Frontseating Service Valves From the People's Republic of China: Preliminary Results of the 2010-2011 Antidumping Duty Administrative Review, 26489-26496 [2012-10839]
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Federal Register / Vol. 77, No. 87 / Friday, May 4, 2012 / Notices
DEPARTMENT OF COMMERCE
International Trade Administration
[A–570–933]
Frontseating Service Valves From the
People’s Republic of China:
Preliminary Results of the 2010–2011
Antidumping Duty Administrative
Review
Import Administration,
International Trade Administration,
Department of Commerce.
SUMMARY: In response to requests from
interested parties, the Department of
Commerce (‘‘the Department’’) is
conducting an administrative review of
the antidumping duty order on
frontseating service valves (‘‘FSVs’’)
from the People’s Republic of China
(‘‘PRC’’), covering the period April 1,
2010 through March 31, 2011.
We have preliminarily determined
that neither respondent in this
administrative review, Zhejiang DunAn
Hetian Metal Co., Ltd. (‘‘DunAn’’) or
Zhejiang Sanhua Co., Ltd. (‘‘Sanhua’’)
made sales in the United States at prices
below normal value (‘‘NV’’) during the
period of review (‘‘POR’’). We invite
interested parties to comment on these
preliminary results. Parties who submit
comments are requested to submit with
each argument a summary of the
argument. 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: May 4, 2012.
FOR FURTHER INFORMATION CONTACT:
Laurel LaCivita, Eugene Degnan, 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) 482–4243, and (202)
482–0414, respectively.
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AGENCY:
Background
On April 28, 2009, the Department
published in the Federal Register the
antidumping duty order on FSVs from
the PRC.1 On April 1, 2011, the
Department published in the Federal
Register a notice of opportunity to
request an administrative review of the
antidumping duty order on FSVs from
the PRC for the period April 1, 2010
through March 31, 2011.2 On April 27,
1 See Antidumping Duty Order: Frontseating
Service Valves from the People’s Republic of China,
74 FR 19196 (April 28, 2009) (‘‘Order’’).
2 See Antidumping or Countervailing Duty Order,
Finding, or Suspended Investigation; Opportunity
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2011, in accordance with 19 CFR
351.213(b)(2), Sanhua, a foreign
exporter of the subject merchandise,
requested the Department to review its
sales of subject merchandise.3 On May
2, 2011, Parker-Hannifin Corporation
(‘‘Petitioner’’) requested that the
Department conduct an administrative
review of the exports of subject
merchandise made by DunAn and
Sanhua during the POR.4 On the same
date, DunAn, a foreign exporter of the
subject merchandise, requested that the
Department review its sales of subject
merchandise.5 On May 27, 2011, the
Department initiated an administrative
review of the order on FSVs from the
PRC for the POR with respect to DunAn
and Sanhua.6
Between June 2011 and April 2012,
the Department issued its initial and
supplemental antidumping duty
questionnaires to DunAn and Sanhua.
DunAn and Sanhua submitted their
responses between September 2011 and
March 2012. Petitioner did not comment
on these questionnaire responses.
On September 2, 2011, the
Department requested that Import
Administration’s Office of Policy
provide a list of surrogate countries for
this review.7 On September 22, 2011,
the Office of Policy issued its list of
surrogate countries.8 On October 11,
2011, the Department issued a letter to
interested parties seeking comments on
surrogate country selection and
surrogate values (‘‘SVs’’).9 On November
To Request Administrative Review, 76 FR 18153,
18154 (April 1, 2011).
3 See Letter from Sanhua, ‘‘Frontseating Service
Valves from the People’s Republic of China; A–570–
933; Request for § 751 Administrative Review of
Exports by Zhejiang Sanhua Co., Ltd.,’’ dated April
27, 2011.
4 See Letter from Petitioners, ‘‘Frontseating
Service Valves from the People’s Republic of
China—Request for Initiation of Antidumping
Administrative Review,’’ dated May 2, 2011.
5 See Letter from DunAn, ‘‘Request for
Administrative Review of the Antidumping Duty
Order of Frontseating Service Valves from the
People’s Republic of China (POR 4/01/2010–3/31/
2011),’’ dated May 2, 2011.
6 See Initiation of Antidumping and
Countervailing Duty Administrative Reviews, 76 FR
30912 (May 27, 2011) (‘‘Initiation Notice’’).
7 See Memorandum to Carole Showers, Director,
Office of Policy, ‘‘Antidumping Duty
Administrative Review of Frontseating Service
Valves from the People’s Republic of China:
Surrogate-Country Selection,’’ dated September 2,
2011.
8 See Memorandum from Carole Showers,
Director, Office of Policy, ‘‘Request for a List of
Surrogate Countries for an Administrative Review
of the Antidumping Duty Order on Frontseating
Service Valves (‘FSVs’) from the People’s Republic
of China (‘China’),’’ dated September 22, 2011
(‘‘Surrogate Country List’’).
9 See Letter to Interested Parties, ‘‘Second
Administrative Review of the Antidumping Duty
Order on Front Seating Valves from the People’s
Republic of China: Request for Comments on the
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1, 2011, Petitioner and DunAn provided
surrogate country selection comments.
On November 28, Petitioner and DunAn
submitted SV comments (‘‘Petitioner’s
SV Comments’’ and ‘‘DunAn’s SV
Comments,’’ respectively). On December
12, 2011, DunAn submitted rebuttal SV
comments (‘‘DunAn’s Rebuttal SV
Comments’’).
On December 13, 2011, the
Department extended the time period
for completion of the preliminary
results of this review by 90 days until
March 30, 2012.10 On March 7, 2012,
the Department extended the time
period for completing the preliminary
results of review by an additional 30
days until April 29, 2012.11 However,
because April 29, 2012, falls on a
weekend, the preliminary results are
now due no later than April 30, 2012.12
Period of Review
The POR is April 1, 2010, through
March 31, 2011.
Scope of the Order
The merchandise covered by this
order is frontseating service valves,
assembled or unassembled, complete or
incomplete, and certain parts thereof.
Frontseating service valves contain a
sealing surface on the front side of the
valve stem that allows the indoor unit
or outdoor unit to be isolated from the
refrigerant stream when the air
conditioning or refrigeration unit is
being serviced. Frontseating service
valves rely on an elastomer seal when
the stem cap is removed for servicing
and the stem cap metal to metal seat to
create this seal to the atmosphere during
normal operation.13
For purposes of the scope, the term
‘‘unassembled’’ frontseating service
valve means a brazed subassembly
Selection of a Surrogate Country and Surrogate
Values,’’ dated October 11, 2011.
10 See Frontseating Service Valves From the
People’s Republic of China: Extension of Time for
the Preliminary Results of the Antidumping Duty
Administrative Review, 76 FR 77479 (December 13,
2011).
11 See Frontseating Service Valves from the
People’s Republic of China: Notice of Second
Extension of Time Limit for the Preliminary Results
of the Antidumping Duty Administrative Review, 77
FR 13539 (March 7, 2012).
12 See id.; see also Notice of Clarification:
Application of ‘‘Next Business Day’’ Rule for
Administrative Determination Deadlines Pursuant
to the Tariff Act of 1930, As Amended, 70 FR 24533
(May 10, 2005).
13 The frontseating service valve differs from a
backseating service valve in that a backseating
service valve has two sealing surfaces on the valve
stem. This difference typically incorporates a valve
stem on a backseating service valve to be machined
of steel, where a frontseating service valve has a
brass stem. The backseating service valve dual stem
seal (on the back side of the stem), creates a metal
to metal seal when the valve is in the open position,
thus, sealing the stem from the atmosphere.
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requiring any one or more of the
following processes: the insertion of a
valve core pin, the insertion of a valve
stem and/or O ring, the application or
installation of a stem cap, charge port
cap or tube dust cap. The term
‘‘complete’’ frontseating service valve
means a product sold ready for
installation into an air conditioning or
refrigeration unit. The term
‘‘incomplete’’ frontseating service valve
means a product that when sold is in
multiple pieces, sections, subassemblies
or components and is incapable of being
installed into an air conditioning or
refrigeration unit as a single, unified
valve without further assembly.
The major parts or components of
frontseating service valves intended to
be covered by the scope under the term
‘‘certain parts thereof’’ are any brazed
subassembly consisting of any two or
more of the following components: a
valve body, field connection tube,
factory connection tube or valve charge
port. The valve body is a rectangular
block, or brass forging, machined to be
hollow in the interior, with a generally
square shaped seat (bottom of body).
The field connection tube and factory
connection tube consist of copper or
other metallic tubing, cut to length,
shaped and brazed to the valve body in
order to create two ports, the factory
connection tube and the field
connection tube, each on opposite sides
of the valve assembly body. The valve
charge port is a service port via which
a hose connection can be used to charge
or evacuate the refrigerant medium or to
monitor the system pressure for
diagnostic purposes.
The scope includes frontseating
service valves of any size, configuration,
material composition or connection
type. Frontseating service valves are
classified under subheading
8481.80.1095, and also have been
classified under subheading
8415.90.80.85, of the Harmonized Tariff
Schedule of the United States
(‘‘HTSUS’’). It is possible for
frontseating service valves to be
manufactured out of primary materials
other than copper and brass, in which
case they would be classified under
HTSUS subheadings 8481.80.3040,
8481.80.3090, or 8481.80.5090. In
addition, if unassembled or incomplete
frontseating service valves are imported,
the various parts or components would
be classified under HTSUS subheadings
8481.90.1000, 8481.90.3000, or
8481.90.5000. The HTSUS subheadings
are provided for convenience and
customs purposes, but the written
description of the scope of this
proceeding is dispositive.
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Non-Market Economy Country Status
No interested party contested the
Department’s treatment of the PRC as a
non-market economy (‘‘NME’’) country
in this administrative review, and the
Department has treated the PRC as an
NME country in all past antidumping
duty investigations and administrative
reviews.14 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 a NME in
this proceeding.
Surrogate Country
When the Department is investigating
imports from an NME country, section
773(c)(1) of the Act directs it to base NV,
in most circumstances, on the NME
producer’s factors of production
(‘‘FOP’’), 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 utilize, to
the extent possible, the prices or costs
of 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.15 The sources of the
surrogate factor values are discussed
under the ‘‘Factor Valuations’’ section
below and in the Factor Valuation
Memorandum,16 which is on file in the
Central Records Unit, Room 7046 of the
main Department building.
In examining which country to select
as its primary surrogate country for this
proceeding, the Department first
determined that Colombia, Indonesia,
the Philippines, South Africa, Thailand,
and Ukraine are countries comparable to
the PRC in terms of economic
development.17 Once the Department
has identified countries that are
economically comparable to the PRC, it
identifies those countries which are
14 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).
15 See Import Administration Policy Bulletin
04.1: Non-Market Economy Surrogate Country
Selection Process (March 1, 2004) (‘‘Policy
Bulletin’’).
16 See Memorandum to the File, ‘‘2010–2011
Administrative Review of the Antidumping Duty
Order on Frontseating Service Valves from the
People’s Republic of China: Factor Valuation
Memorandum for the Preliminary Results of
Review,’’ dated April 30, 2012 (‘‘Factor Valuation
Memorandum’’).
17 See Surrogate Country List.
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significant producers of comparable
merchandise.
Petitioner submitted a letter stating
that Thailand is an appropriate
surrogate country because: (1) Thailand
is at a level of economic development
comparable to the PRC; (2) of the six
countries at a level of economic
development to the PRC, Thailand is the
most significant producer of comparable
merchandise; (3) the World Trade Atlas
(‘‘WTA’’) has import values for direct
materials, energy and packaging inputs
used to manufacture the merchandise
under consideration; and, (4) the
Department recently used Thailand as
the surrogate country in the preliminary
determination of the antidumping duty
investigation of galvanized steel wire
from the PRC.18
DunAn submitted a letter stating that
the Philippines is an appropriate
surrogate country because: (1) The
Philippines is at a level of economic
development comparable to the PRC; (2)
the Philippines is a significant producer
of comparable merchandise; (3) the
Philippines offers the most specific,
comprehensive and reliable surrogate
value data of all the potential surrogate
countries.19
After evaluating interested parties’
comments, the Department has
determined that the Philippines is the
appropriate surrogate country to use in
this review in accordance with section
773(c)(4) of the Act. The Department
based its decision on the following facts:
(1) The Philippines is at a level of
economic development comparable to
that of the PRC; 20 (2) the Philippines, in
terms of total value of net exports, is a
significant producer of comparable
merchandise; 21 and, as explained
below, (3) the Philippines provides the
best opportunity to use quality, publicly
available data to value the FOPs,
including surrogate financial data.
Therefore, because the Philippines
best represents the experience of
producers of comparable merchandise
operating in a surrogate country, we
have selected the Philippines as the
surrogate country and, accordingly,
18 See Letter from Petitioner, ‘‘Petitioner’s
Comments on Surrogate Country Selection in the
Second Administrative Review of Certain
Frontseating Service Valves from the People’s
Republic of China,’’ dated November 1, 2011
(‘‘Petitioner’s Surrogate Country Selection Letter’’)
at 1–2.
19 See Letter from DunAn, ‘‘Surrogate Country
Comments in the Antidumping Duty Investigation
on Frontseating Service Valves from the People’s
Republic of China,’’ dated November 1, 2011
(‘‘DunAn’s Surrogate Country Selection Letter’’) at
1–2.
