Certain Pasta From Italy: Notice of Preliminary Results of Antidumping Duty Administrative Review, Preliminary No Shipment Determination and Preliminary Intent To Revoke Order, in Part, 46377-46385 [2012-19057]

Download as PDF Federal Register / Vol. 77, No. 150 / Friday, August 3, 2012 / Notices response to material submitted during the foregoing period may be submitted during the subsequent 15-day period to October 17, 2012. A copy of the application will be available for public inspection at the Office of the Executive Secretary, Foreign-Trade Zones Board, Room 2111, U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230–0002, and in the ‘‘Reading Room’’ section of the Board’s Web site, which is accessible via www.trade.gov/ ftz. For further information, contact Elizabeth Whiteman at Elizabeth.Whiteman@trade.gov or (202) 482–0473. Dated: July 30, 2012. Andrew McGilvray, Executive Secretary. [FR Doc. 2012–19061 Filed 8–2–12; 8:45 am] BILLING CODE P DEPARTMENT OF COMMERCE Foreign-Trade Zones Board [B–58–2012] TKELLEY on DSK3SPTVN1PROD with NOTICES Foreign-Trade Zone 37—Orange County, NY, Notification of Proposed Production Activity, Takasago International Corporation (Fragrances), Harriman, NY Takasago International Corporation (Takasago) submitted a notification of proposed production activity for their facility located in Harriman, New York. The notification conforming to the requirements of the regulations of the Board (15 CFR 400.22) was received on July 26, 2012 The Takasago facility is located within Site 10 of FTZ 37. The facility is used for the manufacturing of fragrance compounds. Production under FTZ procedures could exempt Takasago from customs duty payments on the foreign status components used in export production. On its domestic sales, Takasago would be able to choose the duty rates during customs entry procedures that apply to fragrances (duty-free) for the foreign status inputs noted below. Customs duties also could possibly be deferred or reduced on foreign status production equipment. Components and materials sourced from abroad include: Caryophyllene acetate; cooling agents; coolact; DH citronellol; DH citronellal; florasantol; hydroxycitronellal DMA; hedirosa; kovanol; 1aurinal; lemon oil; longozal; L-citrol; mercaptomenthone; meth-4propyl-1, 3-oxathia; muscone; meth fenchol; thiogeraniol; verdone; furfural; heliotropine; meth caproate; terpene T VerDate Mar<15>2010 17:33 Aug 02, 2012 Jkt 226001 ‘‘SP’’; thesaron; cis-jasmone; citronellolL; trepanol; menthol; musk; oxalide; perilla oil; cyclohexyl lactone; hotact VBE; santalex T; heliotropyl acetate; ambretone; menthol-L synthetic flakes; citral natural; citronellyl formate; citronellyl tiglate; coniferan; fenchyl ALC; hindinol; isoproppoxy ether; isobornyl methyl ether; menthone; ionones and methylionones; orbitone; pinene; TH geranyl acetate; bornyl acetate; citronellal extra; dihydromyrcenol; fenchyl acetate; fenchyl alcohol; dimethyl dioxolan; isopropoxyethyl; lavender oil; limonene-L; levosandol; myrcene; methyl ionone gamma; nerol; nopyl acetate; phellandrene; terpinen-4-ol; tetrahydro myrcenol; terpinene; estragole; neryl acetate; suzaral; citronellyl nitrile; camphene; citronellal natural; geraniol; methyl dioxolan; citral; violet; isobornyl methyl ether; cypressan; terpinene gamma; cedanol; ambrinol; methyl ionone; and other aroma chemicals, mixtures of odiferous substances and essential oils (duty rate ranges from duty free to 7%). Public comment is invited from interested parties. Submissions shall be addressed to the Board’s Executive Secretary at the address below. The closing period for their receipt is September 12, 2012. A copy of the notification will be available for public inspection at the Office of the Executive Secretary, Foreign-Trade Zones Board, Room 2111, U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230–0002, and in the ‘‘Reading Room’’ section of the Board’s Web site, which is accessible via www.trade.gov/ ftz. For further information, contact Elizabeth Whiteman at Elizabeth.Whiteman@trade.gov or (202) 482–0473. Dated: July 30, 2012. Andrew McGilvray, Executive Secretary. [FR Doc. 2012–19063 Filed 8–2–12; 8:45 am] BILLING CODE 3510–DS–P PO 00000 46377 DEPARTMENT OF COMMERCE International Trade Administration [A–475–818] Certain Pasta From Italy: Notice of Preliminary Results of Antidumping Duty Administrative Review, Preliminary No Shipment Determination and Preliminary Intent To Revoke Order, in Part Import Administration, International Trade Administration, Department of Commerce. AGENCY: In response to requests by interested parties, the Department of Commerce (‘‘the Department’’) is conducting an administrative review of the antidumping duty order on certain pasta (‘‘pasta’’) from Italy for the period of review (‘‘POR’’) July 1, 2010, through June 30, 2011. This review covers the following seven companies: Botticelli Mediterraneo S.a.r.l. (‘‘Botticelli’’), Fiamma Vesuviana S.r.L. (‘‘Fiamma’’), Industria Alimentare Filiberto Bianconi 1947 S.p.A. (‘‘Filiberto’’), Pastificio Fratelli Cellino, S.r.l. (‘‘Fratelli’’), Pastificio Attilio Mastromauro Granoro S.r.L. (‘‘Granoro’’), Rummo S.p.A. Molino e Pastificio and its affiliates (‘‘Rummo’’), and Pastificio Zaffiri (‘‘Zaffiri’’). We preliminarily find that Rummo, Filiberto, Fratelli, and Zaffiri sold subject merchandise at less than normal value (NV) (dumping). We further find that there were no exports of subject merchandise to the United States during the POR by Fiamma and Botticelli. Finally, in response to its request for revocation and because this would be the third year of no dumping by Granoro, we preliminarily intend to revoke the antidumping duty order with regard to Granoro. If these preliminary results are adopted in the final results of this administrative review, we will instruct U.S. Customs and Border Protection (‘‘CBP’’) to assess antidumping duties on all appropriate entries of subject merchandise during the POR. Interested parties are invited to comment on these preliminary results. SUMMARY: DATES: Effective Date: August 3, 2012. FOR FURTHER INFORMATION CONTACT: Dennis McClure or George McMahon AD/CVD Operations, Office 3, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482–5973 or (202) 482– 1167, respectively. SUPPLEMENTARY INFORMATION Frm 00005 Fmt 4703 Sfmt 4703 E:\FR\FM\03AUN1.SGM 03AUN1 46378 Federal Register / Vol. 77, No. 150 / Friday, August 3, 2012 / Notices Background On July 24, 1996, the Department published in the Federal Register the antidumping duty order on pasta from Italy.1 On July 1, 2011, the Department published a notice of opportunity to request an administrative review of the antidumping duty order on certain pasta from Italy.2 Pursuant to requests from interested parties,3 the Department published in the Federal Register the notice of initiation of this antidumping duty administrative review with respect to the following companies for the period July 1, 2010, through June 30, 2011: Botticelli, Fiamma, Filiberto, Labor S.r.L. (‘‘Labor’’), PAM. S.p.A. and its affiliate, Liguori Pastificio dal 1820 SpA (‘‘PAM’’), P.A.P. SNC Di Pazienza G.B. & C. (‘‘P.A.P.’’), Premiato Pastificio Afeltra S.r.L. (‘‘Afeltra’’), Pasta Lensi S.r.l. (‘‘Lensi’’), Zaffiri, Granoro,4 Pastificio Di Martino Gaetano & F.lli SpA (‘‘Di Martino’’), Fratelli, Pastificio Lucio Garofalo S.p.A. (‘‘Garofalo’’), Pastificio Riscossa F.lli Mastromauro S.p.A. (‘‘Riscossa’’), Rummo, Rustichella d’Abruzzo S.p.A. (‘‘Rustichella’’) and Industria Alimentare Colavita, S.p.A. (‘‘Indalco’’). On September 13, 2011, the Department announced its intention to select mandatory respondents based on U.S. Customs and Border Protection (‘‘CBP’’) data.5 On October 3, 2011, the Department selected Garofalo and TKELLEY on DSK3SPTVN1PROD with NOTICES 1 See Notice of Antidumping Duty Order and Amended Final Determination of Sales at Less Than Fair Value: Certain Pasta From Italy, 61 FR 38547 (July 24, 1996). 2 See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity To Request Administrative Review, 76 FR 38609 (July 1, 2011). 3 The petitioners include New World Pasta Company, Dakota Growers Pasta Company and American Italian Pasta Company (collectively, ‘‘petitioners’’). 4 The Department notes that, on August 31, 2010, the Department deferred the 7/1/2009—6/30/2010 administrative review for Pastificio Attilio Mastromauro-Pasta Granoro S.R.L. for one year. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Deferral of Initiation of Administrative Review, 75 FR 53274 (August 31, 2010). We initiated this review one year later along with the 7/1/2010—6/30/2011 administrative review. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Requests for Revocation in Part, 76 FR 53404, 53408 (August 26, 2011) (‘‘First Initiation Notice’’). The Department amended the Initiation of the instant review to include Industria Alimentare Colavita, S.p.A., because this company was inadvertently omitted from First Initiation Notice. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Requests for Revocations in Part, 76 FR 61076 (October 3, 2011). 5 See Memorandum from Christopher Hargett to Melissa Skinner titled ‘‘Customs and Border Protection Data for Selection of Respondents for Individual Review,’’ dated September 13, 2011 (CBP Data Memo). VerDate Mar<15>2010 17:33 Aug 02, 2012 Jkt 226001 Rummo as mandatory respondents.6 On October 5, 2011, Granoro requested that it be granted voluntary respondent treatment. On October 11, 2011, Garofalo withdrew its request for a review. On November 7, 2011, Granoro withdrew its request for a deferred review of certain pasta from Italy for the POR of June 1, 2009 to June 30, 2010. On October 19, 2011, and November 17, 2011, respectively, the Department published in the Federal Register notices of partial rescission of the administrative reviews with respect to Garofalo and with respect to the deferred review of Granoro.7 On November 18, 2011, Lensi withdrew its request for a review. On November 21, 2011, Indalco and Labor withdrew their requests for a review. On November 22, 2011, Granoro timely submitted its Sections A–D Voluntary Questionnaire Response for the 2010–2011 review that remains active within the case deadlines established for the mandatory respondent, Rummo. On November 22, 2011, PAM, P.A.P., Riscossa, and Rustichella withdrew their requests for a review. On November 23, 2011, Afeltra and Di Martino withdrew their requests for a review. On December 12, 2011, the Department published in the Federal Register a notice of partial rescission of the administrative reviews with respect to Afeltra, Di Martino, Indalco, Labor, Lensi, PAM, P.A.P., Riscossa, and Rustichella.8 The instant review continues with respect to Botticelli, Fiamma, Filiberto, Fratelli, Granoro, Rummo, and Zaffiri. As noted above, Rummo was selected as and remains a mandatory respondent. Pursuant to Granoro’s November 22, 2011 request, the Department accepted Granoro as a voluntary respondent on December 12, 2011.9 Between October 2011 and June 2012, the Department issued its initial questionnaire 10 and supplemental 6 See Memorandum from Christopher Hargett to Melissa Skinner titled ‘‘Selection of Respondents for Individual Review,’’ dated October 3, 2011. 7 See Certain Pasta from Italy: Notice of Partial Rescission of Antidumping Duty Administrative Review, 76 FR 64897 (October 19, 2011); see also Certain Pasta from Italy: Notice of Partial Rescission of Antidumping Duty Administrative Review, 76 FR 71311 (November 17, 2011) (‘‘Granoro: Partial Rescission of Deferred Review’’). 8 See Certain Pasta from Italy: Notice of Partial Rescission of Antidumping Duty Administrative Review, 76 FR 77204 (December 12, 2011). 9 See Memorandum from Dennis McClure to Melissa Skinner through James Terpstra, dated December 12, 2011, titled ‘‘Treatment of Pastificio Attilio Mastromauro-Pasta Granoro S.r.L. as a Voluntary Respondent.’’ 10 The antidumping duty questionnaire issued to respondents includes section A (i.e., the section covering general information about the company) of the antidumping duty questionnaire, section B (i.e., the section covering comparison market sales), PO 00000 Frm 00006 Fmt 4703 Sfmt 4703 questionnaires to each respondent, as applicable. The Department issued the section D questionnaire to Granoro and Rummo because we disregarded sales by these companies that were below the COP in the most recently completed administrative review of each respective company. We received responses to the Department’s initial questionnaire on November 22, 2011 from Granoro. We received responses to the Department’s initial questionnaire from Rummo on December 6, 2011 (Section A), and December 12, 2011 (Sections B–D). We issued section A, B, C, and D supplemental questionnaires to both Granoro and Rummo. We received Granoro’s supplemental questionnaire responses in February and March 2012. We received Rummo’s supplemental questionnaire responses in March, April, May, and June 2012. On February 28, 2012, the Department fully extended the due date for the preliminary results of review from April 2, 2012, to July 30, 2012.11 The Department conducted the sales verification of Granoro from May 28, 2012, through June 1, 2012, in Bari, Italy. The Department conducted the cost verification of Granoro from May 21, 2012, through May 25, 2012, in Bari, Italy. Verification As provided in section 782(i) of the Act, we have verified information provided by Granoro. We conducted this verification using standard verification procedures including the examination of relevant sales and financial records and the selection and review of original documentation containing relevant information. Our verification results are outlined in the public version of our verification reports, which are on file electronically via Import Administration’s Antidumping and Countervailing Duty Centralized Electronic Service System (IA ACCESS). Access to IA ACCESS is available in the Central Records Unit, room 7046 of the main Department of Commerce building. section C (i.e., the section covering U.S. sales), and section D (i.e., the section covering the cost of production (‘‘COP’’) and constructed value (‘‘CV’’)). 11 See Certain Pasta From Italy: Extension of Time Limits for the Preliminary Results of Fifteenth Antidumping Duty Administrative Review, 77 FR 12008 (February 28, 2012). E:\FR\FM\03AUN1.SGM 03AUN1 Federal Register / Vol. 77, No. 150 / Friday, August 3, 2012 / Notices TKELLEY on DSK3SPTVN1PROD with NOTICES Preliminary Determination of No Reviewable Entries On August 30, 2011, and September 6, 2011, Fiamma 12 and Botticelli,13 respectively, reported to the Department that neither company had any exports, sales or entries of pasta subject to the antidumping order on pasta from Italy to the United States during the POR. The Department transmitted a ‘‘NoShipment Inquiry’’ to CBP regarding Botticelli and Fiamma.14 Pursuant to this inquiry, the Department received no notifications from CBP of any entries of subject merchandise from either company within the 10-day deadline. Accordingly, based on record evidence, we preliminarily determine that Botticelli and Fiamma had no reviewable entries during the POR. Our past practice concerning noshipment respondents was to rescind the administrative review if the respondent certified that it had no shipments and we confirmed the certified statement through an examination of CBP data.15 We would then instruct CBP to liquidate any entries of merchandise produced by the respondent at the deposit rate in effect on the date of entry. However, in our May 6, 2003, ‘‘automatic assessment’’ clarification, we explained that, where respondents in an administrative review demonstrated that they had no knowledge of sales through resellers to the United States, we would instruct CBP to liquidate such entries at the allothers rate applicable to the proceeding. See Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003) (‘‘Assessment Policy Notice’’). Because ‘‘as entered’’ liquidation instructions do not alleviate the concerns which the Assessment Policy Notice was intended to address, instead 12 In its letter of August 30, 2011, Fiamma stated that ‘‘Fiamma Vesuviana hereby informs the Department of Commerce that it had no exports, sales or entries of pasta subject to the antidumping order on pasta from Italy to the United States during the period of review, July 1, 2010 through June 30, 2011.’’ 13 In its letter of September 6, 2011, Botticelli stated, ‘‘Botticelli Mediterraneo further informs the Department of Commerce that it is located in Tunisia; that it produces and exports olive oil and is not involved in the production, distribution or sale of pasta in any way; and that it does not have any operations of any type in Italy.’’ 14 No entries were reported in the data which the Department relied on for its selection of respondents. See CBP Memo (BPI document) and CBP Message numbers: 2165302 and 2165303, dated June 13, 2012. 