Fresh Garlic from the People's Republic of China: Preliminary Results of, Partial Rescission of, and Intent to Rescind, in Part, the 15th Antidumping Duty Administrative Review, 80458-80469 [2010-32166]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 75, Number 245 (Wednesday, December 22, 2010)]
[Notices]
[Pages 80458-80469]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2010-32166]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-831]


Fresh Garlic from the People's Republic of China: Preliminary 
Results of, Partial Rescission of, and Intent to Rescind, in Part, the 
15th Antidumping Duty Administrative Review

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

SUMMARY: The Department of Commerce (Department) is conducting an 
administrative review of the antidumping duty order on fresh garlic 
from the People's Republic of China (PRC) covering the period of review 
(POR), November 1, 2008 through October 31, 2009. The Department 
initiated this review for 84 producers/exporters (companies). Based on 
timely withdrawal of requests for review, the Department is now 
rescinding the review with respect to 54 companies which are listed in 
Attachment I. As such, this review covers the 30 companies listed in 
Attachment II.
    One producer/exporter selected as a mandatory respondent has 
participated fully and has demonstrated its eligibility for a separate 
rate. We preliminarily determine that the respondent sold subject 
merchandise to the United States at prices below normal value (NV). The 
Department has also preliminarily determined that total adverse facts 
available (AFA) is warranted for two mandatory respondents who each 
failed to cooperate to the best of its ability in this proceeding. The 
Department preliminarily grants a separate rate to four companies which 
demonstrated the eligibility for separate rate status. The rates 
assigned to each of these companies, can be found in the ``Preliminary 
Results of Review'' section of this notice. The Department also intends 
to rescind preliminarily the review with respect to seven companies 
which each timely submitted a ``no shipment'' certification. The 
remaining

[[Page 80459]]

fourteen companies for which a review was requested but which failed to 
timely submit a no-shipment certification, or separate rate 
certification or application, are part of the PRC-wide entity. A more 
detailed explanation of the disposition of each of the above companies 
can be found below.
    Interested parties are invited to comment on these preliminary 
results. 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 assessment rates are above de minimis.

DATES: Effective Date: December 22, 2010.

FOR FURTHER INFORMATION CONTACT: Scott Lindsay, David Lindgren, or 
Lingjun Wang, AD/CVD Operations, Office 6, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW., Washington, DC 20230; telephone: 
(202) 482-0780, (202) 482-3870, and (202) 482-2316, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On November 16, 1994, the Department published in the Federal 
Register the antidumping duty order on fresh garlic from the PRC. See 
Antidumping Duty Order: Fresh Garlic From the People's Republic of 
China, 59 FR 59209 (November 16, 1994) (Order). On November 2, 2009, 
the Department published a notice of opportunity to request an 
administrative review of the antidumping duty order on fresh garlic 
from the PRC for the period November 1, 2008 through October 31, 2009. 
See Antidumping or Countervailing Duty Order, Finding, or Suspended 
Investigation; Opportunity to Request Administrative Review, 74 FR 
56573 (November 2, 2009). On November 25, 2009 and November 30, 2009, 
various interested parties timely requested administrative reviews of 
84 garlic producers/exporters.
    On December 23, 2009, the Department initiated an administrative 
review for 84 companies. See Initiation of Antidumping and 
Countervailing Duty Administrative Reviews and Request for Revocation 
in Part, 74 FR 68229, 68230-68231 (December 23, 2009) (Initiation 
Notice).
    On November 25, 2009, Hebei Golden Bird Trading Co., Ltd. (Golden 
Bird), Jining Yongjia Trade Co., Ltd. (Yongjia), Jinxiang Tianheng 
Trade Co., Ltd. (Tianheng), Qingdao Tiantaixing Foods Co., Ltd. (QTF), 
Weifang Chenglong Import & Export Co., Ltd. (Chenglong), each timely 
certified that it had no shipments during the POR. Also, Qingdao Sea-
line International Trading Co. Ltd. (Sea-line) timely certified that it 
had no shipments during the period of May 1, 2009 through October 31, 
2009.\1\ On January 22, 2010, Jinan Yipin Corporation Ltd. (Yipin), 
Shandong Chenhe International Trading Co., Ltd. (Chenhe), Shanghai LJ 
International Trading Co. (Shanghai LJ), Zhengzhou Yuanli Trading Co. 
(Yuanli) each timely certified that it had no shipments during the 
POR.\2\ On March 10, 2010, the Fresh Garlic Producers Association 
(FGPA) and its individual members \3\ (collectively, Petitioners) 
commented on Yongjia and QTF's no shipment representations based on 
publicly available information through the Port Import Export Reporting 
Services (PIERS). On March 19, 2010, Yongjia and QTF responded to 
Petitioners' comments.
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    \1\ Sea-line has an active new shipper review that covers the 
first six months of the POR covered by this administrative review, 
November 1, 2008 through April 30, 2009.
    \2\ On March 11, 2010, Petitioners subsequently withdrew their 
requests to review Tianheng, Chenglong, and Yuanli.
    \3\ The individual members of the FGPA are Christopher Ranch 
L.L.C., The Garlic Company, Valley Garlic, and Vessey and Company, 
Inc.
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    On January 12, 2010, the Department released CBP data to interested 
parties. Comments on the CBP data were due on January 25, 2010. On 
January 22, 2010, Golden Bird and Tianheng reiterated to the Department 
that they did not have any shipments during the POR. See Intent to 
Rescind, In Part, the Administrative Review section below.
    On January 22, 2010, Henan Weite Industrial Co., Ltd. (Henan 
Weite), Jinan Farmlady Trading Co., Ltd. (Farmlady), Qingdao 
Xintianfeng Foods Co., Ltd. (QXF), Shandong Longtai Fruits and 
Vegetables Co., Ltd. (Longtai), Weifang Hongqiao International Logistic 
Co., Ltd. (Hongqiao), and Zhenzhou Harmoni Spice Co., Ltd. (Harmoni) 
each timely submitted a separate rate certification.\4\ On January 13, 
2010, Shenzhen Greening Trading Co., Ltd. (Shenzhen Greening) timely 
submitted a separate rate certification. On February 28, 2010, Shenzhen 
Greening also timely submitted a separate rate application.
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    \4\ Petitioners subsequently withdrew their requests to review 
Henan Weite and Harmoni.
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    On February 12, 2010, the Department issued a memorandum that 
tolled the deadlines for all Import Administration cases by seven 
calendar days due to the Federal Government closure. See Memorandum for 
the Record from Ronald Lorentzen, DAS for Import Administration, 
Tolling of Administrative Deadlines as a Result of the Government 
Closure During the Recent Snowstorm, dated February 12, 2010. On March 
1, 2010, in accordance with section 777A(c)(2) of the Tariff Act of 
1930, as amended (the Act), the Department selected the following four 
companies as mandatory respondents for individual examination in this 
review: Jinxiang Tianma Freezing Storage Co., Ltd. (Tianma Freezing), 
Shenzhen Xinboda Industrial Co., Ltd. (Shenzhen Xinboda), Shenzhen 
Greening and Harmoni. See Memorandum from Scott Lindsay, International 
Trade Analyst, Office 6, Re: Antidumping Administrative Review of Fresh 
Garlic from the People's Republic of China: Respondent Selection 
Memorandum (March 1, 2010) (Respondent Selection Memorandum), available 
on file in the Central Records Unit, Room 7046 of the Department's main 
building.
    On March 8, 2010, the Department issued antidumping questionnaires 
(initial questionnaire) to the four mandatory respondents. On March 11, 
2010 and March 30, 2010, Petitioners timely withdrew their requests to 
review 54 companies. See Attachment I. Jinxiang Hejia Co. Ltd. (Hejia) 
withdrew its own review request on January 13, 2010. However, since 
Petitioners also requested a review of Hejia, that review continues. On 
March 30, 2010, Zhengzhou Harmoni Spice Co. Ltd. (Harmoni) withdrew its 
own review request in addition to Petitioners' withdrawal request. 
Shenzhen Greening and Tianma Freezing did not respond to the initial 
questionnaire, nor did they request any extension or state that they 
were having difficulty in responding to the questionnaire. On April 19, 
2010, April 26, 2010, and May 4, 2010, Shenzhen Xinboda submitted 
responses to the initial questionnaire.\5\ On July 21, 2010, 
Petitioners commented on these responses. On September 17, 2010, and 
November 17, 2010, Shenzhen Xinboda submitted responses to the first 
and second supplemental questionnaires.
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    \5\ The Department granted several extensions for various 
sections of the initial questionnaire.
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    On April 9, 2010, Petitioners requested that the Department conduct 
verification of the factual information placed on the record of this 
proceeding by the mandatory respondents. On June 8, 2010, the 
Department extended the deadline for the preliminary results of this 
administrative review until December 7, 2010. See Fresh Garlic From The 
People's Republic of China: Extension of Time Limit for Preliminary 
Results of Antidumping Duty