20 See Surrogate Country List.
21 See DunAn’s Surrogate Country Selection
Letter at 2–3 and Exhibit 1.
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have calculated NV using Philippine
prices to value DunAn’s and Sanhua’s
FOPs, when available and appropriate.
We have obtained and relied upon
publicly available information to value
all FOPs.
In accordance with 19 CFR
351.301(c)(3)(ii), interested parties may
submit publicly available information to
value the FOPs within 20 days after the
date of publication of the preliminary
results of review.22
(May 6, 1991) (‘‘Sparklers’’), as further
developed in Notice of Final
Determination of Sales at Less Than
Fair Value: Silicon Carbide From the
People’s Republic of China, 59 FR 22585
(May 2, 1994) (‘‘Silicon Carbide’’).
However, if the Department determines
that a company is wholly foreign-owned
or located in a market economy, then a
separate rate analysis is not necessary to
determine whether it is independent
from government control.26
Separate Rates
A designation of a country as an NME
remains in effect until it is revoked by
the Department.23 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.24
In the Initiation Notice, the
Department notified parties of the
application and certification process by
which exporters may obtain separate
rate status in NME proceedings.25 It is
the Department’s policy to assign all
exporters of subject merchandise in an
NME country a single rate unless an
exporter can demonstrate that it is
sufficiently independent so as to be
entitled to a separate rate. Exporters can
demonstrate this independence through
the absence of both de jure and de facto
governmental control over export
activities. The Department analyzes
each entity exporting the subject
merchandise under a test arising from
the Final Determination of Sales at Less
Than Fair Value: Sparklers From the
People’s Republic of China, 56 FR 20588
Separate Rate Recipients
DunAn and Sanhua each reported that
it is a wholly Chinese-owned
company.27 Therefore, the Department
must analyze whether these respondents
can demonstrate the absence of both de
jure and de facto governmental control
over export activities.
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22 In
accordance with 19 CFR 351.301(c)(1), for
the final determination of this review, interested
parties may submit factual information to rebut,
clarify, or correct factual information submitted by
an interested party less than ten days before, on, or
after the applicable deadline for submission of such
factual information. However, the Department notes
that 19 CFR 351.301(c)(1) permits new information
only insofar as it rebuts, clarifies, or corrects
information recently placed on the record. The
Department generally cannot accept the submission
of additional, previously absent-from-the-record
alternative SV information pursuant to 19 CFR
351.301(c)(1). See Glycine from the People’s
Republic of China: Final Results of Antidumping
Duty Administrative Review and Final Rescission,
in Part, 72 FR 58809 (October 17, 2007), and
accompanying Issues and Decision Memorandum at
Comment 2.
23 See section 771(18)(C)(i) of the Act.
24 See Notice of Final Determination of Sales at
Less Than Fair Value, and Affirmative Critical
Circumstances, In Part: Certain Lined Paper
Products From the People’s Republic of China, 71
FR 53079 (September 8, 2006) (‘‘Lined Paper from
the PRC’’); see also Final Determination of Sales at
Less Than Fair Value and Final Partial Affirmative
Determination of Critical Circumstances: Diamond
Sawblades and Parts Thereof From the People’s
Republic of China, 71 FR 29303 (May 22, 2006).
25 See Initiation Notice, 76 FR 30913.
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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 DunAn and
Sanhua supports a preliminary finding
of de jure absence of governmental
control based on the following: (1) An
absence of restrictive stipulations
associated with their businesses and
export licenses; (2) applicable legislative
enactments decentralizing control of
companies; and (3) formal measures by
the government decentralizing control
of companies.29
b. Absence of De Facto Control
Typically, the Department considers
four factors in evaluating whether each
respondent is subject to de facto
government control of its export
functions: (1) Whether the export prices
are set by or are subject to the approval
of a government 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
26 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).
27 See DunAn’s Section A Questionnaire
Response, dated July 11, 2010 (‘‘DunAn’s AQR’’) at
2–19; Sanhua’s Section A Questionnaire Response,
dated July 11, 2011 (‘‘Sanhua’s AQR’’) at 2.
28 See Sparklers, 56 FR 20589.
29 See Foreign Trade Law of the People’s Republic
of China, contained in Sanhua’s AQR, at Exhibit A–
2. See also DunAn’s AQR at 3–4.
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26491
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 provided by DunAn and
Sanhua supports a preliminary finding
of de facto absence of government
control based on the following: (1) The
absence of evidence that the export
prices are set by or are subject to the
approval of a government agency; 31 (2)
the respondents have authority to
negotiate and sign contracts and other
agreements; 32 (3) the respondents have
autonomy from the government in
making decisions regarding the
selection of management; 33 and (4) the
respondents retain the proceeds of their
export sales and make independent
decisions regarding disposition of
profits or financing of losses.34
Therefore, the evidence placed on the
record of this review by DunAn and
Sanhua demonstrates an absence of de
jure and de facto government control
with respect to DunAn’s and Sanhua’s
exports of the merchandise under
review, in accordance with the criteria
identified in Sparklers and Silicon
Carbide. Accordingly, we have
determined that DunAn and Sanhua
have demonstrated their eligibility for a
separate rate.
Fair Value Comparisons
To determine whether sales of FSVs
to the United States by DunAn and
Sanhua were made at less than NV, the
Department compared constructed
export price (‘‘CEP’’) to NV, as described
in the ‘‘Constructed Export Price’’ and
‘‘Normal Value’’ sections of this notice.
In these preliminary results, the
Department applied the weightedaverage dumping margin calculation
method adopted in Antidumping
Proceedings: Calculation of the
Weighted-Average Dumping Margin and
30 See Silicon Carbide, 59 FR 22587; 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 DunAn’s AQR, at 8–9 and Sanhua’s AQR
at 7–8 and Exhibit A–5.
32 See DunAn’s AQR, at 8–9 and Sanhua’s AQR
at 8–9.
33 See DunAn’s AQR, at 10–11 and Sanhua’s AQR
at 9–10.
34 See DunAn’s AQR, at 11–12 and Sanhua’s AQR
at 10–12.
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Assessment Rate in Certain
Antidumping Proceedings: Final
Modification.35 In particular, the
Department compared monthly
weighted-average export prices (or
constructed export prices) with monthly
weighted-average normal values and
granted offsets for non-dumped
comparisons in the calculation of the
weighted average dumping margin.
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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
DunAn’s and Sanhua’s sales because the
sales were made by U.S. affiliates in the
United States.
We calculated CEP based on delivered
prices to unaffiliated purchasers in the
United States. We made adjustments,
where applicable, to the reported gross
unit prices for billing adjustments to
arrive at the price at which the subject
merchandise is first sold in the United
States to an unaffiliated customer. We
made deductions from the U.S. sales
price for movement expenses in
accordance with section 772(c)(2) of the
Act. These included, where applicable,
foreign inland freight from plant to the
port of exportation, foreign brokerage
and handling, ocean freight, marine
insurance, U.S. inland freight from port
to the warehouse, U.S. freight from
warehouse to customer, U.S.
warehousing, U.S. customs duty, and
U.S. brokerage and handling. In
accordance with section 772(d)(1) of the
Act, the Department deducted, where
applicable, commissions, credit
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
accordance with section 772(d) of the
Act, we calculated DunAn’s and
Sanhua’s credit expenses and inventory
carrying costs based on each company’s
respective short-term interest rate. In
addition, we deducted CEP profit in
35 See Antidumping Proceedings: Calculation of
the Weighted-Average Dumping Margin and
Assessment Rate in Certain Antidumping
Proceedings: Final Modification, 77 FR 8101
(February 14, 2012) (‘‘Final Modification for
Reviews’’).
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accordance with sections 772(d)(3) and
772(f) of the Act.36
Normal Value
Section 773(c)(1) of the Act provides
that the Department shall determine NV
using a factors of production
methodology if the merchandise is
exported from an NME country and the
Department finds that the available
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. When determining NV in an
NME context, the Department will base
NV on FOPs because the presence of
government controls on various aspects
of these economies renders price
comparisons and the calculation of
production costs invalid under our
normal methodologies. The
Department’s questionnaire requires
that DunAn and Sanhua each provide
information regarding the weightedaverage FOPs across all of the
company’s plants and/or suppliers that
produce the merchandise under
consideration, not just the FOPs from a
single plant or supplier. This
methodology ensures that the
Department’s calculations are as
accurate as possible.37
In accordance with 19 CFR
351.408(c)(1), the Department will
normally use publicly available
information to find an appropriate SV to
value FOPs, but when a producer
sources an input from a ME and pays for
it in ME currency, the Department may
value the factor using the actual price
paid for the input.38 DunAn and Sanhua
each reported that they did not purchase
inputs from ME suppliers for the
production of the merchandise under
consideration.39
36 For a detailed description of all adjustments,
see Memoranda titled ‘‘Frontseating Service Valves
from the People’s Republic of China: Analysis
Memorandum for the Preliminary Results of the
2010–2011 Administrative Review: Zhejiang
DunAn Hetian Metal Co. Ltd.,’’ (‘‘DunAn
Preliminary Analysis Memorandum’’), dated April
30, 2012; and, ‘‘Frontseating Service Valves
(‘‘FSVs’’) from the People’s Republic of China
(‘‘PRC’’): Analysis Memorandum for the
Preliminary Results of the 2010–2011
Administrative Review: Zhejiang Sanhua Co., Ltd.
(‘‘Sanhua’’),’’ (‘‘Sanhua Preliminary Analysis
Memorandum’’), dated April 30, 2012.
37 See, e.g., Final Determination of Sales at Less
Than Fair Value and Critical Circumstances:
Certain Malleable Iron Pipe Fittings From the
People’s Republic of China, 68 FR 61395 (October
28, 2003), and accompanying Issue and Decision
Memorandum at Comment 19.
38 See 19 CFR 351.408(c)(1); see also Shakeproof
Assembly Components, Div. of Ill. Tool Works, Inc.
v. United States, 268 F.3d 1376, 1382–1383 (Fed.
Cir. 2001) (affirming the Department’s use of
market-based prices to value certain FOPs).
39 See DunAn’s Section D Questionnaire response
(‘‘DunAn’s DQR’’) at 6, and Sanhua’s Section D
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We calculated NV based on FOPs in
accordance with section 773(c)(3) and
(4) of the Act and 19 CFR 351.408(c).
The FOPs include but are not limited to:
(1) Hours of labor required; (2)
quantities of raw materials employed;
(3) amounts of energy and other utilities
consumed; and (4) representative capital
costs. The Department used FOPs
reported by DunAn and Sanhua for
direct materials, energy, labor, byproducts, and packing materials.
DunAn used unaffiliated tollers for
the production of recycled brass bar,
copper tubing, brass valve caps and
valve stems.40 DunAn reported the FOPs
of the unaffiliated tollers of brass bar,
except for two tollers that would not
provide full information.41 We
requested DunAn to report the FOPs of
the unaffiliated tollers of the other
components.42 DunAn reported that it
attempted to obtain FOP’s from all of its
unaffiliated tollers of copper tubing,
brass valve caps and valve stems, but
that the tollers were unable or unwilling
to cooperate with the Department’s
request for information. DunAn
documented these attempts for the
record.43 Consequently, we do not find
that DunAn failed to cooperate by not
acting in the best of its abilities.
Consistent with our treatment of
missing tolled FOPs of an intermediate
input in the first administrative review
of certain steel nails,44 we have
preliminarily applied facts available
(‘‘FA’’) in accordance with section
Questionnaire response, dated August 3, 2011
(‘‘Sanhua’s DQR’’) at 7.
40 See DunAn’s letter, ‘‘DunAn Questionnaire
Response to Question 16 of the Third Supplemental
Questionnaire in the Second Administrative Review
of the Antidumping Duty Order on Frontseating
Service Valves from the people’s Republic of
China,’’ dated February 21, 2012 (‘‘3rd SQR
(Question 16)’’), at 2.
41 See DunAn’s DQR at Exhibit D–19; and
DunAn’s letter, ‘‘DunAn Third Supplemental
Questionnaire Response in the Second
Administrative Review of the Antidumping Duty
Order on Frontseating Service Valves from the
people’s Republic of China,’’ dated February 27,
2012 (‘‘3rd SQR’’).
42 See letter from the Department, ‘‘Front Seating
Service Values from the People’s Republic of China:
Zhejiang DunAn Hetian Metal Co., Ltd. (‘‘DunAn’’):
Fourth Supplemental Questionnaire,’’ dated March
1, 2012.
43 See letter from DunAn, ‘‘Fourth Supplemental
Questionnaire Response in the Second
Administrative Review of the Antidumping Duty
Order on Frontseating Service Valves from the
People’s Republic of China,’’ dated March 22, 2012
(‘‘4th SQR’’), at 1–2, and Exhibit 1, with respect to
the tollers of copper tubing, brass valve caps and
valve stems. With respect to brass bar, see DunAn’s
3rd SQR (Question 16) at 8.
44 See Certain Steel Nails from the People’s
Republic of China: Final Results of the First
Antidumping Duty Administrative Review, 76 FR
16379 (March 23, 2011) and accompanying Issues
and Decision Memorandum at Comment 17.
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776(a)(1) of the Act.45 The Department
is using DunAn’s reported consumption
of the intermediate inputs received from
the tollers as FA (facts available without
an adverse inference) for DunAn.