15 See 19 CFR 351.213(d)(3); see also Certain Large Diameter Carbon and Alloy Seamless Standard, Line, and Pressure Pipe (Over 41/2 Inches) From Japan: Final Results of Antidumping Duty Administrative Review, 77 FR 27428, 27430 (May 10, 2012). VerDate Mar<15>2010 17:33 Aug 02, 2012 Jkt 226001 of rescinding the review with respect to Botticelli and Fiamma, we find it appropriate to complete the review and issue liquidation instructions to CBP concerning entries for these companies following the final results of the review. If we continue to find that Botticelli and Fiamma had no reviewable transactions of subject merchandise in the final results, we will instruct CBP to liquidate any existing entries of merchandise produced by Botticelli and Fiamma but exported by other parties at the allothers rate.16 Targeted Dumping Allegations The petitioners note that they conducted their own targeted dumping analysis of Granoro’s and Rummo’s U.S. sales using the Department’s targeted dumping methodology as applied in Steel Nails and modified in Wood Flooring.17 Based on their own analysis, the petitioners argue the Department should conduct a targeted dumping analysis and employ average-totransaction comparisons without offsets should the Department find that the record supports its allegation of targeted dumping.18 Granoro and Rummo did not comment on the targeted dumping allegations submitted by the petitioners. For purposes of these preliminary results, the Department did not conduct a targeted dumping analysis. In calculating the preliminary weightedaverage dumping margin, the Department applied the calculation methodology adopted in the Final Modification for Reviews.19 In particular, the Department compared monthly, weighted-average export prices with monthly, weighted-average 16 See, e.g., Magnesium Metal From the Russian Federation: Preliminary Results of Antidumping Duty Administrative Review, 75 FR 26922, 26923 (May 13, 2010), unchanged in Magnesium Metal From the Russian Federation: Final Results of Antidumping Duty Administrative Review, 75 FR 56989 (September 17, 2010). 17 See The petitioners’ Allegation of Targeted Dumping with respect to Granoro, dated April 20, 2012, at 1–8, and the petitioners’ Allegation of Targeted Dumping with respect to Rummo, dated April 20, 2012, at 1–8, both (citing Certain Steel Nails from the People’s Republic of China: Final Determination of Sales at Less Than Fair Value and Partial Affirmative Determination of Critical Circumstances, 73 FR 33,977 (June 16, 2008) (‘‘Steel Nails’’), and accompany Issues and Decision Memorandum at Comment 8; Multilayered Wood Flooring from the People’s Republic of China: Final Determination of Sales at Less Than Fair Value, 76 FR 64318 (Oct. 18, 2011) (‘‘Wood Flooring’’), and accompanying Issues and Decision Memorandum at Comment 4). 18 See id. at 5–9 and 6–9, respectively. 19 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’’). PO 00000 Frm 00007 Fmt 4703 Sfmt 4703 46379 normal values, and granted offsets for negative comparison results in the calculation of the weighted-average dumping margins.20 Application of this methodology in these preliminary results affords parties an opportunity to meaningfully comment on the Department’s implementation of this recently adopted methodology in the context of this administrative review. Scope of the Order Imports covered by this order are shipments of certain non-egg dry pasta in packages of five pounds four ounces or less, whether or not enriched or fortified or containing milk or other optional ingredients such as chopped vegetables, vegetable purees, milk, gluten, diastasis, vitamins, coloring and flavorings, and up to two percent egg white. The pasta covered by this scope is typically sold in the retail market, in fiberboard or cardboard cartons, or polyethylene or polypropylene bags of varying dimensions. Excluded from the scope of this order are refrigerated, frozen, or canned pastas, as well as all forms of egg pasta, with the exception of non-egg dry pasta containing up to two percent egg white. Also excluded are imports of organic pasta from Italy that are accompanied by the appropriate certificate issued by the Instituto Mediterraneo Di Certificazione, by QC&I International Services, by Ecocert Italia, by Consorzio per il Controllo dei Prodotti Biologici, by Associazione Italiana per l’Agricoltura Biologica, by Codex S.r.L., by Bioagricert S.r.L., or by Instituto per la Certificazione Etica e Ambientale. Effective July 1, 2008, gluten free pasta is also excluded from this order. See Certain Pasta from Italy: Notice of Final Results of Antidumping Duty Changed Circumstances Review and Revocation, in Part, 74 FR 41120 (August 14, 2009). The merchandise subject to this order is currently classifiable under items 1902.19.20 and 1901.90.9095 of the Harmonized Tariff Schedule of the United States (‘‘HTSUS’’). Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the merchandise subject to the order is dispositive. Notice of Intent To Revoke Order, in Part On July 29, 2011, Granoro requested revocation of the order on pasta from Italy as it pertains to its sales. Pursuant to section 751(d)(1) of the Act, the Department ‘‘may revoke, in whole or in part’’ an antidumping duty order upon completion of a review. Although 20 See E:\FR\FM\03AUN1.SGM id. at 8102. 03AUN1 TKELLEY on DSK3SPTVN1PROD with NOTICES 46380 Federal Register / Vol. 77, No. 150 / Friday, August 3, 2012 / Notices Congress has not specified the procedures that the Department must follow in revoking an order, the Department has developed a procedure for revocation that is set forth at 19 CFR 351.222. Pursuant to 19 CFR 351.222(b)(2), the Department may revoke an antidumping duty order in part if it concludes that (A) an exporter or producer has sold the merchandise at not less than normal value for a period of at least three consecutive years, (B) the exporter or producer has agreed in writing to its immediate reinstatement in the order if the Secretary concludes that the exporter or producer, subsequent to the revocation, sold the subject merchandise at less than normal value, and (C) the continued application of the antidumping duty order is no longer necessary to offset dumping. Section 351.222(b)(3) of the Department’s regulations states that, in the case of an exporter that is not the producer of subject merchandise, the Department normally will revoke an order in part under 19 CFR 351.222(b)(2) only with respect to subject merchandise produced or supplied by those companies that supplied the exporter during the time period that formed the basis for revocation. A request for revocation of an order in part for a company previously found dumping must address three elements. The company requesting the revocation must do so in writing and submit the following statements with the request: (1) The company’s certification that it sold the subject merchandise at not less than normal value during the current review period and that, in the future, it will not sell at less than normal value; (2) the company’s certification that, during each of the consecutive years forming the basis of the request, it sold the subject merchandise to the United States in commercial quantities; (3) the agreement to reinstatement in the order if the Department concludes that, subsequent to revocation, the company has sold the subject merchandise at less than normal value. See 19 CFR 351.222(e)(1). We preliminarily determine that the request dated July 29, 2011, from Granoro meets all of the criteria under 19 CFR 351.222(e)(1). With regard to the criteria of 19 CFR 351.222(b)(2), our preliminary margin calculations show that Granoro sold pasta at not less than normal value during the current review period. See ‘‘Preliminary Results of Reviews’’ section below. In addition, it sold pasta at not less than normal value in the previous administrative review in which it was reviewed, including the intermediary period between the VerDate Mar<15>2010 17:33 Aug 02, 2012 Jkt 226001 previous administrative review and this ongoing review. See Certain Pasta from Italy: Notice of Final Results of the Thirteenth Antidumping Duty Administrative Review, 75 FR 81212 (December 27, 2010). Based on our examination of the sales data submitted by Granoro, we preliminarily determine that Granoro sold the subject merchandise in the United States in commercial quantities in each of the consecutive years cited by Granoro to support its request for revocation. See Granoro’s Sales Verification Report, dated July 9, 2012, at Exhibit SVE–10. Thus, we preliminarily find that the Granoro sold pasta at not less than normal value for the last three consecutive years and sold in commercial quantities all three years. Also, we preliminarily determine that application of the antidumping duty order to Granoro is no longer warranted for the following reasons: (1) The company sold pasta at not less than normal value for a period of at least three consecutive years; (2) the company has agreed to immediate reinstatement of the order if we find that it has resumed making sales at less than fair value; (3) the continued application of the order is not otherwise necessary to offset dumping. Therefore, we preliminarily determine that Granoro qualifies for revocation from the order on pasta from Italy pursuant to 19 CFR 351.222(b)(2) and, thus, we preliminarily determine to revoke the order with respect to pasta from Italy exported and/or sold to the United States by Granoro. If our intent to revoke results in revocation of the order in part with respect to merchandise exported and/or sold by Granoro, the proposed effective date of the revocation is July 1, 2011.21 Product Comparisons In accordance with section 771(16) of the Tariff Act of 1930, as amended (the Act), we first attempted to match contemporaneous sales of products sold 21 The Department amended its regulations concerning the revocation of antidumping and countervailing duty orders in whole or in part, and the termination of suspended antidumping and countervailing duty investigations. Specifically, the Department’s Final Rule eliminates the provision for revocation of an antidumping or countervailing duty order with respect to individual exporters or producers based on those individual exporters or producers having received antidumping rates of zero for three consecutive years, or countervailing duty rates of zero for five consecutive years. This Final Rule will apply to all reviews that are initiated on or after June 20, 2012, however, this provision regarding revocation does not apply to Granoro because the instant review was initiated prior to the aforementioned date. See Modification to Regulation Concerning the Revocation of Antidumping and Countervailing Duty Orders, 77 FR 29875 (May 21, 2012) (‘‘Final Rule’’). PO 00000 Frm 00008 Fmt 4703 Sfmt 4703 by Granoro and Rummo in the United States and comparison markets that were identical with respect to the following characteristics: (1) Pasta shape; (2) wheat species; (3) milling form; (4) protein content; (5) additives; and (6) enrichment. In this review, the respondents did not report the protein content as indicated on the packaging of the finished pasta, but instead reported based on their internal production records. Therefore, we clarified in a supplemental questionnaire to the respondents that they were expected to report the protein content based on the protein content indicated on the packaging of the finished product. In our calculations we used the protein content indicated on the packaging of the finished product, as reported by the respondents in their supplemental questionnaire responses. When there were no sales of identical merchandise in the comparison market to compare with U.S. sales, we compared U.S. sales with the most similar product based on the characteristics listed above, in descending order of priority. When there were no appropriate comparison market sales of comparable merchandise, we compared the merchandise sold in the United States to CV, in accordance with section 773(a)(4) of the Act. We made comparisons to weightedaverage comparison market prices that were based on all sales which passed the cost-of-production test and on those sales which did not pass the cost-ofproduction test but were made at prices which were considered to have provided for the recovery of costs within a reasonable period of time. Specifically, in making our comparisons, if an identical home market model was reported, we made comparisons to monthly weightedaverage home market prices that were based on all relevant sales during the contemporary month or, lacking such sales, to a previous or subsequent month in the shorter cost period (see ‘‘Cost Averaging Methodology’’ below). If there were no sales of an identical model available for comparison during the relevant months, we substituted the most similar above cost home market model. If there were no home market models with a difference in merchandise of less than twenty percent available, we used constructed value for comparison purposes. We calculated the weighted-average comparison market prices on a level of trade-specific basis. For purposes of the preliminary results, where appropriate, we have calculated the adjustment for differences in merchandise based on the difference in the variable cost of E:\FR\FM\03AUN1.SGM 03AUN1 Federal Register / Vol. 77, No. 150 / Friday, August 3, 2012 / Notices manufacturing (‘‘VCOM’’) between each U.S. model and the most similar home market model selected for comparison. Comparisons to Normal Value To determine whether sales of certain pasta from Italy were made in the United States at prices below NV, we compared the export price (EP) or constructed export price (CEP) to the NV, as described in the ‘‘Export Price and Constructed Export Price’’ and ‘‘Normal Value’’ sections of this notice. Pursuant to 19 CFR 351.414(c)(1) and (d), we compared the monthly weighted-average export price of U.S. transactions to the monthly weightedaverage normal value of the comparable foreign like product where there were sales made in the ordinary course of trade.22 TKELLEY on DSK3SPTVN1PROD with NOTICES Export Price and Constructed Export Price For the price to the United States, we used, as appropriate, EP or CEP, in accordance with sections 772(a) and (b) of the Act. Pursuant to section 772(a) of the Act, we used the EP methodology when the merchandise was first sold by the producer or exporter outside the United States directly to the unaffiliated purchaser in the United States prior to importation and when CEP was not otherwise warranted based on the facts on the record. We calculated CEP for those sales where a person in the United States, affiliated with the foreign exporter or acting for the account of the exporter, made the first sale to the unaffiliated purchaser in the United States of the subject merchandise. See section 772(b) of the Act. We based EP and CEP on the packed prices charged to the first unaffiliated customer in the United States and the applicable terms of sale. When appropriate, we adjusted prices to reflect billing adjustments, rebates, and early payment discounts, quantity discounts, expenses recovered from customers, and commissions. In accordance with section 772(c)(2) of the Act, we made deductions, where appropriate, for movement expenses including movement expenses incurred at the production facility, U.S. warehouse expense, inland freight, inland insurance, brokerage & handling, 22 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 Assessment Rate in Certain Antidumping Duty Proceedings; Final Modification, 77 FR 8101 (February 14, 2012). In particular, the Department compared monthly weighted-average export prices with monthly weighted-average normal values and granted offsets for non-dumped comparisons in the calculation of the weightedaverage dumping margin. VerDate Mar<15>2010 17:33 Aug 02, 2012 Jkt 226001 international freight, marine insurance, freight rebate revenue, and U.S. customs duties. With respect to Granoro, we capped the transportation recovery amounts by the amount of U.S. freight expenses, incurred on the subject merchandise, in accordance with our practice. See Certain Orange Juice from Brazil: Final Results and Partial Rescission of Antidumping Duty Administrative Review, 73 FR 46584 (August 11, 2008), and accompanying Issues and Decision Memorandum (‘‘2005–2007 OJ from Brazil’’) at Comment 7. In addition, when appropriate, we increased EP by an amount equal to the countervailing duty (‘‘CVD’’) rate attributed to export subsidies in the most recently completed CVD administrative review, in accordance with section 772(c)(1)(C) of the Act. For CEP, in accordance with section 772(d)(1) of the Act, when appropriate, we deducted