[[Page 80460]]

Administrative Review, 75 FR 32361 (June 8, 2010).
    On July 20, 2010, the Department provided all interested parties 
the opportunity to submit any information they wanted the Department to 
consider when selecting the surrogate country and surrogate values. On 
October 19, 2010, Petitioners and Shenzhen Xinboda submitted their 
respective surrogate data. On October 29, 2010, both parties commented 
on the other parties' surrogate data.

Period of Review

    The POR is November 1, 2008 through October 31, 2009.

Scope of the Order

    The products covered by the order are all grades of garlic, whole 
or separated into constituent cloves, whether or not peeled, fresh, 
chilled, frozen, provisionally preserved, or packed in water or other 
neutral substance, but not prepared or preserved by the addition of 
other ingredients or heat processing. The differences between grades 
are based on color, size, sheathing, and level of decay. The scope of 
this order does not include the following: (a) Garlic that has been 
mechanically harvested and that is primarily, but not exclusively, 
destined for non-fresh use; or (b) garlic that has been specially 
prepared and cultivated prior to planting and then harvested and 
otherwise prepared for use as seed. The subject merchandise is used 
principally as a food product and for seasoning. The subject garlic is 
currently classifiable under subheadings 0703.20.0010, 0703.20.0020, 
0703.20.0090, 0710.80.7060, 0710.80.9750, 0711.90.6000, and 
2005.90.9700 of the Harmonized Tariff Schedule of the United States 
(HTSUS). Although the HTSUS subheadings are provided for convenience 
and customs purposes, our written description of the scope of this 
order is dispositive. In order to be excluded from the order, garlic 
entered under the HTSUS subheadings listed above that is (1) 
mechanically harvested and primarily, but not exclusively, destined for 
non-fresh use or (2) specially prepared and cultivated prior to 
planting and then harvested and otherwise prepared for use as seed must 
be accompanied by declarations to CBP to that effect.

Partial Rescission of the Administrative Review

    Pursuant to 19 CFR 351.213(d)(1), the Secretary will rescind an 
administrative review, in whole or in part, if a party that requested 
the review withdraws the request within 90 days of the date of 
publication of the initiation notice of the requested review. Further, 
pursuant to 19 CFR 351.213(d)(1), the Department is permitted to extend 
this time if it is reasonable to do so.
    For all but one of the 54 companies listed in Attachment II, 
Petitioners were the only party that requested the review. With respect 
to one other company, Harmoni, both Harmoni and Petitioners requested a 
review of Harmoni. On March 30, 2010, both Petitioners and Harmoni 
timely withdrew their respective review requests.\6\ Therefore, in 
accordance with 19 CFR 351.213(d)(1), we are rescinding this review 
with respect to all 54 companies named in the Attachment II.
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    \6\ On August 16, 2010, Farmlady urged the Department to 
determine whether Harmoni had any business dealings with Petitioners 
before any final rescission. The regulations are clear that so long 
as the parties that requested the review withdrew the request, the 
Secretary will rescind the review. Since both withdrawal requests 
were timely, the Department has no basis to evaluate the reasoning 
behind party's decision to withdraw its request. Furthermore, 
Farmlady provided no evidence to support its claim that there have 
been business dealings between Petitioners and Harmoni.
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Intent To Rescind, in Part, the Administrative Review

