Laminated Woven Sacks From the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review, 55568-55574 [2010-22778]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 75, Number 176 (Monday, September 13, 2010)]
[Notices]
[Pages 55568-55574]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-22778]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-916]


Laminated Woven Sacks From the People's Republic of China: 
Preliminary Results of Antidumping Duty Administrative Review

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

DATES: Effective Date: September 13, 2010.
SUMMARY: The Department of Commerce (``the Department'') is conducting 
the first administrative review of the antidumping duty order on 
laminated woven sacks (``woven sacks'') from the People's Republic of 
China (``PRC'') for the period of review (``POR'') January 31, 2008, 
through July 31, 2009. The Department has preliminarily determined that 
sales have been made below normal value (``NV'') by the respondent. If 
these preliminary results are adopted in our final results of this 
review, the Department will instruct U.S. Customs and Border Protection 
(``CBP'') to assess antidumping duties on all appropriate entries of 
subject merchandise during the POR. Interested parties are invited to 
comment on these preliminary results. We intend to issue

[[Page 55569]]

the final results of this review no later than 120 days from the date 
of publication of this notice.

FOR FURTHER INFORMATION CONTACT: Brandon Farlander, AD/CVD Operations, 
Office 4, Import Administration, International Trade Administration, 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., 
Washington, DC 20230, telephone: (202) 482-0182.

SUPPLEMENTARY INFORMATION: 

Background

    On August 7, 2008, the Department published in the Federal Register 
the antidumping duty order on woven sacks from the PRC.\1\ On August 3, 
2009, the Department published a notice of opportunity to request an 
administrative review of the Woven Sacks Order.\2\
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    \1\ See Notice of Antidumping Duty Order: Laminated Woven Sacks 
From the People's Republic of China, 73 FR 45941 (August 7, 2008) 
(``Woven Sacks Order'').
    \2\ See Antidumping or Countervailing Duty Order, Finding, or 
Suspended Investigation; Opportunity To Request Administrative 
Review, 74 FR 38397 (August 3, 2009).
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    The Department received a timely request for an administrative 
review of the Woven Sacks Order from Zibo Aifudi Plastic Packaging Co., 
Ltd. (``Zibo Aifudi'') and Changshu Xinsheng Bags Producing Company, 
Ltd. (``Changshu Xinsheng Bags'') on August 26, 2009, and August 31, 
2009, respectively, in accordance with section 751(a) of Tariff Act of 
1930, as amended (the ``Act''). On September 22, 2009, the Department 
published in the Federal Register a notice of the initiation of an 
administrative review of the Woven Sacks Order.\3\ The review was 
initiated with respect to both Zibo Aifudi and Changshu Xinsheng Bags. 
On November 6, 2009, Changshu Xinsheng Bags submitted to the Department 
a timely letter requesting a withdrawal from the ongoing administrative 
review. On December 17, 2009, the Department rescinded the review with 
respect to Changshu Xinsheng Bags.\4\
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    \3\ See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Request for Revocation in Part, 74 FR 
48224 (September 22, 2009) (``Initiation Notice'').
    \4\ See Laminated Woven Sacks from the People's Republic of 
China: Partial Rescission of Antidumping Duty Administrative Review, 
74 FR 66954 (December 17, 2009).
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    The Department issued supplemental questionnaires to Zibo Aifudi 
from January to June 2010. The Department received responses to its 
supplemental questionnaires from Zibo Aifudi from January to July 2010. 
From January to July 2010, Petitioners \5\ submitted comments to the 
Department regarding the submissions and/or responses of Zibo Aifudi.
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    \5\ Petitioners are the Laminated Woven Sacks Committee and its 
individual members, Coating Excellence International, LLC and 
Polytex Fibers Corporation.
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    On March 3, 2010, the Department released a letter to interested 
parties which listed potential surrogate countries and invited 
interested parties to comment on surrogate country and surrogate value 
(``SV'') selection. Between March and July 2010, Petitioners and Zibo 
Aifudi submitted publicly available SV information, comments, and 
rebuttal comments on the selection of a surrogate country and SVs. On 
July 9, 2010, the Department requested additional information and 
analysis regarding the three financial statements on the record from 
Petitioners and Zibo Aifudi. For a discussion of the selection of the 
surrogate country, see ``Surrogate Country'' section below.
    On April 20, 2010, and August 16, 2010, pursuant to section 
751(a)(3)(A) of the Act, the Department extended the time period for 
completing the preliminary results by 90 days and 30 days, 
respectively.\6\
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    \6\ See Laminated Woven Sacks from the People's Republic of 
China: Extension of the Time Limit for the Preliminary Results of 
the Antidumping Duty Administrative Review, 75 FR 20564 (April 20, 
2010); see Laminated Woven Sacks from the People's Republic of 
China: Extension of the Time Limit for the Preliminary Results of 
the Antidumping Duty Administrative Review, 75 FR 49888 (August 16, 
2010).
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    On May 25, 2010, the Department preliminarily determined that the 
PRC is the country of origin of woven sacks produced in the PRC from 
imported fabric. As a result, the Department preliminarily determined 
that the woven sacks produced in the PRC by Zibo Aifudi from imported 
fabric and imported by Zibo Aifudi into the United States are within 
the scope of the order.\7\
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    \7\ See Memorandum to Abdelali Elouaradia, Office Director, AD/
CVD Operations, Office 4, from Zhulieta Willbrand, International 
Trade Analyst, AD/CVD Operations, Office 4, ``Preliminary Decision 
Regarding the Country of Origin of Laminated Woven Sacks Exported by 
Zibo Aifudi Plastic Packaging Co., Ltd.,--Laminated Woven Sacks from 
the People's Republic of China'' (May 25, 2010).
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    On August 6, 2010, the Department issued a supplemental 
questionnaire to Zibo Aifudi regarding its consumption of imported 
woven fabric. On August 18, 2010, Zibo Aifudi responded to the 
Department's supplemental questionnaire and provided an explanation, 
with supporting documentation, of its consumption of imported woven 
fabric. See the Factor Valuation Methodology section below for 
additional information.

