Certain Kitchen Appliance Shelving and Racks From the People's Republic of China: Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination, 9591-9604 [E9-4612]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 74, Number 42 (Thursday, March 5, 2009)]
[Notices]
[Pages 9591-9604]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-4612]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-941]


Certain Kitchen Appliance Shelving and Racks From the People's 
Republic of China: Preliminary Determination of Sales at Less Than Fair 
Value and Postponement of Final Determination

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

DATES: Effective Date: March 5, 2009.

SUMMARY: We preliminarily determine that certain kitchen appliance 
shelving and racks 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 (``Act''). The estimated margins of sales at LTFV are shown 
in the ``Preliminary Determination'' section of this notice. Interested 
parties are invited to comment on this preliminary determination.

FOR FURTHER INFORMATION CONTACT: Julia Hancock or Katie Marksberry, AD/
CVD Operations, Office 9, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington DC 20230; telephone: (202) 482-
1394 or (202) 482-7906, respectively.

SUPPLEMENTARY INFORMATION: 

Initiation

    On July 31, 2008, Nashville Wire Products Inc., SSW Holding 
Company, Inc., United Steel, Paper and Forestry, Rubber Manufacturing, 
Energy, Allied-Industrial and Service Workers International Union, and 
the International Association of Machinists & Aerospace Workers, 
District Lodge 6 (Clinton IA) (hereafter referred to as the 
``Petitioners'') filed a antidumping duty petition on PRC imports of 
kitchen appliance shelving and racks. See Petition for the Imposition 
of Antidumping Duties: Certain Kitchen Appliance Shelving and Racks 
From the People's Republic of China (in two volumes), dated July 31, 
2008 (``Petition''). The Department of Commerce (``Department'') 
initiated this investigation on August 20, 2008. See Certain Kitchen 
Appliance Shelving and Racks From the People's Republic of China: 
Initiation of Antidumping Duty Investigation, 73 FR 50596 (August 27, 
2008) (``Initiation Notice'').
    On September 22, 2008, the United States International Trade 
Commission (``ITC'') issued its affirmative preliminary determination 
that there is a reasonable indication that an industry in the United 
States is materially injured by reason of imports from the PRC of 
certain kitchen appliance shelving and racks. The ITC's determination 
was published in the Federal Register on September 24, 2008. See 
Certain Kitchen Appliance Shelving and Racks From China, 73 FR 55132 
(September 24, 2008); see also Certain Kitchen Appliance Shelving and 
Racks From China: Investigation No. 731-TA-458 and 731-TA-1154 
(Preliminary), USITC Publication 4035 (September 2008).

Scope Comments

    In accordance with the preamble to our regulations, 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. See Antidumping Duties; 
Countervailing Duties; Final Rule, 62 FR 27296, 27323 (May 19, 1997). 
See also Initiation Notice, 73 FR at 50596. We received no comments 
from interested parties on issues related to the scope. However, on 
February 5, 2009, we placed a memorandum to the file on the record of 
this investigation stating that the companion countervailing duty 
investigation team at the Department spoke with the National Import 
Specialist at U.S. Customs and Border Protection (``CBP'') who 
indicated the Department should include the additional Harmonized 
Tariff Schedule of the United States (``USHTS'') number 8418.99.80.60 
to the scope of the investigation. See Memorandum to the File from 
Katie Marksberry dated February 5, 2009. Therefore, we are adding the 
HTS number 8418.99.80.60 to the scope of this investigation for this 
preliminary determination. The Department did not receive any comments 
on the change to the scope of this investigation. See ``Scope of 
Investigation'' section below.

Period of Investigation

    The period of investigation (``POI'') is January 1, 2008, through 
June 30, 2008. This period corresponds to the two most recent fiscal 
quarters prior to the month of the filing of the petition (July 31, 
2008). See 19 CFR 351.204(b)(1).

Respondent Selection

    In the Initiation Notice, the Department stated that it intended to 
select respondents based on quantity and value (``Q&V'') 
questionnaires. See Initiation Notice, 73 FR at 50598-50599. On 
September 8, 2008, the Department requested Q&V information from the 12 
companies that Petitioners identified as potential exporters or 
producers of certain kitchen appliance shelving and racks from the PRC. 
See Petition at Vol 1., Exhibit 3. Additionally, the Department also 
posted the Q&V questionnaire for this investigation on its Web site at 
www.trade.gov/ia.
    The Department received timely Q&V responses from six exporters 
that shipped merchandise under investigation to the United States 
during the POI, and from one company who stated it had no shipments of 
merchandise under investigation to the United States during the POI. On

[[Page 9592]]

October 8, 2008, the Department selected Guandong Wireking Housewares & 
Hardware Co., Ltd. (``Wireking'') and Asber Enterprise Co., Ltd. 
(China) (``Asber'') as mandatory respondents in this investigation. See 
October 8, 2008, Memorandum to the File, from Julia Hancock, Senior 
International Trade Analyst, through Catherine Bertrand, Program 
Manager, and James C. Doyle, Director, to Stephen J. Claeys, Deputy 
Assistant Secretary, regarding Selection of Respondents for the 
Antidumping Investigation of Certain Kitchen Appliance Shelving and 
Racks from the People's Republic of China (``Respondent Selection 
Memo''). The Department sent its antidumping duty questionnaire to 
Asber and Wireking on October 8, 2008. On October 23, 2008, Asber filed 
a letter stating that it will not participate as a mandatory respondent 
in this investigation. See Letter to the Department from Asber dated 
October 23, 2008. On November 19, 2008, the Department selected New 
King Shan (Zhu Hai) Co., Ltd. (``New King Shan'') as an additional 
mandatory respondent because it was the next largest producer/exporter 
of those companies that submitted Q&V responses. See November 19, 2008, 
Memorandum to the File, from Julia Hancock, Senior International Trade 
Analyst and Blaine Wiltse, International Trade Analyst, through 
Catherine Bertrand, Program Manager, and James C. Doyle, Director, to 
Stephen J. Claeys, Deputy Assistant Secretary, regarding Selection of 
an Additional Mandatory Respondent. (``Additional Respondent Selection 
Memo'').

Separate Rates Applications

    Between October 23, 2008, and October 29, 2008, we received timely 
filed separate-rate applications (``SRA'') from three companies: 
Jiangsu Weixi Group Co., Marmon Retail Services Asia, and Hangzhou 
Dunli Import & Export Co., Ltd.

Product Characteristics & Questionnaires

    In the Initiation Notice, the Department asked all parties in this 
investigation for comments on the appropriate product characteristics 
for defining individual products. On September 29, 2008, we received 
comments from Petitioners regarding product characteristics. On October 
8, 2008 the Department issued its antidumping duty questionnaire to 
Asber and Wireking, and on November 21, 2008, the Department issued its 
antidumping duty questionnaire to New King Shan. Wireking and New King 
Shan submitted responses to the Department's questionnaire. As stated 
above, Asber did not submit questionnaire responses.

