Refined Brown Aluminum Oxide from the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review, 72767-72770 [E8-28458]

Download as PDF Federal Register / Vol. 73, No. 231 / Monday, December 1, 2008 / Notices will issue instructions directly to U.S. Customs and Border Protection (CBP) to terminate the suspension of liquidation of subject merchandise and release all bonds and any cash deposits that have been posted, where applicable. Notification Regarding Administrative Protective Orders This notice serves as a reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation. This determination and notice are published in accordance with section 734(a) of the Act and 19 CFR 351.207(b). Dated: November 21, 2008. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E8–28469 Filed 11–28–08; 8:45 am] BILLING CODE 3510–DS–S DEPARTMENT OF COMMERCE International Trade Administration A–570–882 Refined Brown Aluminum Oxide from the People’s Republic of China: Preliminary Results of Antidumping Duty Administrative Review Import Administration, International Trade Administration, Department of Commerce. SUMMARY: In response to a request from an interested party, the Department of Commerce (the Department) is conducting the 2006–2007 administrative review of the antidumping duty order on refined brown aluminum oxide (RBAO) from the People’s Republic of China (PRC). The review covers one exporter, Qingdao Shunxingli Abrasives Co. Ltd. (Qingdao Shunxingli). The period of review (POR) is November 1, 2006, to October 31, 2007. We have preliminarily determined that sales have been made at prices below normal value by Qingdao Shunxingli. If these preliminary results are adopted in our final results of administrative review, we will instruct U.S. Customs and Border Protection (CBP) to assess antidumping duties on all appropriate entries. rwilkins on PROD1PC63 with NOTICES AGENCY: VerDate Aug<31>2005 16:47 Nov 28, 2008 Jkt 217001 We invite interested parties to comment on these preliminary results. Parties who submit comments in this review are requested to submit with each argument (1) a statement of the issue and (2) a brief summary of the argument. EFFECTIVE DATE: December 1, 2008. FOR FURTHER INFORMATION CONTACT: David Goldberger or Kate Johnson, AD/ CVD Operations, Office 2, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 20230; telephone (202) 482–4136 or (202) 482– 4929, respectively. SUPPLEMENTARY INFORMATION: Background On November 1, 2007, the Department published a notice of opportunity to request an administrative review of the antidumping duty order on, inter alia, RBAO from the PRC. See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 72 FR 61859 (November 1, 2007). In response, Fujimi Corporation (Fujimi), an importer of the subject merchandise, timely requested an administrative review of the antidumping duty order on RBAO from the PRC for entries of the subject merchandise during the POR from two PRC producers/exporters: Henan Yilong High and New Materials Co., Ltd. (Henan Yilong), and Qingdao Shunxingli. On December 27, 2007, the Department initiated a review on Henan Yilong and Qingdao Shunxingli. See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 72 FR 73315 (December 27, 2007). The Department issued antidumping duty questionnaires to Henan Yilong and Qingdao Shunxingli on January 7, 2008. We received responses to these questionnaires in March 2008. We issued a supplemental questionnaire to Henan Yilong in April 2008 and received a response later that month. We issued supplemental questionnaires to Qingdao Shunxingli in March, May, and July 2008. We received responses to these supplemental questionnaires in April, May, and July 2008, respectively. On May 23, 2008, Fujimi withdrew its request for review of Henan Yilong and requested that the Department rescind the review with respect to this company. In accordance with 19 CFR 351.213(d)(1), we granted Fujimi’s request and rescinded this administrative review with respect to PO 00000 Frm 00007 Fmt 4703 Sfmt 4703 72767 Henan Yilong. In addition, we extended the due date for completion of these preliminary results until not later than December 1, 2008. See Refined Brown Aluminum Oxide from the People’s Republic of China: Notice of Partial Rescission of Antidumping Duty Administrative Review and Extension of Time Limit for Preliminary Results, 73 FR 38173 (July 3, 2008). Scope of the Order The merchandise covered by this order is ground, pulverized or refined artificial corundum, also known as brown aluminum oxide or brown fused alumina, in grit size of 3/8 inch or less. Excluded from the scope of the order is crude artificial corundum in which particles with a diameter greater than 3/ 8 inch constitute at least 50 percent of the total weight of the entire batch. The scope includes brown artificial corundum in which particles with a diameter greater than 3/8 inch constitute less than 50 percent of the total weight of the batch. The merchandise under investigation is currently classifiable under subheadings 2818.10.20.00 and 2818.10.20.90 of the Harmonized Tariff Schedule of the United States (HTSUS). Although the HTSUS subheading is provided for convenience and customs purposes, the written description of the merchandise covered by the order is dispositive. NME Country Status In every case conducted by the Department involving the PRC, the PRC has been treated as a non–market– economy (NME) country. In accordance with section 771(18)(C)(i) of the Tariff Act of 1930, as amended (the Act), any determination that a foreign country is an NME country shall remain in effect until revoked by the administering authority. See Brake Rotors From the People’s Republic of China: Preliminary Results and Partial Rescission of the 2004/2005 Administrative Review and Notice of of Intent to Rescind the 2004/ 2005 New Shipper Review, 71 FR 26736, (May 8, 2006); unchanged in Brake Rotors From the People’s Republic of China: Final Results and Partial Rescission of the 2004/2005 Administrative Review and Notice of Rescission of 2004/2005 New Shipper Review, 71 FR 66304 (November 14, 2006). None of the parties to this proceeding has contested such treatment. Accordingly, we have calculated normal value in accordance with section 773(c) of the Act, which applies to NME countries. E:\FR\FM\01DEN1.SGM 01DEN1 72768 Federal Register / Vol. 73, No. 231 / Monday, December 1, 2008 / Notices