[Federal Register Volume 76, Number 67 (Thursday, April 7, 2011)]
[Notices]
[Pages 19322-19325]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-8323]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-831]
Garlic From the People's Republic of China: Rescission of
Antidumping Duty New Shipper Reviews
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
SUMMARY: On November 12, 2010, the Department of Commerce (Department)
published preliminary results for the new shipper reviews (NSRs) of
fresh garlic from the People's Republic of China (PRC) covering the
period of review (POR) November 1, 2008, through October 31, 2009. See
Fresh Garlic From the People's Republic of China: Preliminary Results
of New Shipper Reviews and Preliminary Rescission, in Part, 75 FR 69415
(November 12, 2010) (Preliminary Results). The reviews covered three
respondents: Jinxiang Chengda Imp & Exp Co., Ltd. (Chengda), Zhengzhou
Huachao Industrial Co., Ltd. (Huachao), and Jinxiang Yuanxin Imp & Exp
Co., Ltd. (Yuanxin).
As discussed below, we preliminarily found that Yuanxin's and
Huachao's sales were bona fide and that these sales were made in the
United States at prices below normal value (NV). In addition, we found
Chengda's sales to be not bona fide, and announced our preliminary
intent to rescind Chengda's new shipper review. For the final results
of this review, we are finding the sales of all three respondents,
Chengda, Huachao, and Yuanxin, to be not bona fide. Therefore, because
there were no other shipments or entries by these three companies
during the POR, we are rescinding these new shipper reviews.
DATES: Effective Date: April 7, 2011.
FOR FURTHER INFORMATION CONTACT: Scott Lindsay, AD/CVD Operations,
Office 6, Import Administration, International Trade Administration,
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW.,
Washington, DC 20230; telephone: (202) 482-0780.
SUPPLEMENTARY INFORMATION:
Background
Since the Preliminary Results, the following events have occurred.
On December 2, 2010, surrogate value information was placed on the
record by Huachao. On December 30, 2010, the Department extended the
time limit for the final results of this new shipper review. On January
26, 2011, the Department issued a supplemental questionnaire to
Yuanxin. On January 27, 2011, the Department issued a supplemental
questionnaire to Huachao. On February 4, 2011, the Department issued a
letter to Yuanxin concerning the business proprietary designation of
the company's Web site address.
On February 4, 2011, the Department issued the briefing schedule
for briefs addressing all issues except the bona fides of Huachao's and
Yuanxin's respective sales. On February 8, 2011, Yuanxin requested an
extension to the deadlines as established in the February 4, 2011
briefing schedule. On February 9, 2011, the Department issued an
extension of this briefing schedule, with briefs due February 17, 2011,
and rebuttal briefs due February 22, 2011. On February 14, 2011, the
Department placed information related to Jinxiang Hejia Co., Ltd.'s NSR
sale to the United States, from the 2007/2008 NSR, on the record of
this review. Huachao and Yuanxin submitted supplemental questionnaire
responses on February 14, 2011. Yuanxin also submitted its case brief
on February 14, 2011. On February 15, 2011, the Department placed
memoranda on the record of this review that included information
related to
[[Page 19323]]
Yuanxin's domain name registration and the corporate records of the
importers and customers of each of the exporters involved in this
review. On February 17, 2011, Huachao and Chengda submitted case
briefs.
On February 18, 2011, the Department issued the briefing schedule
for briefs addressing only the bona fides of Huachao's and Yuanxin's
respective sales. Additionally, on February 18, 2011, the Fresh Garlic
Producers Association and its individual members (Christopher Ranch
L.L.C., the Garlic Company, Valley Garlic, and Vessey and Company,
Inc.) (collectively, Petitioners) requested an extension of the
February 22, 2011 deadline for rebuttal briefs not related to the bona
fides of Huachao's and Yuanxin's respective sales. On February 22,
2011, the Department granted Petitioners' February 18, 2011 request for
an extension to the rebuttal briefs deadline, the new deadline becoming
February 25, 2011. On February 24, 2011, Petitioners submitted a
rebuttal to Huachao's February 14, 2011 supplemental questionnaire
response. On February 25, 2011, Petitioners submitted rebuttal briefs
for all three respondents. Also, on February 25, 2011, Petitioners
submitted a brief regarding whether Huachao's POR sale was bona fide.