    Under 19 CFR 351.213(d)(3), the Department may rescind a review 
where there are no exports, sales, or entries of subject merchandise 
during the respective period of review listed below. In the Initiation 
Notice, the Department stated that any company named in the notice of 
initiation that had no exports, sales, or entries during the period of 
review should notify the Department within 30 days of publication of 
the Initiation Notice in the Federal Register. The Department stated 
that it would consider rescinding the review only if the company 
submitted a properly filed and timely statement certifying that it had 
no exports, sales, or entries of subject merchandise during the period 
of review. See Initiation Notice. The deadline to submit ``no 
shipment'' certifications was January 22, 2010.
    As noted above, Golden Bird, Yipin, Yongjia, QTF, Chenhe, and 
Shanghai LJ each timely certified that it had no shipments during the 
POR. Also, Sea-line timely certified that it had no shipments during 
the period May 1, 2009 through October 31, 2009. The Department issued 
``no-shipment'' inquires to CBP and received one response regarding 
Golden Bird.
    On January 22, 2010, Golden Bird and Tianheng reiterated that their 
certifications are accurate.\7\ The Department examined Golden Bird's 
detailed transaction information provided by CBP, and also invited 
parties to comment. See Memorandum from Scott Lindsay, Re: Antidumping 
Administrative Review of Fresh Garlic from the People's Republic of 
China: Placing Additional Customs and Border Protection (CBP) Data on 
the Record (November 10, 2010). On November 29, 2010, Golden Bird 
submitted comments continuing to argue that its no-shipment 
certification was accurate. Based on the evidence on the record, the 
Department preliminarily determines that Golden Bird did not have any 
garlic shipments enter the United States during the POR.
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    \7\ Petitioners subsequently withdrew their request to review 
Tianheng, so it became unnecessary to further examine Tianheng's no-
shipment certification.
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    On March 10, 2010, Petitioners questioned the accuracy of Yongjia 
and QTF's no-shipment statement based on PIERS data. On March 19, 2010, 
Yongjia and QTF responded to Petitioners' comments by challenging the 
accuracy of PIERS data. The Department examined the detailed 
transaction information provided by CBP. See Memorandum from Scott 
Lindsay, Re: Antidumping Administrative Review of Fresh Garlic from the 
People's Republic of China: Placing Additional Customs and Border 
Protection (CBP) Data on the Record (November 24, 2010). Based on the 
evidence on the record, the Department preliminarily determines that 
Yongjia and QTF did not have any garlic shipments enter the United 
States during the POR.
    When examining a no-shipment certification, the Department's 
practice is to: (1) Review the respondent's no shipment claim; (2) 
examine CBP entry data to determine whether these data are consistent 
with the claim; and (3) send a ``No Shipment Inquiry'' to CBP 
requesting that CBP notify the Department if it has evidence of 
shipments from the company making the claim. After taking these three 
steps, the Department has found no evidence on the record to indicate 
that these companies had exports, entries, or sales of subject 
merchandise under this order during the POR, pursuant to 19 CFR 
351.213(d)(3). Therefore, the Department is preliminarily rescinding 
the review with respect to Golden Bird, Yipin, Yongjia, QTF, Chenhe, 
Sea-line, and Shanghai LJ.

Non-Market Economy Country Status

    In every case conducted by the Department involving the PRC, the 
PRC has been treated as a non-market economy (NME) country. In 
accordance with section 771(18)(c)(i) of the Act, any determination 
that a foreign country is an NME country shall remain in effect until 
revoked by the administering authority. See, e.g., Brake Rotors From

[[Page 80461]]

the People's Republic of China: Final Results and Partial Rescission of 
the 2004/2005 Administrative Review and Notice of Rescission of 2004/
2005 New Shipper Review, 71 FR 66304 (November 14, 2006). None of the 
parties to this proceeding have contested such treatment. Accordingly, 
we calculated NV in accordance with section 773(c) of the Act, which 
applies to NME countries.

Separate Rates

    As noted above, designation of a country as an NME remains in 
effect until it is revoked by the Department. See section 771(18)(c)(i) 
of the Act. Accordingly, there is a rebuttable presumption that all 
companies within the PRC are subject to government control and, thus, 
should be assessed a single antidumping duty rate.
    It is the Department's standard policy to assign all exporters of 
the merchandise subject to review in NME countries a single rate unless 
an exporter can affirmatively demonstrate an absence of government 
control, both in law (de jure) and in fact (de facto), with respect to 
its exports. To establish whether a company is sufficiently independent 
to be eligible for a separate, company-specific rate, the Department 
analyzes each exporting entity in an NME country under the test 
established in the Final Determination of Sales at Less than Fair 
Value: Sparklers From the People's Republic of China, 56 FR 20588 (May 
6, 1991) (Sparklers), as amplified by the Notice of Final Determination 
of Sales at Less Than Fair Value: Silicon Carbide From the People's 
Republic of China, 59 FR 22585 (May 2, 1994) (Silicon Carbide).
    In the Initiation Notice, the Department stated that all firms that 
wish to qualify for separate-rate status in the administrative reviews 
involving NME countries must complete, as appropriate, either a 
separate-rate application or certification, as described below. For 
these administrative reviews, in order to demonstrate separate-rate 
eligibility, the Department requires entities for which a review was 
requested, that were assigned a separate rate in the most recent 
segment of this proceeding in which they participated, to certify that 
they continue to meet the criteria for obtaining a separate rate. In 
this administrative review, Farmlady, QXF, Longtai, and Hongqiao each 
submitted a separate-rate certification. Although Shenzhen Xinboda did 
not submit a separate rate certification, as a cooperating mandatory 
respondent, it did answer all the separate rate questions in our 
questionnaires. As such, Shenzhen Xinboda, Farmlady, QXF, Longtai, and 
Hongqiao each provided company-specific information and each stated 
that it met the criteria for the assignment of a separate rate. We 
considered whether Shenzhen Xinboda, Farmlady, QXF, Longtai, and 
Hongqiao were eligible for a separate rate.
    The Department's separate-rate status test to determine whether the 
exporter is independent from government control does not consider, in 
general, macroeconomic/border-type controls (e.g., export licenses, 
quotas, and minimum export prices), particularly if these controls are 
imposed to prevent dumping. The test focuses, rather, on controls over 
the investment, pricing, and output decision-making process at the 
individual firm level. See Notice of Final Determination of Sales at 
Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate From 
Ukraine, 62 FR 61754, 61758 (November 19, 1997), and Tapered Roller 
Bearings and Parts Thereof, Finished and Unfinished, From the People's 
Republic of China; Final Results of Antidumping Administrative Review, 
62 FR 61276, 61279 (November 17, 1997).