rwilkins on PROD1PC63 with NOTICES Separate Rates Absence of De Jure Control As explained above, a designation of a country as an NME remains in effect until it is revoked by the Department. See section 771(18)(C) of the Act. Accordingly, there is a rebuttable presumption that all companies within the PRC are subject to government control and, thus, should be assessed a single antidumping duty rate. It is the Department’s standard policy to assign all exporters of the merchandise subject to review in NME countries a single rate unless an exporter can affirmatively demonstrate an absence of government control, both in law (de jure) and in fact (de facto), with respect to exports. See Policy Bulletin 05.1 entitled ‘‘Separate Rate Practice and Application of Combination Rates in Antidumping Duty Investigations Involving Non– Market Economy Countries,’’ dated April 5, 2005. To establish whether a company is sufficiently independent to be entitled to a separate, company– specific rate, the Department analyzes each exporting entity in an NME country under the test established in the Final Determination of Sales at Less Than Fair Value: Sparklers from the People’s Republic of China, 56 FR 20588 (May 6, 1991) (Sparklers), as amplified by the 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). The Department’s separate–rate test determines whether the exporters are independent from government control and does not consider, in general, macroeconomic or border–type controls, e.g., export licenses, quotas, and minimum export prices, particularly if these controls are imposed to prevent dumping. The test focuses, rather, on controls over the investment, pricing, and output decision–making process at the individual firm level. See, e.g., Notice of Final Determination of Sales at Less Than Fair Value: Certain Cut–toLength Carbon Steel Plate From Ukraine, 62 FR 61754, 61757 (November 19, 1997). Qingdao Shunxingli provided complete separate–rate information in its responses to our original and supplemental questionnaires. Qingdao Shunxingli is a wholly Chinese–owned company. Therefore, the Department must analyze whether Qingdao Shunxingli can demonstrate the absence of both de jure and de facto governmental control over export activities. 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 at Comment 1. As discussed below, our analysis shows that the evidence on the record supports a preliminary finding of an absence of de jure government control for Qingdao Shunxingli based on each of these factors. The evidence provided by Qingdao Shunxingli supports a preliminary finding of de jure absence of governmental control based on the following facts: (1) an absence of restrictive stipulations associated with the individual exporter’s 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., ‘‘The Company Law of the People’s Republic of China,’’ submitted as Exhibit A–2 to Qingdao Shunxingli’s March 5, 2008, response to Section A of the Department’s questionnaire (QRA). VerDate Aug<31>2005 16:47 Nov 28, 2008 Jkt 217001 Absence of De Facto Control Typically, the Department considers four factors in evaluating whether a respondent is subject to de facto government control of its export functions: (1) whether the export prices are set by, or subject to, the approval of a government authority; (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 its 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 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 governmental control which would preclude the Department from assigning separate rates. PO 00000 Frm 00008 Fmt 4703 Sfmt 4703 With respect to de facto control, Qingdao Shunxingli reported that: (1) it independently set prices for sales to the United States through negotiations with customers and these prices are not subject to review by any government organization; (2) it did not coordinate with other exporters or producers to set the price or to determine to which market it will sell subject merchandise; (3) the PRC Chamber of Commerce did not coordinate its export activities; (4) its staff has the authority to contractually bind it to sell subject merchandise; (5) its management is selected without any government control or review; (6) there is no restriction on its use of export revenues; (7) its management ultimately determines the disposition of respective profits, and Qingdao Shunxingli has not had a loss on its export sales in the last two years; and (8) none of its managers is a government official. See QRA at pages A–2 – A–11. Furthermore, our analysis of Qingdao Shunxingli’s questionnaire responses reveals no other information indicating government control of its export activities. Therefore, based on the information on the record, we preliminarily determine that there is an absence of de facto government control with respect to Qingdao Shunxingli’s exports. In summary, the evidence placed on the record of this review by Qingdao Shunxingli demonstrates an absence of de jure and de facto government control with respect to its exports of the merchandise under review, in accordance with the criteria identified in Sparklers and Silicon Carbide. Surrogate Country When the Department analyzes imports from an NME country, section 773(c)(1) of the Act directs it to base normal value, in most circumstances, on the NME producer’s factors of production (FOP), valued in a surrogate market–economy country or countries considered to be appropriate by the Department. In accordance with section 773(c)(4) of the Act, in valuing the FOP, the Department shall use, to the extent possible, the prices or costs of FOP in one or more market–economy countries that are at a level of economic development comparable to that of the NME country and that are significant producers of comparable merchandise. On January 14, 2008, the Department’s Office of Policy issued a memorandum identifying India, the Philippines, Colombia and Thailand as being at a level of economic development comparable to the PRC for the POR. See Memorandum entitled ‘‘Administrative Review of the Antidumping Order on E:\FR\FM\01DEN1.SGM 01DEN1 Federal Register / Vol. 73, No. 231 / Monday, December 1, 2008 / Notices Refined Brown Aluminum Oxide from the People’s Republic of China (PRC): Request for a List of Surrogate Countries,’’ dated January 14, 2008. After consideration of the relevant factors for surrogate country selection, the