Scope of the Order

    The merchandise subject to the order is laminated woven sacks. 
Laminated woven sacks are bags or sacks consisting of one or more plies 
of fabric consisting of woven polypropylene strip and/or woven 
polyethylene strip, regardless of the width of the strip; with or 
without an extrusion coating of polypropylene and/or polyethylene on 
one or both sides of the fabric; laminated by any method either to an 
exterior ply of plastic film such as biaxially-oriented polypropylene 
(``BOPP'') or to an exterior ply of paper that is suitable for high 
quality print graphics; \8\ printed with three colors or more in 
register; with or without lining; whether or not closed on one end; 
whether or not in roll form (including sheets, lay-flat tubing, and 
sleeves); with or without handles; with or without special closing 
features; not exceeding one kilogram in weight. Laminated woven sacks 
are typically used for retail packaging of consumer goods such as pet 
foods and bird seed.
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    \8\ ``Paper suitable for high quality print graphics,'' as used 
herein, means paper having an ISO brightness of 82 or higher and a 
Sheffield Smoothness of 250 or less. Coated free sheet is an example 
of a paper suitable for high quality print graphics.
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    Effective July 1, 2007, laminated woven sacks are classifiable 
under Harmonized Tariff Schedule of the United States (``HTSUS'') 
subheadings 6305.33.0050 and 6305.33.0080. Laminated woven sacks were 
previously classifiable under HTSUS subheading 6305.33.0020. If entered 
with plastic coating on both sides of the fabric consisting of woven 
polypropylene strip and/or woven polyethylene strip, laminated woven 
sacks may be classifiable under HTSUS subheadings 3923.21.0080, 
3923.21.0095, and 3923.29.0000. If entered not closed on one end or in 
roll form (including sheets, lay-flat tubing, and sleeves), laminated 
woven sacks may be classifiable under other HTSUS subheadings including 
3917.39.0050, 3921.90.1100, 3921.90.1500, and 5903.90.2500. If the 
polypropylene strips and/or polyethylene strips making up the fabric 
measure more than 5 millimeters in width, laminated woven sacks may be 
classifiable under other HTSUS subheadings including 4601.99.0500, 
4601.99.9000, and 4602.90.0000. Although HTSUS subheadings are provided 
for convenience and customs purposes, the written description of the 
scope of the order is dispositive.

[[Page 55570]]

Non-Market Economy Treatment

    The Department considers the PRC to be a non-market economy 
(``NME'') country.\9\ 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 
review. Therefore, the Department continues to treat the PRC as an NME 
country for purposes of these preliminary results.
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    \9\ See, e.g., 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).
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Surrogate Country