Surrogate Country Comments

    On September 29, 2008, the Department determined that India, 
Indonesia, the Philippines, Colombia, and Thailand are countries 
comparable to the PRC in terms of economic development. See Letter to 
All Interested Parties, from Catherine Bertrand, Program Manager, 
Office 9, AD/CVD Operations, regarding ``Antidumping Duty Investigation 
of Kitchen Appliance Shelving and Racks From the People's Republic of 
China,'' (``Surrogate Country Letter''), attaching September 29, 2008, 
Memorandum to Catherine Bertrand, Program Manager, Office 9, AD/CVD 
Operations, from Carole Showers, Acting Director, Office of Policy, 
regarding ``Antidumping Duty Investigation of Kitchen Appliance 
Shelving and Racks from the People's Republic of China (PRC): Request 
for List of Surrogate Countries.''
    On September 29, 2008, the Department requested comments on 
surrogate country selection from the interested parties in this 
investigation. On January 26, 2009, Petitioners submitted surrogate 
country comments. No other interested parties commented on the 
selection of a surrogate country. For a detailed discussion of the 
selection of the surrogate country, see ``Surrogate Country'' section 
below.

Surrogate Value Comments

    On December 4, 2008, December 17, 2008, and January 21, 2009, the 
Department extended the deadline for interested parties to submit 
surrogate information with which to value the factors of production in 
this proceeding. On January 26, 2009, Petitioners and Wireking 
submitted surrogate value comments. On February 2, 2009, Petitioners 
and Wireking submitted clarifying surrogate value comments.

Postponement of Preliminary Determination

    Pursuant to section 733(c) of the Act and 19 CFR 351.205(f)(1), the 
Department extended the preliminary determination by 50 days. The 
Department published a postponement of the preliminary determination on 
December 23, 2008. See Certain Kitchen Appliance Shelving and Racks 
From the People's Republic of China: Postponement of Preliminary 
Determination of the Antidumping Duty Investigation, 73 FR 78721 
(December 23, 2008).

Scope of Investigation

    The scope of this investigation consists of shelving and racks for 
refrigerators, freezers, combined refrigerator-freezers, other 
refrigerating or freezing equipment, cooking stoves, ranges, and ovens 
(``certain kitchen appliance shelving and racks'' or ``the merchandise 
under investigation''). Certain kitchen appliance shelving and racks 
are defined as shelving, baskets, racks (with or without extension 
slides, which are carbon or stainless steel hardware devices that are 
connected to shelving, baskets, or racks to enable sliding), side racks 
(which are welded wire support structures for oven racks that attach to 
the interior walls of an oven cavity that does not include support ribs 
as a design feature), and subframes (which are welded wire support 
structures that interface with formed support ribs inside an oven 
cavity to support oven rack assemblies utilizing extension slides) with 
the following dimensions:
    -- Shelving and racks with dimensions ranging from 3 inches by 5 
inches by 0.10 inch to 28 inches by 34 inches by 6 inches; or
    -- Baskets with dimensions ranging from 2 inches by 4 inches by 3 
inches to 28 inches by 34 inches by 16 inches; or
    -- Side racks from 6 inches by 8 inches by 0.1 inch to 16 inches by 
30 inches by 4 inches; or
    -- Subframes from 6 inches by 10 inches by 0.1 inch to 28 inches by 
34 inches by 6 inches.
    The merchandise under investigation is comprised of carbon or 
stainless steel wire ranging in thickness from 0.050 inch to 0.500 inch 
and may include sheet metal of either carbon or stainless steel ranging 
in thickness from 0.020 inch to 0.2 inch. The merchandise under 
investigation may be coated or uncoated and may be formed and/or 
welded. Excluded from the scope of this investigation is shelving in 
which the support surface is glass.
    The merchandise subject to this investigation is currently 
classifiable in the Harmonized Tariff Schedule of the United States 
(``HTSUS'') statistical reporting numbers 8418.99.8050, 8418.99.8060, 
7321.90.5000, 7321.90.6090, and 8516.90.8000. Although the HTSUS 
subheadings are provided for convenience and customs purposes, the 
written description of the scope of this investigation is dispositive.

Non-Market Economy Country

    For purposes of initiation, Petitioners submitted LTFV analyses for 
the PRC as a non-market economy (``NME''). See

[[Page 9593]]

Initiation Notice, 73 FR at 50598. The Department considers the PRC to 
be a NME country. See Preliminary Determination of Sales at Less Than 
Fair Value and Postponement of Final Determination: Coated Free Sheet 
Paper From the People's Republic of China, 72 FR 30758, 30760 (June 4, 
2007), unchanged in Final Determination of Sales at Less Than Fair 
Value: Coated Free Sheet Paper From the People's Republic of China, 72 
FR 60632 (October 25, 2007). In accordance with section 771(18)(C)(i) 
of the Act, any determination that a foreign country is an NME country 
shall remain in effect until revoked by the administering authority. No 
party has challenged the designation of the PRC as an NME country in 
this investigation. Therefore, we continue to treat the PRC as an NME 
country for purposes of this preliminary determination.

Surrogate Country

    When the Department is investigating imports from an NME, 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 FOPs, the Department shall utilize, to the 
extent possible, the prices or costs of FOPs in one or more market-
economy countries that are at a level of economic development 
comparable to that of the NME country and are significant producers of 
comparable merchandise. The sources of the surrogate values we have 
used in this investigation are discussed under the ``Normal Value'' 
section below.
    The Department's practice with respect to determining economic 
comparability is explained in Policy Bulletin 04.1,\1\ which states 
that ``OP (Office of Policy) determines per capita economic 
comparability on the basis of per capita gross national income, as 
reported in the most current annual issue of the World Development 
Report (The World Bank).'' The Department considers the five countries 
identified in its Surrogate Country List as ``equally comparable in 
terms of economic development.'' See Policy Bulletin 04.1 at 2. Thus, 
we find that India, Indonesia, the Philippines, Colombia, and Thailand 
are all at an economic level of development equally comparable to that 
of the PRC.
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    \1\ See Policy Bulletin 04.1: Non-Market Economy Surrogate 
Country Selection Process, (March 1, 2004), (``Policy Bulletin 
04.1'') at Attachment II of the Department's Surrogate Country 
Letter, also available at https://ia.ita.doc.gov/policy/bull04-1.html
_____________________________________-