Department determined that India is the appropriate surrogate country for this review. See Memorandum entitled ‘‘Administrative Review of the Antidumping Duty Order on Refined Brown Aluminum Oxide from the People’s Republic of China: Selection of a Surrogate Country,’’ dated February 12, 2008. The sources of the surrogate factor values are discussed under the ‘‘Normal Value’’ section below and in the Memorandum entitled ‘‘Preliminary Results Valuation Memorandum’’ (Valuation Memo), dated contemporaneously with this notice. U.S. Price A. Export Price In accordance with section 772(a) of the Act, we based U.S. price on the export price (EP) for sales to the United States made by Qingdao Shunxingli because the first sale to an unaffiliated party was made before the date of importation and the use of constructed EP was not otherwise warranted. We calculated EP for Qingdao Shunxingli based on the prices to unaffiliated purchasers in the United States. In accordance with section 772(c) of the Act, we deducted from the price to unaffiliated purchasers, where appropriate, foreign inland freight, brokerage and handling, and international freight expenses. As foreign inland freight and brokerage and handling services were provided by NME service providers, we valued these services using surrogate values. See Valuation Memo. For those international freight services that were provided by a market–economy provider and for which Qingdao Shunxingli paid in a market–economy currency, we deducted the actual expenses incurred. For those international freight services that were provided by an NME provider, we valued them using the weighted– average of the international freight expenses charged by market–economy providers, as described in the Valuation Memo. rwilkins on PROD1PC63 with NOTICES Normal Value A. Methodology Section 773(c)(1)(B) of the Act provides that the Department shall determine the normal value using a FOP methodology if the merchandise is exported from a NME country and the VerDate Aug<31>2005 16:47 Nov 28, 2008 Jkt 217001 information does not permit the calculation of normal value using home–market prices, third–country prices, or constructed value under section 773(a) of the Act. The Department bases normal value on the FOP because the presence of government controls on various aspects of NME countries renders price comparisons and the calculation of production costs invalid under the Department’s normal methodologies. See Tapered Roller Bearings and Parts Thereof, Finished or Unfinished, From the People’s Republic of China: Preliminary Results of Antidumping Duty Administrative Review and Notice of Intent to Rescind in Part, 70 FR 39744 (July 11, 2005) (unchanged in Tapered Roller Bearings and Parts Thereof, Finished and Unfinished, from the People’s Republic of China: Final Results of 2003–2004 Administrative Review and Partial Rescission of Review, 71 FR 2517 (January 17, 2006)). The FOP for RBAO include the following elements: (1) quantities of raw materials employed; (2) hours of labor required; (3) amounts of energy and other utilities consumed; (4) representative capital and selling costs; and (5) packing materials. We used the FOP reported by Qingdao Shunxingli for materials, labor, energy, and packing. Where appropriate, we adjusted the surrogate prices by including freight costs to make them delivered prices. B. FOP Valuation In accordance with section 773(c) of the Act, we calculated normal value based on the FOP reported by Qingdao Shunxingli for the POR. To calculate normal value, we multiplied the reported per–unit factor–consumption rates by publicly available surrogate values, in accordance with 19 CFR 351.408(c)(1). In selecting the surrogate values, we considered the quality, specificity, and contemporaneity of the data. Consistent with the Department’s practice, we calculated price–index adjustors to inflate or deflate, as appropriate, surrogate values that are not contemporaneous with the POR using the wholesale price index or equivalent for the subject country. See, e.g., Chlorinated Isocyanurates from the People’s Republic of China: Preliminary Results of Antidumping Duty Administrative Review, 73 FR 24943 (May 6, 2008); unchanged in Chlorinated Isocyanurates from the People’s Republic of China: Final Results of Antidumping Duty Administrative Review, 73 FR 52645 (September 10, 2008). The methodology PO 00000 Frm 00009 Fmt 4703 Sfmt 4703 72769 which we applied in this review is detailed in the Valuation Memo. We were unable to identify an appropriate surrogate value from India for the crude brown aluminum oxide raw material input. Therefore, we used a weighted–average U.S. price, derived from the data reported in the Defense Logistics Agency FY2000 Annual Report. Our selection of this value is further discussed in the Valuation Memo. The sources and data we used to determine the surrogate values for the other FOP, as well as the surrogate financial ratios for factory overhead, selling, general and administrative expenses (SG&A), and profit, are discussed in detail in the Valuation Memo. Preliminary Results of the Review As a result of our review, we preliminarily determine that the following percentage weighted–average dumping margin exists for the period November 1, 2006, through October 31, 2007: Manufacturer/Exporter Qingdao Shunxingli Abrasives Co. Ltd. .... Percent Margin 54.62 Comments We will disclose the calculations used in our analysis to parties in this review within five days of the date of publication of this notice in accordance with 19 CFR 351.224(b). Interested parties may submit publicly available information to value factors no later than 20 days after the date of publication of these preliminary results of review. See 19 CFR 351.301(c)(3)(ii). Any interested party may request a hearing within 30 days of the date of publication of this notice. See 19 CFR 351.310(c). Interested parties who wish to request a hearing or to participate in a hearing if a hearing is requested must submit a written request to the Assistant Secretary for Import Administration within 30 days after the date of publication of this notice. See 19 CFR 351.310(c). Requests should contain the following: (1) the party’s name, address, and telephone number; (2) the number of participants; and (3) a list of issues to be discussed. Issues raised in the hearing will be limited to those raised in the case and rebuttal