Certain New Pneumatic Off-the-Road Tires From the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review, 64259-64268 [2010-26193]

Download as PDF Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices Dated: October 14, 2010. Yvette Springer, Committee Liaison Officer. [FR Doc. 2010–26295 Filed 10–18–10; 8:45 am] BILLING CODE 3510–JT–P DEPARTMENT OF COMMERCE International Trade Administration [A–570–912] Certain New Pneumatic Off-the-Road Tires From the People’s Republic of China: Preliminary Results of Antidumping Duty Administrative Review Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce (‘‘the Department’’) is conducting an administrative review of the antidumping duty order on certain new pneumatic off-the-road tires (‘‘OTR tires’’) from the People’s Republic of China (‘‘PRC’’) covering the period February 20, 2008, through August 31, 2009. The administrative review (‘‘AR’’) covers six exporters. We have preliminarily determined that certain exporters who participated fully and are entitled to a separate rate sold subject merchandise to the United States at prices below normal value (‘‘NV’’) during the period of review (‘‘POR’’). If these preliminary results are adopted in our final results of review, we will instruct U.S. Customs and Border Protection (‘‘CBP’’) to assess antidumping duties on entries of subject merchandise during the POR for which the importer-specific assessment rates are above de minimis. We invite interested parties to comment on these preliminary results. We intend to issue the final results no later than 120 days from the date of publication of this notice, pursuant to section 751(a)(3)(A) of the Tariff Act of 1930, as amended (‘‘the Act’’). DATES: Effective Date: October 19, 2010. FOR FURTHER INFORMATION CONTACT: Raquel Silva or Lilit Astvatsatrian, AD/ CVD Operations, Office 8, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482–6475 or (202) 482– 6412, respectively. SUPPLEMENTARY INFORMATION: mstockstill on DSKH9S0YB1PROD with NOTICES AGENCY: Background On September 4, 2008, the Department published the antidumping duty order on OTR Tires from the PRC. VerDate Mar<15>2010 18:35 Oct 18, 2010 Jkt 223001 See Certain New Pneumatic Off-theRoad Tires From the People’s Republic of China: Notice of Amended Final Affirmative Determination of Sales at Less Than Fair Value and Antidumping Duty Order, 73 FR 51624 (September 4, 2008). On September 1, 2009, the Department published a notice of opportunity to request an administrative review of this order for the February 20, 2008, through, August 31, 2009, POR (hereinafter referred to as the 2008–2009 review). See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 74 FR 45179 (September 1, 2009). In accordance with 19 CFR 351.213(b), interested parties made requests for review between September 23, 2009, and September 30, 2009, on fifteen exporters. On October 26, 2009, the Department initiated the 2008–2009 review.1 GPX International Tire Corporation (‘‘GPX’’) requested that the Department conduct a review of exports of eight of the fifteen exporters. On November 20, 2009, GPX withdrew its review request for seven of the eight exporters for which it requested review, but maintained its request that the Department conduct a review of Hebei Starbright Tire Co., Ltd. (‘‘Starbright’’). On January 22, 2010, the Department selected Starbright and TUTRIC as mandatory respondents. Between November 24, 2009, and February 24, 2010, three more parties withdrew their respective review requests related to these same exporters, including TUTRIC. On May 21, 2010, the Department rescinded the administrative reviews of OTR tires with respect to TUTRIC and seven additional exporters because all parties requesting reviews of these entities had withdrawn their respective requests.2 1 See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Request for Revocation in Part, 74 FR 54956, 54958 (October 26, 2009) (‘‘Initiation Notice’’). The Department initiated reviews of (1) Aeolus Tyre Co., Ltd. (‘‘Aeolus’’), (2) Guizhou Tire Co., Ltd. (‘‘GTC’’), (3) Hanghzou Zhongce Rubber Co., Ltd. (‘‘Hangzhou Zhongce’’), (4) Starbright, (5) Innova Rubber Co., Ltd. (‘‘Innova’’), (6) Jiangsu Feichi Co., Ltd. (‘‘Feichi’’), (7) KS Holding Limited/KS Resources Limited (‘‘KS Ltd.’’), (8) Laizhou Xiongying Rubber Industry Co., Ltd. (Laizhou Xiongying’’), (9) Qingdao Free Trade Zone Full-World International Trading Co. (‘‘Full World’’), Ltd., (10) Qingdao Taifa Group Co., Ltd. (Qingdao Taifa’’), (11) Shandong Huitong Tyre Co., Ltd. (‘‘Huitong’’), (12) Tianjin Wanda Tyre Group (Wanda’’), (13) Tianjin United Tire & Rubber International Co., Ltd. (‘‘TUTRIC’’), (14) Triangle Tyre Co., Ltd. (‘‘Triangle’’), and (15) Weihai Zhongwei Rubber Co., Ltd. (‘‘Weihai Zhongwei’’). 2 See New Pneumatic Off-the-Road Tires From the People’s Republic of China: Notice of Partial Rescission of Antidumping Duty Administrative Review, 75 FR 28567 (May 21, 2010). In addition PO 00000 Frm 00017 Fmt 4703 Sfmt 4703 64259 On January 28, 2010, Hanify & King, bankruptcy counsel to GPX, informed the Department of GPX’s filing of a Chapter 11 petition under the United States Bankruptcy Code on October 26, 2009, which counsel claimed automatically stayed the Department’s administrative proceedings with respect to GPX. On February 3, 2010, both domestic interested parties 3 submitted letters to the Department expressing concerns about the effect of GPX’s bankruptcy petition on the ongoing administrative review. In response to parties’ concerns, the Department extended regulatory deadlines for Titan and Bridgestone until resolution of those concerns. On February 12, 2010, as a result of Government closures during snowstorms, Import Administration tolled all deadlines by one calendar week. See Memorandum from DAS for Import Administration, ‘‘Tolling of Administrative Deadlines As A Result of the Government Closure During the Recent Snowstorm,’’ dated February 12, 2010, available at http:// ia.ita.doc.gov/ia-highlights-andnews.html. On May 5, 2010, upon resolution of issues related to GPX’s bankruptcy petition, the Department extended the deadlines for (1) Verification requests, (2) factual information submissions, (3) comments on surrogate country selection, and (4) submission of publicly available information for valuing factors of production. On May 5, 2010, the Department selected Qingdao Free Trade Zone Full World International Trading Co., Ltd. (‘‘Full-World’’) as the mandatory respondent to replace TUTRIC. On May 26, 2010, Full-World withdrew its request for an administrative review of its exports. On August 4, 2010, the Department published in the Federal Register a notice rescinding the administrative review of OTR tires with respect to Full-World.4 On June 7, 2010, the Department published in the Federal Register a notice fully extending the time limit for the preliminary results of this review to October 7, 2010. See New Pneumatic Off-the-Road Tires from the People’s Republic of China: Extension of Preliminary Results of Antidumping to TUTRIC, the Department rescinded the reviews of Aeolus, Feichi, GTC, Huitong, Innova, Triangle and Wanda. 3 Titan Tire Corporation (‘‘Titan’’), and Bridgestone Americas, Inc., and Bridgestone Americas Tire Operations, LLC (collectively ‘‘Bridgestone’’), both domestic producers of the like product. 4 See New Pneumatic Off-the-Road Tires from the People’s Republic of China: Notice of Partial Rescission of Antidumping Duty Administrative Review, 75 FR 46917 (August 4, 2010). E:\FR\FM\19OCN1.SGM 19OCN1 64260 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices Duty Administrative Review, 75 FR 32158 (June 7, 2010). On July 23, 2010, and July 29, 2010, parties submitted comments on surrogate country selection. On July 29, 2010, parties submitted comments on surrogate values. On August 10, 2010, parties submitted rebuttal comments on surrogate values. Between January 22, 2010, and September 1, 2010, the Department issued to Starbright the original antidumping questionnaire, and six supplemental questionnaires. Between February 24, 2010, and September 10, 2010, Starbright submitted timely responses to the Department’s seven questionnaires. Period of Review The POR is February 20, 2008, through August 31, 2009. mstockstill on DSKH9S0YB1PROD with NOTICES Scope of Order The products covered by the order are new pneumatic tires designed for offthe-road and off-highway use, subject to exceptions identified below. Certain OTR tires are generally designed, manufactured and offered for sale for use on off-road or off-highway surfaces, including but not limited to, agricultural fields, forests, construction sites, factory and warehouse interiors, airport tarmacs, ports and harbors, mines, quarries, gravel yards, and steel mills. The vehicles and equipment for which certain OTR tires are designed for use include, but are not limited to: (1) Agricultural and forestry vehicles and equipment, including agricultural tractors,5 combine harvesters,6 agricultural high clearance sprayers,7 industrial tractors,8 log-skidders,9 agricultural implements, highwaytowed implements, agricultural logging, and agricultural, industrial, skid-steers/ mini-loaders; 10 (2) construction vehicles and equipment, including earthmover articulated dump products, 5 Agricultural tractors are dual-axle vehicles that typically are designed to pull farming equipment in the field and that may have front tires of a different size than the rear tires. 6 Combine harvesters are used to harvest crops such as corn or wheat. 7 Agricultural sprayers are used to irrigate agricultural fields. 8 Industrial tractors are dual-axle vehicles that typically are designed to pull industrial equipment and that may have front tires of a different size than the rear tires. 9 A log-skidder has a grappling lift arm that is used to grasp, lift and move trees that have been cut down to a truck or trailer for transport to a mill or other destination. 10 Skid-steer loaders are four-wheel drive vehicles with the left-side drive wheels independent of the right-side drive wheels and lift arms that lie alongside the driver with the major pivot points behind the driver’s shoulders. Skid-steer loaders are used in agricultural, construction and industrial settings. VerDate Mar<15>2010 16:24 Oct 18, 2010 Jkt 223001 rigid frame haul trucks,11 front end loaders,12 dozers,13 lift trucks, straddle carriers,14 graders,15 mobile cranes,16 compactors; and (3) industrial vehicles and equipment, including smooth floor, industrial, mining, counterbalanced lift trucks, industrial and mining vehicles other than smooth floor, skid-steers/ mini-loaders, and smooth floor off-theroad counterbalanced lift trucks.17 The foregoing list of vehicles and equipment generally have in common that they are used for hauling, towing, lifting, and/or loading a wide variety of equipment and materials in agricultural, construction and industrial settings. Such vehicles and equipment, and the descriptions contained in the footnotes are illustrative of the types of vehicles and equipment that use certain OTR tires, but are not necessarily all-inclusive. While the physical characteristics of certain OTR tires will vary depending on the specific applications and conditions for which the tires are designed (e.g., tread pattern and depth), all of the tires within the scope have in common that they are designed for offroad and off-highway use. Except as discussed below, OTR tires included in the scope of the order range in size (rim diameter) generally but not exclusively from 8 inches to 54 inches. The tires may be either tube-type 18 or tubeless, radial or non-radial, and intended for sale either to original equipment manufacturers or the replacement market. The subject merchandise is currently classifiable under Harmonized Tariff Schedule of the United States (‘‘HTSUS’’) subheadings: 4011.20.10.25, 4011.20.10.35, 4011.20.50.30, 4011.20.50.50, 4011.61.00.00, 4011.62.00.00, 4011.63.00.00, 4011.69.00.00, 4011.92.00.00, 4011.93.40.00, 4011.93.80.00, 4011.94.40.00, and 4011.94.80.00. While HTSUS subheadings are provided for convenience and customs purposes, our written description of the scope is dispositive. Specifically excluded from the scope are new pneumatic tires designed, manufactured and offered for sale primarily for on-highway or on-road use, including passenger cars, race cars, station wagons, sport utility vehicles, minivans, mobile homes, motorcycles, bicycles, on-road or on-highway trailers, light trucks, and trucks and buses. Such tires generally have in common that the symbol ‘‘DOT’’ must appear on the sidewall, certifying that the tire conforms to applicable motor vehicle safety standards. Such excluded tires may also have the following designations that are used by the Tire and Rim Association: 11 Haul trucks, which may be either rigid frame or articulated (i.e., able to bend in the middle) are typically used in mines, quarries and construction sites to haul soil, aggregate, mined ore, or debris. 12 Front loaders have lift arms in front of the vehicle. They can scrape material from one location to another, carry material in their buckets, or load material into a truck or trailer. 13 A dozer is a large four-wheeled vehicle with a dozer blade that is used to push large quantities of soil, sand, rubble, etc., typically around construction sites. They can also be used to perform ‘‘rough grading’’ in road construction. 14 A straddle carrier is a rigid frame, enginepowered machine that is used to load and offload containers from container vessels and load them onto (or off of) tractor trailers. 15 A grader is a vehicle with a large blade used to create a flat surface. Graders are typically used to perform ‘‘finish grading.’’ Graders are commonly used in maintenance of unpaved roads and road construction to prepare the base course on to which asphalt or other paving material will be laid. 16 I.e., ‘‘on-site’’ mobile cranes designed for offhighway use. 17 A counterbalanced lift truck is a rigid framed, engine-powered machine with lift arms that has additional weight incorporated into the back of the machine to offset or counterbalance the weight of loads that it lifts so as to prevent the vehicle from overturning. An example of a counterbalanced lift truck is a counterbalanced fork lift truck. Counterbalanced lift trucks may be designed for use on smooth floor surfaces, such as a factory or warehouse, or other surfaces, such as construction sites, mines, etc. 18 While tube-type tires are subject to the scope of this proceeding, tubes and flaps are not subject merchandise and therefore are not covered by the scope of this proceeding, regardless of the manner in which they are sold (e.g., sold with or separately from subject merchandise). Prefix Letter Designations • P—Identifies a tire intended primarily for service on passenger cars; • LT—Identifies a tire intended primarily for service on light trucks; and, • ST—Identifies a special tire for trailers in highway service. PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 Suffix Letter Designations • TR—Identifies a tire for service on trucks, buses, and other vehicles with rims having specified rim diameter of nominal plus 0.156″ or plus 0.250″ • MH—Identifies tires for Mobile Homes; • HC—Identifies a heavy duty tire designated for use on ‘‘HC’’ 15’’ tapered rims used on trucks, buses, and other vehicles. This suffix is intended to differentiate among tires for light trucks, and other vehicles or other services, which use a similar designation. • Example: 8R17.5 LT, 8R17.5 HC; • LT—Identifies light truck tires for service on trucks, buses, trailers, and multipurpose passenger vehicles used in nominal highway service; and • MC—Identifies tires and rims for motorcycles. The following types of tires are also excluded from the scope: Pneumatic tires that are not new, including recycled or retreaded tires and used E:\FR\FM\19OCN1.SGM 19OCN1 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices tires; non-pneumatic tires, including solid rubber tires; tires of a kind designed for use on aircraft, all-terrain vehicles, and vehicles for turf, lawn and garden, golf and trailer applications. Also excluded from the scope are radial and bias tires of a kind designed for use in mining and construction vehicles and equipment that have a rim diameter equal to or exceeding 39 inches. Such tires may be distinguished from other tires of similar size by the number of plies that the construction and mining tires contain (minimum of 16) and the weight of such tires (minimum 1500 pounds). mstockstill on DSKH9S0YB1PROD with NOTICES Non-Market Economy Country Status No party contested the Department’s treatment of the PRC as a non-market economy (‘‘NME’’) country, and the Department has treated the PRC as an NME country in all past antidumping duty investigations and administrative reviews.19 No interested party in this case has argued that we should do otherwise. Designation as an NME country remains in effect until it is revoked by the Department. See section 771(18)(C)(i) of the Act. As such, we continue to treat the PRC as an NME in this proceeding. Surrogate Country Section 773(c)(1) of the Act directs the Department to base NV on the NME producer’s factors of production (‘‘FOPs’’), valued in a surrogate market economy (‘‘ME’’) 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 use, to the extent possible, the prices or costs of the FOPs in one or more ME countries that are: (1) At a level of economic development comparable to that of the NME country; and (2) significant producers of comparable merchandise. The sources of the surrogate factor values are discussed under the ‘‘Normal Value’’ section below. See Memorandum to The File, ‘‘Preliminary Results of the 2008–2009 Administrative Review of New Pneumatic Off-the-Road Tires from the People’s Republic of China: Surrogate Value Memorandum,’’ dated concurrently with this notice (‘‘Surrogate Value Memorandum’’). The Department determined that India, Indonesia, Ukraine, Peru, the 19 See, e.g., Chlorinated Isocyanurates from the People’s Republic of China: Final Results of Antidumping Duty Administrative Review, 73 FR 52645 (September 10, 2008); see also Folding Metal Tables and Chairs from the People’s Republic of China: Final Results of Antidumping Duty Administrative Review, 74 FR 3560 (January 21, 2009). VerDate Mar<15>2010 16:24 Oct 18, 2010 Jkt 223001 Philippines and Thailand are countries comparable to the PRC in terms of economic development.20 Once we have identified the countries that are economically comparable to the PRC, we select 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. The Department has determined that India is the appropriate surrogate country for use in this review. The Department based its decision on the following facts: (1) India is at a level of economic development comparable to that of the PRC; (2) India is a significant producer of comparable merchandise; and (3) India provides the best opportunity to use quality, publicly available data to value the FOPs. Titan and Bridgestone provided comments on July 23, 2010, and July 29, 2010, respectively, arguing that India is the appropriate surrogate country for use in this review. Additionally, the data submitted by Titan, Bridgestone and Starbright for our consideration as potential surrogate values are sourced from India. Therefore, because India best represents the experience of producers of comparable merchandise operating in an ME, we have selected India as the surrogate country and, accordingly, have calculated NV using Indian prices to value the respondent’s FOPs, when available and appropriate. See Surrogate Value Memorandum. We have obtained and relied upon publicly available information wherever possible. Separate Rates In the Initiation Notice, the Department applied a process by which exporters and producers not being individually reviewed may obtain separate-rate status in NME reviews. The process requires exporters and producers to submit a separate-rate status application (‘‘SRA’’) or separaterate status certification (‘‘SRC’’).21 However, the standard for eligibility for a separate rate (which is whether a firm can demonstrate an absence of both de jure and de facto government control 20 See Memoranda to Wendy J. Frankel, Office Director, AD/CVD Operations, Office 8, ‘‘Request for a List of Surrogate Countries for an Administrative Review of the Antidumping Duty Order Covering New Pneumatic Off-the-Road Tires from the People’s Republic of China,’’ dated January 25, 2010. 