[Federal Register Volume 77, Number 136 (Monday, July 16, 2012)]
[Notices]
[Pages 41746-41754]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-17314]
[[Page 41746]]
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DEPARTMENT OF COMMERCE
International Trade Administration
[A-570-898]
Chlorinated Isocyanurates From the People's Republic of China:
Preliminary Results 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 (AD) 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, 2010,
through May 31, 2011. This administrative review covers four producers/
exporters of the subject merchandise: Hebei Jiheng Chemical Co., Ltd.
(Hebei Jiheng) and Hebei Jiheng Baikang Chemical Industry Co., Ltd.
(Baikang) (collectively, Jiheng); Juancheng Kangtai Chemical Co., Ltd.
(Juancheng Kangtai) and Juancheng Ouya Chemical Co., Ltd. (Ouya)
(collectively, Kangtai); Nanning Chemical Industry Co., Ltd. (Nanning);
and Zhucheng Taisheng Chemical Co., Ltd. (Zhucheng). Jiheng and Kangtai
are the two producers/exporters being individually examined as
mandatory respondents. We preliminarily determine that Jiheng made
sales in the United States at prices below normal value (NV) and that
Kangtai did not make sales in the United States at prices below NV.
With respect to the two remaining respondents in this administrative
review, we preliminarily determine that Nanning and Zhucheng have
demonstrated that they are eligible for a separate rate, and the rate
assigned to these companies is discussed below, in the ``Margin for
Separate-Rate Companies'' section. If these preliminary results are
adopted in our final results of review, we will instruct U.S. Customs
and Border Protection (CBP) to assess antidumping duties on entries of
subject merchandise during the POR for which the importer-specific
assessment rates are above de minimis. We invite interested parties to
comment on these preliminary results.
DATES: Effective Date:
July 16, 2012.
FOR FURTHER INFORMATION CONTACT: Emily Halle or Andrew Huston, 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-
0176 or (202) 482-4261.
SUPPLEMENTARY INFORMATION:
Background
On July 28, 2011, the Department initiated the administrative
review of the antidumping duty order on chlorinated isos from the PRC
covering the period June 1, 2010, through May 31, 2011.\1\ Between
September 26 and October 3, 2011, Jiheng, Kangtai, Nanning, and
Zhucheng each submitted either a separate rate application or
certification, as appropriate. Due to the large number of requests
received, the Department limited the number of mandatory respondents
selected for this review to the two largest exporters/producers, based
on export volume as reported to CBP, for which a review was requested--
Jiheng and Kangtai.\2\
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\1\ See Initiation of Antidumping and Countervailing Duty
Administrative Reviews, Requests for Revocations in Part and
Deferral of Administrative Reviews, 76 FR 45227 (July 28, 2011)
(Initiation Notice).
\2\ See Memorandum titled ``Administrative Review of the
Antidumping Duty Order on Chlorinated Isocyanurates from the
People's Republic of China: Respondent Selection,'' dated October 6,
2011 (Respondent Selection Memorandum).
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On October 6, 2011, the Department issued its AD questionnaire to
the two mandatory respondents, Jiheng and Kangtai, to which both
respondents responded in a timely manner. On November 3, 2011, Clearon
Corporation and Occidental Chemical Corporation (Petitioners) requested
that the Department conduct a verification of Jiheng and Kangtai. On
December 16, 2011, Petitioners submitted deficiency comments regarding
Kangtai's section A questionnaire response, and on January 9, 2012,
submitted deficiency comments regarding Kangtai's section C and D
questionnaire responses and Jiheng's section A, C and D questionnaire
responses.
On February 1, 2012, the Department published a notice in the
Federal Register extending the time limit for the preliminary results
of review from March 1, 2012, until June 29, 2012.\3\ The Department
issued supplemental questionnaires to Jiheng and Kangtai on February
24, 2012, and February 28, 2012, respectively, and both respondents
submitted responses in a timely manner. On May 3, 2012, and May 11,
2012, the Department issued an additional supplemental questionnaire to
Jiheng and Kangtai, respectively, to which both companies responded in
a timely manner.
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\3\ See Chlorinated Isocyanurates From the People's Republic of
China: Extension of Time Limit for the Preliminary Results of the
Antidumping Duty Administrative Review, 77 FR 4992 (February 1,
2012).
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Scope of the Order
The products covered by the order are chlorinated isocyanurates,
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. The 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 the order is dispositive.
Respondent Selection
In accordance with section 777A(c)(2) of the Tariff Act of 1930, as
amended (the Act), the Department selected the two largest exporters
(by quantity) of chlorinated isos from the PRC (i.e., Jiheng and
Kangtai) based on the CBP data for entries of subject merchandise
during the POR as the mandatory respondents in this review.\4\
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\4\ See Respondent Selection Memorandum.
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Affiliation and Single Entity Treatment
The Department is preliminarily determining that Hebei Jiheng and
Baikang are affiliated parties, and Juancheng Kangtai and Ouya are
affiliated parties within the meaning of section 771(33) of the Act.
