Frontseating Service Valves from the People's Republic of China: Preliminary Determination of Sales at Less Than Fair Value, Preliminary Negative Determination of Critical Circumstances, and Postponement of Final Determination, 62952-62961 [E8-25178]
Download as PDF
<![CDATA[
62952
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
sroberts on PROD1PC70 with NOTICES
Division; Telephone: 202–482–2440; email: semme@bis.doc.gov.
Status: This meeting will be open to
the public. A limited number of seats
will be available for the meeting.
Reservations are not accepted. The
meeting will be accessible via
teleconference to 20 participants on a
first come, first served basis. To join the
meeting, submit inquiries to Yvette
Springer at yspringer@bis.doc.gov no
later than October 23, 2008.
SUPPLEMENTARY INFORMATION:
Background
On January 22, 2008, the President
announced a package of directives to
ensure that the export control policies
and practices of the United States
support the National Security Strategy
of 2006, while facilitating the United
States’ continued international
economic and technological leadership.
In addition, the Deemed Export
Advisory Committee (DEAC) recently
undertook a comprehensive
examination of the national security,
technology, and competitiveness aspects
of the deemed export rule and presented
its findings to the Secretary of
Commerce in December 2007. The
DEAC concluded that the deemed
export rule, ‘‘no longer effectively serves
its intended purpose and should be
replaced with an approach that better
reflects the realities of today’s national
security needs and global economy.’’
Among its recommendations, the DEAC
proposed that BIS create a category of
‘‘Trusted Entities’’ that voluntarily elect
to qualify for streamlined treatment after
meeting certain criteria. Further, the
DEAC recommended that these
‘‘Trusted Entities’’ include subsidiaries
located abroad so that individuals and
ideas could move within the company
structure without the need for separate
deemed export licenses.
In response to the President’s
directives on U.S. export control
reforms and the DEAC’s
recommendations on deemed export
controls, BIS published a proposed rule
that would create a license exception for
intra-company transfers.
The proposed rule would amend the
Export Administration Regulations
(EAR) to establish a new license
exception entitled ‘‘Intra-Company
Transfer (ICT).’’ Pursuant to ICT, an
approved parent company and its
approved wholly-owned or controlled
in fact entities to export, reexport, or
transfer (in-country) many items on the
Commerce Control List among
themselves for internal company use.
Prior authorization from BIS would be
required to use the license exception,
and certain terms and conditions would
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
apply. The proposed rule describes the
criteria pursuant to which entities
would be eligible to use License
Exception ICT and the procedure by
which they must apply for ICT
authorization.
The purpose of the public meeting is
for U.S. Government officials to explain
the amendments to the EAR proposed in
the rule and answer questions from the
public. This effort is intended to assist
the public submit helpful comments on
the rule to BIS by the November 17,
2008 deadline.
Dated: October 16, 2008.
Christopher R. Wall,
Assistant Secretary for Export
Administration.
[FR Doc. E8–25180 Filed 10–21–08; 8:45 am]
BILLING CODE 3510–33–P
DEPARTMENT OF COMMERCE
International Trade Administration
A–570–933
Frontseating Service Valves from the
People’s Republic of China:
Preliminary Determination of Sales at
Less Than Fair Value, Preliminary
Negative Determination of Critical
Circumstances, and Postponement of
Final Determination
Import Administration,
International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: October 22, 2008.
SUMMARY: We preliminarily determine
that frontseating service valves (‘‘FSVs’’)
from the People’s Republic of China
(‘‘PRC’’) are being, or are likely to be,
sold in the United States at less than fair
value (‘‘LTFV’’), as provided in section
733 of the Tariff Act of 1930, as
amended (‘‘the Act’’). The estimated
margins of sales at LTFV are shown in
the ‘‘Preliminary Determination’’
section of this notice. Pursuant to a
request from an interested party, we are
postponing the final determination and
extending the provisional measures
from a four-month period to not more
than six months. Accordingly, we will
make our final determination not later
than 135 days after publication of the
preliminary determination. See the
‘‘Postponement of the Final
Determination’’ section below.
FOR FURTHER INFORMATION CONTACT:
Eugene Degnan or Robert Bolling, AD/
CVD Operations, Office 8, Import
Administration, International Trade
Administration, U.S. Department of
Commerce, 14th Street and Constitution
Avenue, NW, Washington, DC, 20230;
AGENCY:
PO 00000
Frm 00004
Fmt 4703
Sfmt 4703
telephone: (202) 482–0414 or 482–3434,
respectively.
SUPPLEMENTARY INFORMATION:
Initiation
On March 19, 2008, Parker–Hannifin
Corporation (‘‘Petitioner’’) filed an
antidumping petition in proper form on
behalf of the domestic industry
concerning imports of FSVs from the
PRC (‘‘Petition’’). The Department of
Commerce (‘‘the Department’’) initiated
this investigation on April 15, 2008.1 In
the Initiation Notice, the Department
notified parties of the application
process by which exporters and
producers may obtain separate–rate
status in non–market economy (‘‘NME’’)
investigations. The process requires
exporters and producers to submit a
separate–rate status application
(‘‘SRA’’).2 However, the standard for
eligibility for a separate rate (which is
whether a firm can demonstrate an
absence of both de jure and de facto
government control over its export
activities) has not changed. The SRA for
this investigation was posted on the
Department’s website on April 10, 2008,
at https://ia.ita.doc.gov/ia–highlightsand–news.html. The due date for filing
an SRA was June 16, 2008. No party
beyond the mandatory respondents filed
an SRA.
On May 12, 2008, the International
Trade Commission (‘‘ITC’’)
preliminarily determined that there is a
reasonable indication that an industry
in the United States is materially
injured or threatened with material
injury by reason of imports of FSVs
from the PRC.3
Period of Investigation
The period of investigation (‘‘POI’’) is
July 1, 2007, through December 31,
2007. This period corresponds to the
two most recent fiscal quarters prior to
the month of the filing of the petition,
which was March 19, 2008.4
Postponement of Preliminary
Determination
On July 30, 2008, Petitioner made a
timely request, pursuant to section
1 See Frontseating Service Valves from the
People’s Republic of China: Notice of Initiation of
Antidumping Duty Investigation, 73 FR 20250
(April 15, 2008) (‘‘Initiation Notice’’).
2 See Policy Bulletin 05.1: Separate-Rates Practice
and Application of Combination Rates in
Antidumping Investigations involving Non-Market
Economy Countries (April 5, 2005) (‘‘Policy Bulletin
05.1’’), available at https://ia.ita.doc.gov/policy/
bull05-1.pdf.
3 See Investigation Nos. 731-TA-1148
(Preliminary): Frontseating Service Valves from
China, 73 FR 28507 (May 16, 2008) (‘‘ITC
Preliminary Determination’’).
4 See 19 CFR 351.204(b)(1).
E:\FR\FM\22OCN1.SGM
22OCN1
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
733(c)(1)(A) of the Act and 19 CFR
351.205(b)(2) and (e), for a 50-day
postponement of the preliminary
determination. On August 11, 2008, the
Department published a postponement
of the preliminary antidumping duty
determination on FSVs from the PRC.5
Postponement of Final Determination
and Extension of Provisional Measures
On October 7 2008, Zhejiang Sanhua
Co., Ltd. (‘‘Sanhua’’) made a timely
request pursuant to section 735(a)(2)(A)
of the Act and 19 CFR 351.210(b)(2)(ii)
that the Department postpone the final
determination and extend the
provisional measures from a four-month
period to not more than six months in
duration. We are granting Sanhua’s
request in accordance with section
733(a)(2)(A) of the Act and 19 CFR
351.210(b)(2)(ii).
Scope of Investigation
sroberts on PROD1PC70 with NOTICES
The merchandise covered by this
investigation is frontseating service
valves, assembled or unassembled,
complete or incomplete, and certain
parts thereof. Frontseating service
valves contain a sealing surface on the
front side of the valve stem that allows
the indoor unit or outdoor unit to be
isolated from the refrigerant stream
when the air conditioning or
refrigeration unit is being serviced.
Frontseating service valves rely on an
elastomer seal when the stem cap is
removed for servicing and the stem cap
metal to metal seat to create this seal to
the atmosphere during normal
operation.6
For purposes of the scope, the term
‘‘unassembled’’ frontseating service
valve means a brazed subassembly
requiring any one or more of the
following processes: the insertion of a
valve core pin, the insertion of a valve
stem and/or O ring, the application or
installation of a stem cap, charge port
cap or tube dust cap. The term
‘‘complete’’ frontseating service valve
means a product sold ready for
installation into an air conditioning or
refrigeration unit. The term
‘‘incomplete’’ frontseating service valve
means a product that when sold is in
5 See Postponement of Preliminary Determination
of Antidumping Duty Investigation: Frontseating
Service Valves from the People’s Republic of China,
73 FR 46586 (August 11, 2008).
6 The frontseating service valve differs from a
backseating service valve in that a backseating
service valve has two sealing surfaces on the valve
stem. This difference typically incorporates a valve
stem on a backseating service valve to be machined
of steel, where an frontseating service valve has a
brass stem. The backseating service valve dual stem
seal (on the back side of the stem), creates a metal
to metal seal when the valve is in the open position,
thus, sealing the stem from the atmosphere.
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
multiple pieces, sections, subassemblies
or components and is incapable of being
installed into an air conditioning or
refrigeration unit as a single, unified
valve without further assembly.
The major parts or components of
frontseating service valves intended to
be covered by the scope under the term
‘‘certain parts thereof’’ are any brazed
subassembly consisting of any two or
more of the following components: a
valve body, field connection tube,
factory connection tube or valve charge
port. The valve body is a rectangular
block, or brass forging, machined to be
hollow in the interior, with a generally
square shaped seat (bottom of body).
The field connection tube and factory
connection tube consist of copper or
other metallic tubing, cut to length,
shaped and brazed to the valve body in
order to create two ports, the factory
connection tube and the field
connection tube, each on opposite sides
of the valve assembly body. The valve
charge port is a service port via which
a hose connection can be used to charge
or evacuate the refrigerant medium or to
monitor the system pressure for
diagnostic purposes.
The scope includes frontseating
service valves of any size, configuration,
material composition or connection
type. Frontseating service valves are
classified under subheading
8481.80.1095, and also have been
classified under subheading
8415.90.80.85, of the Harmonized Tariff
Schedule of the United States
(‘‘HTSUS’’). It is possible for
frontseating service valves to be
manufactured out of primary materials
other than copper and brass, in which
case they would be classified under
HTSUS subheadings 8481.80.3040,
8481.80.3090, or 8481.80.5090. In
addition, if unassembled or incomplete
frontseating service valves are imported,
the various parts or components would
be classified under HTSUS subheadings
8481.90.1000, 8481.90.3000, or
8481.90.5000. The HTSUS subheadings
are provided for convenience and
customs purposes, but the written
description of the scope is dispositive.
Scope Comments
We set aside a period for interested
parties to raise issues regarding product
coverage. See Antidumping Duties;
Countervailing Duties; Final Rule, 62 FR
27296, 27323 (May 19, 1997). In our
Initiation Notice, we encouraged parties
to submit such comments regarding the
scope of the merchandise under
investigation by April 28, 2008. On
April 28, 2008, Sanhua submitted scope
comments. No other party submitted
scope comments. On May 8, 2008,
PO 00000
Frm 00005
Fmt 4703
Sfmt 4703
62953
Petitioner submitted rebuttal scope
comments. No other party submitted
rebuttal comments. Sanhua requested
that the Department limit the scope to
FSVs made of brass or copper and not
include forged products with integrated
feet because the scope as written covers
too broad a range of service valves.
Sanhua argues that service valves may
erroneously be classified as FSVs when
they enter the United States under the
current scope description. Specifically,
Sanhua contends that the scope as
written currently suggests that FSVs are
made of any material. Sanhua argues
that, in fact, FSVs must stand up to
certain operating conditions and brass
FSVs are the only product that meet
those conditions and demands.
Petitioner argues that the Department
should not consider any changes that
would limit the scope to specific
material composition, mounting type or
that would attempt to remove all forged
valve bodies from the scope.
In the Initiation Notice,7 we stated
that the scope of merchandise includes
FSVs of any size, configuration, material
composition or connection type. FSVs
are classified under subheading
8481.80.1095, and also have been
classified under subheading
8415.90.80.85 of the HTSUS.
Additionally, we stated that it is
possible for FSVs to be manufactured
out of primary materials other than
copper and brass, in which case they
would be classified under HTSUS
subheadings 8481.80.3040,
8481.80.3090, or 8481.80.5090. Based
upon the above, we have preliminarily
determined that the scope of the
merchandise under consideration as it is
currently written clearly describes the
scope of the merchandise under
consideration.
Non–Market Economy Country
For purposes of initiation, Petitioner
submitted an LTFV analysis for the PRC
as an NME.8 Recently, the Department
examined the PRC’s market status and
determined that NME status should
continue for the PRC.9 Additionally, in
recent investigations, the Department
also treated the PRC as an NME
country.10 In accordance with section
7 See
Initiation Notice, 73 FR at 20251.
Initiation Notice, 73 FR at 20253.
9 See the Department’s memorandum entitled,
‘‘Antidumping Duty Investigation of Certain Lined
Paper Products from the People’s Republic of China
(‘‘China’’)-China’s status as a non-market economy
(‘‘NME’’),’’ dated August 30, 2006. This document
is available online at: https:// ia.ita.doc.gov/
download/prc-nmestatus/ prc-lined-paper-memo08302006.pdf.
10 See Electrolytic Manganese Dioxide from the
People’s Republic of China: Final Determination of
8 See
E:\FR\FM\22OCN1.SGM
Continued
22OCN1
62954
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
771(18)(C)(i) of the Act, the NME status
remains in effect until revoked by the
Department. The presumption of the
NME status of the PRC has not been
revoked by the Department and,
therefore, remains in effect for purposes
of this investigation.
Selection of Respondents
The Department issued its Quantity
and Value (‘‘Q&V’’) questionnaire to
Zhejiang DunAnn Hetian Metal Co., Ltd.
(‘‘DunAn’’), Sanhua, and Anhui Tianda
Group, Ltd. (‘‘Tianda’’), exporters of
FSVs from the PRC. In its Q&V
questionnaire the Department requested
that the firms provide a response on
May 8, 2008. On May 8, 2008, DunAn
and Sanhua each submitted a Q&V
questionnaire response. Both DunAn
and Sanhua stated that they exported
FSV’s to the United States during the
POI. The Department did not receive a
Q&V response from Tianda. On June 30,
2008, the Department selected DunAn
and Sanhua as mandatory respondents
and issued an antidumping duty
questionnaire to both companies.