21 See Policy Bulletin 05.1: Separate-Rates Practice and Application of Combination Rates in Antidumping Investigations involving Non-Market Economy Countries (April 5, 2005), available at http://ia.ita.doc.gov/policy/bull05-1.pdf. PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 64261 over its export activities) has not changed. From November 30 to December 2, 2009, six exporters of the subject merchandise filed timely responses to the Department’s SRAs or SRCs, as applicable.22 In proceedings involving NME countries, the Department has a rebuttable presumption that all companies within the country are subject to government control and, thus, should be assessed a single antidumping duty rate.23 It is the Department’s policy to assign all exporters of merchandise subject to review 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.24 Exporters can demonstrate this independence through the absence of both de jure and de facto government control over export activities. The Department analyzes each entity exporting the subject merchandise under a test arising from the Notice of Final Determination of Sales at Less Than Fair Value: Sparklers from the People’s Republic of China, 56 FR 20588, at Comment 1 (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, 22587 (May 2, 1994) (‘‘Silicon Carbide’’). However, if the Department determines that a company is wholly foreign-owned or located in an ME, then an SRA analysis is not necessary to determine whether it is independent from government control.25 A. Separate-Rate Recipients 26 1. Wholly Foreign-Owned Starbright reported that during the POR it was wholly owned by GPX, a U.S. company, and KS Ltd. reported in its SRA that it is wholly-owned by a company located in Hong Kong. Therefore, consistent with the 22 Hangzou Zhongce; Starbright; KS Ltd.; Laizhou Xiongying; Qingdao Taifa; and Weihai Zhongwei. 23 See, e.g., Certain Coated Paper Suitable for High-Quality Print Graphics Using Sheet-Fed Presses From the People’s Republic of China: Notice of Preliminary Determination of Sales at Less Than Fair Value and Postponement of Final Determination, 75 FR 24892, 24899 (May 6, 2010) (unchanged in Certain Coated Paper Suitable for High-Quality Print Graphics Using Sheet-Fed Presses From the People’s Republic of China: Final Determination of Sales at Less Than Fair Value, 75 FR 59217 (September 27, 2010)). 24 Id. 25 See, e.g., Final Results of Antidumping Duty Administrative Review: Petroleum Wax Candles From the People’s Republic of China, 72 FR 52355, 52356 (September 13, 2007). 26 All separate-rate applicants receiving a separate rate are hereby referred to collectively as the ‘‘SR Recipients;’’ this includes the mandatory respondent. E:\FR\FM\19OCN1.SGM 19OCN1 64262 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices Department’s practice, a further SRA analysis is not necessary to determine whether Starbright’s and KS Ltd.’s export activities are independent from government control, and we have preliminarily granted a separate rate to Starbright and KS Ltd.27 2. Wholly Chinese-Owned Companies Hangzhou Zhongce, Laizhou Xiongying, Qingdao Taifa, and Weihai Zhongwei stated that they are wholly Chinese-owned companies (collectively ‘‘PRC SR Applicants’’). Therefore, the Department must analyze whether these respondents can demonstrate the absence of both de jure and de facto governmental control over 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 licenses; (2) any legislative enactments decentralizing control of companies; and (3) other formal measures by the government decentralizing control of companies.28 The evidence provided by the PRC SR Recipients 29 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 exporters’ business and export licenses; (2) there are applicable legislative enactments decentralizing control of the companies; and (3) there are formal measures by the government decentralizing control of companies. mstockstill on DSKH9S0YB1PROD with NOTICES 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 making decisions regarding the selection of management; and (4) whether the respondent retains the 27 See, e.g., Notice of Final Determination of Sales at Less Than Fair Value: Creatine Monohydrate from the People’s Republic of China, 64 FR 71104, 71104–05 (December 20, 1999) (where the respondent was wholly foreign-owned and, thus, qualified for a separate rate). 28 See Sparklers, 56 FR at 20589. 29 Collective reference for all respondents receiving a separate rate in this administrative review. VerDate Mar<15>2010 16:24 Oct 18, 2010 Jkt 223001 proceeds of its export sales and makes independent decisions regarding disposition of profits or financing of losses.30 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. The evidence placed on the record of this review by the PRC SR Recipients demonstrates an absence of de jure and de facto government control with respect to each of the exporters’ exports of the merchandise under consideration, in accordance with the criteria identified in Sparklers and Silicon Carbide. Rate for Non-Selected Companies The statute and the Department’s regulations do not address the establishment of a rate to be applied to individual companies not selected for examination where the Department limited its examination in an administrative review pursuant to section 777A(c)(2) of the Act. Generally, we have looked to section 735(c)(5) of the Act, which provides instructions for calculating the all-others rate in an investigation, for guidance when calculating the rate for respondents we did not examine in an administrative review. For the exporters subject to a review that were determined to be eligible for separate rate status, but were not selected as mandatory respondents, the Department generally weightaverages the rates calculated for the mandatory respondents, excluding any rates that are zero, de minimis, or based entirely on FA.31 For this administrative review, the Department has calculated a positive margin for the single mandatory respondent, Starbright. Accordingly, for these preliminary results, consistent with our practice, the Department has preliminarily established a margin for the SR Recipients based on the rate calculated for the single mandatory respondent, Starbright. 30 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). 31 See, e.g., Wooden Bedroom Furniture from the People’s Republic of China: Preliminary Results of Antidumping Duty Administrative Review, Preliminary Results of New Shipper Review and Partial Rescission of Administrative Review, 73 FR 8273, 8279 (February 13, 2008) (unchanged in Wooden Bedroom Furniture from the People’s Republic of China: Final Results of Antidumping Duty Administrative Review and New Shipper Review, 73 FR 49162 (August 20, 2008)). PO 00000 Frm 00020 Fmt 4703 Sfmt 4703 Date of Sale Section 401(i) of the Department’s regulations states that: In identifying the date of sale of the subject merchandise or foreign like product, the Secretary normally will use the date of invoice, as recorded in the exporter or producer’s records kept in the ordinary course of business. However, the Secretary may use a date other than the date of invoice if the Secretary is satisfied that a different date better reflects the date on which the exporter or producer establishes the material terms of sale. See also Allied Tube and Conduit Corp. v. United States, 132 F. Supp. 2d 1087, 1090–1092 (CIT 2001) (upholding the Department’s rebuttable presumption that invoice date is the appropriate date of sale). After examining the questionnaire responses and the sales documentation placed on the record by Starbright, we preliminarily determine that invoice date is the most appropriate date of sale for Starbright. Nothing on the record rebuts the presumption that invoice date should be the date of sale. Normal Value Comparisons To determine whether Starbright’s sales of OTR tires to the United States were made at less than NV, we compared constructed export price (‘‘CEP’’) to NV, as described in the ‘‘Constructed Export Price,’’ and ‘‘Normal Value’’ sections of this notice, pursuant to section 771(35) of the Act. Constructed Export Price 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. In accordance with section 772(b) of the Act, we used CEP for Starbright’s sales because the sales were made by GPX, Starbright’s U.S. affiliate in the United States. We calculated CEP based on delivered prices to unaffiliated purchasers in the United States. In accordance with section 772(d)(1) of the Act, we made deductions from the starting price for billing adjustments, movement expenses, discounts and rebates, and selling expenses in the U.S. market. We made deductions from the U.S. sales price for movement expenses in accordance with section 772(c)(2)(A) of the Act. These included, where applicable, foreign inland freight and insurance from the plant to the port of E:\FR\FM\19OCN1.SGM 19OCN1 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices exportation, foreign inland insurance, ocean freight, marine insurance, U.S. Customs duty, U.S. brokerage and handling, U.S. inland freight from port to the warehouse, warehousing expense and U.S. inland freight from the warehouse to the customer. In accordance with section 772(d)(1) of the Act, the Department deducted, where applicable, commissions, credit expenses, warranty expenses, inventory carrying costs and indirect selling expenses from the U.S. price, all of which relate to commercial activity in the United States. In calculating its reported indirect selling expenses, the company did not include a significant number of items that it later claimed should be excluded; however, it did not provide any substantiation for this claim. Accordingly, for purposes of these preliminary results of review, we have included these items in the indirect selling expense adjustment to U.S. price.32 Further, we did not grant an offset to interest expenses for shortterm interest income because Starbright did not demonstrate that any of GPX’s interest income was generated from short-term assets. However, we will issue a post-preliminary supplemental questionnaire to Starbright requesting that it provide substantiating documentation for its claim that all of its originally excluded items should be excluded from indirect selling expenses, and provide Starbright an opportunity to provide evidence that any of GPX’s interest income was short term in nature. In addition, we deducted CEP profit in accordance with sections 772(d)(3) and 772(f) of the Act. In accordance with section 772(d) of the Act, we calculated Starbright’s credit expenses and inventory carrying costs based on the actual short-term interest rate reported for loans obtained by GPX during the POR.33 mstockstill on DSKH9S0YB1PROD with NOTICES Normal Value Section 773(c)(1) of the Act provides that, in the case of an NME, 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. 32 See Memorandum to the File, ‘‘Certain New Pneumatic Off-The-Road Tires from the People’s Republic of China: Analysis Memorandum for the Preliminary Determination: Hebei Starbright Tire Co., Ltd. (‘Starbright’),’’ dated October 7, 2010 (‘Starbright Preliminary Analysis Memorandum’’). 33 See Starbright Preliminary Analysis Memorandum. VerDate Mar<15>2010 16:24 Oct 18, 2010 Jkt 223001 The Department bases NV on FOPs because the presence of government controls on various aspects of NME economies renders price comparisons and the calculation of production costs invalid under our normal methodologies. Therefore, in these preliminary results, we have calculated NV based on FOPs in accordance with sections 773(c)(3) and (4) of the Act and 19 CFR 351.408(c). The FOPs include: (1) Hours of labor required; (2) quantities of raw materials employed; (3) amounts of energy and other utilities consumed; and (4) representative capital costs. In accordance with 19 CFR 351.408(c)(1), the Department normally uses publicly available information to value the FOPs. However, when a producer sources a meaningful amount of an input from an ME country and pays for it in ME currency, the Department may value the factor using the actual price paid for the input.34 Further, the Department disregards prices it has reason to suspect may be subsidized.35 In accordance with the legislative history of the Omnibus Trade and Competitiveness Act of 1988, the Department continues to apply its longstanding practice of disregarding surrogate values if it has a reason to believe or suspect the source data may be subsidized.36 In this regard, the Department has previously found that it is appropriate to disregard such prices from India, Indonesia, South Korea and Thailand because we have determined that these countries maintain broadly available, non-industry specific export subsidies.37 Based on the existence of 34 See 19 CFR 351.408(c)(1); see also Lasko Metal Products v. United States, 43 F.3d 1442, 1445–1446 (Fed. Cir. 1994) (affirming the Department’s use of market-based prices to value certain FOPs). 35 See, e.g., China National Machinery Import & Export Corp. v. United States, 293 F. Supp. 2d 1334, 1339 (CIT 2003) (aff’d, 104 Fed. Appx. 183 (Fed. Cir. 2004)) (‘‘China National Machinery’’), and see Frontseating Service Valves from the People’s Republic of China; Preliminary Determination of Sales at Less Than Fair Value, Preliminary Negative Determination of Critical Circumstances, and Postponement of Final Determination, 73 FR 62952 (October 22, 2008) (unchanged in Frontseating Service Valves from the People’s Republic of China: Final Determination of Sales at Less Than Fair Value and Final Negative Determination of Critical Circumstances, 74 FR 10886 (March 13, 2009)) (‘‘Frontseating Service Valves’’). 36 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. 37 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 pages 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 PO 00000 Frm 00021 Fmt 4703 Sfmt 4703 64263 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 India, Indonesia, South Korea and Thailand may have benefitted from these subsidies. Factor Valuations In accordance with section 773(c) of the Act, we calculated NV based on the FOPs reported by Starbright for the POR. To calculate NV, we multiplied the reported per-unit factor quantities by publicly available Indian surrogate values (except as noted below). In selecting the surrogate values, we considered the quality, specificity, public availability, and contemporaneity of the data. As appropriate, we adjusted input prices by including freight costs to render them delivered prices. Specifically, we added to Indian import surrogate values 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 (i.e., where the sales terms for the ME inputs were not delivered to the factory). This adjustment is in accordance with the decision of the Federal Circuit in Sigma Corp. v. United States, 117 F. 3d 1401, 1408 (Fed. Cir. 1997). For a detailed description of all surrogate values used for Starbright, see the Surrogate Value Memorandum. 