from the starting price those selling expenses that were incurred in selling the subject merchandise in the United States, including direct selling expenses (cost of credit, warranty, and other direct selling expenses). These expenses also include certain indirect selling expenses incurred by unaffiliated U.S. commission agents.23 Normal Value A. Selection of Comparison Markets Section 773(a)(1) of the Act directs that NV be based on the price of the foreign like product sold in the home market, provided that the merchandise is sold in sufficient quantities (or value, if quantity is inappropriate) and that there is no particular market situation that prevents a proper comparison with the export price or constructed export price. The statute contemplates that quantities (or value) normally be considered insufficient if they are less than five percent of the aggregate quantity (or value) of sales of the subject merchandise to the United States. To determine whether there was a sufficient volume of sales in the home market to serve as a viable basis for calculating NV, we compared each respondent’s volume of home market sales of the foreign like product to the 23 See Memorandum from Dennis McClure to James Terpstra, Program Manager, entitled ‘‘Sales Analysis Memorandum for the Preliminary Results—Granoro’’ (Preliminary Results Sales Analysis Memo—Granoro), dated concurrently with this notice; see also Memorandum from George McMahon to James Terpstra, Program Manager, entitled ‘‘Sales Analysis Memorandum for the Preliminary Results—Rummo’’ (Preliminary Results Sales Analysis Memo—Rummo), dated concurrently with this notice. PO 00000 Frm 00009 Fmt 4703 Sfmt 4703 46381 volume of its U.S. sales of the subject merchandise. Pursuant to section 773(a)(1)(B) of the Act, because Granoro and Rummo each had an aggregate volume of home market sales of the foreign like product that was greater than five percent of its aggregate volume of U.S. sales of the subject merchandise, we determined that the home market was viable for both Granoro and Rummo. B. Arm’s-Length Sales Granoro reported that all of its sales to the Italian market are to unaffiliated customers; however, it made a few sales to employees and shareholders and coded such sales as affiliated sales. See Granoro’s section B questionnaire response, dated November 22, 2011. In accordance with the Department’s practice, we have excluded such sales from consideration when the sales did not pass our Arm’s Length Test. See Preliminary Results Sales Analysis Memo—Granoro. Rummo reported that all of its sales to the Italian market are to unaffiliated customers.24 In addition, Pasta Castiglione (‘‘PC’’), Rummo’s affiliated producer, reported that it did not make any sales to affiliates in the foreign market.25 Therefore, we did not apply the arm’s length test with respect to Rummo’s sales. C. Cost of Production Analysis In the most recently completed segment of the proceeding in which Granoro and Rummo participated, the Department determined that the aforementioned respondents sold the foreign like product at prices below the cost of producing the merchandise and, as a result, we excluded such sales from the calculation of normal value.26 Therefore, pursuant to section 773(b)(2)(A)(ii) of the Act, there are reasonable grounds to believe or suspect that Granoro and Rummo’s sales of the foreign like product under consideration for the determination of normal value in the instant review may have been made at prices below the COP as provided by section 773(b)(2)(A)(ii) of the Act and, therefore, outside of the ordinary course of trade. Pursuant to section 773(b)(1) of the Act, we have conducted a COP investigation of Granoro and Rummo’s 24 See Rummo’s Section B Questionnaire Response, dated December 12, 2011, at page B–9. 25 See PC’s Section A Questionnaire Response, dated December 5, 2011 at A–24. 26 See Certain Pasta From Italy: Notice of Amended Final Results of the Thirteenth Antidumping Duty Administrative Review, 76 FR 6601 (February 7, 2011) (Pasta Thirteenth Review); see also Certain Pasta from Italy: Notice of Final Results of the Tenth Administrative Review and Partial Rescission of Review, 72 FR 70298 (December 11, 2007) (‘‘Pasta Tenth Review’’). E:\FR\FM\03AUN1.SGM 03AUN1 46382 Federal Register / Vol. 77, No. 150 / Friday, August 3, 2012 / Notices sales in the comparison market (sales below cost test) and required Granoro and Rummo to submit a response to Section D of the Department’s questionnaire. 1. Cost Averaging Methodology The Department’s normal practice is to calculate an annual weighted-average cost for the POR.27 However, we recognize that possible distortions may result if we use our normal annualaverage cost method during a time of significant cost changes. In determining whether to deviate from our normal methodology of calculating an annual weighted-average cost, we evaluate the case-specific record evidence using two primary factors: (1) The change in the cost of manufacturing (‘‘COM’’) recognized by the respondent during the POR must be deemed significant; (2) the record evidence must indicate that sales during the shorter cost-averaging periods could be reasonably linked with the COP or constructed value during the same shorter cost-averaging periods.28 TKELLEY on DSK3SPTVN1PROD with NOTICES a. Significance of Cost Changes In prior cases, we established 25 percent as the threshold (between the high- and low- quarter COM) for determining that the changes in COM are significant enough to warrant a departure from our standard annualaverage cost approach.29 In the instant case, record evidence shows that Granoro and Rummo experienced significant changes (i.e., changes that exceeded 25 percent) between the high and low quarterly COM during the POR.30 This change in COM is 27 See Certain Pasta From Italy: Final Results of Antidumping Duty Administrative Review, 65 FR 77852 (December 13, 2000), and accompanying Issues and Decision Memorandum at Comment 18, and Notice of Final Results of Antidumping Duty Administrative Review: Carbon and Certain Alloy Steel Wire Rod from Canada, 71 FR 3822 (January 24, 2006), and accompanying Issues and Decision Memorandum at Comment 5 (explaining the Department’s practice of computing a single weighted-average cost for the entire period). 28 See Stainless Steel Sheet and Strip in Coils From Mexico: Final Results of Antidumping Duty Administrative Review, 75 FR 6627 (February 10, 2010) (‘‘SSSS from Mexico’’), and accompanying Issues and Decision Memorandum at Comment 6 and Stainless Steel Plate in Coils From Belgium: Final Results of Antidumping Duty Administrative Review, 73 FR 75398 (December 11, 2008) (‘‘SSPC from Belgium’’), and accompanying Issues and Decision Memorandum at Comment 4. 29 See SSPC from Belgium, and accompanying Issues and Decision Memorandum at Comment 4. 30 See Memorandum from Sheikh Hannan to Neal M. Halper, Director of Office of Accounting, entitled ‘‘Cost of Production and Constructed Value Calculation Adjustments for the Preliminary Results—Granoro’’ (‘‘Granoro Cost Calculation Memo’’), dated concurrently with this notice at 2; see also Memorandum from Heidi Schriefer to Neal M. Halper, Director of Office of Accounting, entitled ‘‘Cost of Production and Constructed Value VerDate Mar<15>2010 17:33 Aug 02, 2012 Jkt 226001 attributable primarily to the price volatility for semolina used in the production of pasta. Id. b. Linkage Between Cost and Sales Information Consistent with past precedent, because we found the changes in costs to be significant, we evaluated whether there is evidence of a linkage between the cost changes and the sales prices during the POR.31 Absent a surcharge or other pricing mechanism, the Department may alternatively look for evidence of a pattern that changes in selling prices reasonably correlate to changes in unit costs.32 To determine whether a reasonable correlation existed between the sales prices and underlying costs during the POR, we compared weighted-average quarterly prices to the corresponding quarterly COM for the control numbers with the highest volume of sales in the comparison market and in the United States. Our comparison revealed that sales and costs for Granoro and Rummo showed reasonable correlation. See Granoro Cost Calculation Memo at pages 2–3 and Rummo Cost Calculation Memo at pages 2–3. After reviewing this information and determining that changes in selling prices correlate reasonably to changes in unit costs, we preliminarily determine that there is linkage between Granoro’s and Rummo’s changing sales prices and costs during the POR.33 We have preliminarily determined that a shorter cost period approach, based on a quarterly-average COP, is appropriate for Granoro and Rummo because we have found significant cost changes in COM as well as reasonable linkage between costs and sales prices. 2. Calculation of Cost of Production Before making comparisons to normal value, we conducted a COP analysis of Granoro’s and Rummo’s sales pursuant to section 773(b)(3) of the Act to determine whether home market sales were made at prices below COP and that these costs were not recoverable within a reasonable period of time. For this analysis, the COP is based on a quarterly average COP rather than an annual Calculation Adjustments for the Preliminary Results—the Rummo Group’’ (‘‘Rummo Cost Calculation Memo’’), dated concurrently with this notice at 2. 31 See SSSS from Mexico, and accompanying Issues and Decision Memorandum at Comment 6 and SSPC from Belgium, and accompanying Issues and Decision Memorandum at Comment 4. 32 See SSPC from Belgium, and accompanying Issues and Decision Memorandum at Comment 4. 33 Id.; see also SSSS from Mexico, and accompanying Issues and Decision Memorandum at Comment 6 and SSPC from Belgium, and accompanying Issues and Decision Memorandum at Comment 4. PO 00000 Frm 00010 Fmt 4703 Sfmt 4703 average COP. See the ‘‘Cost Averaging Methodology’’ section, above, for further discussion. We calculated Granoro’s and Rummo’s quarterly COP on a productspecific basis, based on the sum of the Granoro’s and Rummo’s respective cost of materials and fabrication for the foreign like product, plus amounts for general and administrative expenses, interest expenses, and the costs of all expenses incidental to packing the merchandise. We relied on the COP information submitted by both Granoro and Rummo except the following adjustments. With respect to Granoro, we corrected several errors noted during the cost verification, revised the reported semolina costs to differentiate for the protein content (the Department’s fourth physical product characteristic), and we weight-averaged the per-unit costs for certain control numbers (CONNUMs). For further discussion of these adjustments, see Granoro Cost Calculation Memo. With respect to Rummo, we have revised Rummo’s and Pasta Castiglioni’s reported protein-specific quarterly semolina costs to correct errors discovered in the calculation of the quarterly average semolina purchase prices. We have also revised the semolina calculations to express and apply yield losses as a percentage rather than as a nominal value. We then calculated and applied a POR scrap offset for each company. See Rummo Cost Calculation Memo at 4–5. For control numbers for which there was no production during the POR or during a POR quarter we chose or calculated surrogates respectively.34 4. Cost Recovery Analysis In accordance with sections 773(b)(1)(A) and (B) of the Act, for sales found to be made below cost, we examined whether, within an extended period of time, such sales were made in substantial quantities, and whether such sales were made at prices which permitted the recovery of all costs within a reasonable period of time in the normal course of trade. As stated in section 773(b)(2)(D) of the Act, prices are considered to provide for recovery of costs if such prices are above the weighted average per-unit COP for the period of investigation or review. In light of the Court’s directives in SeAH Steel Corp. v. United States, 704 F. Supp. 2d 1353 (Ct. Int’l Trade 2010), and SeAH Steel Corporation v. United States, 764 F. Supp. 2d 1322 (Ct. Int’l. Trade 2011) to use an unadjusted 34 See Preliminary Sales Analysis Memorandum—Granoro and Preliminary Sales Analysis Memorandum—Rummo. E:\FR\FM\03AUN1.SGM 03AUN1 Federal Register / Vol. 77, No. 150 / Friday, August 3, 2012 / Notices annual average cost for purposes of the cost recovery test, in the instant review we have used the approach to test for cost recovery when using a shorter cost period methodology.35 Using the methodology adopted in SPT from Turkey, we calculated a control number specific weighted-average annual price using only those sales that were made below their quarterly COP, and compared the resulting weightedaverage price to the annual weightedaverage cost per control number. If the annual weighted-average price per control number was above the annual weighted-average cost per control number then we considered those sales to have provided for the recovery of costs and restored all such sales to the normal value pool of comparisonmarket sales available for comparison with U.S. sales. For further details regarding the cost recovery methodology and the application of our shorter-cost period methodology, see the Granoro Cost Calculation Memo at 1–2; see also the Rummo Cost Calculation Memo at 1–2. 5. Results of the Sales Below Cost Test We found that for certain products, more than 20 percent of Granoro’s and Rummo’s home market sales were made at prices below COP and, in addition, these below cost sales were made within an extended period of time and in substantial quantities. In addition, pursuant to the cost recovery analysis described above, we found that these sales were at prices which did not permit the recovery of costs within a reasonable period of time. Therefore, we disregarded these sales from the calculation of normal value, in accordance with section 773(b)(1) of the Act. TKELLEY on DSK3SPTVN1PROD with NOTICES D. Calculation of Normal Value Based on Comparison Market Prices We calculated NV based on ex-works, free on board (‘‘FOB’’) or delivered prices to comparison market customers. We made deductions from the starting price, when appropriate, for discounts and rebates. We added expenses recovered from customers. We deducted home market packing costs and added U.S. packing costs, in accordance with sections 773(a)(6)(A) and (B) of the Act. We also deducted home market movement expenses pursuant to section 773(a)(6)(B) of the Act. In addition, we made adjustments for differences in circumstances of sale (‘‘COS’’) pursuant 35 See Certain Welded Carbon Steel Pipe and Tube From Turkey; Notice of Final Results of Antidumping Duty Administrative Review, 76 FR 76939 (December 9, 2011) (‘‘SPT From Turkey’’). VerDate Mar<15>2010 17:33 Aug 02, 2012 Jkt 226001 to section 773(a)(6)(C)(iii) of the Act. Specifically, we made adjustments to normal value for comparison to Granoro’s and Rummo’s EP transactions by deducting direct selling expenses incurred for home market sales (i.e., credit expenses) and adding U.S. direct selling expenses (i.e., credit expenses) and U.S. commissions. See section 773(a)(6)(C)(iii) of the Act, and 19 CFR 351.410(c). We also made adjustments for Granoro and Rummo, in accordance with 19 CFR 351.410(e), for indirect selling expenses incurred in the home market or the United States where commissions were granted on sales in one market but not in the other, the ‘‘commission offset.’’ Specifically, where commissions are incurred in one market, but not in the other, we will limit the amount of such allowance to the amount of either the selling expenses incurred in the one market or the commissions allowed in the other market, whichever is less. When comparing U.S. sales with comparison market sales of similar, but not identical, merchandise, we also made adjustments for physical differences in the merchandise in accordance with section 773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We based this adjustment on the difference in the VCOM for the foreign like product and subject merchandise, using weighted-average costs. Sales of pasta purchased by Granoro and Rummo from unaffiliated producers and resold in the comparison market were disregarded. See Preliminary Results Sales Analysis Memo—Granoro and Preliminary Results Sales Analysis Memo—Rummo. E. Level of Trade In accordance with section 773(a)(1)(B) of the Act, we determine NV based on sales in the comparison market at the same level of trade (‘‘LOT’’) as the EP and CEP sales, to the extent practicable. When there are no sales at the same LOT, we compare U.S. sales to comparison market sales at a different LOT. When NV is based on CV, the NV LOT is that of the sales from which we derive SG&A expenses and profit. Pursuant to 19 CFR 351.412(c)(2), to determine whether comparison market sales were at a different LOT, we examine stages in the marketing process and selling functions along the chain of distribution between the producer and the unaffiliated (or arm’s-length affiliated) customers. The Department identifies the LOT based on: The starting price or constructed value (for normal value); the starting price (for EP sales); and the starting price, as adjusted PO 00000 Frm 00011 Fmt 4703 Sfmt 4703 46383 under section 772(d) of the Act (for CEP sales). If the comparison-market sales were at a different LOT and the differences affect price comparability, as manifested in a pattern of consistent price differences between the sales on which NV is based and comparisonmarket sales at the LOT of the export transaction, we will make an LOT adjustment under section 773(a)(7)(A) of the Act. Finally, if the NV LOT is more remote from the factory than the CEP LOT and there is no basis for determining whether the differences in LOT between NV and CEP affected price comparability, we will grant a CEP offset, as provided in section 773(a)(7)(B) of the Act. See Notice of Final Determination of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel Plate from South Africa, 62 FR 61731, 61732–33 (November 19, 1997). Granoro indicated there was a single level of trade for all sales in both markets, and petitioners have not claimed that multiple levels of trade existed for Granoro. Granoro provided information regarding channels of distribution and selling activities performed for different categories of customers. See Granoro’s November 22, 2011, section A response, at Exhibit 3. Granoro’s chart of specific selling functions indicates the selling functions performed for sales in both markets are virtually identical, with no significant variation across the broader categories of sales process/marketing support, freight and delivery, inventory and warehousing, and quality assurance/ warranty services. For more details, see Preliminary Results Analysis Memorandum—Granoro. We have preliminarily determined there is one single level of trade for all sales in both the home market and the U.S. market and, therefore, that no basis exists for a level of trade adjustment. Rummo reported that there was a single level of trade for its sales in the home market and claimed two levels of trade in the U.S. market. Rummo provided information regarding channels of distribution and selling activities performed for different categories of customers.36 Rummo’s and PC’s 37 charts of specific selling functions indicate the selling functions performed for sales in both markets and demonstrates that there are significantly greater sales activities performed in the home market as compared to Rummo’s 36 See Rummo’s and PC’s December 5, 2011, section A response, at Exhibits A–3 and A–4. 37 See PC’s March 8, 2012 Supplemental response at page 33. E:\FR\FM\03AUN1.SGM 03AUN1 46384 Federal Register / Vol. 77, No. 150 / Friday, August 3, 2012 / Notices U.S. sales. We have preliminarily determined that these differences support a finding that the home market sales are made at a different and more advanced stage of marketing than the level of trade of Rummo’s CEP sales. Accordingly, we have made a CEP offset to NV pursuant to section 773(a)(7)(B) of the Act.38 For a detailed description of our LOT methodology and a summary of company-specific LOT findings for these preliminary results, see our analysis contained in Preliminary Results Sales Analysis Memo—Granoro and Preliminary Results Sales Analysis Memo—Rummo. Currency Conversion For purposes of these preliminary results, we made currency conversions in accordance with section 773A(a) of the Act, based on the official exchange rates published by the Federal Reserve Bank. See Preliminary Results Sales Analysis Memo—Granoro and Preliminary Results Sales Analysis Memo—Rummo. Preliminary Results of Review As a result of our review, we preliminarily determine that the following weighted-average percentage margins exist for the period July 1, 2010, through June 30, 2011: Manufacturer/exporter Margin (percent) 39 Granoro ................................... Rummo ................................... Review-Specific Average Rate 40. Applicable to the Following Companies: Filiberto, Fratelli, and Zaffiri ............... 0.00 6.97 6.97 39 The TKELLEY on DSK3SPTVN1PROD with NOTICES antidumping duty margins for Granoro and Rummo include an adjustment for the countervailing duty offset to account for the export subsidy portion of the countervailing duties applied to these companies, as defined in the field CVDU. 40 This rate is a weight-average percentage margin calculated based on the two companies that were selected for individual review, excluding de minimis margins or margins based entirely on adverse facts available. Public Comment The Department intends to disclose the calculations performed for these preliminary results within five days of the date of publication of this notice to the parties of this proceeding, in accordance with 19 CFR 351.224(b). An 38 The Department made a CEP offset to NV for Rummo in the most recent administrative review (2005–2006) in which Rummo was a mandatory respondent. See Certain Pasta from Italy; Notice of Preliminary Results and Partial Rescission of Tenth Antidumping Duty Administrative Review, 72 FR 44082 (August 7, 2007). VerDate Mar<15>2010 17:33 Aug 02, 2012 Jkt 226001 interested party may request a hearing within 30 days of publication of this notice in the Federal Register. See 19 CFR 351.310(c). If a hearing is requested, the Department will notify interested parties of the hearing schedule. Interested parties are invited to comment on the preliminary results of this review. Interested parties may submit case briefs within 30 days of the date of publication of this notice. Rebuttal briefs, which must be limited to issues raised in the case briefs, may be filed not later than 35 days after the date of publication of this notice. Parties who submit case briefs or rebuttal briefs in this review are requested to submit with each argument (1) a statement of the issue and (2) a brief summary of the argument with an electronic version included. Pursuant to 19 CFR 351.213(h), the Department intends to issue the final results of this review, including the results of our analysis of issues raised in any submitted written comments, within 120 days after publication of this notice. expenses (e.g., international freight) from the gross sales value. The Department clarified its ‘‘automatic assessment’’ regulation on May 6, 2003 (68 FR 23954). This clarification will apply to entries of subject merchandise during the POR produced by companies included in these preliminary results of review for which the reviewed companies did not know their merchandise was destined for the United States. In such instances, we will instruct CBP to liquidate unreviewed entries at the all-others rate if there is no rate for the intermediate company(ies) involved in the transaction. For a full discussion of this clarification, see Antidumping and Countervailing Duty Proceedings: Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003). Cash Deposit Requirements To calculate the cash deposit rate, we divided the total dumping margin by the total net value of the sales during the review period. The following deposit rates will be effective upon publication of the final results of this administrative Assessment Rate review for all shipments of pasta from Italy entered, or withdrawn from Pursuant to 19 CFR 351.212(b), the warehouse, for consumption on or after Department calculated an assessment the publication date, as provided by rate for each importer of the subject merchandise. Upon issuance of the final section 751(a)(2)(C) of the Act: (1) The cash deposit rate for companies subject results of this administrative review, if to this review will be the rate any importer-specific assessment rates established in the final results of this calculated in the final results are above de minimis (i.e., at or above 0.5 percent), review, except if the rate is less than 0.5 the Department will issue appraisement percent and, therefore, de minimis, no cash deposit will be required; (2) for instructions directly to CBP to assess previously reviewed or investigated antidumping duties on appropriate companies not listed above, the cash entries by applying the assessment rate to the entered value of the merchandise. deposit rate will continue to be the company-specific rate published for the Pursuant to the Final Modification for most recent final results for a review in Reviews, ‘‘when a review is conducted applying the A–A {(average-to-average)} which that manufacturer or exporter participated; (3) if the exporter is not a comparison methodology, and the weighted-average margin of dumping for firm covered in this review, a prior review, or the original less-than-fairthe exporter or producer is determined to be zero or de minimis, no assessment value (‘‘LTFV’’) investigation, but the manufacturer is, the cash deposit rate rates will be calculated and the will be the rate established for the most Department will instruct CBP to recent final results for the manufacturer liquidate all imports from the exporter of the merchandise; and (4) if neither or producer without regard to the exporter nor the manufacturer is a antidumping duties, regardless of firm covered in this or any previous importer.’’ 41 For assessment purposes, review conducted by the Department, we calculated importer-specific the cash deposit rate will be 15.45 assessment rates for the subject percent, the all-others rate established merchandise by aggregating the in the LTFV investigation. See dumping margins for all U.S. sales to Implementation of the Findings of the each importer and dividing the amount by the total entered value of the sales to WTO Panel in US—Zeroing (EC): Notice of Determination Under Section 129 of that importer. Where appropriate, to the Uruguay Round Agreements Act and calculate the entered value, we Revocations and Partial Revocations of subtracted international movement Certain Antidumping Duty Orders, 72 FR 25261 (May 4, 2007). These cash 41 See Final Modification for Reviews, 77 FR at 8107. deposit requirements, when imposed, PO 00000 Frm 00012 Fmt 4703 Sfmt 4703 E:\FR\FM\03AUN1.SGM 03AUN1 Federal Register / Vol. 77, No. 150 / Friday, August 3, 2012 / Notices shall remain in effect until further notice. Notification to Importers This notice serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f) 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 increase the subsequent assessment of the antidumping duties by the amount of antidumping duties reimbursed. These preliminary results of administrative review are issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.221(b)(4). Dated: July 27, 2012. Paul Piquado, Assistant Secretary for Import Administration. [FR Doc. 2012–19057 Filed 8–2–12; 8:45 am] BILLING CODE 3510–DS–P DEPARTMENT OF COMMERCE International Trade Administration [A–428–820] Certain Small Diameter Seamless Carbon and Alloy Standard, Line, and Pressure Pipe From Germany: Final Results of the Expedited Third Sunset Review of the Antidumping Duty Order Import Administration, International Trade Administration, Department of Commerce. SUMMARY: On April 2, 2012, the Department of Commerce (the Department) initiated the third sunset review of the antidumping duty order on certain small diameter seamless carbon and alloy steel standard, line, and pressure pipe (seamless pipe) from Germany pursuant to section 751(c) of the Tariff Act of 1930, as amended (the Act). See Initiation of Five-Year (‘‘Sunset’’) Review, 77 FR 19643 (April 2, 2012) (Sunset Initiation). On the basis of a notice of intent to participate and an adequate substantive response filed on behalf of a domestic interested party, and no response from a respondent interested party, the Department conducted an expedited (120-day) sunset review. As a result of this sunset review, the Department finds that revocation of the antidumping duty order would likely lead to the continuation or recurrence of dumping. TKELLEY on DSK3SPTVN1PROD with NOTICES AGENCY: VerDate Mar<15>2010 17:33 Aug 02, 2012 Jkt 226001 The magnitude of dumping likely to prevail if the order were revoked is identified in the ‘‘Final Results of Review’’ section of this notice. DATES: Effective Date: August 3, 2012. FOR FURTHER INFORMATION CONTACT: Ericka Ukrow or Angelica Mendoza, AD/CVD Operations, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482–0405 or (202) 482– 3019, respectively. SUPPLEMENTARY INFORMATION: Background On April 2, 2012, the Department initiated the sunset review of the antidumping duty order on seamless pipe from Germany pursuant to section 751(c) of the Act. See Sunset Initiation. The Department received a notice of intent to participate from one domestic interested party, United States Steel Corporation (U.S. Steel), within the deadline specified in 19 CFR 351.218(d)(1)(i). The domestic interested party claimed interested party status under section 771(9)(C) of the Act as a U.S. producer of a domestic like product. We received a complete substantive response from the domestic interested party within the 30-day deadline specified in 19 CFR 351.218(d)(3)(i) on May 2, 2012. No respondent interested parties submitted responses. As a result of the timely filed, substantive response from the domestic interested party the Department conducted an expedited sunset review of the order, pursuant to section 751(c)(3)(B) of the Act and 19 CFR 351.218(e)(1)(ii)(C)(2). Scope of the Order The scope of the order includes small diameter seamless carbon and alloy standard, line and pressure pipes (seamless pipes) produced to the ASTM A–335, ASTM A–106, ASTM A–53 and API 5L specifications and meeting the physical parameters described below, regardless of application. The scope of the order also includes all products used in standard, line, or pressure pipe applications and meeting the physical parameters below, regardless of specification. For purposes of the order, seamless pipes are seamless carbon and alloy (other than stainless) steel pipes, of circular cross-section, not more than 114.3 mm (4.5 inches) in outside diameter, regardless of wall thickness, manufacturing process (hot-finished or cold-drawn), end finish (plain end, beveled end, upset end, threaded, or PO 00000 Frm 00013 Fmt 4703 Sfmt 4703 46385 threaded and coupled), or surface finish. These pipes are commonly known as standard pipe, line pipe or pressure pipe, depending upon the application. They may also be used in structural applications. Pipes produced in nonstandard wall thicknesses are commonly referred to as tubes. The seamless pipes subject to the order are currently classifiable under subheadings 7304.19.10.20, 7304.19.50.20, 7304.31.60.50, 7304.39.00.16, 7304.39.00.20, 7304.39.00.24, 7304.39.00.28, 7304.39.00.32, 7304.51.50.05, 7304.51.50.60, 7304.59.60.00, 7304.59.80.10, 7304.59.80.15, 7304.59.80.20, and 7304.59.80.25 of the Harmonized Tariff Schedule of the United States (HTSUS). The following information further defines the scope of the order, which covers pipes meeting the physical parameters described above: Specifications, Characteristics and Uses: Seamless pressure pipes are intended for the conveyance of water, steam, petrochemicals, chemicals, oil products, natural gas and other liquids and gasses in industrial piping systems. They may carry these substances at elevated pressures and temperatures and may be subject to the application of external heat. Seamless carbon steel pressure pipe meeting the American Society for Testing and Materials (ASTM) standard A–106 may be used in temperatures of up to 1000 degrees Fahrenheit, at various American Society of Mechanical Engineers (ASME) code stress levels. Alloy pipes made to ASTM standard A–335 must be used if temperatures and stress levels exceed those allowed for A–106 and the ASME codes. Seamless pressure pipes sold in the United States are commonly produced to the ASTM A–106 standard. Seamless standard pipes are most commonly produced to the ASTM A–53 specification and generally are not intended for high temperature service. They are intended for the low temperature and pressure conveyance of water, steam, natural gas, air and other liquids and gasses in plumbing and heating systems, air conditioning units, automatic sprinkler systems, and other related uses. Standard pipes (depending on type and code) may carry liquids at elevated temperatures but must not exceed relevant ASME code requirements. Seamless line pipes are intended for the conveyance of oil and natural gas or other fluids in pipe lines. Seamless line pipes are produced to the API 5L specification. Seamless pipes are commonly produced and certified to meet ASTM E:\FR\FM\03AUN1.SGM 03AUN1

