LOT in the third country market for Devi.
    Finally, we compared the U.S. LOT to the third country market LOT 
and found that the core selling functions performed for U.S. and third 
country market customers do not differ. Therefore, we determine that 
sales to the U.S. and third country markets during the POR were made at 
the same LOT, and as a result, no LOT adjustment is warranted.

[[Page 12111]]

2. Falcon

    Falcon reported that it made EP sales in the U.S. market to trading 
companies and distributors. Because Falcon reported no difference in 
the selling activities it performed for these two customer categories, 
we find that there is only one channel of distribution for Falcon's EP 
sales. We examined the selling activities performed for this channel 
and found that Falcon performed the following selling functions: 
customer contact and price negotiation; order processing; arranging for 
freight and the provision of customs clearance/brokerage services; cold 
storage and inventory maintenance; quality assurance related 
activities; payment receipt; and packaging services. 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 Falcon 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 third country market, Falcon reported that it 
made sales to trading companies. We examined the selling activities 
performed for third country sales, and found that Falcon performed the 
following selling functions: customer contact and price negotiation; 
order processing; arranging for freight and the provision of customs 
clearance/brokerage services; cold storage and inventory maintenance; 
quality assurance related activities; payment receipt; and packaging 
services. Accordingly, based on the core selling functions, we find 
that Falcon performed sales and marketing, freight and delivery 
services, and inventory maintenance and warehousing for third country 
sales. Because all third country sales are made through a single 
distribution channel and the selling activities to Falcon's customers 
did not vary within this channel, we preliminarily determine that there 
is one LOT in the third country market for Falcon.
    Finally, we compared the EP LOT to the third country market LOT and 
found that the core selling functions performed for U.S. and third 
country market customers do not differ. Therefore, we determine that 
sales to the U.S. and third country markets during the POR were made at 
the same LOT, and as a result, no LOT adjustment is warranted.

C. Cost of Production Analysis

    We found that Devi had made sales below the COP in the LTFV 
investigation, the most recently completed segment of this proceeding 
as of the date the questionnaire was issued in this review, and such 
sales were disregarded. See Notice of Preliminary Determination of 
Sales at Less Than Fair Value, Postponement of Final Determination, and 
Affirmative Preliminary Determination of Critical Circumstances: 
Certain Frozen and Canned Warmwater Shrimp from India, 69 FR 47111, 
47116-17 (Aug. 4, 2004); unchanged in 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 
India, 69 FR 76916 (Dec. 23, 2004) (LTFV Final Determination). Thus, in 
accordance with section 773(b)(2)(A)(ii) of the Act, there are 
reasonable grounds to believe or suspect that Devi made sales in the 
third country market at prices below the cost of producing the 
merchandise in the current review period.
    Moreover, based on our analysis of the petitioner's allegation, we 
found that there were reasonable grounds to believe or suspect that 
Falcon's sales of frozen warmwater shrimp in the third country 
comparison market were made at prices below their COP. Accordingly, 
pursuant to section 773(b) of the Act, we initiated a sales-below-cost 
investigation to determine whether Falcon's sales were made at prices 
below their respective COPs. See the Sales-Below-Cost Memo for Falcon.

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 third country selling expenses).
    The Department relied on the COP data submitted by each respondent 
in its most recently submitted cost database for the COP calculation, 
exc