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’’).38 However, in October 2009, the Department learned that Indian import data obtained from the WTA, as published by GTIS, began identifying the original reporting currency for India as the U.S. Dollar. The Department then contacted GTIS about the change in the original page 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 pages 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 page 23. 38 See 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) (unchanged in Certain Preserved Mushrooms From the People’s Republic of China: Final Results of Antidumping Duty New Shipper Review, 74 FR 65520 (December 10, 2009)). E:\FR\FM\19OCN1.SGM 19OCN1 64264 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES reporting currency for India from the Indian Rupee to the U.S. Dollar. Officials at GTIS explained that while GTIS obtains data on imports into India directly from the Ministry of Commerce, Government of India, as denominated and published in Indian Rupees, the WTA software is limited with regard to the number of significant digits it can manage. Therefore, 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 significant digits when obtaining data through the WTA software. GTIS explained that it converts the Indian Rupee to the U.S. Dollar using the monthly Federal Reserve exchange rate applicable to the relevant month of the data being downloaded and converted.39 However, the data reported in the Global Trade Atlas (‘‘GTA’’) software published by GTIS reports import statistics, such as from India, in the original reporting currency and, thus, these data correspond to the original currency value reported by each country. Additionally, the data reported in the GTA software are 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 Department will now obtain import statistics from GTA for valuing various FOPs because the GTA import statistics 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. We further adjusted material input values to account for freight costs incurred between the supplier and respondent. We used the freight rates published by http://www.infobanc.com, ‘‘The Great Indian Bazaar, Gateway to Overseas Markets.’’ The logistics section of the website contains inland freight truck rates between many large Indian cities. The truck freight rates are for the period August 2008 through July 2009. See Surrogate Value Memorandum. Starbright made raw materials purchases from ME suppliers. Therefore, in accordance with our practice outlined in Antidumping Methodologies: Market Economy Inputs,40 where at least 33 percent of an 39 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. 40 See Antidumping Methodologies: Market Economy Inputs, Expected Non-Market Economy Wages, Duty Drawback; and Request for Comments, VerDate Mar<15>2010 16:24 Oct 18, 2010 Jkt 223001 input is sourced from ME suppliers and purchased in an ME currency, the Department used actual weightedaverage purchase prices to value these inputs.41 Where the quantity of the input purchased from ME suppliers during the period is below 33 percent of the total volume of purchases of the input during the period, the Department weight-averaged the weighted average ME purchase price with an appropriate surrogate value.42 See Antidumping Methodologies: Market Economy Inputs. For a complete description of the factor values we used, see the Surrogate Value Memorandum and the Starbright Preliminary Analysis Memorandum. Where we could not obtain publicly available information contemporaneous with the POR with which to value FOPs, we adjusted the surrogate values using, where appropriate, the Indian Wholesale Price Index (‘‘WPI’’) as published in the International Financial Statistics of the International Monetary Fund (‘‘IMF’’). To value electricity, we used 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 taxexclusive 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. See Surrogate Value Memorandum. To value water, we used the revised Maharashtra Industrial Development Corporation (‘‘MIDC’’) water rates available at http://www.midcindia.com/ water-supply. See Surrogate Value Memorandum. The Department valued brokerage and handling 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 transport in India that is published in Doing 71 FR 61716, 61717–19 (October 19, 2006) (‘‘Antidumping Methodologies: Market Economy Inputs’’). 41 For a detailed description of all actual values used for market-economy inputs, see New-Tec Preliminary Analysis Memorandum dated concurrently with this notice. 42 We did not accept all of Starbright’s claimed market economy purchases; however due to the proprietary nature of this issue, please see further discussion in the Starbright Preliminary Analysis Memorandum. PO 00000 Frm 00022 Fmt 4703 Sfmt 4703 Business 2010: India, published by the World Bank. See Surrogate Value Memorandum. To value steam coal, we used data obtained for grades A and B coal reported in the December 2007 Coal India Limited Circular. See Surrogate Value Memorandum. To value warehousing, the Department used values obtained from the Board of Jawaharlal Nehru Port Trust’s Web site,43 a source identified and used in the less-than-fair-value investigation of this proceeding. See Certain New Pneumatic Off-the-Road Tires From the People’s Republic of China: Notice of Amended Final Affirmative Determination of Sales at Less Than Fair Value and Antidumping Duty Order, 73 FR 51624 (Sept. 4, 2008), and accompanying Issues and Decision Memorandum at Comment 26. We applied these values to the average number of days that Starbright’s subject merchandise is in inventory. See Surrogate Value Memorandum. As a consequence of the decision of the Court of Appeals for the Federal Circuit (‘‘Federal Circuit’’) in Dorbest Ltd. v. United States, 604 F. 3d 1363 (Fed. Cir. 2010), the Department is no longer relying on the regression-based wage rate described in 19 CFR 351.408(c)(3). The Department is continuing to evaluate options for determining labor values in light of the recent Federal Circuit decision. For these preliminary results, we have calculated an hourly wage rate to use in valuing the reported labor input by averaging earnings and/or wages in countries that are economically comparable to the PRC and that are significant producers of comparable merchandise. To calculate the hourly wage data, we used wage rate data reported by the International Labor Organization (‘‘ILO’’). Because an industry-specific dataset relevant to this proceeding exists within the Department’s preferred ILO source, we will be using industry-specific data to calculate a surrogate wage rate for this review, in accordance with section 773(c)(1) of the Act. For this review, the Department has calculated the wage rate using a simple average of the data provided to the ILO under Sub-Classification 25 of the ISIC– Revision 44 3 standard by countries 43 http://www.jnport.gov.in/ CMSPage.aspx?PageID=27. 44 The ILO industry-specific data is reported according to the International Standard Industrial Classification of all Economic Activities (‘‘ISIC’’) code, which is maintained by the United Nations Statistical Division and is periodically updated. These updates are referred to as ‘‘Revisions.’’ The ILO, an organization under the auspices of the E:\FR\FM\19OCN1.SGM 19OCN1 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES determined to be both economically comparable and significant producers to the PRC. Specifically, the Department finds the two-digit description under ISIC–Revision 3 (‘‘Manufacture of Rubber and Plastics Products’’) to be the best available wage rate surrogate value on the record because it is specific and derived from industries that produce merchandise comparable to the subject merchandise. For further information on the calculation of the wage rate, see the Surrogate Value Memorandum. To value factory overhead, selling, general, and administrative expenses, and profit, we used audited financial statements for the year ending March 31, 2009, of Falcon Tyres Ltd., and TVS Srichakra Limited, and the financial statement for the year ending December 31, 2008, of Goodyear India Limited, Indian producers of comparable merchandise.45 For these preliminary results, the Department determined not to use audited financial statements of Govind Rubber Limited because the overwhelming amount of production is cycle tires and tubes, and auto tires and tubes accounted for less than 1 percent of production. Based upon that information, we find that Govind Rubber Limited does not produce comparable merchandise. In addition, the Department has declined to use audited financial statements of three other Indian producers, JK Industries Ltd., MRF Tyres Ltd. and Balkrishna Industries Limited, because there is evidence that each of these companies received subsidies under programs previously found by the Department to be countervailable.46 Nevertheless, the United Nation, utilizes this classification for reporting purposes. Currently, wage and earnings data are available from the ILO under the following revisions: ISIC–Rev.2, ISIC–Rev.3, and most recently, ISIC–Rev.4. The ISIC code establishes a two-digit breakout for each manufacturing category, and also often provides a three- or four-digit subcategory for each two-digit category. Depending on the country, data may be reported at either the two-, three- or four-digit subcategory. SubClassification 25 of the ISIC–Revision 3 covers ‘‘Manufacture of Rubber and Plastics Products’’. 45 See Surrogate Value Memorandum. 46 Specifically, JK Industries received subsidies under the Sales Tax Deferred from Government of Karnataka program (see page 40 of its financial statement), found by the Department to be countervailable. See Notice of Preliminary Results and Rescission, in Part, of Countervailing Duty Administrative Review: Polyethylene Terephthalate Film, Sheet, and Strip from India, 71 FR 45037 (August 8, 2006) (8/8/2006 PET Film). MRF Tyres received subsidies under the Export Promotion Capital Goods Scheme (see page 61 of its financial statement), found by the Department to be countervailable. See Final Affirmative Countervailing Duty Determination: Bottle-Grade Polyethylene Terephthalate (PET) Resin From India, 70 FR 13460 (March 21, 2005) (3/21/2005 PET Resin). Balkrishna Industries received subsidies under the Duty Entitlement Passbook Scheme (see page 32 of its financial statement), found by the VerDate Mar<15>2010 16:24 Oct 18, 2010 Jkt 223001 Department may consider other publicly available financial statements for the final results, as appropriate. In its original questionnaire response, Starbright stated that it does not produce any by-products, with the exception of a small amount of scrap tires. In a July 14, 2010, supplemental questionnaire, we requested that Starbright explain, as requested in the original questionnaire, the disposition of its by-products, and that it demonstrate the quantities of scrap product produced during the POR. In addition we asked Starbright to demonstrate that there is a commercial value to its claimed scrap through either sale, or the reintroduction into its production process. On August 17, 2010, Starbright provided a worksheet purportedly showing scrap production for July 2008; however it did not explain the worksheet or tie to any supporting documents. In this same response, Starbright also stated that it does not sell or reintroduce the scrap tires into production, but, if possible repaired and returned them to inventory. Because Starbright clearly and repeatedly stated that these scrap tires were neither sold nor re-used in production, but simply placed in inventory, it has not demonstrated that these scrap tires have any commercial value that would warrant a by-product offset. On September 1, 2010, the Department requested for the third time that Starbright provide documentation to demonstrate the production, sale, and/or reintroduction of its scrap tires by-product, whereupon, on September 13, 2010, Starbright stated that due to time and staffing constraints, it had not been able to prepare the requested information. Because Starbright reported that it produced scrap tires but did not report or demonstrate that it sold or reintroduced the scrap tires into production and thus did not demonstrate either the production or commercial value of any such scrap, we have not granted Starbright its claimed by-product offset for tire scrap. Adverse Facts Available Sections 776(a)(1) and (2) of the Act provide that the Department shall apply ‘‘facts otherwise available’’ if, inter alia, necessary information is not on the record or an interested party or any other person: (A) Withholds information that has been requested; (B) fails to provide information within the deadlines established, or in the form and manner requested by the Department, subject to subsections (c)(1) Department to be countervailable. See, e.g., 8/8/ 2006 PET Film and 3/21/2005 PET Resin. PO 00000 Frm 00023 Fmt 4703 Sfmt 4703 64265 and (e) of section 782 of the Act; (C) significantly impedes a proceeding; or (D) provides information that cannot be verified as provided by section 782(i) of the Act. Where the Department determines that a response to a request for information does not comply with the request, section 782(d) of the Act provides that the Department will so inform the party submitting the response and will, to the extent practicable, provide that party the opportunity to remedy or explain the deficiency. If the party fails to remedy the deficiency within the applicable time limits and subject to section 782(e) of the Act, the Department may disregard all or part of the original and subsequent responses, as appropriate. Section 782(e) of the Act provides that the Department ‘‘shall not decline to consider information that is submitted by an interested party and is necessary to the determination but does not meet all applicable requirements established by the administering authority’’ if the information is timely, can be verified, is not so incomplete that it cannot be used, and if the interested party acted to the best of its ability in providing the information. Where all of these conditions are met, the statute requires the Department to use the information if it can do so without undue difficulties. Section 776(b) of the Act further provides that the Department may use an adverse inference in applying the facts otherwise available when a party has failed to cooperate by not acting to the best of its ability to comply with a request for information. Section 776(b) of the Act also authorizes the Department to use as adverse facts available (‘‘AFA’’) information derived from the petition, the final determination, a previous administrative review, or other information placed on the record. For the reasons discussed below, we determine that, in accordance with sections 776(a)(2) and 776(b) of the Act, the use of partial AFA is appropriate for the preliminary results with respect to Starbright. 1. Products with Unreported Factors of Production The original questionnaire states: ‘‘if you sold some products/models during the POR but did not produce them during the POR * * * please contact the official in charge before preparing your response to this section of the questionnaire.’’ 47 However, in filing its 47 See Letter from the Department to Starbright, ‘‘Antidumping Duty Administrative Review of E:\FR\FM\19OCN1.SGM Continued 19OCN1 64266 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices mstockstill on DSKH9S0YB1PROD with NOTICES questionnaire response, Starbright included several products in the reported U.S. sales list in its response to section C of the questionnaire for which it failed to provide any factors of production in its response to section D.48 Furthermore, prior to submitting its response, Starbright never contacted the Department regarding this matter, despite the instructions in the questionnaire that it do so. On July 1, 2010, the Department issued a supplemental questionnaire in which it asked Starbright to explain the missing product control numbers, and to provide FOPs for the product control numbers included in the section C database but missing from the section D database. In its August 2, 2010, response to the supplemental section C questionnaire, Starbright explained that these products were sold during the POR, but not produced during the POR. Starbright further stated that it would provide the FOP information for these products in its response to the section D supplemental questionnaire.49 On August 17, 2010 Starbright provided matching product control numbers in its FOP database for the products that it reported were sold during the POR but not produced during the POR. Starbright stated that it had ‘‘created similars’’ for the product control numbers that did not have matches in the FOP database, and that it had created a new variable in the FOP database for the ‘‘similar’’ product control number. Starbright also included a chart listing the control numbers for the products sold to the United States, and the similar control number created by Starbright.50 However, based on Starbright’s explanation that it sold these products during the POR but did not produce these products during the POR, it was not clear whether Starbright produced the products prior to the POR, or purchased the products from another producer and how it derived the FOPs it reported for these products (e.g., did they reflect prior year’s production, production of other products, or something else entirely). Thus, on September 1, 2010, in a second section D supplemental questionnaire, the Department asked that Starbright explain the origin of the merchandise sold during the POR but not produced Certain New Pneumatic Off-the-Road Tires from the People’s Republic of China: Questionnaire,’’ dated January 22, 2010, at page D–1 (‘‘Questionnaire’’). 48 See Starbright’s April 27, 2010, sections C and D questionnaire response. 49 See Starbright’s August 2, 2010, supplemental questionnaire response at 5. 