 Policy Bulletin 04.1 provides some guidance on identifying 
comparable merchandise and selecting a producer of comparable 
merchandise. As noted in the Policy Bulletin, comparable merchandise is 
not defined in the statute or the regulations, since it is best 
determined on a case-by-case basis. See Policy Bulletin 04.1 at 2. As 
further noted in Policy Bulletin 04.1, in all cases, if identical 
merchandise is produced, the country qualifies as a producer of 
comparable merchandise. Id.
    The Department examined worldwide export data for comparable 
merchandise, using the six-digit level of the HTS numbers listed in the 
scope language for this investigation.\2\ Specifically, we reviewed the 
POI export data from the World Trade Atlas (``WTA'') for the HTS 
headings 7321.09, 8516.90, 8418.99. The Department found that, of the 
countries provided in the Surrogate Country List, all five countries 
were exporters of comparable merchandise. Thus, all countries on the 
Surrogate Country List are considered as appropriate surrogates because 
each exported comparable merchandise.
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    \2\ Because the Department was unable to find production data, 
we relied on export data as a substitute for overall production data 
in this case.
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    The Policy Bulletin 04.1 also provides some guidance on identifying 
significant producers of comparable merchandise and selecting a 
producer of comparable merchandise. Further analysis was required to 
determine whether any of the countries which produce comparable 
merchandise are ``significant'' producers of that comparable 
merchandise. The data we obtained shows that, during the POI, worldwide 
exports for these HTS numbers were: 2,396,007 kilograms from Colombia; 
1,758,325 kilograms from India; 6,615,309 kilograms from Indonesia; 
450,110 kilograms from Philippines; and 8,833,547 kilograms from 
Thailand. Thus, all countries on the Surrogate Country List are 
considered as appropriate surrogates because each exported significant 
comparable merchandise. Finally, we have reliable data from India on 
the record that we can use to value the FOPs. Petitioners and Wireking 
submitted surrogate values using Indian sources, suggesting greater 
availability of appropriate surrogate value data in India.
    As noted above, the Department only received surrogate country 
comments from Petitioners, which favored selection of India. The 
Department is preliminarily selecting India as the surrogate country on 
the basis that: (1) It is at a similar level of economic development 
pursuant to section 773(c)(4) of the Act; (2) it is a significant 
producer of comparable merchandise; and (3) we have reliable data from 
India that we can use to value the FOPs. Thus, we have calculated NV 
using Indian prices when available and appropriate to the respondents' 
FOPs. See Memorandum to the File from Julia Hancock, through Catherine 
Bertrand, Program Manager, AD/CVD Operations, Office 9, and James C. 
Doyle, Director, AD/CVD Operations, Office 9: Certain Kitchen Appliance 
Shelving and Racks from the People's Republic of China: Surrogate 
Values for the Preliminary Determination, (February 26, 2009) 
(``Surrogate Value Memorandum''). In accordance with 19 CFR 
351.301(c)(3)(i), for the final determination in an antidumping 
investigation, interested parties may submit publicly available 
information to value the FOPs within 40 days after the date of 
publication of the preliminary determination.\3\
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    \3\ In accordance with 19 CFR 351.301(c)(1), for the final 
determination of this investigation, interested parties may submit 
factual information to rebut, clarify, or correct factual 
information submitted by an interested party less than ten days 
before, on, or after, the applicable deadline for submission of such 
factual information. However, the Department notes that 19 CFR 
351.301(c)(1) permits new information only insofar as it rebuts, 
clarifies, or corrects information recently placed on the record. 
The Department generally will not accept the submission of 
additional, previously absent-from-the-record alternative surrogate 
value information pursuant to 19 CFR 351.301(c)(1). See Glycine from 
the People's Republic of China: Final Results of Antidumping Duty 
Administrative Review and Final Rescission, in Part, 72 FR 58809 
(October 17, 2007) and accompanying Issues and Decision Memorandum 
at Comment 2.
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Affiliations

    Section 771(33) of the Act, provides that:
    The following persons shall be considered to be ``affiliated'' or 
``affiliated persons'':
    (A) Members of a family, including brothers and sisters (whether by 
the whole or half blood), spouse, ancestors, and lineal descendants.
    (B) Any officer or director of an organization and such 
organization.
    (C) Partners.
    (D) Employer and employee.
    (E) Any person directly or indirectly owning, controlling, or 
holding with power to vote, 5 percent or more of the outstanding voting 
stock or shares of any organization and such organization.
    (F) Two or more persons directly or indirectly controlling, 
controlled by, or under common control with, any person.

[[Page 9594]]

    (G) Any person who controls any other person and such other person.
    Additionally, section 771(33) of the Act stipulates that: ``For 
purposes of this paragraph, a person shall be considered to control 
another person if the person is legally or operationally in a position 
to exercise restraint or direction over the other person.''

Wireking

    Based on the evidence on the record in this investigation and based 
on the evidence presented in Wireking's questionnaire responses, we 
preliminarily find that Wireking is affiliated with Company G,\4\ which 
was involved in Wireking's sales process, and other companies, pursuant 
to sections 771(33)(E), (F) and (G) of the Act, based on ownership and 
common control. In addition to being affiliated, there is a significant 
potential for price manipulation based on the level of common ownership 
and control, shared management, shared offices, and an intertwining of 
business operations. See 19 CFR 351.401(f)(1) and (2). Accordingly, we 
find that Wireking and Company G should be considered as a single 
entity for purposes of this investigation. See 19 CFR 351.401(f). For a 
detailed discussion of this issue, see Wireking Affiliation Memo.
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    \4\ The identity of this company is business proprietary 
information; for further discussion of this company, see Memorandum 
to Catherine Bertrand, Program Manager, AD/CVD Operations, Office 9, 
from Julia Hancock, Senior Case Analyst, AD/CVD Operations, Office 
9: Preliminary Determination in the Antidumping Duty Investigation 
of Certain Kitchen Appliance Shelving and Racks from the People's 
Republic of China: Affiliation Memorandum of Wireking, (February 26, 
2009)(''Wireking Affiliation Memo'').
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New King Shan

    Based on the evidence on the record in this investigation and based 
on the evidence presented in New King Shan's questionnaire responses, 
we preliminarily find that New King Shan is affiliated with Company A, 
Company B, Company C, and Company D,\5\ pursuant to sections 
771(33)(A), (E), (F), and (G) of the Act, based on ownership and common 
control. For a detailed discussion of this issue, see New King Shan 
Affiliation Memo.
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    \5\ The identites of these companies are business proprietary; 
for further discussion of these companies, see Memorandum to the 
File from Katie Marksberry, Case Analyst: Preliminary Determination 
of Antidumping Duty Investigation of Certain Kitchen Appliance 
Shelving and Racks from the People's Republic of China: Affiliation 
Memorandum of New King Shan (Zhuhai) Co., Ltd., (February 26, 2009) 
(``New King Shan Affiliation Memo'').
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Separate Rates

