Citric Acid and Certain Citrate Salts from Canada: Notice of Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination, 70324-70328 [E8-27621]

Download as PDF 70324 Federal Register / Vol. 73, No. 225 / Thursday, November 20, 2008 / Notices be due 120 days after publication of the preliminary results. We are issuing and publishing this notice in accordance with section 751(a)(3)(A) of the Act and 19 CFR 351.213(h)(2). Dated: November 14, 2008. Stephen J. Claeys, Deputy Assistant Secretary for Import Administration. [FR Doc. E8–27623 Filed 11–19–08; 8:45 am] BILLING CODE 3510–DS–S DEPARTMENT OF COMMERCE International Trade Administration [A–122–853] Citric Acid and Certain Citrate Salts from Canada: Notice of Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The U.S. Department of Commerce (the Department) preliminarily determines that citric acid and certain citrate salts (citric acid) from Canada are being, or are likely to be, sold in the United States at less than fair value (LTFV), as provided in section 733(b) of the Tariff Act of 1930, as amended (the Act). The estimated margins of sales at LTFV are listed in the ‘‘Suspension of Liquidation’’ section of this notice. Interested parties are invited to comment on this preliminary determination. Pursuant to a request from the respondent, we are postponing for 60 days the final determination and extending 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. EFFECTIVE DATE: November 20, 2008. FOR FURTHER INFORMATION CONTACT: Terre Keaton Stefanova or Rebecca Trainor, AD/CVD Operations, Office 2, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone (202) 482–1280 and (202) 482–4007, respectively. SUPPLEMENTARY INFORMATION: rwilkins on PROD1PC63 with NOTICES AGENCY: Background On May 5, 2008, the Department initiated the antidumping duty investigation of citric acid from Canada. See Citric Acid and Certain Citrate Salts from Canada and the People’s Republic VerDate Aug<31>2005 18:26 Nov 19, 2008 Jkt 217001 of China: Initiation of Antidumping Duty Investigations, 73 FR 27492 (May 13, 2008) (Initiation Notice). The petitioners in this investigation are Archer Daniels Midland Company, Cargill, Incorporated, and Tate & Lyle Americas, Inc. The Department set aside a period of time for parties to raise issues regarding product coverage and encouraged all parties to submit comments within 20 calendar days of publication of the Initiation Notice. See Initiation Notice, 73 FR at 27493. See also Antidumping Duties; Countervailing Duties, 62 FR 27296, 27323 (May 19, 1997). For further details, see the ‘‘Scope Comments’’ section of this notice, below. The Department also set aside a time for parties to comment on product characteristics for use in the antidumping duty questionnaire. On May 27, 2008, we received product characteristic comments from the petitioners. In June 2008, we received comments from Shandong TTCA Co., Ltd (TTCA), and Jungbunzlauer Technology GMBH & Co KG, (JBLT) regarding the petitioners’ product characteristic comments. Also in June 2008, the petitioners filed comments in response to TTCA’s submission. For an explanation of the product–comparison criteria used in this investigation, see the ‘‘Product Comparisons’’ section of this notice, below. On June 11, 2008, the International Trade Commission (ITC) published its affirmative preliminary determination that there is a reasonable indication that imports of citric acid and certain citrate salts from Canada are materially injuring the U.S. industry, and the ITC notified the Department of its finding. See Citric Acid and Certain Citrate Salts from Canada and China; Determinations, Investigation Nos. 701– TA–456 and 731–TA–1151–1152, 73 FR 33115 (June 11, 2008). On June 17, 2008, we selected JBLT as the sole mandatory respondent in this investigation. See Memorandum from James Maeder, Office Director, to Stephen J. Claeys, Deputy Assistant Secretary, entitled: ‘‘Antidumping Duty Investigation of Citric Acid and Certain Citrate Salts from Canada - Selection of Respondents for Individual Review,’’ dated June 17, 2008. We subsequently issued the antidumping questionnaire to JBLT on June 26, 2008. On August 19, 2008, the petitioners made a timely request pursuant to section 733(c)(1)(A) of the Act and 19 CFR 351.205(e) for a 50–day postponement of the preliminary determination. On August 29, 2008, pursuant to section 733(c)(1)(A) of the Act, the Department postponed the preliminary PO 00000 Frm 00016 Fmt 4703 Sfmt 4703 determination of this investigation until November 12, 2008. See Citric Acid and Certain Citrate Salts from Canada and the People’s Republic of China: Postponement of Preliminary Determinations of Antidumping Duty Investigations, 73 FR 50941 (August 29, 2008). In August and September 2008, we received JBLT’s questionnaire responses. In September and October 2008, we issued supplemental questionnaires, and we received JBLT’s responses to these questionnaires in October and November 2008. We note that JBLT’s questionnaire response that was due on November 7, 2008, was not received in time for consideration in the preliminary determination, but will be considered in the final determination. On October 22, 2008, JBLT requested that in the event of an affirmative preliminary determination in this investigation, the Department: 1) postpone its final determination by 60 days in accordance with 735(a)(2)(A) of the Act and 19 CFR 351.210(b)(2)(ii); and 2) extend the application of the provisional measures prescribed under 19 CFR 351.210(e)(2) from a four–month period to a six–month period. On October 24, 2008, the petitioner requested that in the event of a negative preliminary determination in this investigation, the Department postpone the final determination by 60 days. For further discussion, see the ‘‘Postponement of Final Determination and Extension of Provisional Measures’’ section of this notice, below. On October 28, 2008, the petitioners submitted comments for consideration in the preliminary determination. Period of Investigation The period of investigation (POI) is April 1, 2007, to March 31, 2008. This period corresponds to the four most recent fiscal quarters prior to the month of the filing of the petition. See 19 CFR 351.204(b)(1). Scope of Investigation The scope of this investigation includes all grades and granulation sizes of citric acid, sodium citrate, and potassium citrate in their unblended forms, whether dry or in solution, and regardless of packaging type. The scope also includes blends of citric acid, sodium citrate, and potassium citrate; as well as blends with other ingredients, such as sugar, where the unblended form(s) of citric acid, sodium citrate, and potassium citrate constitute 40 percent or more, by weight, of the blend. The scope of this investigation also includes all forms of crude calcium citrate, including dicalcium citrate E:\FR\FM\20NON1.SGM 20NON1 Federal Register / Vol. 73, No. 225 / Thursday, November 20, 2008 / Notices rwilkins on PROD1PC63 with NOTICES monohydrate, and tricalcium citrate tetrahydrate, which are intermediate products in the production of citric acid, sodium citrate, and potassium citrate. The scope of this investigation does not include calcium citrate that satisfies the standards set forth in the United States Pharmacopeia and has been mixed with a functional excipient, such as dextrose or starch, where the excipient constitutes at least 2 percent, by weight, of the product. The scope of this investigation includes the hydrous and anhydrous forms of citric acid, the dihydrate and anhydrous forms of sodium citrate, otherwise known as citric acid sodium salt, and the monohydrate and monopotassium forms of potassium citrate. Sodium citrate also includes both trisodium citrate and monosodium citrate, which are also known as citric acid trisodium salt and citric acid monosodium salt, respectively. Citric acid and sodium citrate are classifiable under 2918.14.0000 and 2918.15.1000 of the Harmonized Tariff Schedule of the United States (HTSUS), respectively. Potassium citrate and crude calcium citrate are classifiable under 2918.15.5000 and 3824.90.9290 of the HTSUS, respectively. Blends that include citric acid, sodium citrate, and potassium citrate are classifiable under 3824.90.9290 of the HTSUS. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the merchandise is dispositive. Scope Comments In accordance with the preamble to the Department’s regulations (see Antidumping Duties; Countervailing Duties, 62 FR 27296, 27323 (May 19, 1997)), in our Initiation Notice we set aside a period of time for parties to raise issues regarding product coverage, and encouraged all parties to submit comments within 20 calendar days of publication of the Initiation Notice. On May 23, 2008, and June 3, 2008, respectively, Chemrom Inc. and L. Perrigo Company timely filed comments concerning the scope of this investigation and the concurrent antidumping duty and countervailing duty investigation of citric acid and certain citrate salts from the People’s Republic of China. The petitioners responded to these comments on June 16, 2008. On August 6, 2008, the Department issued a memorandum to the file regarding the petitioners’ proposed amendments to the scope of the investigations. In response, on August 11, 2008, L. Perrigo Company and the petitioners submitted comments to VerDate Aug<31>2005 18:26 Nov 19, 2008 Jkt 217001 provide clarification of the term ‘‘unrefined’’ calcium citrate. We analyzed the comments of the interested parties regarding the scope of this investigation. See September 10, 2008, Memorandum to Stephen J. Claeys, Deputy Assistant Secretary for Import Administration, re: Antidumping Duty Investigations of Citric Acid and Certain Citrate Salts from Canada and the People’s Republic of China (PRC), and Countervailing Duty Investigation of Citric Acid and Certain Citrates Salts from the PRC, ‘‘Whether to Amend the Scope of these Investigations to Exclude Monosodium Citrate and to Further Define the Product Referred to as Unrefined Calcium Citrate’’’ (Scope Memo). Our position on these comments, as set out in the Scope Memo, are incorporated in the ‘‘Scope of the Investigation’’ section above. Product Comparisons We have taken into account the comments that were submitted by the interested parties concerning product– comparison criteria. In accordance with section 771(16) of the Act, all products produced by the respondent covered by the description in the ‘‘Scope of Investigation’’ section, above, and sold in Canada during the POI are considered to be foreign like product for purposes of determining appropriate product comparisons to U.S. sales. We have relied on four criteria to match U.S. sales of subject merchandise to comparison–market sales of the foreign like product: 1) type, 2) form, 3) grade, and 4) particle size. Where there were no sales of identical merchandise in the home market made in the ordinary course of trade to compare to U.S. sales, we compared U.S. sales to the next most similar foreign like product on the basis of the characteristics listed above. Date of Sale The Department normally will use the date of invoice, as recorded in the producer’s or exporter’s records kept in the ordinary course of business, as the date of sale. However, the Department’s regulations provide that the Department may use a date other than the date of invoice if the Secretary is satisfied that a different date better reflects the date on which the exporter or producer establishes the material terms of sale (e.g., price and quantity). See 19 CFR 351.401(i); see also Allied Tube and Conduit Corp. v. United States, 132 F. Supp. 2d 1087, 1090–92 (CIT 2001). In this case, JBLT indicated in its questionnaire responses that it made certain sales subject to long–term contracts in both the United States and Canada during the POI. For the sales PO 00000 Frm 00017 Fmt 4703 Sfmt 4703 70325 covered by these agreements, JBLT reported the contract date as the date of sale in its home market and U.S. sales listings, claiming that the material terms of sale were fixed at the time these contracts were signed. For all other sales that were not covered by these agreements, JBLT reported the date of invoice as the date of sale. In its responses to the Department’s questionnaires, JBLT provided sample documentation of the types of long–term contracts that were in effect during the POI, and a detailed explanation of the nature of these agreements. JBLT stated that: 1) in some instances the invoice price differed from the price established in the contract, usually as a result of extra services being provided to the customer that were not covered by the contract1; 2) customers might change delivery destinations, packaging, granulation, or lead times after a contract was signed, which would result in a change to the price; and 3) the contracts were not ‘‘take or pay’’ contracts; therefore, the actual volumes sold for the contracted period might be more or less than the contracted volumes. See JBLT’s October 15, 2008, Supplemental Questionnaire Response at 6–9. As the information on the record indicates that the material terms of sale (e.g., price and quantity) are subject to change after the date the sales contracts are signed, we preliminary determine that the invoice date better reflects the date on which the producer/exporter established the material terms of sale. Therefore, for purposes of the preliminary determination, we used the invoice date as the date of sale for all home market and U.S. sales, in accordance with our normal practice. Fair Value Comparisons To determine whether sales of citric acid from Canada to the United States were made at LTFV, we compared the constructed export price (CEP)2 to normal value (NV), as described in the ‘‘Constructed Export Price’’ and ‘‘Normal Value’’ sections of this notice. In accordance with section 777A(d)(1) of the Act, we compared POI weighted– average CEPs to POI weighted–average NVs. Constructed Export Price In accordance with section 772(b) of the Act, we calculated CEP for those sales where the subject merchandise 1 Such changes to price between date of contract and date of invoice are evident in JBLT’s revised home market and U.S. sales databases submitted on October 14, 2008. 2 All of JBLT’s sales in the U.S. market during the POI were CEP sales. E:\FR\FM\20NON1.SGM 20NON1 70326 Federal Register / Vol. 73, No. 225 / Thursday, November 20, 2008 / Notices was first sold (or agreed to be sold) in the United States before or after the date of importation by or for the account of the producer or exporter of such merchandise, or by a seller affiliated with the producer or exporter, to a purchaser not affiliated with the producer or exporter. We based CEP on packed, ex–factory or delivered prices to unaffiliated purchasers in the United States. When appropriate, we adjusted the starting prices for billing adjustments, rebates and interest revenue, in accordance with 19 CFR 351.401(c). We made deductions for movement expenses, where appropriate, in accordance with section 772(c)(2)(A) of the Act; these expenses included foreign inland freight from the plant to the port of exportation, foreign inland insurance, foreign brokerage and handling, U.S. brokerage and handling, U.S. inland freight from port to warehouse, U.S. warehousing, U.S. inland freight from warehouse to the unaffiliated customer, and U.S. inland insurance. In accordance with section 772(d)(1) of the Act and 19 CFR 351.402(b), we deducted those selling expenses associated with economic activities occurring in the United States, including direct selling expenses (i.e., credit expenses), and indirect selling expenses (including inventory carrying costs). We also deducted from CEP an amount for profit in accordance with sections 772(d)(3) and (f) of the Act. For discussion of adjustments made to JBLT’s reported U.S. sales data, see Memorandum to The File entitled: ‘‘Preliminary Determination Margin Calculation for Jungbunzlauer Technology GMBH & Co KG (JBLT),’’ dated November 12, 2008. Normal Value rwilkins on PROD1PC63 with NOTICES A. Home Market Viability and Comparison–Market Selection To determine whether there is a sufficient volume of sales in the home market to serve as a viable basis for calculating NV (i.e., the aggregate volume of home market sales of the foreign like product is equal to or greater than five percent of the aggregate volume of U.S. sales), we compared JBLT’s volume of home market sales of the foreign like product to its volume of U.S. sales of the subject merchandise. See section 773(a)(1)(C) of the Act. Based on this comparison, we determined that JBLT had a viable home market during the POI. Consequently, we based NV on home market sales. B. Level of Trade In accordance with section 773(a)(1)(B) of the Act, to the extent VerDate Aug<31>2005 18:26 Nov 19, 2008 Jkt 217001 practicable, we determine NV based on sales in the comparison market at the same level of trade (LOT) as the export price (EP) or CEP. Pursuant to 19 CFR 351.412(c)(1), the NV LOT is based on the starting price of the sales in the comparison market or, when NV is based on constructed value, the starting price of the sales from which we derive selling, general and administrative expenses, and profit. For EP sales, the U.S. LOT is based on the starting price of the sales in the U.S. market, which is usually from exporter to importer. For CEP sales, the U.S. LOT is based on the starting price of the U.S. sales, as adjusted under section 772(d) of the Act, which is from the exporter to the importer. To determine whether NV sales are at a different LOT than EP or CEP sales, we examine stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated customer. See 19 CFR 351.412(c)(2). If the comparison–market sales are at a different LOT, and the difference affects price comparability, as manifested in a pattern of consistent price differences between the sales on which NV is based and comparisonmarket sales at the LOT of the export