50 See Starbright’s August 17, 2010, supplemental questionnaire response at 1 and Exhibit SD–2. VerDate Mar<15>2010 16:24 Oct 18, 2010 Jkt 223001 by Starbright during the POR, and that Starbright provide evidence of its attempts to obtain FOP information from the producer or the merchandise if the products were purchased from another producer. The Department also explained that, if Starbright produced these products prior to the POR, it should provide the FOPs based on the prior production period (data it should have from the period of the investigation). On September 13, 2010, Starbright argued that any request for FOPs based on the prior year’s production would require a revision to its entire FOP database and refused to comply with the Department’s request for the FOP data from the prior production period. However, Starbright failed to explain why having to report the prior year’s FOPs for products not produced in the current POR would require a revision to the entire FOP database, since the prior year’s reporting would only be necessary for the products sold but not produced during the instant POR. Starbright further contended that it was unable to provide the requested FOP data in such a short period of time.51 Thus, Starbright disregarded the clear instructions in the original questionnaire, directing it to contact the Department if it had made sales of products during the POR that it did not produce during the POR. Starbright also refused to provide the information when requested by the Department in a supplemental questionnaire regarding the nature of what it had reported, thus rendering the data unusable. Moreover, Starbright provided no rationale for its creation of ‘‘similar’’ product control numbers for these products. Consequently, we preliminarily determine that partial facts available is warranted because necessary information is not on the record and because Starbright failed to provide requested information by the applicable deadlines and impeded the proceeding by not explaining the derivation of its reported ‘‘similar’’ FOPs. Section 776(a)(1), (a)(2)(B) and (a)(2)(C) of the Act. Moreover, by failing to notify the Department of the existence of sales for products not produced in the POR, despite the clear instruction in the questionnaire, and by failing to provide usable information by the applicable deadlines, the conditions of section 782(c)(1) and (e), to which Section 776(a)(2)(B) is subject, have not been satisfied. In addition, we determine that Starbright has not cooperated to the best of its ability by repeatedly failing to 51 See Starbright’s September 13, 2010, supplemental questionnaire response at 19. PO 00000 Frm 00024 Fmt 4703 Sfmt 4703 provide the requested FOP data from the production period, despite numerous opportunities to do so. Accordingly, an adverse inference in using facts available under section 776(b) of the Act is warranted for Starbright with regard to this specific information. For the products sold but not produced by Starbright during the POR as adverse facts available, we have applied the highest normal value for any control number in Starbright’s FOP database. See Starbright Preliminary Analysis Memorandum. 2. Rebates The original questionnaire instructs respondents: ‘‘where available, provide documentation, including sample agreements, for each type of rebate.’’ 52 Starbright provided a chart in exhibit C– 4 of its April 27, 2010, section C response, in which it summarized and calculated the rebates granted in 2008; however, Starbright provided no documentation to support its reported rebates, and no explanation as to why such documentation was unavailable. Furthermore, Starbright explained that it was still compiling information related to rebates granted in 2009.53 On July 1, 2010, the Department issued a supplemental questionnaire, in which it copied the question for the original questionnaire and requested that Starbright respond ‘‘in full.’’ 54 In its August 2, 2010, supplemental questionnaire response, Starbright submitted a revised exhibit C–4, in which it ‘‘expanded the summary to detail all customer codes,’’ but again provided no documentation, including copies of rebate agreements, and no explanation as to why it was unable to provide the requested information.55 On August 3, 2010, the Department requested that Starbright provide documentation to substantiate the rebate amounts for one sample customer reported in exhibit C–4 of its original section C response. On August 27, 2010, Starbright again revised its worksheet for 2008 rebates, and explained that the reported information ‘‘is from GPX’s system. As such, GPX believes these amounts to be substantiated.’’ 56 Starbright stated that based on information already provided, the 52 See Questionnaire at C–23. Starbright’s April 27, 2010, sections C questionnaire response at 35 and Exhibit C–4. 54 See Letter from the Department to Starbright: ‘‘First Administrative Review of the Antidumping Duty Order on New Pneumatic Off-the-Road Tires from the People’s Republic of China: Supplemental Section C Questionnaire’’, dated July 1, 2010, at 7. 55 See Starbright’s August 2, 2010, supplemental questionnaire response at 22–24. 56 See id. at 9. 53 See E:\FR\FM\19OCN1.SGM 19OCN1 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices Department ‘‘is able to calculate an antidumping margin that is substantiated by data and documentation drawn directly from GPX’s accounting system.’’ 57 With respect to the documentation that the Department repeatedly requested, such as copies of rebate agreements, Starbright stated that ‘‘it is virtually impossible for GPX to provide this documentation at this time.’’ 58 According to Starbright, as a result of GPX’s bankruptcy, ‘‘for all practical purposes, GPX, no longer exists * * * and the human staff has long since been dismissed.’’ 59 As a result, Starbright argued that ‘‘it would be unduly burdensome to require GPX to provide this additional documentation.’’ 60 With respect to its 2009 rebates, Starbright reported one program related solely to a specific customer, and another rebate program related to another specific customer. Starbright explained the relevant customer codes to which these two rebate programs were allocable. Starbright also reported an additional rebate program, claiming that a group of buyers ‘‘joined together in order to receive better large-scale pricing and/or rebates, (similar to a cooperative).’’ 61 Stabright explained that it was ‘‘still working to allocate the rebates’’ for this customer grouping, on a customer and/or product code basis.62 While Starbright reported the 2009 rebate rate for this rebate program, and claimed it could identify the full amount of the rebate paid, it stated that it could not identify the group of customers that participated in this rebate program, and thus it allocated the total claimed amount paid out over all 2009 U.S. sales of subject merchandise. On September 1, 2010, the Department explained that Starbright had failed to provide the requested documentation to substantiate the reported rebate amount for a previouslyselected sample customer. The Department again requested that Starbright provide a copy of the rebate agreement that established the rebate amount for that customer, as well as rebate receipts or any other documents that substantiate the numbers reported in Starbright’s rebate worksheets.63 The 57 See id. id. 59 See id. 60 See id. at 10. 61 See id. 62 See id. 63 See Letter from the Department to Starbright: ‘‘First Administrative Review of the Antidumping Duty Order on New Pneumatic Off-the-Road Tires from the People’s Republic of China: Third Supplemental Sections A, C, and D Questionnaire’’, dated September 1, 2010, at 5. mstockstill on DSKH9S0YB1PROD with NOTICES 58 See VerDate Mar<15>2010 16:24 Oct 18, 2010 Jkt 223001 Department also asked Starbright to document efforts to obtain the requested information in light of its claim that it would be unduly burdensome to require GPX to provide that documentation.64 In response, Starbright provided a credit memo used to grant the customer a credit in the amount of the rebate, but no documentation establishing the rebate rate, and no explanation for why it was unable to provide this documentation repeatedly requested by the Department.65 Starbright has still not allocated rebates to the cooperative customer grouping discussed in its August 27, 2010, response, and nor has it identified the members of this customer grouping. In response to the Department’s request for documentation of Starbright’s efforts to access substantiating documents, Starbright submitted a letter from the attorney for the liquidating supervisor for GPX explaining that, due to GPX’s liquidation, ‘‘complying with Commerce’s demands is extremely difficult.’’ 66 Starbright also submitted a declaration from a former GPX employee describing the liquidation process and a general summary of the employee’s efforts to retrieve requested documents.67 Neither submission nor the narrative provided to explain the submissions indicated any specific attempts to access the requested documents before September 2010, more than eight months after the Department first requested the information. Because Starbright did not provide the requested data the Department preliminary determines that it is appropriate to use facts available under sections 776(a)(1) and (a)(2)(B) of the Act. Because Starbright failed to promptly inform the Department of any difficulty in obtaining the data and failed to provide usable information by the applicable deadlines, the conditions of section 782(c)(1) and (e), to which section 776(a)(2)(B) is subject, have not been satisfied. Further, because Starbright did not satisfactorily demonstrate how it was unable to provide or unduly burdensome to provide the requested information, we determine that an adverse inference in using facts available under section 776(b) of the Act is warranted. As AFA, the Department is applying the reported rebate rate from this 2009 program to all 2009 sales for all customers, with the exception of the two customers identified by Starbright as having their 64 See id. at 3–4. Starbright’s September 13, 2010, supplemental questionnaire response at 14. 66 See id at 1–4 and Exhibit 4SA–1. 67 See id. 65 See PO 00000 Frm 00025 Fmt 4703 Sfmt 4703 64267 own rebate programs. See Starbright Preliminary Analysis Memorandum. Currency Conversion We made currency conversions into U.S. dollars, where appropriate, 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. Preliminary Results of Review We preliminary find that the following margins exist: Exporter Hebei Starbright Tire Co., Ltd ...... Hanghzou Zhongce Rubber Co., Ltd. KS Holding Limited/KS Resources Limited Laizhou Xiongying Rubber Industry Co., Ltd. Qingdao Taifa Group Co., Ltd ...... Weihai Zhongwei Rubber Co., Ltd Percent margin 20.74 20.74 20.74 20.74 20.74 20.74 We have not made an adjustment to the U.S. price for export subsidies because Starbright was not found to have export subsidies in the most recently completed segment of the companion countervailing duty proceeding.68 Disclosure We will disclose the calculations used in our analysis to parties to this proceeding within five days of the publication date of this notice. See 19 CFR 351.224(b). Interested parties are invited to comment on the preliminary results and may submit case briefs and/ or written comments within 30 days of the date of publication of this notice. See 19 CFR 351.309(c). Interested parties may file rebuttal briefs and rebuttals to written comments, limited to issues raised in such briefs or comments, no later than five days after the date on which the case briefs are due. See 19 CFR 351.309(d). The Department requests that parties submitting written comments provide an executive summary and a table of authorities as well as an additional copy of those comments electronically. Any interested party may request a hearing within 30 days of publication of this notice. See 19 CFR 351.310(c). If a request for a hearing is made, parties will be notified of the time and date for the hearing to be held at the U.S. Department of Commerce, 14th Street 68 Similarly, because no export subsidies were found to be applicable to ‘‘all others’’ in the most recently completed segment of the companion countervailing duty proceeding, we also have not adjusted the rate applied to the separate rate recipients. E:\FR\FM\19OCN1.SGM 19OCN1 64268 Federal Register / Vol. 75, No. 201 / Tuesday, October 19, 2010 / Notices and Constitution Avenue, NW., Washington, DC 20230. See 19 CFR 351.310(d). The Department will issue the final results of this administrative review, which will include the results of its analysis of issues raised in any such comments, within 120 days of publication of these preliminary results, pursuant to section 751(a)(3)(A) of the Act. mstockstill on DSKH9S0YB1PROD with NOTICES Deadline for Submission of Publicly Available Surrogate Value Information In accordance with 19 CFR 351.301(c)(3)(ii), the deadline for submission of publicly available information to value FOPs under 19 CFR 351.408(c) is 20 days after the date of publication of the preliminary results. In accordance with 19 CFR 351.301(c)(1), if an interested party submits factual information less than ten days before, on, or after (if the Department has extended the deadline), the applicable deadline for submission of such factual information, an interested party may submit factual information to rebut, clarify, or correct the factual information no later than ten days after such factual information is served on the interested party. However, the Department generally will not accept in the rebuttal submission additional or alternative surrogate value information not previously on the record, if the deadline for submission of surrogate value information has passed.69 Furthermore, the Department generally will not accept business proprietary information in either the surrogate value submissions or the rebuttals thereto, as the regulation regarding the submission of surrogate values allows only for the submission of publicly available information. See 19 CFR 351.301(c)(3). Assessment Rates Upon issuance of the final results, the Department will determine, and CBP shall assess, antidumping duties on all appropriate entries covered by this review. The Department intends to issue assessment instructions to CBP 15 days after the publication date of the final results of this review. In accordance with 19 CFR 351.212(b)(1), we calculated exporter/importer (or customer)-specific assessment rates for the merchandise subject to this review. Where the respondent reports reliable entered values, we calculate importer (or customer)-specific ad valorem rates 69 See, e.g., 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. VerDate Mar<15>2010 16:24 Oct 18, 2010 Jkt 223001 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 importers’/ customers’ entries during the POR. See 19 CFR 351.212(b)(1). Where we do not have entered values for all U.S. sales, we calculate 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, we will instruct CBP to liquidate appropriate entries without regard to antidumping duties. See 19 CFR 351.106(c)(2). Cash Deposit Requirements The following cash deposit requirements will be effective upon publication of the final results of this administrative review for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided for by section 751(a)(2)(C) of the Act: (1) For Starbright, Hangzhou Zhongce, KS Ltd., Laizhou Xiongying, Qingdao Taifa and Weihai Zhongwei, the cash deposit rate will be the company-specific rate established in the final results of this review (except, if the rate is zero or de minimis, no cash deposit will be required); (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 or exporter/ producer-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 210.48 percent; and (4) for all non-PRC exporters of subject merchandise that have not received their own rate, the cash deposit rate will be the rate applicable to the PRC exporters that supplied that nonPRC exporter. These deposit requirements, when imposed, shall remain in effect until further notice. PO 00000 Frm 00026 Fmt 4703 Sfmt 4703 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 sections 751(a)(1) and 777(i)(1) of the Act. Dated: October 7, 2010. Ronald K. Lorentzen, Deputy Assistant Secretary for Import Administration. [FR Doc. 2010–26193 Filed 10–18–10; 8:45 am] BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE International Trade Administration [C–570–913] New Pneumatic Off-the-Road Tires From the People’s Republic of China: Preliminary Results of Countervailing Duty Administrative Review Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce (the Department) is conducting an administrative review of Hebei Starbright Tire Co., Ltd. (Starbright) under the countervailing duty order on certain new pneumatic off-the-road tires (OTR Tires) from the People’s Republic of China (PRC) for the period December 17, 2007, through December 31, 2008. We preliminarily determine that subsidies are being provided to Starbright for the production and export of certain new pneumatic off-the-road tires from the PRC. See ‘‘Preliminary Results of Administrative Review’’ section, below. If the final results remain the same as the preliminary results of this review, we will instruct U.S. Customs and Border Protection (CBP) to assess countervailing duties at the rate indicated below. Interested parties are invited to comment on the preliminary results of this administrative review. See ‘‘Disclosure and Public Comments’’ section below. DATES: Effective Date: October 19, 2010. FOR FURTHER INFORMATION CONTACT: Andrew Huston or Jun Jack Zhao, AD/ CVD Operations, Office 6, Import Administration, International Trade AGENCY: E:\FR\FM\19OCN1.SGM 19OCN1