DunAn reported that it produced
model SFJH–308–DG8 (‘‘DG8’’) in its
entirety prior to the POR,46 and that it
produced the valve bodies for models
SFJI–314–DG16 (‘‘DG16’’) and SFJI–
314–DG20 (‘‘DG20’’) prior to the POR,
but completed certain components
(brass valve caps and valve stems),47
final assembly, and packing during the
current POR.48 Consequently, DunAn
explained that it reported per-unit FOPs
in the section D database based on its
production experience at the time when
the models were produced.49 Thus,
DunAn explained that the FOPs for
model DG8 were based entirely on
consumption rates during the previous
administrative review.50 However, for
models DG16 and DG20, DunAn
explained that it based the FOPs for the
valve bodies, brass scrap, and most raw
material inputs on the consumption
rates of the prior POR,51 but that it
based FOPs for brass valve caps and
stems,52 assembly, and packing on the
consumption rates for the current
POR.53
After a careful examination of its
questionnaire and supplemental
responses, we have determined that
DunAn’s reporting methodology may
not be appropriate for the purposes of
this antidumping duty review. Because
models DG16 and DG20 were completed
(e.g., entered into finished goods
inventory) during the current POR, we
consider these models to have been
produced during the current POR.54
Therefore, we have requested DunAn to
revise its questionnaire response to
report all factors of production
(including factors for all material and
packing inputs, components (tolled or
produced in-house), tolled round brass
bar, brass scrap, labor, energy, water,
ammonia and acid wash) for models
45 See
the ‘‘Facts Available’’ section of this notice.
DunAn’s DQR at 2.
47 See DunAn’s 3rd SQR (Question 16) at 2.
48 See DunAn’s DQR at 2.
49 See DunAn’s DQR at 2 and DunAn’s 3rd SQR
(Question 16) at 1–2.
50 See DunAn’s DQR at 2.
51 See DunAn’s DQR at 2 and 15.
52 See DunAn’s 3rd SQR (Question 16) at 2.
53 See DunAn’s DQR at 2.
54 See section 751(a)(2) of the Act (directing the
Department in an administrative review to
determine the normal value of each entry of subject
merchandise); section 773(c)(1) of the Act (requiring
the Department to determine normal value based
upon ‘‘the factors of production utilized in
producing the merchandise’’) (emphasis added).
DG16 and DG20 based on its production
experience during the current POR.55
Because this response is not due until
after the preliminary results, we have
used DunAn’s reported FOPs as FA in
accordance with section 776(a)(1) of the
Act, for the purposes of these
preliminary results.56 However, for the
final results of review, we will make our
determination based on DunAn’s full set
of questionnaire responses, including its
response to the Department’s 5th
Supplemental Questionnaire, as
appropriate.
DunAn and Sanhua separately
reported that they each generate brass
scrap during the production process of
merchandise under consideration and
requested an offset for this scrap.57 In
addition, Sanhua reported that it also
generates copper scrap in the
production of merchandise under
consideration, and requested an
additional offset for this scrap.58 Sanhua
established that it sold all of the brass
and copper scrap that it produced
during the POR. Therefore, for these
preliminary results, we have granted
Sanhua a by-product offset for brass and
copper scrap because it demonstrated
that there is commercial value to this
scrap.59 DunAn also established
commercial value for its scrap by
demonstrating that it sold a portion of
the scrap that it produced during the
POR, and provided the remaining scrap
to unaffiliated processors for production
into recycled bar. Accordingly, we have
granted DunAn a by-product offset for
its brass scrap generated during
production during the POR.60
Factor Valuations
In accordance with section 773(c) of
the Act, the Department calculated NV
based on FOPs reported by DunAn and
Sanhua for the POR. To calculate NV,
the Department multiplied the reported
per-unit factor consumption quantities
by publicly available Philippine SVs. In
selecting the SVs, the Department
considered the quality, specificity, and
contemporaneity of the data. The
Department adjusted input prices by
including freight costs to make them
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46 See
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55 See the Department’s letter to DunAn, ‘‘Front
Seating Service Values from the People’s Republic
of China: Zhejiang DunAn Hetian Metal Co., Ltd.
(‘‘DunAn’’): Fifth Supplemental Questionnaire,’’
dated April 10, 2012 (‘‘5th Supplemental
Questionnaire’’).
56 See the ‘‘Facts Available’’ section of this notice.
57 See DunAn’s DQR at D–8 and Exhibits D–5, D–
15 through 18 and Sanhua’s DQR at 17–19 and
Exhibit D–10a.
58 See id.
59 See Sanhua’s Preliminary Analysis
Memorandum.
60 See DunAn’s Preliminary Analysis
Memorandum.
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26493
delivered prices, as appropriate.
Specifically, the Department added to
Philippine import surrogate values a
Philippine 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. This adjustment is in
accordance with the decision of the U.S.
Court of Appeals for the Federal Circuit
in Sigma Corp. v. United States, 117
F.3d 1401, 1407–08 (Fed. Cir. 1997). A
detailed description of all SVs used to
value DunAn’s and Sanhua’s reported
FOPs may be found in the Factor
Valuation Memorandum.
For the preliminary results, in
accordance with the Department’s
practice, except where noted below, we
used data from the Philippine import
statistics in the Global Trade Atlas
(‘‘GTA’’) and other publicly available
Philippine sources in order to calculate
SVs for DunAn and Sanhua’s FOPs (i.e.,
direct materials, energy, and packing
materials) and certain movement
expenses. In selecting the best available
information for valuing FOPs in
accordance with section 773(c)(1) of the
Act, the Department’s practice is to
select, to the extent practicable, SVs
which are non-export average values,
most contemporaneous with the POR,
product-specific, and tax-exclusive.61
The record shows that data in the
Philippine import statistics, as well as
those from the other Philippine sources,
are contemporaneous with the POR,
product-specific, and tax-exclusive.62 In
those instances where we could not
obtain publicly available information
contemporaneous to the POR with
which to value factors, we adjusted the
SVs using, where appropriate, the
Philippine Producer Price Index (‘‘PPI’’)
inflators as published in the
International Monetary Fund’s
International Financial Statistics.63
61 See, e.g., Notice of Preliminary Determination
of Sales at Less Than Fair Value, Negative
Preliminary Determination of Critical
Circumstances and Postponement of Final
Determination: Certain Frozen and Canned
Warmwater Shrimp From the Socialist Republic of
Vietnam, 69 FR 42672, 42682 (July 16, 2004),
unchanged in Final Determination of Sales at Less
Than Fair Value: Certain Frozen and Canned
Warmwater Shrimp from the Socialist Republic of
Vietnam, 69 FR 71005 (December 8, 2004).
62 See Factor Valuation Memorandum.
63 See Factor Valuation Memorandum. See also,
e.g., Certain Kitchen Appliance Shelving and Racks
From the People’s Republic of China: Preliminary
Determination of Sales at Less Than Fair Value and
Postponement of Final Determination, 74 FR 9591,
9600 (March 5, 2009) (‘‘Kitchen Racks Prelim’’),
unchanged in Certain Kitchen Appliance Shelving
and Racks From the People’s Republic of China:
Final Determination of Sales at Less than Fair
Value, 74 FR 36656 (July 24, 2009) (‘‘Kitchen Racks
Final’’).
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However, with respect to four inputs,
arsenic alloy, crystal silicon,
phosphorus, and silicon, there was no
reasonably contemporaneous import
data into the Philippines was available.
As a result, we valued these inputs
using import data into Indonesia as
recorded in the GTA. In accordance
with section 773(c)(4) of the Act, the
Department has determined that
Indonesia is at a level of economic
development comparable to the PRC
and is a significant producer of
merchandise comparable to the subject
merchandise.64 In addition, in
accordance with our practice,65 the GTA
import data with respect to Indonesia
represents non-export average values
and is contemporaneous with the POR,
product-specific, and tax-exclusive.
Furthermore, with regard to
Philippine and Indonesian import-based
SVs, we have disregarded prices that we
have reason to believe or suspect may be
subsidized, such as those from
Indonesia, South Korea, India, and
Thailand. We have found in other
proceedings that these countries
maintain broadly available, nonindustry-specific export subsidies and,
therefore, it is reasonable to infer that all
exports to all markets from these
countries may be subsidized.66 We are
also guided by the statute’s legislative
history that explains that it is not
necessary to conduct a formal
investigation to ensure that such prices
are not subsidized.67 Rather, the
Department was instructed by Congress
to base its decision on information that
is available to it at the time it is making
its determination. In accordance with
the foregoing, we have not used prices
from these countries in calculating the
Philippine import-based SVs.
64 See Surrogate Country List; see also Petitioner’s
Surrogate Country Selection Letter at 2, showing
that Indonesia had exports of 23 million USD of
comparable merchandise during the POR.
65 See, e.g., Notice of Preliminary Determination
of Sales at Less Than Fair Value, Negative
Preliminary Determination of Critical
Circumstances and Postponement of Final
Determination: Certain Frozen and Canned
Warmwater Shrimp From the Socialist Republic of
Vietnam, 69 FR 42672, 42682 (July 16, 2004),
unchanged in Final Determination of Sales at Less
Than Fair Value: Certain Frozen and Canned
Warmwater Shrimp from the Socialist Republic of
Vietnam, 69 FR 71005 (December 8, 2004).
66 See Certain Frozen Fish Fillets from the
Socialist Republic of Vietnam: Preliminary Results
and Preliminary Partial Rescission of Antidumping
Duty Administrative Review, 70 FR 54007, 54011
(September 13, 2005), unchanged in Certain Frozen
Fish Fillets From the Socialist Republic of Vietnam:
Final Results of the First Administrative Review, 71
FR 14170 (March 21, 2006); and China Nat’l Mach.
Import & Export Corp. v. United States, 293 F.
Supp. 2d 1334 (CIT 2003), affirmed 104 Fed. Appx.
183 (Fed. Cir. 2004).
67 See H.R. Rep. No. 100–576 at 590 (1988).
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In these preliminary results, the
Department calculated the labor input
using data on industry-specific labor
cost from the primary surrogate country
(i.e., the Philippines), as described in
Labor Methodologies. The Department
relied on the ILO’s Yearbook Chapter 6A
labor cost data for the Philippines for
the year 2008, because this is the most
recent Chapter 6A data available for the
Philippines. The Department further
determined that the two-digit
description under ISIC–Revision 3–D
(‘‘28–Manufacture of Fabricated Metal
Products’’) is the best available
information because it is specific to the
industry being examined and, therefore,
is derived from industries that produce
comparable merchandise. Accordingly,
relying on Chapter 6A of the Yearbook,
the Department calculated the labor
input using labor cost data reported by
the Philippines to the ILO under SubClassification 28 of the ISIC–Revision 3–
D, in accordance with section 773(c)(4)
of the Act. For further information on
the calculation of the wage rate, see
Factor Valuation Memorandum.
The ILO data from Chapter 6A of the
Yearbook, which was used to value
labor, reflects all costs related to labor,
including wages, benefits, housing,
training, etc. Pursuant to Labor
Methodologies, the Department’s
practice is to consider whether financial
ratios reflect labor expenses that are
included in other elements of the
respondent’s factors of production (e.g.,
general and administrative expenses).68
The financial statements used to
calculate financial ratios in this review
were sufficiently detailed to allow the
Department to isolate labor expenses
from other expenses such as selling,
general and administrative expenses.
Therefore, the Department revised its
calculation of surrogate financial ratios
consistent with Labor Methodologies to
exclude items incorporated in the labor
wage rate data in Chapter 6A of the ILO
data. As a result, bonuses and other
forms of compensation included in the
ILO’s calculation of wages are now
excluded from our calculation of labor
in our surrogate financial ratios.69
We valued electricity, diesel and
kerosene using contemporaneous
Philippine data from The Cost of Doing
Business in Camarines Sur available at
the Philippine government’s Web site
for the province: http://
www.camarinessur.gov.ph. These data
pertained only to industrial
consumption.70
68 See
id. at 36094.
Factor Valuation Memorandum.
70 See id.
69 See
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We valued natural gas using data
obtained from EnergyBiz Magazine’s
January/February 2006 edition, in
which the American Chemistry
Council’s data for Indonesian natural
gas prices of January 2006 are cited. We
inflated this rate to be contemporaneous
with the POR by applying PPI
inflators.71
We valued water using an average of
the basic rates charged by The
Philippines Maynilad for Business
Group II (mostly industrial) users. These
rates were in effect in 2011 and do not
include taxes or surcharges. We did not
inflate the rate since all data points are
contemporaneous with the POR.72
We valued truck freight expenses by
averaging the rates charged by the
Confederation of Truckers Association
of the Philippines, Inc. and the
distances to 92 destinations within the
Philippines. We adjusted the rates
downward by 20 percent to account for
price increases effective January 2011.