    When the Department reviews 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 SVs that the Department has 
used in this review are discussed under the ``Normal Value'' section 
below.
    In this review, the Department determined that India, the 
Philippines, Indonesia, Thailand, Ukraine, and Peru are countries 
comparable to the PRC in terms of economic development.\10\ Once the 
countries that are economically comparable to the PRC have been 
identified, the Department selects an appropriate surrogate country by 
determining whether an economically comparable country is a significant 
producer of comparable merchandise and whether the data for valuing 
FOPs are both available and reliable.
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    \10\ See Memorandum from Kelly Parkhill, Acting Director, Office 
of Policy, to Robert Bolling, Program Manager, AD/CVD Operations, 
Office 4, ``Request for a List of Surrogate Countries for an 
Administrative Review of the Antidumping Duty Order on Laminated 
Woven Sacks from the People's Republic of China'' (January 25, 
2010).
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    The Department has preliminarily determined that it is appropriate 
to use India as a surrogate country pursuant to section 773(c)(4) of 
the Act based on the following: (1) It is at a similar level of 
economic development to the PRC pursuant to section 773(c)(4) of the 
Act; (2) it is a significant producer of comparable merchandise; and 
(3) the Department has reliable data from India that it can use to 
value the FOPs.\11\ Thus, the Department calculated NV using Indian 
prices when available and appropriate to value the FOPs of Zibo Aifudi. 
The Department obtained and relied upon publicly available information 
wherever possible.\12\
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    \11\ Petitioners submitted surrogate country information and 
recommended India as the surrogate country. See Petitioners' March 
12, 2010 surrogate country comments.
    \12\ See Memorandum to the File from Brandon Farlander, 
International Trade Compliance Analyst, AD/CVD Operations, Office 4, 
``Administrative Review of Laminated Woven Sacks from the People's 
Republic of China: Surrogate Value Memorandum,'' (September 3, 2010) 
(``Surrogate Value Memorandum'').
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    In accordance with 19 CFR 351.301(c)(3)(ii), interested parties may 
submit publicly-available information to value FOPs until 20 days after 
the date of publication of the preliminary results.\13\
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    \13\ In accordance with 19 CFR 351.301(c)(1), for the final 
results of this administrative review, 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 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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Separate Rates

    In proceedings involving NME countries, the Department holds a 
rebuttable presumption that all companies within the country are 
subject to government control and thus should be assessed a single 
antidumping duty rate. It is the Department's policy to assign all 
exporters of subject merchandise 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. Exporters can demonstrate this 
independence through the absence of both de jure and de facto 
governmental control over export activities. The Department analyzes 
each entity exporting the subject merchandise under the test announced 
in the Notice of Final Determination of Sales at Less Than Fair Value: 
Sparklers from the People's Republic of China, 56 FR 20588 (May 6, 
1991) (``Sparklers''), as further developed in Notice of Final 
Determination of Sales at Less Than Fair Value: Silicon Carbide from 
the People's Republic of China, 59 FR 22585 (May 2, 1994) (``Silicon 
Carbide''). However, if the Department determines that a company is 
wholly foreign-owned or located in a market economy, then a separate 
rate analysis is not necessary to determine whether it is independent 
from government control.
    The mandatory respondent, Zibo Aifudi, provided evidence that it is 
a joint venture between PRC and U.S. companies. The Department has 
analyzed whether Zibo Aifudi has demonstrated the absence of de jure 
and de facto governmental control over its export activities.

a. Absence of De Jure Control

    The Department considers the following de jure criteria in 
determining whether an individual company may be granted a separate 
rate: (1) An absence of restrictive stipulations associated with an 
individual exporter's business and export license; (2) legislative 
enactments decentralizing control of companies; and (3) other formal 
measures by the government decentralizing control of companies.\14\ The 
evidence provided by Zibo Aifudi supports a preliminary finding that 
all of the above criteria have been satisfied.\15\
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    \14\ See Sparklers, 56 FR at 20589.
    \15\ See Zibo Aifudi's Section A response, dated October 26, 
2009, at 4-7.
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    Specifically, the evidence provided by Zibo Aifudi 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 
existence of applicable legislative enactments decentralizing control 
of Chinese companies; and (3) the implementation of formal measures by 
the government decentralizing control of Chinese companies.\16\
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    \16\ Id.
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b. 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

[[Page 55571]]

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.\17\ 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.
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    \17\ 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).
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    The evidence provided by Zibo Aifudi supports a preliminary finding 
of de facto absence of governmental control based on record statements 
and supporting documentation showing that the company: (1) Set its own 
export prices independent of the government and without the approval of 
a government authority; (2) has the authority to negotiate and sign 
contracts and other agreements; (3) maintains autonomy from the 
government in making decisions regarding the selection of management; 
and (4) retains the proceeds of its export sales and makes independent 
decisions regarding disposition of profits or financing of losses.\18\
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    \18\ See Zibo Aifudi's Section A response, dated October 26, 
2009, at 7-10.
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    Therefore, the evidence placed on the record of this review by Zibo 
Aifudi demonstrates an absence of de jure and de facto government 
control under the criteria identified in Sparklers and Silicon Carbide. 
Accordingly, the Department has preliminarily granted Zibo Aifudi 
separate rate status.\19\
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    \19\ See ``Preliminary Results of Review'' section below.
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Fair Value Comparison