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.
    Shenzhen Xinboda, Farmlady, QXF, Longtai, and Hongqiao each 
certified that, consistent with the most recent segment of this 
proceeding in which it participated and was granted a separate rate, 
there is an absence of de jure government control of its exports.\8\ 
Each of these companies certified to its separate-rate status, and 
stated, where applicable, that the company had no relationship with any 
level of the PRC government with respect to ownership, internal 
management, and business operations. In this segment, we have no new 
information on the record that would cause us to reconsider the 
previous de jure control determinations with regard to these companies. 
Thus, we find that evidence on the record supports a preliminary 
finding of an absence of de jure government control with regard to the 
export activities of Shenzhen Xinboda, Farmlady, QXF, Longtai, and 
Hongqiao.
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    \8\ The most recently completed segment of this proceeding in 
which Xintianfeng and Hongqiao participated and were granted 
separate rate status was Fresh Garlic from the People's Republic of 
China: Final Results and Partial Rescission of the 14th Antidumping 
Duty Administrative Review, 75 FR 34976 (June 21, 2010). The most 
recently completed segment of this proceeding in which Longtai and 
Farmlady participated and was granted separate rate status was Fresh 
Garlic from the People's Republic of China: Final Results and 
Partial Rescission of the 12th Administrative Review, 73 FR 34251 
(June 17, 2008).
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B. Absence of De Facto Control

    As stated in previous cases, there is evidence that certain 
enactments of the PRC central government have not been implemented 
uniformly among different sectors and/or jurisdictions in the PRC. See 
Silicon Carbide, 59 FR at 22586-87. Therefore, the Department has 
determined that an analysis of de facto control is critical in 
determining whether the respondents are, in fact, subject to a degree 
of government control which would preclude the Department from 
assigning separate rates.
    The absence of de facto government control over exports is based on 
whether a company: (1) Sets its own export prices independent of the 
government and other exporters; (2) retains the proceeds from its 
export sales and makes independent decisions regarding the disposition 
of profits or financing of losses; (3) has the authority to negotiate 
and sign contracts and other agreements; and (4) has autonomy from the 
government regarding the selection of management. See, e.g., Silicon 
Carbide, 59 FR at 22587, and Sparklers, 56 FR at 20589; 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).
    Shenzhen Xinboda, Farmlady, QXF, Longtai, and Hongqiao each timely 
submitted a certification of its separate-rate eligibility which stated 
that, as with the previous period where each company was granted a 
separate rate; there is an absence of de facto government control of 
each company's exports. Their separate rate certifications, stated, 
where applicable, that they had no relationship with any level of the 
PRC government with respect to ownership, internal management, and 
business operations. In this segment, we have no new information on the 
record that would cause us to reconsider the previous period's de facto 
control determinations with regard to these companies. Therefore, the 
Department preliminarily finds that Shenzhen Xinboda, Farmlady, QXF, 
Longtai, and Hongqiao have established, prima facie, that they qualify 
for separate rates under the

[[Page 80462]]

criteria established by Silicon Carbide and Sparklers.

Surrogate Country

    When the Department investigates imports from an NME country, 
section 773(c)(1) of the Act directs it to base NV on the NME 
producer's factors of production (FOPs), valued in a surrogate market 
economy country or countries considered to be appropriate by the 
Department. In accordance with section 773(c)(4) of the Act, in valuing 
the FOPs, the Department shall utilize, to the extent possible, the 
prices or costs of FOPs in one or more market economy countries that 
are: (1) At a level of economic development comparable to that of the 
NME country; and (2) significant producers of comparable merchandise. 
Moreover, it is the Department's practice to select an appropriate 
surrogate country based on the availability and reliability of data 
from the countries. See Department Policy Bulletin No. 04.1: Non-Market 
Economy Surrogate Country Selection Process (March 1, 2004) (Policy 
Bulletin).
    As discussed in the ``Non-Market Economy Country Status'' section 
above, the Department considers the PRC to be an NME country. Pursuant 
to section 773(c)(4) of the Act, the Department determined that India, 
Philippines, Indonesia, Thailand, Ukraine, and Peru are countries 
comparable to the PRC in terms of economic development. See Memorandum 
to All Interested Parties Re: 15th Administrative Review of Fresh 
Garlic from the People's Republic of China (July 20, 2010) at 
Attachment 1.
    Also, in accordance with section 773(c)(4) of the Act, the 
Department has found that India is a significant producer of comparable 
merchandise. Moreover, the Department finds India to be a reliable 
source for surrogate values (SVs) because India is at a similar level 
of economic development, is a significant producer of comparable 
merchandise, and has publicly available and reliable data. Furthermore, 
the Department notes that India has been the primary surrogate country 
in past segments of this proceeding, and the only SV data submitted on 
the record are from Indian sources. Given the above facts, the 
Department has selected India as the primary surrogate country for this 
review. The sources of the SVs are discussed under the ``Normal Value'' 
section below and in the Memorandum from Scott Lindsay, Re: Preliminary 
Results of the 2008-2009 Administrative Review of Fresh Garlic from the 
People's Republic of China: Surrogate Values Memorandum (December 7, 
2010) (SV Memorandum). No parties submitted comments concerning 
selection of the surrogate country.

U.S. Price

    In accordance with section 772(a) of the Act, we calculated export 
prices (EP) for Shenzhen Xinboda's sales to the United States because 
they were made to unaffiliated parties before the date of importation. 
We calculated Shenzhen Xinboda's EP based on its price to unaffiliated 
purchasers in the United States. In accordance with section 772(c) of 
the Act, where appropriate, we deducted movement expenses (e.g. foreign 
inland freight, international freight, brokerage and handling, marine 
insurance, warehousing, and U.S. customs duties) from the starting 
price to unaffiliated purchasers. For the expenses that were either 
provided by an NME vendor or paid for with an NME currency, we used SVs 
as appropriate. See the ``Factor Valuations'' section below for details 
regarding the SV for movement expenses.