On March 1, 2011, Huachao requested an extension to the deadline of
the bona fides rebuttal briefs as established in the Department's
February 18, 2011 briefing schedule. On March 2, 2011, the Department
granted Huachao's March 1, 2011 request for an extension, the new
deadline for bona fides rebuttal briefs becoming March 7, 2011. On
March 3, 2011, Huachao submitted a letter requesting that the
Department reject Petitioners' February 24, 2011 submission on the
grounds that it contained untimely new factual information. Further,
Huachao argued that Petitioners' February 25, 2011 case brief also be
rejected, as it relies upon information contained in the February 24,
2011 submission. The information in question involves the nature of the
United States garlic market and the appropriate benchmark to be used in
determining the bona fide nature of Huachao's sale. The Department
found this information to be relevant to the information provided by
Huachao in its supplemental response, which addressed Department
questions regarding whether Huachao's sale was bona fide. Thus, the
Department concluded that Petitioners' submission was timely rebuttal
information allowed for under 19 CFR 351.301(c). Finally, on March 7,
2011, Huachao submitted a rebuttal brief to the February 25, 2011 case
brief submitted by Petitioners regarding the bona fides of its sale.
On March 16, 2011, Department officials met with Chengda's counsel
to discuss issues related to the case briefs. See Memorandum for the
File from Lingjun Wang, Case Analyst, AD/CVD Operations, Office 6,
``Meeting with Counsel for the Jinxiang Chengda Import & Export Co.,
Ltd.: New Shipper Review of the Antidumping Duty Order on Fresh Garlic
from China'' (March 16, 2011). On March 17, 2011, Department officials
met with Petitioners' counsel to discuss issues related to the case
briefs. See Memorandum for the File from David Lindgren, Case Analyst,
AD/CVD Operations, Office 6, ``Meeting with Counsel for the
Petitioners: New Shipper Review of the Antidumping Duty Order on Fresh
Garlic from China'' (March 17, 2011).
Scope of the Order
The products covered by the order are all grades of garlic, whole
or separated into constituent cloves, whether or not peeled, fresh,
chilled, frozen, provisionally preserved, or packed in water or other
neutral substance, but not prepared or preserved by the addition of
other ingredients or heat processing. The differences between grades
are based on color, size, sheathing, and level of decay. The scope of
this order does not include the following: (a) garlic that has been
mechanically harvested and that is primarily, but not exclusively,
destined for non-fresh use; or (b) garlic that has been specially
prepared and cultivated prior to planting and then harvested and
otherwise prepared for use as seed. The subject merchandise is used
principally as a food product and for seasoning. The subject garlic is
currently classifiable under subheadings 0703.20.0010, 0703.20.0020,
0703.20.0090, 0710.80.7060, 0710.80.9750, 0711.90.6000, and
2005.90.9700 of the Harmonized Tariff Schedule of the United States
(HTSUS). Although the HTSUS subheadings are provided for convenience
and customs purposes, our written description of the scope of the order
is dispositive. In order to be excluded from the order, garlic entered
under the HTSUS subheadings listed above that is (1) mechanically
harvested and primarily, but not exclusively, destined for non-fresh
use or (2) specially prepared and cultivated prior to planting and then
harvested and otherwise prepared for use as seed must be accompanied by
declarations to CBP to that effect.
Analyses of Comments Received
In addition to commenting on the bona fides of Chengda's and
Huachao's U.S. sales (see Bona Fides Analysis section below), the
parties addressed, in their case and rebuttal briefs, three surrogate
valuation issues: (1) What to use as the surrogate value for raw garlic
bulbs; (2) which financial statements to use as the surrogate financial
ratios; and (3) how to properly calculate the wage rate. Since, as
discussed below, we are rescinding these reviews, the Department need
not address the parties' comments on these issues pertaining to the
calculation of the dumping margin.
Bona Fides Analysis
In conducting an NSR, the Department examines price, quantity, and
other circumstances associated with the sale to determine if the sale
was based on normal commercial considerations and presents an accurate
representation of the company's normal business practices, and provides
a future indicator of its future selling practice. See Shandong Chenhe
Int'l Trading Co. v. United States, No. 08-00373, slip op. at 19 (Ct.