transaction, we make an LOT adjustment under section 773(a)(7)(A) of the Act. Finally, for CEP sales, if the NV level is more remote from the factory than the CEP level and there is no basis for determining whether the difference in levels between NV and CEP affects price comparability, we adjust NV under section 773(a)(7)(B) of the Act (the CEP–offset provision). See Notice of Final Determination of Sales at Less Than Fair Value: Certain Cut–to-Length Carbon Steel Plate from South Africa, 62 FR 61731 - 61733 (Nov. 19, 1997). In this investigation, we obtained information from JBLT regarding the marketing stages involved in making its reported home market and U.S. sales, including a description of the selling activities performed by the respondent and its affiliates for each channel of distribution. During the POI, JBLT reported that it sold citric acid to end–users and distributors through two channels of distribution in both the U.S. and home markets. JBLT stated that its selling process was basically the same for all channels of distribution. As the details of JBLT’s reported selling functions for each channel of distribution are business proprietary, our analysis of these selling functions for purposes of determining whether different LOTs exist is contained in a separate memorandum to James Maeder, Director, AD/CVD Operations Office 2, PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 from the Team entitled ‘‘Preliminary Level–of-Trade Analysis,’’ dated November 12, 2008. Based on our analysis, we find that the selling functions JBLT performed for each of its channels of distribution in the U.S. market were essentially the same, but for one selling function which we determined was not sufficient to warrant an LOT distinction between these channels. Therefore, we determined preliminarily that there is only one LOT (for CEP sales) in the U.S. market. Similarly, we found that the selling functions that JBLT (and its affiliates) performed for each of the channels of distribution in the home market were essentially the same, with the exception of certain selling activities which we determined were not sufficient to warrant a LOT distinction between these channels. Therefore, we determined preliminarily that there is only one LOT in the home market. In comparing the home market LOT to the CEP LOT, we found that the selling activities performed by JBLT for its CEP sales were significantly fewer than the selling activities that it performed for its home market sales, and that the home– market LOT was more remote from the factory than the CEP LOT. Accordingly, we considered the CEP LOT to be different from the home–market LOT and to be at a less advanced stage of distribution than the home–market LOT. Therefore, we could not match CEP sales to sales at the same LOT in the home market, nor could we determine an LOT adjustment based on JBLT’s home market sales because there is only one LOT in the home market, and it is not possible to determine if there is a pattern of consistent price differences between the sales on which NV is based and home market sales at the LOT of the export transaction. See section 773(a)(7)(A) of the Act. Furthermore, we have no other information that provides an appropriate basis for determining an LOT adjustment. Consequently, because the data available do not form an appropriate basis for making an LOT adjustment but the home market LOT is at a more advanced stage of distribution than the CEP LOT, we made a CEP offset to NV in accordance with section 773(a)(7)(B) of the Act. The CEP offset is calculated as the lesser of: (1) the indirect selling expenses incurred on the home market sales, or (2) the indirect selling expenses deducted from the starting price in calculating CEP. C. Cost of Production Analysis Based on our analysis of the petitioners’ sales below cost of production (COP) allegation filed in the E:\FR\FM\20NON1.SGM 20NON1 Federal Register / Vol. 73, No. 225 / Thursday, November 20, 2008 / Notices petition,3 we found reasonable grounds to believe or suspect that citric acid sales were made in Canada at prices below the COP, and initiated a country– wide cost investigation. See section 773(b)(2)(A)(i) of the Act and Initiation Notice at 27494. Accordingly, pursuant to section 773(b) of the Act, we conducted a sales–below-cost investigation to determine whether JBLT’s sales were made at prices below their respective COPs. 1. Calculation of Cost of Production In accordance with section 773(b)(3) of the Act, we calculated COP based on the sum of the cost of materials and fabrication for the foreign like product, plus an amount for general and administrative expenses (G&A), interest expenses, and home market packing costs (see ‘‘Test of Home Market Sales Prices’’ section below for treatment of home market selling expenses and packing costs). We relied on the COP data submitted by JBLT in its October 27, 2008, supplemental response to section D of the questionnaire, except where noted below. We adjusted the total cost of manufacturing for a major input used in the production of citric acid purchased from an affiliated company to reflect the higher of transfer price, market price, or cost in accordance with section 773(f)(3) of the Act. We recalculated the G&A expense ratio to include capital tax and consulting services. We applied the revised G&A expense ratio and the financial expense ratio to the total cost of manufacturing before our major input adjustment. For further discussion, see Memorandum from James Balog to Neal Halper, Director, Office of Accounting, Cost of Production and Constructed Value Calculation Adjustments for the Preliminary Determination – Jungbunzlauer Technology GMBH & Co KG dated November 12, 2008. rwilkins on PROD1PC63 with NOTICES 2. Test of Comparison–Market Sales Prices On a product–specific basis, we compared the adjusted weighted– average COP to the home market sales of the foreign like product, as required under section 773(b) of the Act, to determine whether the sale prices were below the COP. For purposes of this comparison, we used the COP exclusive of selling and packing expenses. The prices were adjusted for billing adjustments and interest revenue, and were exclusive of any applicable 3 See the Petition on Citric Acid and Certain Citrate Salts from Canada, Vol. II at 4-9, filed on April 14, 2008. VerDate Aug<31>2005 18:26 Nov 19, 2008 Jkt 217001 movement charges, direct and indirect selling expenses, and packing expenses. 3. Results of the COP Test Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 20 percent of the respondent’s sales of a given product were at prices less than the COP, we do not disregard any below– cost sales of that product because we determined that the below–cost sales were not made in ‘‘substantial quantities.’’ Where 20 percent or more of the respondent’s sales of a given product during the POI were at prices less than COP, we determine that such sales have been made in ‘‘substantial quantities.’’ See section 773(b)(2)(C) of the Act. Further, we determine that the sales were made within an extended period of time, in accordance with section 773(b)(2)(B) of the Act, because we examine below–cost sales occurring during the entire POI. In such cases, because we compare prices to POI– average costs, we also determine that such sales were not made at prices which would permit recovery of all costs within a reasonable period of time, in accordance with section 773(b)(2)(D) of the Act. In this case, we found that, for certain specific products, more than 20 percent of JBLT’s sales were at prices less than the COP and, in addition, such sales did not provide for the recovery of costs within a reasonable period of time. We therefore excluded these sales and used the remaining sales as the basis for determining NV, in accordance with section 773(b)(1) of the Act. D. Calculation of Normal Value Based on Comparison–Market Prices We based NV for JBLT on packed, ex– factory or delivered prices to unaffiliated customers in the home market. We made adjustments to the starting price, where appropriate, for billing adjustments and interest revenue in accordance with 19 CFR 351.401(c). We made deductions, where appropriate, for movement expenses, including inland freight and inland insurance, under section 773(a)(6)(B)(ii) of the Act. Pursuant to section 773(a)(6)(C)(iii) of the Act and 19 CFR 351.410(b), we made, where appropriate, circumstance–of-sale adjustments for imputed credit expenses. We also deducted home market packing costs and added U.S. packing costs, in accordance with sections 773(a)(6)(A) and (B) of the Act. Finally, we made a CEP offset pursuant to section 773(a)(7)(B) of the Act and 19 CFR 351.412(f). We calculated the CEP offset as the lesser of the indirect selling PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 70327 expenses on the home–market sales or the indirect selling expenses deducted from the starting price in calculating CEP. Currency Conversion It is our normal practice