Surrogate Country
sroberts on PROD1PC70 with NOTICES
Section 773(c)(1) of the Act directs the
Department to base normal value
(‘‘NV’’) on the NME producer’s factors
of production (‘‘FOPs’’), valued in a
surrogate market economy (‘‘ME’’)
country or countries considered to be
appropriate by the Department. In
accordance with section 773(c)(4) of the
Act, in valuing the FOPs, the
Department shall use, to the extent
possible, the prices or costs of the FOPs
in one or more ME countries that are: (1)
at a level of economic development
comparable to that of the NME country;
and (2) significant producers of
comparable merchandise. The sources
of the surrogate factor values are
discussed under the ‘‘Factor
Valuations’’ section below. See also
Factor Valuation Memorandum.11
On September 10, 2008, the
Department determined that India,
Indonesia, Thailand, the Philippines,
and Colombia are countries comparable
to the PRC in terms of economic
development.12 On September 11, 2008,
Sales at Less Than Fair Value, 73 FR 48195 (August
18, 2008).
11 See the Department’s memorandum entitled,
‘‘Antidumping Duty Investigation of Frontseating
Service Valves from the People’s Republic of China:
Factor Valuations for the Preliminary
Determination,’’ dated concurrently with this notice
(‘‘Factor Valuation Memorandum’’).
12‘‘See the Department’s memorandum entitled,
‘‘Antidumping Duty Investigation of Frontseating
Service Valves (‘‘FSVs’’) from the People’s Republic
of China (‘‘PRC’’): Request for a List of Surrogate
Countries’’ from the office of Policy, dated
September 10, 2008 (identifying the list of potential
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
the Department requested comments on
the selection of a surrogate country from
the interested parties in this
investigation. Petitioner and DunAn
submitted comments on September 22,
2008. Both Petitioner and DunAn stated
the Department should select India as
the surrogate country.
The Department’s practice is to select
an appropriate surrogate country from
the Policy Memorandum based on the
availability and reliability of data from
the countries that are significant
producers of comparable merchandise.
In this case, we found that India is at a
level of economic development
comparable to that of the PRC, is a
significant producer of comparable
merchandise (i.e., FSVs) and has
publicly available and reliable data.
Accordingly, we selected India as the
primary surrogate country for purposes
of valuing the FOPs in the calculation
of NV because it meets the Department’s
criteria for surrogate country
selection.13 We obtained and relied
upon publicly available information
wherever possible.
In accordance with 19 CFR
351.301(c)(3)(i), for the final
determination in antidumping
investigations, interested parties may
submit publicly available information to
value FOPs under 19 CFR 351.408(c)
within 40 days after the date of
publication of this preliminary
determination.14
Separate Rates
In the Initiation Notice, the
Department notified parties of the recent
application process by which exporters
and producers may obtain separate–rate
status in NME investigations. See
Initiation Notice at 20254. The process
requires exporters and producers to
submit an SRA. See also Policy Bulletin
05.1.15 However, the standard for
surrogate countries comparable to the PRC in terms
of economic comparability) (‘‘Policy
Memorandum’’).
13‘‘See Id.
14 In accordance with 19 CFR 351.301(c)(1), for
the final determination of this investigation,
interested parties may submit factual information to
rebut, clarify, or correct factual information
submitted by an interested party less than ten days
before, on, or after, the applicable deadline for
submission of such factual information. However,
the Department notes that 19 CFR 351.301(c)(1)
permits new information only insofar as it rebuts,
clarifies, or corrects information recently placed on
the record. The Department generally cannot accept
the submission of additional, previously absentfrom-the-record alternative surrogate value
information pursuant to 19 CFR 351.301(c)(1). See
Glycine from the People’s Republic of China: Final
Results of Antidumping Duty Administrative
Review and Final Rescission, in Part, 72 FR 58809
(October 17, 2007) and accompanying Issues and
Decision Memorandum at Comment 2.
15 Policy Bulletin 05.1 states: ‘‘while continuing
the practice of assigning separate rates only to
PO 00000
Frm 00006
Fmt 4703
Sfmt 4703
eligibility for a separate rate (which is
whether a firm can demonstrate an
absence of both de jure and de facto
government control over its export
activities) has not changed.
In proceedings involving NME
countries, the Department has a
rebuttable presumption that all
companies within the country are
subject to government control and thus
should be assessed a single antidumping
duty rate. It is the Department’s policy
to assign all exporters of merchandise
subject to this investigation in an NME
country this single rate unless an
exporter can demonstrate that it is
sufficiently independent so as to be
entitled to a separate rate. See Policy
Bulletin 05.1. Exporters can demonstrate
this independence through the absence
of both de jure and de facto government
control over export activities. The
Department analyzes each entity
exporting the merchandise subject to
this investigation under a test arising
from the Notice of Final Determination
of Sales at Less Than Fair Value:
Sparklers from the People’s Republic of
China, 56 FR 20588 (May 6, 1991)
(‘‘Sparklers’’), as further developed in
Notice of Final Determination of Sales
at Less Than Fair Value: Silicon Carbide
from the People’s Republic of China, 59
FR 22585 (May 2, 1994) (‘‘Silicon
Carbide’’). However, if the Department
determines that a company is wholly
foreign–owned or located in an ME,
then a separate–rate analysis is not
necessary to determine whether it is
independent from government control.
A. Separate–Rate Recipients
In this investigation, no company
reported that it is wholly owned by
individuals or companies located in an
ME or that it is located outside the PRC.
Therefore, we are not addressing these
ownership structures in this preliminary
determination.
1. Joint Ventures between Chinese
and Foreign Companies or Wholly
Chinese–Owned Companies
exporters, all separate rates that the Department
will now assign in its NME investigations will be
specific to those producers that supplied the
exporter during the period of investigation. Note,
however, that one rate is calculated for the exporter
and all of the producers which supplied subject
merchandise to it during the period of investigation.
This practice applied both to mandatory
respondents receiving an individually calculated
separate rate as well as the pool of non-investigated
firms receiving the weighted-average of the
individually calculated rates. This practice is
referred to as the application of ‘‘combination rates’’
because such rates apply to specific combinations
of exporters and one or more producers. The cashdeposit rate assigned to an exporter will apply only
to merchandise both exported by the firm in
question and produced by a firm that supplied the
exporter during the period of investigation.’’ See
Policy Bulletin 05.1 at 6.
E:\FR\FM\22OCN1.SGM
22OCN1
sroberts on PROD1PC70 with NOTICES
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
In this investigation no company
reported that its ownership structure is
that of a wholly Chinese–owned
company. However, both respondents
examined (i.e., DunAn and Sanhua)
reported that they are joint ventures
between Chinese and foreign
companies. Therefore, the Department
must analyze whether DunAn and
Sanhua can demonstrate the absence of
both de jure and de facto government
control over their export activities.
a. Absence of De Jure Control
The Department considers the
following de jure criteria in determining
whether an individual company may be
granted a separate rate: (1) an absence of
restrictive stipulations associated with
an individual exporter’s business and
export licenses; (2) any legislative
enactments decentralizing control of
companies; and (3) other formal
measures by the government
decentralizing control of companies. See
Sparklers, 56 FR at 20589.
The evidence provided by DunAn and
Sanhua supports a preliminary finding
of de jure absence of government control
based on the following: (1) an absence
of restrictive stipulations associated
with the individual exporters’ business
and export licenses; (2) there are
applicable legislative enactments
decentralizing control of the companies;
and (3) there are formal measures by the
government decentralizing control of
companies. See, e.g., DunAn’s and
Sanhua’s SRA submissions dated June
17, 2008, and June 13, 2008,
respectively.
b. Absence of De Facto Control
Typically the Department considers
four factors in evaluating whether each
respondent is subject to de facto
government control of its export
functions: (1) whether the export prices
are set by or are subject to the approval
of a government agency; (2) whether the
respondent has authority to negotiate
and sign contracts and other
agreements; (3) whether the respondent
has autonomy from the government in
making decisions regarding the
selection of management; and (4)
whether the respondent retains the
proceeds of its export sales and makes
independent decisions regarding
disposition of profits or financing of
losses. See Silicon Carbide, 59 FR at
22586–87; see also Notice of Final
Determination of Sales at Less Than
Fair Value: Furfuryl Alcohol From the
People’s Republic of China, 60 FR
22544, 22545 (May 8, 1995). The
Department has determined that an
analysis of de facto control is critical in
determining whether respondents are,
in fact, subject to a degree of
government control which would
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
preclude the Department from assigning
separate rates.
The evidence placed on the record of
this investigation by DunAn and Sanhua
demonstrate an absence of de jure and
de facto government control with
respect to their respective exports of the
merchandise under investigation, in
accordance with the criteria identified
in Sparklers and Silicon Carbide.16
B. Companies Not Receiving a Separate
Rate
The Department has determined that
all parties applying for a separate rate in
this segment of the proceeding have
demonstrated an absence of government
control both in law and in fact (see
discussion above), and is, therefore, not
denying separate–rate status to any
respondent that has applied (i.e.,
DunAn and Sanhua).
Facts Available and the PRC–wide
Entity
Section 776(a)(1) and (2) of the Act
provides that the Department shall
apply ‘‘facts otherwise available’’ if
necessary information is not on the
record or an interested party or any
other person (A) withholds information
that has been requested, (B) fails to
provide information within the
deadlines established, or in the form
and manner requested by the
Department, subject to subsections (c)(1)
and (e) of section 782 of the Act, (C)
significantly impedes a proceeding, or
(D) provides information that cannot be
verified as provided by section 782(i) of
the Act.
Where the Department determines
that a response to a request for
information does not comply with the
request, section 782(d) of the Act
provides that the Department will so
inform the party submitting the
response and will, to the extent
practicable, provide that party the
opportunity to remedy or explain the
deficiency. If the party fails to remedy
the deficiency within the applicable
time limits, subject to section 782(e) of
the Act, the Department may disregard
all or part of the original and subsequent
responses, as appropriate. Pursuant to
section 782(e) of the Act, the
Department shall not decline to
consider submitted information if all of
the following requirements are met: (1)
The information is submitted by the
established deadline; (2) the information
can be verified; (3) the information is
not so incomplete that it cannot serve as
a reliable basis for reaching the
applicable determination; (4) the
16 See DunAn’s and Sunhua’s SRAs, dated June
13, 2008.
PO 00000
Frm 00007
Fmt 4703
Sfmt 4703
62955
interested party has demonstrated that it
acted to the best of its ability; and (5)
the information can be used without
undue difficulties.
On April 19, 2008, the Department
sent Tianda a Q&V questionnaire
requesting information on the quantity
and U.S. dollar sales value of all exports
of FSVs to the United States.17 A
response was due by close of business
on May 8, 2008. The Department did not
receive a response from Tianda.
We find that because Tianda failed to
respond to the Department’s requests for
information, it failed to demonstrate
that it operates free of government
control and that it is entitled to a
separate rate. Therefore, we are treating
Tianda as part of the PRC–wide entity.
Based on the above facts, the
Department preliminarily determines
that there were exports of the
merchandise subject to this
investigation from a PRC exporter/
producer that did not respond to the
Department’s Q&V questionnaire, and
section 776(b) of the Act provides that,
in selecting from among the facts
otherwise available, the Department
may employ an adverse inference if an
interested party fails to cooperate by not
acting to the best of its ability to comply
with requests for information. See
Statement of Administrative Action
accompanying the Uruguay Round
Agreements Act, H.R. Rep. No. 103–316,
870 (1994) (‘‘SAA’’). By failing to
respond to the Department’s Q&V
questionnaire, we preliminarily
determine that the PRC–wide entity did
not cooperate to the best of its ability.
Accordingly, we find that an adverse
inference is warranted for the PRC–wide
entity, which includes Tianda.
Selection of the Adverse Facts
Available Rate
In deciding which facts to use as
adverse facts available (‘‘AFA’’), section
776(b) of the Act and 19 CFR
351.308(c)(1) and (2) provide that the
Department may 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 selecting a rate for AFA, the
Department selects a rate that is
sufficiently adverse so ‘‘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.’’18 It is also the
17 See the Department’s letter to all interested
parties, dated April 19, 2008.
18 See Notice of Final Determination of Sales at
Less than Fair Value: Static Random Access
E:\FR\FM\22OCN1.SGM
Continued
22OCN1
62956
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
Department’s practice to select a rate
that ensures ‘‘that the party does not
obtain a more favorable result by failing
to cooperate than if it had cooperated
fully.’’19
Generally, the Department finds
selecting the highest rate in any segment
of the proceeding as AFA to be
appropriate.20 It is the Department’s
practice to select, as AFA, the higher of
the (a) highest margin alleged in the
petition, or (b) the highest calculated
rate of any respondent in the
investigation.21 In the instant
investigation, as AFA, we have
preliminarily assigned to the PRC–wide
entity, including Tianda, the highest
rate on the record of this proceeding,
which in this case is the 55.62 percent
margin from the petition.22 The
Department preliminarily determines
that this information is the most
appropriate from the available sources
to effectuate the purposes of AFA.
The Department will consider all
margins on the record at the time of the
final determination for the purpose of
determining the most appropriate AFA
rate for the PRC–wide entity including
Tianda.23
sroberts on PROD1PC70 with NOTICES
Corroboration
Section 776(c) of the Act provides
that, when the Department relies on
secondary information rather than on
information obtained in the course of an
investigation as facts available, it must,
to the extent practicable, corroborate
that information from independent
sources reasonably at its disposal.
Secondary information is described as
‘‘information derived from the petition
Memory Semiconductors From Taiwan, 63 FR 8909,
8932 (February 23, 1998).
19 See Brake Rotors From the People’s Republic of
China: Final Results and Partial Rescission of the
Seventh Administrative Review; Final Results of the
Eleventh New Shipper Review, 70 FR 69937, 69939
(November 18, 2005), quoting SAA at 870.
20 See, e.g., Certain Cased Pencils from the
People’s Republic of China; Preliminary Results of
Antidumping Duty Administrative Review and
Intent to Rescind in Part, 70 FR 76755, 76761
(December 28, 2005), unchanged in Certain Cased
Pencils from the People’s Republic of China; Final
Results and Partial Rescission of Antidumping Duty
Administrative Review, 71 FR 38366, (July 6, 2006),
and accompanying Issues and Decision
Memorandum at Comment 10.
21 See Final Determination of Sales at Less Than
Fair Value: Certain Cold-Rolled Carbon Quality
Steel Products from the People’s Republic of China,
65 FR 34660 (May 21, 2000), and accompanying
Issues and Decision Memorandum at ‘‘Facts
Available.’’
22 See Initiation Notice.
23 See Notice of Preliminary Determination of
Sales at Less Than Fair Value: Saccharin from the
People’s Republic of China, 67 FR 79049, 79053-54
(December 27, 2002), unchanged in Notice of Final
Determination of Sales at Less Than Fair Value:
Saccharin From the People’s Republic of China, 68
FR 27530 (May 20, 2003).