    To determine whether sales of woven sacks to the United States by 
Zibo Aifudi were made at less than fair value, the Department compared 
export price (``EP'') and constructed export price (``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(a) of the Act, the Department used 
EP as the basis for U.S. price for Zibo Aifudi's sales where the first 
sale to unaffiliated purchasers was made prior to importation and the 
use of CEP was not otherwise warranted. In accordance with section 
772(c) of the Act, the Department calculated EP for Zibo Aifudi by 
deducting the following expenses from the starting price charged to the 
first unaffiliated customer in the United States: Foreign inland 
freight from the plant to the port of exportation and foreign brokerage 
and handling. Additionally, for the expenses that were either provided 
by an NME vendor or paid for using an NME currency, the Department 
based the expenses on SVs, as appropriate. For details regarding our EP 
calculations, see Memorandum from Brandon Farlander, International 
Trade Compliance Analyst, AD/CVD Operations, Office 4, to the File, 
``Administrative Review of Laminated Woven Sacks from the People's 
Republic of China: Preliminary Analysis Memorandum for Zibo Aifudi 
Plastic Packaging Co., Ltd.'' (September 3, 2010) (``Zibo Aifudi 
Analysis Memo'').
    In accordance with section 772(b) of the Act, the Department used 
CEP as the basis for U.S. price for Zibo Aifudi's sales where Zibo 
Aifudi first sold subject merchandise to its affiliated companies in 
the United States (AMS Associates, Inc. (d.b.a. Shapiro Packing, Inc.) 
or Excel Packaging, LLC), which in turn sold subject merchandise to 
unaffiliated U.S. customers. In accordance with section 772(b) of the 
Act, CEP is the price at which the subject merchandise is first sold 
(or agreed to be sold) in the United States before or after the date of 
importation by or for the account of the producer or exporter of such 
merchandise or by a seller affiliated with the producer or exporter, to 
a purchaser not affiliated with the producer or exporter, as adjusted 
under sections 772(c) and (d) of the Act. The Department calculated CEP 
for Zibo Aifudi based on delivered prices to unaffiliated purchasers in 
the United States and made deductions, where applicable, from the U.S. 
sales price for movement expenses and appropriate selling adjustments, 
such as early payment discounts, in accordance with section 
772(c)(2)(A) of the Act. These movement expenses included foreign 
inland freight from the plant to the port of exportation, foreign 
brokerage and handling, international freight, marine insurance, U.S. 
customs duty, U.S. brokerage, and U.S. inland freight from port to the 
U.S. customer. In accordance with section 772(d)(1) of the Act, the 
Department deducted billing adjustments, early payment discounts, 
credit expenses and indirect selling expenses from the U.S. price, all 
of which relate to commercial activity in the United States. Also, the 
Department deducted CEP profit, in accordance with sections 772(d)(3) 
and 772(f) of the Act. Additionally, for the expenses that were either 
provided by an NME vendor or paid for using an NME currency, the 
Department based the expenses on SVs, as appropriate. For details 
regarding the CEP calculation, see Zibo Aifudi Analysis Memo.

Normal Value

    Section 773(c)(1) of the Act provides that the Department shall 
determine 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.\20\
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    \20\ See, e.g., Preliminary Determination of Sales at Less Than 
Fair Value, Affirmative Critical Circumstances, In Part, and 
Postponement of Final Determination: Certain Lined Paper Products 
from the People's Republic of China, 71 FR 19695, 19703 (April 17, 
2006), unchanged in Notice of Final Determination of Sales at Less 
Than Fair Value, and Affirmative Critical Circumstances, In Part: 
Certain Lined Paper Products From the People's Republic of China, 71 
FR 53079 (September 8, 2006).
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    As the basis for NV, Zibo Aifudi provided FOPs used in the 
production of woven sacks. Consistent with section 773(c)(1)(B) of the 
Act, it is the Department's practice to value the FOPs that a 
respondent uses to produce woven sacks.

Factor Valuation Methodology

    In accordance with section 773(c) of the Act, the Department 
calculated NV based on FOP data reported by Zibo Aifudi. To calculate 
NV, the Department multiplied the reported per-unit factor-consumption 
rates by publicly available Indian SVs. In selecting the SVs, the 
Department considered the quality, specificity, and contemporaneity of 
the data.\21\ As appropriate, the Department adjusted input prices by 
including freight costs to make them delivered prices. Specifically, 
the Department added to Indian import SVs a surrogate freight cost 
using the shorter of the reported distance from the domestic supplier 
to the factory or the distance from the nearest seaport to the factory 
where appropriate. This adjustment is

