[Federal Register Volume 75, Number 93 (Friday, May 14, 2010)]
[Notices]
[Pages 27302-27308]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-11605]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-898]


Chlorinated Isocyanurates From the People's Republic of China: 
Preliminary Results and Partial Rescission of Antidumping Duty 
Administrative Review

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

SUMMARY: In response to requests from interested parties, the 
Department of Commerce (``the Department'') is conducting an 
administrative review of the antidumping duty order on chlorinated 
isocyanurates (``chlorinated isos'') from the People's Republic of 
China (``PRC''). The period of review (``POR'') for this administrative 
review is June 1, 2008, through May 31, 2009. Because the Department is 
rescinding the review of Zhucheng Taisheng Chemical Co., Ltd. 
(``Zhucheng''), this administrative review only covers one producer/
exporter of the subject merchandise, i.e., Hebei Jiheng Chemical Co., 
Ltd. (``Jiheng'').
    We preliminarily determine that Jiheng made sales in the United 
States at prices below normal value (``NV''). If these preliminary 
results are adopted in

[[Page 27303]]

our final results of review, we will instruct U.S. Customs and Border 
Protection (``CBP'') to assess antidumping duties on entries of subject 
merchandise during the POR for which the importer-specific assessment 
rates are above de minimis. We invite interested parties to comment on 
these preliminary results.

DATES: Effective Date: May 14, 2010.

FOR FURTHER INFORMATION CONTACT: Brandon Petelin or Charles Riggle, AD/
CVD Operations, Office 8, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
8173 or (202) 482-0650, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On June 24, 2005, the Department published in the Federal Register 
the antidumping duty order on chlorinated isos from the PRC.\1\ On June 
1, 2009, the Department published in the Federal Register a notice of 
opportunity to request an administrative review of the antidumping duty 
order on chlorinated isos from the PRC for the period June 1, 2008, 
through May 31, 2009.\2\ On June 29, 2009, in accordance with 19 CFR 
351.213(b)(2), Zhucheng, a foreign producer/exporter of subject 
merchandise, requested that the Department review its sales of subject 
merchandise. On June 30, 2009, in accordance with 19 CFR 351.213(b)(2), 
Jiheng, a foreign producer/exporter of subject merchandise, requested 
that the Department review its sales of subject merchandise.
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    \1\ See Notice of Antidumping Duty Order: Chlorinated 
Isocyanurates From the People's Republic of China, 70 FR 36561 (June 
24, 2005).
    \2\ See Antidumping or Countervailing Duty Order, Finding, or 
Suspended Investigation; Opportunity to Request Administrative 
Review, 74 FR 26202 (June 1, 2009).
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    On July 29, 2009, the Department initiated the administrative 
review of the antidumping duty order on chlorinated isos from the PRC 
covering the period June 1, 2008, through May 31, 2009.\3\ On August 4, 
2009, the Department issued its antidumping duty questionnaire to both 
Jiheng and Zhucheng. However, on October 7, 2009, because the 
Department determined that Zhucheng did not have standing to request an 
administrative review, the Department issued a Federal Register Notice 
stating that it intended to rescind the administrative review with 
respect to Zhucheng.\4\ On August 17, 2009, Clearon Corporation and 
Occidental Chemical Corporation, domestic producers of chlorinated isos 
(collectively ``Petitioners''), submitted an entry of appearance in the 
underlying administrative review.
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    \3\ See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Deferral of Administrative Review 74 FR 
37690 (July 29, 2009) (``Initiation Notice'').
    \4\ See Chlorinated Isocyanurates from the People's Republic of 
China, Notice of Intent to Partially Rescind Administrative Review, 
74 FR 51557 (October 7, 2009).
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    On September 8, 2009, Jiheng submitted its section A questionnaire 
response (``AQR''). On September 23, 2009, Jiheng submitted its 
sections C and D questionnaire responses (``CQR and DQR'', 
respectively). On December 16, 2009, the Department issued a 
supplemental questionnaire to Jiheng. On January 7, 2010, Jiheng 
submitted its supplemental questionnaire response (``1st SQR''). On 
March 16, 2010, the Department issued a second supplemental 
questionnaire to Jiheng. On March 26, 2010, Jiheng submitted its second 
supplemental questionnaire response (``2nd SQR'').
    On January 5, 2010, the Department requested that the Office of 
Policy provide a list of surrogate countries for this review, which it 
did on January 25, 2010.\5\ On January 26, 2010, the Department issued 
a letter to interested parties seeking comments on surrogate country 
selection and surrogate values. On February 12, 2010, in the memorandum 
regarding ``Tolling of Administrative Deadlines as a Result of the 
Government Closure During the Recent Snowstorm'' from the Deputy 
Assistant Secretary for Import Administration, dated February 12, 2010, 
the Department exercised its discretion to toll deadlines for the 
duration of the partial shutdown of the Federal Government from 
February 5 through February 11, 2010.\6\ Thus, all deadlines in this 
segment of the proceeding were extended by 7 days.
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    \5\ See Memorandum regarding: Request for Surrogate-Country 
Selection: 2008-2009 Administrative Review of the Antidumping Duty 
Order on Chlorinated Isocyanurates from the People's Republic of 
China, dated January 5, 2010; see also Memorandum regarding: Request 
for a List of Surrogate Countries for an Administrative Review of 
the Antidumping Duty Order on Chlorinated Isocyanurates from the 
People's Republic of China, dated January 25, 2010 (``Surrogate 
Country List'').
    \6\ See Memorandum regarding: Tolling of Administrative 
Deadlines as a Result of the Government Closure During the Recent 
Snow Storm, dated February 12, 2010.
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    On February 12, 2010, Jiheng submitted comments regarding the 
selection of a surrogate country. On February 16, 2010, Jiheng 
submitted publicly available information in order to value Jiheng's 
factors of production (``FOPs''). Also, on February 16, 2010, Arch 
Chemicals, Inc. (``Arch''), a United States importer of subject 
merchandise from Jiheng, submitted surrogate value information from 
Chemical Weekly for certain chemicals used in Jiheng's production of 
the subject merchandise. On February 23, 2010, Petitioners submitted 
publicly available information to value certain FOPs. On March 1, 2010, 
the Department published a notice in the Federal Register extending the 
time limit for the preliminary results of review until May 10, 2010.\7\
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    \7\ See Chlorinated Isocyanurates From the People's Republic of 
China: Notice of Extension of Time Limit for the Preliminary Results 
of the Antidumping Duty Administration Review, 75 FR 9160 (March 1, 
2010).
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Scope of the Order