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
that gave rise to the investigation or
review, the final determination
concerning merchandise subject to this
investigation, or any previous review
under section 751 concerning the
merchandise subject to this
investigation.’’24 To ‘‘corroborate’’
means simply that the Department will
satisfy itself that the secondary
information to be used has probative
value.25 Independent sources used to
corroborate may include, for example,
published price lists, official import
statistics and customs data, and
information obtained from interested
parties during the particular
investigation.26 To corroborate
secondary information, the Department
will, to the extent practicable, examine
the reliability and relevance of the
information used.27
The AFA rate that the Department
used is from the petition.28 Petitioners’
methodology for calculating the United
States price and NV in the petition is
discussed in the initiation notice.29 To
corroborate the AFA margin we have
selected, we compared that margin to
the margins we found for the
respondents. We found that the margin
of 55.62 percent has probative value
because it is in the range of margins we
found for the mandatory respondents.
Accordingly, we find that the rate of
55.62 percent is corroborated within the
meaning of section 776(c) of the Act.
Consequently, we are applying a
single antidumping rate--the PRC–wide
rate--to producers/exporters that failed
to respond to the Department’s
antidumping questionnaires, or requests
for shipment information, or did not
apply for a separate rate, as applicable.
The PRC–wide rate applies to all entries
of the merchandise under investigation
except for entries from respondents,
DunAn and Sanhua. These companies
and their corresponding antidumping
duty cash deposit rates are listed below
24 See Final Determination of Sales at Less Than
Fair Value: Sodium Hexametaphosphate From the
People’s Republic of China, 73 FR 6479, 6481
(February 4, 2008), quoting SAA at 870.
25 See Id.
26 See Id.
27 See Tapered Roller Bearings and Parts Thereof,
Finished and Unfinished, from Japan, and Tapered
Roller Bearings, Four Inches or Less in Outside
Diameter, and Components Thereof, from Japan;
Preliminary Results of Antidumping Duty
Administrative Reviews and Partial Termination of
Administrative Reviews, 61 FR 57391, 57392
(November 6, 1996), unchanged in Tapered Roller
Bearings and Parts Thereof, Finished and
Unfinished, From Japan, and Tapered Roller
Bearings, Four Inches or Less in Outside Diameter,
and Components Thereof, From Japan; Final
Results of Antidumping Duty Administrative
Reviews and Termination in Part, 62 FR 11825
(March 13, 1997).
28 See Initiation Notice.
29 See Initiation Notice.
PO 00000
Frm 00008
Fmt 4703
Sfmt 4703
in the ‘‘Preliminary Determination’’
section of this notice.
Fair Value Comparisons
To determine whether sales of FSVs
to the United States by the respondents
were made at LTFV, we compared
constructed export price (‘‘CEP’’) to NV,
as described in the ‘‘Constructed Export
Price’’ and ‘‘Normal Value’’ sections of
this notice.
Constructed Export Price
In accordance with section 772(b) of
the Act, CEP is the price at which the
subject merchandise is 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 of such merchandise or by a
seller affiliated with the producer or
exporter, to a purchaser not affiliated
with the producer or exporter, as
adjusted under sections 772(c) and (d)
of the Act. In accordance with section
772(b) of the Act, we used CEP for
DunAn’s and Sanhua’s sales because the
sales were made by the U.S. affiliate in
the United States.
We calculated CEP based on delivered
prices to unaffiliated purchasers in the
United States.30 In accordance with
section 772(d)(1) of the Act, we made
deductions from the starting price for
billing adjustments, movement
expenses, discounts and rebates. We
made deductions from the U.S. sales
price for movement expenses in
accordance with section 772(c)(2)(A) of
the Act. These included, where
applicable, foreign inland freight from
the plant to the port of exportation,
ocean freight, U.S. customs duty, U.S.
brokerage and handling, U.S. inland
freight from port to the warehouse, and
warehousing expense. In accordance
with section 772(d)(1) of the Act, the
Department deducted, where applicable,
commissions, credit expenses, inventory
carrying costs and indirect selling
expenses from the U.S. price, all of
which relate to commercial activity in
the United States. In addition, we
deducted CEP profit in accordance with
sections 772(d)(3) and 772(f) of the Act.
In accordance with section 773(a) of the
30 On October 7, 2008, DunAn submitted an
unsolicited revised Section C questionnaire
response, stating that it was reporting revised
standard and actual weights for its sales of FSVs
and that, in accordance with these revised weights,
it had also revised all reported U.S. selling expenses
that had been calculated based on allocations
relying on those weights. Due to the timing of this
unsolicited submission, and the magnitude of the
changes, we are unable to review this submission
for purposes of the preliminary determination.
However, we will review this submission after
issuance of the preliminary determination and will
address any issues attendant to this submission at
that time.
E:\FR\FM\22OCN1.SGM
22OCN1
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
Act, we calculated DunAn’s and
Sanhua’s credit expenses and inventory
carrying costs based on the Federal
Reserve short–term rate.
Normal Value
We compared NV to weighted–
average CEPs in accordance with section
777A(d)(1) of the Act. Further, section
773(c)(1) of the Act provides that the
Department shall determine the NV
using an FOP methodology if the
merchandise is exported from an NME
and the information does not permit the
calculation of NV using home–market
prices, third–country prices, or
constructed value under section 773(a)
of the Act. The Department bases NV on
the FOPs because the presence of
government controls on various aspects
of NMEs renders price comparisons and
the calculation of production costs
invalid under its normal methodologies.
The Department’s questionnaire
requires that the respondent provide
information regarding the weighted–
average FOPs across all of the
company’s plants that produce the
subject merchandise, not just the FOPs
from a single plant. This methodology
ensures that the Department’s
calculations are as accurate as
possible.31
sroberts on PROD1PC70 with NOTICES
Sanhua
Sanhua reported a quantity of brass
bar consumed for the production of
self–produced semi–finished valve
bodies, a quantity for its claimed brass
and copper scrap by–product offsets and
quantities for the remaining FOPs used
in the production of subject
merchandise. We have determined not
to grant Sanhua’s requested by–product
offsets for brass scrap and copper waste
because Sanhua did not properly report
actual scrap generated and consumed,
despite the Department’s request in a
supplemental questionnaire. See
Sanhua’sSupplemental Response, dated
September 29, 2008. For the subject
merchandise produced by Sanhua that
does not incorporate a semi–finished
valve body from a toller, we have
calculated NV using the reported FOPs,
except for the by–product offsets for
brass scrap and copper waste.
With respect to the semi–finished
valve bodies produced by the toller,
Sanhua only reported the FOPs of the
brass bar consumed in production.
Sanhua did not report the remaining
FOPs used by its toller for the
31 See, e.g., Final Determination of Sales at Less
Than Fair Value and Critical Circumstances:
Certain Malleable Iron Pipe Fittings From the
People’s Republic of China, 68 FR 61395 (October
28, 2003), and accompanying Issues and Decision
Memorandum at Comment 19.
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
production of semi–finished brass valve
bodies. Therefore, valuing only the brass
bar would not capture costs associated
with the processing of the semi–finished
valve body. For the calculation of NV
for subject merchandise using a semi–
finished valve body from a toller, we
applied a surrogate value (‘‘SV’’) for
semi–finished brass valve bodies
directly to the reported standard weight
of the brass body. Finally, we
determined not to value the reported
semi–finished valve body because the
reported weights for that input are not
sufficient to make the merchandise. See
Sanhua’s Preliminary Determination
Analysis Memorandum, dated
concurrently with this notice.
DunAn
In its September 22, 2008, Section D,
FOP database, DunAn reported FOPs
and a by–product offset for brass scrap.
However, its net FOPs (i.e, the reported
FOPs less the claimed brass scrap by–
product offset) were insufficient to
account for the reported weight of its
finished products. In response to a
request from the Department, DunAn
reviewed its reporting methodology and
submitted a revised FOP database to the
Department on October 7, 2008,
claiming to have addressed this issue. In
the narrative portion of this submission,
DunAn stated that it had revised only its
claimed brass scrap offset. However,
upon reviewing the October 7, 2008,
FOP database, we found that DunAn
had also revised its reported brass
inputs. Due to the timing of this
submission, we are unable to address
these unidentified data changes with
DunAn prior to the preliminary
determination. Therefore, for purposes
of the preliminary determination, as
facts available, we used the FOP data
from DunAn’s September 22, 2008,
submission, but did not grant DunAn’s
requested by–product offset for brass
scrap. We will address this issue further
after issuance of the preliminary
determination. For further discussion of
this issue, please see DunAn’s
Preliminary Determination Analysis
Memorandum.
Factor Valuations
In accordance with section 773(c) of
the Act, we calculated NV based on
FOPs reported by the respondent for the
POI. To calculate NV, we multiplied the
reported per–unit factor–consumption
rates by publicly available Indian SVs.
In selecting the SVs, we considered the
quality, specificity, and
contemporaneity of the data. As
appropriate, we adjusted input prices by
including freight costs to make them
delivered prices. Specifically, we added
PO 00000
Frm 00009
Fmt 4703
Sfmt 4703
62957
to Indian import SVs a surrogate freight
cost using the shorter of the reported
distance from the domestic supplier to
the factory of production or the distance
from the nearest seaport to the factory
of production, where appropriate. This
adjustment is in accordance with the
U.S. Court of Appeals for the Federal
Circuit’s decision in Sigma Corp. v.
United States, 117 F. 3d 1401, 1407–
1408 (Fed. Cir. 1997). A detailed
description of all SVs used can be found
in the Factor Valuation Memorandum.
For this preliminary determination, in
accordance with the Department’s
practice, we used import values from
the World Trade Atlas online (‘‘Indian
Import Statistics’’), which were
published by the Directorate General of
Commercial Intelligence and Statistics,
Ministry of Commerce of India, which
were reported in rupees and are
contemporaneous with the POI to
calculate SVs for the mandatory
respondents’ material inputs. In
selecting the best available information
for valuing FOPs in accordance with
section 773(c)(1) of the Act, the
Department’s practice is to select, to the
extent practicable, SVs which are non–
export average values, most
contemporaneous with the POI,
product–specific, and tax–exclusive.32
In those instances where we could not
obtain publicly available information
contemporaneous with the POI with
which to value FOPs, we adjusted the
SVs using, where appropriate, the
Indian Wholesale Price Index (‘‘WPI’’),
as published in the International
Financial Statistics of the International
Monetary Fund.
Furthermore, with regard to the
Indian import–based SVs, we have
disregarded import prices that we have
reason to believe or suspect may be
subsidized. We have reason to believe or
suspect that prices of inputs from
Indonesia, South Korea, and Thailand
may have been subsidized. We have
found in other proceedings that these
countries maintain broadly available,
non–industry-specific export subsidies
and, therefore, it is reasonable to infer
that all exports to all markets from these
countries may be subsidized.33 We are
32 See, e.g., Notice of Preliminary Determination
of Sales at Less Than Fair Value, Negative
Preliminary Determination of Critical
Circumstances and Postponement of Final
Determination: Certain Frozen and Canned
Warmwater Shrimp From the Socialist Republic of
Vietnam, 69 FR 42672, 42682 (July 16, 2004),
unchanged in Final Determination of Sales at Less
Than Fair Value: Certain Frozen and Canned
Warmwater Shrimp from the Socialist Republic of
Vietnam, 69 FR 71005 (December 8, 2004).
33 See Notice of Final Determination of Sales at
Less Than Fair Value and Negative Final
E:\FR\FM\22OCN1.SGM
Continued
22OCN1
62958
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
sroberts on PROD1PC70 with NOTICES
also guided by the legislative history not
to conduct a formal investigation to
ensure that such prices are not
subsidized.34 The Department bases its
decision on information that is available
to it at the time it makes its
determination. Therefore, we have not
used prices from these countries in
calculating the Indian import–based
SVs. In addition, we excluded Indian
import data from NME countries from
our SV calculations.35
We used Indian transport information
to value the inland freight cost of the
raw materials. The Department
determined the best available
information for valuing truck freight to
be from the following website: https://
www.infobanc.com/logistics/
logtruck.htm. The logistics section of
this source contains inland truck freight
rates from four major points of origin to
25 destinations in India. The
Department obtained inland truck
freight rates updated through September
2008 from each point of origin to each
destination and averaged the data
accordingly. Since this value is not
contemporaneous with the POI, we
deflated the rate using the WPI. See
Factor Valuation Memorandum.
We used three sources to calculate an
SV for domestic brokerage expenses.
The Department averaged July 2004–
June 2005 data contained in the January
9, 2006, public version of Kejriwal
Paper Ltd.’s (‘‘Kejriwal’’) response
submitted in the antidumping duty
investigation of lined paper products
from India,36 the February 2004–January
2005 data contained in the May 24,
2005, public version of Agro Dutch
Industries Limited’s (‘‘Agro Dutch’’)
response submitted in the
administrative review of the
antidumping duty order on certain
preserved mushrooms from India,37 and
Determination of Critical Circumstances: Certain
Color Television Receivers From the People’s
Republic of China, 69 FR 20594 (April 16, 2004),
and accompanying Issues and Decision
Memorandum at Comment 7.
34 See Omnibus Trade and Competitiveness Act
of 1988, Conference Report to Accompanying H.R.
3, H.R. Rep. 100-576 at 590 (1988).
35 For a detailed description of all SVs used for
each respondent, see Factor Valuation
Memorandum.
36 See Preliminary Determination of Sales at Less
Than Fair Value, Postponement of Final
Determination, and Affirmative Preliminary
Determination of Critical Circumstances in Part:
Certain Lined Paper Products from India, 71 FR
19706 (April 17, 2006), unchanged in Notice of
Final Determination of Sales at Less Than Fair
Value, and Negative Determination of Critical
Circumstances: Certain Lined Paper Products from
India, 71 FR 45012 (August 8, 2006).
37 See Certain Preserved Mushrooms From India:
Preliminary Results of Antidumping Duty
Administrative Review, 70 FR 10597, 10599 (March
4, 2005), unchanged in Certain Preserved
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
the December 2003–November 2004
data contained in the February 28, 2005,
public version of Essar Steel’s (‘‘Essar’’)
response submitted in the antidumping
duty administrative review of hot–rolled
carbon steel flat products from India.38
The brokerage expense data reported by
Kejriwal, Agro Dutch, and Essar in their
public versions are ranged data. The
Department first derived an average
per–unit amount from each source.
Then the Department adjusted each
average rate for inflation. Finally, the
Department averaged the three per–unit
amounts to derive an overall average
rate for the POI. See Factor Valuation
Memorandum.
For direct, indirect, and packing
labor, consistent with 19 CFR
351.408(c)(3), we used the PRC
regression–based wage rate as reported
on Import Administration’s home page,
Import Library, Expected Wages of
Selected NME Countries, revised in May
2008, available at https://ia.ita.doc.gov/
wages/. Because this
regression–based wage rate does not
separate the labor rates into different
skill levels or types of labor, we have
applied the same wage rate to all skill
levels and types of labor reported by the
respondent.39 If the NME wage rates are
updated by the Department prior to
issuance of the final determination, we
will use the updated wage rate in the
final LTFV determination.
