Certain Preserved Mushrooms From the People's Republic of China: Preliminary Results of Antidumping Duty New Shipper Review, 50946-50952 [E9-23833]

Download as PDF 50946 Notices Federal Register Vol. 74, No. 190 Friday, October 2, 2009 This section of the FEDERAL REGISTER contains documents other than rules or proposed rules that are applicable to the public. Notices of hearings and investigations, committee meetings, agency decisions and rulings, delegations of authority, filing of petitions and applications and agency statements of organization and functions are examples of documents appearing in this section. COMMISSION ON CIVIL RIGHTS pwalker on DSK8KYBLC1PROD with NOTICES Agenda and Notice of Public Meeting of the Arkansas Advisory Committee Notice is hereby given, pursuant to the provisions of the rules and regulations of the U.S. Commission on Civil Rights (Commission), and the Federal Advisory Committee Act (FACA), that a planning meeting of the Arkansas Advisory Committee to the Commission will convene by conference call at 2:30 p.m. and adjourn at approximately 3:30 p.m. on Thursday, October 29, 2009. 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The address is U.S. Commission on Civil Rights, 400 State Avenue, Suite 908, Kansas City, Kansas 66101. Comments may be e-mailed to frobinson@usccr.gov. Records generated by this meeting may be inspected and reproduced at the Central Regional Office, as they become available, both before and after the meeting. Persons interested in the work of this advisory committee are advised to go to the Commission’s Web site, http:// www.usccr.gov, or to contact the Central Regional Office at the above e-mail or street address. The meeting will be conducted pursuant to the provisions of the rules and regulations of the Commission and FACA. Peter Minarik, Acting Chief, Regional Programs Coordination Unit. [FR Doc. E9–23801 Filed 10–1–09; 8:45 am] BILLING CODE 6335–01–P DEPARTMENT OF COMMERCE International Trade Administration [A–570–851] Certain Preserved Mushrooms From the People’s Republic of China: Preliminary Results of Antidumping Duty New Shipper Review AGENCY: Import Administration, International Trade Administration, Department of Commerce. DATES: Effective Date: October 2, 2009. SUMMARY: The Department of Commerce (the Department) is currently conducting a new shipper review of the antidumping duty order on certain preserved mushrooms from the People’s Republic of China (PRC) covering the period February 1, 2008, through January 31, 2009. We preliminarily determine that the sale made by Linyi City Kangfa Foodstuff Drinkable Co., Ltd. (Kangfa), and its affiliated supplier Linyi City Kangfa Foodstuff Drinkable Co., Ltd., Pingyi Branch (Pingyi Branch) E:\FR\FM\02OCN1.SGM 02OCN1 Federal Register / Vol. 74, No. 190 / Friday, October 2, 2009 / Notices (collectively ‘‘Kangfa’’), was not made below normal value (NV). If these preliminary results are adopted in our final results of review, we will instruct U.S. Customs and Border Protection (CBP) to liquidate entries of merchandise exported by Kangfa during the POR without regard to antidumping duties. FOR FURTHER INFORMATION CONTACT: Fred Baker or Robert James, AD/CVD Operations, Office 7, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482–2924 or (202) 482– 0649, respectively. SUPPLEMENTARY INFORMATION: pwalker on DSK8KYBLC1PROD with NOTICES Background On February 19, 1999, the Department published in the Federal Register an amended final determination and antidumping duty order on certain preserved mushrooms from the PRC. See Notice of Amendment of Final Determination of Sales at Less than Fair Value and Antidumping Duty Order: Certain Preserved Mushrooms from the People’s Republic of China, 64 FR 8308 (February 19, 1999) (Order). On February 26, 2009, we received a timely new shipper review request in accordance with section 751(a)(2)(B) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.214(c), from exporter and producer Kangfa. The Department determined that this request contained certain deficiencies, and requested that Kangfa correct the submission. See March 12, 2009, and March 20, 2009, letters from Robert James, Program Manager, to Kangfa. In accordance with the Department’s requests, Kangfa corrected the deficiencies in its submission dated March 26, 2009. On April 7, 2009, the Department published a notice in the Federal Register initiating a new shipper review for Kangfa. See Certain Preserved Mushrooms from the People’s Republic of China: Notice of Initiation of Antidumping Duty New Shipper Review, 74 FR 15698 (April 7, 2009) (Initiation Notice). We issued the standard antidumping duty questionnaire, along with the standard importer questionnaire for new shipper reviews, on April 3, 2009, and received responses in May and June 2009. We issued supplemental questionnaires covering sections A, C, and D of the original questionnaire on May 22, 2009, June 19, 2009, July 20, 2009, and August 10, 2009, and received timely responses to those questionnaires. VerDate Nov<24>2008 16:40 Oct 01, 2009 Jkt 220001 Period of Review The POR covers February 1, 2008, through January 31, 2009. Scope of the Order The products covered by this order are certain preserved mushrooms, whether imported whole, sliced, diced, or as stems and pieces. The certain preserved mushrooms covered under this order are the species Agaricus bisporus and Agaricus bitorquis. ‘‘Certain Preserved Mushrooms’’ refers to mushrooms that have been prepared or preserved by cleaning, blanching, and sometimes slicing or cutting. These mushrooms are then packed and heated in containers including, but not limited to, cans or glass jars in a suitable liquid medium, including, but not limited to, water, brine, butter or butter sauce. Certain preserved mushrooms may be imported whole, sliced, diced, or as stems and pieces. Included within the scope of this order are ‘‘brined’’ mushrooms, which are presalted and packed in a heavy salt solution to provisionally preserve them for further processing.1 Excluded from the scope of this order are the following: (1) All other species of mushroom, including straw mushrooms; (2) all fresh and chilled mushrooms, including ‘‘refrigerated’’ or ‘‘quick blanched mushrooms’’ (3) dried mushrooms; (4) frozen mushrooms; and (5) ‘‘marinated,’’ ‘‘acidified,’’ or ‘‘pickled’’ mushrooms, which are prepared or preserved by means of vinegar or acetic acid, but may contain oil or other additives. The merchandise subject to this order is classifiable under subheadings: 2003.10.0127, 2003.10.0131, 2003.10.0137, 2003.10.0143, 2003.10.0147, 2003.10.0153 and 0711.51.0000 of the Harmonized Tariff Schedule of the United States (HTSUS). Although the HTSUS subheadings are provided for convenience and Customs purposes, the written description of the scope of this order is dispositive. Bona Fide Analysis Consistent with the Department’s practice, we investigated the bona fide nature of the sale made by Kangfa for 1 On June 19, 2000, the Department affirmed that ‘‘marinated,’’ ‘‘acidified,’’ or ‘‘pickled’’ mushrooms containing less than 0.5 percent acetic acid are within the scope of the antidumping duty order. See Recommendation Memorandum-Final Ruling of Request by Tak Fat, et al. for Exclusion of Certain Marinated, Acidified Mushrooms from the Scope of the Antidumping Duty Order on Certain Preserved Mushrooms from the People’s Republic of China,’’ dated June 19, 2000. On February 9, 2005, the United States Court of Appeals for the Federal Circuit upheld this decision. See Tak Fat v. United States, 396 F.3d 1378 (Fed. Cir. 2005). PO 00000 Frm 00002 Fmt 4703 Sfmt 4703 50947 this new shipper review. In evaluating whether a single sale in a new shipper review is commercially reasonable, and therefore bona fide, the Department considers, inter alia, such factors as: (1) The timing of the sale; (2) the price and quantity; (3) the expenses arising from the transaction; (4) whether the goods were resold at a profit; and (5) whether the transaction was made on an arm’slength basis. See Tianjin Tiancheng Pharm. Co., Ltd. v. United States, 366 F. Supp. 2d 1246, 1250 (CIT 2005). Accordingly, the Department considers a number of factors in its bona fide analysis, ‘‘all of which may speak to the commercial realities surrounding an alleged sale of subject merchandise.’’ See Hebei New Donghua Amino Acid Co., Ltd. v. United States, 374 F. Supp. 2d 1333, 1342 (CIT 2005) (citing Fresh Garlic From the People’s Republic of China: Final Results of Antidumping Administrative Review and Rescission of New Shipper Review, 67 FR 11283 (March 13, 2002) and accompanying Issues and Decision Memorandum). We preliminarily find the U.S. sale made by Kangfa during the POR was made on a bona fide basis. Specifically, we find: (1) The timing of the sale does not indicate the sale might not be bona fide; (2) the quantity of the sale was within the range of the quantities of other entries of subject merchandise from the PRC into the United States during the POR, based upon the Department’s review of data obtained from CBP; (3) Kangfa and its customer did not incur any extraordinary expenses arising from the transaction; (4) the sale was resold at a profit; and (5) the sale was made between unaffiliated parties at arm’s-length. However, we also note that the price of this sale was not within the range of other entries of subject merchandise during the POR. Nevertheless, we have determined that Kangfa’s selling price, alone, does not raise any concerns with respect to bona fides. For a complete review of our bona fides analysis, see Memorandum from Fred Baker, International Trade Compliance Analyst, to The File via Robert James, Program Manager, Office 7, ‘‘Bona Fide Sales Analysis of Linyi City Kangfa Foodstuff Drinkable Co., Ltd. (Kangfa), and Linyi City Kangfa Foodstuff Drinkable Co., Ltd., Pingyi Branch (Pingyi Branch) (collectively ‘Kangfa’) in the Antidumping Duty New Shipper Review of Certain Preserved Mushrooms from the People’s Republic of China,’’ dated concurrently with this notice. Based on our review of the record evidence concerning the bona fide nature of this sale, as well as Kangfa’s eligibility for a separate rate (see E:\FR\FM\02OCN1.SGM 02OCN1 50948 Federal Register / Vol. 74, No. 190 / Friday, October 2, 2009 / Notices ‘‘Separate Rates Determination’’ section, below) and the Department’s determination that Kangfa was not affiliated with any exporter or producer that had previously shipped subject merchandise to the United States, we preliminarily determine that Kangfa has met the requirements to qualify as a new shipper during the POR. Therefore, for purposes of these preliminary results, we are treating the sale of subject merchandise to the United States as an appropriate transaction for this new shipper review. Non-Market Economy Country Status In every case conducted by the Department involving the PRC, we have treated the PRC as a non-market economy (NME) country. 