Porcelain-on-Steel Cooking Ware from the People's Republic of China: Notice of Preliminary Results of Antidumping Duty Administrative Review, 52021-52024 [E8-20748]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 73, Number 174 (Monday, September 8, 2008)]
[Notices]
[Pages 52021-52024]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-20748]


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DEPARTMENT OF COMMERCE

International Trade Administration

A-570-506


Porcelain-on-Steel Cooking Ware from the People's Republic of 
China: Notice of Preliminary Results of Antidumping Duty Administrative 
Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') is conducting 
an administrative review of the antidumping duty order on porcelain-on-
steel cooking ware from the People's Republic of China (``PRC'') 
covering the period December 1, 2006, to November 30, 2007. The 
Department has preliminarily determined to apply adverse facts 
available to the PRC-wide entity, which includes Xiamen Songson Plastic 
Hardware Co., Ltd. (``Songson''), the only respondent in this review. 
If these preliminary results are adopted in the final results of this 
review, the Department will instruct U.S. Customs and Border Protection 
(``CBP'') to assess antidumping duties on entries of subject 
merchandise during the period of review (``POR''). Interested parties 
are invited to comment on these preliminary results. See the 
``Preliminary Results of Review'' section of this notice.

EFFECTIVE DATE: September 8, 2008.

FOR FURTHER INFORMATION CONTACT: Toni Dach or Scot Fullerton, AD/CVD 
Operations, Import Administration, International Trade Administration, 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230; telephone: (202) 482-1655 or (202) 482-1386, 
respectively.

SUPPLEMENTARY INFORMATION:

Background

    In response to a request from Columbian Home Products, LLC 
(``petitioner'') and OXO International Ltd., an importer of the subject 
merchandise, the Department of Commerce (the ``Department'') initiated 
an administrative review of Songson's exports of merchandise covered by 
the antidumping duty order on porcelain-on-steel cooking ware from the 
PRC. See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Request for Revocation in Part, 73 FR 4829 
(January 28, 2008) (``Initiation Notice'').
    On January 31, 2008, the Department issued its sections A, C and D 
antidumping duty questionnaire to Songson. The section A response was 
due on February 21, 2008, and the sections C and D response, as well as 
U.S. sales and factors of production (``FOP'') reconciliations, were 
due on March 10, 2008. On February 19, 2008, Songson requested an 
extension, until March 6, 2008, to file its section A response, and 
until March 24, 2008, to submit its sections C and D responses. On 
February 20, 2008, the Department granted Songson's extension request. 
We received the company's response to section A via regular mail on 
March 6, 2008. On March 14, 2008, the Department rejected Songson's 
section A response, as it was not filed in accordance with the 
Department's regulations. See Letter from the Department of Commerce to 
Xiamen Songson Plastic Hardware Co., Ltd., Re: Rejection of Section A 
Questionnaire Response (March 14, 2008). We granted Songson a second 
opportunity to file a complete section A response, and Songson 
submitted its revised section A response on March 28, 2008 (``Songson 
section A response''). Songson did not submit its sections C and D 
responses, or the required sales and FOP reconciliations by the 
extended due date, or on any date thereafter.

Period of Review

    The POR is December 1, 2006, through November 30, 2007.

Scope of Order

    The merchandise covered by this order is porcelain-on-steel cooking 
ware from the PRC, including tea kettles, which do not have self-
contained electric heating elements. All of the foregoing are 
constructed of steel and are enameled or glazed with vitreous glasses. 
The merchandise is currently classifiable under the United States 
Harmonized Tariff Schedule (``USHTS'') item 7323.94.00. USHTS item 
numbers are provided for convenience and customs purposes. The written 
description of the scope remains dispositive.

Non-Market-Economy Country

    The Department considers the PRC to be a non-market economy 
(``NME'') country. See, e.g., Preliminary Determination of Sales at 
Less Than Fair Value and Postponement of Final Determination: Coated 
Free Sheet Paper from the People's Republic of China, 72 FR 30758, 
30760 (June 4, 2007), unchanged in Final Determination of Sales at Less 
Than Fair Value: Coated Free Sheet Paper from the People's Republic of 
China, 72 FR 60632 (October 25, 2007). In accordance with section 
771(18)(C)(i) of the Act, any determination that a foreign country is 
an NME country shall remain in effect until revoked by the 
administering authority. No party has challenged the designation of the 
PRC as an NME country in this investigation. Therefore, we continue to 
treat the PRC as an NME country for purposes of this preliminary 
determination.