The adjusted rates reflect prices in effect
in 2010.73
We valued brokerage and handling
expenses using a price list of export
procedures necessary to export a
standardized cargo of goods in the
Philippines, as published in the World
Bank’s Doing Business 2012, Economy
Profile: Philippines publication.74
We valued marine insurance using a
price quote for July 2010, which we
obtained from RJG Consultants. RJG
Consultants is a market-economy
provider of marine insurance. We did
not inflate this rate since it is
contemporaneous with the POR.75
19 CFR 351.408(c)(4) directs the
Department to value overhead, general,
and administrative expenses (‘‘SG&A’’)
and profit using non-proprietary
information gathered from producers of
identical or comparable merchandise in
the surrogate country. In this
administrative review, Petitioner
submitted the 2010 financial statements
of Halcyon Technology Public Company
Limited (‘‘Halcyon Technology’’), a Thai
corporation engaged in manufacturing,
customized production, and distribution
of polycrystalline diamond (‘‘PCD’’)
cutting tools to serve the manufacturers
of electronic parts and the auto parts
industries, and Patkol Public Company
71 See id.; see also Certain Steel Wheels From the
People’s Republic of China: Notice of Preliminary
Determination of Sales at Less Than Fair Value,
Partial Affirmative Preliminary Determination of
Critical Circumstances, and Postponement of Final
Determination, 76 FR 67703, 67713 (November 2,
2011).
72 See Factor Valuation Memorandum.
73 See id.
74 See id.
75 See id.
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Limited (‘‘Patkol’’), a Thai producer of
machinery and equipment, and a
supplier of engineering services in the
ice making, commercial cool-store, and
freezing industries; a producer of dairy,
tuna, shrimp, and alcoholic beverage
processing equipment; and a supplier of
services for the on-site fabrication,
transportation, and installation of tanks
and/or plant and tank relocation.76
Patkol is also a supplier of sanitary
stainless steel machinery and
equipment, including high velocity
stainless steel pumps, pipes, tees,
bends, valves, and fittings, which are
imported from Europe and the United
States. It is also a supplier of spare parts
for evaporative condensers, axial fans,
Luang Chi cooling towers, tube ice
machines and block ice plants,
equipment for refrigeration systems,
refrigeration spare parts, and ammonia
gas detectors, as well as a reseller of
refrigeration pumps and spare parts
from Germany.
DunAn provided the 2010 audited
financial statements of Concord Metals,
Inc. (‘‘Concord Metals’’), a Philippine
producer of brass, and cast iron and
galvanized iron fittings, and FVC
Philippines, Inc. (‘‘FVC Philippines’’), a
producer of cast iron valves serving the
petroleum and chemical industry, the
machinery and shipbuilding industries,
the paper manufacturing and spinning
industries, the electric power industry,
and the gas and water service
industry.77
We did not use Halcyon Technology’s
and Patkol’s financial statements
because there is no indication that
either of these two companies produced
merchandise that is identical or
comparable to the subject merchandise
and they are not located in our primary
surrogate country. We did not use
Concord Metals’ because the financial
statements indicated that all of its
merchandise consists of purchased
goods,78 and its Web site indicates that
its products may have been produced in
the PRC.79
As a result, we have preliminarily
determined to use the contemporaneous
2010 audited financial statements of
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76 See
letter from Petitioner, ‘‘Petitioner’s PrePreliminary Results Surrogate Value Submission in
the Second Administrative Review of Certain
Frontseating Service Valves from the People’s
Republic of China: Case No. A–570–933,’’ dated
November 28, 2011, at Attachment 2.
77 See letter from DunAn, ‘‘First Surrogate Value
Submission for DunAn in the Antidumping Duty
Investigation on Frontseating Service Valves from
the People’s Republic of China, dated November 28,
2011, (‘‘DunAn’s 1st SV Submission’’) at Exhibit 9A
(for Concord Metals) and 9B (for FVC Philippines).
78 See DunAn’s 1st SV Submission at Exhibit 9A,
Notes to the Financial Statements, at note 7.
79 See Factor Valuation Memorandum.
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FVC Philippines as the basis for
calculating the surrogate financial ratios
in this review. FVC Philippines
produces valves and earned a profit
during the POR. There is no record
evidence to indicate that it received
benefits that the Department has a basis
to believe or suspect to be
countervailable. Further, its audited
financial statements are complete and
sufficiently detailed to disaggregate
materials, labor, overhead, and SG&A
expenses. For a complete listing of all
the inputs and a detailed discussion
about our SV selections, see Factor
Valuation Memorandum.
Facts Available
Section 776(a)(2) of the Act provides
that, if an interested party: (A)
Withholds information that has been
requested by the Department; (B) fails to
provide such information in a timely
manner or in the form or manner
requested subject to sections 782(c)(1)
and (e) of the Act; (C) significantly
impedes a proceeding under the
antidumping statute; or (D) provides
such information but the information
cannot be verified, the Department
shall, subject to section 782(d) of the
Act, use facts otherwise available in
reaching the applicable determination.
Furthermore, section 776(b) of the Act
states that if the Department ‘‘finds that
an interested party has failed to
cooperate by not acting to the best of its
ability to comply with a request for
information from the administering
authority or the Commission, the
administering authority or the
Commission * * *, in reaching the
applicable determination under this
title, may use an inference that is
adverse to the interests of that party in
selecting from among the facts
otherwise available.’’ 80
In this instance, because DunAn was
unable to obtain the FOPs of unaffiliated
tollers for the production of the
intermediate inputs of copper tubing,
brass valve caps and valve stems, and
two of its recycled brass bar tollers, and
documented its attempts to obtain such
information. We do not find that DunAn
failed to cooperate by not acting in the
best of its abilities. Consistent with our
treatment of missing tolled FOPs of an
intermediate input in the first
administrative review of certain steel
nails,81 we have preliminarily applied
80 See also Statement of Administrative Action
(‘‘SAA’’) accompanying the Uruguay Round
Agreements Act (‘‘URAA’’), H.R. Rep. No. 103–316
at 870 (1994).
81 See Certain Steel Nails from the People’s
Republic of China: Final Results of the First
Antidumping Duty Administrative Review, 76 FR
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26495
facts available (‘‘FA’’) in accordance
with section 776(a)(1) of the Act. The
Department is using DunAn’s reported
FOP consumption of the intermediate
inputs received from the tollers as FA
(facts available without an adverse
inference) for DunAn.
In addition, while we find that
DunAn may not have used an
appropriate methodology to report
certain FOPs from the appropriate
period,82 we find that DunAn
cooperated to the best of its ability
during the course of this proceeding to
comply with the Department’s requests
for information. DunAn appropriately
alerted the Department of its reporting
methodology in its original section D
questionnaire response.83 DunAn
complied with all of the Department’s
requests for information.84 Thus, we
find that DunAn was forthcoming with
the information requested by the
Department in its requests for
information. Thus, DunAn did not
impede the Department’s proceeding.
Additionally, because the Department
did not request that DunAn revise its
FOP reporting prior to the preliminary
determination, we do not find that
DunAn failed to cooperate by not acting
to the best of its ability to comply with
a request for information.
Thus, pursuant to section 776(a)(1) of
the Act, we have relied on FA with
respect to DunAn’s section D response,
but without an adverse inference
prescribed under section 776(b) of the
Act. As FA, we relied on DunAn’s FOPs
as reported in its section D and
supplemental questionnaire responses
in our normal value calculations.
Currency Conversion
Where necessary, the Department
made currency conversions into U.S.
dollars, in accordance with section
773A(a) of the Act, based on the
exchange rates in effect as certified by
the Federal Reserve Bank on the date of
the U.S. sale.
Weighted-Average Dumping Margins
The preliminary weighted-average
dumping margins are as follows:
16379 (March 23, 2011) and accompanying Issues
and Decision Memorandum at Comment 17.
82 See ‘‘Normal Value’’ section, above.
83 See DunAn’s DQR at 2.
84 See, e.g., DunAn’s 1st SQR, 3rd SQR (Question
16), 3rd SQR and 4th SQR.
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FRONTSEATING SERVICE VALVES FROM section 751(a)(3)(A) of the Act, unless
the time limit is extended.
THE PRC
Exporter
Weighted-average margin
(percentage)
Zhejiang DunAn Hetian
Metal Co. Ltd. ...................
Zhejiang Sanhua Co., Ltd. ...
0.00%
0.00%
Disclosure
The Department intends to disclose
calculations performed for these
preliminary results to the parties within
10 days of the date of the public
announcement of the results of this
review in accordance with 19 CFR
351.224(b).
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Comments
Interested parties may submit written
comments no later than 30 days after the
date of publication of these preliminary
results of review.85 Rebuttal comments
must be limited to the issues raised in
the written comments and may be filed
no later than five days after the time
limit for filing the case briefs.86
Interested parties, who wish to request
a hearing, or to participate if one is
requested, must submit a written
request to the Assistant Secretary for
Import Administration, U.S. Department
of Commerce, filed electronically using
Import Administration’s Antidumping
and Countervailing Duty Centralized
Electronic Service System (‘‘IA
ACCESS’’). An electronically filed
document must be received successfully
in its entirety by the Department’s
electronic records system, IA ACCESS,
by 5 p.m. Eastern Standard Time within
30 days after the date of publication of
this notice.87 Requests should contain
the party’s name, address, and
telephone number, the number of
participants, and a list of the issues to
be discussed. If a request for a hearing
is made, we will inform parties of the
scheduled date for the hearing which
will be held at the U.S. Department of
Commerce, 14th Street and Constitution
Avenue NW., Washington, DC 20230, at
a time and location to be determined.88
Parties should confirm by telephone the
date, time, and location of the hearing.
The Department intends to issue the
final results of the administrative
review, which will include the results of
its analysis of issues raised in the briefs,
within 120 days of publication of these
preliminary results, in accordance with
85 See
19 CFR 351.309(c)(1)(ii).
19 CFR 351.309(d).
87 See 19 CFR 351.310(c).
88 See 19 CFR 351.310.
86 See
VerDate Mar<15>2010
15:20 May 03, 2012
Jkt 226001
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.89 The Department intends to
issue assessment instructions to CBP 15
days after the publication date of the
final results of this review. For any
individually examined respondent
whose weighted-average dumping
margin is above de minimis (i.e., less
than 0.50 percent) in the final results of
this review, we will calculate an
importer-specific assessment rate on the
basis of the ratio of the total amount of
antidumping duties calculated for the
importer’s examined sales and the total
entered value of sales, in accordance
with 19 CFR 351.212(b)(1).90 Where we
calculate a margin by dividing the total
dumping margins for reviewed sales to
that party by the total sales quantity
associated with those transactions, in
this and future reviews, we will direct
CBP to assess importer-specific
assessment rates based on the resulting
per-unit (i.e., per-kilogram) rates by the
weight in kilograms of each entry of the
subject merchandise during the POR.
Where an importer (or customer)specific per-unit rate is greater than de
minimis, we will apply the assessment
rate to the entered value of the
importer’s/customer’s entries during the
POR. See 19 CFR 351.212(b)(1). Where
an importer (or customer)-specific perunit 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 shipments of
the subject merchandise from the PRC
entered, or withdrawn from warehouse,
for consumption on or after the
publication date, as provided by
sections 751(a)(2)(C) of the Act: (1) For
DunAn and Sanhua, which have
separate rates, the cash deposit rates
will be those established in the final
89 See
19 CFR 351.212(b).
these preliminary results, the Department
applied the assessment rate calculation method
adopted in Final Modification for Reviews, i.e., on
the basis of monthly average-to-average
comparisons using only the transactions associated
with that importer with offsets being provided for
non-dumped comparisons. See Antidumping
Proceeding: Calculation of the Weighted-Average
Dumping Margin and Assessment Rate in Certain
Antidumping Duty Proceedings; Final Modification,
77 FR 8103, February 14, 2012.
90 In
PO 00000
Frm 00010
Fmt 4703
Sfmt 4703
results of this review (except, if the rates
are zero or de minimis, then zero cash
deposit will be required); (2) for
previously investigated or reviewed PRC
and non-PRC exporters not listed above
that received a separate rate in a prior
segment of this proceeding, the cash
deposit rate will continue to be the
exporter-specific rate; (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 55.62 percent;
and (4) for all non-PRC exporters of
subject merchandise which have not
received their own rate, the cash deposit
rate will be the rate applicable to the
PRC exporter that supplied that nonPRC exporter. These deposit
requirements, when imposed, shall
remain in effect until further notice.
Notification To Importers
This notice serves as a reminder to
importers of their responsibility under
19 CFR 351.402(f)(2) to file a certificate
regarding the reimbursement of
antidumping duties prior to liquidation
of the relevant entries during this
review period. Failure to comply with
this requirement could result in the
Secretary’s presumption that
reimbursement of antidumping duties
occurred and the subsequent assessment
of double antidumping duties.
This administrative review and notice
are in accordance with sections
751(a)(1) and 777(i) of the Act and 19
CFR 351.213.
Dated: April 30, 2012.
Ronald K. Lorentzen,
Acting Assistant Secretary for Import
Administration.
[FR Doc. 2012–10839 Filed 5–3–12; 8:45 am]
BILLING CODE 3510–DS–P
DEPARTMENT OF COMMERCE
International Trade Administration
[A–570–904]
Certain Activated Carbon From the
People’s Republic of China:
Preliminary Results of the Fourth
Antidumping Duty Administrative
Review, and Intent To Rescind in Part
Import Administration,
International Trade Administration,
Department of Commerce.
SUMMARY: The Department of Commerce
(‘‘Department’’) is conducting the fourth
administrative review of the
antidumping duty order on certain
activated carbon from the People’s
Republic of China (‘‘PRC’’) for the
period April 1, 2010, through March 31,
AGENCY:
E:\FR\FM\04MYN1.SGM
04MYN1
Agencies
[Federal Register Volume 77, Number 87 (Friday, May 4, 2012)]
[Notices]
[Pages 26489-26496]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-10839]
[[Page 26489]]
=======================================================================
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-933]
Frontseating Service Valves From the People's Republic of China:
Preliminary Results of the 2010-2011 Antidumping Duty Administrative
Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: In response to requests from interested parties, the
Department of Commerce (``the Department'') is conducting an
administrative review of the antidumping duty order on frontseating
service valves (``FSVs'') from the People's Republic of China
(``PRC''), covering the period April 1, 2010 through March 31, 2011.