Agencies

[Federal Register Volume 77, Number 150 (Friday, August 3, 2012)]
[Notices]
[Pages 46377-46385]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-19057]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-475-818]


Certain Pasta From Italy: Notice of Preliminary Results of 
Antidumping Duty Administrative Review, Preliminary No Shipment 
Determination and Preliminary Intent To Revoke Order, in Part

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

SUMMARY: In response to requests by interested parties, the Department 
of Commerce (``the Department'') is conducting an administrative review 
of the antidumping duty order on certain pasta (``pasta'') from Italy 
for the period of review (``POR'') July 1, 2010, through June 30, 2011. 
This review covers the following seven companies: Botticelli 
Mediterraneo S.a.r.l. (``Botticelli''), Fiamma Vesuviana S.r.L. 
(``Fiamma''), Industria Alimentare Filiberto Bianconi 1947 S.p.A. 
(``Filiberto''), Pastificio Fratelli Cellino, S.r.l. (``Fratelli''), 
Pastificio Attilio Mastromauro Granoro S.r.L. (``Granoro''), Rummo 
S.p.A. Molino e Pastificio and its affiliates (``Rummo''), and 
Pastificio Zaffiri (``Zaffiri''). We preliminarily find that Rummo, 
Filiberto, Fratelli, and Zaffiri sold subject merchandise at less than 
normal value (NV) (dumping). We further find that there were no exports 
of subject merchandise to the United States during the POR by Fiamma 
and Botticelli. Finally, in response to its request for revocation and 
because this would be the third year of no dumping by Granoro, we 
preliminarily intend to revoke the antidumping duty order with regard 
to Granoro. If these preliminary results are adopted in the final 
results of this administrative review, we will instruct U.S. Customs 
and Border Protection (``CBP'') to assess antidumping duties on all 
appropriate entries of subject merchandise during the POR. Interested 
parties are invited to comment on these preliminary results.

DATES: Effective Date: August 3, 2012.

FOR FURTHER INFORMATION CONTACT: Dennis McClure or George McMahon AD/
CVD Operations, Office 3, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-5973 
or (202) 482-1167, respectively.

SUPPLEMENTARY INFORMATION

[[Page 46378]]

Background

    On July 24, 1996, the Department published in the Federal Register 
the antidumping duty order on pasta from Italy.\1\ On July 1, 2011, the 
Department published a notice of opportunity to request an 
administrative review of the antidumping duty order on certain pasta 
from Italy.\2\ Pursuant to requests from interested parties,\3\ the 
Department published in the Federal Register the notice of initiation 
of this antidumping duty administrative review with respect to the 
following companies for the period July 1, 2010, through June 30, 2011: 
Botticelli, Fiamma, Filiberto, Labor S.r.L. (``Labor''), PAM. S.p.A. 
and its affiliate, Liguori Pastificio dal 1820 SpA (``PAM''), P.A.P. 
SNC Di Pazienza G.B. & C. (``P.A.P.''), Premiato Pastificio Afeltra 
S.r.L. (``Afeltra''), Pasta Lensi S.r.l. (``Lensi''), Zaffiri, 
Granoro,\4\ Pastificio Di Martino Gaetano & F.lli SpA (``Di Martino''), 
Fratelli, Pastificio Lucio Garofalo S.p.A. (``Garofalo''), Pastificio 
Riscossa F.lli Mastromauro S.p.A. (``Riscossa''), Rummo, Rustichella 
d'Abruzzo S.p.A. (``Rustichella'') and Industria Alimentare Colavita, 
S.p.A. (``Indalco'').
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    \1\ See Notice of Antidumping Duty Order and Amended Final 
Determination of Sales at Less Than Fair Value: Certain Pasta From 
Italy, 61 FR 38547 (July 24, 1996).
    \2\ See Antidumping or Countervailing Duty Order, Finding, or 
Suspended Investigation; Opportunity To Request Administrative 
Review, 76 FR 38609 (July 1, 2011).
    \3\ The petitioners include New World Pasta Company, Dakota 
Growers Pasta Company and American Italian Pasta Company 
(collectively, ``petitioners'').
    \4\ The Department notes that, on August 31, 2010, the 
Department deferred the 7/1/2009--6/30/2010 administrative review 
for Pastificio Attilio Mastromauro-Pasta Granoro S.R.L. for one 
year. See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Deferral of Initiation of Administrative 
Review, 75 FR 53274 (August 31, 2010). We initiated this review one 
year later along with the 7/1/2010--6/30/2011 administrative review. 
See Initiation of Antidumping and Countervailing Duty Administrative 
Reviews and Requests for Revocation in Part, 76 FR 53404, 53408 
(August 26, 2011) (``First Initiation Notice''). The Department 
amended the Initiation of the instant review to include Industria 
Alimentare Colavita, S.p.A., because this company was inadvertently 
omitted from First Initiation Notice. See Initiation of Antidumping 
and Countervailing Duty Administrative Reviews and Requests for 
Revocations in Part, 76 FR 61076 (October 3, 2011).
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    On September 13, 2011, the Department announced its intention to 
select mandatory respondents based on U.S. Customs and Border 
Protection (``CBP'') data.\5\ On October 3, 2011, the Department 
selected Garofalo and Rummo as mandatory respondents.\6\ On October 5, 
2011, Granoro requested that it be granted voluntary respondent 
treatment. On October 11, 2011, Garofalo withdrew its request for a 
review. On November 7, 2011, Granoro withdrew its request for a 
deferred review of certain pasta from Italy for the POR of June 1, 2009 
to June 30, 2010. On October 19, 2011, and November 17, 2011, 
respectively, the Department published in the Federal Register notices 
of partial rescission of the administrative reviews with respect to 
Garofalo and with respect to the deferred review of Granoro.\7\ On 
November 18, 2011, Lensi withdrew its request for a review. On November 
21, 2011, Indalco and Labor withdrew their requests for a review. On 
November 22, 2011, Granoro timely submitted its Sections A-D Voluntary 
Questionnaire Response for the 2010-2011 review that remains active 
within the case deadlines established for the mandatory respondent, 
Rummo. On November 22, 2011, PAM, P.A.P., Riscossa, and Rustichella 
withdrew their requests for a review. On November 23, 2011, Afeltra and 
Di Martino withdrew their requests for a review. On December 12, 2011, 
the Department published in the Federal Register a notice of partial 
rescission of the administrative reviews with respect to Afeltra, Di 
Martino, Indalco, Labor, Lensi, PAM, P.A.P., Riscossa, and 
Rustichella.\8\ The instant review continues with respect to 
Botticelli, Fiamma, Filiberto, Fratelli, Granoro, Rummo, and Zaffiri. 
As noted above, Rummo was selected as and remains a mandatory 
respondent. Pursuant to Granoro's November 22, 2011 request, the 
Department accepted Granoro as a voluntary respondent on December 12, 
2011.\9\
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    \5\ See Memorandum from Christopher Hargett to Melissa Skinner 
titled ``Customs and Border Protection Data for Selection of 
Respondents for Individual Review,'' dated September 13, 2011 (CBP 
Data Memo).
    \6\ See Memorandum from Christopher Hargett to Melissa Skinner 
titled ``Selection of Respondents for Individual Review,'' dated 
October 3, 2011.
    \7\ See Certain Pasta from Italy: Notice of Partial Rescission 
of Antidumping Duty Administrative Review, 76 FR 64897 (October 19, 
2011); see also Certain Pasta from Italy: Notice of Partial 
Rescission of Antidumping Duty Administrative Review, 76 FR 71311 
(November 17, 2011) (``Granoro: Partial Rescission of Deferred 
Review'').
    \8\ See Certain Pasta from Italy: Notice of Partial Rescission 
of Antidumping Duty Administrative Review, 76 FR 77204 (December 12, 
2011).
    \9\ See Memorandum from Dennis McClure to Melissa Skinner 
through James Terpstra, dated December 12, 2011, titled ``Treatment 
of Pastificio Attilio Mastromauro-Pasta Granoro S.r.L. as a 
Voluntary Respondent.''
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    Between October 2011 and June 2012, the Department issued its 
initial questionnaire \10\ and supplemental questionnaires to each 
respondent, as applicable. The Department issued the section D 
questionnaire to Granoro and Rummo because we disregarded sales by 
these companies that were below the COP in the most recently completed 
administrative review of each respective company. We received responses 
to the Department's initial questionnaire on November 22, 2011 from 
Granoro. We received responses to the Department's initial 
questionnaire from Rummo on December 6, 2011 (Section A), and December 
12, 2011 (Sections B-D). We issued section A, B, C, and D supplemental 
questionnaires to both Granoro and Rummo. We received Granoro's 
supplemental questionnaire responses in February and March 2012. We 
received Rummo's supplemental questionnaire responses in March, April, 
May, and June 2012.
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    \10\ The antidumping duty questionnaire issued to respondents 
includes section A (i.e., the section covering general information 
about the company) of the antidumping duty questionnaire, section B 
(i.e., the section covering comparison market sales), section C 
(i.e., the section covering U.S. sales), and section D (i.e., the 
section covering the cost of production (``COP'') and constructed 
value (``CV'')).
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    On February 28, 2012, the Department fully extended the due date 
for the preliminary results of review from April 2, 2012, to July 30, 
2012.\11\
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    \11\ See Certain Pasta From Italy: Extension of Time Limits for 
the Preliminary Results of Fifteenth Antidumping Duty Administrative 
Review, 77 FR 12008 (February 28, 2012).
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    The Department conducted the sales verification of Granoro from May 
28, 2012, through June 1, 2012, in Bari, Italy. The Department 
conducted the cost verification of Granoro from May 21, 2012, through 
May 25, 2012, in Bari, Italy.

Verification

    As provided in section 782(i) of the Act, we have verified 
information provided by Granoro. We conducted this verification using 
standard verification procedures including the examination of relevant 
sales and financial records and the selection and review of original 
documentation containing relevant information. Our verification results 
are outlined in the public version of our verification reports, which 
are on file electronically via Import Administration's Antidumping and 
Countervailing Duty Centralized Electronic Service System (IA ACCESS). 
Access to IA ACCESS is available in the Central Records Unit, room 7046 
of the main Department of Commerce building.