briefs. See 19 CFR 351.310(c). Case briefs from interested parties may be submitted not later than 30 days after the date of publication of this notice of preliminary results of review. See 19 CFR 351.309(c)(1)(ii). Rebuttal briefs from interested parties, limited to the issues raised in the case briefs, may be E:\FR\FM\01DEN1.SGM 01DEN1 72770 Federal Register / Vol. 73, No. 231 / Monday, December 1, 2008 / Notices submitted not later than five days after the time limit for filing the case briefs. See 19 CFR 351.309(d)(1). If requested, any hearing will be held two days after the scheduled date for submission of rebuttal briefs. See 19 CFR 351.310(d). Parties who submit case briefs or rebuttal briefs in this proceeding are encouraged to submit with each argument a statement of the issue, a summary of the arguments not exceeding five pages, and a table of statutes, regulations, and cases cited. See 19 CFR 351.309(c)(2). The Department will issue the final results of this administrative review, including the results of its analysis of issues raised in any such written briefs or at the hearing, if held, not later than 120 days after the date of publication of this notice. See section 751(a)(3)(A) of the Act. publication, as provided by section 751(a)(2)(C) of the Act: (1) for subject merchandise exported by Qingdao Shunxingli, the cash–deposit rate will be that established in the final results of review; (2) for previously reviewed or investigated companies not listed above that have separate rates, the cash– deposit rate will continue to be the company–specific rate published for the most recent period; (3) for all other PRC exporters of subject merchandise, which have not been found to be entitled to a separate rate, the cash–deposit rate will be PRC–wide rate of 135.18 percent; and (4) for all non–PRC exporters of subject merchandise, the cash–deposit rate will be the rate applicable to the PRC exporter that supplied that exporter. These deposit requirements, when imposed, shall remain in effect until further notice. Assessment Rates The Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries. The Department intends to issue assessment instructions to CBP 15 days after the date of publication of the final results of review. Pursuant to 19 CFR 351.212(b)(1), we will calculate importer–specific ad valorem duty assessment rates based on the ratio of the total amount of the dumping margins calculated for the examined sales to the total entered value of those same sales. We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review if any importer–specific assessment rate calculated in the final results of this review is above de minimis. The final results of this review shall be the basis for the assessment of antidumping duties on entries of merchandise covered by the final results of this review and for future deposits of estimated duties, where applicable. Notification to Importers This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary’s presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties. This administrative review and this notice are in accordance with sections 751(a)(1) and 777(i) of the Act. Cash–Deposit Requirements The following cash deposit requirements will be effective upon publication of the notice of final results of the administrative review for all shipments of RBAO from the PRC entered, or withdrawn from warehouse, for consumption on or after the date of rwilkins on PROD1PC63 with NOTICES DOC Case No. A–351–837 A–533–828 A–580–852 A–201–831 A–549–820 A–588–068 C–533–829 ................... ................... ................... ................... ................... ................... .................. VerDate Aug<31>2005 ITC Case No. Jkt 217001 BILLING CODE 3510–DS–S EFFECTIVE DATE: December 1, 2008. The Department official identified in the Initiation of Review section below at AD/CVD Operations, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street & Constitution Ave., NW, Washington, DC 20230. For information from the Commission contact Mary Messer, Office of Investigations, U.S. International Trade Commission at (202) 205–3193. FOR FURTHER INFORMATION CONTACT: SUPPLEMENTARY INFORMATION: Background The Department’s procedures for the conduct of Sunset Reviews are set forth in its Procedures for Conducting Fiveyear (‘‘Sunset’’) Reviews of Antidumping and Countervailing Duty Orders, 63 FR 13516 (March 20, 1998) and 70 FR 62061 (October 28, 2005). Guidance on methodological or analytical issues relevant to the Department’s conduct of Sunset Reviews is set forth in the Department’s Policy Bulletin 98.3 Policies Regarding the Conduct of Five-year (‘‘Sunset’’) Reviews of Antidumping and Countervailing Duty Orders: Policy Bulletin, 63 FR 18871 (April 16, 1998). DEPARTMENT OF COMMERCE Initiation of Review International Trade Administration In accordance with 19 CFR 351.218(c), we are initiating the Sunset Review of the following antidumping duty orders: Initiation of Five-year (‘‘Sunset’’) Reviews Import Administration, International Trade Administration, Department of Commerce. AGENCY: Country 731–TA–1024 731–TA–1025 731–TA–1026 731–TA–1027 731–TA–1028 AA1921–188 701–TA–432 16:47 Nov 28, 2008 Dated: November 21, 2008. David M. Spooner, Assistant Secretary for Import Administration. [FR Doc. E8–28458 Filed 11–28–08; 8:45 am] SUMMARY: In accordance with section 751(c) of the Tariff Act of 1930, as amended (‘‘the Act’’), the Department of Commerce (‘‘the Department’’) is automatically initiating a five-year review (‘‘Sunset Review’’) of the antidumping duty orders listed below. The International Trade Commission (‘‘the Commission’’) is publishing concurrently with this notice its notice of Institution of Five-year Review which covers the same orders. Brazil India South Korea Mexico Thailand Japan India PO 00000 Frm 00010 Product Prestressed Prestressed Prestressed Prestressed Prestressed Prestressed Prestressed Fmt 4703 Concrete Concrete Concrete Concrete Concrete Concrete Concrete Sfmt 4703 Department Contact Steel Steel Steel Steel Steel Steel Steel Wire Wire Wire Wire Wire Wire Wire Strand Strand Strand Strand Strand Strand Strand E:\FR\FM\01DEN1.SGM Dana Mermelstein Dana Mermelstein Dana Mermelstein Dana Mermelstein Dana Mermelstein Dana Mermelstein Brandon Farlander 01DEN1 (202) (202) (202) (202) (202) (202) (202) 482–1391 482–1391 482–1391 482–1391 482–1391 482–1391 482–0182