Normal Value

A. Methodology

    Section 773(c)(1)(B) of the Act provides that the Department shall 
determine NV using an FOP methodology if the merchandise is exported 
from an NME country 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 calculates NV 
using each of the FOPs that a respondent consumes in the production of 
a unit of the subject merchandise because the presence of government 
controls on various aspects of NMEs renders price comparisons and the 
calculation of production costs invalid under the Department's normal 
methodologies. However, there are circumstances in which the Department 
will modify its standard FOP methodology, choosing to apply SVs to an 
intermediate input instead of the individual FOPs used to produce that 
intermediate input. In some cases, a respondent may report factors used 
to produce an intermediate input that accounts for an insignificant 
share of total output. When the potential increase in accuracy to the 
overall calculation that results from valuing each of the FOPs is 
outweighed by the resources, time, and burden such an analysis would 
place on all parties to the proceeding, the Department has valued the 
intermediate input directly using SVs. See, e.g., Notice of Final 
Determination of Sales at Less Than Fair Value: Polyvinyl Alcohol from 
the People's Republic of China, 68 FR 47538 (August 11, 2003), and 
accompanying Issues and Decision Memorandum at Comment 1 (PVA) (citing 
to Final Results of First New Shipper Review and First Antidumping Duty 
Administrative Review: Certain Preserved Mushrooms From the People's 
Republic of China, 66 FR 31204 (June 11, 2001)).
    For the final results of several prior administrative reviews (ARs) 
and new shipper reviews (NSRs) under the garlic order,\9\ the 
Department found that garlic industry producers in the PRC do not 
generally track actual labor hours incurred for growing, tending, and 
harvesting activities and, thus, do not maintain appropriate records 
which would allow most, if not all, respondents to quantify, report, 
and substantiate this information. In the preliminary results of the 
eleventh AR and NSRs, the Department also stated that ``should a 
respondent be able to provide sufficient factual evidence that it 
maintains the necessary information in its internal books and records 
that would allow us to establish the completeness and accuracy of the 
reported FOPs, we will revisit this issue and consider whether to use 
its reported FOPs in the calculation of NV.'' See Fresh Garlic from the 
People's Republic of China: Partial Rescission and Preliminary Results 
of the Eleventh Administrative Review and New Shipper Reviews, 71 FR 
71510, 71520 (December 11, 2006).
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    \9\ See e.g., Fresh Garlic from the People's Republic of China: 
Final Results and Partial Rescission of the Eleventh Administrative 
Review and New Shipper Reviews, 72 FR 34438 (June 22, 2007); Fresh 
Garlic from the People's Republic of China: Final Results and 
Partial Rescission of the 12th Administrative Review, 73 FR 34251 
(June 17, 2008) (12th AR); Fresh Garlic from the People's Republic 
of China: Final Results and Rescission, In Part, of Twelfth New 
Shipper Reviews, 73 FR 56550 (September 29, 2008); and Fresh Garlic 
From the People's Republic of China: Final Results and Partial 
Rescission of the 13th Antidumping Duty Administrative Review and 
New Shipper Reviews, 74 FR 29174 (June 19, 2009) (13th 
Administrative Review).
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    In the course of this review, Zhengzhou Dadi Garlic Industry Co., 
Ltd. (Zhengzhou Dadi), Shenzhen Xinboda's producer, did not report FOPs 
related to growing whole garlic bulbs. As such, for the reasons 
outlined in the Memorandum from Scott Lindsay, Re: 15th Administrative 
Review of Fresh Garlic from the People's Republic of China: 
Intermediate Input Methodology (December 7, 2010) (Intermediate Input 
Methodology Memorandum), the Department is applying an ``intermediate-
input product valuation methodology'' to calculate Shenzhen Xinboda's 
NV. Using this methodology,

[[Page 80463]]

the Department calculated NV by starting with an SV for the garlic bulb 
(i.e., the ``intermediate product''), adjusting for yield losses during 
the processing stages, and adding Shenzhen Xinboda's costs, which were 
calculated using its reported usage rates for processing fresh garlic. 
See Intermediate Input Methodology Memorandum.

B. Factor Valuations

    In accordance with section 773(c) of the Act, the Department 
calculated NV based on the FOP data reported by Shenzhen Xinboda for 
the POR. We relied on the factor-specific data submitted by Shenzhen 
Xinboda for the production inputs in their questionnaire responses, 
where applicable, for purposes of selecting SVs. To calculate NV, the 
Department multiplied the reported per-unit factor consumption rates by 
publicly available India SVs.
    In selecting the SVs, consistent with our past practice, the 
Department considered the quality, specificity, and contemporaneity of 
the data. See, e.g., Folding Metal Tables and Chairs from the People's 
Republic of China; Final Results of Antidumping Duty Administrative 
Review, 71 FR 71509 (December 11, 2006), and accompanying Issues and 
Decision Memorandum at Comment 9. As appropriate, the Department 
adjusted input prices by including freight costs to make them delivered 
prices. Specifically, the Department added to the SVs, as appropriate, 
a surrogate freight cost using the shorter of the reported distance 
from the domestic suppliers to the factory or the distance from the 
nearest seaport to the factory. This adjustment is in accordance with 
the decision of the U.S. Court of Appeals for the Federal Circuit 
(CAFC). See Sigma Corp. v. United States, 117 F.3d 1401, 1408 (Fed. 
Cir. 1997). Where necessary, we adjusted the SVs for inflation/
deflation using the Wholesale Price Index (WPI) as published in the 
International Monetary Fund's International Financial Statistics, 
available at https://ifs.apdi.net/imf. For more information regarding 
the Department's valuation for the various FOPs, see SV Memorandum.
Garlic Bulb Valuation
    The Department's practice when selecting the ``best available 
information'' for valuing FOPs, in accordance with section 773(c)(1) of 
the Act,\10\ is to select, to the extent practicable, SVs which are 
publicly available, product-specific, representative of a broad market 
average, tax-exclusive and contemporaneous with the POR. See e.g., 
Final Determination of Sales at Less Than Fair Value: Certain Artist 
Canvas from the People's Republic of China, 71 FR 16116 (March 30, 
2006) and accompanying Issues and Decision Memorandum at Comment 2.
---------------------------------------------------------------------------

    \10\ Section 773(c)(1)(B) of the Act states that ``the valuation 
of the factors of production shall be based on the best available 
information regarding the values of such factors in a market economy 
country or countries considered to be appropriate by the 
administering authority.''
---------------------------------------------------------------------------

    As discussed above, the Department is applying an intermediate 
input methodology for Shenzhen Xinboda. Therefore, we sought to 
identify the best available SV for the garlic bulb input into 
production. See Petitioners' Submission Concerning Surrogate Values for 
Factors of Production and Shenzhen Xinboda's Surrogate Value 
Submission; see also, SV Memorandum. For the preliminary results of 
this review, we find that data from the Azadpur APMC's ``Market 
Information Bulletin'' are the most appropriate information available 
to value Shenzhen Xinboda's garlic bulb input.
    In its responses to the first and second supplemental 
questionnaires, Shenzhen Xinboda stated that its ``document system, 
including inventory system and accounting system, does not record the 
different sizes of garlic bulbs;'' and ``normally uses garlic bulbs of 
5 cm to 5.5 cm for the production of peeled garlic.'' Consistent with 
our findings in the twelfth AR, the Department continues to find that 
garlic bulb sizes that range from 55 mm and above are Grade Super-A, 
and garlic bulb sizes that range between 40 mm and 55 mm are Grade A 
and Grade Super-A. We have used Grade A and Grade Super A for garlic 
bulb valuation. See SV Memorandum. Because the Grade Super-A prices 
reported by the APMC which are on the record of this review are from 
2007-2008, we inflated them to make them contemporaneous to our POR. 
See SV Memorandum.
Other Factors of Production
    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). 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)). 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 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. 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 those 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 has 
obtained 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.
    Furthermore, with regard to the GTA Indian import-based SVs, in 
accordance with the Omnibus Trade and Competitiveness Act of 1988 
legislative history, the Department continues to apply its long-
standing practice of disregarding SVs if it has a reason to believe or 
suspect the source data may