[[Page 55572]]

in accordance with the Court of Appeals for the Federal Circuit's 
decision in Sigma Corp. v. United States, 117 F.3d 1401, 1407-08 (Fed. 
Cir. 1997). A detailed description of all SVs used for Zibo Aifudi can 
be found in the Surrogate Value Memorandum, at Exhibit 1.
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    \21\ See, e.g., Fresh Garlic From the People's Republic of 
China: Final Results of Antidumping Duty New Shipper Review, 67 FR 
72139 (December 4, 2002) and accompanying Issues and Decision 
Memorandum at Comment 6; Final Results of First New Shipper Review 
and First Antidumping Duty Administrative Review: Certain Preserved 
Mushrooms From the People's Republic of China, 66 FR 31204 (June 11, 
2001) and accompanying Issues and Decision Memorandum at Comment 5.
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    Zibo Aifudi reported that several of its raw material inputs (i.e., 
color ink and woven fabric) were sourced from market-economy countries 
and paid for in market-economy currencies. Pursuant to 19 CFR 
351.408(c)(1), when a respondent sources inputs from a market-economy 
supplier in meaningful quantities (i.e., not insignificant quantities), 
the Department normally will use the actual price paid by the 
respondent for those inputs.\22\ Because information reported by Zibo 
Aifudi demonstrates that it purchased significant quantities (i.e., 33 
percent or more) of colored ink and woven fabric from market-economy 
suppliers, the Department used Zibo Aifudi's actual market-economy 
purchase prices of colored ink and woven fabric to value its FOPs for 
this input.\23\ Where appropriate, freight expenses were added to the 
market-economy prices of this input. When Zibo Aifudi made market 
economy colored ink and woven fabric purchases that may have been 
dumped or subsidized, were not bona fide, or were otherwise not 
acceptable for use in a dumping calculation, the Department excluded 
them from the numerator of the ratio to ensure a fair determination of 
whether valid market-economy purchases meet the 33 percent 
threshold.\24\
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    \22\ See Antidumping Duties; Countervailing Duties, 62 FR 27296, 
27366 (May 19, 1997).
    \23\ See Antidumping Methodologies: Market Economy Inputs, 
Expected Non-Market Economy Wages, Duty Drawback; and Request for 
Comments, 71 FR 61716, 61717 (October 19, 2006) (``Antidumping 
Methodologies'').
    \24\ See Antidumping Methodologies, 71 FR at 61717-18.
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    In past cases, it has been the Department's practice to value 
various FOPs using import statistics of the primary selected surrogate 
country from World Trade Atlas (``WTA''), as published by Global Trade 
Information Services (``GTIS'').\25\ However, in a recent case, the 
OCTG Final, the Department explained, based on discussions with GTIS, 
that the Indian import data obtained from the WTA, as published by 
GTIS, began identifying the original reporting currency for India as 
the U.S. Dollar rather than the Indian Rupee, as was previously 
reported by GTIS for Indian import data.\26\ While the original India 
import data\27\ obtained by GTIS is denominated and published in Indian 
Rupees, in the OCTG Final, the Department noted that GTIS made a 
decision to change the original reporting currency for Indian data from 
the Indian Rupee to the U.S. Dollar in order to reduce the loss of the 
number of significant digits when obtaining data through the WTA 
software. Additionally, in the OCTG Final, the Department also noted 
that subsequently, GTIS restored the ability to view Indian Rupee 
values in the WTA software for Indian import data. However, because 
this data was twice converted\28\, it was found that this data would 
not correspond to the original India data based on the WTA software's 
capability to only handle a limited number of significant digits in 
each conversion calculation.
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    \25\ See e.g., Certain Preserved Mushrooms From the People's 
Republic of China: Preliminary Results of Antidumping Duty New 
Shipper Review, 74 FR 50946, 50950 (October 2, 2009).
    \26\ See Certain Oil Country Tubular Goods from the People's 
Republic of China: Final Determination of Sales at Less Than Fair 
Value, Affirmative Final Determination of Critical Circumstances, 