to make currency conversions into U.S. dollars in accordance with section 773A(a) of the Act based on exchange rates in effect on the dates of the U.S. sales, as certified by the Federal Reserve Bank. In the antidumping questionnaire, we instructed JBLT to report prices and expenses in the currency in which they were incurred. Nevertheless, in this case, JBLT reported data that had been converted from multiple currencies into Canadian dollars (CAD) in the home market, and U.S. dollars (USD) in the U.S. market because its company–wide electronic data processing system automatically converts all foreign currency transactions into the currency of the respective JBL Group entity at the moment of posting. According to JBLT, the entry of data and the currency conversion is a simultaneous process in its accounting system. As a result, its system does not retain the original foreign currency amount in the sales database or in the general ledger. See JBLT’s October 15, 2008, supplemental questionnaire response at pages 4–6. Because it appears that the currency conversion process is a company–wide procedure that is done in the normal course of business, we have accepted JBLT’s data as reported for the preliminary determination. However, at verification we intend to examine JBLT’s accounting system, and the reasonableness of its price and expense reporting based on this system. Verification As provided in section 782(i)(1) of the Act, we intend to verify the information relied upon in making our final determination for JBLT. Suspension of Liquidation In accordance with section 733(d)(2) of the Act, we will direct Customs and Border Protection (CBP) to suspend liquidation of all entries of citric acid from Canada that are entered, or withdrawn from warehouse, for consumption on or after the date of publication of this notice in the Federal Register. We will also instruct CBP to require a cash deposit or the posting of a bond equal to the weighted–average dumping margins, as indicated in the chart below. These suspension–ofliquidation instructions will remain in effect until further notice. The weighted–average dumping margins are as follows: E:\FR\FM\20NON1.SGM 20NON1 70328 Federal Register / Vol. 73, No. 225 / Thursday, November 20, 2008 / Notices Public Comment Interested parties are invited to comment on the preliminary determination. Interested parties may Jungbunzlauer Technology submit case briefs to the Department no GMBH & Co KG ...................... 20.88 later than seven days after the date of All–Others ................................... 20.88 the issuance of the last verification report in this proceeding. Rebuttal All–Others Rate briefs, the content of which is limited to the issues raised in the case briefs, must Section 735(c)(5)(A) of the Act be filed within five days from the provides that the estimated ‘‘All Others’’ deadline date for the submission of case rate shall be an amount equal to the briefs. A list of authorities used, a table weighted average of the estimated of contents, and an executive summary weighted–average dumping margins of issues should accompany any briefs established for exporters and producers submitted to the Department. Executive individually investigated, excluding any summaries should be limited to five zero or de minimis margins, and any pages total, including footnotes. Further, margins determined entirely under we request that parties submitting briefs section 776 of the Act. JBLT is the only and rebuttal briefs provide the respondent in this investigation for Department with a copy of the public which the Department calculated a version of such briefs on diskette. In company–specific rate. Therefore, for accordance with section 774 of the Act, purposes of determining the all–others the Department will hold a public rate and pursuant to section 735(c)(5)(A) hearing, if timely requested, to afford of the Act, we are using the weighted– interested parties an opportunity to average dumping margin calculated for comment on arguments raised in case or JBLT, as referenced above. See, e.g., rebuttal briefs, provided that such a Notice of Final Determination of Sales hearing is requested by an interested at Less Than Fair Value: Stainless Steel party. If a timely request for a hearing Sheet and Strip in Coils From Italy, 64 is made in this investigation, we intend FR 30750, 30755 (June 8, 1999); and to hold the hearing two days after the Notice of Preliminary Determination of rebuttal brief deadline date at the U.S. Sales at Less Than Fair Value and Department of Commerce, 14th Street Postponement of Final Determination: and Constitution Avenue, NW, Coated Free Sheet Paper from Washington, DC 20230, at a time and in Indonesia, 72 FR 30753, 30757 (June 4, a room to be determined. Parties should 2007); (unchanged in final confirm by telephone, the date, time, determination, 72 FR 60636) (October and location of the hearing 48 hours 25, 2007). before the scheduled date. Interested parties who wish to request Disclosure a hearing, or to participate in a hearing We will disclose the calculations if one is requested, must submit a performed in our preliminary analysis written request to the Assistant to parties to this proceeding in Secretary for Import Administration, accordance with 19 CFR 351.224(b). U.S. Department of Commerce, Room 1870, within 30 days of the publication ITC Notification of this notice. Requests should contain: In accordance with section 733(f) of (1) the party’s name, address, and the Act, we have notified the ITC of the telephone number; (2) the number of Department’s preliminary affirmative participants; and (3) a list of the issues determination. If the Department’s final to be discussed. At the hearing, oral determination is affirmative, the ITC presentations will be limited to issues will determine before the later of 120 raised in the briefs. days after the date of this preliminary Postponement of Final Determination determination or 45 days after our final determination whether imports of citric and Extension of Provisional Measures acid from Canada are materially Section 735(a)(2) of the Act provides injuring, or threatening material injury that a final determination may be to, the U.S. industry (see section postponed until not later than 135 days 735(b)(2) of the Act). Because we are after the date of the publication of the postponing the deadline for our final preliminary determination if, in the determination to 135 days from the date event of an affirmative preliminary of the publication of this preliminary determination, a request for such determination (see below), the ITC will postponement is made by exporters, make its final determination no later who account for a significant proportion than 45 days after our final of exports of the subject merchandise, or determination. in the event of a negative preliminary Manufacturer/Exporter rwilkins on PROD1PC63 with NOTICES Weighted– Average Margin (percent) VerDate Aug<31>2005 18:26 Nov 19, 2008 Jkt 217001 PO 00000 Frm 00020 Fmt 4703 Sfmt 4703 determination, a request for such postponement is made by the petitioner. The Department’s regulations, at 19 CFR 351.210(e)(2), require that requests by respondents for postponement of a final determination be accompanied by a request for extension of provisional measures from a four–month period to not more than six months. On October 22, 2008, JBLT requested that in the event of an affirmative preliminary determination in this investigation, the Department postpone its final determination by 60 days. At the same time, JBLT requested that the Department extend the application of the provisional measures prescribed under section 733(d) of the Act and 19 CFR 351.210(e)(2), from a four–month period to a six–month period. In accordance with section 735(a)(2) of the Act and 19 CFR 351.210(b)(2), because (1) our preliminary determination is affirmative, (2) the requesting exporter accounts for a significant proportion of exports of the subject merchandise, and (3) no compelling reasons for denial exist, we are granting this request and are postponing the final determination until no later than 135 days after the publication of this notice in the Federal Register. Suspension of liquidation will be extended accordingly. This determination is issued and published pursuant to sections 733(f) and 777(i)(1) of the Act. Dated: November 12, 2008. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E8–27621 Filed 11–19–08; 8:45 am] BILLING CODE 3510–DS–S DEPARTMENT OF COMMERCE International Trade Administration [A–570–937] Citric Acid and Certain Citrate Salts from the People’s Republic of China: Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination Import Administration, International Trade Administration, Department of Commerce. EFFECTIVE DATE: November 20, 2008. SUMMARY: We preliminarily determine that citric acid and certain citrate salts (‘‘citric acid’’) 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 AGENCY: E:\FR\FM\20NON1.SGM 20NON1