    In proceedings involving NME countries, there is a rebuttable 
presumption that all companies within the country are subject to 
government control and thus should be assessed a single antidumping 
duty rate. See Polyethylene Terephthalate Film, Sheet, and Strip from 
the People's Republic of China: Final Determination of Sales at Less 
Than Fair Value, 73 FR 55039, 55040 (Sept. 24, 2008) (PET Film LTFV 
Final). It is the Department's policy to assign all exporters of 
merchandise subject to investigation in an NME country this single rate 
unless an exporter can demonstrate that it is sufficiently independent 
so as to be entitled to a separate rate. See Final Determination of 
Sales at Less Than Fair Value: Sparklers From the People's Republic of 
China, 56 FR 20588 (May 6, 1991); see also 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), and section 
19 CFR 351.107(d) of the Department's regulations.
    In the Initiation Notice, the Department notified parties of the 
application process by which exporters and producers may obtain 
separate rate status in NME investigations. See Initiation Notice, 73 
FR at 17321. The process requires exporters and producers to submit a 
separate-rate status application. The Department's practice is 
discussed further in Policy Bulletin 05.1: Separate-Rates Practice and 
Application of Combination Rates in Antidumping Investigations 
Involving Non-Market Economy Countries, (April 5, 2005), (``Policy 
Bulletin 05.1'') available at https://ia.ita.doc.gov/policy/bull05-
1.pdf.\6\
_____________________________________-

 \6\ The Policy Bulletin 05.1, states: ``{w{time} hile continuing 
the practice of assigning separate rates only to exporters, all 
separate rates that the Department will now assign in its NME 
investigations will be specific to those producers that supplied the 
exporter during the period of investigation. Note, however, that one 
rate is calculated for the exporter and all of the producers which 
supplied subject merchandise to it during the period of 
investigation. This practice applies both to mandatory respondents 
receiving an individually calculated separate rate as well as the 
pool of non-investigated firms receiving the weighted-average of the 
individually calculated rates. This practice is referred to as the 
application of ``combination rates'' because such rates apply to 
specific combinations of exporters and one or more producers. The 
cash-deposit rate assigned to an exporter will apply only to 
merchandise both exported by the firm in question and produced by a 
firm that supplied the exporter during the period of investigation. 
See Policy Bulletin 05.1 at 6.
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    Jiangsu Weixi Group Co., Marmon Retail Services Asia, Hangzhou 
Dunli Import & Export Co., Ltd. (hereinafter referred to as ``Separate 
Rate Companies''), and Wireking and New King Shan, the mandatory 
respondents, have provided company-specific information to demonstrate 
that they operate independently of de jure and de facto government 
control or are wholly foreign owned, and therefore satisfy the 
standards for the assignment of a separate rate.
    We have considered whether each PRC company that submitted a 
complete application or complete Section A Response as a mandatory 
respondent is eligible for a separate rate. The Department's separate 
rate test is not concerned, in general, with macroeconomic/border-type 
controls, e.g., export licenses, quotas, and minimum export prices, 
particularly if these controls are imposed to prevent dumping. See 
Notice of Final Determination of Sales at Less Than Fair Value: Certain 
Preserved Mushrooms from the People's Republic of China, 63 FR 72255, 
72256 (December 31, 1998). The test focuses, rather, on controls over 
the investment, pricing, and output decision-making process at the 
individual firm level. See Certain Cut-to-Length Carbon Steel Plate 
from Ukraine: Final Determination of Sales at Less than Fair Value, 62 
FR 61754, 61758 (November 19, 1997), and Tapered Roller Bearings and 
Parts Thereof, Finished and Unfinished, from the People's Republic of 
China: Final Results of Antidumping Duty Administrative Review, 62 FR 
61276, 61279 (November 17, 1997).
    To establish whether a firm is sufficiently independent from 
government control of its export activities to be entitled to a 
separate rate, the Department analyzes each entity exporting the 
merchandise under investigation under a test arising from the Notice of 
Final Determination of Sales at Less Than Fair Value: Sparklers from 
the People's Republic of China, 56 FR 20588 (May 6, 1991) 
(``Sparklers''), as further developed in Notice of Final Determination 
of Sales at Less Than Fair Value: Silicon Carbide from the People's 
Republic of China, 59 FR 22585 (May 2, 1994) (``Silicon Carbide''). In 
accordance with the separate rate criteria, the Department assigns 
separate rates in NME cases only if respondents can demonstrate the 
absence of both de jure and de facto governmental control over export 
activities.
1. 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

[[Page 9595]]

and export licenses; (2) any legislative enactments decentralizing 
control of companies; and (3) other formal measures by the government 
decentralizing control of companies. See Sparklers, 56 FR at 20589.
    The evidence provided by the Separate Rate Companies, Wireking, and 
New King Shan supports a preliminary finding of de jure absence of 
governmental control based on the following: (1) An absence of 
restrictive stipulations associated with the individual exporter's 
business and export licenses; (2) the applicable legislative enactments 
decentralizing control of the companies; and (3) any other formal 
measures by the government decentralizing control of companies. See, 
e.g., Jiangsu Weixi Group Co.'s October 23, 2008, SRA at 5-8; Jiangsu 
Weixi Group Co.'s December 19, 2008, SRA at 4; Hangzhou Dunli Import & 
Export Co., Ltd.'s October 29, 2009, SRA at 12-17; New King Shan's 
October 27, 2008, SRA at 12-16; and Wireking's November 12, 2008 
Section A Response at 4-7.
2. Absence of De Facto Control
    Typically the Department considers four factors in evaluating 
whether each respondent is subject to de facto governmental control of 
its export functions: (1) Whether the export prices are set by or are 
subject to the approval of a governmental agency; (2) whether the 
respondent has authority to negotiate and sign contracts and other 
agreements; (3) whether the respondent has autonomy from the government 
in making decisions regarding the selection of management; and (4) 
whether the respondent retains the proceeds of its export sales and 
makes independent decisions regarding disposition of profits or 
financing of losses. See Silicon Carbide, 59 FR at 22586-87; see also 
Notice of Final Determination of Sales at Less Than Fair Value: 
Furfuryl Alcohol From the People's Republic of China, 60 FR 22544, 
22545 (May 8, 1995). The Department has determined that an analysis of 
de facto control is critical in determining whether respondents are, in 
fact, subject to a degree of governmental control which would preclude 
the Department from assigning separate rates.
    We determine that, for the Separate Rate Companies, Wireking, and 
New King Shan, the evidence on the record supports a preliminary 
finding of de facto absence of governmental control based on record 
statements and supporting documentation showing the following: (1) Each 
exporter sets its own export prices independent of the government and 
without the approval of a government authority; (2) each exporter 
retains the proceeds from its sales and makes independent decisions 
regarding disposition of profits or financing of losses; (3) each 
exporter has the authority to negotiate and sign contracts and other 
agreements; and 4) each exporter has autonomy from the government 
regarding the selection of management. See, e.g., Jiangsu Weixi Group 
Co.'s October 23, 2008, SRA at 9-15; Jiangsu Weixi Group Co.'s December 
19, 2008, SRA at 5; Hangzhou Dunli Import & Export Co., Ltd.'s October 
29, 2009, SRA at 21-25; New King Shan's October 27, 2008, SRA at 16-19; 
and Wireking's November 12, 2008 Section A Response at 7-11.
3. Wholly Foreign-Owned
    In its separate-rate application, one separate rate company, Marmon 
Retail Services Asia, reported that it is wholly owned by individuals 
or companies located in a market economy country. Therefore, because it 
is wholly foreign-owned, and we have no evidence indicating that it is 
under the control of the PRC, a separate rate analysis is not necessary 
to determine whether this company is independent from government 
control. See Notice of Final Determination of Sales at Less Than Fair 
Value: Creatine Monohydrate From the People's Republic of China, 64 FR 
71104-71105 (December 20, 1999) (where the respondent was wholly 
foreign-owned, and thus, qualified for a separate rate). Accordingly, 
we have preliminarily granted a separate rate to this company.
    The evidence placed on the record of this investigation by the 
Separate Rate Companies, Wireking, and New King Shan demonstrates an 
absence of de jure and de facto government control with respect to each 
of the exporter's exports of the merchandise under investigation, in 
accordance with the criteria identified in Sparklers and Silicon 
Carbide. As a result, we have granted the Separate Rate Companies a 
weighted-average margin based on the experience of mandatory 
respondents and excluding any de minimis or zero rates or rates based 
on total adverse facts available (``AFA'') for the purposes of this 
preliminary determination. In addition, for the reasons outlined above, 
we have preliminarily granted Wireking and New King Shan separate rate 
status.