and Final Determination of Targeted Dumping, 75 FR 20335 (April 19, 
2010) and accompanying Issues and Decision Memorandum at Comment 4 
(``OCTG Final'').
    \27\ GTIS obtains data on imports into India directly from the 
Ministry of Commerce, Government of India.
    \28\ Converted from Indian Rupee to U.S. Dollar, then converted 
from U.S. Dollar to Indian Rupee.
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    Because of the conversion and rounding problems in the data 
reported by the WTA, the Department will now obtain import statistics 
from Global Trade Atlas (``GTA''), as published by GTIS, for valuing 
various FOPs. The data reported in the GTA software reports import 
statistics, such as from India, in the original reporting currency and 
thus this data corresponds to the original currency value reported by 
each country. Additionally, the data reported in the GTA software is 
reported to the nearest digit and thus there is not a loss of data by 
rounding, as there is with the data reported by the WTA software. 
Consequently the import statistics we obtain from GTA are in the 
original reporting currency of the country from which the data are 
obtained and have the same level of accuracy as the original data 
released.
    The Department used data from the Indian import statistics in the 
GTA and other publicly available Indian sources in order to calculate 
SVs for Zibo Aifudi's FOPs (i.e., direct materials, energy, packing 
materials) and certain movement expenses. In selecting the best 
available information for valuing FOPs in accordance with section 
773(c)(1) of the Act, the Department's practice is to select, to the 
extent practicable, SVs which are non-export average values, most 
contemporaneous with the POR, product-specific, and tax-exclusive.\29\ 
The record shows that data in the GTA Indian import statistics, as well 
as those from the other Indian sources, are contemporaneous with the 
POR, product-specific, and tax-exclusive.\30\
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    \29\ 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).
    \30\ See Surrogate Value Memorandum at Exhibit 1.
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    In accordance with legislative history, the Department continues to 
apply its long-standing practice of disregarding SVs if it has a reason 
to believe or suspect the source data may be subsidized.\31\ In this 
regard, the Department has previously found that it is appropriate to 
disregard such prices from Indonesia, South Korea and Thailand because 
we have determined that these countries maintain broadly available, 
non-industry specific export subsidies.\32\ Based on the existence of 
these subsidy programs that were generally available to all exporters 
and producers in these countries at the time of the POR, the Department 
finds that it is reasonable to infer that all exporters from Indonesia, 
South Korea and Thailand may have benefitted from these subsidies. 
Therefore, the Department has not used prices from these three 
countries in calculating the Indian import-based SVs.
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    \31\ Omnibus Trade and Competitiveness Act of 1988, Conf. Report 
To Accompany H.R. 3, H.R. Rep. No. 576, 100th Cong., 2nd Sess. 
(1988) at 590.
    \32\ See e.g., Carbazole Violet Pigment 23 From India: Final 
Results of the Expedited Five-Year (Sunset) Review of the 
Countervailing Duty Order, 75 FR 13257 (March 19, 2010) and 
accompanying Issues and Decision Memorandum at 4-5; Certain Cut-to-
Length Carbon-Quality Steel Plate From Indonesia: Final Results of 
Expedited Sunset Review, 70 FR 45692 (August 8, 2005) and 
accompanying Issues and Decision Memorandum at 4; Corrosion-
Resistant Carbon Steel Flat Products From the Republic of Korea: 
Final Results of Countervailing Duty Administrative Review, 74 FR 
2512 (January 15, 2009) and accompanying Issues and Decision 
Memorandum at 17, 19-20; Final Affirmative Countervailing Duty 
Determination: Certain Hot-Rolled Carbon Steel Flat Products From 
Thailand, 66 FR 50410 (October 3, 2001) and accompanying Issues and 
Decision Memorandum at 23.
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    Additionally, the Department disregarded prices from NME countries. 
Finally, imports that were labeled as originating from an 
``unspecified'' country were excluded from the average value, because 
the Department could not be certain that they were not from