Separate Rates

    A designation of a country as an NME remains in effect until it is 
revoked by the Department. See section 771(18)(C)(i) of the Act. 
Accordingly, there is a rebuttable presumption that all companies 
within the PRC are subject to government control and, thus, should be 
assessed a single antidumping duty rate. It is the Department's 
standard policy to assign all exporters of the merchandise subject to 
review in NME countries a single rate unless an exporter can 
affirmatively demonstrate an absence of government control, both in law 
(de jure) and in fact (de facto), with respect to exports.
    To establish whether a company operating in a non-market economy 
country (``NME'') is sufficiently independent from government control 
to be entitled to a separate rate, the Department analyzes each 
exporting entity under the test established in the Final Determination 
of Sales at Less Than Fair Value: Sparklers from the People's Republic 
of China, 56 FR 20588 (May 6, 1991), as amplified by the Final 
Determination of Sales at Less Than Fair Value: Silicon Carbide from 
the People's Republic of China, 59 FR 22585 (May 2, 1994). Under the 
separate rates criteria, the Department assigns separate rates in NME 
cases only if the respondent can demonstrate the absence of both de 
jure and de facto governmental control over export activities.

[[Page 52022]]

De Jure Control

    Evidence supporting, though not requiring, a finding of absence of 
de jure government control over export activities includes: (1) an 
absence of restrictive stipulations associated with an individual 
exporter's business and export licenses; (2) any legislative enactments 
decentralizing control of companies; and (3) any other formal measures 
by the government decentralizing control of companies.
    As evidence of the absence of de jure government control over 
Songson's export activities, the Department requested that Songson 
provide any legislative enactments or other formal measures by the 
government that centralize or decentralize control of its export 
activities. In response, Songson responded ``N/A'' and did not provide 
the required laws applicable to Songson's export activities. See 
Songson section A response at 8. In addition, the Department requested 
that Songson describe the licensing process, provide the dates of any 
license applications, as well as all copies of paperwork and proposals 
submitted to government authorities regarding the license. Although 
Songson provided the Department with a copy of its approved business 
license, it did not provide any of the additional requested information 
noted above. See Id. Therefore, based on the record evidence, the 
Department cannot determine that there is an absence of de jure control 
over the export activities of Songson.

De Facto Control

    A determination of absence of de facto government control over 
exports is based on the following four factors: (1) whether the 
exporter sets its own export prices independently of the government and 
without the approval of a government authority; (2) whether the 
exporter retains the proceeds from its sales and makes independent 
decisions regarding the disposition of profits or financing of losses; 
(3) whether the exporter has the authority to negotiate and sign 
contracts and other agreements; and (4) whether the exporter has 
autonomy from the government regarding the selection of management. See 
e.g. Final Determination of Sales at Less than Fair Value: Certain Cut-
to-Length Carbon Steel Plate from Ukraine, 62 FR 61754, 61758 (November 
19, 1997).
    Songson asserted that it: (1) it establishes its own export prices; 
(2) negotiates contracts without guidance from any governmental 
entities or organizations; (3) makes its own personnel decisions; and 
(4) retains the proceeds of its export sales, uses profits according to 
its business needs, and has the authority to sell its assets and to 
obtain loans. See Songson section A response. However, Songson did not 
provide the Department with adequate information or documentation to 
support these claims in order to demonstrate that the company is not 
under the de facto control of the PRC government with respect to its 
export activities. For example, although the Department requested in 
its section A questionnaire that Songson provide evidence of price 
negotiations for its POR sales, Songson did not provide this requested 
documentation, and provided no explanation as to why it did not do so. 
See Id. at 9-10. In addition, although the Department requested that 
Songson describe how it negotiates sales to the United States, it 
provided no such description of its sales negotiations. See Id. at 14. 
The Department also requested that Songson describe how its management 
is selected. Although Songson stated that its general manager was 
appointed ``by the board meeting,'' it provided no description of who 
selects its other managers, and provided no description of how the 
board selects the general manager. See Id. at 10. In addition, Songson 
has asserted that it established its own export prices. However, in 
response to the Department's request for a description of the process 
by which Songson sets prices with its U.S. customers, Songson replied 
``N/A.'' See Id. at 9-10.
    Because we have been unable to fully analyze the level of de facto 
control over Songson's export activities due to the numerous 
deficiencies in Songson's Section A response, the Department concludes 
that the company has not satisfactorily demonstrated the absence of de 
facto control by the PRC government. Therefore, the Department has 
determined that Songson has not demonstrated that it qualifies for a 
separate rate. Because Songson did not demonstrate its eligibility for 
a separate rate, we have preliminarily determined that it is part of 
the PRC-wide entity. In the initiation notice, the Department stated 
that if one of the companies that we initiated a review on does not 
qualify for a separate rate, all other exporters of porcelain-on-steel 
cooking ware from the PRC who have not qualified for a separate rate 
are deemed to be covered by this review as part of the single PRC-wide 
entity, of which the named exporter is a part. See Initiation Notice at 
footnote 6. As a result, we determine that it is necessary to review 
the PRC-wide entity, including Songson, in this segment of the 
proceeding.