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. None of the parties to this proceeding have contested such treatment. Accordingly, we calculated NV in accordance with section 773(c) of the Act, which applies to NME countries. pwalker on DSK8KYBLC1PROD with NOTICES Separate Rates Determination 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 policy to assign all exporters of the merchandise subject to review in NME countries a single rate unless an exporter can affirmatively demonstrate an absence of government control, both in law (de jure) and in fact (de facto), with respect to exports. To establish whether a company 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). Absence of De Jure Control Evidence supporting, though not requiring, a finding of de jure absence of government control over export activities includes: (1) An absence of restrictive stipulations associated with the individual exporter’s business and VerDate Nov<24>2008 16:40 Oct 01, 2009 Jkt 220001 export licenses; (2) any legislative enactments decentralizing control of companies; and (3) any other formal measures by the government decentralizing control of companies. See Sparklers, 56 FR at 20589. In this new shipper review, Kangfa submitted a complete response to the separate rates section of the Department’s questionnaire. The evidence submitted in the instant review by Kangfa includes government laws and regulations on corporate ownership and control (i.e., the Company Law and the Foreign Trade Law of the People’s Republic of China), individual business licenses, and narrative information regarding the company’s operations and selection of management. The evidence Kangfa provided supports a preliminary finding of a de jure absence of government control over its export activities because: (1) There are no controls on exports of subject merchandise, such as quotas applied to, or licenses required for, exports of the subject merchandise to the United States; and (2) the government of the PRC has passed legislation decentralizing control of companies. See Kangfa’s March 24, 2009 submission at Appendix 2, and its April 22 submission at 4. Absence of De Facto Control The absence of de facto government control over exports generally is based on whether the respondent: (1) Sets its own export prices independent of the government and other exporters; (2) retains the proceeds from its export sales and makes independent decisions regarding the disposition of profits or financing of losses; (3) has the authority to negotiate and sign contracts and other agreements; and (4) has autonomy from the government regarding the selection of management. See Silicon Carbide, 59 FR at 22586–87; Sparklers, 56 FR at 20589; and 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). In its April 22, 2009, submission, Kangfa submitted evidence demonstrating an absence of de facto government control over its export activities. Specifically, this evidence indicates: (1) The company sets its own export prices independent of the government and without the approval of a government authority; (2) the company retains the proceeds from its sales and makes independent decisions regarding the disposition of profits or financing of losses; (3) the company has a general manager and a sales manager with the authority to negotiate and bind the company in an agreement; (4) the PO 00000 Frm 00003 Fmt 4703 Sfmt 4703 general manager is selected by the board of directors, and the general manager appoints the manager of each department; and (5) there is no restriction on the company’s use of export revenues. Therefore, in the absence of either de jure or de facto government control over Kangfa’s export activities, we preliminarily find that Kangfa has established prima facie that it qualifies for a separate rate under the criteria established by Silicon Carbide and Sparklers. Surrogate Country When the Department investigates imports from an NME country, section 773(c)(1) of the Act directs it to base NV, in most circumstances, on the NME producer’s factors of production (FOPs), 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 new shipper review are discussed under the ‘‘Normal Value’’ section, below. On May 13, 2009, the Department determined that India, the Philippines, Indonesia, Colombia, Thailand and Peru are countries comparable to the PRC in terms of economic development, and requested comments from interested parties on selecting the appropriate surrogate country for this review. See Letter to All Interested Parties, RE: New Shipper Review of Certain Preserved Mushrooms from the People’s Republic of China: Linyi City Kangfa Foodstuff Drinkable Co., Ltd., dated May 18, 2009, at Attachment 1. No party submitted surrogate country selection comments. The Department has examined the export levels 2 of subject merchandise from the above-mentioned countries and found that India and Indonesia are significant producers of comparable merchandise. See Memorandum from Fred Baker, International Trade Compliance Analyst, to Richard Weible, Office Director, ‘‘Antidumping Duty New Shipper Review of Certain Preserved Mushrooms from the People’s Republic of China: Selection of a 2 The Department was unable to find world production data for subject merchandise and relied on export data as a substitute for overall production. E:\FR\FM\02OCN1.SGM 02OCN1 Federal Register / Vol. 74, No. 190 / Friday, October 2, 2009 / Notices Surrogate Country,’’ dated concurrently with this notice (Surrogate Country Memorandum) at 4. During the POR India had exports in both of the HTS subheadings identified for subject merchandise, while Indonesia had exports under only one of the HTS subheadings. Accordingly, we find that the Indian export data are more comprehensive and representative of subject merchandise than Indonesian export data. Id. at 5. In selecting the appropriate surrogate country, the Department examines the availability and reliability of data from the countries deemed to be economically comparable and significant producers of subject merchandise. For a description of our practice, see Department Policy Bulletin No. 04.1: Non-Market Economy Surrogate Country Selection Process (March 1, 2004). India has been the primary surrogate country in numerous past segments for this proceeding. In those past segments, the Department found India’s import statistics to be an available and reliable source for surrogate values. See Surrogate Country Memorandum at 4. Therefore, because India: (1) Is a significant producer of comparable merchandise; (2) is at a similar level of economic development as the PRC; (3) has publicly available and reliable data, which the Department has previously relied upon for numerous segments of this proceeding; and, (4) has more comprehensive and more representative data regarding the subject merchandise than the data provided for Indonesia, the Department has selected India as the surrogate country, pursuant to section 773(c)(4) of the Act. See Surrogate Country Memorandum at 5. pwalker on DSK8KYBLC1PROD with NOTICES Fair Value Comparisons To determine whether Kangfa’s sale of subject merchandise to the United States was made at a price below NV, we compared its U.S. price to NV, as described in the ‘‘U.S. Price’’ and ‘‘Normal Value’’ sections of this notice, below. U.S. Price In its section A response Kangfa stated that it intended to use the invoice date as the date of sale, stating that this was the date that best represented when the terms of sale are fixed. See Kangfa’s April 22, 2009 section A submission at 14. Later, in its submission of June 3, 2009, Kangfa attempted to show that the terms of sale sometimes change after the contract date. Kangfa’s evidence consisted of a contract and invoice for a shipment of non-subject fruit it had made to the German market during the VerDate Nov<24>2008 16:40 Oct 01, 2009 Jkt 220001 POR which showed that the quantity invoiced to the customer differed from the quantity indicated on the contract. See Kangfa’s June 3, 2009, submission at 1 and Exhibit 1. However, we note that the quantity and price of its U.S. sale did not change from the contact date to the invoice date, and the change in quantity of non-subject fruit, which respondent relied upon to justify the use of invoice date, was within the tolerance level specified on the contract. Therefore, we do not consider this to be a change to the material terms of sale relevant for purposes of determining date of sale. Thus, we used the contract date as the date of sale because there were no changes to either the price or quantity of Kangfa’s U.S. sale after this date, and there is no record evidence that the material terms of sale changed following the contract date for any of Kangfa’s other sales during the POR. The contract date is therefore the date that best represents when Kangfa established the material terms of sale. See 19 CFR 351.401(i). In accordance with section 772(a) of the Act, we based U.S. price on the export price (EP) of the sale to the United States by Kangfa because the first sale to an unaffiliated party was made before the date of importation and the use of constructed export price was not otherwise warranted. We calculated EP based on the free-on-board (FOB) price to the first unaffiliated purchaser in the United States. For this EP sale, we deducted foreign inland freight and foreign brokerage and handling from the starting price (or gross unit price), in accordance with section 772(c) of the Act. For Kangfa’s U.S. sale, each of these services was provided by an NME vendor. Thus, we based the deduction of these movement charges on surrogate values. We valued truck freight expenses using a per-unit average rate calculated from data on the following Web site: http://www.infobanc.com/logistics/ logtruck.htm. The logistics section of this Web site contains inland freight truck rates between many large Indian cities. We used data from this Web site for six months of the POR for which the Web site contained data. See Memorandum from Fred Baker, International Trade Compliance Analyst, through Robert James, Program Manager, to the File, ‘‘New Shipper Review of Certain Preserved Mushrooms from the People’s Republic of China: Surrogate Values for the Preliminary Results’’ (Surrogate Values Memorandum) at Exhibit 6. We valued brokerage and handling using a simple average of the brokerage and handling costs reported in public PO 00000 Frm 00004 Fmt 4703 Sfmt 4703 50949 submissions filed in three antidumping duty cases. Specifically, we averaged the public brokerage and handling expenses reported by Navneet Publications (India) Ltd. in the 2007– 2008 administrative review of certain lined paper products from India, Essar Steel Limited in the 2006–2007 antidumping duty administrative review of hot-rolled carbon