    The products covered by this order are chlorinated isos, which are 
derivatives of cyanuric acid, described as chlorinated s-triazine 
triones. There are three primary chemical compositions of chlorinated 
isos: (1) Trichloroisocyanuric acid (Cl3(NCO)3), 
(2) sodium dichloroisocyanurate (dihydrate) 
(NaCl2(NCO)3(2H2O)), and (3) sodium 
dichloroisocyanurate (anhydrous) (NaCl2(NCO)3). 
Chlorinated isos are available in powder, granular, and tableted forms. 
This order covers all chlorinated isos. Chlorinated isos are currently 
classifiable under subheadings 2933.69.6015, 2933.69.6021, 
2933.69.6050, 3808.40.50, 3808.50.40 and 3808.94.50.00 of the 
Harmonized Tariff Schedule of the United States (``HTSUS''). The tariff 
classification 2933.69.6015 covers sodium dichloroisocyanurates 
(anhydrous and dihydrate forms) and trichloroisocyanuric acid. The 
tariff classifications 2933.69.6021 and 2933.69.6050 represent basket 
categories that include chlorinated isos and other compounds including 
an unfused triazine ring. Although the HTSUS subheadings are provided 
for convenience and customs purposes, the written description of the 
scope of this order is dispositive.
    On April 9, 2008, the Department issued a final scope ruling 
stating that Chinese-origin chlorinated isos imported into Canada from 
the PRC by Capo Industries, Ltd., which are then processed and exported 
by Capo to the United States, are within the scope of the antidumping 
duty order covering chlorinated isos from the PRC. The Department found 
that Capo's processing in Canada is essentially a repackaging operation 
with respect to Chinese-origin product and does not substantially 
transform the chlorinated isos imported from the PRC by Capo.

[[Page 27304]]

    On March 23, 2009, the Department issued a final scope ruling 
stating that chlorinated isos produced and exported from Vietnam by 
Tian Hua (Vietnam) SPC Industries Ltd. are not within the scope of the 
antidumping duty order covering chlorinated isos from the PRC because 
Tian Hua demonstrated on the record of the scope inquiry that it 
produces chlorinated isos in its production facilities in Vietnam.