Agencies

[Federal Register Volume 73, Number 231 (Monday, December 1, 2008)]
[Notices]
[Pages 72767-72770]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-28458]


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

DEPARTMENT OF COMMERCE

International Trade Administration

A-570-882


Refined Brown Aluminum Oxide from the People's Republic of China: 
Preliminary Results of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: In response to a request from an interested party, the 
Department of Commerce (the Department) is conducting the 2006-2007 
administrative review of the antidumping duty order on refined brown 
aluminum oxide (RBAO) from the People's Republic of China (PRC). The 
review covers one exporter, Qingdao Shunxingli Abrasives Co. Ltd. 
(Qingdao Shunxingli). The period of review (POR) is November 1, 2006, 
to October 31, 2007.
    We have preliminarily determined that sales have been made at 
prices below normal value by Qingdao Shunxingli. If these preliminary 
results are adopted in our final results of administrative review, we 
will instruct U.S. Customs and Border Protection (CBP) to assess 
antidumping duties on all appropriate entries.
    We invite interested parties to comment on these preliminary 
results. Parties who submit comments in this review are requested to 
submit with each argument (1) a statement of the issue and (2) a brief 
summary of the argument.

EFFECTIVE DATE: December 1, 2008.

FOR FURTHER INFORMATION CONTACT: David Goldberger or Kate Johnson, AD/
CVD Operations, Office 2, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, N.W., Washington, D.C. 20230; telephone (202) 482-
4136 or (202) 482-4929, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On November 1, 2007, the Department published a notice of 
opportunity to request an administrative review of the antidumping duty 
order on, inter alia, RBAO from the PRC. See Antidumping or 
Countervailing Duty Order, Finding, or Suspended Investigation; 
Opportunity to Request Administrative Review, 72 FR 61859 (November 1, 
2007). In response, Fujimi Corporation (Fujimi), an importer of the 
subject merchandise, timely requested an administrative review of the 
antidumping duty order on RBAO from the PRC for entries of the subject 
merchandise during the POR from two PRC producers/exporters: Henan 
Yilong High and New Materials Co., Ltd. (Henan Yilong), and Qingdao 
Shunxingli.
    On December 27, 2007, the Department initiated a review on Henan 
Yilong and Qingdao Shunxingli. See Initiation of Antidumping and 
Countervailing Duty Administrative Reviews, 72 FR 73315 (December 27, 
2007).
    The Department issued antidumping duty questionnaires to Henan 
Yilong and Qingdao Shunxingli on January 7, 2008. We received responses 
to these questionnaires in March 2008. We issued a supplemental 
questionnaire to Henan Yilong in April 2008 and received a response 
later that month. We issued supplemental questionnaires to Qingdao 
Shunxingli in March, May, and July 2008. We received responses to these 
supplemental questionnaires in April, May, and July 2008, respectively.
    On May 23, 2008, Fujimi withdrew its request for review of Henan 
Yilong and requested that the Department rescind the review with 
respect to this company. In accordance with 19 CFR 351.213(d)(1), we 
granted Fujimi's request and rescinded this administrative review with 
respect to Henan Yilong. In addition, we extended the due date for 
completion of these preliminary results until not later than December 
1, 2008. See Refined Brown Aluminum Oxide from the People's Republic of 
China: Notice of Partial Rescission of Antidumping Duty Administrative 
Review and Extension of Time Limit for Preliminary Results, 73 FR 38173 
(July 3, 2008).