Int'l Trade Nov. 22, 2010); see also Tianjin Tiancheng Pharmaceutical
Co., Ltd. v. United States, 366 F. Supp. 2d 1246, 1250 (Ct. Int'l Trade
2005); and Hebei New Donghua Amino Acid Co., Ltd. v. United States, 374
F. Supp. 2d 1333, 1342 (Ct. Int'l Trade 2005). If the Department
determines that the price was not based on normal commercial
considerations or is atypical of the respondent's normal business
practices, including other sales of comparable merchandise, the sale
may be considered not bona fide, and, as such, cannot serve as a
reasonable or reliable basis for calculating a dumping margin.
In the Preliminary Results, the Department found Chengda's POR
sales to be not bona fide. The Department found that Huachao's POR
sale, however, was made on a bona fide basis, noting that it would
continue to examine all factors relating to the bona fides of that sale
given the Department's concerns regarding the price, quantity, and
payment terms of the sale. Likewise, the Department found that
Yuanxin's POR sale was also made on a bona fide basis, noting that it
would continue to examine the bona fides of the sale given the
Department's concerns regarding the price, quantity, and atypicality of
the product and transaction. Based on our continuing analyses of all
aspects of the parties' sales, summarized below, and our analyses of
supplemental questionnaire
[[Page 19324]]
responses, of information and documentation from a prior NSR placed on
the record of this review, and of comments made by interested parties,
the Department continues to find that Chengda's sales are not bona
fide, and now finds that the sales of Yuanxin and Huachao are not bona
fide as well. As such, the sales made by all three parties do not
provide reasonable or reliable bases for calculating dumping margins.
Chengda
For the Preliminary Results, the Department analyzed the bona fides
of Chengda's sales and preliminarily found Chengda's sales to the
United States to be not bona fide. See ``Bona Fide Nature of the Sale
in the Antidumping Duty New Shipper Review of Fresh Garlic from the
People's Republic of China (PRC): Jinxiang Chengda Imp & Exp Co.,
Ltd.'' (November 1, 2010). Since the Preliminary Results, both Chengda
and Petitioners have submitted arguments regarding whether Chengda's
POR shipment was bona fide. Significant portions of these arguments
involve discussion of business proprietary information (BPI).
Therefore, the Department's summaries of, and positions on, these
arguments, in addition to our full analysis of the bona fides of
Chengda's sales, are included in the memorandum, ``Final Results of
Antidumping Duty New Shipper Review of Fresh Garlic from the People's
Republic of China: Bona Fides Analysis of Chengda Imp & Exp Co.,
Ltd.,'' issued concurrently with this Federal Register notice. Based on
the Department's complete analysis of all the information on the record
of this review regarding the bona fides of Chengda's NSR sales, the
Department continues to find Chengda's sales not bona fide because (1)
Chengda's sale prices are so high that they are atypical, aberrational,
commercially unreasonable, and not indicative of future sales, and (2)
Chengda's sales quantities are too small to reflect normal commercial
practices of the garlic industry.
Huachao
For the Preliminary Results, the Department analyzed the bona fides
of Huachao's sale and preliminarily found Huachao's sale to the United
States to be bona fide, noting that we would continue to examine all
factors relating to the bona fides of that sale given the Department's
concerns regarding the price, quantity, and payment terms of the sale.
See ``Bona Fide Nature of the Sale in the Antidumping Duty New Shipper
Review of Fresh Garlic from the People's Republic of China (PRC):
Zhengzhou Huachao Industrial Co., Ltd.'' (November 1, 2010). After the
Preliminary Results, the Department issued a supplemental questionnaire
to Huachao. In addition, Petitioners filed a case brief and Huachao
filed a rebuttal brief on whether Huachao's sale should be considered
bona fide. Significant portions of these arguments involve discussion
of BPI. Therefore, the Department's summaries of, and positions on,
these arguments, in addition to our full analysis of the bona fides of
Huachao's sale, are included in the memorandum ``Final Results of
Antidumping Duty New Shipper Review of Fresh Garlic from the People's
Republic of China: Bona Fides Analysis of Zhengzhou Huachao Industrial
Co., Ltd.,'' issued concurrently with this Federal Register notice.