We have preliminarily determined that neither respondent in this
administrative review, Zhejiang DunAn Hetian Metal Co., Ltd.
(``DunAn'') or Zhejiang Sanhua Co., Ltd. (``Sanhua'') made sales in the
United States at prices below normal value (``NV'') during the period
of review (``POR''). We invite interested parties to comment on these
preliminary results. Parties who submit comments are requested to
submit with each argument a summary of the argument. 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: May 4, 2012.
FOR FURTHER INFORMATION CONTACT: Laurel LaCivita, Eugene Degnan, 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-
4243, and (202) 482-0414, respectively.
Background
On April 28, 2009, the Department published in the Federal Register
the antidumping duty order on FSVs from the PRC.\1\ On April 1, 2011,
the Department published in the Federal Register a notice of
opportunity to request an administrative review of the antidumping duty
order on FSVs from the PRC for the period April 1, 2010 through March
31, 2011.\2\ On April 27, 2011, in accordance with 19 CFR
351.213(b)(2), Sanhua, a foreign exporter of the subject merchandise,
requested the Department to review its sales of subject merchandise.\3\
On May 2, 2011, Parker-Hannifin Corporation (``Petitioner'') requested
that the Department conduct an administrative review of the exports of
subject merchandise made by DunAn and Sanhua during the POR.\4\ On the
same date, DunAn, a foreign exporter of the subject merchandise,
requested that the Department review its sales of subject
merchandise.\5\ On May 27, 2011, the Department initiated an
administrative review of the order on FSVs from the PRC for the POR
with respect to DunAn and Sanhua.\6\
---------------------------------------------------------------------------
\1\ See Antidumping Duty Order: Frontseating Service Valves from
the People's Republic of China, 74 FR 19196 (April 28, 2009)
(``Order'').
\2\ See Antidumping or Countervailing Duty Order, Finding, or
Suspended Investigation; Opportunity To Request Administrative
Review, 76 FR 18153, 18154 (April 1, 2011).
\3\ See Letter from Sanhua, ``Frontseating Service Valves from
the People's Republic of China; A-570-933; Request for Sec. 751
Administrative Review of Exports by Zhejiang Sanhua Co., Ltd.,''
dated April 27, 2011.
\4\ See Letter from Petitioners, ``Frontseating Service Valves
from the People's Republic of China--Request for Initiation of
Antidumping Administrative Review,'' dated May 2, 2011.
\5\ See Letter from DunAn, ``Request for Administrative Review
of the Antidumping Duty Order of Frontseating Service Valves from
the People's Republic of China (POR 4/01/2010-3/31/2011),'' dated
May 2, 2011.
\6\ See Initiation of Antidumping and Countervailing Duty
Administrative Reviews, 76 FR 30912 (May 27, 2011) (``Initiation
Notice'').
---------------------------------------------------------------------------
Between June 2011 and April 2012, the Department issued its initial
and supplemental antidumping duty questionnaires to DunAn and Sanhua.
DunAn and Sanhua submitted their responses between September 2011 and
March 2012. Petitioner did not comment on these questionnaire
responses.
On September 2, 2011, the Department requested that Import
Administration's Office of Policy provide a list of surrogate countries
for this review.\7\ On September 22, 2011, the Office of Policy issued
its list of surrogate countries.\8\ On October 11, 2011, the Department
issued a letter to interested parties seeking comments on surrogate
country selection and surrogate values (``SVs'').\9\ On November 1,
2011, Petitioner and DunAn provided surrogate country selection
comments. On November 28, Petitioner and DunAn submitted SV comments
(``Petitioner's SV Comments'' and ``DunAn's SV Comments,''
respectively). On December 12, 2011, DunAn submitted rebuttal SV
comments (``DunAn's Rebuttal SV Comments'').
---------------------------------------------------------------------------
\7\ See Memorandum to Carole Showers, Director, Office of
Policy, ``Antidumping Duty Administrative Review of Frontseating
Service Valves from the People's Republic of China: Surrogate-
Country Selection,'' dated September 2, 2011.
\8\ See Memorandum from Carole Showers, Director, Office of
Policy, ``Request for a List of Surrogate Countries for an
Administrative Review of the Antidumping Duty Order on Frontseating
Service Valves (`FSVs') from the People's Republic of China
(`China'),'' dated September 22, 2011 (``Surrogate Country List'').
\9\ See Letter to Interested Parties, ``Second Administrative
Review of the Antidumping Duty Order on Front Seating Valves from
the People's Republic of China: Request for Comments on the
Selection of a Surrogate Country and Surrogate Values,'' dated
October 11, 2011.
---------------------------------------------------------------------------
On December 13, 2011, the Department extended the time period for
completion of the preliminary results of this review by 90 days until
March 30, 2012.\10\ On March 7, 2012, the Department extended the time
period for completing the preliminary results of review by an
additional 30 days until April 29, 2012.\11\ However, because April 29,
2012, falls on a weekend, the preliminary results are now due no later
than April 30, 2012.\12\
---------------------------------------------------------------------------
\10\ See Frontseating Service Valves From the People's Republic
of China: Extension of Time for the Preliminary Results of the
Antidumping Duty Administrative Review, 76 FR 77479 (December 13,
2011).
\11\ See Frontseating Service Valves from the People's Republic
of China: Notice of Second Extension of Time Limit for the
Preliminary Results of the Antidumping Duty Administrative Review,
77 FR 13539 (March 7, 2012).
\12\ See id.; see also Notice of Clarification: Application of
``Next Business Day'' Rule for Administrative Determination
Deadlines Pursuant to the Tariff Act of 1930, As Amended, 70 FR
24533 (May 10, 2005).
---------------------------------------------------------------------------
Period of Review
The POR is April 1, 2010, through March 31, 2011.
Scope of the Order
The merchandise covered by this order is frontseating service
valves, assembled or unassembled, complete or incomplete, and certain
parts thereof. Frontseating service valves contain a sealing surface on
the front side of the valve stem that allows the indoor unit or outdoor
unit to be isolated from the refrigerant stream when the air
conditioning or refrigeration unit is being serviced. Frontseating
service valves rely on an elastomer seal when the stem cap is removed
for servicing and the stem cap metal to metal seat to create this seal
to the atmosphere during normal operation.\13\
---------------------------------------------------------------------------
\13\ The frontseating service valve differs from a backseating
service valve in that a backseating service valve has two sealing
surfaces on the valve stem. This difference typically incorporates a
valve stem on a backseating service valve to be machined of steel,
where a frontseating service valve has a brass stem. The backseating
service valve dual stem seal (on the back side of the stem), creates
a metal to metal seal when the valve is in the open position, thus,
sealing the stem from the atmosphere.
---------------------------------------------------------------------------
For purposes of the scope, the term ``unassembled'' frontseating
service valve means a brazed subassembly
[[Page 26490]]
requiring any one or more of the following processes: the insertion of
a valve core pin, the insertion of a valve stem and/or O ring, the
application or installation of a stem cap, charge port cap or tube dust
cap. The term ``complete'' frontseating service valve means a product
sold ready for installation into an air conditioning or refrigeration
unit. The term ``incomplete'' frontseating service valve means a
product that when sold is in multiple pieces, sections, subassemblies
or components and is incapable of being installed into an air
conditioning or refrigeration unit as a single, unified valve without
further assembly.
The major parts or components of frontseating service valves
intended to be covered by the scope under the term ``certain parts
thereof'' are any brazed subassembly consisting of any two or more of
the following components: a valve body, field connection tube, factory
connection tube or valve charge port. The valve body is a rectangular
block, or brass forging, machined to be hollow in the interior, with a
generally square shaped seat (bottom of body). The field connection
tube and factory connection tube consist of copper or other metallic
tubing, cut to length, shaped and brazed to the valve body in order to
create two ports, the factory connection tube and the field connection
tube, each on opposite sides of the valve assembly body. The valve
charge port is a service port via which a hose connection can be used
to charge or evacuate the refrigerant medium or to monitor the system
pressure for diagnostic purposes.
The scope includes frontseating service valves of any size,
configuration, material composition or connection type. Frontseating
service valves are classified under subheading 8481.80.1095, and also
have been classified under subheading 8415.90.80.85, of the Harmonized
Tariff Schedule of the United States (``HTSUS''). It is possible for
frontseating service valves to be manufactured out of primary materials
other than copper and brass, in which case they would be classified
under HTSUS subheadings 8481.80.3040, 8481.80.3090, or 8481.80.5090. In
addition, if unassembled or incomplete frontseating service valves are
imported, the various parts or components would be classified under
HTSUS subheadings 8481.90.1000, 8481.90.3000, or 8481.90.5000. The
HTSUS subheadings are provided for convenience and customs purposes,
but the written description of the scope of this proceeding is
dispositive.
Non-Market Economy Country Status
No interested party contested the Department's treatment of the PRC
as a non-market economy (``NME'') country in this administrative
review, and the Department has treated the PRC as an NME country in all
past antidumping duty investigations and administrative reviews.\14\
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 a NME in this proceeding.
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\14\ 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).
---------------------------------------------------------------------------
Surrogate Country
When the Department is investigating imports from an NME country,
section 773(c)(1) of the Act directs it to base NV, in most
circumstances, on the NME producer's factors of production (``FOP''),
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
utilize, to the extent possible, the prices or costs of 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.\15\ The sources of the surrogate factor values
are discussed under the ``Factor Valuations'' section below and in the
Factor Valuation Memorandum,\16\ which is on file in the Central
Records Unit, Room 7046 of the main Department building.
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\15\ See Import Administration Policy Bulletin 04.1: Non-Market
Economy Surrogate Country Selection Process (March 1, 2004)
(``Policy Bulletin'').
\16\ See Memorandum to the File, ``2010-2011 Administrative
Review of the Antidumping Duty Order on Frontseating Service Valves
from the People's Republic of China: Factor Valuation Memorandum for
the Preliminary Results of Review,'' dated April 30, 2012 (``Factor
Valuation Memorandum'').
---------------------------------------------------------------------------
In examining which country to select as its primary surrogate
country for this proceeding, the Department first determined that
Colombia, Indonesia, the Philippines, South Africa, Thailand, and
Ukraine are countries comparable to the PRC in terms of economic
development.\17\ Once the Department has identified countries that are
economically comparable to the PRC, it identifies those countries which
are significant producers of comparable merchandise.
---------------------------------------------------------------------------
\17\ See Surrogate Country List.
---------------------------------------------------------------------------
Petitioner submitted a letter stating that Thailand is an
appropriate surrogate country because: (1) Thailand is at a level of
economic development comparable to the PRC; (2) of the six countries at
a level of economic development to the PRC, Thailand is the most
significant producer of comparable merchandise; (3) the World Trade
Atlas (``WTA'') has import values for direct materials, energy and
packaging inputs used to manufacture the merchandise under
consideration; and, (4) the Department recently used Thailand as the
surrogate country in the preliminary determination of the antidumping
duty investigation of galvanized steel wire from the PRC.\18\
---------------------------------------------------------------------------
\18\ See Letter from Petitioner, ``Petitioner's Comments on
Surrogate Country Selection in the Second Administrative Review of
Certain Frontseating Service Valves from the People's Republic of
China,'' dated November 1, 2011 (``Petitioner's Surrogate Country
Selection Letter'') at 1-2.
---------------------------------------------------------------------------
DunAn submitted a letter stating that the Philippines is an
appropriate surrogate country because: (1) The Philippines is at a
level of economic development comparable to the PRC; (2) the
Philippines is a significant producer of comparable merchandise; (3)
the Philippines offers the most specific, comprehensive and reliable
surrogate value data of all the potential surrogate countries.\19\
---------------------------------------------------------------------------
\19\ See Letter from DunAn, ``Surrogate Country Comments in the
Antidumping Duty Investigation on Frontseating Service Valves from
the People's Republic of China,'' dated November 1, 2011 (``DunAn's
Surrogate Country Selection Letter'') at 1-2.
---------------------------------------------------------------------------
After evaluating interested parties' comments, the Department has
determined that the Philippines is the appropriate surrogate country to
use in this review in accordance with section 773(c)(4) of the Act. The
Department based its decision on the following facts: (1) The
Philippines is at a level of economic development comparable to that of
the PRC; \20\ (2) the Philippines, in terms of total value of net
exports, is a significant producer of comparable merchandise; \21\ and,
as explained below, (3) the Philippines provides the best opportunity
to use quality, publicly available data to value the FOPs, including
surrogate financial data.
---------------------------------------------------------------------------
\20\ See Surrogate Country List.
\21\ See DunAn's Surrogate Country Selection Letter at 2-3 and
Exhibit 1.
---------------------------------------------------------------------------
Therefore, because the Philippines best represents the experience
of producers of comparable merchandise operating in a surrogate
country, we have selected the Philippines as the surrogate country and,
accordingly,
[[Page 26491]]
have calculated NV using Philippine prices to value DunAn's and
Sanhua's FOPs, when available and appropriate. We have obtained and
relied upon publicly available information to value all FOPs.