Application of Adverse Facts Available, the PRC-Wide Entity and PRC-
Wide Rate

    The Department has data that indicate there were more exporters of 
certain kitchen appliance shelving and racks from the PRC than those 
indicated in the response to our request for Q&V information during the 
POI. See Respondent Selection Memorandum. We issued our request for Q&V 
information to 12 potential Chinese exporters of the merchandise under 
investigation, in addition to posting the Q&V questionnaire on the 
Department's Web site. While information on the record of this 
investigation indicates that there are other producers/exporters of 
certain kitchen appliance shelving and racks in the PRC, we received 
only seven timely filed Q&V responses. Although all exporters were 
given an opportunity to provide Q&V information, not all exporters 
provided a response to the Department's Q&V letter. Furthermore, Asber, 
which did respond to the Department's Q&V questionnaire and reported 
shipments during the POI, did not respond to the Department's full 
anti-dumping duty questionnaire. Therefore, the Department has 
preliminarily determined that there were exporters/producers of the 
merchandise under investigation during the POI from the PRC that did 
not respond to the Department's request for information. We have 
treated these PRC producers/exporters, including Asber, as part of the 
PRC-wide entity because they did not qualify for a separate rate. See, 
e.g., Preliminary Determination of Sales at Less Than Fair Value, 
Postponement of Final Determination, and Preliminary Partial 
Determination of Critical Circumstances: Diamond Sawblades and Parts 
Thereof From the People's Republic of China, 70 FR 77121, 77128 
(December 29, 2005), and unchanged in Final Determination of Sales at 
Less Than Fair Value and Final Partial Affirmative Determination of 
Critical Circumstances: Diamond Sawblades and Parts Thereof from the 
People's Republic of China, 71 FR 29303 (May 22, 2006).
    Section 776(a)(2) of the Act provides that, if an interested party 
(A) withholds information that has been requested by the Department, 
(B) fails to provide such information in a timely manner or in the form 
or manner requested, subject to subsections 782(c)(1) and (e) of the 
Act, (C) significantly impedes a proceeding under the antidumping 
statute, or (D) provides such information but the information cannot be 
verified, the Department shall, subject to subsection 782(d) of the 
Act, use facts otherwise available in reaching the applicable 
determination.
    Information on the record of this investigation indicates that the 
PRC-wide entity was non-responsive. Certain companies did not respond 
to our

[[Page 9596]]

questionnaire requesting Q&V information. As a result, pursuant to 
section 776(a)(2)(A) of the Act, we find that the use of facts 
available (``FA'') is appropriate to determine the PRC-wide rate. See 
Preliminary Determination of Sales at Less Than Fair Value, Affirmative 
Preliminary Determination of Critical Circumstances and Postponement of 
Final Determination: Certain Frozen Fish Fillets from the Socialist 
Republic of Vietnam, 68 FR 4986 (January 31, 2003), unchanged in Final 
Determination of Sales at Less Than Fair Value and Affirmative Critical 
Circumstances: Certain Frozen Fish Fillets from the Socialist Republic 
of Vietnam, 68 FR 37116 (June 23, 2003).
    Section 776(b) of the Act provides that, in selecting from among 
the facts otherwise available, the Department may employ an adverse 
inference if an interested party fails to cooperate by not acting to 
the best of its ability to comply with requests for information. See 
Statement of Administrative Action, accompanying the Uruguay Round 
Agreements Act (``URAA''), H.R. Rep. No. 103-316, 870 (1994) (``SAA''); 
see also Final Determination of Sales at Less Than Fair Value: Certain 
Cold-Rolled Flat-Rolled Carbon-Quality Steel Products from the Russian 
Federation, 65 FR 5510, 5518 (February 4, 2000). We find that, because 
the PRC-wide entity did not respond to our requests for information, it 
has failed to cooperate to the best of its ability. Therefore, the 
Department preliminarily finds that, in selecting from among the facts 
available, an adverse inference is appropriate.
    When employing an adverse inference, section 776 indicates that the 
Department may rely upon information derived from the petition, the 
final determination from the LTFV investigation, a previous 
administrative review, or any other information placed on the record. 
In selecting a rate for AFA, the Department selects a rate that is 
sufficiently adverse to ensure that the uncooperative party does not 
obtain a more favorable result by failing to cooperate than if it had 
fully cooperated. It is the Department's practice to select, as AFA, 
the higher of the (a) highest margin alleged in the petition, or (b) 
the highest calculated rate of any respondent in the investigation. See 
Final Determination of Sales at Less Than Fair Value: Certain Cold-
Rolled Carbon Quality Steel Products from the People's Republic of 
China, 65 FR 34660 (May 21, 2000) and accompanying Issues and Decision 
Memorandum, at Comment 1. As AFA, we have preliminarily assigned to the 
PRC-wide entity a rate of 96.45 percent, the average of all margins. 
The Department preliminarily determines that this information is the 
most appropriate from the available sources to effectuate the purposes 
of AFA. The Department's reliance on the petition rates to determine an 
AFA rate is subject to the requirement to corroborate secondary 
information.