Agencies

[Federal Register Volume 73, Number 225 (Thursday, November 20, 2008)]
[Notices]
[Pages 70324-70328]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-27621]


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

DEPARTMENT OF COMMERCE

International Trade Administration

[A-122-853]


Citric Acid and Certain Citrate Salts from Canada: Notice of 
Preliminary Determination of Sales at Less Than Fair Value and 
Postponement of Final Determination

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY:  The U.S. Department of Commerce (the Department) 
preliminarily determines that citric acid and certain citrate salts 
(citric acid) from Canada are being, or are likely to be, sold in the 
United States at less than fair value (LTFV), as provided in section 
733(b) of the Tariff Act of 1930, as amended (the Act). The estimated 
margins of sales at LTFV are listed in the ``Suspension of 
Liquidation'' section of this notice. Interested parties are invited to 
comment on this preliminary determination. Pursuant to a request from 
the respondent, we are postponing for 60 days the final determination 
and extending 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.

EFFECTIVE DATE: November 20, 2008.

FOR FURTHER INFORMATION CONTACT: Terre Keaton Stefanova or Rebecca 
Trainor, AD/CVD Operations, Office 2, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW, Washington, DC 20230; telephone 
(202) 482-1280 and (202) 482-4007, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On May 5, 2008, the Department initiated the antidumping duty 
investigation of citric acid from Canada. See Citric Acid and Certain 
Citrate Salts from Canada and the People's Republic of China: 
Initiation of Antidumping Duty Investigations, 73 FR 27492 (May 13, 
2008) (Initiation Notice). The petitioners in this investigation are 
Archer Daniels Midland Company, Cargill, Incorporated, and Tate & Lyle 
Americas, Inc.
    The Department set aside a period of time for parties to raise 
issues regarding product coverage and encouraged all parties to submit 
comments within 20 calendar days of publication of the Initiation 
Notice. See Initiation Notice, 73 FR at 27493. See also Antidumping 
Duties; Countervailing Duties, 62 FR 27296, 27323 (May 19, 1997). For 
further details, see the ``Scope Comments'' section of this notice, 
below. The Department also set aside a time for parties to comment on 
product characteristics for use in the antidumping duty questionnaire. 
On May 27, 2008, we received product characteristic comments from the 
petitioners. In June 2008, we received comments from Shandong TTCA Co., 
Ltd (TTCA), and Jungbunzlauer Technology GMBH & Co KG, (JBLT) regarding 
the petitioners' product characteristic comments. Also in June 2008, 
the petitioners filed comments in response to TTCA's submission. For an 
explanation of the product-comparison criteria used in this 
investigation, see the ``Product Comparisons'' section of this notice, 
below.
    On June 11, 2008, the International Trade Commission (ITC) 
published its affirmative preliminary determination that there is a 
reasonable indication that imports of citric acid and certain citrate 
salts from Canada are materially injuring the U.S. industry, and the 
ITC notified the Department of its finding. See Citric Acid and Certain 
Citrate Salts from Canada and China; Determinations, Investigation Nos. 
701-TA-456 and 731-TA-1151-1152, 73 FR 33115 (June 11, 2008).
    On June 17, 2008, we selected JBLT as the sole mandatory respondent 
in this investigation. See Memorandum from James Maeder, Office 
Director, to Stephen J. Claeys, Deputy Assistant Secretary, entitled: 
``Antidumping Duty Investigation of Citric Acid and Certain Citrate 
Salts from Canada - Selection of Respondents for Individual Review,'' 
dated June 17, 2008. We subsequently issued the antidumping 
questionnaire to JBLT on June 26, 2008. On August 19, 2008, the 
petitioners made a timely request pursuant to section 733(c)(1)(A) of 
the Act and 19 CFR 351.205(e) for a 50-day postponement of the 
preliminary determination. On August 29, 2008, pursuant to section 
733(c)(1)(A) of the Act, the Department postponed the preliminary 
determination of this investigation until November 12, 2008. See Citric 
Acid and Certain Citrate Salts from Canada and the People's Republic of 
China: Postponement of Preliminary Determinations of Antidumping Duty 
Investigations, 73 FR 50941 (August 29, 2008).
    In August and September 2008, we received JBLT's questionnaire 
responses. In September and October 2008, we issued supplemental 
questionnaires, and we received JBLT's responses to these 
questionnaires in October and November 2008. We note that JBLT's 
questionnaire response that was due on November 7, 2008, was not 
received in time for consideration in the preliminary determination, 
but will be considered in the final determination.
    On October 22, 2008, JBLT requested that in the event of an 
affirmative preliminary determination in this investigation, the 
Department: 1) postpone its final determination by 60 days in 
accordance with 735(a)(2)(A) of the Act and 19 CFR 351.210(b)(2)(ii); 
and 2) extend the application of the provisional measures prescribed 
under 19 CFR 351.210(e)(2) from a four-month period to a six-month 
period. On October 24, 2008, the petitioner requested that in the event 
of a negative preliminary determination in this investigation, the 
Department postpone the final determination by 60 days. For further 
discussion, see the ``Postponement of Final Determination and Extension 
of Provisional Measures'' section of this notice, below.
    On October 28, 2008, the petitioners submitted comments for 
consideration in the preliminary determination.

Period of Investigation

    The period of investigation (POI) is April 1, 2007, to March 31, 
2008. This period corresponds to the four most recent fiscal quarters 
prior to the month of the filing of the petition. See 19 CFR 
351.204(b)(1).

Scope of Investigation

    The scope of this investigation includes all grades and granulation 
sizes of citric acid, sodium citrate, and potassium citrate in their 
unblended forms, whether dry or in solution, and regardless of 
packaging type. The scope also includes blends of citric acid, sodium 
citrate, and potassium citrate; as well as blends with other 
ingredients, such as sugar, where the unblended form(s) of citric acid, 
sodium citrate, and potassium citrate constitute 40 percent or more, by 
weight, of the blend. The scope of this investigation also includes all 
forms of crude calcium citrate, including dicalcium citrate

[[Page 70325]]

monohydrate, and tricalcium citrate tetrahydrate, which are 
intermediate products in the production of citric acid, sodium citrate, 
and potassium citrate. The scope of this investigation does not include 
calcium citrate that satisfies the standards set forth in the United 
States Pharmacopeia and has been mixed with a functional excipient, 
such as dextrose or starch, where the excipient constitutes at least 2 
percent, by weight, of the product. The scope of this investigation 
includes the hydrous and anhydrous forms of citric acid, the dihydrate 
and anhydrous forms of sodium citrate, otherwise known as citric acid 
sodium salt, and the monohydrate and monopotassium forms of potassium 
citrate. Sodium citrate also includes both trisodium citrate and 
monosodium citrate, which are also known as citric acid trisodium salt 
and citric acid monosodium salt, respectively. Citric acid and sodium 
citrate are classifiable under 2918.14.0000 and 2918.15.1000 of the 
Harmonized Tariff Schedule of the United States (HTSUS), respectively. 
Potassium citrate and crude calcium citrate are classifiable under 
2918.15.5000 and 3824.90.9290 of the HTSUS, respectively. Blends that 
include citric acid, sodium citrate, and potassium citrate are 
classifiable under 3824.90.9290 of the HTSUS. Although the HTSUS 
subheadings are provided for convenience and customs purposes, the 
written description of the merchandise is dispositive.