Partial Rescission of Review

    The Department is hereby rescinding the administrative review with 
respect to Zhucheng, covering the period of June 1, 2008, through May 
31, 2009. The Department's regulations at 19 CFR 351.213(b)(2) state 
that an exporter or producer covered by an antidumping order may 
request that the Department conduct an administrative review of only 
that party during the anniversary month of the publication of an 
antidumping order. On June 29, 2009, pursuant to 19 CFR 351.213(b)(2), 
Zhucheng submitted a timely request for an administrative review of the 
antidumping duty order on chlorinated isos from the PRC purporting to 
be a producer and exporter of subject merchandise. In a letter dated 
August 24, 2009, however, Zhucheng explained that, in the process of 
preparing its section A questionnaire response for this review, it 
discovered that the actual producer and exporter of the subject 
merchandise was Zhucheng Taisheng Angmu Chemical Co., Ltd., with whom 
Zhucheng claims to be affiliated.\8\ Therefore, because Zhucheng 
requested a review as a producer/exporter but was neither a producer 
nor an exporter of the subject merchandise during the POR, Zhucheng is 
not entitled to request an administrative review pursuant to 19 CFR 
351.213(b)(2).
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    \8\ See Letter from Zhucheng Taisheng, ``Chlorinated 
Isocyanurates from China; Inquiry Regarding Status of Administrative 
Review'' (August 24, 2009) (``Inquiry Regarding Status of 
Administrative Review'').
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    Because Zhucheng did not have standing to request an administrative 
review, the Department previously issued a Federal Register Notice of 
its intent to partially rescind the review with respect to Zhucheng, as 
the Department had initiated a review of Zhucheng in error.\9\ Thus, 
the Department hereby rescinds the administrative review with respect 
to Zhucheng for the period June 1, 2008, through May 31, 2009.
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    \9\ See Clorinated Isos/PRC 10/7/2009.
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Non-Market Economy Country

    The Department has treated the PRC as a non-market economy 
(``NME'') country in all past antidumping duty investigations and 
administrative reviews and continues to do so in this review.\10\ No 
interested party in this case has argued that we should do otherwise. 
Designation as an NME country remains in effect until it is revoked by 
the Department. See section 771(18)(C)(i) of the Tariff Act of 1930, as 
amended (the ``Act''). Accordingly, we calculated normal value (``NV'') 
in accordance with section 773(c) of the Act, which applies to NME 
countries.
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    \10\ See, e.g., Chlorinated Isocyanurates from the People's 
Republic of China: Final Results of Antidumping Duty Administrative 
Review, 73 FR 52645 (September 10, 2008); see also Folding Metal 
Tables and Chairs from the People's Republic of China: Final Results 
of Antidumping Duty Administrative Review, 74 FR 3560 (January 21, 
2009).
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Surrogate Country

    When the Department is investigating imports from an NME country, 
section 773(c)(1) of the Act directs it, in most instances, to base NV 
on the NME producer's FOPs. The Act further instructs that valuation of 
the FOPs shall be based on the best available information in the 
surrogate market economy country or countries considered to be 
appropriate by the Department. See section 773(c)(1) of the Act. When 
valuing the FOPs, the Department shall utilize, to the extent possible, 
the prices or costs of FOPs in one or more market economy countries 
that are: (1) At a level of economic development comparable to that of 
the NME country; and (2) significant producers of comparable 
merchandise. See section 773(c)(4) of the Act. Further, the Department 
normally values all FOPs in a single surrogate country. See 19 CFR 
351.408(c)(2). The sources of the surrogate factor values are discussed 
under the ``Normal Value'' section below and in the Surrogate Value 
Memorandum, which is on file in the Central Records Unit (``CRU''), 
Room 1117 of the main Commerce Department building.\11\
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    \11\ See Memorandum regarding: 2008-2009 Administrative Review 
of Chlorinated Isocyanurates from the People's Republic of China: 
Surrogate Value Memorandum for the Preliminary Results, dated May 
10, 2010 (``Surrogate Value Memorandum'').
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    In examining which country to select as its primary surrogate for 
this proceeding, the Department determined that India, Indonesia, the 
Philippines, Ukraine, Thailand, and Peru are countries comparable to 
the PRC in terms of economic development. See Surrogate Country List. 
On January 26, 2010, the Department issued a request for interested 
parties to submit comments on surrogate country selection. On February 
12, 2010, Jiheng submitted comments regarding the selection of a 
surrogate country. On February 23, 2010, Petitioners submitted FOP 
surrogate value information that included several values obtained from 
India.
    Jiheng argues that the Department should continue to use India as 
the surrogate country for this segment of the proceeding, as it has in 
previous segments, because, in this case, India produces comparable 
merchandise and there are publicly available data with which to value 
the reported FOP information. All parties which submitted surrogate 
value data submitted only Indian-sourced data.
    After evaluating interested parties' comments, the Department 
determined that India is the appropriate surrogate country for this 
review. The Department based its decision on the following facts: (1) 
India is at a level of economic development comparable to that of the 
PRC; (2) India is a significant producer of comparable merchandise, 
i.e., calcium hypochlorite; and (3) India provides the best opportunity 
to use reliable, publicly available data to value the FOPs. On the 
record of this review, we have usable surrogate financial data from 
India, but no such surrogate financial data from any other potential 
surrogate country. Additionally, all of the data submitted by both 
Jiheng and the Petitioners for our consideration as potential surrogate 
values are sourced from India.
    Therefore, because India best represents the experience of 
producers of comparable merchandise operating in a surrogate country, 
we have selected India as the surrogate country and accordingly have 
calculated NV using Indian prices to value the respondents' FOPs, when 
available and appropriate. See Surrogate Value Memorandum. We have 
obtained and relied upon publicly available information wherever 
possible.
    In accordance with 19 CFR 351.301(c)(3)(ii), interested parties may 
submit publicly available information to value FOPs until 20 days after 
the date of publication of the preliminary results.\12\
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    \12\ In accordance with 19 CFR 351.301(c)(1), for the final 
results of this administrative review, interested parties may submit 
factual information to rebut, clarify, or correct factual 
information submitted by an interested party less than ten days 
before, on, or after the applicable deadline for submission of such 
factual information. However, the Department notes that 19 CFR 
351.301(c)(1) permits new information only insofar as it rebuts, 
clarifies, or corrects information placed on the record. The 
Department generally will not accept the submission of additional, 
previously absent-from-the-record alternative surrogate value 
information pursuant to 19 CFR 351.301(c)(1). See Glycine from the 
People's Republic of China: Final Results of Antidumping Duty 
Administrative Review and Final Rescission, in Part, 72 FR 58809 
(October 17, 2007), and accompanying Issues and Decision Memorandum 
at Comment 2.