The evidence placed on the record of this review by Jiheng demonstrates
that Hebei Jiheng owns five percent or more of the voting shares in
Baikang, and that these parties are therefore affiliated under section
771(33)(E) of the Act.\5\ The Department
[[Page 41747]]
has previously determined that Juancheng Kangtai and Ouya are
affiliated because their owners are members of a family (siblings) and
are affiliated under section 771(33)(A) of the Act.\6\ Based on our
examination of the evidence presented in Kangtai's questionnaire
responses in this instant review, we have determined that the
underlying facts of this case have not changed since the Department
last reviewed Kangtai.
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\5\ See Memorandum titled ``2010-2011 Administrative Review of
the Antidumping Duty Order on Chlorinated Isocyanurates from the
People's Republic of China: Affiliation of Hebei Jiheng Chemical
Company, Ltd. (Jiheng) and Hebei Jiheng Baikang Chemical Industry
Co., Ltd. (Baikang),'' dated June 29, 2012 (Jiheng Affiliation
Memorandum).
\6\ See Chlorinated Isocyanurates From the People's Republic of
China: Final Results of June 2008 Through November 2008 Semi-Annual
New Shipper Review, 74 FR 68575 (December 28, 2009) (Kangtai Final
Results).
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The Department preliminarily determines that Hebei Jiheng and
Baikang should be treated as a single entity (i.e., Jiheng) for
purposes of calculating an AD margin pursuant to 19 CFR 351.401(f).\7\
Hebei Jiheng and Baikang produce identical merchandise and have similar
production facilities used to produce the subject merchandise.\8\
Additionally, the level of affiliation between Hebei Jiheng and Baikang
(i.e., Baikang is wholly-owned by Hebei Jiheng) demonstrates that there
is a significant potential for manipulation of price or production.\9\
During the POR, all of the subject merchandise under review produced by
Baikang was sold to Hebei Jiheng for re-sale in the home market, U.S.
market and third country markets.
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\7\ See Memorandum titled ``2010-2011 Administrative Review of
the Antidumping Duty Order on Chlorinated Isocyanurates from the
People's Republic of China: Affiliation of Hebei Jiheng Chemical
Company, Ltd. (Jiheng) and Hebei Jiheng Baikang Chemical Industry
Co., Ltd. (Baikang)'' dated June 29, 2012.
\8\ See Jiheng's November 29, 2011 section D response at D-6.
\9\ See Jiheng's May 11, 2012 supplemental questionnaire
response; see also Jiheng Affiliation Memorandum.
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The Department previously determined that Juancheng Kangtai and
Ouya should be treated as a single entity.\10\ After examining the
evidence placed on the record of this review by Kangtai, the Department
determines that this instant review has the same fact pattern as the
record of Kangtai's previous review. Specifically, the Department
continues to find that both companies produce subject merchandise and
therefore have similar production facilities that would not require
substantial retooling in order to restructure manufacturing
priorities.\11\ Additionally, as noted above, all owners of Juancheng
Kangtai and Ouya continue to be affiliated, and, as owners and holders
of managerial positions of both companies, have complete control and
are in a position to exercise restraint or direction over Juancheng
Kangtai and Ouya.\12\ Therefore, the Department preliminarily
determines that Juancheng Kangtai and Ouya should be treated as a
single entity (i.e., Kangtai) for purposes of calculating an AD margin
pursuant to 19 CFR 351.401(f).
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\10\ See Kangtai Final Results and accompanying Issues and
Decision Memorandum at Comment 3.
\11\ See Kangtai's November 10, 2011 section A submission at 11.
\12\ See Kangtai's November 10, 2011 section A submission at
exhibit A-6.
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Non-Market Economy Country
In every case conducted by the Department involving the PRC, the
PRC has been treated as a non-market economy (NME) country.\13\
Moreover, the Department's most recent examination of the PRC's NME
status determined that such status should continue.\14\ In accordance
with section 771(18)(C)(i) of the Act, any determination that a foreign
country is an NME country shall remain in effect until revoked by the
administering authority. The Department has not revoked the PRC's
status as an NME country, and thus we have treated the PRC as an NME in
these preliminary results and calculated NV in accordance with section
773(c) of the Act, which applies to NME countries.
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\13\ See, e.g., Certain Kitchen Appliance Shelving and Racks
From the People's Republic of China: Preliminary Determination of
Sales at Less Than Fair Value and Postponement of Final
Determination, 74 FR 9591, 9593 (March 5, 2009), unchanged in
Certain Kitchen Appliance Shelving and Racks From the People's
Republic of China: Final Determination of Sales at Less Than Fair
Value, 74 FR 36656 (July 24, 2009).
\14\ See Memorandum titled ``Antidumping Duty Investigation of
Certain Lined Paper Products from the People's Republic of China
(China): China's Status as a Non-Market Economy (``NME''),'' dated
August 30, 2006 (on file in the Department's Central Records Unit on
the record of case number A-570-901).