[[Page 46379]]

Preliminary Determination of No Reviewable Entries

    On August 30, 2011, and September 6, 2011, Fiamma \12\ and 
Botticelli,\13\ respectively, reported to the Department that neither 
company had any exports, sales or entries of pasta subject to the 
antidumping order on pasta from Italy to the United States during the 
POR. The Department transmitted a ``No-Shipment Inquiry'' to CBP 
regarding Botticelli and Fiamma.\14\ Pursuant to this inquiry, the 
Department received no notifications from CBP of any entries of subject 
merchandise from either company within the 10-day deadline. 
Accordingly, based on record evidence, we preliminarily determine that 
Botticelli and Fiamma had no reviewable entries during the POR.
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    \12\ In its letter of August 30, 2011, Fiamma stated that 
``Fiamma Vesuviana hereby informs the Department of Commerce that it 
had no exports, sales or entries of pasta subject to the antidumping 
order on pasta from Italy to the United States during the period of 
review, July 1, 2010 through June 30, 2011.''
    \13\ In its letter of September 6, 2011, Botticelli stated, 
``Botticelli Mediterraneo further informs the Department of Commerce 
that it is located in Tunisia; that it produces and exports olive 
oil and is not involved in the production, distribution or sale of 
pasta in any way; and that it does not have any operations of any 
type in Italy.''
    \14\ No entries were reported in the data which the Department 
relied on for its selection of respondents. See CBP Memo (BPI 
document) and CBP Message numbers: 2165302 and 2165303, dated June 
13, 2012.
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    Our past practice concerning no-shipment respondents was to rescind 
the administrative review if the respondent certified that it had no 
shipments and we confirmed the certified statement through an 
examination of CBP data.\15\ We would then instruct CBP to liquidate 
any entries of merchandise produced by the respondent at the deposit 
rate in effect on the date of entry. However, in our May 6, 2003, 
``automatic assessment'' clarification, we explained that, where 
respondents in an administrative review demonstrated that they had no 
knowledge of sales through resellers to the United States, we would 
instruct CBP to liquidate such entries at the all-others rate 
applicable to the proceeding. See Antidumping and Countervailing Duty 
Proceedings: Assessment of Antidumping Duties, 68 FR 23954 (May 6, 
2003) (``Assessment Policy Notice''). Because ``as entered'' 
liquidation instructions do not alleviate the concerns which the 
Assessment Policy Notice was intended to address, instead of rescinding 
the review with respect to Botticelli and Fiamma, we find it 
appropriate to complete the review and issue liquidation instructions 
to CBP concerning entries for these companies following the final 
results of the review. If we continue to find that Botticelli and 
Fiamma had no reviewable transactions of subject merchandise in the 
final results, we will instruct CBP to liquidate any existing entries 
of merchandise produced by Botticelli and Fiamma but exported by other 
parties at the all-others rate.\16\
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    \15\ See 19 CFR 351.213(d)(3); see also Certain Large Diameter 
Carbon and Alloy Seamless Standard, Line, and Pressure Pipe (Over 
41/2 Inches) From Japan: Final Results of Antidumping Duty 
Administrative Review, 77 FR 27428, 27430 (May 10, 2012).
    \16\ See, e.g., Magnesium Metal From the Russian Federation: 
Preliminary Results of Antidumping Duty Administrative Review, 75 FR 
26922, 26923 (May 13, 2010), unchanged in Magnesium Metal From the 
Russian Federation: Final Results of Antidumping Duty Administrative 
Review, 75 FR 56989 (September 17, 2010).
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Targeted Dumping Allegations

    The petitioners note that they conducted their own targeted dumping 
analysis of Granoro's and Rummo's U.S. sales using the Department's 
targeted dumping methodology as applied in Steel Nails and modified in 
Wood Flooring.\17\ Based on their own analysis, the petitioners argue 
the Department should conduct a targeted dumping analysis and employ 
average-to-transaction comparisons without offsets should the 
Department find that the record supports its allegation of targeted 
dumping.\18\ Granoro and Rummo did not comment on the targeted dumping 
allegations submitted by the petitioners.
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    \17\ See The petitioners' Allegation of Targeted Dumping with 
respect to Granoro, dated April 20, 2012, at 1-8, and the 
petitioners' Allegation of Targeted Dumping with respect to Rummo, 
dated April 20, 2012, at 1-8, both (citing Certain Steel Nails from 
the People's Republic of China: Final Determination of Sales at Less 
Than Fair Value and Partial Affirmative Determination of Critical 
Circumstances, 73 FR 33,977 (June 16, 2008) (``Steel Nails''), and 
accompany Issues and Decision Memorandum at Comment 8; Multilayered 
Wood Flooring from the People's Republic of China: Final 
Determination of Sales at Less Than Fair Value, 76 FR 64318 (Oct. 
18, 2011) (``Wood Flooring''), and accompanying Issues and Decision 
Memorandum at Comment 4).
    \18\ See id. at 5-9 and 6-9, respectively.
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    For purposes of these preliminary results, the Department did not 
conduct a targeted dumping analysis. In calculating the preliminary 
weighted-average dumping margin, the Department applied the calculation 
methodology adopted in the Final Modification for Reviews.\19\ In 
particular, the Department compared monthly, weighted-average export 
prices with monthly, weighted-average normal values, and granted 
offsets for negative comparison results in the calculation of the 
weighted-average dumping margins.\20\ Application of this methodology 
in these preliminary results affords parties an opportunity to 
meaningfully comment on the Department's implementation of this 
recently adopted methodology in the context of this administrative 
review.
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    \19\ 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'').
    \20\ See id. at 8102.
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Scope of the Order

    Imports covered by this order are shipments of certain non-egg dry 
pasta in packages of five pounds four ounces or less, whether or not 
enriched or fortified or containing milk or other optional ingredients 
such as chopped vegetables, vegetable purees, milk, gluten, diastasis, 
vitamins, coloring and flavorings, and up to two percent egg white. The 
pasta covered by this scope is typically sold in the retail market, in 
fiberboard or cardboard cartons, or polyethylene or polypropylene bags 
of varying dimensions.
    Excluded from the scope of this order are refrigerated, frozen, or 
canned pastas, as well as all forms of egg pasta, with the exception of 
non-egg dry pasta containing up to two percent egg white. Also excluded 
are imports of organic pasta from Italy that are accompanied by the 
appropriate certificate issued by the Instituto Mediterraneo Di 
Certificazione, by QC&I International Services, by Ecocert Italia, by 
Consorzio per il Controllo dei Prodotti Biologici, by Associazione 
Italiana per l'Agricoltura Biologica, by Codex S.r.L., by Bioagricert 
S.r.L., or by Instituto per la Certificazione Etica e Ambientale. 
Effective July 1, 2008, gluten free pasta is also excluded from this 
order. See Certain Pasta from Italy: Notice of Final Results of 
Antidumping Duty Changed Circumstances Review and Revocation, in Part, 
74 FR 41120 (August 14, 2009).
    The merchandise subject to this order is currently classifiable 
under items 1902.19.20 and 1901.90.9095 of the Harmonized Tariff 
Schedule of the United States (``HTSUS''). Although the HTSUS 
subheadings are provided for convenience and customs purposes, the 
written description of the merchandise subject to the order is 
dispositive.

Notice of Intent To Revoke Order, in Part

    On July 29, 2011, Granoro requested revocation of the order on 
pasta from Italy as it pertains to its sales. Pursuant to section 
751(d)(1) of the Act, the Department ``may revoke, in whole or in 
part'' an antidumping duty order upon completion of a review. Although

[[Page 46380]]

Congress has not specified the procedures that the Department must 
follow in revoking an order, the Department has developed a procedure 
for revocation that is set forth at 19 CFR 351.222. Pursuant to 19 CFR 
351.222(b)(2), the Department may revoke an antidumping duty order in 
part if it concludes that (A) an exporter or producer has sold the 
merchandise at not less than normal value for a period of at least 
three consecutive years, (B) the exporter or producer has agreed in 
writing to its immediate reinstatement in the order if the Secretary 
concludes that the exporter or producer, subsequent to the revocation, 
sold the subject merchandise at less than normal value, and (C) the 
continued application of the antidumping duty order is no longer 
necessary to offset dumping. Section 351.222(b)(3) of the Department's 
regulations states that, in the case of an exporter that is not the 
producer of subject merchandise, the Department normally will revoke an 
order in part under 19 CFR 351.222(b)(2) only with respect to subject 
merchandise produced or supplied by those companies that supplied the 
exporter during the time period that formed the basis for revocation.
    A request for revocation of an order in part for a company 
previously found dumping must address three elements. The company 
requesting the revocation must do so in writing and submit the 
following statements with the request: (1) The company's certification 
that it sold the subject merchandise at not less than normal value 
during the current review period and that, in the future, it will not 
sell at less than normal value; (2) the company's certification that, 
during each of the consecutive years forming the basis of the request, 
it sold the subject merchandise to the United States in commercial 
quantities; (3) the agreement to reinstatement in the order if the 
Department concludes that, subsequent to revocation, the company has 
sold the subject merchandise at less than normal value. See 19 CFR 
351.222(e)(1). We preliminarily determine that the request dated July 
29, 2011, from Granoro meets all of the criteria under 19 CFR 
351.222(e)(1).
    With regard to the criteria of 19 CFR 351.222(b)(2), our 
preliminary margin calculations show that Granoro sold pasta at not 
less than normal value during the current review period. See 
``Preliminary Results of Reviews'' section below. In addition, it sold 
pasta at not less than normal value in the previous administrative 
review in which it was reviewed, including the intermediary period 
between the previous administrative review and this ongoing review. See 
Certain Pasta from Italy: Notice of Final Results of the Thirteenth 
Antidumping Duty Administrative Review, 75 FR 81212 (December 27, 
2010). Based on our examination of the sales data submitted by Granoro, 
we preliminarily determine that Granoro sold the subject merchandise in 
the United States in commercial quantities in each of the consecutive 
years cited by Granoro to support its request for revocation. See 
Granoro's Sales Verification Report, dated July 9, 2012, at Exhibit 
SVE-10. Thus, we preliminarily find that the Granoro sold pasta at not 
less than normal value for the last three consecutive years and sold in 
commercial quantities all three years. Also, we preliminarily determine 
that application of the antidumping duty order to Granoro is no longer 
warranted for the following reasons: (1) The company sold pasta at not 
less than normal value for a period of at least three consecutive 
years; (2) the company has agreed to immediate reinstatement of the 
order if we find that it has resumed making sales at less than fair 
value; (3) the continued application of the order is not otherwise 
necessary to offset dumping.
    Therefore, we preliminarily determine that Granoro qualifies for 
revocation from the order on pasta from Italy pursuant to 19 CFR 
351.222(b)(2) and, thus, we preliminarily determine to revoke the order 
with respect to pasta from Italy exported and/or sold to the United 
States by Granoro. If our intent to revoke results in revocation of the 
order in part with respect to merchandise exported and/or sold by 
Granoro, the proposed effective date of the revocation is July 1, 
2011.\21\
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    \21\ The Department amended its regulations concerning the 
revocation of antidumping and countervailing duty orders in whole or 
in part, and the termination of suspended antidumping and 
countervailing duty investigations. Specifically, the Department's 
Final Rule eliminates the provision for revocation of an antidumping 
or countervailing duty order with respect to individual exporters or 
producers based on those individual exporters or producers having 
received antidumping rates of zero for three consecutive years, or 
countervailing duty rates of zero for five consecutive years. This 
Final Rule will apply to all reviews that are initiated on or after 
June 20, 2012, however, this provision regarding revocation does not 
apply to Granoro because the instant review was initiated prior to 
the aforementioned date. See Modification to Regulation Concerning 
the Revocation of Antidumping and Countervailing Duty Orders, 77 FR 
29875 (May 21, 2012) (``Final Rule'').
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Product Comparisons

    In accordance with section 771(16) of the Tariff Act of 1930, as 
amended (the Act), we first attempted to match contemporaneous sales of 
products sold by Granoro and Rummo in the United States and comparison 
markets that were identical with respect to the following 
characteristics: (1) Pasta shape; (2) wheat species; (3) milling form; 
(4) protein content; (5) additives; and (6) enrichment. In this review, 
the respondents did not report the protein content as indicated on the 
packaging of the finished pasta, but instead reported based on their 
internal production records. Therefore, we clarified in a supplemental 
questionnaire to the respondents that they were expected to report the 
protein content based on the protein content indicated on the packaging 
of the finished product. In our calculations we used the protein 
content indicated on the packaging of the finished product, as reported 
by the respondents in their supplemental questionnaire responses. When 
there were no sales of identical merchandise in the comparison market 
to compare with U.S. sales, we compared U.S. sales with the most 
similar product based on the characteristics listed above, in 
descending order of priority. When there were no appropriate comparison 
market sales of comparable merchandise, we compared the merchandise 
sold in the United States to CV, in accordance with section 773(a)(4) 
of the Act.
    We made comparisons to weighted-average comparison market prices 
that were based on all sales which passed the cost-of-production test 
and on those sales which did not pass the cost-of-production test but 
were made at prices which were considered to have provided for the 
recovery of costs within a reasonable period of time. Specifically, in 
making our comparisons, if an identical home market model was reported, 
we made comparisons to monthly weighted-average home market prices that 
were based on all relevant sales during the contemporary month or, 
lacking such sales, to a previous or subsequent month in the shorter 
cost period (see ``Cost Averaging Methodology'' below). If there were 
no sales of an identical model available for comparison during the 
relevant months, we substituted the most similar above cost home market 
model. If there were no home market models with a difference in 
merchandise of less than twenty percent available, we used constructed 
value for comparison purposes. We calculated the weighted-average 
comparison market prices on a level of trade-specific basis.
    For purposes of the preliminary results, where appropriate, we have 
calculated the adjustment for differences in merchandise based on the 
difference in the variable cost of

[[Page 46381]]

manufacturing (``VCOM'') between each U.S. model and the most similar 
home market model selected for comparison.