[[Page 80464]]

be subsidized.\11\ In this regard, the Department has previously found 
that it is appropriate to disregard such prices from Indonesia, South 
Korea and Thailand, because we have determined that these countries 
maintain broadly available, non-industry specific export subsidies. 
See, e.g., Certain Cut-to-Length Carbon-Quality Steel Plate From 
Indonesia: Final Results of Expedited Sunset Review, 70 FR 45692 
(August 8, 2005), and accompanying Issues and Decision Memorandum at 4; 
Corrosion-Resistant Carbon Steel Flat Products From the Republic of 
Korea: Final Results of Countervailing Duty Administrative Review, 74 
FR 2512 (January 15, 2009), and accompanying Issues and Decision 
Memorandum at 17, 19-20; and Final Affirmative Countervailing Duty 
Determination: Certain Hot-Rolled Carbon Steel Flat Products From 
Thailand, 66 FR 50410 (October 3, 2001), and accompanying Issues and 
Decision Memorandum at 23. Based on the existence of these subsidy 
programs that were generally available to all exporters and producers 
in Indonesia, South Korea, and Thailand at the time of the POR, the 
Department finds that it is reasonable to infer that all exporters from 
these countries may have benefitted from these subsidies. We also 
disregarded prices from NME countries \12\ and those imports that were 
labeled as originating from an ``unspecified'' country from the average 
Indian import values, because we could not be certain that they were 
not from either an NME or a country with general export subsidies.
---------------------------------------------------------------------------

    \11\ 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.
    \12\ The NME countries are Armenia, Azerbaijan, Belarus, 
Georgia, Kyrgyz Republic, Moldova, North Korea, the People's 
Republic of China, Tajikistan, Turkmenistan, Uzbekistan, and 
Vietnam.
---------------------------------------------------------------------------

    We valued the packing material inputs using weighted-average unit 
import values derived from the Monthly Statistics of the Foreign Trade 
of India (MSFTI), as published by the Directorate General of Commercial 
Intelligence and Statistics of the Ministry of Commerce and Industry, 
Government of India, and compiled by the GTA.
    The Department valued surrogate truck freight cost by using a per-
unit average rate calculated from April 2009 data on the following Web 
site: https://www.infobanc.com/logistics/logtruck.htm. See Polyethylene 
Retail Carrier Bags From the People's Republic of China: Preliminary 
Results of Antidumping Duty Administrative Review, 73 FR 52282, 52286 
(September 9, 2008) (unchanged in Polyethylene Retail Carrier Bags From 
the People's Republic of China: Final Results of Antidumping Duty 
Administrative Review, 74 FR 6857 (February 11, 2009)); and SV 
Memorandum at Attachment 9.
    To value electricity, the Department used March 2008 electricity 
price rates from Electricity Tariff & Duty and Average Rates of 
Electricity Supply in India, published by the Central Electricity 
Authority of the Government of India. Because these data are not 
contemporaneous with the POR, we inflated March 2008 prices to make 
them contemporaneous to our POR. See SV Memorandum.
    We valued brokerage and handling expenses using a price list of 
export procedures necessary to export a standardized cargo of goods in 
India. The price list is compiled based on a survey case study of the 
procedural requirements for trading a standard shipment of goods by 
ocean transport in India that is published in Doing Business 2010: 
India, published by the World Bank. See SV Memorandum.
    The Department is continuing to evaluate options for determining 
labor values in light of the recent Court of Appeals for the Federal 
Circuit (CAFC) decision. See Dorbest Ltd. v. United States, 604 F.3d 
1363, 1372 (Fed. Cir. 2010). For these preliminary results, we have 
calculated an hourly wage rate to use in valuing respondent reported 
labor input by averaging industry-specific earnings and/or wages in 
countries that are economically comparable to the PRC and that are 
significant producers of comparable merchandise.
    For the preliminary results of this AR, the Department is valuing 
labor using a simple average industry-specific wage rate using earnings 
or wage data reported under Chapter 5B by the International Labor 
Organization (ILO). To achieve an industry-specific labor value, we 
relied on industry-specific labor data from the countries we determined 
to be both economically comparable to the PRC, and significant 
producers of comparable merchandise. Specifically, for this review, the 
Department has calculated the wage rate using a simple average of the 
data provided to the ILO under Sub-Classification 15 of the ISIC-
Revision 3 standard by countries determined to be both economically 
comparable to the PRC and significant producers of comparable 
merchandise. The Department finds the two-digit description under ISIC-
Revision 3 (``Manufacture of Food Products and Beverages'') to be the 
best available wage rate SV on the record because it is specific and 
derived from industries that produce merchandise comparable to the 
subject merchandise. A full description of the industry-specific wage 
rate calculation methodology is provided in the SV Memorandum. 
Consequently, we averaged the ILO industry-specific wage rate data or 
earnings data available from the following countries found to be 
economically comparable to the PRC and to be significant producers of 
comparable merchandise: Ecuador, Egypt, Indonesia, Jordan, Peru, 
Philippines, Thailand, and Ukraine. Further information on the 
calculation of the wage rate can be found in the SV Memorandum. The 
resulting wage rate is $1.36.
Financial Ratios
    Petitioners and Shenzhen Xinboda submitted factual information 
regarding surrogate financial ratios. See Petitioners' Submission 
Concerning Surrogate Values for Factors of Production and Shenzhen 
Xinboda's Surrogate Value Submission. After analyzing these comments 
and factual information, the Department has preliminarily determined 
that it is appropriate to calculate a single set of surrogate financial 
ratios applicable to the production and sales of all subject 
merchandise (both whole and peeled garlic) for these preliminary 
results using both Tata Tea Ltd.'s (Tata Tea) and Limtex Ltd.'s 
(Limtex) financial data. Since the 2002-2003 administrative review, the 
Department has considered tea processing to be sufficiently similar to 
garlic processing in that neither product is highly processed or 
preserved prior to sale. See Fresh Garlic From the People's Republic of 
China: Final Results of Antidumping Duty Administrative Review, 70 FR 
34082 (June 13, 2005), and accompanying Issues and Decision Memorandum 
at 34-35. Moreover, we note that it is the Department's preference to 
use financial data from more than one surrogate producer to reflect the 
broader experience of the surrogate industry. See, e.g., Brake Rotors 
From the People's Republic of China: Final Results and Partial 
Rescission of the Sixth Antidumping Duty Administrative Review and 
Final Results of the Ninth New Shipper Review, 69 FR 42039 (July 13, 
2004), and accompanying Issues and Decision Memorandum at Comment 2; 
see also Final Results of First New Shipper Review and First 
Antidumping Duty Administrative Review: Certain Preserved Mushrooms 
From the People's Republic of China, 66 FR 31204 (June 11, 2001), and 
accompanying Issues and Decision Memorandum at Comment 3,