Scope Comments

    In accordance with the preamble to the Department's regulations 
(see Antidumping Duties; Countervailing Duties, 62 FR 27296, 27323 (May 
19, 1997)), in our Initiation Notice we set aside a period of time for 
parties to raise issues regarding product coverage, and encouraged all 
parties to submit comments within 20 calendar days of publication of 
the Initiation Notice. On May 23, 2008, and June 3, 2008, respectively, 
Chemrom Inc. and L. Perrigo Company timely filed comments concerning 
the scope of this investigation and the concurrent antidumping duty and 
countervailing duty investigation of citric acid and certain citrate 
salts from the People's Republic of China. The petitioners responded to 
these comments on June 16, 2008.
    On August 6, 2008, the Department issued a memorandum to the file 
regarding the petitioners' proposed amendments to the scope of the 
investigations. In response, on August 11, 2008, L. Perrigo Company and 
the petitioners submitted comments to provide clarification of the term 
``unrefined'' calcium citrate. We analyzed the comments of the 
interested parties regarding the scope of this investigation. See 
September 10, 2008, Memorandum to Stephen J. Claeys, Deputy Assistant 
Secretary for Import Administration, re: Antidumping Duty 
Investigations of Citric Acid and Certain Citrate Salts from Canada and 
the People's Republic of China (PRC), and Countervailing Duty 
Investigation of Citric Acid and Certain Citrates Salts from the PRC, 
``Whether to Amend the Scope of these Investigations to Exclude 
Monosodium Citrate and to Further Define the Product Referred to as 
Unrefined Calcium Citrate''' (Scope Memo). Our position on these 
comments, as set out in the Scope Memo, are incorporated in the ``Scope 
of the Investigation'' section above.

Product Comparisons

    We have taken into account the comments that were submitted by the 
interested parties concerning product-comparison criteria. In 
accordance with section 771(16) of the Act, all products produced by 
the respondent covered by the description in the ``Scope of 
Investigation'' section, above, and sold in Canada during the POI are 
considered to be foreign like product for purposes of determining 
appropriate product comparisons to U.S. sales. We have relied on four 
criteria to match U.S. sales of subject merchandise to comparison-
market sales of the foreign like product: 1) type, 2) form, 3) grade, 
and 4) particle size. Where there were no sales of identical 
merchandise in the home market made in the ordinary course of trade to 
compare to U.S. sales, we compared U.S. sales to the next most similar 
foreign like product on the basis of the characteristics listed above.

Date of Sale

    The Department normally will use the date of invoice, as recorded 
in the producer's or exporter's records kept in the ordinary course of 
business, as the date of sale. However, the Department's regulations 
provide that the Department may use a date other than the date of 
invoice if the Secretary is satisfied that a different date better 
reflects the date on which the exporter or producer establishes the 
material terms of sale (e.g., price and quantity). See 19 CFR 
351.401(i); see also Allied Tube and Conduit Corp. v. United States, 
132 F. Supp. 2d 1087, 1090-92 (CIT 2001). In this case, JBLT indicated 
in its questionnaire responses that it made certain sales subject to 
long-term contracts in both the United States and Canada during the 
POI. For the sales covered by these agreements, JBLT reported the 
contract date as the date of sale in its home market and U.S. sales 
listings, claiming that the material terms of sale were fixed at the 
time these contracts were signed. For all other sales that were not 
covered by these agreements, JBLT reported the date of invoice as the 
date of sale. In its responses to the Department's questionnaires, JBLT 
provided sample documentation of the types of long-term contracts that 
were in effect during the POI, and a detailed explanation of the nature 
of these agreements. JBLT stated that: 1) in some instances the invoice 
price differed from the price established in the contract, usually as a 
result of extra services being provided to the customer that were not 
covered by the contract\1\; 2) customers might change delivery 
destinations, packaging, granulation, or lead times after a contract 
was signed, which would result in a change to the price; and 3) the 
contracts were not ``take or pay'' contracts; therefore, the actual 
volumes sold for the contracted period might be more or less than the 
contracted volumes. See JBLT's October 15, 2008, Supplemental 
Questionnaire Response at 6-9.
---------------------------------------------------------------------------

    \1\ Such changes to price between date of contract and date of 
invoice are evident in JBLT's revised home market and U.S. sales 
databases submitted on October 14, 2008.
---------------------------------------------------------------------------

    As the information on the record indicates that the material terms 
of sale (e.g., price and quantity) are subject to change after the date 
the sales contracts are signed, we preliminary determine that the 
invoice date better reflects the date on which the producer/exporter 
established the material terms of sale. Therefore, for purposes of the 
preliminary determination, we used the invoice date as the date of sale 
for all home market and U.S. sales, in accordance with our normal 
practice.

Fair Value Comparisons

    To determine whether sales of citric acid from Canada to the United 
States were made at LTFV, we compared the constructed export price 
(CEP)\2\ to normal value (NV), as described in the ``Constructed Export 
Price'' and ``Normal Value'' sections of this notice. In accordance 
with section 777A(d)(1) of the Act, we compared POI weighted-average 
CEPs to POI weighted-average NVs.
---------------------------------------------------------------------------

    \2\ All of JBLT's sales in the U.S. market during the POI were 
CEP sales.
---------------------------------------------------------------------------

Constructed Export Price

    In accordance with section 772(b) of the Act, we calculated CEP for 
those sales where the subject merchandise

[[Page 70326]]

was first sold (or agreed to be sold) in the United States before or 
after the date of importation by or for the account of the producer or 
exporter of such merchandise, or by a seller affiliated with the 
producer or exporter, to a purchaser not affiliated with the producer 
or exporter.
    We based CEP on packed, ex-factory or delivered prices to 
unaffiliated purchasers in the United States. When appropriate, we 
adjusted the starting prices for billing adjustments, rebates and 
interest revenue, in accordance with 19 CFR 351.401(c). We made 
deductions for movement expenses, where appropriate, in accordance with 
section 772(c)(2)(A) of the Act; these expenses included foreign inland 
freight from the plant to the port of exportation, foreign inland 
insurance, foreign brokerage and handling, U.S. brokerage and handling, 
U.S. inland freight from port to warehouse, U.S. warehousing, U.S. 
inland freight from warehouse to the unaffiliated customer, and U.S. 
inland insurance. In accordance with section 772(d)(1) of the Act and 
19 CFR 351.402(b), we deducted those selling expenses associated with 
economic activities occurring in the United States, including direct 
selling expenses (i.e., credit expenses), and indirect selling expenses 
(including inventory carrying costs). We also deducted from CEP an 
amount for profit in accordance with sections 772(d)(3) and (f) of the 
Act.
    For discussion of adjustments made to JBLT's reported U.S. sales 
data, see Memorandum to The File entitled: ``Preliminary Determination 
Margin Calculation for Jungbunzlauer Technology GMBH & Co KG (JBLT),'' 
dated November 12, 2008.

Normal Value

A. Home Market Viability and Comparison-Market Selection

    To determine whether there is a sufficient volume of sales in the 
home market to serve as a viable basis for calculating NV (i.e., the 
aggregate volume of home market sales of the foreign like product is 
equal to or greater than five percent of the aggregate volume of U.S. 
sales), we compared JBLT's volume of home market sales of the foreign 
like product to its volume of U.S. sales of the subject merchandise. 
See section 773(a)(1)(C) of the Act. Based on this comparison, we 
determined that JBLT had a viable home market during the POI. 
Consequently, we based NV on home market sales.