[[Page 55573]]

either an NME country or a country with general export subsidies.\33\
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    \33\ See Polyethylene Terephthalate Film, Sheet, and Strip From 
the People's Republic of China: Preliminary Determination of Sales 
at Less Than Fair Value, 73 FR 24552, 24559 (May 5, 2008), unchanged 
in 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 (September 24, 2008).
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    Petitioners raised concerns regarding Zibo Aifudi's FOPs for the 
production of woven sacks from imported woven fabric and we sought 
additional information from Zibo Aifudi regarding its production of 
woven sacks from imported woven fabric. At this time, we are still 
examining this matter and may issue additional supplemental questions 
regarding Zibo Aifudi's material consumption and production process for 
woven sacks produced from imported woven fabric. For the preliminary 
results, we have determined to use Zibo Aifudi's reported FOP data, 
specifically Zibo Aifudi's FOPs used to produce woven sacks from 
imported woven fabric, to calculate its margin. See Zibo Aifudi 
Analysis Memo. However, we intend to continue to analyze this issue for 
the final results.
    For direct, indirect, and packing labor, pursuant to a recent 
decision by the Court of Appeals for the Federal Circuit, we are no 
longer using the regression based methodology to value labor.\34\ 
Rather, we have calculated an hourly wage rate to use in valuing each 
respondent's reported labor input by averaging available data for 
earnings and/or wages in countries that are economically comparable to 
the PRC, and that are significant producers of comparable merchandise. 
Because this wage rate does not separate the labor rates into different 
skill levels or types of labor, the Department has applied the same 
wage rate to all skill levels and types of labor reported by the 
respondents.\35\
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    \34\ See Dorbest Ltd. v. United States, 604 F.3d 1363, 1372-73 
(CAFC 2010).
    \35\ See Surrogate Value Memorandum at Exhibit 2.
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    The Department valued truck freight expenses using a per-unit 
average rate calculated from data on the infobanc Web site: https://www.infobanc.com/logistics/logtruck.htm. The logistics section of this 
Web site contains inland freight truck rates between many large Indian 
cities. The value is contemporaneous with the POR.\36\
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    \36\ See Surrogate Value Memorandum at Exhibit 4.
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    The Department 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 entitled 
``Electricity Tariff & Duty and Average Rates of Electricity Supply in 
India,'' dated March 2008. These electricity rates represent actual 
country-wide, publicly available information on tax-exclusive 
electricity rates charged to industries in India. We did not inflate 
this value because utility rates represent current rates, as indicated 
by the effective dates listed for each of the rates provided.\37\
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    \37\ See Surrogate Value Memorandum at Exhibit 3.
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    We valued brokerage and handling expenses using a price list of 
export procedures necessary to export a standardized cargo of goods in 
India. The price list is compiled based on a survey case study of the 
procedural requirements for trading a standard shipment of goods by 
ocean freight in India that is published in Doing Business 2009: India, 
published by the World Bank. Because these data were current throughout 
the POR, we did not inflate the value for brokerage and handling.\38\
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    \38\ See Surrogate Value Memorandum at Exhibit 5.
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    To value factory overhead, selling, general, and administrative 
expenses, and profit, the Department used the factory overhead, 
selling, general and administrative expenses, and profit data from two 
Indian companies, KG Petrochem Limited, and Emmbi Polyarns Limited, 
producers of merchandise comparable to the subject merchandise, for the 
fiscal year April 1, 2008, through March 31, 2009.\39\ The Department 
did not rely on the financial statements of Deccan Polypacks Limited 
(``Deccan Polypacks'') because the record indicates that during this 
period, Deccan Polypacks received subsidies the Department has 
previously determined to be countervailable. Consistent with Department 
practice, we do not use financial statements of a company that we have 
reason to believe or suspect may have received subsidies, where there 
are other sufficient reliable and representative data on the record for 
purposes of calculating the surrogate financial ratios, because the 
financial statements of companies receiving actionable subsidies are 
less representative of the financial experience of the relevant 
industry than the ratios derived from financial statements that do not 
contain evidence of subsidization.\40\ In this case, Deccan Polypacks' 
2008-2009 financial statements indicate that Deccan Polypacks received 
benefits under the Advance License Scheme.\41\ India's Advance License 
Scheme has been found by the Department to provide a countervailable 
subsidy.\42\
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    \39\ See Surrogate Value Memorandum at Exhibit 6.
    \40\ See Certain New Pneumatic Off-the-Road Tires From the 
People's Republic of China: Final Affirmative Determination of Sales 
at Less Than Fair Value and Partial Affirmative Determination of 
Critical Circumstances, 73 FR 40485 (July 15, 2008) and accompanying 
Issues and Decision Memorandum at Comment 17A; Certain Frozen 
Warmwater Shrimp From the People's Republic of China: Notice of 
Final Results and Rescission, in Part, of 2004/2006 Antidumping Duty 
Administrative and New Shipper Reviews, 72 FR 52049 (September 12, 
2007) and accompanying Issues and Decision Memorandum at Comment 2 
(citing Freshwater Crawfish Tail Meat From the People's Republic of 
China: Notice of Final Results and Rescission, In Part, of 2004/2005 
Antidumping Duty Administrative and New Shipper Reviews, 72 FR 19174 
(April 17, 2007)).
    \41\ See Annual Report 2008-2009, Deccan Polypacks, at 35 of 
Attachment 2 of Zibo Aifudi's March 31, 2010, surrogate value 
submission.
    \42\ See 1-Hydroxyethylidene-1, 1-Diphosphonic Acid From the 
People's Republic of China: Final Determination of Sales at Less 
Than Fair Value, 74 FR 10545 (March 11, 2009) and accompanying 
Issues and Decision Memorandum at Comment 1.
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Currency Conversion

    The Department 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 are available on the IA Web site at 
https://ia.ita.doc.gov/exchange/.

Preliminary Results of Review

    The Department preliminarily determines that the following 
weighted-average dumping margin exists:

------------------------------------------------------------------------
                                                              Weighted-
                                                               average
                     Exporter/producer                         percent
                                                                margin
------------------------------------------------------------------------
Zibo Aifudi Plastic Packaging Co., Ltd.....................        0.68
------------------------------------------------------------------------

Disclosure

    The Department will disclose the calculations performed within five 
days of the date of publication of this notice to parties in this 
proceeding in accordance with 19 CFR 351.224(b).