In accordance with 19 CFR 351.301(c)(3)(ii), interested parties may
submit publicly available information to value the FOPs within 20 days
after the date of publication of the preliminary results of review.\22\
---------------------------------------------------------------------------
\22\ In accordance with 19 CFR 351.301(c)(1), for the final
determination of this review, interested parties may submit factual
information to rebut, clarify, or correct factual information
submitted by an interested party less than ten days before, on, or
after the applicable deadline for submission of such factual
information. However, the Department notes that 19 CFR 351.301(c)(1)
permits new information only insofar as it rebuts, clarifies, or
corrects information recently placed on the record. The Department
generally cannot accept the submission of additional, previously
absent-from-the-record alternative SV information pursuant to 19 CFR
351.301(c)(1). See Glycine from the People's Republic of China:
Final Results of Antidumping Duty Administrative Review and Final
Rescission, in Part, 72 FR 58809 (October 17, 2007), and
accompanying Issues and Decision Memorandum at Comment 2.
---------------------------------------------------------------------------
Separate Rates
A designation of a country as an NME remains in effect until it is
revoked by the Department.\23\ 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.\24\
---------------------------------------------------------------------------
\23\ See section 771(18)(C)(i) of the Act.
\24\ See Notice of Final Determination of Sales at Less Than
Fair Value, and Affirmative Critical Circumstances, In Part: Certain
Lined Paper Products From the People's Republic of China, 71 FR
53079 (September 8, 2006) (``Lined Paper from the PRC''); see also
Final Determination of Sales at Less Than Fair Value and Final
Partial Affirmative Determination of Critical Circumstances: Diamond
Sawblades and Parts Thereof From the People's Republic of China, 71
FR 29303 (May 22, 2006).
---------------------------------------------------------------------------
In the Initiation Notice, the Department notified parties of the
application and certification process by which exporters may obtain
separate rate status in NME proceedings.\25\ It is the Department's
policy to assign all exporters of subject merchandise in an NME country
a single rate unless an exporter can demonstrate that it is
sufficiently independent so as to be entitled to a separate rate.
Exporters can demonstrate this independence through the absence of both
de jure and de facto governmental control over export activities. The
Department analyzes each entity exporting the subject merchandise under
a test arising from 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 further developed in Notice of Final
Determination of Sales at Less Than Fair Value: Silicon Carbide From
the People's Republic of China, 59 FR 22585 (May 2, 1994) (``Silicon
Carbide''). However, if the Department determines that a company is
wholly foreign-owned or located in a market economy, then a separate
rate analysis is not necessary to determine whether it is independent
from government control.\26\
---------------------------------------------------------------------------
\25\ See Initiation Notice, 76 FR 30913.
\26\ 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).
---------------------------------------------------------------------------
Separate Rate Recipients
DunAn and Sanhua each reported that it is a wholly Chinese-owned
company.\27\ Therefore, the Department must analyze whether these
respondents can demonstrate the absence of both de jure and de facto
governmental control over export activities.
---------------------------------------------------------------------------
\27\ See DunAn's Section A Questionnaire Response, dated July
11, 2010 (``DunAn's AQR'') at 2-19; Sanhua's Section A Questionnaire
Response, dated July 11, 2011 (``Sanhua's AQR'') at 2.
---------------------------------------------------------------------------
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 20589.
---------------------------------------------------------------------------
The evidence provided by DunAn and Sanhua supports a preliminary
finding of de jure absence of governmental control based on the
following: (1) An absence of restrictive stipulations associated with
their businesses and export licenses; (2) applicable legislative
enactments decentralizing control of companies; and (3) formal measures
by the government decentralizing control of companies.\29\
---------------------------------------------------------------------------
\29\ See Foreign Trade Law of the People's Republic of China,
contained in Sanhua's AQR, at Exhibit A-2. See also DunAn's AQR at
3-4.
---------------------------------------------------------------------------
b. Absence of De Facto Control
Typically, the Department considers four factors in evaluating
whether each respondent is subject to de facto government control of
its export functions: (1) Whether the export prices are set by or are
subject to the approval of a government 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.
---------------------------------------------------------------------------
\30\ See Silicon Carbide, 59 FR 22587; see also Notice of Final
Determination of Sales at Less Than Fair Value: Furfuryl Alcohol
From the People's Republic of China, 60 FR 22544, 22545 (May 8,
1995).
---------------------------------------------------------------------------
The evidence provided by DunAn and Sanhua supports a preliminary
finding of de facto absence of government control based on the
following: (1) The absence of evidence that the export prices are set
by or are subject to the approval of a government agency; \31\ (2) the
respondents have authority to negotiate and sign contracts and other
agreements; \32\ (3) the respondents have autonomy from the government
in making decisions regarding the selection of management; \33\ and (4)
the respondents retain the proceeds of their export sales and make
independent decisions regarding disposition of profits or financing of
losses.\34\
---------------------------------------------------------------------------
\31\ See DunAn's AQR, at 8-9 and Sanhua's AQR at 7-8 and Exhibit
A-5.
\32\ See DunAn's AQR, at 8-9 and Sanhua's AQR at 8-9.
\33\ See DunAn's AQR, at 10-11 and Sanhua's AQR at 9-10.
\34\ See DunAn's AQR, at 11-12 and Sanhua's AQR at 10-12.
---------------------------------------------------------------------------
Therefore, the evidence placed on the record of this review by
DunAn and Sanhua demonstrates an absence of de jure and de facto
government control with respect to DunAn's and Sanhua's exports of the
merchandise under review, in accordance with the criteria identified in
Sparklers and Silicon Carbide. Accordingly, we have determined that
DunAn and Sanhua have demonstrated their eligibility for a separate
rate.
Fair Value Comparisons
To determine whether sales of FSVs to the United States by DunAn
and Sanhua were made at less than NV, the Department compared
constructed export price (``CEP'') to NV, as described in the
``Constructed Export Price'' and ``Normal Value'' sections of this
notice. In these preliminary results, the Department applied the
weighted-average dumping margin calculation method adopted in
Antidumping Proceedings: Calculation of the Weighted-Average Dumping
Margin and
[[Page 26492]]
Assessment Rate in Certain Antidumping Proceedings: Final
Modification.\35\ In particular, the Department compared monthly
weighted-average export prices (or constructed export prices) with
monthly weighted-average normal values and granted offsets for non-
dumped comparisons in the calculation of the weighted average dumping
margin.
---------------------------------------------------------------------------
\35\ See Antidumping Proceedings: Calculation of the Weighted-
Average Dumping Margin and Assessment Rate in Certain Antidumping
Proceedings: Final Modification, 77 FR 8101 (February 14, 2012)
(``Final Modification for Reviews'').
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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 DunAn's and Sanhua's sales because the sales were made by U.S.
affiliates in the United States.
We calculated CEP based on delivered prices to unaffiliated
purchasers in the United States. We made adjustments, where applicable,
to the reported gross unit prices for billing adjustments to arrive at
the price at which the subject merchandise is first sold in the United
States to an unaffiliated customer. We made deductions from the U.S.
sales price for movement expenses in accordance with section 772(c)(2)
of the Act. These included, where applicable, foreign inland freight
from plant to the port of exportation, foreign brokerage and handling,
ocean freight, marine insurance, U.S. inland freight from port to the
warehouse, U.S. freight from warehouse to customer, U.S. warehousing,
U.S. customs duty, and U.S. brokerage and handling. In accordance with
section 772(d)(1) of the Act, the Department deducted, where
applicable, commissions, credit 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 accordance with section
772(d) of the Act, we calculated DunAn's and Sanhua's credit expenses
and inventory carrying costs based on each company's respective short-
term interest rate. In addition, we deducted CEP profit in accordance
with sections 772(d)(3) and 772(f) of the Act.\36\
---------------------------------------------------------------------------
\36\ For a detailed description of all adjustments, see
Memoranda titled ``Frontseating Service Valves from the People's
Republic of China: Analysis Memorandum for the Preliminary Results
of the 2010-2011 Administrative Review: Zhejiang DunAn Hetian Metal
Co. Ltd.,'' (``DunAn Preliminary Analysis Memorandum''), dated April
30, 2012; and, ``Frontseating Service Valves (``FSVs'') from the
People's Republic of China (``PRC''): Analysis Memorandum for the
Preliminary Results of the 2010-2011 Administrative Review: Zhejiang
Sanhua Co., Ltd. (``Sanhua''),'' (``Sanhua Preliminary Analysis
Memorandum''), dated April 30, 2012.
---------------------------------------------------------------------------
Normal Value
Section 773(c)(1) of the Act provides that the Department shall
determine NV using a factors of production methodology if the
merchandise is exported from an NME country and the Department finds
that the available 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. When determining NV in an NME context,
the Department will base NV on FOPs because the presence of government
controls on various aspects of these economies renders price
comparisons and the calculation of production costs invalid under our
normal methodologies. The Department's questionnaire requires that
DunAn and Sanhua each provide information regarding the weighted-
average FOPs across all of the company's plants and/or suppliers that
produce the merchandise under consideration, not just the FOPs from a
single plant or supplier. This methodology ensures that the
Department's calculations are as accurate as possible.\37\
---------------------------------------------------------------------------
\37\ See, e.g., Final Determination of Sales at Less Than Fair
Value and Critical Circumstances: Certain Malleable Iron Pipe
Fittings From the People's Republic of China, 68 FR 61395 (October
28, 2003), and accompanying Issue and Decision Memorandum at Comment
19.
---------------------------------------------------------------------------
In accordance with 19 CFR 351.408(c)(1), the Department will
normally use publicly available information to find an appropriate SV
to value FOPs, but when a producer sources an input from a ME and pays
for it in ME currency, the Department may value the factor using the
actual price paid for the input.\38\ DunAn and Sanhua each reported
that they did not purchase inputs from ME suppliers for the production
of the merchandise under consideration.\39\
---------------------------------------------------------------------------
\38\ See 19 CFR 351.408(c)(1); see also Shakeproof Assembly
Components, Div. of Ill. Tool Works, Inc. v. United States, 268 F.3d
1376, 1382-1383 (Fed. Cir. 2001) (affirming the Department's use of
market-based prices to value certain FOPs).
\39\ See DunAn's Section D Questionnaire response (``DunAn's
DQR'') at 6, and Sanhua's Section D Questionnaire response, dated
August 3, 2011 (``Sanhua's DQR'') at 7.
---------------------------------------------------------------------------
We calculated NV based on FOPs in accordance with section 773(c)(3)
and (4) of the Act and 19 CFR 351.408(c). The FOPs include but are not
limited to: (1) Hours of labor required; (2) quantities of raw
materials employed; (3) amounts of energy and other utilities consumed;
and (4) representative capital costs. The Department used FOPs reported
by DunAn and Sanhua for direct materials, energy, labor, by-products,
and packing materials.
DunAn used unaffiliated tollers for the production of recycled
brass bar, copper tubing, brass valve caps and valve stems.\40\ DunAn
reported the FOPs of the unaffiliated tollers of brass bar, except for
two tollers that would not provide full information.\41\ We requested
DunAn to report the FOPs of the unaffiliated tollers of the other
components.\42\ DunAn reported that it attempted to obtain FOP's from
all of its unaffiliated tollers of copper tubing, brass valve caps and
valve stems, but that the tollers were unable or unwilling to cooperate
with the Department's request for information. DunAn documented these
attempts for the record.\43\ Consequently, we do not find that DunAn
failed to cooperate by not acting in the best of its abilities.
Consistent with our treatment of missing tolled FOPs of an intermediate
input in the first administrative review of certain steel nails,\44\ we
have preliminarily applied facts available (``FA'') in accordance with
section
[[Page 26493]]
776(a)(1) of the Act.\45\ The Department is using DunAn's reported
consumption of the intermediate inputs received from the tollers as FA
(facts available without an adverse inference) for DunAn.
---------------------------------------------------------------------------
\40\ See DunAn's letter, ``DunAn Questionnaire Response to
Question 16 of the Third Supplemental Questionnaire in the Second
Administrative Review of the Antidumping Duty Order on Frontseating
Service Valves from the people's Republic of China,'' dated February
21, 2012 (``3rd SQR (Question 16)''), at 2.
\41\ See DunAn's DQR at Exhibit D-19; and DunAn's letter,
``DunAn Third Supplemental Questionnaire Response in the Second
Administrative Review of the Antidumping Duty Order on Frontseating
Service Valves from the people's Republic of China,'' dated February
27, 2012 (``3rd SQR'').
\42\ See letter from the Department, ``Front Seating Service
Values from the People's Republic of China: Zhejiang DunAn Hetian
Metal Co., Ltd. (``DunAn''): Fourth Supplemental Questionnaire,''
dated March 1, 2012.
\43\ See letter from DunAn, ``Fourth Supplemental Questionnaire
Response in the Second Administrative Review of the Antidumping Duty
Order on Frontseating Service Valves from the People's Republic of
China,'' dated March 22, 2012 (``4th SQR''), at 1-2, and Exhibit 1,
with respect to the tollers of copper tubing, brass valve caps and
valve stems. With respect to brass bar, see DunAn's 3rd SQR
(Question 16) at 8.
\44\ See Certain Steel Nails from the People's Republic of
China: Final Results of the First Antidumping Duty Administrative
Review, 76 FR 16379 (March 23, 2011) and accompanying Issues and
Decision Memorandum at Comment 17.