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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 factors of production (FOPs). The Act further
instructs that valuation of the FOPs shall be based on the best
available information in the surrogate market economy (ME) country or
countries considered to be appropriate by the Department.\15\ When
valuing the FOPs, the Department shall utilize, to the extent possible,
the prices or costs of FOPs in one or more ME countries that are: (1)
At a level of economic development comparable to that of the NME
country; and (2) significant producers of comparable merchandise.\16\
The sources of the surrogate factor values are discussed under the
``Normal Value'' section, below, and in the Preliminary Surrogate Value
Memorandum,\17\ which is on file electronically via Import
Administration's Antidumping and Countervailing Duty Centralized
Electronic Services System (IA ACCESS). Access to IA ACCESS is
available in the Central Records Unit, main Commerce Building, Room
7046.
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\15\ See section 773(c)(1) of the Act.
\16\ See section 773(c)(4) of the Act.
\17\ See Memorandum titled ``2010-2011 Administrative Review of
the Antidumping Duty Order on Chlorinated Isocyanurates from the
People's Republic of China: Preliminary Results Surrogate Value
Memorandum,'' dated June 29, 2012 (Preliminary Surrogate Value
Memorandum).
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In examining which country to select as its primary surrogate for
this proceeding, the Department determined that Colombia, Indonesia,
the Philippines, South Africa, Thailand and Ukraine are countries
comparable to the PRC in terms of economic development.\18\ Once we
have identified the countries that are economically comparable to the
PRC, we select an appropriate surrogate country by determining whether
an economically comparable country is a significant producer of
comparable merchandise and whether the data for valuing FOPs are both
available and reliable.
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\18\ See Memorandum titled ``Request for a List of Surrogate
Countries for an Administrative Review of the Antidumping Duty Order
on Chlorinated Isocyanurates (``CLI'') from the People's Republic of
China (``China''),'' dated September 9, 2011 (Surrogate Country
Memorandum).
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Petitioners, in their December 19, 2011 comments on surrogate
country selection, recommended that the Department select South Africa
as the primary surrogate country, as South Africa is economically
comparable to the PRC, is a significant producer of calcium
hypochlorite, a comparable product identified in previous segments, and
is likely to have reliable surrogate value data for most or all of the
key FOPs. Petitioners also noted that Thailand may be a significant
producer of other hypochlorites. Arch Chemicals, Inc., an interested
party in this review, in its December 19, 2011 comments on surrogate
country selection, states the Department should expand its definition
of comparable merchandise to include sodium hypochlorite as there are
financial statements for a sodium hypochlorite producer in the
Philippines, and there are likely to be financial statements from
sodium hypochlorite producers in Thailand as well. Also on December 19,
2011, Kangtai suggested using either the
[[Page 41748]]
Philippines or Thailand as a surrogate country, since chloro alkali
industries appear to be active in either country. Additionally,
Petitioners, Jiheng and Kangtai each put data on the record of this
proceeding to value FOPs from South Africa, the Philippines and
Thailand on January 9, 2012, and provided rebuttal surrogate country
comments on January 17, 2012.
Economic Comparability
As explained in the Surrogate Country Memorandum, the Department
considers Colombia, Indonesia, the Philippines, South Africa, Thailand
and Ukraine equally comparable to the PRC in terms of economic
development. Therefore, we consider all six countries as having
satisfied this prong of the surrogate country selection criteria.
Accordingly, unless we find that all of the countries determined to be
equally economically comparable are not significant producers of
comparable merchandise, do not provide a reliable source of publicly
available surrogate data or are unsuitable for other reasons, we rely
on data from one of these countries.
Significant Producers of Identical or Comparable Merchandise
Section 773(c)(4)(B) of the Act requires the Department to value
FOPs in a surrogate country that is a significant producer of
comparable merchandise. Neither the statute nor the Department's
regulations provide further guidance on what may be considered
comparable merchandise. Given the absence of any definition in the
statute or regulations, the Department looks to other sources such as
Policy Bulletin 04.1 for guidance on defining comparable
merchandise.\19\ Policy Bulletin 04.1 states that ``the terms
`comparable level of economic development,' `comparable merchandise,'
and `significant producer' are not defined in the statute.'' \20\
Policy Bulletin 04.1 further states that ``in all cases, if identical
merchandise is produced, the country qualifies as a producer of
comparable merchandise.'' \21\ Conversely, if identical merchandise is
not produced, then a country producing comparable merchandise is
sufficient in selecting a surrogate country.\22\ Further, when
selecting a surrogate country, the statute requires the Department to
consider the comparability of the merchandise, not the comparability of
the industry.\23\ ``In cases where the identical merchandise is not
produced, the Department must determine if other merchandise that is
comparable is produced.'' \24\
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\19\ See the Department's Policy Bulletin No. 04.1, ``Non-Market
Economy Surrogate Country Selection Process,'' (March 1, 2004)
(Policy Bulletin 04.1), available on the Department's Web site at
http://ia.ita.doc.gov/policy/bull04-1.html.
\20\ See Policy Bulletin 04.1.
\21\ Id.