Application of Adverse Facts Available

    As discussed below, we find that it is appropriate to apply facts 
otherwise available on the record to the PRC-wide entity pursuant to 
section 776(a) of the Act. Section 776(a)(2) of the Act provides that, 
if an interested party: (A) withholds information that has been 
requested by the Department; (B) fails to provide such information in a 
timely manner or in the form or manner requested subject to sections 
782(c)(1) and (e) of the Act; (C) significantly impedes a proceeding 
under the antidumping statute; or (D) provides such information, but 
the information cannot be verified, the Department shall, subject to 
section 782(d) of the Act, use facts otherwise available in reaching 
the determination. In the instant case, Songson, which is part of the 
PRC-wide entity, has withheld information by not providing (1) capital 
verification reports, see Songson section A response at 3.f.; (2) a 
description of the process by which it sets prices with its U.S. 
customers, see Songson section A response at 4.h.; (3) a description, 
and copies of, its agreements for sales to the U.S., see Songson 
section A response at 4.c.; (4) a description of the companies 
accounting and financial reporting practices, see Songson section A 
response at 5.a.; (5) a chart of accounts, see Songson section A 
response at 5.b.; (6) a description of the licensing process, or copies 
of paperwork and proposals submitted to the government in order to 
obtain a business license, see Songson section A response at 2.e.(iv); 
and (7) sales or FOP reconciliations as requested at Appendix V of the 
Department's questionnaire. The Department requires this information to 
evaluate U.S. sales and FOP reconciliations, as well as the nature and 
extent of a respondent's affiliations, which may impact the way export 
sales are treated in the calculation of a dumping margin. In addition, 
Songson did not provide a section C and D questionnaire response, which 
the Department requires to calculate a dumping margin. As the 
Department was not provided with this information, we have no 
information with which to calculate an antidumping duty margin. 
Therefore, the Department finds that facts available pursuant to 
sections 776(a)(2)(A) and (C) of the Act is warranted for the PRC-wide 
entity, including Songson, as Songson has withheld the information 
noted above that was requested by the Department, and has significantly 
impeded the proceeding by not providing

[[Page 52023]]

information necessary to complete this administrative review.
    Section 776(b) of the Act provides that if the Department 
determines that a party has failed to cooperate to the best of its 
ability, in selecting from among the facts available, the Department 
may use an inference that is adverse to the interests of that party. As 
noted above, Songson did not provide the Department with a complete 
section A response or a sections C and D questionnaire response. 
Therefore, by failing to provide the necessary information within its 
possession, the PRC-wide entity, including Songson, has failed to 
cooperate to the best of its ability, and we find it appropriate 
pursuant to sections 776(a)(2) and 776(b) of the Act, to apply total 
AFA to the PRC-wide entity for these preliminary results.