We valued electricity using price data
for small, medium, and large industries,
as published by the Central Electricity
Authority of the Government of India in
its publication titled Electricity Tariff &
Duty and Average Rates of Electricity
Supply in India, dated July 2006. These
electricity rates represent actual
country–wide, publicly available
information on tax–exclusive electricity
rates charged to industries in India.
Since the rates are not contemporaneous
with the POI, we inflated the values
using the WPI. See Factor Valuation
Memorandum.
To value factory overhead, selling,
general, and administrative expenses
(‘‘SG&A’’) and profit, we used audited
financial statements of Carbac Holdings
Ltd. (‘‘Carbac’’), an Indian brass valve
producer; Upadhaya Valves
Manufacturers Private Limited
(‘‘Upadhaya’’), an Indian producer of
Mushrooms From India: Final Results of
Antidumping Duty Administrative Review, 70 FR
37757 (June 30, 2005).
38 See Certain Hot-Rolled Carbon Steel Flat
Products From India: Preliminary Results of
Antidumping Duty Administrative Review, 71 FR
2018, 2021 (January 12, 2006), unchanged in
Certain Hot-Rolled Carbon Steel Flat Products From
India: Final Results of Antidumping Duty
Administrative Review, 71 FR 40694 (July 18, 2006).
39 See Factor Valuation Memorandum.
PO 00000
Frm 00010
Fmt 4703
Sfmt 4703
valves and fittings; and Oswal Valves
Pvt. Ltd. (‘‘Oswal’’), an Indian producer
of valves. We did not rely upon three
company’s financial statements that
were placed on the record, namely the
financial statements of Brassomatic Pvt.
Ltd. (‘‘Brassomatic’’), Larsen & Toubro
(‘‘L&T’’), and Valve Power Engineers
Private Limited (‘‘Valve Power’’). We
did not rely upon the Brassomatic
financial statement because it did not
report a profit. It is the Department’s
practice to disregard financial
statements with zero profit when there
are financial statements on the record of
other surrogate companies that have
earned a profit. See Notice of Initiation
of Antidumping Duty Investigations:
Electrolytic Manganese Dioxide from
Australia and the People’s Republic of
China, 72 FR 52850 (September 17,
2007), citing Certain Frozen Warmwater
Shrimp from the Socialist Republic of
Vietnam: Final Results of the First
Antidumping Administrative Review
and First New Shipper Review, 72 FR
52052 (September 12, 2007), and
accompanying Issues and Decision
Memorandum at Comment 2, section B.
Additionally, we did not rely upon
L&T’s financial statement because L&T’s
financial statement identifies mixed
operations and a significant portion of
its business activities is not related to
production of comparable
merchandise.40 It is the Department’s
practice to disregard financial
statements with mixed operations and
significant operations unrelated to
production of comparable merchandise
where there are sufficient financial
statements on the record for producers
of comparable merchandise. See
Chlorinated Isocyanurates from the
People’s Republic of China: Final
Results of Antidumping Duty
Administrative Review, 73 FR 159
(January 2, 2008), and accompanying
Issues and Decision Memorandum at
Comment 10. Further, we did not rely
upon Valve Power’s financial statement
because Valve Power is not a producer
of comparable merchandise. Valve
Power stated in its financial statement
that ‘‘the company is in the business of
production & sales of manual operated
quarter turn gearboxes required to open
& close valves.’’ It is the Department’s
practice to disregard financial
statements that indicate that the
company is not a producer of identical
or comparable merchandise. See
Wooded Bedroom Furniture from the
People’s Republic of China: Final
Results of Antidumping Duty
Administrative Review and New
40 See DunAn’s September 29, 2009, submission
at Exhibit 9C.
E:\FR\FM\22OCN1.SGM
22OCN1
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
Shipper Review, 73 FR 49162 (August
20, 2008), and accompanying Issues and
Decision Memorandum at Comment 1C.
See Factor Valuation Memorandum for
a full discussion of the calculation of
Carbac’s, Upadhaya’s, Oswal’s ratios.
The Department valued water using
data from the Maharashtra Industrial
Development Corporation
(www.midcindia.org) because it
includes a wide range of industrial
water tariffs. This source provides 386
industrial water rates within the
Maharashtra province from June 2003:
193 for the ‘‘inside industrial areas’’
usage category and 193 for the ‘‘outside
industrial areas’’ usage category.
Because the value was not
contemporaneous with the POI, we
adjusted the rate for inflation.
Post–Preliminary Determination
Supplemental Questionnaire
In reviewing Sanhua’s and DunAn’s
original and supplemental questionnaire
responses, we have determined that
certain reported items require additional
supplemental information. We expect to
issue post–preliminary determination
supplemental questionnaires to both
Sanhua and DunAn to address these and
other deficiencies.
Critical Circumstances
sroberts on PROD1PC70 with NOTICES
A. DunAn and Sanhua
On September 9, 2008, Petitioner
alleged that there is a reasonable basis
to believe or suspect that critical
circumstances exist with respect to the
antidumping investigation of FSVs from
the PRC. Because Petitioner submitted
its critical circumstances allegation
more than 20 days before the
preliminary determination, the
Department is issuing a preliminary
finding of critical circumstances with its
preliminary determination.41 Section
733(e)(1) of the Act provides that, upon
receipt of a timely allegation of critical
circumstances, the Department will
determine whether there is a reasonable
basis to believe or suspect that: (A)(i)
there is a history of dumping and
material injury by reason of dumped
imports in the United States or
elsewhere of the subject merchandise or
(ii) the person by whom, or for whose
account, the merchandise was imported
knew or should have known that the
exporter was selling the subject
merchandise at less than its fair value
and that there was likely to be material
injury by reason of such sales, and (B)
there have been massive imports of the
subject merchandise over a relatively
short period.
41See
19 CFR 351.206(c)(2)(ii).
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
To determine whether the above
statutory criteria have been satisfied, the
Department examined the following
information: (1) evidence presented in
Petitioner’s September 9, 2008,
submission; (2) evidence obtained since
the initiation of the LTFV investigation
(i.e., import statistics obtained from the
ITC Data Web); and (3) the ITC’s
preliminary material injury
determination.42
To determine whether a history of
dumping and material injury exists, the
Department generally considers current
or previous antidumping duty orders on
subject merchandise from the country in
question in the United States and
current orders in any other country with
regard to imports of subject
merchandise. Petitioner makes no
statement concerning a history of
dumping with respect to FSVs from the
PRC in the United States or elsewhere.
Moreover, the Department is not aware
of any other antidumping order in the
United States or in any country on FSVs
from the PRC. Therefore, the
Department finds no history of injurious
dumping of FSVs from the PRC in
accordance with section 733(e)(1)(A)(i)
of the Act.
To determine whether an importer
knew, or should have known, that the
exporter was selling subject
merchandise at LTFV in accordance
with section 733(e)(1)(A)(ii) of the Act,
the Department must rely on the facts
before it at the time the determination
is made. The Department normally
considers margins of 25 percent or more
for export price (‘‘EP’’) sales and 15
percent or more for CEP sales sufficient
to impute importer knowledge of sales
at LTFV.43 Petitioner suggests the use of
the margins used by the Department at
the investigation initiation.44 However,
we find the use of the alleged rates in
the Petition to be unnecessary in this
case because the Department’s
preliminary determination has found
margins of 26.72 percent for DunAn,
and 15.41 percent for Sanhua. Based on
these margins, the Department
preliminarily finds that both DunAn’s
and Sanhua’s importers knew, or should
have known, that DunAn and Sanhua
were selling subject merchandise at
LTFV.
To determine whether an importer
knew or should have known that there
42 See
ITC Preliminary Determination.
e.g., Notice of Final Determination of Sales
at Less Than Fair Value and Affirmative Final
Determination of Critical Circumstances: Glycine
from Japan, 72 FR 67271 (November 28, 2007), and
accompanying Issues and Decisions Memorandum
at Comment 4.
44 See Petitioner’s September 9, 2008, submission
at 3-4, citing Initiation Notice.
43 See,
PO 00000
Frm 00011
Fmt 4703
Sfmt 4703
62959
was likely to be material injury caused
by reason of such imports consistent
with section 733(e)(1)(A)(ii) of the Act,
the Department normally will look to
the preliminary injury determination of
the ITC. If the ITC finds a reasonable
indication of present material injury to
the relevant U.S. industry, the
Department will determine that a
reasonable basis exists to impute
importer knowledge that material injury
is likely by reason of such imports.45 In
the instant case, the ITC preliminarily
determined that material injury to the
domestic industry exists due to imports
of FSVs from the PRC, which are alleged
to be sold in the United States at LTFV
and, on this basis, the Department
imputes knowledge of the likelihood of
injury to Petitioner. See ITC Preliminary
Determination.
As DunAn and Sanhua meet the first
prong of the critical circumstances test
according to section 733(e)(1)(A)(i) of
the Act, the Department must examine
whether imports from DunAn and
Sanhua were massive over a relatively
short period. Section 733(e)(1)(B) of the
Act provides that the Department will
preliminarily determine that critical
circumstances exist if there is a
reasonable basis to believe or suspect
that there have been massive imports of
the subject merchandise over a
relatively short period.
Section 351.206(h)(1) of the
Department’s regulations provides that,
in determining whether imports of the
subject merchandise have been
‘‘massive,’’ the Department will
normally examine (i) the volume and
value of the imports, (ii) seasonal
trends, and (iii) the share of domestic
consumption accounted for by the
imports. In addition, 19 CFR
351.206(h)(2) provides that, ‘‘In general,
unless the imports during the relatively
short period . . . have increased by at
least 15 percent over the imports during
an immediately preceding period of
comparable duration, the Secretary will
not consider the imports massive.’’
Section 351.206(i) of the Department’s
regulations defines ‘‘relatively short
period’’ as generally the period
beginning on the date the proceeding
begins (i.e., the date the petition is filed)
and ending at least three months later.
This section provides further that, if the
Department ‘‘finds that importers, or
exporters or producers, had reason to
believe, at some time prior to the
beginning of the proceeding, that a
proceeding was likely,’’ the Department
45 See, e.g., Final Determination of Sales at Less
Than Fair Value: Certain Cut-To-Length Carbon
Steel Plate from the People’s Republic of China, 62
FR 61964 (November 20, 1997).
E:\FR\FM\22OCN1.SGM
22OCN1
62960
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
may consider a period of not less than
three months from that earlier time. The
Department normally compares the
import volumes of the subject
merchandise for at least three months
immediately preceding the filing of the
petition (‘‘base period’’) to a comparable
period of at least three months following
the filing of the petition (‘‘comparison
period’’). Imports normally will be
considered massive when imports
during the comparison period have
increased by 15 percent or more
compared to imports during the base
period.46
Petitioner based its allegation of
critical circumstances in this
investigation on the increase in imports
of FSVs that began with the filing of the
antidumping duty petition on March 19,
2008. The Department’s practice is to
rely upon the longest period for which
information is available from the month
that the petition was filed through the
date of the preliminary determination.47
Generally, the Department’s approach
has been to examine overall industry
imports as well as company–specific
imports to corroborate whether massive
imports have occurred within the
designated comparative period, that is,
the point at which importers had reason
to believe that a proceeding was likely.
See Notice of Final Determination of
Sales at Less Than Fair Value: Hot–
Rolled Flat–Rolled Carbon–Quality Steel
Products from Japan, 64 FR 24329 (May
6, 1999); see also Notice of Final
Determinations of Sales at Less Than
Fair Value: Certain Cold–Rolled Flat–
Rolled Carbon–Quality Steel Products
From Argentina, Japan and Thailand,
65 FR 5520, 5527 (February 4, 2000).
However, the Department is unable to
rely on the ITC Data Web for imports
within the HTSUS subheadings
identified in the scope of the
investigation because those HTSUS
subheadings are basket categories that
may include non–subject merchandise.
Petitioner has acknowledged that the
HTSUS data, in and of itself, is not a
reliable measure to be used in the
instant investigation as the HTSUS
subheadings are basket categories that
contain many types of merchandise. For
example, HTSUS 8481.80.10.95 is a
category for high–pressure valves,
cocks, and taps and HTSUS
46 See
19 CFR 351.206(h)(2).
Notice of Preliminary Determination of
Sales at Less Than Fair Value, Postponement of
Final Determination, and Affirmative Preliminary
Critical Circumstances Determination: Certain
Orange Juice from Brazil, 70 FR 49557 (August 24,
2005), unchanged in 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
(January 13, 2006).
sroberts on PROD1PC70 with NOTICES
47 See
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
8415.90.80.85 is a category for generic
air conditioner parts.48 Additionally,
Petitioner contends that parties
misreport under the HTSUS system.49
Finally, Petitioner cites that one of the
HTSUS subheadings is reported in units
rather than kilograms.50 Lacking
information on whether there was a
massive import surge, the Department is
unable to determine whether there have
been massive imports of FSVs from the
PRC.
On September 30, 2008, the
Department requested that both DunAn
and Sanhua provide the quantity and
value of their monthly shipments of
FSVs to the United States for the period
November 2007 through August 2008.
We received DunAn’s and Sanhua’s
responses on October 14, 2008. Because
we received DunAn’s and Sanhua’s
information one day before the
preliminary determination, we are
unable to review this information prior
to making our preliminary
determination; however, we will review
this information for purposes of the
final determination. Thus, lacking the
appropriate subject merchandise–
specific information on whether there
was a massive import surge, the
Department is unable to determine, with
the necessary accuracy, whether there
have been massive imports of FSVs from
the PRC during the designated relatively
short period. See Notice of Preliminary
Determination of Sales at Less Than
Fair Value and Affirmative Preliminary
Determination of Critical
Circumstances: Wax and Wax/Resin
Thermal Transfer Ribbons From Japan,
68 FR 71072, (December 22, 2003).
Consequently, the criteria necessary for
determining affirmative critical
circumstances have not been met and,
therefore, the Department preliminarily
determines that critical circumstances
do not exist for imports of FSVs from
the PRC.
The Department will issue a final
determination concerning critical
circumstances for DunAn and Sanhua
for FSVs from the PRC when it issues
the final determination in the instant
investigation. In making our final
determination, we will examine the
company–specific shipment data from
DunAn and Sanhua to determine if
critical circumstances existed for these
two companies. Additionally, the
Department has requested and will
examine a sampling of entry packages
from U.S. Customs and Border
Protection (‘‘CBP’’) for certain entries of
48 See
Petitioner’s September 9, 2008, submission
at 6.
49 Id.
50 Id.
PO 00000
Frm 00012
Fmt 4703
Sfmt 4703
FSVs during the base and comparison
periods in our analysis for the final
determination.