\45\ See the ``Facts Available'' section of this notice.
---------------------------------------------------------------------------
DunAn reported that it produced model SFJH-308-DG8 (``DG8'') in its
entirety prior to the POR,\46\ and that it produced the valve bodies
for models SFJI-314-DG16 (``DG16'') and SFJI-314-DG20 (``DG20'') prior
to the POR, but completed certain components (brass valve caps and
valve stems),\47\ final assembly, and packing during the current
POR.\48\ Consequently, DunAn explained that it reported per-unit FOPs
in the section D database based on its production experience at the
time when the models were produced.\49\ Thus, DunAn explained that the
FOPs for model DG8 were based entirely on consumption rates during the
previous administrative review.\50\ However, for models DG16 and DG20,
DunAn explained that it based the FOPs for the valve bodies, brass
scrap, and most raw material inputs on the consumption rates of the
prior POR,\51\ but that it based FOPs for brass valve caps and
stems,\52\ assembly, and packing on the consumption rates for the
current POR.\53\
---------------------------------------------------------------------------
\46\ See DunAn's DQR at 2.
\47\ See DunAn's 3rd SQR (Question 16) at 2.
\48\ See DunAn's DQR at 2.
\49\ See DunAn's DQR at 2 and DunAn's 3rd SQR (Question 16) at
1-2.
\50\ See DunAn's DQR at 2.
\51\ See DunAn's DQR at 2 and 15.
\52\ See DunAn's 3rd SQR (Question 16) at 2.
\53\ See DunAn's DQR at 2.
---------------------------------------------------------------------------
After a careful examination of its questionnaire and supplemental
responses, we have determined that DunAn's reporting methodology may
not be appropriate for the purposes of this antidumping duty review.
Because models DG16 and DG20 were completed (e.g., entered into
finished goods inventory) during the current POR, we consider these
models to have been produced during the current POR.\54\ Therefore, we
have requested DunAn to revise its questionnaire response to report all
factors of production (including factors for all material and packing
inputs, components (tolled or produced in-house), tolled round brass
bar, brass scrap, labor, energy, water, ammonia and acid wash) for
models DG16 and DG20 based on its production experience during the
current POR.\55\
---------------------------------------------------------------------------
\54\ See section 751(a)(2) of the Act (directing the Department
in an administrative review to determine the normal value of each
entry of subject merchandise); section 773(c)(1) of the Act
(requiring the Department to determine normal value based upon ``the
factors of production utilized in producing the merchandise'')
(emphasis added).
\55\ See the Department's letter to DunAn, ``Front Seating
Service Values from the People's Republic of China: Zhejiang DunAn
Hetian Metal Co., Ltd. (``DunAn''): Fifth Supplemental
Questionnaire,'' dated April 10, 2012 (``5th Supplemental
Questionnaire'').
---------------------------------------------------------------------------
Because this response is not due until after the preliminary
results, we have used DunAn's reported FOPs as FA in accordance with
section 776(a)(1) of the Act, for the purposes of these preliminary
results.\56\ However, for the final results of review, we will make our
determination based on DunAn's full set of questionnaire responses,
including its response to the Department's 5th Supplemental
Questionnaire, as appropriate.
---------------------------------------------------------------------------
\56\ See the ``Facts Available'' section of this notice.
---------------------------------------------------------------------------
DunAn and Sanhua separately reported that they each generate brass
scrap during the production process of merchandise under consideration
and requested an offset for this scrap.\57\ In addition, Sanhua
reported that it also generates copper scrap in the production of
merchandise under consideration, and requested an additional offset for
this scrap.\58\ Sanhua established that it sold all of the brass and
copper scrap that it produced during the POR. Therefore, for these
preliminary results, we have granted Sanhua a by-product offset for
brass and copper scrap because it demonstrated that there is commercial
value to this scrap.\59\ DunAn also established commercial value for
its scrap by demonstrating that it sold a portion of the scrap that it
produced during the POR, and provided the remaining scrap to
unaffiliated processors for production into recycled bar. Accordingly,
we have granted DunAn a by-product offset for its brass scrap generated
during production during the POR.\60\
---------------------------------------------------------------------------
\57\ See DunAn's DQR at D-8 and Exhibits D-5, D-15 through 18
and Sanhua's DQR at 17-19 and Exhibit D-10a.
\58\ See id.
\59\ See Sanhua's Preliminary Analysis Memorandum.
\60\ See DunAn's Preliminary Analysis Memorandum.
---------------------------------------------------------------------------
Factor Valuations
In accordance with section 773(c) of the Act, the Department
calculated NV based on FOPs reported by DunAn and Sanhua for the POR.
To calculate NV, the Department multiplied the reported per-unit factor
consumption quantities by publicly available Philippine SVs. In
selecting the SVs, the Department considered the quality, specificity,
and contemporaneity of the data. The Department adjusted input prices
by including freight costs to make them delivered prices, as
appropriate. Specifically, the Department added to Philippine import
surrogate values a Philippine 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. This adjustment
is in accordance with the decision of the U.S. Court of Appeals for the
Federal Circuit in Sigma Corp. v. United States, 117 F.3d 1401, 1407-08
(Fed. Cir. 1997). A detailed description of all SVs used to value
DunAn's and Sanhua's reported FOPs may be found in the Factor Valuation
Memorandum.
For the preliminary results, in accordance with the Department's
practice, except where noted below, we used data from the Philippine
import statistics in the Global Trade Atlas (``GTA'') and other
publicly available Philippine sources in order to calculate SVs for
DunAn and Sanhua's FOPs (i.e., direct materials, energy, and packing
materials) and certain movement expenses. In selecting the best
available information for valuing FOPs in accordance with section
773(c)(1) of the Act, the Department's practice is to select, to the
extent practicable, SVs which are non-export average values, most
contemporaneous with the POR, product-specific, and tax-exclusive.\61\
The record shows that data in the Philippine import statistics, as well
as those from the other Philippine sources, are contemporaneous with
the POR, product-specific, and tax-exclusive.\62\ In those instances
where we could not obtain publicly available information
contemporaneous to the POR with which to value factors, we adjusted the
SVs using, where appropriate, the Philippine Producer Price Index
(``PPI'') inflators as published in the International Monetary Fund's
International Financial Statistics.\63\
---------------------------------------------------------------------------
\61\ See, e.g., Notice of Preliminary Determination of Sales at
Less Than Fair Value, Negative Preliminary Determination of Critical
Circumstances and Postponement of Final Determination: Certain
Frozen and Canned Warmwater Shrimp From the Socialist Republic of
Vietnam, 69 FR 42672, 42682 (July 16, 2004), unchanged in Final
Determination of Sales at Less Than Fair Value: Certain Frozen and
Canned Warmwater Shrimp from the Socialist Republic of Vietnam, 69
FR 71005 (December 8, 2004).
\62\ See Factor Valuation Memorandum.
\63\ See Factor Valuation Memorandum. See also, e.g., Certain
Kitchen Appliance Shelving and Racks From the People's Republic of
China: Preliminary Determination of Sales at Less Than Fair Value
and Postponement of Final Determination, 74 FR 9591, 9600 (March 5,
2009) (``Kitchen Racks Prelim''), unchanged in Certain Kitchen
Appliance Shelving and Racks From the People's Republic of China:
Final Determination of Sales at Less than Fair Value, 74 FR 36656
(July 24, 2009) (``Kitchen Racks Final'').
---------------------------------------------------------------------------
[[Page 26494]]
However, with respect to four inputs, arsenic alloy, crystal
silicon, phosphorus, and silicon, there was no reasonably
contemporaneous import data into the Philippines was available. As a
result, we valued these inputs using import data into Indonesia as
recorded in the GTA. In accordance with section 773(c)(4) of the Act,
the Department has determined that Indonesia is at a level of economic
development comparable to the PRC and is a significant producer of
merchandise comparable to the subject merchandise.\64\ In addition, in
accordance with our practice,\65\ the GTA import data with respect to
Indonesia represents non-export average values and is contemporaneous
with the POR, product-specific, and tax-exclusive.
---------------------------------------------------------------------------
\64\ See Surrogate Country List; see also Petitioner's Surrogate
Country Selection Letter at 2, showing that Indonesia had exports of
23 million USD of comparable merchandise during the POR.
\65\ See, e.g., Notice of Preliminary Determination of Sales at
Less Than Fair Value, Negative Preliminary Determination of Critical
Circumstances and Postponement of Final Determination: Certain
Frozen and Canned Warmwater Shrimp From the Socialist Republic of
Vietnam, 69 FR 42672, 42682 (July 16, 2004), unchanged in Final
Determination of Sales at Less Than Fair Value: Certain Frozen and
Canned Warmwater Shrimp from the Socialist Republic of Vietnam, 69
FR 71005 (December 8, 2004).
---------------------------------------------------------------------------
Furthermore, with regard to Philippine and Indonesian import-based
SVs, we have disregarded prices that we have reason to believe or
suspect may be subsidized, such as those from Indonesia, South Korea,
India, and Thailand. We have found in other proceedings that these
countries maintain broadly available, non-industry-specific export
subsidies and, therefore, it is reasonable to infer that all exports to
all markets from these countries may be subsidized.\66\ We are also
guided by the statute's legislative history that explains that it is
not necessary to conduct a formal investigation to ensure that such
prices are not subsidized.\67\ Rather, the Department was instructed by
Congress to base its decision on information that is available to it at
the time it is making its determination. In accordance with the
foregoing, we have not used prices from these countries in calculating
the Philippine import-based SVs.
---------------------------------------------------------------------------
\66\ See Certain Frozen Fish Fillets from the Socialist Republic
of Vietnam: Preliminary Results and Preliminary Partial Rescission
of Antidumping Duty Administrative Review, 70 FR 54007, 54011
(September 13, 2005), unchanged in Certain Frozen Fish Fillets From
the Socialist Republic of Vietnam: Final Results of the First
Administrative Review, 71 FR 14170 (March 21, 2006); and China Nat'l
Mach. Import & Export Corp. v. United States, 293 F. Supp. 2d 1334
(CIT 2003), affirmed 104 Fed. Appx. 183 (Fed. Cir. 2004).
\67\ See H.R. Rep. No. 100-576 at 590 (1988).
---------------------------------------------------------------------------
In these preliminary results, the Department calculated the labor
input using data on industry-specific labor cost from the primary
surrogate country (i.e., the Philippines), as described in Labor
Methodologies. The Department relied on the ILO's Yearbook Chapter 6A
labor cost data for the Philippines for the year 2008, because this is
the most recent Chapter 6A data available for the Philippines. The
Department further determined that the two-digit description under
ISIC-Revision 3-D (``28-Manufacture of Fabricated Metal Products'') is
the best available information because it is specific to the industry
being examined and, therefore, is derived from industries that produce
comparable merchandise. Accordingly, relying on Chapter 6A of the
Yearbook, the Department calculated the labor input using labor cost
data reported by the Philippines to the ILO under Sub-Classification 28
of the ISIC-Revision 3-D, in accordance with section 773(c)(4) of the
Act. For further information on the calculation of the wage rate, see
Factor Valuation Memorandum.
The ILO data from Chapter 6A of the Yearbook, which was used to
value labor, reflects all costs related to labor, including wages,
benefits, housing, training, etc. Pursuant to Labor Methodologies, the
Department's practice is to consider whether financial ratios reflect
labor expenses that are included in other elements of the respondent's
factors of production (e.g., general and administrative expenses).\68\
The financial statements used to calculate financial ratios in this
review were sufficiently detailed to allow the Department to isolate
labor expenses from other expenses such as selling, general and
administrative expenses. Therefore, the Department revised its
calculation of surrogate financial ratios consistent with Labor
Methodologies to exclude items incorporated in the labor wage rate data
in Chapter 6A of the ILO data. As a result, bonuses and other forms of
compensation included in the ILO's calculation of wages are now
excluded from our calculation of labor in our surrogate financial
ratios.\69\
---------------------------------------------------------------------------
\68\ See id. at 36094.
\69\ See Factor Valuation Memorandum.
---------------------------------------------------------------------------
We valued electricity, diesel and kerosene using contemporaneous
Philippine data from The Cost of Doing Business in Camarines Sur
available at the Philippine government's Web site for the province:
http://www.camarinessur.gov.ph. These data pertained only to industrial
consumption.\70\
---------------------------------------------------------------------------
\70\ See id.
---------------------------------------------------------------------------
We valued natural gas using data obtained from EnergyBiz Magazine's
January/February 2006 edition, in which the American Chemistry
Council's data for Indonesian natural gas prices of January 2006 are
cited. We inflated this rate to be contemporaneous with the POR by
applying PPI inflators.\71\
---------------------------------------------------------------------------
\71\ See id.; see also Certain Steel Wheels From the People's
Republic of China: Notice of Preliminary Determination of Sales at
Less Than Fair Value, Partial Affirmative Preliminary Determination
of Critical Circumstances, and Postponement of Final Determination,
76 FR 67703, 67713 (November 2, 2011).
---------------------------------------------------------------------------
We valued water using an average of the basic rates charged by The
Philippines Maynilad for Business Group II (mostly industrial) users.
These rates were in effect in 2011 and do not include taxes or
surcharges. We did not inflate the rate since all data points are
contemporaneous with the POR.\72\
---------------------------------------------------------------------------
\72\ See Factor Valuation Memorandum.