Corroboration

    Section 776(c) of the Act provides that, when the Department relies 
on secondary information rather than on information obtained in the 
course of an investigation as facts available, it must, to the extent 
practicable, corroborate that information from independent sources 
reasonably at its disposal. The SAA provides guidance as to what 
constitutes secondary information. One of the suggested sources of 
secondary information is ``information derived from the petition that 
gave rise to the investigation or review, the final determination 
concerning the subject merchandise, or any previous review under 
section 751 concerning the subject merchandise.'' \7\ The SAA further 
suggests that to ``corroborate'' means that the Department will satisfy 
itself that the secondary information to be used has probative value. 
Id. Independent sources used to corroborate may include, for example, 
published price lists, official import statistics, and CBP data, and 
information obtained from interested parties during the particular 
investigation. Id. To corroborate secondary information, the Department 
will, to the extent practicable, examine the reliability and relevance 
of the information used.\8\
---------------------------------------------------------------------------

    \7\ See SAA at 870.
    \8\ See Tapered Roller Bearings and Parts Thereof, Finished and 
Unfinished, from Japan, and Tapered Roller Bearings, Four Inches or 
Less in Outside Diameter, and Components Thereof, from Japan; 
Preliminary Results of Antidumping Duty Administrative Reviews and 
Partial Termination of Administrative Reviews, 61 FR 57391, 57392 
(November 6, 1996), unchanged in Tapered Roller Bearings and Parts 
Thereof, Finished and Unfinished, From Japan, and Tapered Roller 
Bearings, Four Inches or Less in Outside Diameter, and Components 
Thereof, From Japan: Final Results of Antidumping Duty 
Administrative Reviews and Termination in Part:, 62 FR 11825 (March 
13, 1997).
---------------------------------------------------------------------------

    The AFA rate selected by the Department is from the petition.\9\ 
Petitioners' methodology for calculating the export price (``EP'') and 
NV in the petition is discussed in the Initiation Notice at 73 FR 50598 
and 50599. To corroborate the AFA margin that we selected, we compared 
the U.S. prices and normal values of the two mandatory respondents to 
the U.S. prices and normal values of the margins contained in the 
petition. All of the U.S. prices and normal values in the margins 
calculated in the petition are within the range of the U.S. prices and 
normal values of the mandatory respondents. Therefore, we took the 
simple average of all seven of the petition margins, which results in a 
margin of 96.45 percent. We find that the margin of 96.45 percent has 
probative value because it is the average of all petition margins which 
were based on the corroborated U.S. price and normal values in the 
petition which were corroborated by comparison of the U.S. price and 
normal values of the two mandatory respondents. Accordingly, we find 
that the rate of 96.45 percent is corroborated within the meaning of 
section 776(c) of the Act. Accordingly, we determine that 96.45 percent 
is the single antidumping rate for the PRC-wide entity. The PRC-wide 
rate applies to all entries of the merchandise under investigation 
except for entries from Wireking, New King Shan, and the Separate Rate 
Companies.
---------------------------------------------------------------------------

    \9\ See Petition, at Volume II, Exhibit 14.
---------------------------------------------------------------------------

Margin for the Separate Rate Companies

    The Department received timely and complete separate rate 
applications from the Separate Rate Companies, who are all exporters of 
certain kitchen appliance shelving and racks from the PRC, which were 
not selected as mandatory respondents in this investigation. Through 
the evidence in their applications, these companies have demonstrated 
their eligibility for a separate rate, see the ``Separate Rates'' 
section and in the Memorandum to the File, from Katie Marksberry, Case 
Analyst, AD/CVD Operations, Office 9: Preliminary Determination in the 
Antidumping Duty Investigation of Certain Kitchen Appliance Shelving 
and Racks from the People's Republic of China: Calculation of the 
Separate Rate Weighted-Average Margin, (February 26, 2009). Consistent 
with the Department's practice, as the separate rate, we have 
established a average margin for the Separate Rate Companies based on 
the rates we calculated for Wireking and New King Shan, excluding any 
rates that are zero, de minimis, or based entirely on AFA.\10\ Jiangsu 
Weixi Group Co., Marmon Retail Services Asia, and Hangzhou Dunli Import 
& Export Co., Ltd. are the companies receiving this

[[Page 9597]]

rate and are listed in the ``Suspension of Liquidation'' section of 
this notice.
---------------------------------------------------------------------------

    \10\ See, e.g., Preliminary Determination of Sales at Less Than 
Fair Value and Partial Affirmative Determination of Critical 
Circumstances: Certain Polyester Staple Fiber from the People's 
Republic of China, 71 FR 77373, 77377 (December 26, 2006) (``PSF''), 
unchanged in Final Determination of Sales at Less Than Fair Value 
and Partial Affirmative Determination of Critical Circumstances: 
Certain Polyester Staple Fiber from the People's Republic of China, 
72 FR 19690 (April 19, 2007).
---------------------------------------------------------------------------

Date of Sale

    19 CFR 351.401(i) states that, ``in identifying the date of sale of 
the merchandise under consideration or foreign like product, the 
Secretary normally will use the date of invoice, as recorded in the 
exporter or producer's records kept in the normal course of business.'' 
In Allied Tube, the Court of International Trade (``CIT'') noted that a 
``party seeking to establish a date of sale other than invoice date 
bears the burden of producing sufficient evidence to `satisf{y{time} ' 
the Department that `a different date better reflects the date on which 
the exporter or producer establishes the material terms of sale.' '' 
Allied Tube & Conduit Corp. v. United States 132 F. Supp. 2d at 1090 
(CIT 2001) (quoting 19 CFR 351.401(i)) (``Allied Tube''). Additionally, 
the Secretary 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. See 19 CFR 351.401(i); see also Allied Tube, 132 F. Supp. 2d 
1087, 1090-1092. The date of sale is generally the date on which the 
parties agree upon all substantive terms of the sale. This normally 
includes the price, quantity, delivery terms and payment terms. See 
Carbon and Alloy Steel Wire Rod from Trinidad and Tobago: Final Results 
of Antidumping Duty Administrative Review, 72 FR 62824 (November 7, 
2007) and accompanying Issue and Decision Memorandum at Comment 1; 
Notice of Final Determination of Sales at Less Than Fair Value: Certain 
Cold-Rolled Flat-Rolled Carbon Quality Steel Products from Turkey, 65 
FR 15123 (March 21, 2000) and accompanying Issues and Decision 
Memorandum at Comment 1.
    New King Shan reported that the date of sale was determined by the 
invoice issued by the affiliated importer to the unaffiliated United 
States customer. In this case, as the Department found no evidence 
contrary to New King Shan's claims that invoice date was the 
appropriate date of sale, the Department used invoice date as the date 
of sale for this preliminary determination.
    Wireking reported its U.S. sales as constructed export price 
(``CEP'') sales because the sales are not made until after importation 
to the United States. Wireking reported that while it issues a 
commercial invoice to the U.S. customer for the quantities of 
merchandise subject to the investigation that it shipped, the quantity 
of each sale is not fixed when it issues the commercial invoice to the 
U.S. customer. See Wireking's Supplemental Section C, (February 18, 
2009) at 20. According to Wireking, the U.S. customer does not agree to 
purchase the final quantity for each of Wireking's reported sales until 
the U.S. customer issues document X \11\ to Wireking, upon which 
payment and the total value of each sale is based. See id., at 17 and 
20.
---------------------------------------------------------------------------

    \11\ The description of this document is business proprietary; 
for further discussion of this document, see Wireking's Section C 
Supp, at 14 and Wireking Analysis Memo.
---------------------------------------------------------------------------