B. PRC–Wide Entity
The Department follows the
traditional critical circumstances
criteria with respect to the companies
covered in the PRC–wide entity.51 First,
in determining whether there is a
reasonable basis to believe or suspect
that an importer knew or should have
known that the exporter was selling
FSVs at LTFV, we look to the PRC–wide
rate.52 The dumping margin for the
PRC–wide entity is 55.62 percent,
which is more than the 15 percent
threshold necessary to impute
knowledge of dumping consistent with
section 733(e)(1)(A)(ii) of the Act.
Second, based on the ITC’s preliminary
material injury determination, we also
find that importers knew or should have
known that there would be material
injury from the dumped merchandise
consistent with 19 CFR 351.206.53
Finally, with respect to massive
imports, the Department’s general
approach is to examine CBP data on
overall imports from the country in
question to see if the Department could
ascertain whether an increase in
shipments occurred within a relatively
short period following the point at
which importers had reason to believe
that a proceeding was likely.54 However,
we are unable to rely on information
supplied by CBP because in this
investigation the HTSUS subheadings
listed in the scope of the investigation
are basket categories that include non–
subject merchandise. Lacking
information on whether there was a
massive import surge for the PRC–wide
entity, we are unable to determine
whether there have been massive
imports of FSVs from the producers
included in the PRC–wide entity.55
Consequently, the criteria necessary
for determining affirmative critical
circumstances have not been met.
51 See, e.g., Certain New Pneumatic Off-The-Road
Tires from the People’s Republic of China:
Affirmative Preliminary Determination of Critical
Circumstances, 73 FR 21312 (April 21, 2008),
unchanged in Certain New Pneumatic Off-the-Road
Tires from the People’s Republic of China: Final
Affirmative Determination of Sales at Less than Fair
Value and Partial Affirmative Determination of
Critical Circumstances, 73 FR 40485 (July 15, 2008).
52 See Id.
53 See ITC Preliminary Determination.
54 See, e.g., Notice of Final Determination of Sales
at Less Than Fair Value: Hot-Rolled Flat-Rolled
Carbon-Quality Steel Products from Japan, 64 FR
24329 (May 6, 1999).
55 See, e.g., Notice of Preliminary Affirmative
Countervailing Duty Determination and Preliminary
Negative Critical Circumstances Determination:
Certain Lined Paper Products from India, 71 FR
7916 (February 15, 2006).
E:\FR\FM\22OCN1.SGM
22OCN1
Federal Register / Vol. 73, No. 205 / Wednesday, October 22, 2008 / Notices
preliminary determination for all
shipments of merchandise under
consideration entered or withdrawn
from warehouse, for consumption on or
after publication date: (1) The rate for
Currency Conversion
the exporter/producer combinations
We made currency conversions into
listed in the chart above will be the rate
U.S. dollars, in accordance with section we have determined in this preliminary
773A(a) of the Act, based on the
determination; (2) for all PRC exporters
exchange rates in effect on the dates of
of merchandise subject to this
the U.S. sales as certified by the Federal investigation that have not received
Reserve Bank.
their own rate, the cash–deposit rate
will be the PRC–wide rate; (3) for all
Verification
non–PRC exporters of merchandise
As provided in section 782(i)(1) of the subject to this investigation that have
Act, we intend to verify the information not received their own rate, the cash–
from DunAn and Sanhua upon which
deposit rate will be the rate applicable
we will rely in making our final
to the PRC exporter/producer
determination.
combination that supplied that non–
PRC exporter. These suspension–ofCombination Rates
liquidation instructions will remain in
In the Initiation Notice, the
effect until further notice. We will
Department stated that it would
instruct CBP to require a cash deposit or
calculate combination rates for certain
the posting of a bond equal to the
respondents that are eligible for a
weighted–average amount by which the
separate rate in this investigation.56 This NV exceeds U.S. price, as indicated
practice is described in Policy Bulletin
above. The suspension of liquidation
05.1.
will remain in effect until further notice.
Therefore, we have preliminarily
determined that critical circumstances
do not exist for imports of FSVs for the
PRC–wide entity.
Preliminary Determination
The weighted–average dumping
margins are as follows:
Exporter/Producer
Combination
Percent Margin
Exporter: Zhejiang
Sanhua Co., Ltd.
Producer: Zhejiang
Sanhua Co., Ltd. .......
Exporter: Zhejiang
DunAn Hetian Metal
Co., Ltd.
Producer: Zhejiang
DunAn Hetian Metal
Co., Ltd. ....................
PRC–Wide Entity* ........
15.41
26.72
55.62
* The PRC–wide entity includes Tianda.
Disclosure
We will disclose the calculations
performed to parties in this proceeding
within five days of the date of
publication of this notice in accordance
with 19 CFR 351.224(b).
sroberts on PROD1PC70 with NOTICES
Suspension of Liquidation
In accordance with section 733(d) of
the Act, we will instruct CBP to suspend
liquidation of all entries of merchandise
subject to this investigation, entered, or
withdrawn from warehouse, for
consumption on or after the date of
publication of this notice in the Federal
Register. For the exporter/producer
combinations listed in the chart above,
the following cash deposit requirements
will be effective upon publication of the
56 See
Initiation Notice, 73 FR at 20255.
VerDate Aug<31>2005
17:50 Oct 21, 2008
Jkt 217001
International Trade Commission
Notification
In accordance with section 733(f) of
the Act, we have notified the ITC of our
preliminary affirmative determination of
sales at LTFV. Section 735(b)(2) of the
Act requires the ITC to make its final
determination as to whether the
domestic industry in the United States
is materially injured, or threatened with
material injury, by reason of imports of
FSVs, or sales (or the likelihood of sales)
for importation of FSVs within 45 days
of our final determination.
Public Comment
Case briefs or other written comments
may be submitted to the Assistant
Secretary for Import Administration no
later than seven days after the date on
which the final verification report is
issued in this proceeding and rebuttal
briefs, limited to issues raised in case
briefs, may be submitted no later than
five days after the deadline date for case
briefs. See 19 CFR 351.309. A table of
contents, list of authorities used and an
executive summary of issues should
accompany any briefs submitted to the
Department. This summary should be
limited to five pages total, including
footnotes. The Department also requests
that parties provide an electronic copy
of its case and rebuttal brief submissions
in either a ‘‘Microsoft Word’’ or ‘‘pdf’’
format.
In accordance with section 774 of the
Act, we will hold a public hearing, if
requested, to afford interested parties an
opportunity to comment on arguments
PO 00000
Frm 00013
Fmt 4703
Sfmt 4703
62961
raised in case or rebuttal briefs.
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, U.S. Department
of Commerce, Room 1870, within 30
days after the date of publication of this
notice.57 Requests should contain the
party’s name, address, and telephone
number, the number of participants, and
a list of the issues to be discussed. If a
request for a hearing is made, we intend
to hold the hearing three days after the
deadline of submission of rebuttal briefs
at the U.S. Department of Commerce,
14th Street and Constitution Ave., NW,
Washington, DC 20230, at a time and
location to be determined. See 19 CFR
351.310. Parties should confirm by
telephone the date, time, and location of
the hearing two days before the
scheduled date.
We will make our final determination
no later than 135 days after the date of
publication of this preliminary
determination, pursuant to section
735(a)(2) of the Act.
This determination is issued and
published in accordance with sections
733(f) and 777(i)(1) of the Act.
Dated: October 15, 2008.
David M. Spooner,
Assistant Secretary for Import
Administration.
[FR Doc. E8–25178 Filed 10–21–08; 8:45 am]
BILLING CODE: 3510–DS–S
DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric
Administration
RIN 0648–XI77
Marine Mammal Protection Act; Final
Conservation Plan for the Cook Inlet
Beluga Whale
National Marine Fisheries
Service (NMFS), National Oceanic and
Atmospheric Administration (NOAA),
Commerce.
ACTION: Notice; response to comments.
AGENCY:
SUMMARY: NMFS announces the
availability of the final conservation
plan for the Cook Inlet Beluga Whale
pursuant to the Marine Mammal
Protection Act of 1972, as amended
(MMPA). NMFS incorporated into this
document new information on Cook
Inlet beluga whales and comments
received on the draft conservation plan
released for public review and comment
on March 16, 2005.
57 See
E:\FR\FM\22OCN1.SGM
19 CFR 351.310(c).
22OCN1
]]>Agencies
[Federal Register Volume 73, Number 205 (Wednesday, October 22, 2008)]
[Notices]
[Pages 62952-62961]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-25178]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
A-570-933
Frontseating Service Valves from the People's Republic of China:
Preliminary Determination of Sales at Less Than Fair Value, Preliminary
Negative Determination of Critical Circumstances, and Postponement of
Final Determination
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
EFFECTIVE DATE: October 22, 2008.
SUMMARY: We preliminarily determine that frontseating service valves
(``FSVs'') from the People's Republic of China (``PRC'') are being, or
are likely to be, sold in the United States at less than fair value
(``LTFV''), as provided in section 733 of the Tariff Act of 1930, as
amended (``the Act''). The estimated margins of sales at LTFV are shown
in the ``Preliminary Determination'' section of this notice. Pursuant
to a request from an interested party, we are postponing the final
determination and extending the provisional measures from a four-month
period to not more than six months. Accordingly, we will make our final
determination not later than 135 days after publication of the
preliminary determination. See the ``Postponement of the Final
Determination'' section below.
FOR FURTHER INFORMATION CONTACT: Eugene Degnan or Robert Bolling, AD/
CVD Operations, Office 8, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, NW, Washington, DC, 20230; telephone: (202) 482-
0414 or 482-3434, respectively.
SUPPLEMENTARY INFORMATION:
Initiation
On March 19, 2008, Parker-Hannifin Corporation (``Petitioner'')
filed an antidumping petition in proper form on behalf of the domestic
industry concerning imports of FSVs from the PRC (``Petition''). The
Department of Commerce (``the Department'') initiated this
investigation on April 15, 2008.\1\ In the Initiation Notice, the
Department notified parties of the application process by which
exporters and producers may obtain separate-rate status in non-market
economy (``NME'') investigations. The process requires exporters and
producers to submit a separate-rate status application (``SRA'').\2\
However, the standard for eligibility for a separate rate (which is
whether a firm can demonstrate an absence of both de jure and de facto
government control over its export activities) has not changed. The SRA
for this investigation was posted on the Department's website on April
10, 2008, at https://ia.ita.doc.gov/ia-highlights-and-news.html. The due
date for filing an SRA was June 16, 2008. No party beyond the mandatory
respondents filed an SRA.
---------------------------------------------------------------------------
\1\ See Frontseating Service Valves from the People's Republic
of China: Notice of Initiation of Antidumping Duty Investigation, 73
FR 20250 (April 15, 2008) (``Initiation Notice'').
\2\ See Policy Bulletin 05.1: Separate-Rates Practice and
Application of Combination Rates in Antidumping Investigations
involving Non-Market Economy Countries (April 5, 2005) (``Policy
Bulletin 05.1''), available at https://ia.ita.doc.gov/policy/bull05-
1.pdf.
---------------------------------------------------------------------------
On May 12, 2008, the International Trade Commission (``ITC'')
preliminarily determined that there is a reasonable indication that an
industry in the United States is materially injured or threatened with
material injury by reason of imports of FSVs from the PRC.\3\
---------------------------------------------------------------------------
\3\ See Investigation Nos. 731-TA-1148 (Preliminary):
Frontseating Service Valves from China, 73 FR 28507 (May 16, 2008)
(``ITC Preliminary Determination'').
---------------------------------------------------------------------------
Period of Investigation
The period of investigation (``POI'') is July 1, 2007, through
December 31, 2007. This period corresponds to the two most recent
fiscal quarters prior to the month of the filing of the petition, which
was March 19, 2008.\4\
---------------------------------------------------------------------------
\4\ See 19 CFR 351.204(b)(1).
---------------------------------------------------------------------------
Postponement of Preliminary Determination
On July 30, 2008, Petitioner made a timely request, pursuant to
section
[[Page 62953]]
733(c)(1)(A) of the Act and 19 CFR 351.205(b)(2) and (e), for a 50-day
postponement of the preliminary determination. On August 11, 2008, the
Department published a postponement of the preliminary antidumping duty
determination on FSVs from the PRC.\5\
---------------------------------------------------------------------------
\5\ See Postponement of Preliminary Determination of Antidumping
Duty Investigation: Frontseating Service Valves from the People's
Republic of China, 73 FR 46586 (August 11, 2008).
---------------------------------------------------------------------------
Postponement of Final Determination and Extension of Provisional
Measures
On October 7 2008, Zhejiang Sanhua Co., Ltd. (``Sanhua'') made a
timely request pursuant to section 735(a)(2)(A) of the Act and 19 CFR
351.210(b)(2)(ii) that the Department postpone the final determination
and extend the provisional measures from a four-month period to not
more than six months in duration. We are granting Sanhua's request in
accordance with section 733(a)(2)(A) of the Act and 19 CFR
351.210(b)(2)(ii).
Scope of Investigation
The merchandise covered by this investigation is frontseating
service valves, assembled or unassembled, complete or incomplete, and
certain parts thereof. Frontseating service valves contain a sealing
surface on the front side of the valve stem that allows the indoor unit
or outdoor unit to be isolated from the refrigerant stream when the air
conditioning or refrigeration unit is being serviced. Frontseating
service valves rely on an elastomer seal when the stem cap is removed
for servicing and the stem cap metal to metal seat to create this seal
to the atmosphere during normal operation.\6\
---------------------------------------------------------------------------
\6\ The frontseating service valve differs from a backseating
service valve in that a backseating service valve has two sealing
surfaces on the valve stem. This difference typically incorporates a
valve stem on a backseating service valve to be machined of steel,
where an frontseating service valve has a brass stem. The
backseating service valve dual stem seal (on the back side of the
stem), creates a metal to metal seal when the valve is in the open
position, thus, sealing the stem from the atmosphere.
---------------------------------------------------------------------------
For purposes of the scope, the term ``unassembled'' frontseating
service valve means a brazed subassembly requiring any one or more of
the following processes: the insertion of a valve core pin, the
insertion of a valve stem and/or O ring, the application or
installation of a stem cap, charge port cap or tube dust cap. The term
``complete'' frontseating service valve means a product sold ready for
installation into an air conditioning or refrigeration unit. The term
``incomplete'' frontseating service valve means a product that when
sold is in multiple pieces, sections, subassemblies or components and
is incapable of being installed into an air conditioning or
refrigeration unit as a single, unified valve without further assembly.
The major parts or components of frontseating service valves
intended to be covered by the scope under the term ``certain parts
thereof'' are any brazed subassembly consisting of any two or more of
the following components: a valve body, field connection tube, factory
connection tube or valve charge port. The valve body is a rectangular
block, or brass forging, machined to be hollow in the interior, with a
generally square shaped seat (bottom of body). The field connection
tube and factory connection tube consist of copper or other metallic
tubing, cut to length, shaped and brazed to the valve body in order to
create two ports, the factory connection tube and the field connection
tube, each on opposite sides of the valve assembly body. The valve
charge port is a service port via which a hose connection can be used
to charge or evacuate the refrigerant medium or to monitor the system
pressure for diagnostic purposes.