steel flat products from India, and Himalaya International Ltd. in the 2005–2006 administrative review of certain preserved mushrooms from India. The Department adjusted the average brokerage and handling rate for inflation. See Surrogate Value Memorandum at Exhibit 8. Normal Value 1. Methodology Section 773(c)(1)(B) of the Act provides that the Department shall determine the NV using an FOP methodology if the merchandise is exported from an NME and the information does not permit the calculation of NV using home-market prices, third-country prices, or constructed value under section 773(a) of the Act. The Department bases NV on FOPs because the presence of government controls on various aspects of NMEs 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). We calculated NV by adding together the value of the FOPs, general expenses, profit, and packing costs. The FOPs for subject merchandise include: (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 FOPs that Kangfa reported for materials, energy, labor, and packing, and valued those FOPs by multiplying the amount of the factor consumed in producing subject merchandise by the average unit surrogate value of the factor. In addition, we added freight costs to the surrogate costs that we calculated for material inputs. We calculated E:\FR\FM\02OCN1.SGM 02OCN1 50950 Federal Register / Vol. 74, No. 190 / Friday, October 2, 2009 / Notices freight costs by multiplying surrogate freight rates by the shorter of the reported distance from the domestic supplier to the factory that produced the subject merchandise or the distance from the nearest seaport to the factory that produced the subject merchandise, as appropriate. Where there were multiple domestic suppliers of a material input, we calculated a weighted-average distance after limiting each supplier’s distance to no more than the distance from the nearest seaport to Kangfa. This adjustment is in accordance with the decision by the Court of Appeals for the Federal Circuit in Sigma Corp. v. United States, 117 F.3d 1401, 1407–1408 (Fed. Cir. 1997). We offset Kangfa’s material costs for revenue generated from the sale of copper wire scrap and tin scrap. See Surrogate Values Memorandum at Exhibit 8. We also increased the calculated costs of the FOPs for surrogate general expenses and profit. See Surrogate Values Memorandum at Exhibit 9. pwalker on DSK8KYBLC1PROD with NOTICES 2. Selection of Surrogate Values In selecting surrogate values, we followed, to the extent practicable, the Department’s practice of choosing public values which are non-export averages, representative of a range of prices in effect during the POR, or over a period as close as possible in time to the POR, product-specific, and taxexclusive. See, e.g., Notice of Preliminary Determination of Sales at Less Than Fair Value, Negative Preliminary Determination of Critical Circumstances and Postponement of Final Determination: Certain Frozen and Canned Warmwater Shrimp From the Socialist Republic of Vietnam, 69 FR 42672, 42682 (July 16, 2004), unchanged in Final Determination of Sales at Less Than Fair Value: Certain Frozen and Canned Warmwater Shrimp From the Socialist Republic of Vietnam, 69 FR 71005 (December 8, 2004). We also considered the quality of the source of surrogate information in selecting surrogate values. See Manganese Metal From the People’s Republic of China; Final Results and Partial Rescission of Antidumping Duty Administrative Review, 63 FR 12440 (March 13, 1998). Where we could obtain only surrogate values that were not contemporaneous with the POR, we inflated (or deflated) the surrogate values using, where appropriate, the Indian wholesale price index (WPI) as published in International Financial Statistics by the International Monetary Fund. See Surrogate Values Memorandum at Exhibit 1. VerDate Nov<24>2008 16:40 Oct 01, 2009 Jkt 220001 In calculating surrogate values from import statistics, in accordance with the Department’s practice, we disregarded statistics for imports from NME countries and countries deemed to maintain broadly available, nonindustry-specific subsidies which may benefit all exporters to all export markets (e.g., Indonesia, South Korea, and Thailand). See, e.g., Final Determination of Sales at Less Than Fair Value: Certain Automotive Replacement Glass Windshields From The People’s Republic of China, 67 FR 6482 (February 12, 2002) and accompanying Issues and Decision Memorandum at Comment 1. See also Notice of Preliminary Determination of Sales at Less Than Fair Value, Postponement of Final Determination, and Affirmative Preliminary Determination of Critical Circumstances: Certain Color Television Receivers From the People’s Republic of China, 68 FR 66800, 66808 (November 28, 2003), unchanged in Notice of Final Determination of Sales at Less Than Fair Value and Negative Final Determination of Critical Circumstances: Certain Color Television Receivers From the People’s Republic of China, 69 FR 20594 (April 16, 2004). Additionally, we excluded from our calculations imports that were labeled as originating from an unspecified country because we could not determine whether they were from an NME country. We valued production material inputs (mushroom spawn, wheat straw, and manure) using the financial statements of Agro Dutch, an Indian producer of mushrooms and vegetables, as follows. To value the input of mushroom spawn, we used data from Agro Dutch’s FY 2004–2005 (April 2004–March 2005) financial statement because Agro Dutch’s mushroom spawn value is specific to the species Agaricus bisporous, which is the species used to produce subject merchandise. To value the input of wheat straw, we used the wheat straw value from Agro Dutch’s FY 2006–2007 (April 2006–March 2007) financial statement because this value is specific to the input. To value the input of manure, we used the manure value from Agro Dutch’s FY 2004–2005 financial statement because this value is specific to the input. See Surrogate Values Memorandum at Exhibit 2. We adjusted these values for inflation. See Surrogate Values Memorandum at Exhibit 1. We valued processing and canning material inputs (super calcium phosphate, calcium carbonate, salt, citric acid, tin plate, copper wire, and sealing glue) using weighted-average PO 00000 Frm 00005 Fmt 4703 Sfmt 4703 Indian import values derived from the World Trade Atlas online (WTA), for the period February 2008 through January 2009. See Surrogate Values Memorandum at Exhibits 2 and 3. In addition, we valued packing material inputs (cartons, labels, hard paper board, and glue) with weighted-average Indian import values derived from the WTA for the period February 2008 through January 2009. Id. at Exhibit 5. The Indian import statistics obtained from the WTA were published by the Indian Directorate General of Commercial Intelligence and Statistics, Ministry of Commerce of India, and are contemporaneous with the POR. As the Indian surrogate values were denominated in rupees, in accordance with section 773A(a) of the Act, we converted them to U.S. dollars using the official exchange rate for India recorded on the date of sale of subject merchandise in this case. See http:// www.ia.ita.doc.gov/exchange/ index.html. To value land rent, the Department used data from the 2001 Punjab State Development Report, administered by the Planning Commission of the Government of India. Since the value of land rent was not contemporaneous with the POR, the Department adjusted the value for inflation. See Surrogate Values Memorandum at Exhibit 2. We valued electricity using price data for small, medium, and large industries, as published by the Central Electricity Authority of the Government of India in its publication titled Electricity Tariff & Duty and Average Rates of Electricity Supply in India, dated July 2006. These electricity rates represent actual country-wide publicly-available information on tax-exclusive electricity rates charged to industries in India. As the rates listed in this source became effective on a variety of different dates, we are not adjusting the average value for inflation. See Surrogate Value Memorandum at Exhibit 4. To value water, the Department used the revised Maharastra Industrial Development Corporation water rates, which are available at http:// www.midcindia.com/water-supply. The Department found this source to be the best available information since it includes a wide range of industrial water rates. Since the water rates were not contemporaneous with the POR, the Department adjusted the value for inflation. See Surrogate Values Memorandum at Exhibit 4. We valued coal using weightedaverage Indian import values derived from the WTA for the period February 2008 through January 2009. See E:\FR\FM\02OCN1.SGM 02OCN1 Federal Register / Vol. 74, No. 190 / Friday, October 2, 2009 / Notices Surrogate Values Memorandum at Exhibit 4. We valued truck freight expenses for inputs using the same surrogate data we used for valuing domestic inland freight for Kangfa’s U.S. sale (i.e., we used data from the Web site http:// www.infobanc.com/logistics/ logtruck.htm, which contains inland freight truck rates between many large Indian cities). See Surrogate Values Memorandum at Exhibit 6. The Department’s regulations require the use of a regression-based wage rate. See 19 CFR 351.408(c)(3). Therefore, to value labor, the Department used the regression-based wage rate for the PRC published on the Import Administration Web site. See the IA Web site: http:// ia.ita.doc.gov/wages/05wages/05wages041608.html, and see Corrected 2007 Calculation of Expected Non-Market Economy Wages, 73 FR 27795 (May 14, 2008). To value the surrogate financial ratios for factory overhead (OH), selling, general & administrative (SG&A) expenses, and profit, the Department used the 2006–2007 financial statements of Agro Dutch and Flex Foods Limited (Flex Foods). Agro Dutch is a producer of mushrooms, and Flex Foods is a producer of mushrooms and other vegetable products. Agro Dutch’s and Flex Foods’ financial ratios for OH and SG&A are comparable to Kangfa’s financial ratios because Agro Dutch’s and Flex Foods’ production experience is comparable to Kangfa’s production experience by virtue of each company’s production of subject merchandise. Moreover, an average of the financial statements of Agro Dutch and Flex Foods represents a broader spectrum of the Indian mushroom industry than does the financial statement of a single mushroom producer. See Surrogate Values Memorandum at Exhibit 9. pwalker on DSK8KYBLC1PROD with NOTICES Currency Conversion We made currency conversions into U.S. dollars, in accordance with section 773A(a) of the Act, based on the exchange rates in effect on the dates of the U.S. sales as certified by the Federal Reserve Bank. These exchange rates can be accessed at the Web site of Import Administration at http://ia.ita.doc.gov/ exchange/index.html. Preliminary Results of Review We preliminarily determine that the following dumping margin exists during the period February 1, 2008, through January 31, 2009: VerDate Nov<24>2008 16:40 Oct 01, 2009 Jkt 220001 Manufacturer/exporter Linyi City Kangfa Foodstuff Drinkable Co., Ltd. (Kangfa) Margin (percent) 0.00 Public Comment In accordance with 19 CFR 351.224(b), the Department will disclose to parties to this proceeding the calculations performed in reaching the preliminary results within five days of publication of these preliminary results. Interested parties may submit written comments (case briefs) within 30 days of publication of the preliminary results and rebuttal comments (rebuttal briefs) within five days after the time limit for filing case briefs. See 19 CFR 351.309(c)(1)(ii) and 351.309(d)(1). Pursuant to 19 CFR 351.309(d)(2), rebuttal briefs must be limited to issues raised in the case briefs. Parties who submit arguments are requested to submit with the case or rebuttal briefs: (1) A statement of the issue; (2) a brief summary of the argument; and (3) a table of authorities. Further, the Department requests that parties submitting written comments provide the Department with a diskette containing the public version of those comments. Any interested party may request a hearing within 30 days of publication of this notice. See 19 CFR 351.310(c). Interested parties who wish to request a hearing or to participate if one is requested, must submit a written request to the Assistant Secretary for Import Administration within 30 days of publication of this notice. Requests should contain: (1) The party’s name, address, and telephone number; (2) the number of participants; and (3) a list of issues to be discussed. See 19 CFR 351.310(c). Issues raised in the hearing will be limited to those raised in the briefs. Unless the deadline is extended pursuant to section 751(a)(2)(B)(iv) of the Act, the Department will issue the final results of this new shipper review, including the results of our analysis of the issues raised by the parties in their comments, within 90 days of publication of these preliminary results. Assessment Rates Upon issuing the final results of the review, 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 PO 00000 Frm 00006 Fmt 4703 Sfmt 4703 50951 assessment rates based on the ratio of the total amount of the dumping duties 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. However, 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, when imposed, will be effective upon publication of the final results of this new shipper review for all shipments of subject merchandise exported by Kangfa entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided by section 751(a)(2)(C) of the Act: (1) For subject merchandise manufactured and exported by Kangfa, the cash-deposit rate will be that established in the final results of this review; (2) for subject merchandise exported by Kangfa but not manufactured by Kangfa, the cash deposit rate will continue to be the PRCwide rate (i.e., 198.63 percent); and (3) for subject merchandise manufactured by Kangfa but exported by any other party, the cash deposit rate will be the rate applicable to the exporter. If the cash deposit rate calculated for Kangfa in the final results is zero or de minimis, a cash deposit will be not be required for entries of subject merchandise both produced and exported by Kangfa. These cash deposit requirements, when imposed, shall remain in effect until further notice. Notification to Importers This notice serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary’s presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties. This new shipper review and notice are in accordance with sections 751(a)(2)(B) and 777(i) of the Act and 19 CFR 351.214(i). E:\FR\FM\02OCN1.SGM 02OCN1 50952 Federal Register / Vol. 74, No. 190 / Friday, October 2, 2009 / Notices Dated: September 28, 2009. John M. Andersen, Acting Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations. [FR Doc. E9–23833 Filed 10–1–09; 8:45 am] BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE International Trade Administration [A–570–831] pwalker on DSK8KYBLC1PROD with NOTICES Fresh Garlic from the People’s Republic of China: Final Results and Final Rescission, In Part, of New Shipper Reviews AGENCY: Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce (Department) is conducting the new shipper reviews (NSRs) of the antidumping duty order on fresh garlic from the People’s Republic of China (PRC) covering the periods of review (PORs) of November 1, 2007 through April 30, 2008 and November 1, 2007 through June 9, 2008.1 As discussed below, we determine that sales have been made in the United States at prices below normal value (NV) with respect to two exporters who participated fully and have demonstrated their eligibility for separate rates in the NSR: Chengwu County Yuanxiang Industry & Commerce, Ltd. (Yuanxiang) and Jinxiang Hejia Co., Ltd. (Hejia). In the preliminary results of this review, we found Yuanxiang’s and Hejia’s POR sales were made on a bona fide basis. See Fresh Garlic From the People’s Republic of China: Preliminary Results of New Shipper Reviews, 74 FR 20452 (May 4, 2009) (Preliminary Results). We are continuing to find Yuanxiang’s and Hejia’s sales to be bona fide for the final results of this review. In addition, we are rescinding the NSRs for four companies: Weifang Chenglong Import & Export Co., Ltd. (Chenglong), Jinxiang Tianheng Trade Co., Ltd. (Tianheng), Jinxiang Zhengyang Import & Export Co., Ltd. (Zhengyang), and Juye Homestead Fruits and Vegetables Co., Ltd. (Juye). We intend to instruct U.S. Customs and Border Protection (CBP) to assess antidumping duties on entries of subject merchandise during the POR for which importer–specific assessment rates are above de minimis. EFFECTIVE DATE: October 2, 2009. 1 We extended the end of the period of review (POR) from April 30, 2007 to June 9, 2008, to capture entries for three respondents. See the ‘‘Expansion of the POR’’ section in the Preliminary Results. VerDate Nov<24>2008 16:40 Oct 01, 2009 Jkt 220001 FOR FURTHER INFORMATION CONTACT: Toni Page, Scott Lindsay, or Summer Avery, AD/CVD Operations, Office 6, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482–1398, (202) 482– 0780, or (202) 482–4052, respectively. SUPPLEMENTARY INFORMATION: Background On May 4, 2009, the Department published in the Federal Register the preliminary results of the NSRs of the antidumping duty order on fresh garlic from the PRC. See Preliminary Results. Since the Preliminary Results, the following events have occurred. Hejia filed surrogate value (SV) information for its single–clove garlic on May 19, 2009. On May 22, 2009, we extended the deadline for all interested parties to submit publicly available information to value factors of production until June 9, 2009. Chenglong and Tianheng filed SV information on June 9, 2009. On June 19, 2009, Fresh Garlic Producers Association (FGPA) and its individual members (Christopher Ranch L.L.C., the Garlic Company, Valley Garlic, and Vessey and Company, Inc.) (collectively, Petitioners), filed factual information intended to rebut SV information filed by Chenglong and Tianheng. On May 27, 2009, the Department issued a supplemental questionnaire to Shandong Zhengyang with a due date of June 10, 2009. On June 4, 2009, counsel for Zhengyang notified the Department that it was withdrawing its representation of the company and advised the Department to contact Zhengyang directly. On June 12, 2009, the Department sent a letter to Zhengyang stating that we had not received its supplemental questionnaire response and that we had canceled verification. Zhengyang did not respond to the Department’s letter. On May 27, 2009, the Department sent a supplemental questionnaire to Hejia. The Department received Hejia’s timely response on June 2, 2009. On June 2, 2009, the Department was notified by Juye that it was withdrawing from the NSR. On June 4, 2009, we extended the time limit for the completion of the final results of these reviews. See Fresh Garlic From the People’s Republic of China: Extension of Time Limit for the Final Results of New Shipper Reviews, 74 FR 26839 (June 4, 2009). The Department conducted verification of the NSR respondents Chenglong, Hejia, and Yuanxiang from June 22, 2009 through June 30, 2009. On PO 00000 Frm 00007 Fmt 4703 Sfmt 4703 July 30 and 31, 2009, the Department issued its verification reports. On July 30, 2009, the Department preliminarily found Tianheng’s sale to be not bona fide. See Memorandum From Barbara E. Tillman, Office Director, Office 6, Re: Bona Fide Nature of the Sale in the Antidumping Duty New Shipper Review of Fresh Garlic from the People’s Republic of China (‘‘PRC’’): Amended Intent to Preliminarily Rescind Jinxiang Tianheng Trade Co.’s New Shipper Review, July 30, 2009 (Amended Memorandum). We continue to find Tianheng’s sale to be not bona fide for these final results. In response to requests filed by Petitioners and the NSR respondents, the Department extended the due date for case briefs until August 17, 2009. The Department received timely filed case briefs from Petitioners, Hejia, Yuanxiang, Chenglong, and Tianheng. On August 21, 2009, the Department advised Hejia and Tianheng that each company’s brief contained new factual information and instructed both Hejia and Tianheng to re–file their case briefs. Hejia and Tianheng complied with the Department’s request and re–filed their case briefs on August 28, 2009 and September 9, 2009, respectively. In response to requests filed by Petitioners and the NSR respondents, the Department extended the deadline for rebuttal briefs to August 24, 2009, for arguments regarding everything except Hejia–related issues, and to August 28, 2009, for Hejia–specific matters. The Department received timely filed rebuttal briefs from all interested parties on August 24 and 28, 2009. Scope of the Order The products covered by this Order are all grades of garlic, whole or separated into constituent cloves, whether or not peeled, fresh, chilled, frozen, provisionally preserved, or packed in water or other neutral substance, but not prepared or preserved by the addition of other ingredients or heat processing. The differences between grades are based on color, size, sheathing, and level of decay. The scope of this order does not include the following: (a) garlic that has been mechanically harvested and that is primarily, but not exclusively, destined for non–fresh use; or (b) garlic that has been specially prepared and cultivated prior to planting and then harvested and otherwise prepared for use as seed. The subject merchandise is used principally as a food product and for seasoning. The subject garlic is currently classifiable under subheadings 0703.20.0010, 0703.20.0020, 0703.20.0090, E:\FR\FM\02OCN1.SGM 02OCN1