Agencies

[Federal Register Volume 75, Number 201 (Tuesday, October 19, 2010)]
[Notices]
[Pages 64259-64268]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-26193]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-912]


Certain New Pneumatic Off-the-Road Tires From the People's 
Republic of China: Preliminary Results of Antidumping Duty 
Administrative Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') is conducting 
an administrative review of the antidumping duty order on certain new 
pneumatic off-the-road tires (``OTR tires'') from the People's Republic 
of China (``PRC'') covering the period February 20, 2008, through 
August 31, 2009. The administrative review (``AR'') covers six 
exporters. We have preliminarily determined that certain exporters who 
participated fully and are entitled to a separate rate sold subject 
merchandise to the United States at prices below normal value (``NV'') 
during the period of review (``POR''). If these preliminary results are 
adopted in our final results of review, we will instruct U.S. Customs 
and Border Protection (``CBP'') to assess antidumping duties on entries 
of subject merchandise during the POR for which the importer-specific 
assessment rates are above de minimis.
    We invite interested parties to comment on these preliminary 
results. We intend to issue the final results no later than 120 days 
from the date of publication of this notice, pursuant to section 
751(a)(3)(A) of the Tariff Act of 1930, as amended (``the Act'').

DATES: Effective Date: October 19, 2010.

FOR FURTHER INFORMATION CONTACT: Raquel Silva or Lilit Astvatsatrian, 
AD/CVD Operations, Office 8, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
6475 or (202) 482-6412, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On September 4, 2008, the Department published the antidumping duty 
order on OTR Tires from the PRC. See Certain New Pneumatic Off-the-Road 
Tires From the People's Republic of China: Notice of Amended Final 
Affirmative Determination of Sales at Less Than Fair Value and 
Antidumping Duty Order, 73 FR 51624 (September 4, 2008). On September 
1, 2009, the Department published a notice of opportunity to request an 
administrative review of this order for the February 20, 2008, through, 
August 31, 2009, POR (hereinafter referred to as the 2008-2009 review). 
See Antidumping or Countervailing Duty Order, Finding, or Suspended 
Investigation; Opportunity to Request Administrative Review, 74 FR 
45179 (September 1, 2009). In accordance with 19 CFR 351.213(b), 
interested parties made requests for review between September 23, 2009, 
and September 30, 2009, on fifteen exporters. On October 26, 2009, the 
Department initiated the 2008-2009 review.\1\ GPX International Tire 
Corporation (``GPX'') requested that the Department conduct a review of 
exports of eight of the fifteen exporters. On November 20, 2009, GPX 
withdrew its review request for seven of the eight exporters for which 
it requested review, but maintained its request that the Department 
conduct a review of Hebei Starbright Tire Co., Ltd. (``Starbright''). 
On January 22, 2010, the Department selected Starbright and TUTRIC as 
mandatory respondents. Between November 24, 2009, and February 24, 
2010, three more parties withdrew their respective review requests 
related to these same exporters, including TUTRIC. On May 21, 2010, the 
Department rescinded the administrative reviews of OTR tires with 
respect to TUTRIC and seven additional exporters because all parties 
requesting reviews of these entities had withdrawn their respective 
requests.\2\
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    \1\ See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Request for Revocation in Part, 74 FR 
54956, 54958 (October 26, 2009) (``Initiation Notice''). The 
Department initiated reviews of (1) Aeolus Tyre Co., Ltd. 
(``Aeolus''), (2) Guizhou Tire Co., Ltd. (``GTC''), (3) Hanghzou 
Zhongce Rubber Co., Ltd. (``Hangzhou Zhongce''), (4) Starbright, (5) 
Innova Rubber Co., Ltd. (``Innova''), (6) Jiangsu Feichi Co., Ltd. 
(``Feichi''), (7) KS Holding Limited/KS Resources Limited (``KS 
Ltd.''), (8) Laizhou Xiongying Rubber Industry Co., Ltd. (Laizhou 
Xiongying''), (9) Qingdao Free Trade Zone Full-World International 
Trading Co. (``Full World''), Ltd., (10) Qingdao Taifa Group Co., 
Ltd. (Qingdao Taifa''), (11) Shandong Huitong Tyre Co., Ltd. 
(``Huitong''), (12) Tianjin Wanda Tyre Group (Wanda''), (13) Tianjin 
United Tire & Rubber International Co., Ltd. (``TUTRIC''), (14) 
Triangle Tyre Co., Ltd. (``Triangle''), and (15) Weihai Zhongwei 
Rubber Co., Ltd. (``Weihai Zhongwei'').
    \2\ See New Pneumatic Off-the-Road Tires From the People's 
Republic of China: Notice of Partial Rescission of Antidumping Duty 
Administrative Review, 75 FR 28567 (May 21, 2010). In addition to 
TUTRIC, the Department rescinded the reviews of Aeolus, Feichi, GTC, 
Huitong, Innova, Triangle and Wanda.
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    On January 28, 2010, Hanify & King, bankruptcy counsel to GPX, 
informed the Department of GPX's filing of a Chapter 11 petition under 
the United States Bankruptcy Code on October 26, 2009, which counsel 
claimed automatically stayed the Department's administrative 
proceedings with respect to GPX. On February 3, 2010, both domestic 
interested parties \3\ submitted letters to the Department expressing 
concerns about the effect of GPX's bankruptcy petition on the ongoing 
administrative review. In response to parties' concerns, the Department 
extended regulatory deadlines for Titan and Bridgestone until 
resolution of those concerns. On February 12, 2010, as a result of 
Government closures during snowstorms, Import Administration tolled all 
deadlines by one calendar week. See Memorandum from DAS for Import 
Administration, ``Tolling of Administrative Deadlines As A Result of 
the Government Closure During the Recent Snowstorm,'' dated February 
12, 2010, available at http://ia.ita.doc.gov/ia-highlights-and-news.html. On May 5, 2010, upon resolution of issues related to GPX's 
bankruptcy petition, the Department extended the deadlines for (1) 
Verification requests, (2) factual information submissions, (3) 
comments on surrogate country selection, and (4) submission of publicly 
available information for valuing factors of production.
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    \3\ Titan Tire Corporation (``Titan''), and Bridgestone 
Americas, Inc., and Bridgestone Americas Tire Operations, LLC 
(collectively ``Bridgestone''), both domestic producers of the like 
product.
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    On May 5, 2010, the Department selected Qingdao Free Trade Zone 
Full World International Trading Co., Ltd. (``Full-World'') as the 
mandatory respondent to replace TUTRIC. On May 26, 2010, Full-World 
withdrew its request for an administrative review of its exports. On 
August 4, 2010, the Department published in the Federal Register a 
notice rescinding the administrative review of OTR tires with respect 
to Full-World.\4\
---------------------------------------------------------------------------

    \4\ See New Pneumatic Off-the-Road Tires from the People's 
Republic of China: Notice of Partial Rescission of Antidumping Duty 
Administrative Review, 75 FR 46917 (August 4, 2010).
---------------------------------------------------------------------------

    On June 7, 2010, the Department published in the Federal Register a 
notice fully extending the time limit for the preliminary results of 
this review to October 7, 2010. See New Pneumatic Off-the-Road Tires 
from the People's Republic of China: Extension of Preliminary Results 
of Antidumping

[[Page 64260]]

Duty Administrative Review, 75 FR 32158 (June 7, 2010). On July 23, 
2010, and July 29, 2010, parties submitted comments on surrogate 
country selection. On July 29, 2010, parties submitted comments on 
surrogate values. On August 10, 2010, parties submitted rebuttal 
comments on surrogate values. Between January 22, 2010, and September 
1, 2010, the Department issued to Starbright the original antidumping 
questionnaire, and six supplemental questionnaires. Between February 
24, 2010, and September 10, 2010, Starbright submitted timely responses 
to the Department's seven questionnaires.

Period of Review

    The POR is February 20, 2008, through August 31, 2009.