[[Page 80465]]

and 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 13. We find that 
calculating an average of these two Indian tea processors' data 
provides financial ratios that best reflect the broader experience of 
the garlic industry and that are consistent with our practice during 
previous reviews. See Fresh Garlic From the People's Republic of China: 
Final Results of New Shipper Review, 75 FR 61130 (October 4, 2010), and 
accompanying Issues and Decision Memorandum at Comment 4. The 
Department finds that both Tata Tea's and Limtex's non-integrated 
production process is similar to that of the garlic industry. We find 
that the resulting financial ratios from the average of Tata Tea's and 
Limtex's financial data provide the best surrogate for the garlic 
industry in the PRC as a whole, based on the information on the record 
of this review. See SV Memorandum.

Margin for the Separate Rate Companies

    As discussed above, the Department has preliminarily determined 
that Farmlady, QXF, Longtai, and Hongqiao have demonstrated their 
eligibility for separate rate status. 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 facts available (FA). 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)). For this administrative review, the Department has calculated a 
positive margin for the single mandatory respondent, Shenzhen Xinboda. 
Accordingly, for the preliminary results, consistent with our practice, 
the Department has preliminarily determined that the margin to be 
assigned to Farmlady, QXF, Longtai, and Hongqiao should be the rate 
calculated for the single mandatory respondent, Shenzhen Xinboda.

PRC-Wide Entity

    The Initiation Notice states ``{F{time} or exporters and producers 
who submit a separate-rate status application or certification and 
subsequently are selected as mandatory respondents, these exporters and 
producers will no longer be eligible for separate-rate status unless 
they respond to all parts of the questionnaire as mandatory 
respondents.'' Shenzhen Greening, who after timely submitting separate 
rate documents did not respond to the initial questionnaire, will 
remain part of the PRC-wide entity. Tianma Freezing, who also did not 
respond to the initial questionnaire, will remain part of the PRC-wide 
entity. In addition, the Initiation Notice specifically initiated 
reviews by name for 16 companies which were not selected as mandatory 
respondents and which did not submit separate rate documentation. The 
Department finds these companies failed to demonstrate their 
eligibility for separate rate status. Accordingly, the Department 
considers these companies part of the PRC-wide entity. See Attachment 
III.

Facts Otherwise Available and Adverse Facts Available

    Sections 776(a)(1) and (2) of the Act provide that, if necessary 
information is not available on the record, or if an interested party 
or any other person (A) withholds information that has been requested 
by the administering authority; (B) fails to provide such information 
in a timely matter or in the form or manner requested subject to 
subsections 782(c)(1) and (e) of the Act; (C) significantly impedes a 
proceeding under the antidumping statute; or (D) provides such 
information but the information cannot be verified as provided in 
section 782(i) of the Act, the administering authority shall, subject 
to section 782(d) of the Act, use facts otherwise available in reaching 
the applicable determination.
    Where the Department determines that a response to a request for 
information does not comply with the request, section 782(d) of the Act 
provides that the Department shall promptly inform the party submitting 
the response of the nature of the deficiency and shall, to the extent 
practicable, provide that party with an opportunity to remedy or 
explain the deficiency. Section 782(d) of the Act additionally states 
that if the party submits further information that is unsatisfactory or 
untimely, the administering authority may, subject to subsection (e), 
disregard all or part of the original and subsequent responses. 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 the applicable 
requirements established by the administering authority if: (1) The 
information is submitted by the deadline established for its 
submission; (2) the information can be verified; (3) the information is 
not so incomplete that it cannot serve as a reliable basis for reaching 
the applicable determination; (4) the interested party has demonstrated 
that it acted to the best of its ability in providing the information 
and meeting the requirements established by the administering authority 
with respect to the information; and (5) the information can be used 
without undue difficulties.
    Section 776(b) of the Act further provides that, if the Department 
finds that an interested party has failed to comply by not acting to 
the best of its ability to comply with a request of information, the 
Department may use an adverse inference in selecting from among the 
facts otherwise available. Section 776(b) of the Act also authorizes 
the Department to use as 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, the Department preliminarily 
determines that, in accordance with sections 776(a)(1), 776(a)(2) and 
776(b) of the Act, the use of AFA is appropriate for the preliminary 
results with respect to the PRC-wide entity, which includes Shenzhen 
Greening and Tianma Freezing.
    Shenzhen Greening and Tianma Freezing were selected as mandatory 
respondents, but neither responded to the initial questionnaire. Thus, 
the information necessary for the Department to conduct its analysis is 
not available in the record. Moreover, the decision by these companies 
to not respond to the initial questionnaire constitutes a refusal to 
provide the

[[Page 80466]]