Comparisons to Normal Value

    To determine whether sales of certain pasta from Italy were made in 
the United States at prices below NV, we compared the export price (EP) 
or constructed export price (CEP) to the NV, as described in the 
``Export Price and Constructed Export Price'' and ``Normal Value'' 
sections of this notice. Pursuant to 19 CFR 351.414(c)(1) and (d), we 
compared the monthly weighted-average export price of U.S. transactions 
to the monthly weighted-average normal value of the comparable foreign 
like product where there were sales made in the ordinary course of 
trade.\22\
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    \22\ 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 Assessment Rate in Certain Antidumping Duty Proceedings; 
Final Modification, 77 FR 8101 (February 14, 2012). In particular, 
the Department compared monthly weighted-average 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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Export Price and Constructed Export Price

    For the price to the United States, we used, as appropriate, EP or 
CEP, in accordance with sections 772(a) and (b) of the Act. Pursuant to 
section 772(a) of the Act, we used the EP methodology when the 
merchandise was first sold by the producer or exporter outside the 
United States directly to the unaffiliated purchaser in the United 
States prior to importation and when CEP was not otherwise warranted 
based on the facts on the record. We calculated CEP for those sales 
where a person in the United States, affiliated with the foreign 
exporter or acting for the account of the exporter, made the first sale 
to the unaffiliated purchaser in the United States of the subject 
merchandise. See section 772(b) of the Act. We based EP and CEP on the 
packed prices charged to the first unaffiliated customer in the United 
States and the applicable terms of sale. When appropriate, we adjusted 
prices to reflect billing adjustments, rebates, and early payment 
discounts, quantity discounts, expenses recovered from customers, and 
commissions. In accordance with section 772(c)(2) of the Act, we made 
deductions, where appropriate, for movement expenses including movement 
expenses incurred at the production facility, U.S. warehouse expense, 
inland freight, inland insurance, brokerage & handling, international 
freight, marine insurance, freight rebate revenue, and U.S. customs 
duties. With respect to Granoro, we capped the transportation recovery 
amounts by the amount of U.S. freight expenses, incurred on the subject 
merchandise, in accordance with our practice. See Certain Orange Juice 
from Brazil: Final Results and Partial Rescission of Antidumping Duty 
Administrative Review, 73 FR 46584 (August 11, 2008), and accompanying 
Issues and Decision Memorandum (``2005-2007 OJ from Brazil'') at 
Comment 7.
    In addition, when appropriate, we increased EP by an amount equal 
to the countervailing duty (``CVD'') rate attributed to export 
subsidies in the most recently completed CVD administrative review, in 
accordance with section 772(c)(1)(C) of the Act. For CEP, in accordance 
with section 772(d)(1) of the Act, when appropriate, we deducted from 
the starting price those selling expenses that were incurred in selling 
the subject merchandise in the United States, including direct selling 
expenses (cost of credit, warranty, and other direct selling expenses). 
These expenses also include certain indirect selling expenses incurred 
by unaffiliated U.S. commission agents.\23\
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    \23\ See Memorandum from Dennis McClure to James Terpstra, 
Program Manager, entitled ``Sales Analysis Memorandum for the 
Preliminary Results--Granoro'' (Preliminary Results Sales Analysis 
Memo--Granoro), dated concurrently with this notice; see also 
Memorandum from George McMahon to James Terpstra, Program Manager, 
entitled ``Sales Analysis Memorandum for the Preliminary Results--
Rummo'' (Preliminary Results Sales Analysis Memo--Rummo), dated 
concurrently with this notice.
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Normal Value

A. Selection of Comparison Markets

    Section 773(a)(1) of the Act directs that NV be based on the price 
of the foreign like product sold in the home market, provided that the 
merchandise is sold in sufficient quantities (or value, if quantity is 
inappropriate) and that there is no particular market situation that 
prevents a proper comparison with the export price or constructed 
export price. The statute contemplates that quantities (or value) 
normally be considered insufficient if they are less than five percent 
of the aggregate quantity (or value) of sales of the subject 
merchandise to the United States. To determine whether there was a 
sufficient volume of sales in the home market to serve as a viable 
basis for calculating NV, we compared each respondent's volume of home 
market sales of the foreign like product to the volume of its U.S. 
sales of the subject merchandise. Pursuant to section 773(a)(1)(B) of 
the Act, because Granoro and Rummo each had an aggregate volume of home 
market sales of the foreign like product that was greater than five 
percent of its aggregate volume of U.S. sales of the subject 
merchandise, we determined that the home market was viable for both 
Granoro and Rummo.

B. Arm's-Length Sales

    Granoro reported that all of its sales to the Italian market are to 
unaffiliated customers; however, it made a few sales to employees and 
shareholders and coded such sales as affiliated sales. See Granoro's 
section B questionnaire response, dated November 22, 2011. In 
accordance with the Department's practice, we have excluded such sales 
from consideration when the sales did not pass our Arm's Length Test. 
See Preliminary Results Sales Analysis Memo--Granoro. Rummo reported 
that all of its sales to the Italian market are to unaffiliated 
customers.\24\ In addition, Pasta Castiglione (``PC''), Rummo's 
affiliated producer, reported that it did not make any sales to 
affiliates in the foreign market.\25\ Therefore, we did not apply the 
arm's length test with respect to Rummo's sales.
---------------------------------------------------------------------------

    \24\ See Rummo's Section B Questionnaire Response, dated 
December 12, 2011, at page B-9.
    \25\ See PC's Section A Questionnaire Response, dated December 
5, 2011 at A-24.
---------------------------------------------------------------------------

C. Cost of Production Analysis

    In the most recently completed segment of the proceeding in which 
Granoro and Rummo participated, the Department determined that the 
aforementioned respondents sold the foreign like product at prices 
below the cost of producing the merchandise and, as a result, we 
excluded such sales from the calculation of normal value.\26\ 
Therefore, pursuant to section 773(b)(2)(A)(ii) of the Act, there are 
reasonable grounds to believe or suspect that Granoro and Rummo's sales 
of the foreign like product under consideration for the determination 
of normal value in the instant review may have been made at prices 
below the COP as provided by section 773(b)(2)(A)(ii) of the Act and, 
therefore, outside of the ordinary course of trade. Pursuant to section 
773(b)(1) of the Act, we have conducted a COP investigation of Granoro 
and Rummo's

[[Page 46382]]

sales in the comparison market (sales below cost test) and required 
Granoro and Rummo to submit a response to Section D of the Department's 
questionnaire.
---------------------------------------------------------------------------

    \26\ See Certain Pasta From Italy: Notice of Amended Final 
Results of the Thirteenth Antidumping Duty Administrative Review, 76 
FR 6601 (February 7, 2011) (Pasta Thirteenth Review); see also 
Certain Pasta from Italy: Notice of Final Results of the Tenth 
Administrative Review and Partial Rescission of Review, 72 FR 70298 
(December 11, 2007) (``Pasta Tenth Review'').
---------------------------------------------------------------------------

1. Cost Averaging Methodology
    The Department's normal practice is to calculate an annual 
weighted-average cost for the POR.\27\ However, we recognize that 
possible distortions may result if we use our normal annual-average 
cost method during a time of significant cost changes. In determining 
whether to deviate from our normal methodology of calculating an annual 
weighted-average cost, we evaluate the case-specific record evidence 
using two primary factors: (1) The change in the cost of manufacturing 
(``COM'') recognized by the respondent during the POR must be deemed 
significant; (2) the record evidence must indicate that sales during 
the shorter cost-averaging periods could be reasonably linked with the 
COP or constructed value during the same shorter cost-averaging 
periods.\28\
---------------------------------------------------------------------------

    \27\ See Certain Pasta From Italy: Final Results of Antidumping 
Duty Administrative Review, 65 FR 77852 (December 13, 2000), and 
accompanying Issues and Decision Memorandum at Comment 18, and 
Notice of Final Results of Antidumping Duty Administrative Review: 
Carbon and Certain Alloy Steel Wire Rod from Canada, 71 FR 3822 
(January 24, 2006), and accompanying Issues and Decision Memorandum 
at Comment 5 (explaining the Department's practice of computing a 
single weighted-average cost for the entire period).
    \28\ See Stainless Steel Sheet and Strip in Coils From Mexico: 
Final Results of Antidumping Duty Administrative Review, 75 FR 6627 
(February 10, 2010) (``SSSS from Mexico''), and accompanying Issues 
and Decision Memorandum at Comment 6 and Stainless Steel Plate in 
Coils From Belgium: Final Results of Antidumping Duty Administrative 
Review, 73 FR 75398 (December 11, 2008) (``SSPC from Belgium''), and 
accompanying Issues and Decision Memorandum at Comment 4.
---------------------------------------------------------------------------

a. Significance of Cost Changes

    In prior cases, we established 25 percent as the threshold (between 
the high- and low- quarter COM) for determining that the changes in COM 
are significant enough to warrant a departure from our standard annual-
average cost approach.\29\ In the instant case, record evidence shows 
that Granoro and Rummo experienced significant changes (i.e., changes 
that exceeded 25 percent) between the high and low quarterly COM during 
the POR.\30\ This change in COM is attributable primarily to the price 
volatility for semolina used in the production of pasta. Id.
---------------------------------------------------------------------------

    \29\ See SSPC from Belgium, and accompanying Issues and Decision 
Memorandum at Comment 4.
    \30\ See Memorandum from Sheikh Hannan to Neal M. Halper, 
Director of Office of Accounting, entitled ``Cost of Production and 
Constructed Value Calculation Adjustments for the Preliminary 
Results--Granoro'' (``Granoro Cost Calculation Memo''), dated 
concurrently with this notice at 2; see also Memorandum from Heidi 
Schriefer to Neal M. Halper, Director of Office of Accounting, 
entitled ``Cost of Production and Constructed Value Calculation 
Adjustments for the Preliminary Results--the Rummo Group'' (``Rummo 
Cost Calculation Memo''), dated concurrently with this notice at 2.
---------------------------------------------------------------------------

    b. Linkage Between Cost and Sales Information
    Consistent with past precedent, because we found the changes in 
costs to be significant, we evaluated whether there is evidence of a 
linkage between the cost changes and the sales prices during the 
POR.\31\ Absent a surcharge or other pricing mechanism, the Department 
may alternatively look for evidence of a pattern that changes in 
selling prices reasonably correlate to changes in unit costs.\32\ To 
determine whether a reasonable correlation existed between the sales 
prices and underlying costs during the POR, we compared weighted-
average quarterly prices to the corresponding quarterly COM for the 
control numbers with the highest volume of sales in the comparison 
market and in the United States. Our comparison revealed that sales and 
costs for Granoro and Rummo showed reasonable correlation. See Granoro 
Cost Calculation Memo at pages 2-3 and Rummo Cost Calculation Memo at 
pages 2-3. After reviewing this information and determining that 
changes in selling prices correlate reasonably to changes in unit 
costs, we preliminarily determine that there is linkage between 
Granoro's and Rummo's changing sales prices and costs during the 
POR.\33\ We have preliminarily determined that a shorter cost period 
approach, based on a quarterly-average COP, is appropriate for Granoro 
and Rummo because we have found significant cost changes in COM as well 
as reasonable linkage between costs and sales prices.
---------------------------------------------------------------------------

    \31\ See SSSS from Mexico, and accompanying Issues and Decision 
Memorandum at Comment 6 and SSPC from Belgium, and accompanying 
Issues and Decision Memorandum at Comment 4.
    \32\ See SSPC from Belgium, and accompanying Issues and Decision 
Memorandum at Comment 4.
    \33\ Id.; see also SSSS from Mexico, and accompanying Issues and 
Decision Memorandum at Comment 6 and SSPC from Belgium, and 
accompanying Issues and Decision Memorandum at Comment 4.
---------------------------------------------------------------------------

2. Calculation of Cost of Production
    Before making comparisons to normal value, we conducted a COP 
analysis of Granoro's and Rummo's sales pursuant to section 773(b)(3) 
of the Act to determine whether home market sales were made at prices 
below COP and that these costs were not recoverable within a reasonable 
period of time. For this analysis, the COP is based on a quarterly 
average COP rather than an annual average COP. See the ``Cost Averaging 
Methodology'' section, above, for further discussion. We calculated 
Granoro's and Rummo's quarterly COP on a product-specific basis, based 
on the sum of the Granoro's and Rummo's respective cost of materials 
and fabrication for the foreign like product, plus amounts for general 
and administrative expenses, interest expenses, and the costs of all 
expenses incidental to packing the merchandise. We relied on the COP 
information submitted by both Granoro and Rummo except the following 
adjustments. With respect to Granoro, we corrected several errors noted 
during the cost verification, revised the reported semolina costs to 
differentiate for the protein content (the Department's fourth physical 
product characteristic), and we weight-averaged the per-unit costs for 
certain control numbers (CONNUMs). For further discussion of these 
adjustments, see Granoro Cost Calculation Memo. With respect to Rummo, 
we have revised Rummo's and Pasta Castiglioni's reported protein-
specific quarterly semolina costs to correct errors discovered in the 
calculation of the quarterly average semolina purchase prices. We have 
also revised the semolina calculations to express and apply yield 
losses as a percentage rather than as a nominal value. We then 
calculated and applied a POR scrap offset for each company. See Rummo 
Cost Calculation Memo at 4-5. For control numbers for which there was 
no production during the POR or during a POR quarter we chose or 
calculated surrogates respectively.\34\
---------------------------------------------------------------------------

    \34\ See Preliminary Sales Analysis Memorandum--Granoro and 
Preliminary Sales Analysis Memorandum--Rummo.
---------------------------------------------------------------------------

4. Cost Recovery Analysis
    In accordance with sections 773(b)(1)(A) and (B) of the Act, for 
sales found to be made below cost, we examined whether, within an 
extended period of time, such sales were made in substantial 
quantities, and whether such sales were made at prices which permitted 
the recovery of all costs within a reasonable period of time in the 
normal course of trade. As stated in section 773(b)(2)(D) of the Act, 
prices are considered to provide for recovery of costs if such prices 
are above the weighted average per-unit COP for the period of 
investigation or review.
    In light of the Court's directives in SeAH Steel Corp. v. United 
States, 704 F. Supp. 2d 1353 (Ct. Int'l Trade 2010), and SeAH Steel 
Corporation v. United States, 764 F. Supp. 2d 1322 (Ct. Int'l. Trade 
2011) to use an unadjusted

[[Page 46383]]

annual average cost for purposes of the cost recovery test, in the 
instant review we have used the approach to test for cost recovery when 
using a shorter cost period methodology.\35\ Using the methodology 
adopted in SPT from Turkey, we calculated a control number specific 
weighted-average annual price using only those sales that were made 
below their quarterly COP, and compared the resulting weighted-average 
price to the annual weighted-average cost per control number. If the 
annual weighted-average price per control number was above the annual 
weighted-average cost per control number then we considered those sales 
to have provided for the recovery of costs and restored all such sales 
to the normal value pool of comparison-market sales available for 
comparison with U.S. sales. For further details regarding the cost 
recovery methodology and the application of our shorter-cost period 
methodology, see the Granoro Cost Calculation Memo at 1-2; see also the 
Rummo Cost Calculation Memo at 1-2.
---------------------------------------------------------------------------

    \35\ See Certain Welded Carbon Steel Pipe and Tube From Turkey; 
Notice of Final Results of Antidumping Duty Administrative Review, 
76 FR 76939 (December 9, 2011) (``SPT From Turkey'').
---------------------------------------------------------------------------

5. Results of the Sales Below Cost Test
    We found that for certain products, more than 20 percent of 
Granoro's and Rummo's home market sales were made at prices below COP 
and, in addition, these below cost sales were made within an extended 
period of time and in substantial quantities. In addition, pursuant to 
the cost recovery analysis described above, we found that these sales 
were at prices which did not permit the recovery of costs within a 
reasonable period of time. Therefore, we disregarded these sales from 
the calculation of normal value, in accordance with section 773(b)(1) 
of the Act.