Agencies

[Federal Register Volume 74, Number 190 (Friday, October 2, 2009)]
[Notices]
[Pages 50946-50952]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-23833]


=======================================================================
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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-851]


Certain Preserved Mushrooms From the People's Republic of China: 
Preliminary Results of Antidumping Duty New Shipper Review

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

DATES: Effective Date: October 2, 2009.

SUMMARY: The Department of Commerce (the Department) is currently 
conducting a new shipper review of the antidumping duty order on 
certain preserved mushrooms from the People's Republic of China (PRC) 
covering the period February 1, 2008, through January 31, 2009. We 
preliminarily determine that the sale made by Linyi City Kangfa 
Foodstuff Drinkable Co., Ltd. (Kangfa), and its affiliated supplier 
Linyi City Kangfa Foodstuff Drinkable Co., Ltd., Pingyi Branch (Pingyi 
Branch)

[[Page 50947]]

(collectively ``Kangfa''), was not made below normal value (NV). If 
these preliminary results are adopted in our final results of review, 
we will instruct U.S. Customs and Border Protection (CBP) to liquidate 
entries of merchandise exported by Kangfa during the POR without regard 
to antidumping duties.

FOR FURTHER INFORMATION CONTACT: Fred Baker or Robert James, AD/CVD 
Operations, Office 7, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
2924 or (202) 482-0649, respectively.

SUPPLEMENTARY INFORMATION: 

Background

    On February 19, 1999, the Department published in the Federal 
Register an amended final determination and antidumping duty order on 
certain preserved mushrooms from the PRC. See Notice of Amendment of 
Final Determination of Sales at Less than Fair Value and Antidumping 
Duty Order: Certain Preserved Mushrooms from the People's Republic of 
China, 64 FR 8308 (February 19, 1999) (Order). On February 26, 2009, we 
received a timely new shipper review request in accordance with section 
751(a)(2)(B) of the Tariff Act of 1930, as amended (the Act), and 19 
CFR 351.214(c), from exporter and producer Kangfa. The Department 
determined that this request contained certain deficiencies, and 
requested that Kangfa correct the submission. See March 12, 2009, and 
March 20, 2009, letters from Robert James, Program Manager, to Kangfa. 
In accordance with the Department's requests, Kangfa corrected the 
deficiencies in its submission dated March 26, 2009. On April 7, 2009, 
the Department published a notice in the Federal Register initiating a 
new shipper review for Kangfa. See Certain Preserved Mushrooms from the 
People's Republic of China: Notice of Initiation of Antidumping Duty 
New Shipper Review, 74 FR 15698 (April 7, 2009) (Initiation Notice).
    We issued the standard antidumping duty questionnaire, along with 
the standard importer questionnaire for new shipper reviews, on April 
3, 2009, and received responses in May and June 2009. We issued 
supplemental questionnaires covering sections A, C, and D of the 
original questionnaire on May 22, 2009, June 19, 2009, July 20, 2009, 
and August 10, 2009, and received timely responses to those 
questionnaires.

Period of Review

    The POR covers February 1, 2008, through January 31, 2009.

Scope of the Order

    The products covered by this order are certain preserved mushrooms, 
whether imported whole, sliced, diced, or as stems and pieces. The 
certain preserved mushrooms covered under this order are the species 
Agaricus bisporus and Agaricus bitorquis. ``Certain Preserved 
Mushrooms'' refers to mushrooms that have been prepared or preserved by 
cleaning, blanching, and sometimes slicing or cutting. These mushrooms 
are then packed and heated in containers including, but not limited to, 
cans or glass jars in a suitable liquid medium, including, but not 
limited to, water, brine, butter or butter sauce. Certain preserved 
mushrooms may be imported whole, sliced, diced, or as stems and pieces. 
Included within the scope of this order are ``brined'' mushrooms, which 
are presalted and packed in a heavy salt solution to provisionally 
preserve them for further processing.\1\
---------------------------------------------------------------------------

    \1\ On June 19, 2000, the Department affirmed that 
``marinated,'' ``acidified,'' or ``pickled'' mushrooms containing 
less than 0.5 percent acetic acid are within the scope of the 
antidumping duty order. See Recommendation Memorandum-Final Ruling 
of Request by Tak Fat, et al. for Exclusion of Certain Marinated, 
Acidified Mushrooms from the Scope of the Antidumping Duty Order on 
Certain Preserved Mushrooms from the People's Republic of China,'' 
dated June 19, 2000. On February 9, 2005, the United States Court of 
Appeals for the Federal Circuit upheld this decision. See Tak Fat v. 
United States, 396 F.3d 1378 (Fed. Cir. 2005).
---------------------------------------------------------------------------

    Excluded from the scope of this order are the following: (1) All 
other species of mushroom, including straw mushrooms; (2) all fresh and 
chilled mushrooms, including ``refrigerated'' or ``quick blanched 
mushrooms'' (3) dried mushrooms; (4) frozen mushrooms; and (5) 
``marinated,'' ``acidified,'' or ``pickled'' mushrooms, which are 
prepared or preserved by means of vinegar or acetic acid, but may 
contain oil or other additives.
    The merchandise subject to this order is classifiable under 
subheadings: 2003.10.0127, 2003.10.0131, 2003.10.0137, 2003.10.0143, 
2003.10.0147, 2003.10.0153 and 0711.51.0000 of the Harmonized Tariff 
Schedule of the United States (HTSUS). Although the HTSUS subheadings 
are provided for convenience and Customs purposes, the written 
description of the scope of this order is dispositive.