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[[Page 27305]]

Separate Rates

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

Absence of De Jure Control

    The Department considers the following de jure criteria in 
determining whether an individual company may be granted a separate 
rate: (1) An absence of restrictive stipulations associated with an 
individual exporter's business and export licenses; (2) any legislative 
enactments decentralizing control of companies; and (3) other formal 
measures by the government decentralizing control of companies. See 
Sparklers at 20589.
    The evidence provided by Jiheng supports a preliminary finding of 
de jure absence of government control based on the following: (1) An 
absence of restrictive stipulations associated with the individual 
exporter's business and export licenses; (2) there are applicable 
legislative enactments decentralizing control of the companies; and (3) 
there are formal measures by the government decentralizing control of 
companies. See Jiheng's AQR at Exhibit A3.1 through Exhibit A5.

Absence of De Facto Control

    Typically, the Department considers four factors in evaluating 
whether each respondent is subject to de facto government control of 
its export functions: (1) Whether the export prices are set by or are 
subject to the approval of a government agency; (2) whether the 
respondent has authority to negotiate and sign contracts and other 
agreements; (3) whether the respondent has autonomy from the government 
in making decisions regarding the selection of management; and (4) 
whether the respondent retains the proceeds of its export sales and 
makes independent decisions regarding disposition of profits or 
financing of losses. See Silicon Carbide 59 FR at 22586-87; see also 
Notice of Final Determination of Sales at Less Than Fair Value: 
Furfuryl Alcohol From the People's Republic of China, 60 FR 22544, 
22545 (May 8, 1995). The Department has determined that an analysis of 
de facto control is critical in determining whether respondents are, in 
fact, subject to a degree of government control which would preclude 
the Department from assigning separate rates.
    The evidence placed on the record of this administrative review by 
Jiheng demonstrates an absence of de facto government control with 
respect to Jiheng's exports of the merchandise under review, in 
accordance with the criteria identified in Sparklers and Silicon 
Carbide. See Jiheng's AQR at pages A-12 through A-18.

Date of Sale

    19 CFR 351.401(i) states that:

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

    Jiheng reported the shipment date as the date of sale because it 
claims that, for its U.S. sales of subject merchandise made during the 
POR, the material terms of sale were established on the shipment date, 
and for many of its sales the shipment date occurs on or before the 
invoice date. Jiheng also stated that selecting the shipment date as 
the date of sale insures a consistent methodology for selecting the 
date of sale with previous segments in which Jiheng has participated. 
We have preliminarily determined that the shipment date is the most 
appropriate date to use as Jiheng's date of sale in accordance with our 
long-standing practice of determining the date of sale as the date on 
which the final terms of sale are established.\13\ Evidence on the 
record demonstrates that, with respect to Jiheng's sales to the United 
States, sometimes the shipment date occurs prior to the invoice 
date,\14\ and it is the Department's practice to use shipment date as 
the date of sale when the shipment date occurs prior to the invoice 
date.\15\ Though not a dispositive factor for this POR, we note that we 
used the shipment date as the sale date in the prior POR.\16\
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    \13\ See Notice of Final Determination of Sales at Less Than 
Fair Value and Negative Final Determination of Critical 
Circumstances: Certain Frozen and Canned Warmwater Shrimp from 
Thailand, 69 FR 76918 (December 23, 2004), and accompanying Issues 
and Decision Memorandum at Comment 10; and Notice of Final 
Determination of Sales at Less Than Fair Value: Structural Steel 
Beams from Germany, 67 FR 35497 (May 20, 2002), and accompanying 
Issues and Decision Memorandum at Comment 2.
    \14\ See Jiheng's CQR at page C-15.
    \15\ See, e.g., Notice of Final Determinations of Sales at Less 
Than Fair Value: Certain Durum Wheat and Hard Red Spring Wheat from 
Canada, 68 FR 52741 (September 5, 2003), and accompanying Issues and 
Decision Memorandum at Comment 3.
    \16\ See Chlorinated Isocyanurates from the People's Republic of 
China: Preliminary Results of Antidumping Duty Administrative 
Review, 74 FR 27104 (June 8, 2009) (unchanged in Chlorinated 
Isocyanurates from the People's Republic of China: Final Results of 
Antidumping Duty Administrative Review, 74 FR 66087 (December 14, 
2009)).
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Fair Value Comparisons