    Wireking stated that it is not reporting the date of the 
commercial/shipment invoice issued to the U.S. customer as the date of 
sale because this is not when all the material terms of sale, i.e., 
final quantity and total value/payment of each sale, are fixed. See 
id., at 17. According to Wireking, the U.S. customer is not 
contractually obligated to purchase the quantity shipped by Wireking 
and thus Wireking's commercial/shipment invoice is a fair retail value 
of the merchandise but not a document establishing all material terms 
of sale. See id., at 17. Instead, Wireking stated that it has reported 
the date of document X issued by the U.S. customer as the date of sale 
because all the material terms of sale, i.e., final quantity, and total 
value and payment of the sale, were not finalized until this document 
was issued by the U.S. customer. Moreover, Wireking has reported that 
it does not record the commercial/shipment invoice issued to the U.S. 
customer in its accounting records. See id., at 14. Wireking has 
reported that it records the date of document X in its accounting 
records, as well as the payment received pursuant to the sale.\12\ 
Accordingly, based on the record evidence, the Department preliminarily 
determines that Wireking's date of sale is the date on which document X 
is issued because all the material terms of sale, i.e., final quantity, 
value, and payment, are not fixed until the U.S. customer issues 
document X to Wireking. Therefore, the Department will calculate 
Wireking's price for its U.S. sales using the date of document X as the 
date of sale.
---------------------------------------------------------------------------

    \12\ Although Wireking's affiliate, Company G, receives payment 
for the sale from the U.S. customer and records the date of sale of 
document X in its accounting records, because Wireking and Company G 
have been found to be a single entity (``Wireking''), the Department 
preliminarily determines that the single entity, Wireking, records 
document X as the date of sale in its accounting records. See 
Wireking's Section C Supp,
---------------------------------------------------------------------------

    However, based on the documents currently on the record of this 
proceeding, Wireking has not shown that it will be able to reconcile 
its total quantity of shipments to the total final quantity of 
merchandise purchased by the U.S. customer. See Wireking's February 18, 
2009, Letter, at 4. While Wireking reported that it will be able to 
support its reported U.S. sales by reconciling the reported U.S. 
quantity and value to document X, Wireking has stated that it will be 
unable to tie its total shipments to its total reported U.S. sales 
database quantity because Wireking does not have access to the U.S. 
customer's records, including inventory records, that establish whether 
Wireking's reported U.S. sales database is complete. The Department 
preliminarily finds that there is a difference between Wireking's 
reported total shipments to the U.S. customer during the POI and its 
total reported U.S. sales during the POI. See id., at 3; Wireking's 
Section C and D Response, (December 2, 2009), at Exhibit R1; Wireking 
Analysis Memo. Because Wireking has not shown that the reported total 
quantity and value of its U.S. sales is complete, i.e., there are 
unreported U.S. sales, we must conclude that the application of facts 
otherwise available is warranted for Wireking's unreported sales, 
pursuant to section 776(a)(2)(D) of the Act because Wireking is unable 
to reconcile the reported total quantity of sales to a verifiable 
source document. Because Wireking has claimed that it has provided all 
the information it can regarding the unusual sales arrangement with the 
U.S. customer, where the U.S. customer dictates the final quantity and 
value of the sale, and the Department currently has no information on 
the record to the contrary, the Department preliminarily determines 
that the application of AFA is not warranted, pursuant to section 
776(b) of the Act. Accordingly, as FA, the Department preliminarily 
determines that it will apply the weighted-average margin of Wireking's 
reported U.S. sales to the unreported quantity and value\13\ of 
Wireking's unreported sales. Furthermore, after the preliminary 
determination, the Department intends to issue additional supplemental 
questionnaires to Wireking to determine whether Wireking's reported 
quantity and value can be verified. The Department notes that all 
information relied upon must be verifiable. See Final

[[Page 9598]]

Determination of Sales at Less Than Fair Value and Affirmative 
Determination of Critical Circumstances: Small Diameter Graphite 
Electrodes from the People's Republic of China, 74 FR 2049 (January 14, 
2009) and accompanying Issues and Decision Memorandum at Comment 1. 
Therefore, based on these supplemental responses, the Department will 
make a determination as to whether Wireking's reported U.S. sales are 
verifiable.
---------------------------------------------------------------------------

    \13\ Because the Department has used the total shipments/
purchases to Company G as Wireking's total shipments to the U.S. 
customer during the POI and Wireking has reported that there is a 
difference in the total value of these shipment/purchases to the 
total value of Wireking's shipments to the U.S. customer, the 
Department has increased the total value by this difference. See 
Wireking's Section C Supp, at 17, for further discussion of this 
difference, which is business proprietary information. See also 
Wireking's Analysis Memo
---------------------------------------------------------------------------

Fair Value Comparison

    To determine whether sales of certain kitchen appliance shelving 
and racks to the United States by Wireking and New King Shan were made 
at less than fair value, we compared CEP to NV, as described in the 
``U.S. Price'' and ``Normal Value'' sections of this notice.

U.S. Price

    In accordance with section 772(b) of the Act, we based the U.S. 
price for New King Shan's sales on CEP because these sales were made by 
New King Shan's U.S. affiliate, which purchased the merchandise under 
investigation produced and sold by New King Shan through two other 
affiliates,\14\ Company A and Company B.\15\ In accordance with section 
772(c)(2)(A) of the Act, we calculated CEP by deducting, where 
applicable, the following expenses from the gross unit price charged to 
the first unaffiliated customer in the United States, foreign movement 
expenses, and U.S. movement expenses, including U.S. duties, U.S. 
warehousing, and inventory carrying cost. Further, in accordance with 
section 772(d)(1) of the Act and 19 CFR 351.402(b), where appropriate, 
we deducted from the starting price the following selling expenses 
associated with economic activities occurring in the United States: 
credit expenses and other direct selling expenses. In addition, 
pursuant to section 772(d)(3) of the Act, we made an adjustment to the 
starting price for CEP profit. We based movement expenses on either 
surrogate values or actual expenses. For details regarding our CEP 
calculations, and for a complete discussion of the calculation of the 
U.S. price for New King Shan, see New King Shan Analysis Memo.\16\
---------------------------------------------------------------------------