Scope of Order

    The products covered by the order are new pneumatic tires designed 
for off-the-road and off-highway use, subject to exceptions identified 
below. Certain OTR tires are generally designed, manufactured and 
offered for sale for use on off-road or off-highway surfaces, including 
but not limited to, agricultural fields, forests, construction sites, 
factory and warehouse interiors, airport tarmacs, ports and harbors, 
mines, quarries, gravel yards, and steel mills. The vehicles and 
equipment for which certain OTR tires are designed for use include, but 
are not limited to: (1) Agricultural and forestry vehicles and 
equipment, including agricultural tractors,\5\ combine harvesters,\6\ 
agricultural high clearance sprayers,\7\ industrial tractors,\8\ log-
skidders,\9\ agricultural implements, highway-towed implements, 
agricultural logging, and agricultural, industrial, skid-steers/mini-
loaders; \10\ (2) construction vehicles and equipment, including 
earthmover articulated dump products, rigid frame haul trucks,\11\ 
front end loaders,\12\ dozers,\13\ lift trucks, straddle carriers,\14\ 
graders,\15\ mobile cranes,\16\ compactors; and (3) industrial vehicles 
and equipment, including smooth floor, industrial, mining, 
counterbalanced lift trucks, industrial and mining vehicles other than 
smooth floor, skid-steers/mini-loaders, and smooth floor off-the-road 
counterbalanced lift trucks.\17\ The foregoing list of vehicles and 
equipment generally have in common that they are used for hauling, 
towing, lifting, and/or loading a wide variety of equipment and 
materials in agricultural, construction and industrial settings. Such 
vehicles and equipment, and the descriptions contained in the footnotes 
are illustrative of the types of vehicles and equipment that use 
certain OTR tires, but are not necessarily all-inclusive. While the 
physical characteristics of certain OTR tires will vary depending on 
the specific applications and conditions for which the tires are 
designed (e.g., tread pattern and depth), all of the tires within the 
scope have in common that they are designed for off-road and off-
highway use. Except as discussed below, OTR tires included in the scope 
of the order range in size (rim diameter) generally but not exclusively 
from 8 inches to 54 inches. The tires may be either tube-type \18\ or 
tubeless, radial or non-radial, and intended for sale either to 
original equipment manufacturers or the replacement market. The subject 
merchandise is currently classifiable under Harmonized Tariff Schedule 
of the United States (``HTSUS'') subheadings: 4011.20.10.25, 
4011.20.10.35, 4011.20.50.30, 4011.20.50.50, 4011.61.00.00, 
4011.62.00.00, 4011.63.00.00, 4011.69.00.00, 4011.92.00.00, 
4011.93.40.00, 4011.93.80.00, 4011.94.40.00, and 4011.94.80.00. While 
HTSUS subheadings are provided for convenience and customs purposes, 
our written description of the scope is dispositive.
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    \5\ Agricultural tractors are dual-axle vehicles that typically 
are designed to pull farming equipment in the field and that may 
have front tires of a different size than the rear tires.
    \6\ Combine harvesters are used to harvest crops such as corn or 
wheat.
    \7\ Agricultural sprayers are used to irrigate agricultural 
fields.
    \8\ Industrial tractors are dual-axle vehicles that typically 
are designed to pull industrial equipment and that may have front 
tires of a different size than the rear tires.
    \9\ A log-skidder has a grappling lift arm that is used to 
grasp, lift and move trees that have been cut down to a truck or 
trailer for transport to a mill or other destination.
    \10\ Skid-steer loaders are four-wheel drive vehicles with the 
left-side drive wheels independent of the right-side drive wheels 
and lift arms that lie alongside the driver with the major pivot 
points behind the driver's shoulders. Skid-steer loaders are used in 
agricultural, construction and industrial settings.
    \11\ Haul trucks, which may be either rigid frame or articulated 
(i.e., able to bend in the middle) are typically used in mines, 
quarries and construction sites to haul soil, aggregate, mined ore, 
or debris.
    \12\ Front loaders have lift arms in front of the vehicle. They 
can scrape material from one location to another, carry material in 
their buckets, or load material into a truck or trailer.
    \13\ A dozer is a large four-wheeled vehicle with a dozer blade 
that is used to push large quantities of soil, sand, rubble, etc., 
typically around construction sites. They can also be used to 
perform ``rough grading'' in road construction.
    \14\ A straddle carrier is a rigid frame, engine-powered machine 
that is used to load and offload containers from container vessels 
and load them onto (or off of) tractor trailers.
    \15\ A grader is a vehicle with a large blade used to create a 
flat surface. Graders are typically used to perform ``finish 
grading.'' Graders are commonly used in maintenance of unpaved roads 
and road construction to prepare the base course on to which asphalt 
or other paving material will be laid.
    \16\ I.e., ``on-site'' mobile cranes designed for off-highway 
use.
    \17\ A counterbalanced lift truck is a rigid framed, engine-
powered machine with lift arms that has additional weight 
incorporated into the back of the machine to offset or 
counterbalance the weight of loads that it lifts so as to prevent 
the vehicle from overturning. An example of a counterbalanced lift 
truck is a counterbalanced fork lift truck. Counterbalanced lift 
trucks may be designed for use on smooth floor surfaces, such as a 
factory or warehouse, or other surfaces, such as construction sites, 
mines, etc.
    \18\ While tube-type tires are subject to the scope of this 
proceeding, tubes and flaps are not subject merchandise and 
therefore are not covered by the scope of this proceeding, 
regardless of the manner in which they are sold (e.g., sold with or 
separately from subject merchandise).
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    Specifically excluded from the scope are new pneumatic tires 
designed, manufactured and offered for sale primarily for on-highway or 
on-road use, including passenger cars, race cars, station wagons, sport 
utility vehicles, minivans, mobile homes, motorcycles, bicycles, on-
road or on-highway trailers, light trucks, and trucks and buses. Such 
tires generally have in common that the symbol ``DOT'' must appear on 
the sidewall, certifying that the tire conforms to applicable motor 
vehicle safety standards. Such excluded tires may also have the 
following designations that are used by the Tire and Rim Association:

Prefix Letter Designations

     P--Identifies a tire intended primarily for service on 
passenger cars;
     LT--Identifies a tire intended primarily for service on 
light trucks; and,
     ST--Identifies a special tire for trailers in highway 
service.

Suffix Letter Designations

     TR--Identifies a tire for service on trucks, buses, and 
other vehicles with rims having specified rim diameter of nominal plus 
0.156'' or plus 0.250''
     MH--Identifies tires for Mobile Homes;
     HC--Identifies a heavy duty tire designated for use on 
``HC'' 15'' tapered rims used on trucks, buses, and other vehicles. 
This suffix is intended to differentiate among tires for light trucks, 
and other vehicles or other services, which use a similar designation.
     Example: 8R17.5 LT, 8R17.5 HC;
     LT--Identifies light truck tires for service on trucks, 
buses, trailers, and multipurpose passenger vehicles used in nominal 
highway service; and
     MC--Identifies tires and rims for motorcycles.
    The following types of tires are also excluded from the scope: 
Pneumatic tires that are not new, including recycled or retreaded tires 
and used

[[Page 64261]]

tires; non-pneumatic tires, including solid rubber tires; tires of a 
kind designed for use on aircraft, all-terrain vehicles, and vehicles 
for turf, lawn and garden, golf and trailer applications. Also excluded 
from the scope are radial and bias tires of a kind designed for use in 
mining and construction vehicles and equipment that have a rim diameter 
equal to or exceeding 39 inches. Such tires may be distinguished from 
other tires of similar size by the number of plies that the 
construction and mining tires contain (minimum of 16) and the weight of 
such tires (minimum 1500 pounds).

Non-Market Economy Country Status

    No party contested the Department's treatment of the PRC as a non-
market economy (``NME'') country, and the Department has treated the 
PRC as an NME country in all past antidumping duty investigations and 
administrative reviews.\19\ No interested party in this case has argued 
that we should do otherwise. Designation as an NME country remains in 
effect until it is revoked by the Department. See section 771(18)(C)(i) 
of the Act. As such, we continue to treat the PRC as an NME in this 
proceeding.
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    \19\ See, e.g., Chlorinated Isocyanurates from the People's 
Republic of China: Final Results of Antidumping Duty Administrative 
Review, 73 FR 52645 (September 10, 2008); see also Folding Metal 
Tables and Chairs from the People's Republic of China: Final Results 
of Antidumping Duty Administrative Review, 74 FR 3560 (January 21, 
2009).
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Surrogate Country

    Section 773(c)(1) of the Act directs the Department to base NV on 
the NME producer's factors of production (``FOPs''), valued in a 
surrogate market economy (``ME'') 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 use, to the extent 
possible, the prices or costs of the FOPs in one or more ME countries 
that are: (1) At a level of economic development comparable to that of 
the NME country; and (2) significant producers of comparable 
merchandise. The sources of the surrogate factor values are discussed 
under the ``Normal Value'' section below. See Memorandum to The File, 
``Preliminary Results of the 2008-2009 Administrative Review of New 
Pneumatic Off-the-Road Tires from the People's Republic of China: 
Surrogate Value Memorandum,'' dated concurrently with this notice 
(``Surrogate Value Memorandum'').
    The Department determined that India, Indonesia, Ukraine, Peru, the 
Philippines and Thailand are countries comparable to the PRC in terms 
of economic development.\20\ Once we have identified the countries that 
are economically comparable to the PRC, we select 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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    \20\ See Memoranda to Wendy J. Frankel, Office Director, AD/CVD 
Operations, Office 8, ``Request for a List of Surrogate Countries 
for an Administrative Review of the Antidumping Duty Order Covering 
New Pneumatic Off-the-Road Tires from the People's Republic of 
China,'' dated January 25, 2010.
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    The Department has determined that India is the appropriate 
surrogate country for use in this review. The Department based its 
decision on the following facts: (1) India is at a level of economic 
development comparable to that of the PRC; (2) India is a significant 
producer of comparable merchandise; and (3) India provides the best 
opportunity to use quality, publicly available data to value the FOPs. 
Titan and Bridgestone provided comments on July 23, 2010, and July 29, 
2010, respectively, arguing that India is the appropriate surrogate 
country for use in this review. Additionally, the data submitted by 
Titan, Bridgestone and Starbright for our consideration as potential 
surrogate values are sourced from India.
    Therefore, because India best represents the experience of 
producers of comparable merchandise operating in an ME, we have 
selected India as the surrogate country and, accordingly, have 
calculated NV using Indian prices to value the respondent's FOPs, when 
available and appropriate. See Surrogate Value Memorandum. We have 
obtained and relied upon publicly available information wherever 
possible.

Separate Rates

    In the Initiation Notice, the Department applied a process by which 
exporters and producers not being individually reviewed may obtain 
separate-rate status in NME reviews. The process requires exporters and 
producers to submit a separate-rate status application (``SRA'') or 
separate-rate status certification (``SRC'').\21\ However, the standard 
for eligibility for a separate rate (which is whether a firm can 
demonstrate an absence of both de jure and de facto government control 
over its export activities) has not changed. From November 30 to 
December 2, 2009, six exporters of the subject merchandise filed timely 
responses to the Department's SRAs or SRCs, as applicable.\22\
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    \21\ See Policy Bulletin 05.1: Separate-Rates Practice and 
Application of Combination Rates in Antidumping Investigations 
involving Non-Market Economy Countries (April 5, 2005), available at 
http://ia.ita.doc.gov/policy/bull05-1.pdf.
    \22\ Hangzou Zhongce; Starbright; KS Ltd.; Laizhou Xiongying; 
Qingdao Taifa; and Weihai Zhongwei.
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    In proceedings involving NME countries, the Department has a 
rebuttable presumption that all companies within the country are 
subject to government control and, thus, should be assessed a single 
antidumping duty rate.\23\ It is the Department's policy to assign all 
exporters of merchandise subject to review 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.\24\ Exporters can 
demonstrate this independence through the absence of both de jure and 
de facto government control over export activities. The Department 
analyzes each entity exporting the subject merchandise under a test 
arising from the Notice of Final Determination of Sales at Less Than 
Fair Value: Sparklers from the People's Republic of China, 56 FR 20588, 
at Comment 1 (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, 22587 (May 2, 
1994) (``Silicon Carbide''). However, if the Department determines that 
a company is wholly foreign-owned or located in an ME, then an SRA 
analysis is not necessary to determine whether it is independent from 
government control.\25\
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    \23\ See, e.g., Certain Coated Paper Suitable for High-Quality 
Print Graphics Using Sheet-Fed Presses From the People's Republic of 
China: Notice of Preliminary Determination of Sales at Less Than 
Fair Value and Postponement of Final Determination, 75 FR 24892, 
24899 (May 6, 2010) (unchanged in Certain Coated Paper Suitable for 
High-Quality Print Graphics Using Sheet-Fed Presses From the 
People's Republic of China: Final Determination of Sales at Less 
Than Fair Value, 75 FR 59217 (September 27, 2010)).
    \24\ Id.
    \25\ See, e.g., Final Results of Antidumping Duty Administrative 
Review: Petroleum Wax Candles From the People's Republic of China, 
72 FR 52355, 52356 (September 13, 2007).
---------------------------------------------------------------------------

A. Separate-Rate Recipients \26\
---------------------------------------------------------------------------

    \26\ All separate-rate applicants receiving a separate rate are 
hereby referred to collectively as the ``SR Recipients;'' this 
includes the mandatory respondent.
---------------------------------------------------------------------------

1. Wholly Foreign-Owned
    Starbright reported that during the POR it was wholly owned by GPX, 
a U.S. company, and KS Ltd. reported in its SRA that it is wholly-owned 
by a company located in Hong Kong. Therefore, consistent with the

[[Page 64262]]

Department's practice, a further SRA analysis is not necessary to 
determine whether Starbright's and KS Ltd.'s export activities are 
independent from government control, and we have preliminarily granted 
a separate rate to Starbright and KS Ltd.\27\
---------------------------------------------------------------------------