    To determine whether sales of chlorinated isos to the United States 
by Jiheng were made at less than NV, we compared export price (``EP'') 
to NV, as described in the ``Export Price'' and ``Normal Value'' 
sections of this notice, pursuant to section 771(35) of the Act.

Export Price

    Jiheng sold the subject merchandise directly to unaffiliated 
purchasers in the United States prior to importation into the United 
States. Therefore, we have used EP in accordance with section 772(a) of 
the Act because the use of the constructed export price methodology is 
not otherwise indicated. We calculated EP based on the price, including 
the appropriate shipping terms, to the first unaffiliated purchasers 
reported by Jiheng. To this price, we added amounts for components that 
were supplied free of charge or reimbursed by the customer, where 
applicable, pursuant to section 772(c)(1)(A) of the Act.\17\
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    \17\ See Memorandum regarding: Analysis for the Preliminary 
Results of the 2008-2009 Administrative Review of Chlorinated 
Isocyanurates from the People's Republic of China: Hebei Jiheng 
Chemical Company Ltd. (May 10, 2010) (``Jiheng's Preliminary 
Analysis Memorandum'').

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[[Page 27306]]

    Jiheng reported that its U.S. customer(s) provided it with certain 
raw materials and packing materials free of charge. For Jiheng's 
products that contained inputs provided free of charge by a 
customer,\18\ we added to the U.S. price paid by Jiheng's customer the 
built-up cost (i.e., the surrogate value for these raw materials and 
packing materials multiplied by the reported FOPs for these items).\19\
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    \18\ Jiheng stated that its customer sourced materials from both 
market-economy and NME suppliers. Jiheng further stated that it does 
not know the names of the market-economy suppliers. See Jiheng's DQR 
at page D-8.
    \19\ See, e.g., Notice of Final Determination of Sales at Less 
Than Fair Value, and Affirmative Critical Circumstances, In Part: 
Certain Lined Paper Products from the People's Republic of China, 71 
FR 53079 (September 8, 2006), and accompanying Issues and Decision 
Memorandum at Comment 17.
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Normal Value