Bona Fide Analysis

    Consistent with the Department's practice, we investigated the bona 
fide nature of the sale made by Kangfa for this new shipper review. In 
evaluating whether a single sale in a new shipper review is 
commercially reasonable, and therefore bona fide, the Department 
considers, inter alia, such factors as: (1) The timing of the sale; (2) 
the price and quantity; (3) the expenses arising from the transaction; 
(4) whether the goods were resold at a profit; and (5) whether the 
transaction was made on an arm's-length basis. See Tianjin Tiancheng 
Pharm. Co., Ltd. v. United States, 366 F. Supp. 2d 1246, 1250 (CIT 
2005). Accordingly, the Department considers a number of factors in its 
bona fide analysis, ``all of which may speak to the commercial 
realities surrounding an alleged sale of subject merchandise.'' See 
Hebei New Donghua Amino Acid Co., Ltd. v. United States, 374 F. Supp. 
2d 1333, 1342 (CIT 2005) (citing Fresh Garlic From the People's 
Republic of China: Final Results of Antidumping Administrative Review 
and Rescission of New Shipper Review, 67 FR 11283 (March 13, 2002) and 
accompanying Issues and Decision Memorandum).
    We preliminarily find the U.S. sale made by Kangfa during the POR 
was made on a bona fide basis. Specifically, we find: (1) The timing of 
the sale does not indicate the sale might not be bona fide; (2) the 
quantity of the sale was within the range of the quantities of other 
entries of subject merchandise from the PRC into the United States 
during the POR, based upon the Department's review of data obtained 
from CBP; (3) Kangfa and its customer did not incur any extraordinary 
expenses arising from the transaction; (4) the sale was resold at a 
profit; and (5) the sale was made between unaffiliated parties at 
arm's-length. However, we also note that the price of this sale was not 
within the range of other entries of subject merchandise during the 
POR. Nevertheless, we have determined that Kangfa's selling price, 
alone, does not raise any concerns with respect to bona fides. For a 
complete review of our bona fides analysis, see Memorandum from Fred 
Baker, International Trade Compliance Analyst, to The File via Robert 
James, Program Manager, Office 7, ``Bona Fide Sales Analysis of Linyi 
City Kangfa Foodstuff Drinkable Co., Ltd. (Kangfa), and Linyi City 
Kangfa Foodstuff Drinkable Co., Ltd., Pingyi Branch (Pingyi Branch) 
(collectively `Kangfa') in the Antidumping Duty New Shipper Review of 
Certain Preserved Mushrooms from the People's Republic of China,'' 
dated concurrently with this notice.
    Based on our review of the record evidence concerning the bona fide 
nature of this sale, as well as Kangfa's eligibility for a separate 
rate (see

[[Page 50948]]

``Separate Rates Determination'' section, below) and the Department's 
determination that Kangfa was not affiliated with any exporter or 
producer that had previously shipped subject merchandise to the United 
States, we preliminarily determine that Kangfa has met the requirements 
to qualify as a new shipper during the POR. Therefore, for purposes of 
these preliminary results, we are treating the sale of subject 
merchandise to the United States as an appropriate transaction for this 
new shipper review.

Non-Market Economy Country Status

    In every case conducted by the Department involving the PRC, we 
have treated the PRC as a non-market economy (NME) country. 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. None of the parties to this 
proceeding have contested such treatment. Accordingly, we calculated NV 
in accordance with section 773(c) of the Act, which applies to NME 
countries.

Separate Rates Determination

    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 policy 
to assign all exporters of the merchandise subject to review in NME 
countries a single rate unless an exporter can affirmatively 
demonstrate an absence of government control, both in law (de jure) and 
in fact (de facto), with respect to exports. To establish whether a 
company 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).

Absence of De Jure Control

    Evidence supporting, though not requiring, a finding of de jure 
absence of government control over export activities includes: (1) An 
absence of restrictive stipulations associated with the individual 
exporter's business and export licenses; (2) any legislative enactments 
decentralizing control of companies; and (3) any other formal measures 
by the government decentralizing control of companies. See Sparklers, 
56 FR at 20589. In this new shipper review, Kangfa submitted a complete 
response to the separate rates section of the Department's 
questionnaire. The evidence submitted in the instant review by Kangfa 
includes government laws and regulations on corporate ownership and 
control (i.e., the Company Law and the Foreign Trade Law of the 
People's Republic of China), individual business licenses, and 
narrative information regarding the company's operations and selection 
of management. The evidence Kangfa provided supports a preliminary 
finding of a de jure absence of government control over its export 
activities because: (1) There are no controls on exports of subject 
merchandise, such as quotas applied to, or licenses required for, 
exports of the subject merchandise to the United States; and (2) the 
government of the PRC has passed legislation decentralizing control of 
companies. See Kangfa's March 24, 2009 submission at Appendix 2, and 
its April 22 submission at 4.

Absence of De Facto Control

    The absence of de facto government control over exports generally 
is based on whether the respondent: (1) Sets its own export prices 
independent of the government and other exporters; (2) retains the 
proceeds from its export sales and makes independent decisions 
regarding the disposition of profits or financing of losses; (3) has 
the authority to negotiate and sign contracts and other agreements; and 
(4) has autonomy from the government regarding the selection of 
management. See Silicon Carbide, 59 FR at 22586-87; Sparklers, 56 FR at 
20589; and 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).
    In its April 22, 2009, submission, Kangfa submitted evidence 
demonstrating an absence of de facto government control over its export 
activities. Specifically, this evidence indicates: (1) The company sets 
its own export prices independent of the government and without the 
approval of a government authority; (2) the company retains the 
proceeds from its sales and makes independent decisions regarding the 
disposition of profits or financing of losses; (3) the company has a 
general manager and a sales manager with the authority to negotiate and 
bind the company in an agreement; (4) the general manager is selected 
by the board of directors, and the general manager appoints the manager 
of each department; and (5) there is no restriction on the company's 
use of export revenues.
    Therefore, in the absence of either de jure or de facto government 
control over Kangfa's export activities, we preliminarily find that 
Kangfa has established prima facie that it qualifies for a separate 
rate under the criteria established by Silicon Carbide and Sparklers.

Surrogate Country

    When the Department investigates imports from an NME country, 
section 773(c)(1) of the Act directs it to base NV, in most 
circumstances, on the NME producer's factors of production (FOPs), 
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 new shipper review are discussed under the ``Normal 
Value'' section, below. On May 13, 2009, the Department determined that 
India, the Philippines, Indonesia, Colombia, Thailand and Peru are 
countries comparable to the PRC in terms of economic development, and 
requested comments from interested parties on selecting the appropriate 
surrogate country for this review. See Letter to All Interested 
Parties, RE: New Shipper Review of Certain Preserved Mushrooms from the 
People's Republic of China: Linyi City Kangfa Foodstuff Drinkable Co., 
Ltd., dated May 18, 2009, at Attachment 1. No party submitted surrogate 
country selection comments.
    The Department has examined the export levels \2\ of subject 
merchandise from the above-mentioned countries and found that India and 
Indonesia are significant producers of comparable merchandise. See 
Memorandum from Fred Baker, International Trade Compliance Analyst, to 
Richard Weible, Office Director, ``Antidumping Duty New Shipper Review 
of Certain Preserved Mushrooms from the People's Republic of China: 
Selection of a

[[Page 50949]]

Surrogate Country,'' dated concurrently with this notice (Surrogate 
Country Memorandum) at 4. During the POR India had exports in both of 
the HTS subheadings identified for subject merchandise, while Indonesia 
had exports under only one of the HTS subheadings. Accordingly, we find 
that the Indian export data are more comprehensive and representative 
of subject merchandise than Indonesian export data. Id. at 5.
---------------------------------------------------------------------------

    \2\ The Department was unable to find world production data for 
subject merchandise and relied on export data as a substitute for 
overall production.
---------------------------------------------------------------------------

    In selecting the appropriate surrogate country, the Department 
examines the availability and reliability of data from the countries 
deemed to be economically comparable and significant producers of 
subject merchandise. For a description of our practice, see Department 
Policy Bulletin No. 04.1: Non-Market Economy Surrogate Country 
Selection Process (March 1, 2004). India has been the primary surrogate 
country in numerous past segments for this proceeding. In those past 
segments, the Department found India's import statistics to be an 
available and reliable source for surrogate values. See Surrogate 
Country Memorandum at 4. Therefore, because India: (1) Is a significant 
producer of comparable merchandise; (2) is at a similar level of 
economic development as the PRC; (3) has publicly available and 
reliable data, which the Department has previously relied upon for 
numerous segments of this proceeding; and, (4) has more comprehensive 
and more representative data regarding the subject merchandise than the 
data provided for Indonesia, the Department has selected India as the 
surrogate country, pursuant to section 773(c)(4) of the Act. See 
Surrogate Country Memorandum at 5.