\22\ Policy Bulletin 04.1 also states that ``if considering a
producer of identical merchandise leads to data difficulties, the
operations team may consider countries that produce a broader
category of reasonably comparable merchandise.'' Id. at note 6.
\23\ See Sebacic Acid from the People's Republic of China: Final
Results of Antidumping Duty Administrative Review, 62 FR 65674
(December 15, 1997) and accompanying Issues and Decision Memorandum
at Comment 1 (to impose a requirement that merchandise must be
produced by the same process and share the same end uses to be
considered comparable would be contrary to the intent of the
statute).
\24\ See Policy Bulletin 04.1, at 2.
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Further, the statute grants the Department discretion to examine
various data sources for determining the best available
information.\25\ The legislative history also states that ``the term
``significant producer'' includes any country that is a significant net
exporter and, if appropriate, Commerce may use a significant, net
exporting country in valuing factors,'' \26\ and it does not preclude
reliance on additional or alternative metrics. The record developed to
date for these preliminary results of review does not contain
information with respect to production volumes of identical or
comparable merchandise in the potential surrogate countries. Therefore,
in evaluating which countries on the list may be significant producers
of identical or comparable merchandise, the Department examined data
for the POR from the Global Trade Atlas (GTA) for HTSUS 2933.69, the
primary HTSUS number included in the scope of the order. An evaluation
of the GTA data indicates that none of the countries listed in the
Surrogate Country Memorandum were likely producers of identical
merchandise.\27\ Next, the Department examined whether the surrogate
countries on the list were significant producers of comparable
merchandise as provided by section 773(c)(4)(B) of the Act. In the
investigation of chlorinated isos, the Department found that calcium
hypochlorite was comparable to the subject merchandise because it has
``similar physical characteristics, end uses, and production
processes.'' \28\ Because, as mentioned above, the record contains no
production data for calcium hypochlorite in any of the possible
surrogate countries, the Department turned to the GTA export data under
HTS 2828.10, for calcium hypochlorite. South Africa was, by far, the
largest exporter of calcium hypochlorite among the countries listed in
the Surrogate Country Memorandum. The remaining countries on the list
have less than 200,000 kilograms and most have less than 100,000
kilograms while South Africa has 3.8 million kilograms. Therefore, the
Department is selecting South Africa as the primary surrogate country.
The Department will continue to evaluate any additional evidence timely
placed on the record that other countries on the surrogate country list
produce identical or comparable merchandise, and whether there are
other types of merchandise produced in the surrogate countries on the
list that could be considered comparable to chlorinated isos.
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\25\ See section 773(c) of the Act and Nation Ford Chem. Co. v.
United States, 166 F.3d 1373, 1377 (Fed. Cir. 1990).
\26\ See Conference Report to the 1988 Omnibus Trade &
Competitiveness Act, H.R. Conf. Rep. No. 576,100 Cong, 2d Sess.
(1988), reprinted in Cong. Rec. H2032 (Daily Ed. April 20, 1988).
\27\ See Preliminary Surrogate Value Memorandum.
\28\ See Notice of Final Determination of Sales at Less Than
Fair Value: Chlorinated Isocyanurates From the People's Republic of
China, 70 FR 24502 (May 10, 2005) and accompanying Issues and
Decision Memorandum at Comment 2.
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Data Availability
When evaluating surrogate value data, the Department considers
several factors including whether the surrogate value is publicly
available, contemporaneous with the POR, from an approved surrogate
country, tax and duty-exclusive, and specific to the input, and
represents a broad market average. There is no hierarchy among these
criteria; it is the Department's practice to carefully consider the
available evidence in light of the particular facts of each industry
when undertaking its analysis.\29\ The record of this review does
contain data for South Africa and Thailand, as well as some data for
the Philippines. As noted above, because South Africa is a significant
producer of comparable merchandise, and because there is data on the
record from South Africa to value FOPs, we have preliminarily
determined for purposes of these preliminary results that South Africa
is the most appropriate surrogate country to use in this review, and,
accordingly, have calculated NV using South African prices to value the
respondents' FOPs, when available and appropriate (see discussion below
regarding why certain data from South Africa would likely provide
inaccurate surrogate values for some FOPs).\30\ We
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have obtained and relied upon publicly available information wherever
possible.
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\29\ See Policy Bulletin 04.1.
\30\ See Preliminary Surrogate Value Memorandum.
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The Surrogate Country Memorandum further explains that the list of
countries it provides is a ``non-exhaustive'' list of potential
surrogate countries. Furthermore, it states that
You may also consider other countries on the case record if the
record provides you adequate information to evaluate them. You may
be unable to obtain the necessary factor price information in a
suitable surrogate country. If that is the case, you will have to
rely on the price of comparable merchandise that is produced in a
surrogate country and sold in other countries, including the United
States.
Since acceptable data sources for certain inputs have not been placed
on the record from any of the countries provided in the Surrogate
Country Memorandum, for a limited number of FOPs, the Department must
rely on alternative countries as sources of surrogate data.\31\ In this
review, the only alternative data on the record for these FOPs is from
India. These data were placed on the record by interested parties or
were obtained from the record of the previous review in these
proceedings. Even though India is not on the list of possible surrogate
countries provided in the Surrogate Country Memorandum, India is a
significant producer of comparable merchandise that has the data needed
to calculate certain surrogate values.\32\ Accordingly, where data from
South Africa was not available, Indian data was used.