    Section 773(c)(1) of the Act provides that, in the case of an NME, 
the Department shall determine NV using an FOP methodology if the 
merchandise is exported from an NME and the information does not permit 
the calculation of NV using home-market prices, third-country prices, 
or constructed value under section 773(a) of the Act.
    The Department will base NV on FOPs in NMEs because the presence of 
government controls on various aspects of these economies renders price 
comparisons and the calculation of production costs invalid under our 
normal methodologies. Therefore, we calculated NV based on FOPs in 
accordance with sections 773(c)(3) and (4) of the Act and 19 CFR 
351.408(c). The FOPs include: (1) Hours of labor required; (2) 
quantities of raw materials employed; (3) amounts of energy and other 
utilities consumed; and (4) representative capital costs. We used the 
FOPs reported by the respondent for materials, energy, labor, by-
products, and packing. These reported FOPs included various FOPs 
provided free of charge by a customer as discussed in the ``Export 
Price'' section, above.
    In accordance with 19 CFR 351.408(c)(1), the Department will 
normally use publicly available information to value the FOPs, but when 
a producer sources an input from a market-economy country and pays for 
it in market-economy currency, the Department may value the factor 
using the actual price paid for the input.\20\ Jiheng reported that it 
did not purchase any inputs from market economy suppliers for the 
production of the subject merchandise. See Jiheng's DQR at page D-9.
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    \20\ See 19 CFR 351.408(c)(1); see also Shakeproof Assembly 
Components Div. of Ill v. United States, 268 F.3d 1376, 1382-1383 
(Fed. Cir. 2001) (affirming the Department's use of market-based 
prices to value certain FOPs).
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    With regard to the Indian import-based surrogate values, we have 
disregarded prices that we have reason to believe or suspect may be 
subsidized, such as those from Indonesia, South Korea, and Thailand. We 
have found in other proceedings that these countries maintain broadly 
available, non-industry-specific export subsidies and, therefore, it is 
reasonable to infer that all exports to all markets from these 
countries may be subsidized.\21\ We are also guided by the statute's 
legislative history that explains that it is not necessary to conduct a 
formal investigation to ensure that such prices are not subsidized. See 
H.R. Rep. No. 100-576 (1988), at 590. Rather, the Department was 
instructed by Congress to base its decision on information that is 
available to it at the time it is making its determination. Therefore, 
we have not used prices from these countries in calculating the Indian 
import-based surrogate values. Additionally, we disregarded prices from 
NME countries. Finally, imports that were labeled as originating from 
an ``unspecified'' country were excluded from the average value, 
because the Department could not be certain that they were not from 
either an NME country or a country with general export subsidies.
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    \21\ See, e.g., Frontseating Service Valves from the People's 
Republic of China; Preliminary Determination of Sales at Less Than 
Fair Value, Preliminary Negative Determination of Critical 
Circumstances, and Postponement of Final Determination, 73 FR 62952 
(October 22, 2008) (unchanged in Frontseating Service Valves from 
the People's Republic of China: Final Determination of Sales at Less 
Than Fair Value and Final Negative Determination of Critical 
Circumstances, 74 FR 10886 (March 13, 2009); and China National 
Machinery Import & Export Corporation v. United States, 293 F. Supp. 
2d 1334 (CIT 2003), affirmed 104 Fed. Appx. 183 (Fed. Cir. 2004).
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Factor Valuations

    In accordance with section 773(c) of the Act, we calculated NV 
based on the FOPs reported by Jiheng for the POR. To calculate NV, we 
multiplied the reported per-unit factor quantities by publicly 
available Indian surrogate values (except as noted below). In selecting 
the surrogate values, we selected, where possible, publicly available 
data, which represent an average non-export value and are 
contemporaneous with the POR, product-specific, and tax-exclusive. As 
appropriate, we adjusted input prices by including freight costs to 
render them delivered prices. Specifically, we added to Indian import 
surrogate values a surrogate freight cost using the shorter of the 
reported distance from the domestic supplier to the factory or the 
distance from the nearest seaport to the factory. This adjustment is in 
accordance with the decision of the U.S. Court of Appeals for the 
Federal Circuit in Sigma Corp. v. United States, 117 F. 3d 1401, 1408 
(Fed. Cir. 1997). For a detailed description of all surrogate values 
used for Jiheng, see the Surrogate Value Memorandum.
    Except as noted below, we valued raw material inputs using the 
weighted-average unit import values derived from the Monthly Statistics 
of the Foreign Trade of India, as published by the Directorate General 
of Commercial Intelligence and Statistics of the Ministry of Commerce 
and Industry, Government of India in the World Trade Atlas, available 
at http://www.gtis.com/wta.htm (``WTA''). Where we could not obtain 
publicly available information contemporaneous with the POR with which 
to value FOPs, we adjusted the surrogate values using, where 
appropriate, the Indian Wholesale Price Index (``WPI'') as published in 
the International Financial Statistics of the International Monetary 
Fund. See Surrogate Value Memorandum. We further adjusted these prices 
to account for freight costs incurred between the supplier and 
respondent.
    To value truck freight, we used the freight rates published by 
http://www.infobanc.com, ``The Great Indian Bazaar, Gateway to Overseas 
Markets.'' The logistics section of the website contains inland freight 
truck rates between many large Indian cities. The truck freight rates 
are for the period August 2008 through May 2009 and, therefore, are 
contemporaneous with the POR. See Surrogate Value Memorandum.
    The Department valued brokerage and handling using a simple average 
of the brokerage and handling costs that were reported in public 
submissions that were filed in three antidumping duty cases. 
Specifically, we averaged the public brokerage and handling expenses 
reported by Navneet Publications (India) Ltd. in the 2007-2008 
administrative review of certain lined paper products from India, Essar 
Steel Limited in the 2006-2007 antidumping duty administrative review 
of hot-rolled carbon steel flat products from India, and Himalaya 
International Ltd. in the 2005-2006 administrative review of certain 
preserved mushrooms from India. The Department adjusted the average 
brokerage and handling rate for inflation. See Surrogate Value 
Memorandum.