Fair Value Comparisons

    To determine whether Kangfa's sale of subject merchandise to the 
United States was made at a price below NV, we compared its U.S. price 
to NV, as described in the ``U.S. Price'' and ``Normal Value'' sections 
of this notice, below.

U.S. Price

    In its section A response Kangfa stated that it intended to use the 
invoice date as the date of sale, stating that this was the date that 
best represented when the terms of sale are fixed. See Kangfa's April 
22, 2009 section A submission at 14. Later, in its submission of June 
3, 2009, Kangfa attempted to show that the terms of sale sometimes 
change after the contract date. Kangfa's evidence consisted of a 
contract and invoice for a shipment of non-subject fruit it had made to 
the German market during the POR which showed that the quantity 
invoiced to the customer differed from the quantity indicated on the 
contract. See Kangfa's June 3, 2009, submission at 1 and Exhibit 1. 
However, we note that the quantity and price of its U.S. sale did not 
change from the contact date to the invoice date, and the change in 
quantity of non-subject fruit, which respondent relied upon to justify 
the use of invoice date, was within the tolerance level specified on 
the contract. Therefore, we do not consider this to be a change to the 
material terms of sale relevant for purposes of determining date of 
sale. Thus, we used the contract date as the date of sale because there 
were no changes to either the price or quantity of Kangfa's U.S. sale 
after this date, and there is no record evidence that the material 
terms of sale changed following the contract date for any of Kangfa's 
other sales during the POR. The contract date is therefore the date 
that best represents when Kangfa established the material terms of 
sale. See 19 CFR 351.401(i).
    In accordance with section 772(a) of the Act, we based U.S. price 
on the export price (EP) of the sale to the United States by Kangfa 
because the first sale to an unaffiliated party was made before the 
date of importation and the use of constructed export price was not 
otherwise warranted. We calculated EP based on the free-on-board (FOB) 
price to the first unaffiliated purchaser in the United States. For 
this EP sale, we deducted foreign inland freight and foreign brokerage 
and handling from the starting price (or gross unit price), in 
accordance with section 772(c) of the Act. For Kangfa's U.S. sale, each 
of these services was provided by an NME vendor. Thus, we based the 
deduction of these movement charges on surrogate values.
    We valued truck freight expenses using a per-unit average rate 
calculated from data on the following Web site: http://www.infobanc.com/logistics/logtruck.htm. The logistics section of this 
Web site contains inland freight truck rates between many large Indian 
cities. We used data from this Web site for six months of the POR for 
which the Web site contained data. See Memorandum from Fred Baker, 
International Trade Compliance Analyst, through Robert James, Program 
Manager, to the File, ``New Shipper Review of Certain Preserved 
Mushrooms from the People's Republic of China: Surrogate Values for the 
Preliminary Results'' (Surrogate Values Memorandum) at Exhibit 6.
    We valued brokerage and handling using a simple average of the 
brokerage and handling costs reported in public submissions filed in 
three antidumping duty cases. Specifically, we averaged the public 
brokerage and handling expenses reported by Navneet Publications 
(India) Ltd. in the 2007-2008 administrative review of certain lined 
paper products from India, Essar Steel Limited in the 2006-2007 
antidumping duty administrative review of hot-rolled carbon steel flat 
products from India, and Himalaya International Ltd. in the 2005-2006 
administrative review of certain preserved mushrooms from India. The 
Department adjusted the average brokerage and handling rate for 
inflation. See Surrogate Value Memorandum at Exhibit 8.

Normal Value

1. Methodology

    Section 773(c)(1)(B) of the Act provides that the Department shall 
determine the NV using an FOP methodology if the merchandise is 
exported from an NME and the information does not permit the 
calculation of NV using home-market prices, third-country prices, or 
constructed value under section 773(a) of the Act. The Department bases 
NV on FOPs because the presence of government controls on various 
aspects of NMEs 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).
    We calculated NV by adding together the value of the FOPs, general 
expenses, profit, and packing costs. The FOPs for subject merchandise 
include: (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 FOPs that Kangfa reported for materials, energy, labor, and 
packing, and valued those FOPs by multiplying the amount of the factor 
consumed in producing subject merchandise by the average unit surrogate 
value of the factor.
    In addition, we added freight costs to the surrogate costs that we 
calculated for material inputs. We calculated

[[Page 50950]]

freight costs by multiplying surrogate freight rates by the shorter of 
the reported distance from the domestic supplier to the factory that 
produced the subject merchandise or the distance from the nearest 
seaport to the factory that produced the subject merchandise, as 
appropriate. Where there were multiple domestic suppliers of a material 
input, we calculated a weighted-average distance after limiting each 
supplier's distance to no more than the distance from the nearest 
seaport to Kangfa. This adjustment is in accordance with the decision 
by the Court of Appeals for the Federal Circuit in Sigma Corp. v. 
United States, 117 F.3d 1401, 1407-1408 (Fed. Cir. 1997).
    We offset Kangfa's material costs for revenue generated from the 
sale of copper wire scrap and tin scrap. See Surrogate Values 
Memorandum at Exhibit 8.
    We also increased the calculated costs of the FOPs for surrogate 
general expenses and profit. See Surrogate Values Memorandum at Exhibit 
9.