---------------------------------------------------------------------------
We valued truck freight expenses by averaging the rates charged by
the Confederation of Truckers Association of the Philippines, Inc. and
the distances to 92 destinations within the Philippines. We adjusted
the rates downward by 20 percent to account for price increases
effective January 2011. The adjusted rates reflect prices in effect in
2010.\73\
---------------------------------------------------------------------------
\73\ See id.
---------------------------------------------------------------------------
We valued brokerage and handling expenses using a price list of
export procedures necessary to export a standardized cargo of goods in
the Philippines, as published in the World Bank's Doing Business 2012,
Economy Profile: Philippines publication.\74\
---------------------------------------------------------------------------
\74\ See id.
---------------------------------------------------------------------------
We valued marine insurance using a price quote for July 2010, which
we obtained from RJG Consultants. RJG Consultants is a market-economy
provider of marine insurance. We did not inflate this rate since it is
contemporaneous with the POR.\75\
---------------------------------------------------------------------------
\75\ See id.
---------------------------------------------------------------------------
19 CFR 351.408(c)(4) directs the Department to value overhead,
general, and administrative expenses (``SG&A'') and profit using non-
proprietary information gathered from producers of identical or
comparable merchandise in the surrogate country. In this administrative
review, Petitioner submitted the 2010 financial statements of Halcyon
Technology Public Company Limited (``Halcyon Technology''), a Thai
corporation engaged in manufacturing, customized production, and
distribution of polycrystalline diamond (``PCD'') cutting tools to
serve the manufacturers of electronic parts and the auto parts
industries, and Patkol Public Company
[[Page 26495]]
Limited (``Patkol''), a Thai producer of machinery and equipment, and a
supplier of engineering services in the ice making, commercial cool-
store, and freezing industries; a producer of dairy, tuna, shrimp, and
alcoholic beverage processing equipment; and a supplier of services for
the on-site fabrication, transportation, and installation of tanks and/
or plant and tank relocation.\76\ Patkol is also a supplier of sanitary
stainless steel machinery and equipment, including high velocity
stainless steel pumps, pipes, tees, bends, valves, and fittings, which
are imported from Europe and the United States. It is also a supplier
of spare parts for evaporative condensers, axial fans, Luang Chi
cooling towers, tube ice machines and block ice plants, equipment for
refrigeration systems, refrigeration spare parts, and ammonia gas
detectors, as well as a reseller of refrigeration pumps and spare parts
from Germany.
---------------------------------------------------------------------------
\76\ See letter from Petitioner, ``Petitioner's Pre-Preliminary
Results Surrogate Value Submission in the Second Administrative
Review of Certain Frontseating Service Valves from the People's
Republic of China: Case No. A-570-933,'' dated November 28, 2011, at
Attachment 2.
---------------------------------------------------------------------------
DunAn provided the 2010 audited financial statements of Concord
Metals, Inc. (``Concord Metals''), a Philippine producer of brass, and
cast iron and galvanized iron fittings, and FVC Philippines, Inc.
(``FVC Philippines''), a producer of cast iron valves serving the
petroleum and chemical industry, the machinery and shipbuilding
industries, the paper manufacturing and spinning industries, the
electric power industry, and the gas and water service industry.\77\
---------------------------------------------------------------------------
\77\ See letter from DunAn, ``First Surrogate Value Submission
for DunAn in the Antidumping Duty Investigation on Frontseating
Service Valves from the People's Republic of China, dated November
28, 2011, (``DunAn's 1st SV Submission'') at Exhibit 9A (for Concord
Metals) and 9B (for FVC Philippines).
---------------------------------------------------------------------------
We did not use Halcyon Technology's and Patkol's financial
statements because there is no indication that either of these two
companies produced merchandise that is identical or comparable to the
subject merchandise and they are not located in our primary surrogate
country. We did not use Concord Metals' because the financial
statements indicated that all of its merchandise consists of purchased
goods,\78\ and its Web site indicates that its products may have been
produced in the PRC.\79\
---------------------------------------------------------------------------
\78\ See DunAn's 1st SV Submission at Exhibit 9A, Notes to the
Financial Statements, at note 7.
\79\ See Factor Valuation Memorandum.
---------------------------------------------------------------------------
As a result, we have preliminarily determined to use the
contemporaneous 2010 audited financial statements of FVC Philippines as
the basis for calculating the surrogate financial ratios in this
review. FVC Philippines produces valves and earned a profit during the
POR. There is no record evidence to indicate that it received benefits
that the Department has a basis to believe or suspect to be
countervailable. Further, its audited financial statements are complete
and sufficiently detailed to disaggregate materials, labor, overhead,
and SG&A expenses. For a complete listing of all the inputs and a
detailed discussion about our SV selections, see Factor Valuation
Memorandum.
Facts Available
Section 776(a)(2) of the Act provides that, if an interested party:
(A) Withholds information that has been requested by the Department;
(B) fails to provide such information in a timely manner or in the form
or manner requested subject to sections 782(c)(1) and (e) of the Act;
(C) significantly impedes a proceeding under the antidumping statute;
or (D) provides such information but the information cannot be
verified, the Department shall, subject to section 782(d) of the Act,
use facts otherwise available in reaching the applicable determination.
Furthermore, section 776(b) of the Act states that if the Department
``finds that an interested party has failed to cooperate by not acting
to the best of its ability to comply with a request for information
from the administering authority or the Commission, the administering
authority or the Commission * * *, in reaching the applicable
determination under this title, may use an inference that is adverse to
the interests of that party in selecting from among the facts otherwise
available.'' \80\
---------------------------------------------------------------------------
\80\ See also Statement of Administrative Action (``SAA'')
accompanying the Uruguay Round Agreements Act (``URAA''), H.R. Rep.
No. 103-316 at 870 (1994).
---------------------------------------------------------------------------
In this instance, because DunAn was unable to obtain the FOPs of
unaffiliated tollers for the production of the intermediate inputs of
copper tubing, brass valve caps and valve stems, and two of its
recycled brass bar tollers, and documented its attempts to obtain such
information. We do not find that DunAn failed to cooperate by not
acting in the best of its abilities. Consistent with our treatment of
missing tolled FOPs of an intermediate input in the first
administrative review of certain steel nails,\81\ we have preliminarily
applied facts available (``FA'') in accordance with section 776(a)(1)
of the Act. The Department is using DunAn's reported FOP consumption of
the intermediate inputs received from the tollers as FA (facts
available without an adverse inference) for DunAn.
---------------------------------------------------------------------------
\81\ See Certain Steel Nails from the People's Republic of
China: Final Results of the First Antidumping Duty Administrative
Review, 76 FR 16379 (March 23, 2011) and accompanying Issues and
Decision Memorandum at Comment 17.
---------------------------------------------------------------------------
In addition, while we find that DunAn may not have used an
appropriate methodology to report certain FOPs from the appropriate
period,\82\ we find that DunAn cooperated to the best of its ability
during the course of this proceeding to comply with the Department's
requests for information. DunAn appropriately alerted the Department of
its reporting methodology in its original section D questionnaire
response.\83\ DunAn complied with all of the Department's requests for
information.\84\ Thus, we find that DunAn was forthcoming with the
information requested by the Department in its requests for
information. Thus, DunAn did not impede the Department's proceeding.
Additionally, because the Department did not request that DunAn revise
its FOP reporting prior to the preliminary determination, we do not
find that DunAn failed to cooperate by not acting to the best of its
ability to comply with a request for information.
---------------------------------------------------------------------------
\82\ See ``Normal Value'' section, above.
\83\ See DunAn's DQR at 2.
\84\ See, e.g., DunAn's 1st SQR, 3rd SQR (Question 16), 3rd SQR
and 4th SQR.
---------------------------------------------------------------------------
Thus, pursuant to section 776(a)(1) of the Act, we have relied on
FA with respect to DunAn's section D response, but without an adverse
inference prescribed under section 776(b) of the Act. As FA, we relied
on DunAn's FOPs as reported in its section D and supplemental
questionnaire responses in our normal value calculations.
Currency Conversion
Where necessary, the Department made currency conversions into U.S.
dollars, in accordance with section 773A(a) of the Act, based on the
exchange rates in effect as certified by the Federal Reserve Bank on
the date of the U.S. sale.
Weighted-Average Dumping Margins
The preliminary weighted-average dumping margins are as follows:
[[Page 26496]]
Frontseating Service Valves From the PRC
------------------------------------------------------------------------
Weighted-
Exporter average margin
(percentage)
------------------------------------------------------------------------
Zhejiang DunAn Hetian Metal Co. Ltd.................... 0.00%
Zhejiang Sanhua Co., Ltd............................... 0.00%
------------------------------------------------------------------------
Disclosure
The Department intends to disclose calculations performed for these
preliminary results to the parties within 10 days of the date of the
public announcement of the results of this review in accordance with 19
CFR 351.224(b).
Comments
Interested parties may submit written comments no later than 30
days after the date of publication of these preliminary results of
review.\85\ Rebuttal comments must be limited to the issues raised in
the written comments and may be filed no later than five days after the
time limit for filing the case briefs.\86\ Interested parties, who wish
to request a hearing, or to participate if one is requested, must
submit a written request to the Assistant Secretary for Import
Administration, U.S. Department of Commerce, filed electronically using
Import Administration's Antidumping and Countervailing Duty Centralized
Electronic Service System (``IA ACCESS''). An electronically filed
document must be received successfully in its entirety by the
Department's electronic records system, IA ACCESS, by 5 p.m. Eastern
Standard Time within 30 days after the date of publication of this
notice.\87\ Requests should contain the party's name, address, and
telephone number, the number of participants, and a list of the issues
to be discussed. If a request for a hearing is made, we will inform
parties of the scheduled date for the hearing which will be held at the
U.S. Department of Commerce, 14th Street and Constitution Avenue NW.,
Washington, DC 20230, at a time and location to be determined.\88\
Parties should confirm by telephone the date, time, and location of the
hearing. The Department intends to issue the final results of the
administrative review, which will include the results of its analysis
of issues raised in the briefs, within 120 days of publication of these
preliminary results, in accordance with section 751(a)(3)(A) of the
Act, unless the time limit is extended.
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\85\ See 19 CFR 351.309(c)(1)(ii).
\86\ See 19 CFR 351.309(d).
\87\ See 19 CFR 351.310(c).
\88\ See 19 CFR 351.310.
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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.\89\ The Department intends to issue assessment
instructions to CBP 15 days after the publication date of the final
results of this review. For any individually examined respondent whose
weighted-average dumping margin is above de minimis (i.e., less than
0.50 percent) in the final results of this review, we will calculate an
importer-specific assessment rate on the basis of the ratio of the
total amount of antidumping duties calculated for the importer's
examined sales and the total entered value of sales, in accordance with
19 CFR 351.212(b)(1).\90\ Where we calculate a margin by dividing the
total dumping margins for reviewed sales to that party by the total
sales quantity associated with those transactions, in this and future
reviews, we will direct CBP to assess importer-specific assessment
rates based on the resulting per-unit (i.e., per-kilogram) rates by the
weight in kilograms of each entry of the subject merchandise during the
POR. Where an importer (or customer)-specific per-unit rate is greater
than de minimis, we will apply the assessment rate to the entered value
of the importer's/customer's entries during the POR. See 19 CFR
351.212(b)(1). Where an importer (or customer)-specific per-unit 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).
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\89\ See 19 CFR 351.212(b).
\90\ In these preliminary results, the Department applied the
assessment rate calculation method adopted in Final Modification for
Reviews, i.e., on the basis of monthly average-to-average
comparisons using only the transactions associated with that
importer with offsets being provided for non-dumped comparisons. See
Antidumping Proceeding: Calculation of the Weighted-Average Dumping
Margin and Assessment Rate in Certain Antidumping Duty Proceedings;
Final Modification, 77 FR 8103, February 14, 2012.
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Cash Deposit Requirements
The following cash deposit requirements will be effective upon
publication of the final results of this administrative review for
shipments of the subject merchandise from the PRC entered, or withdrawn
from warehouse, for consumption on or after the publication date, as
provided by sections 751(a)(2)(C) of the Act: (1) For DunAn and Sanhua,
which have separate rates, the cash deposit rates will be those
established in the final results of this review (except, if the rates
are zero or de minimis, then zero cash deposit will be required); (2)
for previously investigated or reviewed PRC and non-PRC exporters not
listed above that received a separate rate in a prior segment of this
proceeding, the cash deposit rate will continue to be the exporter-
specific rate; (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 55.62 percent; and (4) for all non-
PRC exporters of subject merchandise which have not received their own
rate, the cash deposit rate will be the rate applicable to the PRC
exporter that supplied that non-PRC exporter. These deposit
requirements, when imposed, shall remain in effect until further
notice.
Notification To Importers
This notice serves as a reminder to importers of their
responsibility under 19 CFR 351.402(f)(2) to file a certificate
regarding the reimbursement of antidumping duties prior to liquidation
of the relevant entries during this review period. Failure to comply
with this requirement could result in the Secretary's presumption that
reimbursement of antidumping duties occurred and the subsequent
assessment of double antidumping duties.
This administrative review and notice are in accordance with
sections 751(a)(1) and 777(i) of the Act and 19 CFR 351.213.
Dated: April 30, 2012.
Ronald K. Lorentzen,
Acting Assistant Secretary for Import Administration.
[FR Doc. 2012-10839 Filed 5-3-12; 8:45 am]
BILLING CODE 3510-DS-P