Scope of the Order

    The merchandise covered by this order is ground, pulverized or 
refined artificial corundum, also known as brown aluminum oxide or 
brown fused alumina, in grit size of 3/8 inch or less. Excluded from 
the scope of the order is crude artificial corundum in which particles 
with a diameter greater than 3/8 inch constitute at least 50 percent of 
the total weight of the entire batch. The scope includes brown 
artificial corundum in which particles with a diameter greater than 3/8 
inch constitute less than 50 percent of the total weight of the batch. 
The merchandise under investigation is currently classifiable under 
subheadings 2818.10.20.00 and 2818.10.20.90 of the Harmonized Tariff 
Schedule of the United States (HTSUS). Although the HTSUS subheading is 
provided for convenience and customs purposes, the written description 
of the merchandise covered by the order is dispositive.

NME Country Status

    In every case conducted by the Department involving the PRC, the 
PRC has been treated as a non-market-economy (NME) country. In 
accordance with section 771(18)(C)(i) of the Tariff Act of 1930, as 
amended (the Act), any determination that a foreign country is an NME 
country shall remain in effect until revoked by the administering 
authority. See Brake Rotors From the People's Republic of China: 
Preliminary Results and Partial Rescission of the 2004/2005 
Administrative Review and Notice of of Intent to Rescind the 2004/2005 
New Shipper Review, 71 FR 26736, (May 8, 2006); unchanged in Brake 
Rotors From the People's Republic of China: Final Results and Partial 
Rescission of the 2004/2005 Administrative Review and Notice of 
Rescission of 2004/2005 New Shipper Review, 71 FR 66304 (November 14, 
2006). None of the parties to this proceeding has contested such 
treatment. Accordingly, we have calculated normal value in accordance 
with section 773(c) of the Act, which applies to NME countries.

[[Page 72768]]

Separate Rates

    As explained above, a designation of a country as an NME remains in 
effect until it is revoked by the Department. See section 771(18)(C) of 
the Act. Accordingly, there is a rebuttable presumption that all 
companies within the PRC are subject to government control and, thus, 
should be assessed a single antidumping duty rate. It is the 
Department's standard policy to assign all exporters of the merchandise 
subject to review in NME countries a single rate unless an exporter can 
affirmatively demonstrate an absence of government control, both in law 
(de jure) and in fact (de facto), with respect to exports. See Policy 
Bulletin 05.1 entitled ``Separate Rate Practice and Application of 
Combination Rates in Antidumping Duty Investigations Involving Non-
Market Economy Countries,'' dated April 5, 2005. To establish whether a 
company is sufficiently independent to be entitled to a separate, 
company-specific rate, the Department analyzes each exporting entity in 
an NME country under the test established in the Final Determination of 
Sales at Less Than Fair Value: Sparklers from the People's Republic of 
China, 56 FR 20588 (May 6, 1991) (Sparklers), as amplified by the 
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).
    The Department's separate-rate test determines whether the 
exporters are independent from government control and does not 
consider, in general, macroeconomic or border-type controls, e.g., 
export licenses, quotas, and minimum export prices, particularly if 
these controls are imposed to prevent dumping. The test focuses, 
rather, on controls over the investment, pricing, and output decision-
making process at the individual firm level. See, e.g., Notice of Final 
Determination of Sales at Less Than Fair Value: Certain Cut-to-Length 
Carbon Steel Plate From Ukraine, 62 FR 61754, 61757 (November 19, 
1997).
     Qingdao Shunxingli provided complete separate-rate information in 
its responses to our original and supplemental questionnaires. Qingdao 
Shunxingli is a wholly Chinese-owned company. Therefore, the Department 
must analyze whether Qingdao Shunxingli can demonstrate the absence of 
both de jure and de facto governmental control over export activities.

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 at Comment 1. As discussed below, our analysis shows that the 
evidence on the record supports a preliminary finding of an absence of 
de jure government control for Qingdao Shunxingli based on each of 
these factors.
    The evidence provided by Qingdao Shunxingli supports a preliminary 
finding of de jure absence of governmental control based on the 
following facts: (1) an absence of restrictive stipulations associated 
with the individual exporter's 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., ``The Company Law of 
the People's Republic of China,'' submitted as Exhibit A-2 to Qingdao 
Shunxingli's March 5, 2008, response to Section A of the Department's 
questionnaire (QRA).

Absence of De Facto Control

    Typically, the Department considers four factors in evaluating 
whether a respondent is subject to de facto government control of its 
export functions: (1) whether the export prices are set by, or subject 
to, the approval of a government authority; (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 its 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 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 governmental control which would preclude the Department from 
assigning separate rates.
    With respect to de facto control, Qingdao Shunxingli reported that: 
(1) it independently set prices for sales to the United States through 
negotiations with customers and these prices are not subject to review 
by any government organization; (2) it did not coordinate with other 
exporters or producers to set the price or to determine to which market 
it will sell subject merchandise; (3) the PRC Chamber of Commerce did 
not coordinate its export activities; (4) its staff has the authority 
to contractually bind it to sell subject merchandise; (5) its 
management is selected without any government control or review; (6) 
there is no restriction on its use of export revenues; (7) its 
management ultimately determines the disposition of respective profits, 
and Qingdao Shunxingli has not had a loss on its export sales in the 
last two years; and (8) none of its managers is a government official. 
See QRA at pages A-2 - A-11. Furthermore, our analysis of Qingdao 
Shunxingli's questionnaire responses reveals no other information 
indicating government control of its export activities. Therefore, 
based on the information on the record, we preliminarily determine that 
there is an absence of de facto government control with respect to 
Qingdao Shunxingli's exports.
    In summary, the evidence placed on the record of this review by 
Qingdao Shunxingli demonstrates an absence of de jure and de facto 
government control with respect to its exports of the merchandise under 
review, in accordance with the criteria identified in Sparklers and 
Silicon Carbide.