Selection of AFA Rate

    In deciding which facts to use as AFA, section 776(b) of the Act 
and 19 CFR 351.308(c)(1) authorize the Department to rely on 
information derived from: (1) the petition; (2) a final determination 
in the investigation; (3) any previous review or determination; or (4) 
any information placed on the record. In reviews, it is the 
Department's practice to select, as AFA, the highest rate determined 
for any respondent in any segment of the proceeding. See, e.g., 
Freshwater Crawfish Tail Meat from the People's Republic of China; 
Notice of Final Results of Antidumping Duty Administrative Review, 68 
FR 19504, 19506 (April 21, 2003).
    The Court of International Trade (``CIT'') and the Federal Circuit 
have consistently upheld the Department's practice. See Rhone Poulenc, 
Inc. v. United States, 899 F.2d 1185, 1190 (Fed. Cir. 1990) (``Rhone 
Poulenc''); NSK Ltd. v. United States, 346 F. Supp. 2d 1312, 1335 (Ct. 
Int'l Trade 2004) (upholding a 73.55% total AFA rate, the highest 
available dumping margin from a different respondent in a less than 
fair value investigation); see also Kompass Food Trading Int'l v. 
United States, 24 CIT 678, 689 (2000) (upholding a 51.16% total AFA 
rate, the highest available dumping margin from a different, fully 
cooperative respondent); and Shanghai Taoen International Trading Co., 
Ltd. v. United States, 360 F. Supp. 2d 1339 (CIT February 17, 2005) 
(upholding a 223.01 percent total AFA rate, the highest available 
dumping margin from a different respondent in a previous administrative 
review).
    The Department's practice when selecting an adverse rate from among 
the possible sources of information is to ensure that the margin is 
sufficiently adverse ``as to effectuate the purpose of the facts 
available role to induce respondents to provide the Department with 
complete and accurate information in a timely manner.'' See Static 
Random Access Memory Semiconductors from Taiwan; Final Determination of 
Sales at Less than Fair Value, 63 FR 8909, 8932 (February 23, 1998). 
The Department's practice also ensures Athat the party does not obtain 
a more favorable result by failing to cooperate than if it had 
cooperated fully.@ See Statement of Administrative Action (``SAA'') 
accompanying the URAA, H.R. Rep. No. 103-316 at 870 (1994). See also 
Final Determination of Sales at Less than Fair Value: Certain Frozen 
and Canned Warmwater Shrimp from Brazil, 69 FR 76910 (December 23, 
2004); see also D&L Supply Co. v. United States, 113 F.3d 1220, 1223 
(Fed. Cir. 1997). In choosing the appropriate balance between providing 
respondents with an incentive to respond accurately and imposing a rate 
that is reasonably related to the respondent's prior commercial 
activity, selecting the highest prior margin reflects a common sense 
inference that the highest prior margin is the most probative evidence 
of current margins, because, if it were not so, the respondent, knowing 
of the rule, would have produced current information showing the margin 
to be less. Rhone Poulenc, 899 F.2d at 1190.
    Consistent with section 776(b)(3) of the Act, court precedent, and 
its practice, the Department has assigned the rate of 66.65 percent, 
calculated in the less-than-fair-value investigation,\1\ the highest 
rate assigned in any segment of the proceeding, to the PRC-wide entity, 
including Songson, as AFA. See, e.g., Brake Rotors from the People=s 
Republic of China: Rescission of Second New Shipper Review and Final 
Results and Partial Rescission of First Antidumping Duty Administrative 
Review, 64 FR 61581, 61584 (November 12, 1999). As discussed further 
below, this rate has been corroborated.
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    \1\ See Porcelain-on-Steel Cooking Ware from the People's 
Republic of China; Final Determination of Sales at Less Than Fair 
Value, 51 FR 36419 (October 10, 1986).
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Corroboration of Secondary Information Used as AFA

    Section 776(c) of the Act provides that when the Department selects 
from among the facts otherwise available and relies on ``secondary 
information,'' the Department shall, to the extent practicable, 
corroborate that information from independent sources reasonably at the 
Department's disposal. The SAA states that ``corroborate'' means to 
determine that the information used has probative value. See SAA at 
870. The Department has determined that to have probative value, 
information must be reliable and relevant. See Certain Tissue Paper 
Products from the People's Republic of China: Final Results and Final 
Rescission, In Part, of Antidumping Duty Administrative Review, 72 FR 
58642 (October 16, 2007) and accompanying Issues and Decision 
Memorandum at Comment 6. The SAA also states that independent sources 
used to corroborate such evidence may include, for example, published 
price lists, official import statistics and customs data, and 
information obtained from interested parties during the particular 
investigation. See SAA at 870; see also Final Determination of Sales at 
Less Than Fair Value: Live Swine from Canada, 70 FR 12181, 12184 (March 
11, 2005).
    To be considered corroborated, information must be found to be both 
reliable and relevant. Unlike other types of information, such as input 
costs or selling expenses, there are no independent sources for 
calculated dumping margins. The only sources for calculated margins are 
administrative determinations. The AFA rate we are applying in the 
current review was calculated during the Less Than Fair Value 
Investigation. See Porcelain-on-Steel Cooking Ware from the People's 
Republic of China; Final Determination of Sales at Less Than Fair 
Value, 51 FR 36419 (October 10, 1986) (``LTFV Investigation''). The 
Department corroborated the information used to calculate the 66.65 
percent rate in the LTFV investigation, finding the rate to be both 
reliable and relevant. Furthermore, the AFA rate we are applying for 
the current review was applied in reviews subsequent to the LTFV 
Investigation and the Department received no information that warranted 
revisiting the issue. See, e.g., Porcelain-on-Steel Cooking Ware from 
the People's Republic of China: Notice of Final Results of Antidumping 
Duty Administrative Review, 71 FR 24641 (April 26, 2006). No 
information has been presented in the current review that calls into 
question the reliability of this information. Thus, the Department 
finds that the information is reliable.
    With respect to the relevance aspect of corroboration, the 
Department will consider information reasonably at its disposal to 
determine whether a margin continues to have relevance. Where 
circumstances indicate that the selected margin is not appropriate as 
AFA, the Department will disregard the margin and determine an 
appropriate margin. See Fresh Cut Flowers from Mexico:

[[Page 52024]]

Final Results of Antidumping Duty Administrative Review, 61 FR 6812 
(February 22, 1996), (where the Department disregarded the highest 
margin in that case as adverse best information available (the 
predecessor to facts available) because the margin was based on another 
company's uncharacteristic business expense, resulting in an unusually 
high margin). Similarly, the Department does not apply a margin that 
has been discredited. See D & L Supply Co. v. United States, 113 F.3d 
1220, 1221 (Fed. Cir. 1997) (the Department will not use a margin that 
has been judicially invalidated). There is no information reasonably 
available at our disposal in this review to corroborate the relevance 
of the AFA rate in question, which, as discussed above, was last 
corroborated in the LTFV Investigation. We cannot use the margin 
calculations of other companies because there are no other respondents 
in this review. Therefore, because there is no record evidence calling 
into question the relevance of the selected AFA rate, we find that it 
is relevant for use in this administrative review.
    Because the AFA rate, 66.65 percent, is both reliable and relevant, 
we determine that it has probative value. As a result, the Department 
determines that the 66.65 percent rate is corroborated for the purposes 
of this administrative review and may reasonably be applied to the PRC-
wide entity, as AFA.

Preliminary Results of the Review

    The Department preliminarily finds that the following margins exist 
for the following exporters under review during the period December 1, 
2006, through November 30, 2007:

              Porcelain-on-Steel Cooking Ware from the PRC
------------------------------------------------------------------------
                                                       Weighted-Average
                Manufacturer/Exporter                  Margin (Percent)
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PRC-Wide Entity (which includes Xiamen Songson                     66.65
 Plastic Hardware Co., Ltd.)........................
------------------------------------------------------------------------

    Any interested party may request a hearing within 30 days of 
publication of this notice. 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 date of 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 discussed. See 
19 CFR 351.310(c).
    Issues raised in the hearing will be limited to those raised in 
case and rebuttal briefs. Case briefs from interested parties may be 
submitted not later than 30 days of the date of publication of this 
notice, pursuant to 19 CFR 351.309(c). Rebuttal briefs, limited to 
issues raised in the case briefs, will be due five days later, pursuant 
to 19 CFR 351.309(d). Parties who submit case or rebuttal briefs in 
this proceeding are requested to submit with each argument (1) a 
statement of the issue and (2) a brief summary of the argument. Parties 
are also encouraged to provide a summary of the arguments not to exceed 
five pages and a table of statutes, regulations, and cases cited.
    The Department will issue the final results of this administrative 
review, including the results of its analysis of issues raised in any 
such written briefs or at the hearing, if held, no later than 120 days 
after the date of publication of this notice, pursuant to section 
751(a)(3)(A) of the Act.

Assessment of Antidumping Duties

    The Department will determine, and CBP shall assess, antidumping 
duties on all appropriate entries. 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. If these 
preliminary results are adopted in our final results of the review, we 
will direct CBP to assess the resulting rate against the entered 
customs value for the subject merchandise on each importer's/customer's 
entries during the POR, as appropriate.

Cash Deposit Requirements

    The following cash-deposit requirements will be effective upon 
publication of the final results for shipments of the subject 
merchandise entered, or withdrawn from warehouse, for consumption on or 
after the publication date of the final results, as provided by section 
751(a)(2)(C) of the Act: (1) for subject merchandise exported by the 
PRC, including Songson, the cash-deposit rate will be equal to 66.65 
percent; (2) the cash-deposit rate for PRC exporters who received a 
separate rate in a prior segment of the proceeding will continue to be 
the rate assigned in that segment of the proceeding; (3) for all other 
PRC exporters of subject merchandise which have not been found to be 
entitled to a separate rate, the cash-deposit rate will be the PRC-wide 
rate of 66.65 percent; (4) for all non-PRC exporters of subject 
merchandise, the cash-deposit rate will be the rate applicable to the 
PRC exporter that supplied that exporter.
    These deposit requirements, when imposed, shall remain in effect 
until publication of the final results of the next administrative 
review.

Notification to Importers

    This notice 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.
    This administrative review and notice is in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.221(b)(4).

    Dated: September 2, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E8-20748 Filed 9-5-08; 8:45 am]
BILLING CODE 3510-DS-S