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\31\ Section 773(c)(4)(A) of the Act states that the Department
shall value FOPs using prices in a country economically comparable
to the NME country ``to the extent possible.'' As stated in the
Department's Policy Bulletin 04.1, ``Non-Market Economy Surrogate
Country Selection Process,'' ``Limited data availability sometimes
is the reason why the team will ``go off'' the OP list in search of
a viable primary surrogate country.''
\32\ See Preliminary Surrogate Value Memorandum.
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Indian data was used in the following circumstances. First, there
are no acceptable financial statements from any of the potential
surrogate countries on the record of this review for identical or
comparable merchandise. Petitioner submitted a contemporaneous
financial statement from an Indian company that the Department has
previously used to calculate financial ratios. Therefore, based on the
record of this review and the guidance provided in the Surrogate
Country Memorandum,\33\ the Department is using financial statements
from an Indian company to calculate the financial ratios. There are
also several chemical inputs that are valued using specific
concentration levels that cannot be obtained from GTA data for South
Africa.\34\ Petitioners did place on the record data by concentration
level for one input, sulfuric acid, from a South African chemical
producer on the record, but because no information has been placed on
the record of this review to value the remaining inputs using specific
concentration levels, the Department is selecting data from the Indian
publication, Chemical Weekly, used in the previous review of this
order.\35\ The Department has previously determined that several inputs
are not frequently traded internationally and face special concerns
both in transporting and in packaging, such that GTA data cannot be
used.\36\ The Department is therefore using data from Indian financial
statements placed on the record of the previous review to value these
specific inputs, as no data was placed on the record from any country
listed in the Surrogate Country Memorandum. Finally, South Africa does
not have labor rates from Chapter 6A: Labor Cost in Manufacturing, of
the International Labor Organization (ILO) Yearbook of Labor Statistics
(Yearbook), which the Department has determined to be the best source
of data when valuing the labor input. India does have labor rates from
Chapter 6A, so we are using Indian data to value labor as well. As
explained below under ``Factor Valuations,'' the Department has
inflated non-contemporaneous data to the POR.
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\33\ See Policy Bulletin 04.1, which states that the Department
``may also consider other countries on the case record if the record
provides you adequate information to evaluate them.''
\34\ See Memorandum titled ``Preliminary Results of the 2009-
2010 Administrative Review of the Antidumping Duty Order on
Chlorinated Isocyanurates from the People's Republic of China:
Surrogate Value Memorandum,'' dated June 30, 2011 (2009-2010
Surrogate Value Memorandum).
\35\ See Preliminary Surrogate Value Memorandum. See also 2009-
2010 Surrogate Value Memorandum.
\36\ See 2009-2010 Surrogate Value Memorandum.
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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 these preliminary results.\37\
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\37\ 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, e.g., 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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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 AD
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.
In the Initiation Notice, the Department notified parties of the
process by which exporters and producers may obtain separate rate
status. This process requires exporters and producers wishing to
qualify for separate rate status in this administrative review to
complete, as appropriate, either a separate rate application or
certification.\38\ In particular, companies for which a review was
requested, and which were assigned a separate rate in the most recent
segment of the same proceeding in which they participated, need to
certify that they continue to meet the criteria for obtaining a
separate rate.\39\ For companies that have not previously been assigned
a separate rate, the companies must submit a separate rate application
demonstrating eligibility for a separate rate.
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\38\ See Initiation Notice, 75 FR at 44224.
\39\ See Tapered Roller Bearings and Parts Thereof, Finished or
Unfinished, from the People's Republic of China: Final Results of
2005-2006 Administrative Review and Partial Rescission of Review, 72
FR 56724 and accompanying Issues and Decision Memorandum at Comment
2; upheld by Peer Bearing Company--Changshan v. United States, 587
F. Supp. 2d 1319, 1324-25 (CIT 2008).
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Kangtai and Nanning were assigned a separate rate in the most
recent segment of this proceeding in which they participated,\40\ and
they timely certified in this administrative review that they continue
to meet the criteria for obtaining a separate rate. In addition, Jiheng
and Zhucheng timely filed separate rate applications.\41\
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\40\ See Kangtai Final Results and Notice of Final Determination
of Sales at Less Than Fair Value: Chlorinated Isocyanurates From the
People's Republic of China, 70 FR 24502 (May 10, 2005).
\41\ See Jiheng's September 26, 2011 submission, Nanning's
September 26, 2011 submission, Zhucheng's September 6, 2011 and
October 3, 2011 submission, and Kangtai's October 3, 2011
submission.