[[Page 27307]]

    To value calcium chloride, barium chloride, zinc sulfate, and 
sulfuric acid, we used Chemical Weekly data. We adjusted these values 
for taxes and to account for freight costs incurred between the 
supplier and the respondent.
    Jiheng reported that its U.S. customer(s) provided certain raw 
materials and packing materials free of charge. For Jiheng's products 
that included raw materials and packing materials provided free of 
charge by its customer, consistent with the Department's practice and 
section 773(c)(1)(B) of the Act, we used the built-up cost (i.e., the 
surrogate value for these raw materials and packing materials 
multiplied by the reported FOPs for these items) in the NV 
calculation.\22\ Where applicable, we also adjusted these values to 
account for freight costs incurred between the port of exit and 
Jiheng's plants. See Surrogate Value Memorandum, and Jiheng's 
Preliminary Analysis Memorandum.
---------------------------------------------------------------------------

    \22\ See, e.g., Notice of Final Determination of Sales at Less 
Than Fair Value, and Affirmative Critical Circumstances, In Part: 
Certain Lined Paper Products from the People's Republic of China, 71 
FR 53079 (September 8, 2006), and accompanying Issues and Decision 
Memorandum at Comment 17.
---------------------------------------------------------------------------

    To value electricity, we used price data for small, medium, and 
large industries, as published by the Central Electricity Authority of 
the Government of India in its publication entitled ``Electricity 
Tariff & Duty and Average Rates of Electricity Supply in India,'' dated 
March 2008. These electricity rates represent actual country-wide, 
publicly-available information on tax-exclusive electricity rates 
charged to industries in India. See Surrogate Value Memorandum.
    To value water, we used the Maharashtra Industrial Development 
Corporation (``MIDC'') water rates available at http://www.midcindia.com/water-supply. See Surrogate Value Memorandum.
    To value steam coal, we used data obtained for grades B and C coal 
reported in the December 2007 Coal India Limited Circular. See 
Surrogate Value Memorandum.
    To value steam, we used data obtained from the Indian financial 
statements of Hindalco Industries Limited. See Surrogate Value 
Memorandum.
    Jiheng reported chlorine, hydrogen gas, ammonia gas, and sulfuric 
acid as by-products in the production of subject merchandise. We find 
in this administrative review that Jiheng has appropriately reported 
its by-products and, therefore, we have granted Jiheng a by-product 
offset for the quantities of these reported by-products. We valued 
chlorine gas with POR data obtained from the financial statements of 
Bihar Caustic & Chemicals, Kanoria Chemicals & Industries Limited, DCM 
Shriram Consolidated Ltd., all of which are Indian producers and 
sellers of chlorine gas. We valued hydrogen gas with POR data obtained 
from the financial statements of Bihar Caustic & Chemicals and DCM 
Shriram Consolidated Ltd., both of which are Indian producers and 
sellers of hydrogen gas. See Surrogate Value Memorandum.
    For direct labor, indirect labor, and packing labor, consistent 
with 19 CFR 351.408(c)(3), we used the PRC regression-based wage rate 
as reported on Import Administration's Web site.\23\ Because this 
regression-based wage rate does not separate the labor rates into 
different skill levels or types of labor, we have applied the same wage 
rate to all skill levels and types of labor reported by Jiheng. See 
Surrogate Value Memorandum.
---------------------------------------------------------------------------

    \23\ See Expected Wages of Selected NME Countries (December 9, 
2009), available at http://ia.ita.doc.gov/wages; see also, 2009 
Calculation of Expected Non-Market Economy Wages, 74 FR 65092 
(December 9, 2009). The source of these wage rate data on the Import 
Administration's web site is the Yearbook of Labour Statistics, ILO, 
(Geneva), Chapter 5B: Wages in Manufacturing. The years of the 
reported wage rates range from 2006 to 2007.
---------------------------------------------------------------------------

    For packing materials, we used the per-kilogram values obtained 
from the WTA and made adjustments to account for freight costs incurred 
between the PRC supplier and Jiheng's plants. See Surrogate Value 
Memorandum.
    To calculate surrogate values for factory overhead, selling, 
general, and administrative expenses (``SG&A''), and profit for the 
preliminary results, we used financial information from both Kanoria 
Chemicals and Industries Limited (``Kanoria'') and Aditya Birla 
Chemicals (India) Limited (``Aditya'') for the year ending March 31, 
2009. From this information, we were able to determine average factory 
overhead as a percentage of the total raw materials, labor, and energy 
(``ML&E'') costs, average SG&A as a percentage of ML&E plus overhead 
(i.e., cost of manufacture), and an average profit rate as a percentage 
of the cost of manufacture plus SG&A. See Surrogate Value Memorandum 
for a full discussion of the calculation of these ratios.