    \27\ See, e.g., Notice of Final Determination of Sales at Less 
Than Fair Value: Creatine Monohydrate from the People's Republic of 
China, 64 FR 71104, 71104-05 (December 20, 1999) (where the 
respondent was wholly foreign-owned and, thus, qualified for a 
separate rate).
---------------------------------------------------------------------------

2. Wholly Chinese-Owned Companies
    Hangzhou Zhongce, Laizhou Xiongying, Qingdao Taifa, and Weihai 
Zhongwei stated that they are wholly Chinese-owned companies 
(collectively ``PRC SR Applicants''). Therefore, the Department must 
analyze whether these respondents can demonstrate the absence of both 
de jure and de facto governmental control over 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 licenses; (2) any legislative 
enactments decentralizing control of companies; and (3) other formal 
measures by the government decentralizing control of companies.\28\
---------------------------------------------------------------------------

    \28\ See Sparklers, 56 FR at 20589.
---------------------------------------------------------------------------

    The evidence provided by the PRC SR Recipients \29\ 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 exporters' business and export licenses; (2) there 
are applicable legislative enactments decentralizing control of the 
companies; and (3) there are formal measures by the government 
decentralizing control of companies.
---------------------------------------------------------------------------

    \29\ Collective reference for all respondents receiving a 
separate rate in this administrative review.
---------------------------------------------------------------------------

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 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.\30\ 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. The evidence 
placed on the record of this review by the PRC SR Recipients 
demonstrates an absence of de jure and de facto government control with 
respect to each of the exporters' exports of the merchandise under 
consideration, in accordance with the criteria identified in Sparklers 
and Silicon Carbide.
---------------------------------------------------------------------------

    \30\ 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).
---------------------------------------------------------------------------

Rate for Non-Selected Companies

    The statute and the Department's regulations do not address the 
establishment of a rate to be applied to individual companies not 
selected for examination where the Department limited its examination 
in an administrative review pursuant to section 777A(c)(2) of the Act. 
Generally, we have looked to section 735(c)(5) of the Act, which 
provides instructions for calculating the all-others rate in an 
investigation, for guidance when calculating the rate for respondents 
we did not examine in an administrative review. For the exporters 
subject to a review that were determined to be eligible for separate 
rate status, but were not selected as mandatory respondents, the 
Department generally weight-averages the rates calculated for the 
mandatory respondents, excluding any rates that are zero, de minimis, 
or based entirely on FA.\31\ For this administrative review, the 
Department has calculated a positive margin for the single mandatory 
respondent, Starbright. Accordingly, for these preliminary results, 
consistent with our practice, the Department has preliminarily 
established a margin for the SR Recipients based on the rate calculated 
for the single mandatory respondent, Starbright.
---------------------------------------------------------------------------

    \31\ See, e.g., Wooden Bedroom Furniture from the People's 
Republic of China: Preliminary Results of Antidumping Duty 
Administrative Review, Preliminary Results of New Shipper Review and 
Partial Rescission of Administrative Review, 73 FR 8273, 8279 
(February 13, 2008) (unchanged in Wooden Bedroom Furniture from the 
People's Republic of China: Final Results of Antidumping Duty 
Administrative Review and New Shipper Review, 73 FR 49162 (August 
20, 2008)).
---------------------------------------------------------------------------

Date of Sale

    Section 401(i) of the Department's regulations states that:

    In identifying the date of sale of the subject merchandise or 
foreign like product, the Secretary normally will use the date of 
invoice, as recorded in the exporter or producer's records kept in 
the ordinary course of business. However, the Secretary may use a 
date other than the date of invoice if the Secretary is satisfied 
that a different date better reflects the date on which the exporter 
or producer establishes the material terms of sale.

See also Allied Tube and Conduit Corp. v. United States, 132 F. Supp. 
2d 1087, 1090-1092 (CIT 2001) (upholding the Department's rebuttable 
presumption that invoice date is the appropriate date of sale). After 
examining the questionnaire responses and the sales documentation 
placed on the record by Starbright, we preliminarily determine that 
invoice date is the most appropriate date of sale for Starbright. 
Nothing on the record rebuts the presumption that invoice date should 
be the date of sale.

Normal Value Comparisons

    To determine whether Starbright's sales of OTR tires to the United 
States were made at less than NV, we compared constructed export price 
(``CEP'') to NV, as described in the ``Constructed Export Price,'' and 
``Normal Value'' sections of this notice, pursuant to section 771(35) 
of the Act.

Constructed Export Price

    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. In accordance with section 772(b) of the Act, we used 
CEP for Starbright's sales because the sales were made by GPX, 
Starbright's U.S. affiliate in the United States.
    We calculated CEP based on delivered prices to unaffiliated 
purchasers in the United States. In accordance with section 772(d)(1) 
of the Act, we made deductions from the starting price for billing 
adjustments, movement expenses, discounts and rebates, and selling 
expenses in the U.S. market. We made deductions from the U.S. sales 
price for movement expenses in accordance with section 772(c)(2)(A) of 
the Act. These included, where applicable, foreign inland freight and 
insurance from the plant to the port of

[[Page 64263]]

exportation, foreign inland insurance, ocean freight, marine insurance, 
U.S. Customs duty, U.S. brokerage and handling, U.S. inland freight 
from port to the warehouse, warehousing expense and U.S. inland freight 
from the warehouse to the customer. In accordance with section 
772(d)(1) of the Act, the Department deducted, where applicable, 
commissions, credit expenses, warranty expenses, inventory carrying 
costs and indirect selling expenses from the U.S. price, all of which 
relate to commercial activity in the United States. In calculating its 
reported indirect selling expenses, the company did not include a 
significant number of items that it later claimed should be excluded; 
however, it did not provide any substantiation for this claim. 
Accordingly, for purposes of these preliminary results of review, we 
have included these items in the indirect selling expense adjustment to 
U.S. price.\32\ Further, we did not grant an offset to interest 
expenses for short-term interest income because Starbright did not 
demonstrate that any of GPX's interest income was generated from short-
term assets. However, we will issue a post-preliminary supplemental 
questionnaire to Starbright requesting that it provide substantiating 
documentation for its claim that all of its originally excluded items 
should be excluded from indirect selling expenses, and provide 
Starbright an opportunity to provide evidence that any of GPX's 
interest income was short term in nature. In addition, we deducted CEP 
profit in accordance with sections 772(d)(3) and 772(f) of the Act. In 
accordance with section 772(d) of the Act, we calculated Starbright's 
credit expenses and inventory carrying costs based on the actual short-
term interest rate reported for loans obtained by GPX during the 
POR.\33\
---------------------------------------------------------------------------

    \32\ See Memorandum to the File, ``Certain New Pneumatic Off-
The-Road Tires from the People's Republic of China: Analysis 
Memorandum for the Preliminary Determination: Hebei Starbright Tire 
Co., Ltd. (`Starbright'),'' dated October 7, 2010 (`Starbright 
Preliminary Analysis Memorandum'').
    \33\ See Starbright Preliminary Analysis Memorandum.
---------------------------------------------------------------------------

Normal Value

    Section 773(c)(1) of the Act provides that, in the case of an NME, 
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 NME economies renders price comparisons 
and the calculation of production costs invalid under our normal 
methodologies. Therefore, in these preliminary results, we have 
calculated NV based on FOPs in accordance with sections 773(c)(3) and 
(4) of the Act and 19 CFR 351.408(c). The FOPs include: (1) Hours of 
labor required; (2) quantities of raw materials employed; (3) amounts 
of energy and other utilities consumed; and (4) representative capital 
costs. In accordance with 19 CFR 351.408(c)(1), the Department normally 
uses publicly available information to value the FOPs. However, when a 
producer sources a meaningful amount of an input from an ME country and 
pays for it in ME currency, the Department may value the factor using 
the actual price paid for the input.\34\ Further, the Department 
disregards prices it has reason to suspect may be subsidized.\35\
---------------------------------------------------------------------------

    \34\ See 19 CFR 351.408(c)(1); see also Lasko Metal Products v. 
United States, 43 F.3d 1442, 1445-1446 (Fed. Cir. 1994) (affirming 
the Department's use of market-based prices to value certain FOPs).
    \35\ See, e.g., China National Machinery Import & Export Corp. 
v. United States, 293 F. Supp. 2d 1334, 1339 (CIT 2003) (aff'd, 104 
Fed. Appx. 183 (Fed. Cir. 2004)) (``China National Machinery''), and 
see Frontseating Service Valves from the People's Republic of China; 
Preliminary Determination of Sales at Less Than Fair Value, 
Preliminary Negative Determination of Critical Circumstances, and 
Postponement of Final Determination, 73 FR 62952 (October 22, 2008) 
(unchanged in Frontseating Service Valves from the People's Republic 
of China: Final Determination of Sales at Less Than Fair Value and 
Final Negative Determination of Critical Circumstances, 74 FR 10886 
(March 13, 2009)) (``Frontseating Service Valves'').
---------------------------------------------------------------------------

    In accordance with the legislative history of the Omnibus Trade and 
Competitiveness Act of 1988, the Department continues to apply its 
long-standing practice of disregarding surrogate values if it has a 
reason to believe or suspect the source data may be subsidized.\36\ In 
this regard, the Department has previously found that it is appropriate 
to disregard such prices from India, Indonesia, South Korea and 
Thailand because we have determined that these countries maintain 
broadly available, non-industry specific export subsidies.\37\ 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 India, Indonesia, South Korea and Thailand may have 
benefitted from these subsidies.
---------------------------------------------------------------------------

    \36\ 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.
    \37\ 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 pages 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 page 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 pages 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 page 23.
---------------------------------------------------------------------------

Factor Valuations

    In accordance with section 773(c) of the Act, we calculated NV 
based on the FOPs reported by Starbright for the POR. To calculate NV, 
we multiplied the reported per-unit factor quantities by publicly 
available Indian surrogate values (except as noted below). In selecting 
the surrogate values, we considered the quality, specificity, public 
availability, and contemporaneity of the data. As appropriate, we 
adjusted input prices by including freight costs to render them 
delivered prices. Specifically, we added to Indian import surrogate 
values 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 (i.e., where the 
sales terms for the ME inputs were not delivered to the factory). This 
adjustment is in accordance with the decision of the Federal Circuit in 
Sigma Corp. v. United States, 117 F. 3d 1401, 1408 (Fed. Cir. 1997). 
For a detailed description of all surrogate values used for Starbright, 
see the Surrogate Value Memorandum.
    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'').\38\ However, in October 2009, the 
Department learned that Indian import data obtained from the WTA, as 
published by GTIS, began identifying the original reporting currency 
for India as the U.S. Dollar. The Department then contacted GTIS about 
the change in the original

[[Page 64264]]

reporting currency for India from the Indian Rupee to the U.S. Dollar. 
Officials at GTIS explained that while GTIS obtains data on imports 
into India directly from the Ministry of Commerce, Government of India, 
as denominated and published in Indian Rupees, the WTA software is 
limited with regard to the number of significant digits it can manage. 
Therefore, 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 significant digits when obtaining data 
through the WTA software. GTIS explained that it converts the Indian 
Rupee to the U.S. Dollar using the monthly Federal Reserve exchange 
rate applicable to the relevant month of the data being downloaded and 
converted.\39\
---------------------------------------------------------------------------

    \38\ See 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) (unchanged in Certain 
Preserved Mushrooms From the People's Republic of China: Final 
Results of Antidumping Duty New Shipper Review, 74 FR 65520 
(December 10, 2009)).
    \39\ 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.
---------------------------------------------------------------------------

    However, the data reported in the Global Trade Atlas (``GTA'') 
software published by GTIS reports import statistics, such as from 
India, in the original reporting currency and, thus, these data 
correspond to the original currency value reported by each country. 
Additionally, the data reported in the GTA software are 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 
Department will now obtain import statistics from GTA for valuing 
various FOPs because the GTA import statistics 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.
    We further adjusted material input values to account for freight 
costs incurred between the supplier and respondent. We used the freight 
rates published by http://www.infobanc.com, ``The Great Indian Bazaar, 
Gateway to Overseas Markets.'' The logistics section of the website 
contains inland freight truck rates between many large Indian cities. 
The truck freight rates are for the period August 2008 through July 
2009. See Surrogate Value Memorandum.
    Starbright made raw materials purchases from ME suppliers. 
Therefore, in accordance with our practice outlined in Antidumping 
Methodologies: Market Economy Inputs,\40\ where at least 33 percent of 
an input is sourced from ME suppliers and purchased in an ME currency, 
the Department used actual weighted-average purchase prices to value 
these inputs.\41\ Where the quantity of the input purchased from ME 
suppliers during the period is below 33 percent of the total volume of 
purchases of the input during the period, the Department weight-
averaged the weighted average ME purchase price with an appropriate 
surrogate value.\42\ See Antidumping Methodologies: Market Economy 
Inputs. For a complete description of the factor values we used, see 
the Surrogate Value Memorandum and the Starbright Preliminary Analysis 
Memorandum.
---------------------------------------------------------------------------

    \40\ See Antidumping Methodologies: Market Economy Inputs, 
Expected Non-Market Economy Wages, Duty Drawback; and Request for 
Comments, 71 FR 61716, 61717-19 (October 19, 2006) (``Antidumping 
Methodologies: Market Economy Inputs'').
    \41\ For a detailed description of all actual values used for 
market-economy inputs, see New-Tec Preliminary Analysis Memorandum 
dated concurrently with this notice.
    \42\ We did not accept all of Starbright's claimed market 
economy purchases; however due to the proprietary nature of this 
issue, please see further discussion in the Starbright Preliminary 
Analysis Memorandum.
---------------------------------------------------------------------------