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In order to establish independence from the NME entity, exporters
must demonstrate the absence of both de jure and de facto government
control over export activities. The Department
[[Page 41750]]
analyzes each entity exporting the subject merchandise under a test
arising from the Final Determination of Sales at Less Than Fair Value:
Sparklers From the People's Republic of China, 56 FR 20588 (May 6,
1991) (Sparklers), as further developed in Notice of Final
Determination of Sales at Less Than Fair Value: Silicon Carbide From
the People's Republic of China, 59 FR 22585 (May 2, 1994) (Silicon
Carbide). However, if the Department determines that a company is
wholly foreign-owned or located in an ME country, then a separate rate
analysis is not necessary to determine whether it is independent from
government control.
Separate Rate Analysis
Jiheng, Kangtai, Nanning and Zhucheng stated that they are either
joint ventures between Chinese and foreign companies or are wholly
Chinese-owned companies. Thus, the Department has analyzed whether each
of these companies has demonstrated the absence of de jure and de facto
governmental control over their respective export activities.
a. Absence of de Jure Control
The Department considers the following de jure criteria in
determining whether an individual company may be granted a separate
rate: (1) An absence of restrictive stipulations associated with an
individual exporter's business and export licenses; (2) any legislative
enactments decentralizing control of companies; and (3) other formal
measures by the government decentralizing control of companies.\42\
---------------------------------------------------------------------------
\42\ See Sparklers, 56 FR at 20589.
---------------------------------------------------------------------------
The evidence Jiheng, Kangtai, Nanning and Zhucheng provided in
their separate rate certifications and separate rate applications
supports a preliminary finding of absence of de jure government control
based on the following factors: (1) An absence of restrictive
stipulations associated with the individual exporter's business and
export licenses; (2) applicable legislative enactments decentralizing
control of the companies; and (3) formal measures by the government
decentralizing control of PRC companies.
b. Absence of de Facto Control
Typically, the Department considers four factors in evaluating
whether each respondent is subject to de facto government control of
its export functions: (1) Whether the export prices are set by or are
subject to the approval of a government agency; (2) whether the
respondent has authority to negotiate and sign contracts and other
agreements; (3) whether the respondent has autonomy from the government
in making decisions regarding the selection of management; and (4)
whether the respondent retains the proceeds of its export sales and
makes independent decisions regarding disposition of profits or
financing of losses.\43\ 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.
---------------------------------------------------------------------------
\43\ 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 evidence Kangtai and Nanning provided in their separate rate
certifications, and the evidence Jiheng and Zhucheng provided in their
separate rate applications, supports a preliminary finding of absence
of de facto government control based on the following factors: (1) An
absence of restrictive government control on export prices; (2) a
showing of authority to negotiate and sign contracts and other
agreements; (3) a showing that Jiheng, Kangtai, Nanning and Zhucheng
maintain autonomy from the government in making decisions regarding the
selection of management; and (4) a showing that Jiheng, Kangtai,
Nanning and Zhucheng retain the proceeds of their respective export
sales and make independent decisions regarding disposition of profits
or financing of losses.
Ultimately, the evidence placed on the record of this
administrative review by Jiheng, Kangtai, Nanning and Zhucheng
demonstrates an absence of de jure and de facto government control, in
accordance with the criteria identified in Sparklers and Silicon
Carbide. Therefore, the Department has preliminarily granted Jiheng,
Kangtai, Nanning and Zhucheng a separate rate.
Margin for Separate-Rate Companies
As discussed above, the Department received timely and complete
separate rate applications or certifications from Jiheng, Kangtai,
Nanning and Zhucheng, all of which were exporters of chlorinated isos
from the PRC during the POR. Nanning and Zhucheng were not selected to
be individually examined respondents in this review. Through the
evidence in their respective separate rate applications or
certifications, these companies have demonstrated their eligibility for
a separate rate. The statute and the Department's regulations do not
address the establishment of a rate to be applied to individual
companies not selected for examination where the Department limited its
examination in an administrative review pursuant to section 777A(c)(2)
of the Act. Generally, we have looked to section 735(c)(5) of the Act,
which provides instructions for calculating the all-others rate in an
investigation, for guidance when calculating the rate for respondents
we did not examine in an administrative review. For the exporters
subject to a review that were determined to be eligible for separate
rate status, but were not selected as mandatory respondents, the
Department generally weight-averages the rates calculated for the
mandatory respondents, excluding any rates that are zero, de minimis,
or based entirely on facts available.\44\ For one of the mandatory
respondents, Kangtai, we have calculated a rate of zero for these
preliminary results of review. Therefore, the Department is assigning
to the separate rate companies the only rate calculated in this review
that is not zero, de minimis, or based entirely on facts available.
Accordingly, we are assigning to the separate rate companies the rate
calculated for Jiheng.\45\
---------------------------------------------------------------------------
\44\ See, e.g., Wooden Bedroom Furniture From the People's
Republic of China: Preliminary Results of Antidumping Duty
Administrative Review, Preliminary Results of New Shipper Review and
Partial Rescission of Administrative Review, 73 FR 8273, 8279
(February 13, 2008) (unchanged in Wooden Bedroom Furniture from the
People's Republic of China: Final Results of Antidumping Duty
Administrative Review and New Shipper Review, 73 FR 49162 (August
20, 2008)).