The scope includes frontseating service valves of any size,
configuration, material composition or connection type. Frontseating
service valves are classified under subheading 8481.80.1095, and also
have been classified under subheading 8415.90.80.85, of the Harmonized
Tariff Schedule of the United States (``HTSUS''). It is possible for
frontseating service valves to be manufactured out of primary materials
other than copper and brass, in which case they would be classified
under HTSUS subheadings 8481.80.3040, 8481.80.3090, or 8481.80.5090. In
addition, if unassembled or incomplete frontseating service valves are
imported, the various parts or components would be classified under
HTSUS subheadings 8481.90.1000, 8481.90.3000, or 8481.90.5000. The
HTSUS subheadings are provided for convenience and customs purposes,
but the written description of the scope is dispositive.
Scope Comments
We set aside a period for interested parties to raise issues
regarding product coverage. See Antidumping Duties; Countervailing
Duties; Final Rule, 62 FR 27296, 27323 (May 19, 1997). In our
Initiation Notice, we encouraged parties to submit such comments
regarding the scope of the merchandise under investigation by April 28,
2008. On April 28, 2008, Sanhua submitted scope comments. No other
party submitted scope comments. On May 8, 2008, Petitioner submitted
rebuttal scope comments. No other party submitted rebuttal comments.
Sanhua requested that the Department limit the scope to FSVs made of
brass or copper and not include forged products with integrated feet
because the scope as written covers too broad a range of service
valves. Sanhua argues that service valves may erroneously be classified
as FSVs when they enter the United States under the current scope
description. Specifically, Sanhua contends that the scope as written
currently suggests that FSVs are made of any material. Sanhua argues
that, in fact, FSVs must stand up to certain operating conditions and
brass FSVs are the only product that meet those conditions and demands.
Petitioner argues that the Department should not consider any changes
that would limit the scope to specific material composition, mounting
type or that would attempt to remove all forged valve bodies from the
scope.
In the Initiation Notice,\7\ we stated that the scope of
merchandise includes FSVs of any size, configuration, material
composition or connection type. FSVs are classified under subheading
8481.80.1095, and also have been classified under subheading
8415.90.80.85 of the HTSUS. Additionally, we stated that it is possible
for FSVs to be manufactured out of primary materials other than copper
and brass, in which case they would be classified under HTSUS
subheadings 8481.80.3040, 8481.80.3090, or 8481.80.5090. Based upon the
above, we have preliminarily determined that the scope of the
merchandise under consideration as it is currently written clearly
describes the scope of the merchandise under consideration.
---------------------------------------------------------------------------
\7\ See Initiation Notice, 73 FR at 20251.
---------------------------------------------------------------------------
Non-Market Economy Country
For purposes of initiation, Petitioner submitted an LTFV analysis
for the PRC as an NME.\8\ Recently, the Department examined the PRC's
market status and determined that NME status should continue for the
PRC.\9\ Additionally, in recent investigations, the Department also
treated the PRC as an NME country.\10\ In accordance with section
[[Page 62954]]
771(18)(C)(i) of the Act, the NME status remains in effect until
revoked by the Department. The presumption of the NME status of the PRC
has not been revoked by the Department and, therefore, remains in
effect for purposes of this investigation.
---------------------------------------------------------------------------
\8\ See Initiation Notice, 73 FR at 20253.
\9\ See the Department's memorandum entitled, ``Antidumping Duty
Investigation of Certain Lined Paper Products from the People's
Republic of China (``China'')-China's status as a non-market economy
(``NME''),'' dated August 30, 2006. This document is available
online at: https://ia.ita.doc.gov/download/prc-nmestatus/prc-lined-
paper-memo-08302006.pdf.
\10\ See Electrolytic Manganese Dioxide from the People's
Republic of China: Final Determination of Sales at Less Than Fair
Value, 73 FR 48195 (August 18, 2008).
---------------------------------------------------------------------------
Selection of Respondents
The Department issued its Quantity and Value (``Q&V'')
questionnaire to Zhejiang DunAnn Hetian Metal Co., Ltd. (``DunAn''),
Sanhua, and Anhui Tianda Group, Ltd. (``Tianda''), exporters of FSVs
from the PRC. In its Q&V questionnaire the Department requested that
the firms provide a response on May 8, 2008. On May 8, 2008, DunAn and
Sanhua each submitted a Q&V questionnaire response. Both DunAn and
Sanhua stated that they exported FSV's to the United States during the
POI. The Department did not receive a Q&V response from Tianda. On June
30, 2008, the Department selected DunAn and Sanhua as mandatory
respondents and issued an antidumping duty questionnaire to both
companies.
Surrogate Country
Section 773(c)(1) of the Act directs the Department to base normal
value (``NV'') on the NME producer's factors of production (``FOPs''),
valued in a surrogate market economy (``ME'') country or countries
considered to be appropriate by the Department. In accordance with
section 773(c)(4) of the Act, in valuing the FOPs, the Department shall
use, to the extent possible, the prices or costs of the FOPs in one or
more ME countries that are: (1) at a level of economic development
comparable to that of the NME country; and (2) significant producers of
comparable merchandise. The sources of the surrogate factor values are
discussed under the ``Factor Valuations'' section below. See also
Factor Valuation Memorandum.\11\
---------------------------------------------------------------------------
\11\ See the Department's memorandum entitled, ``Antidumping
Duty Investigation of Frontseating Service Valves from the People's
Republic of China: Factor Valuations for the Preliminary
Determination,'' dated concurrently with this notice (``Factor
Valuation Memorandum'').
---------------------------------------------------------------------------
On September 10, 2008, the Department determined that India,
Indonesia, Thailand, the Philippines, and Colombia are countries
comparable to the PRC in terms of economic development.\12\ On
September 11, 2008, the Department requested comments on the selection
of a surrogate country from the interested parties in this
investigation. Petitioner and DunAn submitted comments on September 22,
2008. Both Petitioner and DunAn stated the Department should select
India as the surrogate country.
---------------------------------------------------------------------------
\12\``See the Department's memorandum entitled, ``Antidumping
Duty Investigation of Frontseating Service Valves (``FSVs'') from
the People's Republic of China (``PRC''): Request for a List of
Surrogate Countries'' from the office of Policy, dated September 10,
2008 (identifying the list of potential surrogate countries
comparable to the PRC in terms of economic comparability) (``Policy
Memorandum'').
---------------------------------------------------------------------------
The Department's practice is to select an appropriate surrogate
country from the Policy Memorandum based on the availability and
reliability of data from the countries that are significant producers
of comparable merchandise. In this case, we found that India is at a
level of economic development comparable to that of the PRC, is a
significant producer of comparable merchandise (i.e., FSVs) and has
publicly available and reliable data. Accordingly, we selected India as
the primary surrogate country for purposes of valuing the FOPs in the
calculation of NV because it meets the Department's criteria for
surrogate country selection.\13\ We obtained and relied upon publicly
available information wherever possible.
---------------------------------------------------------------------------
\13\``See Id.
---------------------------------------------------------------------------
In accordance with 19 CFR 351.301(c)(3)(i), for the final
determination in antidumping investigations, interested parties may
submit publicly available information to value FOPs under 19 CFR
351.408(c) within 40 days after the date of publication of this
preliminary determination.\14\
---------------------------------------------------------------------------
\14\ In accordance with 19 CFR 351.301(c)(1), for the final
determination of this investigation, interested parties may submit
factual information to rebut, clarify, or correct factual
information submitted by an interested party less than ten days
before, on, or after, the applicable deadline for submission of such
factual information. However, the Department notes that 19 CFR
351.301(c)(1) permits new information only insofar as it rebuts,
clarifies, or corrects information recently placed on the record.
The Department generally cannot accept the submission of additional,
previously absent-from-the-record alternative surrogate value
information pursuant to 19 CFR 351.301(c)(1). See Glycine from the
People's Republic of China: Final Results of Antidumping Duty
Administrative Review and Final Rescission, in Part, 72 FR 58809
(October 17, 2007) and accompanying Issues and Decision Memorandum
at Comment 2.
---------------------------------------------------------------------------
Separate Rates
In the Initiation Notice, the Department notified parties of the
recent application process by which exporters and producers may obtain
separate-rate status in NME investigations. See Initiation Notice at
20254. The process requires exporters and producers to submit an SRA.
See also Policy Bulletin 05.1.\15\ However, the standard for
eligibility for a separate rate (which is whether a firm can
demonstrate an absence of both de jure and de facto government control
over its export activities) has not changed.
---------------------------------------------------------------------------
\15\ Policy Bulletin 05.1 states: ``while continuing the
practice of assigning separate rates only to exporters, all separate
rates that the Department will now assign in its NME investigations
will be specific to those producers that supplied the exporter
during the period of investigation. Note, however, that one rate is
calculated for the exporter and all of the producers which supplied
subject merchandise to it during the period of investigation. This
practice applied both to mandatory respondents receiving an
individually calculated separate rate as well as the pool of non-
investigated firms receiving the weighted-average of the
individually calculated rates. This practice is referred to as the
application of ``combination rates'' because such rates apply to
specific combinations of exporters and one or more producers. The
cash-deposit rate assigned to an exporter will apply only to
merchandise both exported by the firm in question and produced by a
firm that supplied the exporter during the period of
investigation.'' See Policy Bulletin 05.1 at 6.
---------------------------------------------------------------------------
In proceedings involving NME countries, the Department has a
rebuttable presumption that all companies within the country are
subject to government control and thus should be assessed a single
antidumping duty rate. It is the Department's policy to assign all
exporters of merchandise subject to this investigation in an NME
country this single rate unless an exporter can demonstrate that it is
sufficiently independent so as to be entitled to a separate rate. See
Policy Bulletin 05.1. Exporters can demonstrate this independence
through the absence of both de jure and de facto government control
over export activities. The Department analyzes each entity exporting
the merchandise subject to this investigation under a test arising from
the Notice of Final Determination of Sales at Less Than Fair Value:
Sparklers from the People's Republic of China, 56 FR 20588 (May 6,
1991) (``Sparklers''), as further developed in Notice of Final
Determination of Sales at Less Than Fair Value: Silicon Carbide from
the People's Republic of China, 59 FR 22585 (May 2, 1994) (``Silicon
Carbide''). However, if the Department determines that a company is
wholly foreign-owned or located in an ME, then a separate-rate analysis
is not necessary to determine whether it is independent from government
control.
A. Separate-Rate Recipients
In this investigation, no company reported that it is wholly owned
by individuals or companies located in an ME or that it is located
outside the PRC. Therefore, we are not addressing these ownership
structures in this preliminary determination.
1. Joint Ventures between Chinese and Foreign Companies or Wholly
Chinese-Owned Companies
[[Page 62955]]
In this investigation no company reported that its ownership
structure is that of a wholly Chinese-owned company. However, both
respondents examined (i.e., DunAn and Sanhua) reported that they are
joint ventures between Chinese and foreign companies. Therefore, the
Department must analyze whether DunAn and Sanhua can demonstrate the
absence of both de jure and de facto government control over their
export activities.
a. Absence of De Jure Control
The Department considers the following de jure criteria in
determining whether an individual company may be granted a separate
rate: (1) an absence of restrictive stipulations associated with an
individual exporter's business and export licenses; (2) any legislative
enactments decentralizing control of companies; and (3) other formal
measures by the government decentralizing control of companies. See
Sparklers, 56 FR at 20589.
The evidence provided by DunAn and Sanhua supports a preliminary
finding of de jure absence of government control based on the
following: (1) an absence of restrictive stipulations associated with
the individual exporters' business and export licenses; (2) there are
applicable legislative enactments decentralizing control of the
companies; and (3) there are formal measures by the government
decentralizing control of companies. See, e.g., DunAn's and Sanhua's
SRA submissions dated June 17, 2008, and June 13, 2008, respectively.
b. Absence of De Facto Control
Typically the Department considers four factors in evaluating
whether each respondent is subject to de facto government control of
its export functions: (1) whether the export prices are set by or are
subject to the approval of a government agency; (2) whether the
respondent has authority to negotiate and sign contracts and other
agreements; (3) whether the respondent has autonomy from the government
in making decisions regarding the selection of management; and (4)
whether the respondent retains the proceeds of its export sales and
makes independent decisions regarding disposition of profits or
financing of losses. See Silicon Carbide, 59 FR at 22586-87; see also
Notice of Final Determination of Sales at Less Than Fair Value:
Furfuryl Alcohol From the People's Republic of China, 60 FR 22544,
22545 (May 8, 1995). The Department has determined that an analysis of
de facto control is critical in determining whether respondents are, in
fact, subject to a degree of government control which would preclude
the Department from assigning separate rates.
The evidence placed on the record of this investigation by DunAn
and Sanhua demonstrate an absence of de jure and de facto government
control with respect to their respective exports of the merchandise
under investigation, in accordance with the criteria identified in
Sparklers and Silicon Carbide.\16\
---------------------------------------------------------------------------
\16\ See DunAn's and Sunhua's SRAs, dated June 13, 2008.
---------------------------------------------------------------------------
B. Companies Not Receiving a Separate Rate
The Department has determined that all parties applying for a
separate rate in this segment of the proceeding have demonstrated an
absence of government control both in law and in fact (see discussion
above), and is, therefore, not denying separate-rate status to any
respondent that has applied (i.e., DunAn and Sanhua).
Facts Available and the PRC-wide Entity
Section 776(a)(1) and (2) of the Act provides that the Department
shall apply ``facts otherwise available'' if necessary information is
not on the record or an interested party or any other person (A)
withholds information that has been requested, (B) fails to provide
information within the deadlines established, or in the form and manner
requested by the Department, subject to subsections (c)(1) and (e) of
section 782 of the Act, (C) significantly impedes a proceeding, or (D)
provides information that cannot be verified as provided by section
782(i) of the Act.
Where the Department determines that a response to a request for
information does not comply with the request, section 782(d) of the Act
provides that the Department will so inform the party submitting the
response and will, to the extent practicable, provide that party the
opportunity to remedy or explain the deficiency. If the party fails to
remedy the deficiency within the applicable time limits, subject to
section 782(e) of the Act, the Department may disregard all or part of
the original and subsequent responses, as appropriate. Pursuant to
section 782(e) of the Act, the Department shall not decline to consider
submitted information if all of the following requirements are met: (1)
The information is submitted by the established deadline; (2) the
information can be verified; (3) the information is not so incomplete
that it cannot serve as a reliable basis for reaching the applicable
determination; (4) the interested party has demonstrated that it acted
to the best of its ability; and (5) the information can be used without
undue difficulties.
On April 19, 2008, the Department sent Tianda a Q&V questionnaire
requesting information on the quantity and U.S. dollar sales value of
all exports of FSVs to the United States.\17\ A response was due by
close of business on May 8, 2008. The Department did not receive a
response from Tianda.