B. Level of Trade

    In accordance with section 773(a)(1)(B) of the Act, to the extent 
practicable, we determine NV based on sales in the comparison market at 
the same level of trade (LOT) as the export price (EP) or CEP. Pursuant 
to 19 CFR 351.412(c)(1), the NV LOT is based on the starting price of 
the sales in the comparison market or, when NV is based on constructed 
value, the starting price of the sales from which we derive selling, 
general and administrative expenses, and profit. For EP sales, the U.S. 
LOT is based on the starting price of the sales in the U.S. market, 
which is usually from exporter to importer. For CEP sales, the U.S. LOT 
is based on the starting price of the U.S. sales, as adjusted under 
section 772(d) of the Act, which is from the exporter to the importer.
    To determine whether NV sales are at a different LOT than EP or CEP 
sales, we examine stages in the marketing process and selling functions 
along the chain of distribution between the producer and the 
unaffiliated customer. See 19 CFR 351.412(c)(2). If the comparison-
market sales are at a different LOT, and the difference affects price 
comparability, as manifested in a pattern of consistent price 
differences between the sales on which NV is based and comparison- 
market sales at the LOT of the export transaction, we make an LOT 
adjustment under section 773(a)(7)(A) of the Act. Finally, for CEP 
sales, if the NV level is more remote from the factory than the CEP 
level and there is no basis for determining whether the difference in 
levels between NV and CEP affects price comparability, we adjust NV 
under section 773(a)(7)(B) of the Act (the CEP-offset provision). See 
Notice of Final Determination of Sales at Less Than Fair Value: Certain 
Cut-to-Length Carbon Steel Plate from South Africa, 62 FR 61731 - 61733 
(Nov. 19, 1997).
    In this investigation, we obtained information from JBLT regarding 
the marketing stages involved in making its reported home market and 
U.S. sales, including a description of the selling activities performed 
by the respondent and its affiliates for each channel of distribution.
    During the POI, JBLT reported that it sold citric acid to end-users 
and distributors through two channels of distribution in both the U.S. 
and home markets. JBLT stated that its selling process was basically 
the same for all channels of distribution. As the details of JBLT's 
reported selling functions for each channel of distribution are 
business proprietary, our analysis of these selling functions for 
purposes of determining whether different LOTs exist is contained in a 
separate memorandum to James Maeder, Director, AD/CVD Operations Office 
2, from the Team entitled ``Preliminary Level-of-Trade Analysis,'' 
dated November 12, 2008.
    Based on our analysis, we find that the selling functions JBLT 
performed for each of its channels of distribution in the U.S. market 
were essentially the same, but for one selling function which we 
determined was not sufficient to warrant an LOT distinction between 
these channels. Therefore, we determined preliminarily that there is 
only one LOT (for CEP sales) in the U.S. market. Similarly, we found 
that the selling functions that JBLT (and its affiliates) performed for 
each of the channels of distribution in the home market were 
essentially the same, with the exception of certain selling activities 
which we determined were not sufficient to warrant a LOT distinction 
between these channels. Therefore, we determined preliminarily that 
there is only one LOT in the home market.
    In comparing the home market LOT to the CEP LOT, we found that the 
selling activities performed by JBLT for its CEP sales were 
significantly fewer than the selling activities that it performed for 
its home market sales, and that the home-market LOT was more remote 
from the factory than the CEP LOT. Accordingly, we considered the CEP 
LOT to be different from the home-market LOT and to be at a less 
advanced stage of distribution than the home-market LOT.
    Therefore, we could not match CEP sales to sales at the same LOT in 
the home market, nor could we determine an LOT adjustment based on 
JBLT's home market sales because there is only one LOT in the home 
market, and it is not possible to determine if there is a pattern of 
consistent price differences between the sales on which NV is based and 
home market sales at the LOT of the export transaction. See section 
773(a)(7)(A) of the Act. Furthermore, we have no other information that 
provides an appropriate basis for determining an LOT adjustment. 
Consequently, because the data available do not form an appropriate 
basis for making an LOT adjustment but the home market LOT is at a more 
advanced stage of distribution than the CEP LOT, we made a CEP offset 
to NV in accordance with section 773(a)(7)(B) of the Act. The CEP 
offset is calculated as the lesser of: (1) the indirect selling 
expenses incurred on the home market sales, or (2) the indirect selling 
expenses deducted from the starting price in calculating CEP.

C. Cost of Production Analysis

    Based on our analysis of the petitioners' sales below cost of 
production (COP) allegation filed in the

[[Page 70327]]

petition,\3\ we found reasonable grounds to believe or suspect that 
citric acid sales were made in Canada at prices below the COP, and 
initiated a country-wide cost investigation. See section 
773(b)(2)(A)(i) of the Act and Initiation Notice at 27494. Accordingly, 
pursuant to section 773(b) of the Act, we conducted a sales-below-cost 
investigation to determine whether JBLT's sales were made at prices 
below their respective COPs.
---------------------------------------------------------------------------

    \3\ See the Petition on Citric Acid and Certain Citrate Salts 
from Canada, Vol. II at 4-9, filed on April 14, 2008.
---------------------------------------------------------------------------

1. Calculation of Cost of Production
    In accordance with section 773(b)(3) of the Act, we calculated COP 
based on the sum of the cost of materials and fabrication for the 
foreign like product, plus an amount for general and administrative 
expenses (G&A), interest expenses, and home market packing costs (see 
``Test of Home Market Sales Prices'' section below for treatment of 
home market selling expenses and packing costs). We relied on the COP 
data submitted by JBLT in its October 27, 2008, supplemental response 
to section D of the questionnaire, except where noted below.
    We adjusted the total cost of manufacturing for a major input used 
in the production of citric acid purchased from an affiliated company 
to reflect the higher of transfer price, market price, or cost in 
accordance with section 773(f)(3) of the Act. We recalculated the G&A 
expense ratio to include capital tax and consulting services. We 
applied the revised G&A expense ratio and the financial expense ratio 
to the total cost of manufacturing before our major input adjustment. 
For further discussion, see Memorandum from James Balog to Neal Halper, 
Director, Office of Accounting, Cost of Production and Constructed 
Value Calculation Adjustments for the Preliminary Determination - 
Jungbunzlauer Technology GMBH & Co KG dated November 12, 2008.
2. Test of Comparison-Market Sales Prices
    On a product-specific basis, we compared the adjusted weighted-
average COP to the home market sales of the foreign like product, as 
required under section 773(b) of the Act, to determine whether the sale 
prices were below the COP. For purposes of this comparison, we used the 
COP exclusive of selling and packing expenses. The prices were adjusted 
for billing adjustments and interest revenue, and were exclusive of any 
applicable movement charges, direct and indirect selling expenses, and 
packing expenses.
3. Results of the COP Test
    Pursuant to section 773(b)(2)(C)(i) of the Act, where less than 20 
percent of the respondent's sales of a given product were at prices 
less than the COP, we do not disregard any below-cost sales of that 
product because we determined that the below-cost sales were not made 
in ``substantial quantities.'' Where 20 percent or more of the 
respondent's sales of a given product during the POI were at prices 
less than COP, we determine that such sales have been made in 
``substantial quantities.'' See section 773(b)(2)(C) of the Act. 
Further, we determine that the sales were made within an extended 
period of time, in accordance with section 773(b)(2)(B) of the Act, 
because we examine below-cost sales occurring during the entire POI. In 
such cases, because we compare prices to POI-average costs, we also 
determine that such sales were not made at prices which would permit 
recovery of all costs within a reasonable period of time, in accordance 
with section 773(b)(2)(D) of the Act.
    In this case, we found that, for certain specific products, more 
than 20 percent of JBLT's sales were at prices less than the COP and, 
in addition, such sales did not provide for the recovery of costs 
within a reasonable period of time. We therefore excluded these sales 
and used the remaining sales as the basis for determining NV, in 
accordance with section 773(b)(1) of the Act.