\45\ See Memorandum titled ``Preliminary Results Surrogate Value
Memorandum,'' dated June 29, 2012. See also Multilayered Wood
Flooring From the People's Republic of China: Final Determination of
Sales at Less Than Fair Value, 76 FR 64318 (October 18, 2011).
---------------------------------------------------------------------------
Date of Sale
We preliminarily determine that the invoice date is the most
appropriate date to use as the date of sale for both respondents in
accordance with 19 CFR 351.401(i). In this regard, no interested
parties provided evidence indicating that the material terms of sale
were established on another date. Instead, according to the
respondents' questionnaire responses, the material terms of the sale
are fixed at invoice date. Thus, the Department finds that the invoice
date is the date of sale. Evidence on the record also demonstrates
that, with respect to Jiheng's sales to the United States, for some
sales the shipment date occurs prior to the invoice date.\46\ In such
[[Page 41751]]
cases, we limit the date of sale to no later than shipment date.\47\
---------------------------------------------------------------------------
\46\ See Jiheng's November 29, 2011 questionnaire response at
13.
\47\ See, e.g., Narrow Woven Ribbons with Woven Selvedge from
the People's Republic of China: Preliminary Determination of Sales
at Less Than Fair Value and Postponement of Final Determination, 75
FR 7244, 7251 (February 18, 2010), unchanged in Narrow Woven Ribbons
With Woven Selvedge From the People's Republic of China: Final
Determination of Sales at Less Than Fair Value, 75 FR 41808 (July
19, 2010).
---------------------------------------------------------------------------
Fair Value Comparisons
To determine whether sales of chlorinated isos to the United States
by Jiheng and Kangtai 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.\48\
---------------------------------------------------------------------------
\48\ 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 Proceedings: Final
Modification, 77 FR 8101 (February 14, 2012) (Final Modification for
Reviews). 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.
---------------------------------------------------------------------------
Export Price
Jiheng and Kangtai 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 and Kangtai. To this price,
we added amounts for components that were supplied free of charge
(Jiheng and Kangtai) or for which the respondent was separately
reimbursed by the customer (Jiheng), where applicable, pursuant to
section 772(c)(1)(A) of the Act and consistent with our treatment of
Jiheng's sales in prior reviews.\49\ For free raw materials and packing
materials, we added the surrogate values for these materials,
multiplied by the reported FOPs for these items, to the U.S. price paid
by Jiheng's or Kangtai's customer.\50\ The reimbursed raw materials
were always listed separately on sales invoices, and were not included
in the U.S. prices reported by Jiheng.\51\ Since these reimbursed items
were raw materials, we added the amount paid by the U.S. customer for
these materials to the U.S. price.
---------------------------------------------------------------------------
\49\ See Memoranda titled ``Analysis for the Preliminary Results
of the 2010-2011 Administrative Review of Chlorinated Isocyanurates
from the People's Republic of China: Hebei Jiheng Chemical Company
Ltd.,'' and ``Analysis for the Preliminary Results of the 2010-2011
Administrative Review of Chlorinated Isocyanurates from the People's
Republic of China: Juancheng Kangtai Chemical Co., Ltd.'' (Kangtai
Preliminary Analysis Memorandum) dated June 29, 2012.
\50\ 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.
\51\ See Jiheng's November 29, 2011 questionnaire response at
20.
---------------------------------------------------------------------------
Normal Value
Section 773(c)(1) of the Act provides that, in an NME proceeding,
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 bases 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 the
Department's 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 consumed; (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 FOPs for various
materials provided free of charge or reimbursed by the 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 an ME country and pays for this input
in an ME currency, the Department may value the factor using the actual
price paid for this input.\52\ Jiheng and Kangtai both reported that
they did not purchase any inputs from ME suppliers for the production
of the subject merchandise.\53\
---------------------------------------------------------------------------
\52\ See 19 CFR 351.408(c)(1); see also Shakeproof Assembly
Components, Div. of Illinois Tool Works, Inc. v. United States, 268
F.3d 1376, 1382-1383 (Fed. Cir. 2001) (affirming the Department's
use of market-based prices to value certain FOPs).
\53\ See Jiheng's November 29, 2011 Section D response at D-12
and Kangtai's November 28, 2011 Section D response at 7.
---------------------------------------------------------------------------
With regard to the South African import-based surrogate values, we
have disregarded prices that we have reason to believe or suspect may
be subsidized, such as those imports from India, 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.\54\ 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.\55\ Rather, the Department bases 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 South African import-based surrogate
values. Additionally, we disregarded prices from NME countries.\56\
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.
---------------------------------------------------------------------------
\54\ 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,
62957 (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, 1339 (CIT 2003), affirmed 104 Fed. Appx. 183 (Fed. Cir.
2004).
\55\ See H.R. Rep. No. 100-576 (1988), at 590.
\56\ The list of excluded NME countries includes: Armenia,
Azerbaijan, Belarus, Georgia, Kyrgyzstan, Moldova, the PRC,
Tajikistan, Turkmenistan, Uzbekistan, and Vietnam.