---------------------------------------------------------------------------
\17\ See the Department's letter to all interested parties,
dated April 19, 2008.
---------------------------------------------------------------------------
We find that because Tianda failed to respond to the Department's
requests for information, it failed to demonstrate that it operates
free of government control and that it is entitled to a separate rate.
Therefore, we are treating Tianda as part of the PRC-wide entity. Based
on the above facts, the Department preliminarily determines that there
were exports of the merchandise subject to this investigation from a
PRC exporter/producer that did not respond to the Department's Q&V
questionnaire, and section 776(b) of the Act provides that, in
selecting from among the facts otherwise available, the Department may
employ an adverse inference if an interested party fails to cooperate
by not acting to the best of its ability to comply with requests for
information. See Statement of Administrative Action accompanying the
Uruguay Round Agreements Act, H.R. Rep. No. 103-316, 870 (1994)
(``SAA''). By failing to respond to the Department's Q&V questionnaire,
we preliminarily determine that the PRC-wide entity did not cooperate
to the best of its ability. Accordingly, we find that an adverse
inference is warranted for the PRC-wide entity, which includes Tianda.
Selection of the Adverse Facts Available Rate
In deciding which facts to use as adverse facts available
(``AFA''), section 776(b) of the Act and 19 CFR 351.308(c)(1) and (2)
provide that the Department may 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 selecting a rate for AFA, the Department selects a rate that
is sufficiently adverse so ``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.''\18\ It is also the
[[Page 62956]]
Department's practice to select a rate that ensures ``that the party
does not obtain a more favorable result by failing to cooperate than if
it had cooperated fully.''\19\
---------------------------------------------------------------------------
\18\ See Notice of Final Determination of Sales at Less than
Fair Value: Static Random Access Memory Semiconductors From Taiwan,
63 FR 8909, 8932 (February 23, 1998).
\19\ See Brake Rotors From the People's Republic of China: Final
Results and Partial Rescission of the Seventh Administrative Review;
Final Results of the Eleventh New Shipper Review, 70 FR 69937, 69939
(November 18, 2005), quoting SAA at 870.
---------------------------------------------------------------------------
Generally, the Department finds selecting the highest rate in any
segment of the proceeding as AFA to be appropriate.\20\ It is the
Department's practice to select, as AFA, the higher of the (a) highest
margin alleged in the petition, or (b) the highest calculated rate of
any respondent in the investigation.\21\ In the instant investigation,
as AFA, we have preliminarily assigned to the PRC-wide entity,
including Tianda, the highest rate on the record of this proceeding,
which in this case is the 55.62 percent margin from the petition.\22\
The Department preliminarily determines that this information is the
most appropriate from the available sources to effectuate the purposes
of AFA.
---------------------------------------------------------------------------
\20\ See, e.g., Certain Cased Pencils from the People's Republic
of China; Preliminary Results of Antidumping Duty Administrative
Review and Intent to Rescind in Part, 70 FR 76755, 76761 (December
28, 2005), unchanged in Certain Cased Pencils from the People's
Republic of China; Final Results and Partial Rescission of
Antidumping Duty Administrative Review, 71 FR 38366, (July 6, 2006),
and accompanying Issues and Decision Memorandum at Comment 10.
\21\ See Final Determination of Sales at Less Than Fair Value:
Certain Cold-Rolled Carbon Quality Steel Products from the People's
Republic of China, 65 FR 34660 (May 21, 2000), and accompanying
Issues and Decision Memorandum at ``Facts Available.''
\22\ See Initiation Notice.
---------------------------------------------------------------------------
The Department will consider all margins on the record at the time
of the final determination for the purpose of determining the most
appropriate AFA rate for the PRC-wide entity including Tianda.\23\
---------------------------------------------------------------------------
\23\ See Notice of Preliminary Determination of Sales at Less
Than Fair Value: Saccharin from the People's Republic of China, 67
FR 79049, 79053-54 (December 27, 2002), unchanged in Notice of Final
Determination of Sales at Less Than Fair Value: Saccharin From the
People's Republic of China, 68 FR 27530 (May 20, 2003).
---------------------------------------------------------------------------
Corroboration
Section 776(c) of the Act provides that, when the Department relies
on secondary information rather than on information obtained in the
course of an investigation as facts available, it must, to the extent
practicable, corroborate that information from independent sources
reasonably at its disposal. Secondary information is described as
``information derived from the petition that gave rise to the
investigation or review, the final determination concerning merchandise
subject to this investigation, or any previous review under section 751
concerning the merchandise subject to this investigation.''\24\ To
``corroborate'' means simply that the Department will satisfy itself
that the secondary information to be used has probative value.\25\
Independent sources used to corroborate may include, for example,
published price lists, official import statistics and customs data, and
information obtained from interested parties during the particular
investigation.\26\ To corroborate secondary information, the Department
will, to the extent practicable, examine the reliability and relevance
of the information used.\27\
---------------------------------------------------------------------------
\24\ See Final Determination of Sales at Less Than Fair Value:
Sodium Hexametaphosphate From the People's Republic of China, 73 FR
6479, 6481 (February 4, 2008), quoting SAA at 870.
\25\ See Id.
\26\ See Id.
\27\ See Tapered Roller Bearings and Parts Thereof, Finished and
Unfinished, from Japan, and Tapered Roller Bearings, Four Inches or
Less in Outside Diameter, and Components Thereof, from Japan;
Preliminary Results of Antidumping Duty Administrative Reviews and
Partial Termination of Administrative Reviews, 61 FR 57391, 57392
(November 6, 1996), unchanged in Tapered Roller Bearings and Parts
Thereof, Finished and Unfinished, From Japan, and Tapered Roller
Bearings, Four Inches or Less in Outside Diameter, and Components
Thereof, From Japan; Final Results of Antidumping Duty
Administrative Reviews and Termination in Part, 62 FR 11825 (March
13, 1997).
---------------------------------------------------------------------------
The AFA rate that the Department used is from the petition.\28\
Petitioners' methodology for calculating the United States price and NV
in the petition is discussed in the initiation notice.\29\ To
corroborate the AFA margin we have selected, we compared that margin to
the margins we found for the respondents. We found that the margin of
55.62 percent has probative value because it is in the range of margins
we found for the mandatory respondents. Accordingly, we find that the
rate of 55.62 percent is corroborated within the meaning of section
776(c) of the Act.
---------------------------------------------------------------------------
\28\ See Initiation Notice.
\29\ See Initiation Notice.
---------------------------------------------------------------------------
Consequently, we are applying a single antidumping rate--the PRC-
wide rate--to producers/exporters that failed to respond to the
Department's antidumping questionnaires, or requests for shipment
information, or did not apply for a separate rate, as applicable. The
PRC-wide rate applies to all entries of the merchandise under
investigation except for entries from respondents, DunAn and Sanhua.
These companies and their corresponding antidumping duty cash deposit
rates are listed below in the ``Preliminary Determination'' section of
this notice.
Fair Value Comparisons
To determine whether sales of FSVs to the United States by the
respondents were made at LTFV, we compared constructed export price
(``CEP'') to NV, as described in the ``Constructed Export Price'' and
``Normal Value'' sections of this notice.
Constructed Export Price
In accordance with section 772(b) of the Act, CEP is the price at
which the subject merchandise is 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 of such merchandise or by a seller
affiliated with the producer or exporter, to a purchaser not affiliated
with the producer or exporter, as adjusted under sections 772(c) and
(d) of the Act. In accordance with section 772(b) of the Act, we used
CEP for DunAn's and Sanhua's sales because the sales were made by the
U.S. affiliate in the United States.
We calculated CEP based on delivered prices to unaffiliated
purchasers in the United States.\30\ In accordance with section
772(d)(1) of the Act, we made deductions from the starting price for
billing adjustments, movement expenses, discounts and rebates. We made
deductions from the U.S. sales price for movement expenses in
accordance with section 772(c)(2)(A) of the Act. These included, where
applicable, foreign inland freight from the plant to the port of
exportation, ocean freight, U.S. customs duty, U.S. brokerage and
handling, U.S. inland freight from port to the warehouse, and
warehousing expense. In accordance with section 772(d)(1) of the Act,
the Department deducted, where applicable, commissions, credit
expenses, inventory carrying costs and indirect selling expenses from
the U.S. price, all of which relate to commercial activity in the
United States. In addition, we deducted CEP profit in accordance with
sections 772(d)(3) and 772(f) of the Act. In accordance with section
773(a) of the
[[Page 62957]]
Act, we calculated DunAn's and Sanhua's credit expenses and inventory
carrying costs based on the Federal Reserve short-term rate.
---------------------------------------------------------------------------
\30\ On October 7, 2008, DunAn submitted an unsolicited revised
Section C questionnaire response, stating that it was reporting
revised standard and actual weights for its sales of FSVs and that,
in accordance with these revised weights, it had also revised all
reported U.S. selling expenses that had been calculated based on
allocations relying on those weights. Due to the timing of this
unsolicited submission, and the magnitude of the changes, we are
unable to review this submission for purposes of the preliminary
determination. However, we will review this submission after
issuance of the preliminary determination and will address any
issues attendant to this submission at that time.
---------------------------------------------------------------------------
Normal Value
We compared NV to weighted-average CEPs in accordance with section
777A(d)(1) of the Act. Further, section 773(c)(1) of the Act provides
that the Department shall determine the NV using an FOP methodology if
the merchandise is exported from an NME and the information does not
permit the calculation of NV using home-market prices, third-country
prices, or constructed value under section 773(a) of the Act. The
Department bases NV on the FOPs because the presence of government
controls on various aspects of NMEs renders price comparisons and the
calculation of production costs invalid under its normal methodologies.
The Department's questionnaire requires that the respondent provide
information regarding the weighted-average FOPs across all of the
company's plants that produce the subject merchandise, not just the
FOPs from a single plant. This methodology ensures that the
Department's calculations are as accurate as possible.\31\
---------------------------------------------------------------------------
\31\ See, e.g., Final Determination of Sales at Less Than Fair
Value and Critical Circumstances: Certain Malleable Iron Pipe
Fittings From the People's Republic of China, 68 FR 61395 (October
28, 2003), and accompanying Issues and Decision Memorandum at
Comment 19.
---------------------------------------------------------------------------
Sanhua
Sanhua reported a quantity of brass bar consumed for the production
of self-produced semi-finished valve bodies, a quantity for its claimed
brass and copper scrap by-product offsets and quantities for the
remaining FOPs used in the production of subject merchandise. We have
determined not to grant Sanhua's requested by-product offsets for brass
scrap and copper waste because Sanhua did not properly report actual
scrap generated and consumed, despite the Department's request in a
supplemental questionnaire. See Sanhua'sSupplemental Response, dated
September 29, 2008. For the subject merchandise produced by Sanhua that
does not incorporate a semi-finished valve body from a toller, we have
calculated NV using the reported FOPs, except for the by-product
offsets for brass scrap and copper waste.
With respect to the semi-finished valve bodies produced by the
toller, Sanhua only reported the FOPs of the brass bar consumed in
production. Sanhua did not report the remaining FOPs used by its toller
for the production of semi-finished brass valve bodies. Therefore,
valuing only the brass bar would not capture costs associated with the
processing of the semi-finished valve body. For the calculation of NV
for subject merchandise using a semi-finished valve body from a toller,
we applied a surrogate value (``SV'') for semi-finished brass valve
bodies directly to the reported standard weight of the brass body.
Finally, we determined not to value the reported semi-finished valve
body because the reported weights for that input are not sufficient to
make the merchandise. See Sanhua's Preliminary Determination Analysis
Memorandum, dated concurrently with this notice.
DunAn
In its September 22, 2008, Section D, FOP database, DunAn reported
FOPs and a by-product offset for brass scrap. However, its net FOPs
(i.e, the reported FOPs less the claimed brass scrap by-product offset)
were insufficient to account for the reported weight of its finished
products. In response to a request from the Department, DunAn reviewed
its reporting methodology and submitted a revised FOP database to the
Department on October 7, 2008, claiming to have addressed this issue.
In the narrative portion of this submission, DunAn stated that it had
revised only its claimed brass scrap offset. However, upon reviewing
the October 7, 2008, FOP database, we found that DunAn had also revised
its reported brass inputs. Due to the timing of this submission, we are
unable to address these unidentified data changes with DunAn prior to
the preliminary determination. Therefore, for purposes of the
preliminary determination, as facts available, we used the FOP data
from DunAn's September 22, 2008, submission, but did not grant DunAn's
requested by-product offset for brass scrap. We will address this issue
further after issuance of the preliminary determination. For further
discussion of this issue, please see DunAn's Preliminary Determination
Analysis Memorandum.
Factor Valuations
In accordance with section 773(c) of the Act, we calculated NV
based on FOPs reported by the respondent for the POI. To calculate NV,
we multiplied the reported per-unit factor-consumption rates by
publicly available Indian SVs. In selecting the SVs, we considered the
quality, specificity, and contemporaneity of the data. As appropriate,
we adjusted input prices by including freight costs to make them
delivered prices. Specifically, we added to Indian import SVs a
surrogate freight cost using the shorter of the reported distance from
the domestic supplier to the factory of production or the distance from
the nearest seaport to the factory of production, where appropriate.
This adjustment is in accordance with the U.S. Court of Appeals for the
Federal Circuit's decision in Sigma Corp. v. United States, 117 F. 3d
1401, 1407-1408 (Fed. Cir. 1997). A detailed description of all SVs
used can be found in the Factor Valuation Memorandum.
For this preliminary determination, in accordance with the
Department's practice, we used import values from the World Trade
Atlas[supreg] online (``Indian Import Statistics''), which were
published by the Directorate General of Commercial Intelligence and
Statistics, Ministry of Commerce of India, which were reported in
rupees and are contemporaneous with the POI to calculate SVs for the
mandatory respondents' material inputs. In selecting the best available
information for valuing FOPs in accordance with section 773(c)(1) of
the Act, the Department's practice is to select, to the extent
practicable, SVs which are non-export average values, most
contemporaneous with the POI, product-specific, and tax-exclusive.\32\
---------------------------------------------------------------------------
\32\ See, e.g., Notice of Preliminary Determination of Sales at
Less Than Fair Value, Negative Preliminary Determination of Critical
Circumstances and Postponement of Final Determination: Certain
Frozen and Canned Warmwater Shrimp From the Socialist Republic of
Vietnam, 69 FR 42672, 42682 (July 16, 2004), unchanged in Final
Determination of Sales at Less Than Fair Value: Certain Frozen and
Canned Warmwater Shrimp from the Socialist Republic of Vietnam, 69
FR 71005 (December 8, 2004).
---------------------------------------------------------------------------
In those instances where we could not obtain publicly available
information contemporaneous with the POI with which to value FOPs, we
adjusted the SVs using, where appropriate, the Indian Wholesale Price
Index (``WPI''), as published in the International Financial Statistics
of the International Monetary Fund.