D. Calculation of Normal Value Based on Comparison-Market Prices

    We based NV for JBLT on packed, ex-factory or delivered prices to 
unaffiliated customers in the home market. We made adjustments to the 
starting price, where appropriate, for billing adjustments and interest 
revenue in accordance with 19 CFR 351.401(c). We made deductions, where 
appropriate, for movement expenses, including inland freight and inland 
insurance, under section 773(a)(6)(B)(ii) of the Act.
    Pursuant to section 773(a)(6)(C)(iii) of the Act and 19 CFR 
351.410(b), we made, where appropriate, circumstance-of-sale 
adjustments for imputed credit expenses. We also deducted home market 
packing costs and added U.S. packing costs, in accordance with sections 
773(a)(6)(A) and (B) of the Act. Finally, we made a CEP offset pursuant 
to section 773(a)(7)(B) of the Act and 19 CFR 351.412(f). We calculated 
the CEP offset as the lesser of the indirect selling expenses on the 
home-market sales or the indirect selling expenses deducted from the 
starting price in calculating CEP.

Currency Conversion

    It is our normal practice to make currency conversions into U.S. 
dollars in accordance with section 773A(a) of the Act based on exchange 
rates in effect on the dates of the U.S. sales, as certified by the 
Federal Reserve Bank.
    In the antidumping questionnaire, we instructed JBLT to report 
prices and expenses in the currency in which they were incurred. 
Nevertheless, in this case, JBLT reported data that had been converted 
from multiple currencies into Canadian dollars (CAD) in the home 
market, and U.S. dollars (USD) in the U.S. market because its company-
wide electronic data processing system automatically converts all 
foreign currency transactions into the currency of the respective JBL 
Group entity at the moment of posting. According to JBLT, the entry of 
data and the currency conversion is a simultaneous process in its 
accounting system. As a result, its system does not retain the original 
foreign currency amount in the sales database or in the general ledger. 
See JBLT's October 15, 2008, supplemental questionnaire response at 
pages 4-6.
    Because it appears that the currency conversion process is a 
company-wide procedure that is done in the normal course of business, 
we have accepted JBLT's data as reported for the preliminary 
determination. However, at verification we intend to examine JBLT's 
accounting system, and the reasonableness of its price and expense 
reporting based on this system.

Verification

    As provided in section 782(i)(1) of the Act, we intend to verify 
the information relied upon in making our final determination for JBLT.

Suspension of Liquidation

    In accordance with section 733(d)(2) of the Act, we will direct 
Customs and Border Protection (CBP) to suspend liquidation of all 
entries of citric acid from Canada that are entered, or withdrawn from 
warehouse, for consumption on or after the date of publication of this 
notice in the Federal Register. We will also instruct CBP to require a 
cash deposit or the posting of a bond equal to the weighted-average 
dumping margins, as indicated in the chart below. These suspension-of-
liquidation instructions will remain in effect until further notice.
    The weighted-average dumping margins are as follows:

[[Page 70328]]



------------------------------------------------------------------------
                                                            Weighted-
                 Manufacturer/Exporter                    Average Margin
                                                            (percent)
------------------------------------------------------------------------
Jungbunzlauer Technology GMBH & Co KG..................          20.88
All-Others.............................................          20.88
------------------------------------------------------------------------

All-Others Rate

    Section 735(c)(5)(A) of the Act provides that the estimated ``All 
Others'' rate shall be an amount equal to the weighted average of the 
estimated weighted-average dumping margins established for exporters 
and producers individually investigated, excluding any zero or de 
minimis margins, and any margins determined entirely under section 776 
of the Act. JBLT is the only respondent in this investigation for which 
the Department calculated a company-specific rate. Therefore, for 
purposes of determining the all-others rate and pursuant to section 
735(c)(5)(A) of the Act, we are using the weighted-average dumping 
margin calculated for JBLT, as referenced above. See, e.g., Notice of 
Final Determination of Sales at Less Than Fair Value: Stainless Steel 
Sheet and Strip in Coils From Italy, 64 FR 30750, 30755 (June 8, 1999); 
and Notice of Preliminary Determination of Sales at Less Than Fair 
Value and Postponement of Final Determination: Coated Free Sheet Paper 
from Indonesia, 72 FR 30753, 30757 (June 4, 2007); (unchanged in final 
determination, 72 FR 60636) (October 25, 2007).

Disclosure

    We will disclose the calculations performed in our preliminary 
analysis to parties to this proceeding in accordance with 19 CFR 
351.224(b).

ITC Notification

    In accordance with section 733(f) of the Act, we have notified the 
ITC of the Department's preliminary affirmative determination. If the 
Department's final determination is affirmative, the ITC will determine 
before the later of 120 days after the date of this preliminary 
determination or 45 days after our final determination whether imports 
of citric acid from Canada are materially injuring, or threatening 
material injury to, the U.S. industry (see section 735(b)(2) of the 
Act). Because we are postponing the deadline for our final 
determination to 135 days from the date of the publication of this 
preliminary determination (see below), the ITC will make its final 
determination no later than 45 days after our final determination.

Public Comment

    Interested parties are invited to comment on the preliminary 
determination. Interested parties may submit case briefs to the 
Department no later than seven days after the date of the issuance of 
the last verification report in this proceeding. Rebuttal briefs, the 
content of which is limited to the issues raised in the case briefs, 
must be filed within five days from the deadline date for the 
submission of case briefs. A list of authorities used, a table of 
contents, and an executive summary of issues should accompany any 
briefs submitted to the Department. Executive summaries should be 
limited to five pages total, including footnotes. Further, we request 
that parties submitting briefs and rebuttal briefs provide the 
Department with a copy of the public version of such briefs on 
diskette. In accordance with section 774 of the Act, the Department 
will hold a public hearing, if timely requested, to afford interested 
parties an opportunity to comment on arguments raised in case or 
rebuttal briefs, provided that such a hearing is requested by an 
interested party. If a timely request for a hearing is made in this 
investigation, we intend to hold the hearing two days after the 
rebuttal brief deadline date at the U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW, Washington, DC 20230, at a time and 
in a room to be determined. Parties should confirm by telephone, the 
date, time, and location of the hearing 48 hours before the scheduled 
date.
    Interested parties who wish to request a hearing, or to participate 
in a hearing 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 of the publication of this notice. 
Requests should contain: (1) the party's name, address, and telephone 
number; (2) the number of participants; and (3) a list of the issues to 
be discussed. At the hearing, oral presentations will be limited to 
issues raised in the briefs.

Postponement of Final Determination and Extension of Provisional 
Measures

    Section 735(a)(2) of the Act provides that a final determination 
may be postponed until not later than 135 days after the date of the 
publication of the preliminary determination if, in the event of an 
affirmative preliminary determination, a request for such postponement 
is made by exporters, who account for a significant proportion of 
exports of the subject merchandise, or in the event of a negative 
preliminary determination, a request for such postponement is made by 
the petitioner. The Department's regulations, at 19 CFR 351.210(e)(2), 
require that requests by respondents for postponement of a final 
determination be accompanied by a request for extension of provisional 
measures from a four-month period to not more than six months.
    On October 22, 2008, JBLT requested that in the event of an 
affirmative preliminary determination in this investigation, the 
Department postpone its final determination by 60 days. At the same 
time, JBLT requested that the Department extend the application of the 
provisional measures prescribed under section 733(d) of the Act and 19 
CFR 351.210(e)(2), from a four-month period to a six-month period. In 
accordance with section 735(a)(2) of the Act and 19 CFR 351.210(b)(2), 
because (1) our preliminary determination is affirmative, (2) the 
requesting exporter accounts for a significant proportion of exports of 
the subject merchandise, and (3) no compelling reasons for denial 
exist, we are granting this request and are postponing the final 
determination until no later than 135 days after the publication of 
this notice in the Federal Register. Suspension of liquidation will be 
extended accordingly.
    This determination is issued and published pursuant to sections 
733(f) and 777(i)(1) of the Act.

    Dated: November 12, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E8-27621 Filed 11-19-08; 8:45 am]
BILLING CODE 3510-DS-S