2. Selection of Surrogate Values

    In selecting surrogate values, we followed, to the extent 
practicable, the Department's practice of choosing public values which 
are non-export averages, representative of a range of prices in effect 
during the POR, or over a period as close as possible in time to the 
POR, product-specific, and tax-exclusive. See, e.g., Notice of 
Preliminary Determination of Sales at Less Than Fair Value, Negative 
Preliminary Determination of Critical Circumstances and Postponement of 
Final Determination: Certain Frozen and Canned Warmwater Shrimp From 
the Socialist Republic of Vietnam, 69 FR 42672, 42682 (July 16, 2004), 
unchanged in Final Determination of Sales at Less Than Fair Value: 
Certain Frozen and Canned Warmwater Shrimp From the Socialist Republic 
of Vietnam, 69 FR 71005 (December 8, 2004). We also considered the 
quality of the source of surrogate information in selecting surrogate 
values. See Manganese Metal From the People's Republic of China; Final 
Results and Partial Rescission of Antidumping Duty Administrative 
Review, 63 FR 12440 (March 13, 1998). Where we could obtain only 
surrogate values that were not contemporaneous with the POR, we 
inflated (or deflated) the surrogate values using, where appropriate, 
the Indian wholesale price index (WPI) as published in International 
Financial Statistics by the International Monetary Fund. See Surrogate 
Values Memorandum at Exhibit 1.
    In calculating surrogate values from import statistics, in 
accordance with the Department's practice, we disregarded statistics 
for imports from NME countries and countries deemed to maintain broadly 
available, non-industry-specific subsidies which may benefit all 
exporters to all export markets (e.g., Indonesia, South Korea, and 
Thailand). See, e.g., Final Determination of Sales at Less Than Fair 
Value: Certain Automotive Replacement Glass Windshields From The 
People's Republic of China, 67 FR 6482 (February 12, 2002) and 
accompanying Issues and Decision Memorandum at Comment 1. See also 
Notice of Preliminary Determination of Sales at Less Than Fair Value, 
Postponement of Final Determination, and Affirmative Preliminary 
Determination of Critical Circumstances: Certain Color Television 
Receivers From the People's Republic of China, 68 FR 66800, 66808 
(November 28, 2003), unchanged in Notice of Final Determination of 
Sales at Less Than Fair Value and Negative Final Determination of 
Critical Circumstances: Certain Color Television Receivers From the 
People's Republic of China, 69 FR 20594 (April 16, 2004). Additionally, 
we excluded from our calculations imports that were labeled as 
originating from an unspecified country because we could not determine 
whether they were from an NME country.
    We valued production material inputs (mushroom spawn, wheat straw, 
and manure) using the financial statements of Agro Dutch, an Indian 
producer of mushrooms and vegetables, as follows. To value the input of 
mushroom spawn, we used data from Agro Dutch's FY 2004-2005 (April 
2004-March 2005) financial statement because Agro Dutch's mushroom 
spawn value is specific to the species Agaricus bisporous, which is the 
species used to produce subject merchandise. To value the input of 
wheat straw, we used the wheat straw value from Agro Dutch's FY 2006-
2007 (April 2006-March 2007) financial statement because this value is 
specific to the input. To value the input of manure, we used the manure 
value from Agro Dutch's FY 2004-2005 financial statement because this 
value is specific to the input. See Surrogate Values Memorandum at 
Exhibit 2. We adjusted these values for inflation. See Surrogate Values 
Memorandum at Exhibit 1.
    We valued processing and canning material inputs (super calcium 
phosphate, calcium carbonate, salt, citric acid, tin plate, copper 
wire, and sealing glue) using weighted-average Indian import values 
derived from the World Trade Atlas online (WTA), for the period 
February 2008 through January 2009. See Surrogate Values Memorandum at 
Exhibits 2 and 3. In addition, we valued packing material inputs 
(cartons, labels, hard paper board, and glue) with weighted-average 
Indian import values derived from the WTA for the period February 2008 
through January 2009. Id. at Exhibit 5. The Indian import statistics 
obtained from the WTA were published by the Indian Directorate General 
of Commercial Intelligence and Statistics, Ministry of Commerce of 
India, and are contemporaneous with the POR. As the Indian surrogate 
values were denominated in rupees, in accordance with section 773A(a) 
of the Act, we converted them to U.S. dollars using the official 
exchange rate for India recorded on the date of sale of subject 
merchandise in this case. See http://www.ia.ita.doc.gov/exchange/index.html.
    To value land rent, the Department used data from the 2001 Punjab 
State Development Report, administered by the Planning Commission of 
the Government of India. Since the value of land rent was not 
contemporaneous with the POR, the Department adjusted the value for 
inflation. See Surrogate Values Memorandum at Exhibit 2.
    We valued electricity using price data for small, medium, and large 
industries, as published by the Central Electricity Authority of the 
Government of India in its publication titled Electricity Tariff & Duty 
and Average Rates of Electricity Supply in India, dated July 2006. 
These electricity rates represent actual country-wide publicly-
available information on tax-exclusive electricity rates charged to 
industries in India. As the rates listed in this source became 
effective on a variety of different dates, we are not adjusting the 
average value for inflation. See Surrogate Value Memorandum at Exhibit 
4.
    To value water, the Department used the revised Maharastra 
Industrial Development Corporation water rates, which are available at 
http://www.midcindia.com/water-supply. The Department found this source 
to be the best available information since it includes a wide range of 
industrial water rates. Since the water rates were not contemporaneous 
with the POR, the Department adjusted the value for inflation. See 
Surrogate Values Memorandum at Exhibit 4.
    We valued coal using weighted-average Indian import values derived 
from the WTA for the period February 2008 through January 2009. See

[[Page 50951]]

Surrogate Values Memorandum at Exhibit 4.
    We valued truck freight expenses for inputs using the same 
surrogate data we used for valuing domestic inland freight for Kangfa's 
U.S. sale (i.e., we used data from the Web site http://www.infobanc.com/logistics/logtruck.htm, which contains inland freight 
truck rates between many large Indian cities). See Surrogate Values 
Memorandum at Exhibit 6.
    The Department's regulations require the use of a regression-based 
wage rate. See 19 CFR 351.408(c)(3). Therefore, to value labor, the 
Department used the regression-based wage rate for the PRC published on 
the Import Administration Web site. See the IA Web site: http://ia.ita.doc.gov/wages/05wages/05wages-041608.html, and see Corrected 
2007 Calculation of Expected Non-Market Economy Wages, 73 FR 27795 (May 
14, 2008).
    To value the surrogate financial ratios for factory overhead (OH), 
selling, general & administrative (SG&A) expenses, and profit, the 
Department used the 2006-2007 financial statements of Agro Dutch and 
Flex Foods Limited (Flex Foods). Agro Dutch is a producer of mushrooms, 
and Flex Foods is a producer of mushrooms and other vegetable products. 
Agro Dutch's and Flex Foods' financial ratios for OH and SG&A are 
comparable to Kangfa's financial ratios because Agro Dutch's and Flex 
Foods' production experience is comparable to Kangfa's production 
experience by virtue of each company's production of subject 
merchandise. Moreover, an average of the financial statements of Agro 
Dutch and Flex Foods represents a broader spectrum of the Indian 
mushroom industry than does the financial statement of a single 
mushroom producer. See Surrogate Values Memorandum at Exhibit 9.

Currency Conversion

    We made currency conversions into U.S. dollars, in accordance with 
section 773A(a) of the Act, based on the exchange rates in effect on 
the dates of the U.S. sales as certified by the Federal Reserve Bank. 
These exchange rates can be accessed at the Web site of Import 
Administration at http://ia.ita.doc.gov/exchange/index.html.

Preliminary Results of Review

    We preliminarily determine that the following dumping margin exists 
during the period February 1, 2008, through January 31, 2009:

------------------------------------------------------------------------
                                                                Margin
                   Manufacturer/exporter                      (percent)
------------------------------------------------------------------------
Linyi City Kangfa Foodstuff Drinkable Co., Ltd. (Kangfa)...         0.00
------------------------------------------------------------------------

Public Comment

    In accordance with 19 CFR 351.224(b), the Department will disclose 
to parties to this proceeding the calculations performed in reaching 
the preliminary results within five days of publication of these 
preliminary results. Interested parties may submit written comments 
(case briefs) within 30 days of publication of the preliminary results 
and rebuttal comments (rebuttal briefs) within five days after the time 
limit for filing case briefs. See 19 CFR 351.309(c)(1)(ii) and 
351.309(d)(1). Pursuant to 19 CFR 351.309(d)(2), rebuttal briefs must 
be limited to issues raised in the case briefs. Parties who submit 
arguments are requested to submit with the case or rebuttal briefs: (1) 
A statement of the issue; (2) a brief summary of the argument; and (3) 
a table of authorities. Further, the Department requests that parties 
submitting written comments provide the Department with a diskette 
containing the public version of those comments.
    Any interested party may request a hearing within 30 days of 
publication of this notice. See 19 CFR 351.310(c). Interested parties 
who wish to request a hearing or to participate if one is requested, 
must submit a written request to the Assistant Secretary for Import 
Administration within 30 days of publication of this notice. Requests 
should contain: (1) The party's name, address, and telephone number; 
(2) the number of participants; and (3) a list of issues to be 
discussed. See 19 CFR 351.310(c). Issues raised in the hearing will be 
limited to those raised in the briefs.
    Unless the deadline is extended pursuant to section 
751(a)(2)(B)(iv) of the Act, the Department will issue the final 
results of this new shipper review, including the results of our 
analysis of the issues raised by the parties in their comments, within 
90 days of publication of these preliminary results.

Assessment Rates

    Upon issuing the final results of the review, 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 duties 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. However, 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, when imposed, will be 
effective upon publication of the final results of this new shipper 
review for all shipments of subject merchandise exported by Kangfa 
entered, or withdrawn from warehouse, for consumption on or after the 
publication date, as provided by section 751(a)(2)(C) of the Act: (1) 
For subject merchandise manufactured and exported by Kangfa, the cash-
deposit rate will be that established in the final results of this 
review; (2) for subject merchandise exported by Kangfa but not 
manufactured by Kangfa, the cash deposit rate will continue to be the 
PRC-wide rate (i.e., 198.63 percent); and (3) for subject merchandise 
manufactured by Kangfa but exported by any other party, the cash 
deposit rate will be the rate applicable to the exporter. If the cash 
deposit rate calculated for Kangfa in the final results is zero or de 
minimis, a cash deposit will be not be required for entries of subject 
merchandise both produced and exported by Kangfa. These cash deposit 
requirements, when imposed, shall remain in effect until further 
notice.

Notification to Importers

    This notice serves as a preliminary reminder to importers of their 
responsibility under 19 CFR 351.402(f)(2) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    This new shipper review and notice are in accordance with sections 
751(a)(2)(B) and 777(i) of the Act and 19 CFR 351.214(i).


[[Page 50952]]


    Dated: September 28, 2009.
John M. Andersen,
Acting Deputy Assistant Secretary for Antidumping and Countervailing 
Duty Operations.
[FR Doc. E9-23833 Filed 10-1-09; 8:45 am]
BILLING CODE 3510-DS-P