Public Comment

    Interested parties may submit written comments no later than 30 
days after the date of publication of these preliminary results of 
review.\43\ Parties that submit comments are requested to submit with 
each argument a statement of the issue and a brief summary of the 
argument. Rebuttal comments must be limited to the issues raised in the 
written comments and may be filed no later than five days after the 
deadline for filing case briefs.\44\ Parties submitting written 
comments or rebuttals are requested to provide the Department

[[Page 55574]]

with an additional copy of those comments on disk. Any interested party 
may request a hearing within 30 days of publication of these 
preliminary results.\45\ Any hearing, if requested, ordinarily will be 
held two days after the scheduled date for submission of rebuttal 
briefs.\46\ Parties should confirm by telephone the date, time, and 
location of the hearing two days before the scheduled date.
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    \43\ See 19 CFR 351.309(c)(1)(ii).
    \44\ See 19 CFR 351.309(d).
    \45\ See 19 CFR 351.310(c).
    \46\ See 19 CFR 351.310(d).
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    The Department will issue the final results of the administrative 
review, which will include the results of its analysis of issues raised 
in the briefs, within 120 days of publication of these preliminary 
results, in accordance with 19 CFR 351.213(h)(1) unless the time limit 
is extended.

Assessment Rates

    Pursuant to 19 CFR 351.212, the Department will determine, and CBP 
shall assess, antidumping duties on all appropriate entries of subject 
merchandise in accordance with the final results of this review. For 
assessment purposes, in accordance with 19 CFR 351.212(b)(1), the 
Department calculated exporter/importer (or customer)-specific 
assessment rates for merchandise subject to this review. Where the 
respondent has reported reliable entered values, the Department 
calculated importer (or customer)-specific ad valorem rates by 
aggregating the dumping margins calculated for all U.S. sales to each 
importer (or customer) and dividing this amount by the total entered 
value of the sales to each importer (or customer). See 19 CFR 
351.212(b)(1). Where an importer (or customer)-specific ad valorem rate 
is greater than de minimis, we will apply the assessment rate to the 
entered value of the importer's/customer's entries during the POR. See 
19 CFR 351.212(b)(1).
    Where we do not have entered values for all U.S. sales, the 
Department calculated a per-unit assessment rate by aggregating the 
antidumping duties due for all U.S. sales to each importer (or 
customer) and dividing this amount by the total quantity sold to that 
importer (or customer). To determine whether the duty assessment rates 
are de minimis, in accordance with the requirement set forth in 19 CFR 
351.106(c)(2), we calculated importer (or customer)-specific ad valorem 
ratios based on the estimated entered value. Where an importer (or 
customer)-specific ad valorem rate is zero or de minimis (i.e., less 
than 0.50 percent), the Department will instruct CBP to liquidate that 
importer's (or customer's) entries of subject merchandise without 
regard to antidumping duties. See 19 CFR 351.106(c)(2).
    The Department intends to issue appropriate assessment instructions 
directly to CBP 15 days after publication of the final results of this 
review. The Department intends to instruct CBP to liquidate entries 
containing subject merchandise exported by the PRC-wide entity at the 
PRC-wide rate in the final results of this review.

Cash Deposit Requirements

    The following cash deposit requirements will be effective upon 
publication of the final results of this review for shipments of 
subject merchandise from the PRC entered, or withdrawn from warehouse, 
for consumption on or after the publication date, as provided by 
sections 751(a)(1) and (a)(2)(C) of the Act: (1) For the exporter 
listed above, the cash deposit rate will be that established in the 
final results of this review (except, if the rate is zero or de 
minimis, i.e., less than 0.5 percent, no cash deposit will be required 
for that company); (2) for previously investigated or reviewed PRC and 
non-PRC exporters not listed above that have separate rates, the cash 
deposit rate will continue to be the exporter-specific rate published 
for the most recent period; (3) for all PRC exporters of subject 
merchandise that have not been found to be entitled to a separate rate, 
the cash deposit rate will be the PRC-wide rate of 91.73 percent; and 
(4) for all non-PRC exporters of subject merchandise which have not 
received their own rate, the cash deposit rate will be the rate 
applicable to the PRC exporters that supplied that non-PRC exporter. 
These deposit requirements, when imposed, shall remain in effect until 
further notice.

Notification to Importers

    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f) 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 determination is issued and published in accordance with 
section 777(i)(1) of the Act and 19 CFR 351.221(b)(4).

    Dated: September 3, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2010-22778 Filed 9-10-10; 8:45 am]
BILLING CODE 3510-DS-P