Currency Conversion

    Where the factor valuations were reported in a currency other than 
U.S. dollars, in accordance with section 773A(a) of the Act, we made 
currency conversions into U.S. dollars based on the exchange rates in 
effect on the dates of the U.S. sales, as certified by the Federal 
Reserve Bank.

Preliminary Results

    We preliminarily determine that the following weighted-average 
dumping margin exists:

------------------------------------------------------------------------
                                                                Margin
                    Manufacturer/exporter                      (percent)
------------------------------------------------------------------------
Hebei Jiheng Chemical Co., Ltd..............................       11.65
------------------------------------------------------------------------

Disclosure

    We will disclose the calculations used in our analysis to parties 
to this proceeding within five days of the publication date of this 
notice. See 19 CFR 351.224(b). Interested parties are invited to 
comment on the preliminary results and may submit case briefs and/or 
written comments within 30 days of the date of publication of this 
notice. See 19 CFR 351.309(c)(ii). Rebuttal briefs and rebuttals to 
written comments, limited to issues raised in such briefs or comments, 
may be filed no later than five days after the time limit for filing 
the case briefs. See 19 CFR 351.309(d). The Department requests that 
parties submitting written comments provide an executive summary and a 
table of authorities as well as an additional copy of those comments 
electronically.
    Any interested party may request a hearing within 30 days of 
publication of this notice. See 19 CFR 351.310(c). Hearing requests 
should contain the following information: (1) The party's name, 
address, and telephone number; (2) the number of participants; and (3) 
a list of the issues to be discussed. Oral presentations will be 
limited to issues raised in the briefs. If a request for a hearing is 
made, parties will be notified of the time and date for the hearing to 
be held at the U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230. See 19 CFR 351.310(d).
    The Department intends to issue the final results of this 
administrative review, which will include the results of its analysis 
of issues raised in any such comments, within 120 days of publication 
of these preliminary results, pursuant to section 751(a)(3)(A) of the 
Act.

Assessment Rates

    Upon issuance of the final results, the Department will determine, 
and CBP shall assess, antidumping duties on all appropriate entries 
covered by this review. The Department intends to issue assessment 
instructions to CBP 15 days

[[Page 27308]]

after the publication date of the final results of this review. In 
accordance with 19 CFR 351.212(b)(1), we will calculate exporter/
importer (or customer) -specific assessment rates for the merchandise 
subject to this review. Where the respondent has reported reliable 
entered values, we calculated importer (or customer) -specific ad 
valorem rates by aggregating the dumping margins calculated for all 
U.S. sales to each importer (or customer) and dividing this amount by 
the total entered value of the sales to each importer (or customer). 
See 19 CFR 351.212(b)(1). Where an importer (or customer) -specific ad 
valorem rate is greater than de minimis, we will apply the assessment 
rate to the entered value of the importers'/customers' entries during 
the POR. See 19 CFR 351.212(b)(1).
    Where we do not have entered values for all U.S. sales, we 
calculated a per-unit assessment rate by aggregating the antidumping 
duties due for all U.S. sales to each importer (or customer) and 
dividing this amount by the total quantity sold to that importer (or 
customer). See 19 CFR 351.212(b)(1). To determine whether the duty 
assessment rates are de minimis, in accordance with the requirement set 
forth in 19 CFR 351.106(c)(2), we calculated importer (or customer) -
specific ad valorem ratios based on the estimated entered value. Where 
an importer (or customer) -specific ad valorem rate is zero or de 
minimis, we will instruct CBP to liquidate appropriate entries without 
regard to antidumping duties. See 19 CFR 351.106(c)(2).

Cash Deposit Requirements

    Further, the following cash deposit requirements will be effective 
upon publication of the final results of this administrative review for 
all shipments of the subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication date, as 
provided for by section 751(a)(2)(C) of the Act: (1) For Jiheng, the 
cash deposit rate will be the company-specific rate established in the 
final results of review (except, if the rate is zero or de minimis, a 
zero cash deposit will be required); (2) for previously investigated or 
reviewed PRC and non-PRC exporters not listed above that have separate 
rates, the cash deposit rate will continue to be the exporter-specific 
rate published for the most recent period; (3) for all PRC exporters of 
subject merchandise that have not been found to be entitled to a 
separate rate, the cash deposit rate will be the PRC-wide rate of 
285.63 percent; and (4) for all non-PRC exporters of subject 
merchandise which have not received their own rate, the cash deposit 
rate will be the rate applicable to the PRC exporter(s) that supplied 
that non-PRC exporter. These deposit requirements, when imposed, shall 
remain in effect until further notice.

Notification to Importers

    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f)(2) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    These preliminary results are issued and published in accordance 
with sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: May 10, 2010.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2010-11605 Filed 5-13-10; 8:45 am]
BILLING CODE 3510-DS-P