 Surrogate Country

    When the Department analyzes imports from an NME country, section 
773(c)(1) of the Act directs it to base normal value, in most 
circumstances, on the NME producer's factors of production (FOP), 
valued in a surrogate market-economy country or countries considered to 
be appropriate by the Department. In accordance with section 773(c)(4) 
of the Act, in valuing the FOP, the Department shall use, to the extent 
possible, the prices or costs of FOP in one or more market-economy 
countries that are at a level of economic development comparable to 
that of the NME country and that are significant producers of 
comparable merchandise. On January 14, 2008, the Department's Office of 
Policy issued a memorandum identifying India, the Philippines, Colombia 
and Thailand as being at a level of economic development comparable to 
the PRC for the POR. See Memorandum entitled ``Administrative Review of 
the Antidumping Order on

[[Page 72769]]

Refined Brown Aluminum Oxide from the People's Republic of China (PRC): 
Request for a List of Surrogate Countries,'' dated January 14, 2008. 
After consideration of the relevant factors for surrogate country 
selection, the Department determined that India is the appropriate 
surrogate country for this review. See Memorandum entitled 
``Administrative Review of the Antidumping Duty Order on Refined Brown 
Aluminum Oxide from the People's Republic of China: Selection of a 
Surrogate Country,'' dated February 12, 2008. The sources of the 
surrogate factor values are discussed under the ``Normal Value'' 
section below and in the Memorandum entitled ``Preliminary Results 
Valuation Memorandum'' (Valuation Memo), dated contemporaneously with 
this notice.

U.S. Price

A. Export Price

    In accordance with section 772(a) of the Act, we based U.S. price 
on the export price (EP) for sales to the United States made by Qingdao 
Shunxingli because the first sale to an unaffiliated party was made 
before the date of importation and the use of constructed EP was not 
otherwise warranted. We calculated EP for Qingdao Shunxingli based on 
the prices to unaffiliated purchasers in the United States.
    In accordance with section 772(c) of the Act, we deducted from the 
price to unaffiliated purchasers, where appropriate, foreign inland 
freight, brokerage and handling, and international freight expenses.
    As foreign inland freight and brokerage and handling services were 
provided by NME service providers, we valued these services using 
surrogate values. See Valuation Memo. For those international freight 
services that were provided by a market-economy provider and for which 
Qingdao Shunxingli paid in a market-economy currency, we deducted the 
actual expenses incurred. For those international freight services that 
were provided by an NME provider, we valued them using the weighted-
average of the international freight expenses charged by market-economy 
providers, as described in the Valuation Memo.


Normal Value

A. Methodology

    Section 773(c)(1)(B) of the Act provides that the Department shall 
determine the normal value using a FOP methodology if the merchandise 
is exported from a NME country and the information does not permit the 
calculation of normal value using home-market prices, third-country 
prices, or constructed value under section 773(a) of the Act. The 
Department bases normal value on the FOP because the presence of 
government controls on various aspects of NME countries renders price 
comparisons and the calculation of production costs invalid under the 
Department's normal methodologies. See Tapered Roller Bearings and 
Parts Thereof, Finished or Unfinished, From the People's Republic of 
China: Preliminary Results of Antidumping Duty Administrative Review 
and Notice of Intent to Rescind in Part, 70 FR 39744 (July 11, 2005) 
(unchanged in Tapered Roller Bearings and Parts Thereof, Finished and 
Unfinished, from the People's Republic of China: Final Results of 2003-
2004 Administrative Review and Partial Rescission of Review, 71 FR 2517 
(January 17, 2006)).
    The FOP for RBAO include the following elements: (1) quantities of 
raw materials employed; (2) hours of labor required; (3) amounts of 
energy and other utilities consumed; (4) representative capital and 
selling costs; and (5) packing materials. We used the FOP reported by 
Qingdao Shunxingli for materials, labor, energy, and packing. Where 
appropriate, we adjusted the surrogate prices by including freight 
costs to make them delivered prices.