D. Calculation of Normal Value Based on Comparison Market Prices

    We calculated NV based on ex-works, free on board (``FOB'') or 
delivered prices to comparison market customers. We made deductions 
from the starting price, when appropriate, for discounts and rebates. 
We added expenses recovered from customers. We deducted home market 
packing costs and added U.S. packing costs, in accordance with sections 
773(a)(6)(A) and (B) of the Act. We also deducted home market movement 
expenses pursuant to section 773(a)(6)(B) of the Act. In addition, we 
made adjustments for differences in circumstances of sale (``COS'') 
pursuant to section 773(a)(6)(C)(iii) of the Act. Specifically, we made 
adjustments to normal value for comparison to Granoro's and Rummo's EP 
transactions by deducting direct selling expenses incurred for home 
market sales (i.e., credit expenses) and adding U.S. direct selling 
expenses (i.e., credit expenses) and U.S. commissions. See section 
773(a)(6)(C)(iii) of the Act, and 19 CFR 351.410(c). We also made 
adjustments for Granoro and Rummo, in accordance with 19 CFR 
351.410(e), for indirect selling expenses incurred in the home market 
or the United States where commissions were granted on sales in one 
market but not in the other, the ``commission offset.'' Specifically, 
where commissions are incurred in one market, but not in the other, we 
will limit the amount of such allowance to the amount of either the 
selling expenses incurred in the one market or the commissions allowed 
in the other market, whichever is less.
    When comparing U.S. sales with comparison market sales of similar, 
but not identical, merchandise, we also made adjustments for physical 
differences in the merchandise in accordance with section 
773(a)(6)(C)(ii) of the Act and 19 CFR 351.411. We based this 
adjustment on the difference in the VCOM for the foreign like product 
and subject merchandise, using weighted-average costs.
    Sales of pasta purchased by Granoro and Rummo from unaffiliated 
producers and resold in the comparison market were disregarded. See 
Preliminary Results Sales Analysis Memo--Granoro and Preliminary 
Results Sales Analysis Memo--Rummo.

E. Level of Trade

    In accordance with section 773(a)(1)(B) of the Act, we determine NV 
based on sales in the comparison market at the same level of trade 
(``LOT'') as the EP and CEP sales, to the extent practicable. When 
there are no sales at the same LOT, we compare U.S. sales to comparison 
market sales at a different LOT. When NV is based on CV, the NV LOT is 
that of the sales from which we derive SG&A expenses and profit.
    Pursuant to 19 CFR 351.412(c)(2), to determine whether comparison 
market sales were at a different LOT, we examine stages in the 
marketing process and selling functions along the chain of distribution 
between the producer and the unaffiliated (or arm's-length affiliated) 
customers. The Department identifies the LOT based on: The starting 
price or constructed value (for normal value); the starting price (for 
EP sales); and the starting price, as adjusted under section 772(d) of 
the Act (for CEP sales). If the comparison-market sales were at a 
different LOT and the differences affect price comparability, as 
manifested in a pattern of consistent price differences between the 
sales on which NV is based and comparison-market sales at the LOT of 
the export transaction, we will make an LOT adjustment under section 
773(a)(7)(A) of the Act.
    Finally, if the NV LOT is more remote from the factory than the CEP 
LOT and there is no basis for determining whether the differences in 
LOT between NV and CEP affected price comparability, we will grant a 
CEP offset, as provided in section 773(a)(7)(B) of the Act. See Notice 
of Final Determination of Sales at Less Than Fair Value: Certain Cut-
to-Length Carbon Steel Plate from South Africa, 62 FR 61731, 61732-33 
(November 19, 1997).
    Granoro indicated there was a single level of trade for all sales 
in both markets, and petitioners have not claimed that multiple levels 
of trade existed for Granoro. Granoro provided information regarding 
channels of distribution and selling activities performed for different 
categories of customers. See Granoro's November 22, 2011, section A 
response, at Exhibit 3. Granoro's chart of specific selling functions 
indicates the selling functions performed for sales in both markets are 
virtually identical, with no significant variation across the broader 
categories of sales process/marketing support, freight and delivery, 
inventory and warehousing, and quality assurance/warranty services. For 
more details, see Preliminary Results Analysis Memorandum--Granoro. We 
have preliminarily determined there is one single level of trade for 
all sales in both the home market and the U.S. market and, therefore, 
that no basis exists for a level of trade adjustment.
    Rummo reported that there was a single level of trade for its sales 
in the home market and claimed two levels of trade in the U.S. market. 
Rummo provided information regarding channels of distribution and 
selling activities performed for different categories of customers.\36\ 
Rummo's and PC's \37\ charts of specific selling functions indicate the 
selling functions performed for sales in both markets and demonstrates 
that there are significantly greater sales activities performed in the 
home market as compared to Rummo's

[[Page 46384]]

U.S. sales. We have preliminarily determined that these differences 
support a finding that the home market sales are made at a different 
and more advanced stage of marketing than the level of trade of Rummo's 
CEP sales. Accordingly, we have made a CEP offset to NV pursuant to 
section 773(a)(7)(B) of the Act.\38\
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    \36\ See Rummo's and PC's December 5, 2011, section A response, 
at Exhibits A-3 and A-4.
    \37\ See PC's March 8, 2012 Supplemental response at page 33.
    \38\ The Department made a CEP offset to NV for Rummo in the 
most recent administrative review (2005-2006) in which Rummo was a 
mandatory respondent. See Certain Pasta from Italy; Notice of 
Preliminary Results and Partial Rescission of Tenth Antidumping Duty 
Administrative Review, 72 FR 44082 (August 7, 2007).
---------------------------------------------------------------------------

    For a detailed description of our LOT methodology and a summary of 
company-specific LOT findings for these preliminary results, see our 
analysis contained in Preliminary Results Sales Analysis Memo--Granoro 
and Preliminary Results Sales Analysis Memo--Rummo.

Currency Conversion

    For purposes of these preliminary results, we made currency 
conversions in accordance with section 773A(a) of the Act, based on the 
official exchange rates published by the Federal Reserve Bank. See 
Preliminary Results Sales Analysis Memo--Granoro and Preliminary 
Results Sales Analysis Memo--Rummo.

Preliminary Results of Review

    As a result of our review, we preliminarily determine that the 
following weighted-average percentage margins exist for the period July 
1, 2010, through June 30, 2011:

------------------------------------------------------------------------
                                                               Margin
                   Manufacturer/exporter                      (percent)
                                                                \39\
------------------------------------------------------------------------
Granoro...................................................          0.00
Rummo.....................................................          6.97
Review-Specific Average Rate \40\.........................
Applicable to the Following Companies: Filiberto,                  6.97
 Fratelli, and Zaffiri....................................
------------------------------------------------------------------------
\39\ The antidumping duty margins for Granoro and Rummo include an
  adjustment for the countervailing duty offset to account for the
  export subsidy portion of the countervailing duties applied to these
  companies, as defined in the field CVDU.
\40\ This rate is a weight-average percentage margin calculated based on
  the two companies that were selected for individual review, excluding
  de minimis margins or margins based entirely on adverse facts
  available.

Public Comment

    The Department intends to disclose the calculations performed for 
these preliminary results within five days of the date of publication 
of this notice to the parties of this proceeding, in accordance with 19 
CFR 351.224(b). An interested party may request a hearing within 30 
days of publication of this notice in the Federal Register. See 19 CFR 
351.310(c). If a hearing is requested, the Department will notify 
interested parties of the hearing schedule.
    Interested parties are invited to comment on the preliminary 
results of this review. Interested parties may submit case briefs 
within 30 days of the date of publication of this notice. Rebuttal 
briefs, which must be limited to issues raised in the case briefs, may 
be filed not later than 35 days after the date of publication of this 
notice. Parties who submit case briefs or rebuttal briefs in this 
review are requested to submit with each argument (1) a statement of 
the issue and (2) a brief summary of the argument with an electronic 
version included.
    Pursuant to 19 CFR 351.213(h), the Department intends to issue the 
final results of this review, including the results of our analysis of 
issues raised in any submitted written comments, within 120 days after 
publication of this notice.

Assessment Rate

    Pursuant to 19 CFR 351.212(b), the Department calculated an 
assessment rate for each importer of the subject merchandise. Upon 
issuance of the final results of this administrative review, if any 
importer-specific assessment rates calculated in the final results are 
above de minimis (i.e., at or above 0.5 percent), the Department will 
issue appraisement instructions directly to CBP to assess antidumping 
duties on appropriate entries by applying the assessment rate to the 
entered value of the merchandise. Pursuant to the Final Modification 
for Reviews, ``when a review is conducted applying the A-A {(average-
to-average){time}  comparison methodology, and the weighted-average 
margin of dumping for the exporter or producer is determined to be zero 
or de minimis, no assessment rates will be calculated and the 
Department will instruct CBP to liquidate all imports from the exporter 
or producer without regard to antidumping duties, regardless of 
importer.'' \41\ For assessment purposes, we calculated importer-
specific assessment rates for the subject merchandise by aggregating 
the dumping margins for all U.S. sales to each importer and dividing 
the amount by the total entered value of the sales to that importer. 
Where appropriate, to calculate the entered value, we subtracted 
international movement expenses (e.g., international freight) from the 
gross sales value.
---------------------------------------------------------------------------

    \41\ See Final Modification for Reviews, 77 FR at 8107.
---------------------------------------------------------------------------

    The Department clarified its ``automatic assessment'' regulation on 
May 6, 2003 (68 FR 23954). This clarification will apply to entries of 
subject merchandise during the POR produced by companies included in 
these preliminary results of review for which the reviewed companies 
did not know their merchandise was destined for the United States. In 
such instances, we will instruct CBP to liquidate unreviewed entries at 
the all-others rate if there is no rate for the intermediate 
company(ies) involved in the transaction. For a full discussion of this 
clarification, see Antidumping and Countervailing Duty Proceedings: 
Assessment of Antidumping Duties, 68 FR 23954 (May 6, 2003).

Cash Deposit Requirements

    To calculate the cash deposit rate, we divided the total dumping 
margin by the total net value of the sales during the review period. 
The following deposit rates will be effective upon publication of the 
final results of this administrative review for all shipments of pasta 
from Italy entered, or withdrawn from warehouse, for consumption on or 
after the publication date, as provided by section 751(a)(2)(C) of the 
Act: (1) The cash deposit rate for companies subject to this review 
will be the rate established in the final results of this review, 
except if the rate is less than 0.5 percent and, therefore, de minimis, 
no cash deposit will be required; (2) for previously reviewed or 
investigated companies not listed above, the cash deposit rate will 
continue to be the company-specific rate published for the most recent 
final results for a review in which that manufacturer or exporter 
participated; (3) if the exporter is not a firm covered in this review, 
a prior review, or the original less-than-fair-value (``LTFV'') 
investigation, but the manufacturer is, the cash deposit rate will be 
the rate established for the most recent final results for the 
manufacturer of the merchandise; and (4) if neither the exporter nor 
the manufacturer is a firm covered in this or any previous review 
conducted by the Department, the cash deposit rate will be 15.45 
percent, the all-others rate established in the LTFV investigation. See 
Implementation of the Findings of the WTO Panel in US--Zeroing (EC): 
Notice of Determination Under Section 129 of the Uruguay Round 
Agreements Act and Revocations and Partial Revocations of Certain 
Antidumping Duty Orders, 72 FR 25261 (May 4, 2007). These cash deposit 
requirements, when imposed,

[[Page 46385]]

shall remain in effect until further notice.

Notification to Importers

    This notice serves as a preliminary reminder to importers of their 
responsibility under 19 CFR 351.402(f) 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 increase the 
subsequent assessment of the antidumping duties by the amount of 
antidumping duties reimbursed.
    These preliminary results of administrative review are issued and 
published in accordance with sections 751(a)(1) and 777(i)(1) of the 
Act and 19 CFR 351.221(b)(4).

    Dated: July 27, 2012.
Paul Piquado,
Assistant Secretary for Import Administration.
[FR Doc. 2012-19057 Filed 8-2-12; 8:45 am]
BILLING CODE 3510-DS-P