Department with information necessary to conduct its antidumping 
analysis. See Sections 776(a)(2)(A) and (B) of the Act. As these 
companies have withheld necessary information that has been requested 
by the Department, the Department shall, pursuant to sections 
776(a)(1), (a)(2)(A), and (a)(2)(B) of the Act, use facts otherwise 
available to reach the applicable determination.
    In addition, because Shenzhen Greening and Tianma Freezing did not 
respond to the initial questionnaire and did not request any extension, 
the Department finds that each of these companies has failed to 
cooperate by not acting to the best of its ability to comply with the 
Department's request for information. By withholding the requested 
information, these companies prevented the Department from conducting 
any company-specific analysis or calculating dumping margins for the 
POR. Therefore, pursuant to section 776(b) of the Act, the Department 
preliminarily determines that an inference that is adverse to the 
interests of Shenzhen Greening and Tianma Freezing is warranted.
    Because we have determined Shenzhen Greening and Tianma Freezing to 
be part of the PRC-wide entity, the PRC-wide entity is now under 
review. The Department preliminarily finds that the PRC-wide entity did 
not respond to the Department's request for information and that 
necessary information is not available on the record. Moreover, the 
Department preliminarily finds that the PRC-wide entity significantly 
impeded the proceeding by withholding information and failing to 
respond to the Department's request for information within the 
specified deadlines. Therefore, pursuant to sections 776(a)(1) and 
(a)(2) of the Act, the Department preliminarily determines that the 
application of facts otherwise available is warranted for the PRC-wide 
entity.
    In addition, because Shenzhen Greening and Tianma Freezing failed 
to cooperate by not acting to the best of its ability, the PRC-wide 
entity did not provide the requested information, which was in the sole 
possession of the respondents and could not be obtained otherwise. 
Pursuant to section 776(b) of the Act, we preliminarily determine that 
in selecting from among the facts otherwise available, an adverse 
inference is warranted for the PRC-wide entity. By using an inference 
that is adverse to the interests of the PRC-wide entity, we ensure the 
companies that are part of the PRC-wide entity will not obtain a more 
favorable result by failing to cooperate than had they cooperated fully 
in this review.
    In deciding which facts to use as AFA, section 776(b) of the Act 
and 19 CFR 351.308(c) authorize the Department to rely on information 
derived from: (1) The petition; (2) a final determination in the 
investigation; (3) any previous review or determination; or (4) any 
information placed on the record. In reviews, the Department normally 
selects, as AFA, the highest rate on the record of any segment of the 
proceeding. See, e.g., Freshwater Crawfish Tail Meat from the People's 
Republic of China; Notice of Final Results of Antidumping Duty 
Administrative Review, 68 FR 19504, 19506 (April 21, 2003). The U.S. 
Court of International Trade (CIT) and the CAFC have consistently 
upheld the Department's practice in this regard. See Rhone Poulenc, 
Inc. v. United States, 899 F.2d 1185, 1190 (Fed. Circ. 1990) (Rhone 
Poulenc); NSK Ltd. v. United States, 346 F. Supp. 2d 1312, 1335 (CIT 
2004) (upholding a 73.55 percent total AFA rate, the highest available 
dumping margin from a different respondent in a less-than-fair-value 
investigation); see also Kompass Food Trading Int'l v. United States, 
24 CIT 678, 683-84 (2000) (upholding a 51.16 percent total AFA rate, 
the highest available dumping margin from a different, fully 
cooperative respondent); and Shanghai Taoen International Trading Co., 
Ltd. v. United States, 360 F. Supp. 2d 1339, 1348 (CIT 2005) (upholding 
a 223.01 percent total AFA rate, the highest available dumping margin 
from a different respondent in a previous administrative review).
    The Department's practice when selecting an adverse rate from among 
the possible sources of information is to ensure that the margin is 
``sufficiently adverse so as to effectuate the statutory purposes of 
the adverse facts available rule to induce respondents to provide the 
Department with complete and accurate information in a timely manner.'' 
See Notice of Final Determination of Sales at Less Than Fair Value: 
Static Random Access Memory Semiconductors From Taiwan, 63 FR 8909, 
8932 (February 23, 1998). The Department's practice also ensures ``that 
the party does not obtain a more favorable result by failing to 
cooperate than if it had cooperated fully.'' See Statement of 
Administrative Action Accompanying the Uruguay Round Agreements Act, 
H.R. Rep. No. 103-316, Vol. 1, at 870 (1994) (SAA); see also Notice of 
Final Determination of Sales at Less Than Fair Value: Certain Frozen 
and Canned Warmwater Shrimp From Brazil, 69 FR 76910, 76912 (December 
23, 2004). In choosing the appropriate balance between providing 
respondents with an incentive to respond accurately and imposing a rate 
that is reasonably related to the respondent's prior commercial 
activity, selecting the highest prior margin ``reflects a common sense 
inference that the highest prior margin is the most probative evidence 
of current margins, because, if it were not so, the importer, knowing 
of the rule, would have produced current information showing the margin 
to be less.'' See Rhone Poulenc, 899 F.2d at 1190.
    Consistent with the statute, court precedent, and its normal 
practice, the Department has preliminarily assigned the rate of $4.71 
per kilogram, the highest rate determined in any segment of this 
proceeding, to the PRC-wide entity, which includes the companies named 
in Attachment III. See 13th Administrative Review. As discussed further 
in the ``Corroboration of Secondary Information Used as Adverse Facts 
Available'' section below, this rate has been corroborated.

Corroboration of Secondary Information Used as Adverse Facts Available

    Section 776(c) of the Act provides that, where the Department 
selects from among the facts otherwise available and relies on 
``secondary information,'' the Department shall, to the extent 
practicable, corroborate that information from independent sources 
reasonably at the Department's disposal. Secondary information is 
described in the SAA as ``{i{time} nformation derived from the petition 
that gave rise to the investigation or review, the final determination 
covering the subject merchandise, or any previous review under section 
751 concerning the subject merchandise.'' See SAA at 870. The SAA 
states that ``corroborate'' means to determine that the information 
used has probative value. Id. The Department has determined that to 
have probative value, information must be reliable and relevant. See, 
e.g., Tapered Roller Bearings and Parts Thereof, Finished and 
Unfinished, From Japan, and Tapered Roller Bearings, Four Inches or 
Less in Outside Diameter, and Components Thereof, From Japan; 
Preliminary Results of Antidumping Duty Administrative Reviews and 
Partial Termination of Administrative Reviews, 61 FR 57391, 57392 
(November 6, 1996) (unchanged in Tapered Roller Bearings and Parts 
Thereof, Finished and Unfinished, From Japan, and Tapered Roller 
Bearings, Four Inches or Less in Outside Diameter, and Components 
Thereof, From Japan; Final

[[Page 80467]]

Results of Antidumping Duty Administrative Reviews and Termination in 
Part, 62 FR 11825 (March 13, 1997)). The SAA also states that 
independent sources used to corroborate such evidence may include, for 
example, published price lists, official import statistics and customs 
data, and information obtained from interested parties during the 
particular investigation or review. See SAA at 870; see also Notice of 
Preliminary Determination of Sales at Less Than Fair Value: High and 
Ultra-High Voltage Ceramic Station Post Insulators from Japan, 68 FR 
35627, 35629 (June 16, 2003) (unchanged in Notice of Final 
Determination of Sales at Less Than Fair Value: High and Ultra-High 
Voltage Ceramic Station Post Insulators from Japan, 68 FR 62560 
(November 5, 2003); and Notice of Final Determination of Sales at Less 
Than Fair Value: Live Swine From Canada, 70 FR 12181, 12183 (March 11, 
2005).
    To be considered corroborated, information must be found to be both 
reliable and relevant. Unlike other types of information, such as input 
costs or selling expenses, there are no independent sources for 
calculated dumping margins. The only sourc