    \14\ The identity of these companies is business proprietary; 
for further discussion of these companies, see New King Shan 
Analysis Memo.
    \15\ New King Shan reported these sales as CEP sales. The 
Department finds that these sales are CEP sales because New King 
Shan reported that its affiliate in the United States performed 
sales functions such as: sales negotiation, issuance of invoices and 
receipt of payment from the ultimate U.S. customer during the POI. 
Moreover, New King Shan reported expenses incurred in the United 
States that are normally deducted from the gross unit price. See New 
King Shan's Section C Questionnaire Response, (January 12, 2009); 
see also Glycine From the People's Republic of China: Preliminary 
Results of Antidumping Duty Administrative Review and Preliminary 
Rescission, in Part, 72 FR 18457 (April 12, 2007) unchanged in 
Glycine from the People's Republic of China: Final Results of 
Antidumping Duty Administrative Review and Final Rescission, In 
Part, 72 FR 58809 (October 17, 2007) (where the Department stated 
that ``we based U.S. price for certain sales on CEP in accordance 
with section 772(b) of the Act, because sales were made by Nantong 
Donchang's U.S. affiliate, Wavort, Inc. {``Wavort''{time}  to 
unaffiliated purchasers.''); AK Steel Corp., et al v. United States, 
226 F.3d 1361, 1367 (Fed.Cir. 2000) (where the court stated that 
``the purpose of these additional deductions in the CEP methodology 
is to prevent foreign producers from competing unfairly in the U.S. 
market by inflating the U.S. price with amounts spent by the U.S. 
affiliate on marketing and selling the products in the United 
States'').
    \16\ The identity of this company is business proprietary 
information; for further discussion of this company, see Memorandum 
to Catherine Bertrand, Program Manager, AD/CVD Operations, Office 9, 
from Katie Marksberry, Case Analyst, AD/CVD Operations, Office 9: 
Preliminary Determination in the Antidumping Duty Investigation of 
Certain Kitchen Appliance Shelving and Racks from the People's 
Republic of China: Analysis Memorandum of New King Shan, (February 
26, 2008) (``New King Shan Memo'').
---------------------------------------------------------------------------

    Additionally, in accordance with section 772(b) of the Act, we 
based the U.S. price for Wireking's sales on CEP because these sales 
were sold (or agreed to be sold) after the date of importation into the 
United States by Wireking. In accordance with section 772(c)(2)(A) of 
the Act, we calculated CEP by deducting, where applicable, the 
following expenses from the gross unit price charged to the first 
unaffiliated customer in the United States, foreign movement expenses, 
and U.S. movement expenses, including U.S. inland freight from port to 
warehouse, U.S. inland insurance, U.S. duties, and inventory carrying 
cost. Additionally, in accordance with section 772(d)(1) of the Act and 
19 CFR 351.402(b), where appropriate, we deducted from the starting 
price the following selling expenses associated with economic 
activities occurring in the United States: credit expenses. We have 
based Wireking's imputed credit expenses on the difference between the 
date of shipment, which is when the merchandise was withdrawn from the 
U.S. warehouse, and the date that Wireking received payment. See 
Certain Hot-Rolled Carbon Steel Flat Products from India: Notice of 
Final Results of Antidumping Duty Administrative Review, 73 FR 31961 
(June 5, 2008) and accompanying Issues and Decision Memorandum at 
Comment 23. Moreover, pursuant to section 772(d)(3) of the Act, we made 
an adjustment to the starting price for CEP profit. For discussion of 
our valuation of Wireking's movement expenses, see the section of this 
notice entitled ``Use of AFA for Wireking's Movement Expenses.'' For a 
complete discussion of the calculation of the U.S. price for Wireking, 
see Wireking Analysis Memo.

Use of AFA for Wireking's Movement Expenses

    In this investigation, Wireking reported that it incurred certain 
freight expenses for sales made under sales term X and sales term Y 
\17\ that were purchased from a market economy carrier and paid for in 
market economy currency. See Wireking's Section C Supp, at 29-30 and 
Exhibit 17 at pages 26-33. However, for these freight expenses, after 
twice being requested by the Department to report these as market 
economy purchases, Wireking continued to report these freight expenses 
as non-market economy purchases because the market economy carrier has 
a PRC branch office that arranged these shipments. See id., at 30. 
Because it is the Department's practice to treat expenses purchased 
from a market economy supplier and paid for in a market economy 
currency as market economy purchases, and there is record evidence 
showing that Wireking was charged and paid the market economy supplier 
of these expenses in market economy currency under sales term X, the 
Department preliminarily determines to value these expenses as market 
economy purchases under sales term X. See 19 CFR 351.408(c)(1); Certain 
Pneumatic Off-the-Road Tires from the People's Republic of China: Final 
Affirmative Determination of Sales at Less Than Fair Value and Partial 
Affirmative Determination of Critical Circumstances, 73 FR 40485 (July 
15, 2008) and accompanying Issues and Decision Memorandum at Comment 
35. However, for freight expenses incurred under sales term Y, the 
Department preliminarily determines to value these expenses as non-
market economy purchases because there is record evidence showing that 
Wireking paid the market economy supplier of these expenses in non-
market economy currency. See Wireking's Section C Supp, at Exhibit 17 
at pages 19-25.
---------------------------------------------------------------------------

    \17\ The details of sales term X and sales term Y are business 
proprietary; for further discussion of sales term X and sales term 
Y, see Wire King Analysis Memo.
---------------------------------------------------------------------------

    Because Wireking was twice requested by the Department to report 
the price of its market economy freight expenses but failed to provide 
such information after being requested, the Department preliminarily 
determines that the application of facts otherwise available to 
Wireking's market economy

[[Page 9599]]

freight expenses incurred under sales term X is warranted, pursuant to 
sections 776(a)(2)(A) and (B) of the Act. Where the Department 
determines that a response to a request for information does not comply 
with the request, section 782(d) of the Act provides that the 
Department shall promptly inform the party submitting the response of 
the nature of the deficiency and shall, to the extent practicable, 
provide that party with an opportunity to remedy or explain the 
deficiency. After receipt of Wireking's response to Section C of the 
Department's initial questionnaire, which clearly directed Wireking to 
report the market economy price of any freight expense that it incurred 
using a market economy carrier and paid for in market economy currency, 
the Department issued Wireking a supplemental Section C questionnaire. 
This supplemental Section C questionnaire granted Wireking an 
additional opportunity to report the price of its market economy 
freight expenses. See the Department's Supplemental Section C 
Questionnaire to Wireking (January 28, 2009) at Questions 44, 46, 50, 
51, and 56. However, Wireking refused to comply with the Department's 
request and instead argued that it was appropriate to treat this market 
economy carrier as an ``NME service provider'' and did not provide the 
requested information. See Wireking's Section C Supp, at 30. 
Accordingly, section 782(d) of the Act does not prevent application of 
partial AFA under these circumstances. See Reiner Brach GmbH & Co. KG 
v. United States, 206 F. Supp. 2d 1323, 1332-38 (CIT 2002).
    For these reasons, the Department has preliminarily determined to 
apply partial AFA to Wireking's market economy freight expenses 
incurred under sales term X, as specified under sections 776(a)(2)(A) 
and (B) of the Act. As stated above, Wireking had multiple 
opportunities to report the price of these market economy freight 
expenses to the Department. Despite Wireking's categorization of these 
freight expenses as non-market economy purchases, the Department's 
request for this information was unambiguous. Therefore, for the 
reasons stated above, the Department finds that, pursuant to section 
776(b) of the Act, Wireking has failed to cooperate to the best of its 
ability with regard to its unreported market economy freight expenses 
incurred under sales term X. Because Wireking failed to fully cooperate 
with the Department in this matter, we find it appropriate to use an 
inference that is adverse to the interests of Wireking in selecting 
from among the facts otherwise available. See section 776(b) of the 
Act. By doing so, we ensure that Wireking will not obtain a more 
favorable result by failing to cooperate than had it cooperated fully 
in this inve