Based on the Department's complete analysis of all the information on
the record of this review regarding the bona fides of Huachao's NSR
sale, the Department finds Huachao's sale to be not bona fide because
(1) Huachao's sale price is so high as to be commercially unreasonable
and not indicative of the garlic industry, (2) Huachao's sales quantity
is not commercially reasonable, (3) Huachao's function as the processor
of its U.S. sale is atypical of its normal business practice, and (4)
there are inconsistencies in the information provided by Huachao's
customer in the United States, raising doubts about Huachao's
description of the sale's structure.
Yuanxin
In the Preliminary Results, the Department found that Yuanxin's POR
sale was made on a bona fide basis, noting that it would continue to
examine the bona fides of the sale given the Department's concerns
regarding the price, quantity, and atypical nature of the product and
transaction. See ``Bona Fide Nature of the Sale in the Antidumping Duty
New Shipper Review of Fresh Garlic from the People's Republic of China
(PRC): Jinxiang Yuanxin Imp & Exp Co., Ltd.'' (November 1, 2010). As
noted in the background section, after the Preliminary Results, the
Department issued a supplemental questionnaire to Yuanxin. In addition,
new information with respect to the bona fides of Yuanxin's sale was
placed on the record of this review. See the Department's February 14,
2011 memorandum to the file regarding Jinxiang Hejia Co., Ltd.'s NSR
and Yuanxin's February 14, 2011 supplemental questionnaire response;
see also the Department's February 15, 2011 memorandum to the file
regarding Yuanxin's domain name registration and the Department's
February 15, 2011 memorandum to the file regarding the corporate
records of the importers and customers of each of the exporters
involved in this review.
Significant portions of the issues involved in Yuanxin's bona fides
include BPI. Therefore, we have addressed all of the arguments in a
separate memorandum as part of our full bona fides analysis. See
``Final Results of Antidumping Duty New Shipper Review of Fresh Garlic
from the People's Republic of China: Bona Fides Analysis of Jinxiang
Yuanxin Imp & Exp Co., Ltd.,'' issued concurrently with this Federal
Register notice. Based on the Department's complete analysis of all the
information on the record of this review regarding the bona fides of
Yuanxin's NSR sale, the Department finds Yuanxin's sale to be not bona
fide because (1) Yuanxin's sale price is so high as to be commercially
unreasonable and not indicative of future sales, (2) Yuanxin's sales
quantity is not representative of the garlic industry, and (3) the
structure of Yuanxin's U.S. sale is of an unusual nature.
Rescission of New Shipper Reviews
For the foregoing reasons, the Department finds that the sales of
all three new shippers are not bona fide and that these sales do not
provide a reasonable or reliable basis for calculating a dumping
margin. Because these non-bona fide sales were the only sales of
subject merchandise during the POR, the Department is rescinding all
three new shipper reviews in their entirety.
Notification to Importers
The Department will notify U.S. Customs and Border Protection that
bonding is no longer permitted to fulfill security requirements for
shipments by Chengda, Huachao, and Yuanxin of fresh garlic from the PRC
entered, or withdrawn from warehouse, for consumption in the United
States on or after the publication of this rescission notice in the
Federal Register, and that a cash deposit of $4.71 per kilogram should
be collected for all shipments of the subject merchandise entered, or
withdrawn from warehouse, for consumption on or after the publication
date of this notice, as provided for by section 751(a)(2)(C) of the
Act, by Chengda, Huachao, and Yuanxin.
This notice is the only reminder to parties subject to the
administrative protective order (APO) of their responsibility
concerning the return or destruction of proprietary information
[[Page 19325]]
disclosed under the APO in accordance with 19 CFR 351.305(a)(3). Timely
written notification of the return or destruction of APO materials or
conversion to judicial protective order is hereby requested. Failure to
comply with the regulations and the terms of an APO is a sanctionable
violation.
These new shipper reviews and notice are issued and published in
accordance with sections 751(a)(2)(B) and 777(i) of the Act and 19 CFR
351.214.
Dated: March 31, 2011.
Ronald K. Lorentzen,
Deputy Assistant Secretary for Import Administration.
[FR Doc. 2011-8323 Filed 4-6-11; 8:45 am]
BILLING CODE 3510-DS-P