    Where we could not obtain publicly available information 
contemporaneous with the POR with which to value FOPs, we adjusted the 
surrogate values using, where appropriate, the Indian Wholesale Price 
Index (``WPI'') as published in the International Financial Statistics 
of the International Monetary Fund (``IMF'').
    To value electricity, we used 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. See Surrogate Value 
Memorandum.
    To value water, we used the revised Maharashtra Industrial 
Development Corporation (``MIDC'') water rates available at http://www.midcindia.com/water-supply. See Surrogate Value Memorandum.
    The Department valued brokerage and handling 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 transport in India that is published in Doing Business 2010: 
India, published by the World Bank. See Surrogate Value Memorandum.
    To value steam coal, we used data obtained for grades A and B coal 
reported in the December 2007 Coal India Limited Circular. See 
Surrogate Value Memorandum.
    To value warehousing, the Department used values obtained from the 
Board of Jawaharlal Nehru Port Trust's Web site,\43\ a source 
identified and used in the less-than-fair-value investigation of this 
proceeding. See Certain New Pneumatic Off-the-Road Tires From the 
People's Republic of China: Notice of Amended Final Affirmative 
Determination of Sales at Less Than Fair Value and Antidumping Duty 
Order, 73 FR 51624 (Sept. 4, 2008), and accompanying Issues and 
Decision Memorandum at Comment 26. We applied these values to the 
average number of days that Starbright's subject merchandise is in 
inventory. See Surrogate Value Memorandum.
---------------------------------------------------------------------------

    \43\  http://www.jnport.gov.in/CMSPage.aspx?PageID=27.
---------------------------------------------------------------------------

    As a consequence of the decision of the Court of Appeals for the 
Federal Circuit (``Federal Circuit'') in Dorbest Ltd. v. United States, 
604 F. 3d 1363 (Fed. Cir. 2010), the Department is no longer relying on 
the regression-based wage rate described in 19 CFR 351.408(c)(3). The 
Department is continuing to evaluate options for determining labor 
values in light of the recent Federal Circuit decision. For these 
preliminary results, we have calculated an hourly wage rate to use in 
valuing the reported labor input by averaging earnings and/or wages in 
countries that are economically comparable to the PRC and that are 
significant producers of comparable merchandise. To calculate the 
hourly wage data, we used wage rate data reported by the International 
Labor Organization (``ILO''). Because an industry-specific dataset 
relevant to this proceeding exists within the Department's preferred 
ILO source, we will be using industry-specific data to calculate a 
surrogate wage rate for this review, in accordance with section 
773(c)(1) of the Act.
    For this review, the Department has calculated the wage rate using 
a simple average of the data provided to the ILO under Sub-
Classification 25 of the ISIC-Revision \44\ 3 standard by countries

[[Page 64265]]

determined to be both economically comparable and significant producers 
to the PRC. Specifically, the Department finds the two-digit 
description under ISIC-Revision 3 (``Manufacture of Rubber and Plastics 
Products'') to be the best available wage rate surrogate value on the 
record because it is specific and derived from industries that produce 
merchandise comparable to the subject merchandise. For further 
information on the calculation of the wage rate, see the Surrogate 
Value Memorandum.
---------------------------------------------------------------------------

    \44\ The ILO industry-specific data is reported according to the 
International Standard Industrial Classification of all Economic 
Activities (``ISIC'') code, which is maintained by the United 
Nations Statistical Division and is periodically updated. These 
updates are referred to as ``Revisions.'' The ILO, an organization 
under the auspices of the United Nation, utilizes this 
classification for reporting purposes. Currently, wage and earnings 
data are available from the ILO under the following revisions: ISIC-
Rev.2, ISIC-Rev.3, and most recently, ISIC-Rev.4. The ISIC code 
establishes a two-digit breakout for each manufacturing category, 
and also often provides a three- or four-digit sub-category for each 
two-digit category. Depending on the country, data may be reported 
at either the two-, three- or four-digit subcategory. Sub-
Classification 25 of the ISIC-Revision 3 covers ``Manufacture of 
Rubber and Plastics Products''.
---------------------------------------------------------------------------

    To value factory overhead, selling, general, and administrative 
expenses, and profit, we used audited financial statements for the year 
ending March 31, 2009, of Falcon Tyres Ltd., and TVS Srichakra Limited, 
and the financial statement for the year ending December 31, 2008, of 
Goodyear India Limited, Indian producers of comparable merchandise.\45\ 
For these preliminary results, the Department determined not to use 
audited financial statements of Govind Rubber Limited because the 
overwhelming amount of production is cycle tires and tubes, and auto 
tires and tubes accounted for less than 1 percent of production. Based 
upon that information, we find that Govind Rubber Limited does not 
produce comparable merchandise. In addition, the Department has 
declined to use audited financial statements of three other Indian 
producers, JK Industries Ltd., MRF Tyres Ltd. and Balkrishna Industries 
Limited, because there is evidence that each of these companies 
received subsidies under programs previously found by the Department to 
be countervailable.\46\ Nevertheless, the Department may consider other 
publicly available financial statements for the final results, as 
appropriate.
---------------------------------------------------------------------------

    \45\ See Surrogate Value Memorandum.
    \46\ Specifically, JK Industries received subsidies under the 
Sales Tax Deferred from Government of Karnataka program (see page 40 
of its financial statement), found by the Department to be 
countervailable. See Notice of Preliminary Results and Rescission, 
in Part, of Countervailing Duty Administrative Review: Polyethylene 
Terephthalate Film, Sheet, and Strip from India, 71 FR 45037 (August 
8, 2006) (8/8/2006 PET Film). MRF Tyres received subsidies under the 
Export Promotion Capital Goods Scheme (see page 61 of its financial 
statement), found by the Department to be countervailable. See Final 
Affirmative Countervailing Duty Determination: Bottle-Grade 
Polyethylene Terephthalate (PET) Resin From India, 70 FR 13460 
(March 21, 2005) (3/21/2005 PET Resin). Balkrishna Industries 
received subsidies under the Duty Entitlement Passbook Scheme (see 
page 32 of its financial statement), found by the Department to be 
countervailable. See, e.g., 8/8/2006 PET Film and 3/21/2005 PET 
Resin.
---------------------------------------------------------------------------

    In its original questionnaire response, Starbright stated that it 
does not produce any by-products, with the exception of a small amount 
of scrap tires. In a July 14, 2010, supplemental questionnaire, we 
requested that Starbright explain, as requested in the original 
questionnaire, the disposition of its by-products, and that it 
demonstrate the quantities of scrap product produced during the POR. In 
addition we asked Starbright to demonstrate that there is a commercial 
value to its claimed scrap through either sale, or the reintroduction 
into its production process. On August 17, 2010, Starbright provided a 
worksheet purportedly showing scrap production for July 2008; however 
it did not explain the worksheet or tie to any supporting documents. In 
this same response, Starbright also stated that it does not sell or 
reintroduce the scrap tires into production, but, if possible repaired 
and returned them to inventory. Because Starbright clearly and 
repeatedly stated that these scrap tires were neither sold nor re-used 
in production, but simply placed in inventory, it has not demonstrated 
that these scrap tires have any commercial value that would warrant a 
by-product offset.
    On September 1, 2010, the Department requested for the third time 
that Starbright provide documentation to demonstrate the production, 
sale, and/or reintroduction of its scrap tires by-product, whereupon, 
on September 13, 2010, Starbright stated that due to time and staffing 
constraints, it had not been able to prepare the requested information. 
Because Starbright reported that it produced scrap tires but did not 
report or demonstrate that it sold or reintroduced the scrap tires into 
production and thus did not demonstrate either the production or 
commercial value of any such scrap, we have not granted Starbright its 
claimed by-product offset for tire scrap.

Adverse Facts Available

    Sections 776(a)(1) and (2) of the Act provide that the Department 
shall apply ``facts otherwise available'' if, inter alia, necessary 
information is not on the record or an interested party or any other 
person: (A) Withholds information that has been requested; (B) fails to 
provide information within the deadlines established, or in the form 
and manner requested by the Department, subject to subsections (c)(1) 
and (e) of section 782 of the Act; (C) significantly impedes a 
proceeding; or (D) provides information that cannot be verified as 
provided by section 782(i) of the Act.
    Where the Department determines that a response to a request for 
information does not comply with the request, section 782(d) of the Act 
provides that the Department will so inform the party submitting the 
response and will, to the extent practicable, provide that party the 
opportunity to remedy or explain the deficiency. If the party fails to 
remedy the deficiency within the applicable time limits and subject to 
section 782(e) of the Act, the Department may disregard all or part of 
the original and subsequent responses, as appropriate. Section 782(e) 
of the Act provides that the Department ``shall not decline to consider 
information that is submitted by an interested party and is necessary 
to the determination but does not meet all applicable requirements 
established by the administering authority'' if the information is 
timely, can be verified, is not so incomplete that it cannot be used, 
and if the interested party acted to the best of its ability in 
providing the information. Where all of these conditions are met, the 
statute requires the Department to use the information if it can do so 
without undue difficulties.
    Section 776(b) of the Act further provides that the Department may 
use an adverse inference in applying the facts otherwise available when 
a party has failed to cooperate by not acting to the best of its 
ability to comply with a request for information. Section 776(b) of the 
Act also authorizes the Department to use as adverse facts available 
(``AFA'') information derived from the petition, the final 
determination, a previous administrative review, or other information 
placed on the record.
    For the reasons discussed below, we determine that, in accordance 
with sections 776(a)(2) and 776(b) of the Act, the use of partial AFA 
is appropriate for the preliminary results with respect to Starbright.

1. Products with Unreported Factors of Production

    The original questionnaire states: ``if you sold some products/
models during the POR but did not produce them during the POR * * * 
please contact the official in charge before preparing your response to 
this section of the questionnaire.'' \47\ However, in filing its

[[Page 64266]]

questionnaire response, Starbright included several products in the 
reported U.S. sales list in its response to section C of the 
questionnaire for which it failed to provide any factors of production 
in its response to section D.\48\ Furthermore, prior to submitting its 
response, Starbright never contacted the Department regarding this 
matter, despite the instructions in the questionnaire that it do so.
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    \47\ See Letter from the Department to Starbright, ``Antidumping 
Duty Administrative Review of Certain New Pneumatic Off-the-Road 
Tires from the People's Republic of China: Questionnaire,'' dated 
January 22, 2010, at page D-1 (``Questionnaire'').
    \48\ See Starbright's April 27, 2010, sections C and D 
questionnaire response.
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    On July 1, 2010, the Department issued a supplemental questionnaire 
in which it asked Starbright to explain the missing product control 
numbers, and to provide FOPs for the product control numbers included 
in the section C database but missing from the section D database. In 
its August 2, 2010, response to the supplemental section C 
questionnaire, Starbright explained that these products were sold 
during the POR, but not produced during the POR. Starbright further 
stated that it would provide the FOP information for these products in 
its response to the section D supplemental questionnaire.\49\
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    \49\ See Starbright's August 2, 2010, supplemental questionnaire 
response at 5.
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    On August 17, 2010 Starbright provided matching product control 
numbers in its FOP database for the products that it reported were sold 
during the POR but not produced during the POR. Starbright stated that 
it had ``created similars'' for the product control numbers that did 
not have matches in the FOP database, and that it had created a new 
variable in the FOP database for the ``similar'' product control 
number. Starbright also included a chart listing the control numbers 
for the products sold to the United States, and the similar control 
number created by Starbright.\50\ However, based on Starbright's 
explanation that it sold these products during the POR but did not 
produce these products during the POR, it was not clear whether 
Starbright produced the products prior to the POR, or purchased the 
products from another producer and how it derived the FOPs it reported 
for these products (e.g., did they reflect prior year's production, 
production of other products, or something else entirely). Thus, on 
September 1, 2010, in a second section D supplemental questionnaire, 
the Department asked that Starbright explain the origin of the 
merchandise sold during the POR but not produced by Starbright during 
the POR, and that Starbright provide evidence of its attempts to obtain 
FOP information from the producer or the merchandise if the products 
were purchased from another producer. The Department also explained 
that, if Starbright produced these products prior to the POR, it should 
provide the FOPs based on the prior production period (data it should 
have from the period of the investigation).
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    \50\ See Starbright's August 17, 2010, supplemental 
questionnaire response at 1 and Exhibit SD-2.
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    On September 13, 2010, Starbright argued that any request for FOPs 
based on the prior year's production would require a revision to its 
entire FOP database and refused to comply with the Department's request 
for the FOP data from the prior production period. However, Starbright 
failed to explain why having to report the prior year's FOPs for 
products not produced in the current POR would require a revision to 
the entire FOP database, since the prior year's reporting would only be 
necessary for the products sold but not produced during the instant 
POR. Starbright further contended that it was unable to provide the 
requested FOP data in such a short period of time.\51\ Thus, Starbright 
disregarded the clear instructions in the original questionnaire, 
directing it to contact the Department if it had made sales of products 
during the POR that it did not produce during the POR. Starbright also 
refused to provide the information when requested by the Department in 
a supplemental questionnaire regarding the nature of what it had 
reported, thus rendering the data unusable. Moreover, Starbright 
provided no rationale for its creation of ``similar'' product control 
numbers for these products. Consequently, we preliminarily determine 
that partial facts available is warranted because necessary information 
is not on the record and because Starbright failed to provide requested 
information by the applicable deadlines and impeded the proceeding by 
not explaining the derivation of its reported ``similar'' FOPs. Section 
776(a)(1), (a)(2)(B) and (a)(2)(C) of the Act. Moreover, by failing to 
notify the Department of the existence of sales for products not 
produced in the POR, despite the clear instruction in the 
questionnaire, and by failing to provide usable information by the 
appli