B. FOP Valuation

    In accordance with section 773(c) of the Act, we calculated normal 
value based on the FOP reported by Qingdao Shunxingli for the POR. To 
calculate normal value, we multiplied the reported per-unit factor-
consumption rates by publicly available surrogate values, in accordance 
with 19 CFR 351.408(c)(1). In selecting the surrogate values, we 
considered the quality, specificity, and contemporaneity of the data.
    Consistent with the Department's practice, we calculated price-
index adjustors to inflate or deflate, as appropriate, surrogate values 
that are not contemporaneous with the POR using the wholesale price 
index or equivalent for the subject country. See, e.g., Chlorinated 
Isocyanurates from the People's Republic of China: Preliminary Results 
of Antidumping Duty Administrative Review, 73 FR 24943 (May 6, 2008); 
unchanged in Chlorinated Isocyanurates from the People's Republic of 
China: Final Results of Antidumping Duty Administrative Review, 73 FR 
52645 (September 10, 2008). The methodology which we applied in this 
review is detailed in the Valuation Memo.
    We were unable to identify an appropriate surrogate value from 
India for the crude brown aluminum oxide raw material input. Therefore, 
we used a weighted-average U.S. price, derived from the data reported 
in the Defense Logistics Agency FY2000 Annual Report. Our selection of 
this value is further discussed in the Valuation Memo. The sources and 
data we used to determine the surrogate values for the other FOP, as 
well as the surrogate financial ratios for factory overhead, selling, 
general and administrative expenses (SG&A), and profit, are discussed 
in detail in the Valuation Memo.

Preliminary Results of the Review

    As a result of our review, we preliminarily determine that the 
following percentage weighted-average dumping margin exists for the 
period November 1, 2006, through October 31, 2007:

------------------------------------------------------------------------
                Manufacturer/Exporter                   Percent Margin
------------------------------------------------------------------------
Qingdao Shunxingli Abrasives Co. Ltd................               54.62
------------------------------------------------------------------------

Comments

    We will disclose the calculations used in our analysis to parties 
in this review within five days of the date of publication of this 
notice in accordance with 19 CFR 351.224(b). Interested parties may 
submit publicly available information to value factors no later than 20 
days after the date of publication of these preliminary results of 
review. See 19 CFR 351.301(c)(3)(ii). Any interested party may request 
a hearing within 30 days of the date of publication of this notice. See 
19 CFR 351.310(c). Interested parties who wish to request a hearing or 
to participate in a hearing if a hearing is requested must submit a 
written request to the Assistant Secretary for Import Administration 
within 30 days after the date of publication of this notice. See 19 CFR 
351.310(c). Requests should contain the following: (1) the party's 
name, address, and telephone number; (2) the number of participants; 
and (3) a list of issues to be discussed. Issues raised in the hearing 
will be limited to those raised in the case and rebuttal briefs. See 19 
CFR 351.310(c). Case briefs from interested parties may be submitted 
not later than 30 days after the date of publication of this notice of 
preliminary results of review. See 19 CFR 351.309(c)(1)(ii). Rebuttal 
briefs from interested parties, limited to the issues raised in the 
case briefs, may be

[[Page 72770]]

submitted not later than five days after the time limit for filing the 
case briefs. See 19 CFR 351.309(d)(1). If requested, any hearing will 
be held two days after the scheduled date for submission of rebuttal 
briefs. See 19 CFR 351.310(d). Parties who submit case briefs or 
rebuttal briefs in this proceeding are encouraged to submit with each 
argument a statement of the issue, a summary of the arguments not 
exceeding five pages, and a table of statutes, regulations, and cases 
cited. See 19 CFR 351.309(c)(2).
    The Department will issue the final results of this administrative 
review, including the results of its analysis of issues raised in any 
such written briefs or at the hearing, if held, not later than 120 days 
after the date of publication of this notice. See section 751(a)(3)(A) 
of the Act.

Assessment Rates

    The Department shall determine, and CBP shall assess, antidumping 
duties on all appropriate entries. The Department intends to issue 
assessment instructions to CBP 15 days after the date of publication of 
the final results of review.
    Pursuant to 19 CFR 351.212(b)(1), we will calculate importer-
specific ad valorem duty assessment rates based on the ratio of the 
total amount of the dumping margins calculated for the examined sales 
to the total entered value of those same sales. We will instruct CBP to 
assess antidumping duties on all appropriate entries covered by this 
review if any importer-specific assessment rate calculated in the final 
results of this review is above de minimis. The final results of this 
review shall be the basis for the assessment of antidumping duties on 
entries of merchandise covered by the final results of this review and 
for future deposits of estimated duties, where applicable.

Cash-Deposit Requirements

    The following cash deposit requirements will be effective upon 
publication of the notice of final results of the administrative review 
for all shipments of RBAO from the PRC entered, or withdrawn from 
warehouse, for consumption on or after the date of publication, as 
provided by section 751(a)(2)(C) of the Act: (1) for subject 
merchandise exported by Qingdao Shunxingli, the cash-deposit rate will 
be that established in the final results of review; (2) for previously 
reviewed or investigated companies not listed above that have separate 
rates, the cash-deposit rate will continue to be the company-specific 
rate published for the most recent period; (3) for all other PRC 
exporters of subject merchandise, which have not been found to be 
entitled to a separate rate, the cash-deposit rate will be PRC-wide 
rate of 135.18 percent; and (4) for all non-PRC exporters of subject 
merchandise, the cash-deposit rate will be the rate applicable to the 
PRC exporter that supplied that exporter. These deposit requirements, 
when imposed, shall remain in effect until further notice.

Notification to Importers

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

    Dated: November 21, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E8-28458 Filed 11-28-08; 8:45 am]
BILLING CODE 3510-DS-S