Furthermore, with regard to the Indian import-based SVs, we have
disregarded import prices that we have reason to believe or suspect may
be subsidized. We have reason to believe or suspect that prices of
inputs from Indonesia, South Korea, and Thailand may have been
subsidized. We have found in other proceedings that these countries
maintain broadly available, non-industry-specific export subsidies and,
therefore, it is reasonable to infer that all exports to all markets
from these countries may be subsidized.\33\ We are
[[Page 62958]]
also guided by the legislative history not to conduct a formal
investigation to ensure that such prices are not subsidized.\34\ The
Department bases its decision on information that is available to it at
the time it makes its determination. Therefore, we have not used prices
from these countries in calculating the Indian import-based SVs. In
addition, we excluded Indian import data from NME countries from our SV
calculations.\35\
---------------------------------------------------------------------------
\33\ See Notice of Final Determination of Sales at Less Than
Fair Value and Negative Final Determination of Critical
Circumstances: Certain Color Television Receivers From the People's
Republic of China, 69 FR 20594 (April 16, 2004), and accompanying
Issues and Decision Memorandum at Comment 7.
\34\ See Omnibus Trade and Competitiveness Act of 1988,
Conference Report to Accompanying H.R. 3, H.R. Rep. 100-576 at 590
(1988).
\35\ For a detailed description of all SVs used for each
respondent, see Factor Valuation Memorandum.
---------------------------------------------------------------------------
We used Indian transport information to value the inland freight
cost of the raw materials. The Department determined the best available
information for valuing truck freight to be from the following website:
https://www.infobanc.com/logistics/logtruck.htm. The logistics section
of this source contains inland truck freight rates from four major
points of origin to 25 destinations in India. The Department obtained
inland truck freight rates updated through September 2008 from each
point of origin to each destination and averaged the data accordingly.
Since this value is not contemporaneous with the POI, we deflated the
rate using the WPI. See Factor Valuation Memorandum.
We used three sources to calculate an SV for domestic brokerage
expenses. The Department averaged July 2004-June 2005 data contained in
the January 9, 2006, public version of Kejriwal Paper Ltd.'s
(``Kejriwal'') response submitted in the antidumping duty investigation
of lined paper products from India,\36\ the February 2004-January 2005
data contained in the May 24, 2005, public version of Agro Dutch
Industries Limited's (``Agro Dutch'') response submitted in the
administrative review of the antidumping duty order on certain
preserved mushrooms from India,\37\ and the December 2003-November 2004
data contained in the February 28, 2005, public version of Essar
Steel's (``Essar'') response submitted in the antidumping duty
administrative review of hot-rolled carbon steel flat products from
India.\38\ The brokerage expense data reported by Kejriwal, Agro Dutch,
and Essar in their public versions are ranged data. The Department
first derived an average per-unit amount from each source. Then the
Department adjusted each average rate for inflation. Finally, the
Department averaged the three per-unit amounts to derive an overall
average rate for the POI. See Factor Valuation Memorandum.
---------------------------------------------------------------------------
\36\ See Preliminary Determination of Sales at Less Than Fair
Value, Postponement of Final Determination, and Affirmative
Preliminary Determination of Critical Circumstances in Part: Certain
Lined Paper Products from India, 71 FR 19706 (April 17, 2006),
unchanged in Notice of Final Determination of Sales at Less Than
Fair Value, and Negative Determination of Critical Circumstances:
Certain Lined Paper Products from India, 71 FR 45012 (August 8,
2006).
\37\ See Certain Preserved Mushrooms From India: Preliminary
Results of Antidumping Duty Administrative Review, 70 FR 10597,
10599 (March 4, 2005), unchanged in Certain Preserved Mushrooms From
India: Final Results of Antidumping Duty Administrative Review, 70
FR 37757 (June 30, 2005).
\38\ See Certain Hot-Rolled Carbon Steel Flat Products From
India: Preliminary Results of Antidumping Duty Administrative
Review, 71 FR 2018, 2021 (January 12, 2006), unchanged in Certain
Hot-Rolled Carbon Steel Flat Products From India: Final Results of
Antidumping Duty Administrative Review, 71 FR 40694 (July 18, 2006).
---------------------------------------------------------------------------
For direct, indirect, and packing labor, consistent with 19 CFR
351.408(c)(3), we used the PRC regression-based wage rate as reported
on Import Administration's home page, Import Library, Expected Wages of
Selected NME Countries, revised in May 2008, available at https://
ia.ita.doc.gov/wages/. Because this regression-based wage
rate does not separate the labor rates into different skill levels or
types of labor, we have applied the same wage rate to all skill levels
and types of labor reported by the respondent.\39\ If the NME wage
rates are updated by the Department prior to issuance of the final
determination, we will use the updated wage rate in the final LTFV
determination.
---------------------------------------------------------------------------
\39\ See Factor Valuation Memorandum.
---------------------------------------------------------------------------
We valued electricity using price data for small, medium, and large
industries, as published by the Central Electricity Authority of the
Government of India in its publication titled Electricity Tariff & Duty
and Average Rates of Electricity Supply in India, dated July 2006.
These electricity rates represent actual country-wide, publicly
available information on tax-exclusive electricity rates charged to
industries in India. Since the rates are not contemporaneous with the
POI, we inflated the values using the WPI. See Factor Valuation
Memorandum.
To value factory overhead, selling, general, and administrative
expenses (``SG&A'') and profit, we used audited financial statements of
Carbac Holdings Ltd. (``Carbac''), an Indian brass valve producer;
Upadhaya Valves Manufacturers Private Limited (``Upadhaya''), an Indian
producer of valves and fittings; and Oswal Valves Pvt. Ltd.
(``Oswal''), an Indian producer of valves. We did not rely upon three
company's financial statements that were placed on the record, namely
the financial statements of Brassomatic Pvt. Ltd. (``Brassomatic''),
Larsen & Toubro (``L&T''), and Valve Power Engineers Private Limited
(``Valve Power''). We did not rely upon the Brassomatic financial
statement because it did not report a profit. It is the Department's
practice to disregard financial statements with zero profit when there
are financial statements on the record of other surrogate companies
that have earned a profit. See Notice of Initiation of Antidumping Duty
Investigations: Electrolytic Manganese Dioxide from Australia and the
People's Republic of China, 72 FR 52850 (September 17, 2007), citing
Certain Frozen Warmwater Shrimp from the Socialist Republic of Vietnam:
Final Results of the First Antidumping Administrative Review and First
New Shipper Review, 72 FR 52052 (September 12, 2007), and accompanying
Issues and Decision Memorandum at Comment 2, section B. Additionally,
we did not rely upon L&T's financial statement because L&T's financial
statement identifies mixed operations and a significant portion of its
business activities is not related to production of comparable
merchandise.\40\ It is the Department's practice to disregard financial
statements with mixed operations and significant operations unrelated
to production of comparable merchandise where there are sufficient
financial statements on the record for producers of comparable
merchandise. See Chlorinated Isocyanurates from the People's Republic
of China: Final Results of Antidumping Duty Administrative Review, 73
FR 159 (January 2, 2008), and accompanying Issues and Decision
Memorandum at Comment 10. Further, we did not rely upon Valve Power's
financial statement because Valve Power is not a producer of comparable
merchandise. Valve Power stated in its financial statement that ``the
company is in the business of production & sales of manual operated
quarter turn gearboxes required to open & close valves.'' It is the
Department's practice to disregard financial statements that indicate
that the company is not a producer of identical or comparable
merchandise. See Wooded Bedroom Furniture from the People's Republic of
China: Final Results of Antidumping Duty Administrative Review and New
[[Page 62959]]
Shipper Review, 73 FR 49162 (August 20, 2008), and accompanying Issues
and Decision Memorandum at Comment 1C. See Factor Valuation Memorandum
for a full discussion of the calculation of Carbac's, Upadhaya's,
Oswal's ratios.
---------------------------------------------------------------------------
\40\ See DunAn's September 29, 2009, submission at Exhibit 9C.
---------------------------------------------------------------------------
The Department valued water using data from the Maharashtra
Industrial Development Corporation (www.midcindia.org) because it
includes a wide range of industrial water tariffs. This source provides
386 industrial water rates within the Maharashtra province from June
2003: 193 for the ``inside industrial areas'' usage category and 193
for the ``outside industrial areas'' usage category. Because the value
was not contemporaneous with the POI, we adjusted the rate for
inflation.
Post-Preliminary Determination Supplemental Questionnaire
In reviewing Sanhua's and DunAn's original and supplemental
questionnaire responses, we have determined that certain reported items
require additional supplemental information. We expect to issue post-
preliminary determination supplemental questionnaires to both Sanhua
and DunAn to address these and other deficiencies.
Critical Circumstances
A. DunAn and Sanhua
On September 9, 2008, Petitioner alleged that there is a reasonable
basis to believe or suspect that critical circumstances exist with
respect to the antidumping investigation of FSVs from the PRC. Because
Petitioner submitted its critical circumstances allegation more than 20
days before the preliminary determination, the Department is issuing a
preliminary finding of critical circumstances with its preliminary
determination.\41\ Section 733(e)(1) of the Act provides that, upon
receipt of a timely allegation of critical circumstances, the
Department will determine whether there is a reasonable basis to
believe or suspect that: (A)(i) there is a history of dumping and
material injury by reason of dumped imports in the United States or
elsewhere of the subject merchandise or (ii) the person by whom, or for
whose account, the merchandise was imported knew or should have known
that the exporter was selling the subject merchandise at less than its
fair value and that there was likely to be material injury by reason of
such sales, and (B) there have been massive imports of the subject
merchandise over a relatively short period.
---------------------------------------------------------------------------
\41\See 19 CFR 351.206(c)(2)(ii).
---------------------------------------------------------------------------
To determine whether the above statutory criteria have been
satisfied, the Department examined the following information: (1)
evidence presented in Petitioner's September 9, 2008, submission; (2)
evidence obtained since the initiation of the LTFV investigation (i.e.,
import statistics obtained from the ITC Data Web); and (3) the ITC's
preliminary material injury determination.\42\
---------------------------------------------------------------------------
\42\ See ITC Preliminary Determination.
---------------------------------------------------------------------------
To determine whether a history of dumping and material injury
exists, the Department generally considers current or previous
antidumping duty orders on subject merchandise from the country in
question in the United States and current orders in any other country
with regard to imports of subject merchandise. Petitioner makes no
statement concerning a history of dumping with respect to FSVs from the
PRC in the United States or elsewhere. Moreover, the Department is not
aware of any other antidumping order in the United States or in any
country on FSVs from the PRC. Therefore, the Department finds no
history of injurious dumping of FSVs from the PRC in accordance with
section 733(e)(1)(A)(i) of the Act.
To determine whether an importer knew, or should have known, that
the exporter was selling subject merchandise at LTFV in accordance with
section 733(e)(1)(A)(ii) of the Act, the Department must rely on the
facts before it at the time the determination is made. The Department
normally considers margins of 25 percent or more for export price
(``EP'') sales and 15 percent or more for CEP sales sufficient to
impute importer knowledge of sales at LTFV.\43\ Petitioner suggests the
use of the margins used by the Department at the investigation
initiation.\44\ However, we find the use of the alleged rates in the
Petition to be unnecessary in this case because the Department's
preliminary determination has found margins of 26.72 percent for DunAn,
and 15.41 percent for Sanhua. Based on these margins, the Department
preliminarily finds that both DunAn's and Sanhua's importers knew, or
should have known, that DunAn and Sanhua were selling subject
merchandise at LTFV.
---------------------------------------------------------------------------
\43\ See, e.g., Notice of Final Determination of Sales at Less
Than Fair Value and Affirmative Final Determination of Critical
Circumstances: Glycine from Japan, 72 FR 67271 (November 28, 2007),
and accompanying Issues and Decisions Memorandum at Comment 4.
\44\ See Petitioner's September 9, 2008, submission at 3-4,
citing Initiation Notice.
---------------------------------------------------------------------------
To determine whether an importer knew or should have known that
there was likely to be material injury caused by reason of such imports
consistent with section 733(e)(1)(A)(ii) of the Act, the Department
normally will look to the preliminary injury determination of the ITC.
If the ITC finds a reasonable indication of present material injury to
the relevant U.S. industry, the Department will determine that a
reasonable basis exists to impute importer knowledge that material
injury is likely by reason of such imports.\45\ In the instant case,
the ITC preliminarily determined that material injury to the domestic
industry exists due to imports of FSVs from the PRC, which are alleged
to be sold in the United States at LTFV and, on this basis, the
Department imputes knowledge of the likelihood of injury to Petitioner.
See ITC Preliminary Determination.
---------------------------------------------------------------------------
\45\ See, e.g., Final Determination of Sales at Less Than Fair
Value: Certain Cut-To-Length Carbon Steel Plate from the People's
Republic of China, 62 FR 61964 (November 20, 1997).
---------------------------------------------------------------------------
As DunAn and Sanhua meet the first prong of the critical
circumstances test according to section 733(e)(1)(A)(i) of the Act, the
Department must examine whether imports from DunAn and Sanhua were
massive over a relatively short period. Section 733(e)(1)(B) of the Act
provides that the Department will preliminarily determine that critical
circumstances exist if there is a reasonable basis to believe or
suspect that there have been massive imports of the subject merchandise
over a relatively short period.
Section 351.206(h)(1) of the Department's regulations provides
that, in determining whether imports of the subject merchandise have
been ``massive,'' the Department will normally examine (i) the volume
and value of the imports, (ii) seasonal trends, and (iii) the share of
domestic consumption accounted for by the imports. In addition, 19 CFR
351.206(h)(2) provides that, ``In general, unless the imports during
the relatively short period . . . have increased by at least 15 percent
over the imports during an immediately preceding period of comparable
duration, the Secretary will not consider the imports massive.''
Section 351.206(i) of the Department's regulations defines
``relatively short period'' as generally the period beginning on the
date the proceeding begins (i.e., the date the petition is filed) and
ending at least three months later. This section provides further that,
if the Department ``finds that importers, or exporters or producers,
had reason to believe, at some time prior to the beginning of the
proceeding, that a proceeding was likely,'' the Department
[[Page 62960]]
may consider a period of not less than three months from that earlier
time. The Department normally compares the import volumes of the
subject merchandise for at least three months immediately preceding the
filing of the petition (``base period'') to a comparable period of at
least three months following the filing of the petition (``comparison
period''). Imports normally will be considered massive when imports
during the comparison period have increased by 15 percent or more
compared to imports during the base period.\46\
---------------------------------------------------------------------------
\46\ See 19 CFR 351.206(h)(2).
---------------------------------------------------------------------------
Petitioner based its allegation of critical circumstances in this
investigation on the increase in imports of FSVs that began with the
filing of the antidumping duty petition on March 19, 2008. The
Department's practice is to rely upon the longest period for which
informa