---------------------------------------------------------------------------
Factor Valuations
In accordance with section 773(c) of the Act, we calculated NV
based on the FOPs reported by Jiheng and Kangtai for the POR. To
calculate NV, we multiplied the reported per-unit factor quantities by
publicly available South African 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 the import surrogate values a
[[Page 41752]]
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).\57\
---------------------------------------------------------------------------
\57\ For a detailed description of all surrogate values used for
Jiheng and Kangtai, see Preliminary Surrogate Value Memorandum.
---------------------------------------------------------------------------
Except as noted below, we valued raw material inputs using the
weighted-average unit import values as reported by the South African
Revenue Service in GTA.\58\ 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
South African Consumer Price Index as published in the International
Financial Statistics of the International Monetary Fund,\59\ or the
Indian Wholesale Price Indexes as published by the Office of the
Economic Advisor to the Government of India.\60\ We further adjusted
these prices to account for freight expenses incurred between the input
supplier and respondent.
---------------------------------------------------------------------------
\58\ Available at http://www.gtis.com/gta/.
\59\ A wholesale price index was not available for Thailand.
\60\ See Preliminary Surrogate Value Memorandum.
---------------------------------------------------------------------------
To value calcium chloride, barium chloride, zinc sulfate, we used
Chemical Weekly data because South African import data by concentration
level was unavailable in the GTA. We adjusted these values for taxes
and to account for freight expenses incurred between the supplier and
the respondent. We inflated the data to make it contemporaneous with
the POR.\61\
---------------------------------------------------------------------------
\61\ Id.
---------------------------------------------------------------------------
To value sulfuric acid, the Department used a price list placed on
the record by Petitioners for a South African chemical company called
Norceline Chemicals Suppliers. The prices for sulfuric acid are for one
specific concentration level, packaged two different ways. The
Department took an average of the price, and, because the data is
contemporaneous with the POR, we did not inflate the value.
As noted above, Jiheng and Kangtai reported that a U.S. customer
provided certain raw materials and packing materials free of charge.
Raw materials and packing materials that are provided free of charge to
a respondent by its customer and materials for which a respondent is
separately reimbursed by its customer are part of the cost of
manufacturing, and must be included when calculating NV. Thus, for
Jiheng's and Kangtai's products that included raw materials and packing
materials provided free of charge, 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.\62\ We also added the built-up costs for the raw materials
for which Jiheng was reimbursed by a U.S. customer to NV. Where
applicable, we also adjusted these values to account for freight
expenses incurred between the nearest port of entry and Jiheng's
plants.\63\
---------------------------------------------------------------------------
\62\ 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,
and accompanying Issues and Decision Memorandum at Comment 17.
\63\ See Preliminary Surrogate Value Memorandum.
---------------------------------------------------------------------------
Because water was used by the respondents in the production of
chlorinated isos, the Department considers water to be a direct
material input rather than part of overhead. We valued water using data
from the city of Johannesburg's ``Amendment of Tariff Charges for Water
for Water Services,'' Annexure ``A'', with tariffs effective July 1,
2010. We did not inflate this rate since it is contemporaneous with the
POR.\64\
---------------------------------------------------------------------------
\64\ Available at: http://www.boi.go.th/index.php?page=utility_costs; see also Preliminary Surrogate Value Memorandum.
---------------------------------------------------------------------------
For packing materials, we used the per-kilogram values obtained
from the GTA and made adjustments to account for freight expense
incurred between the PRC supplier and the respondents' plants.\65\
---------------------------------------------------------------------------
\65\ See Preliminary 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 explained
how by-products are produced during the manufacture of chlorinated isos
and has appropriately supported its claim that a by-product offset to
NV should be granted. We valued ammonia gas and sulfuric acid using GTA
and Norceline Chemicals Suppliers price list data, respectively. The
Department determined in the previous review that chlorine and hydrogen
are rarely traded via ocean transport on an international basis, and
used Indian financial statements to provide more representative values
for chlorine and hydrogen gas.\66\ In the instant review, the
Department is using data from financial statements placed on the record
of the last review to value chlorine and hydrogen. Since this data is
not contemporaneous with the POR, we inflated it using the wholesale
price index from India.\67\
---------------------------------------------------------------------------
\66\ See Chlorinated Isocyanurates From the People's Republic of
China: Preliminary Results of Antidumping Duty Administrative
Review, 76 FR 40690 (July 11, 2011).
\67\ See Preliminary Surrogate Value Memorandum.
---------------------------------------------------------------------------
Kangtai reported ammonium sulfate as a by-product in the production
of subject merchandise. However, the Department has found that ammonium
sulfate is not a by-product of the chlorinated isos production
process.\68\ The production process does yield ammonia gas and sulfuric
acid as by-products, which can be further produced to make ammonium
sulfate. The Department adjusted Kangtai's reported ammonium sulfate
by-product to calculate an ammonia gas and sulfuric acid by-
product.\69\ We valued the by-products using GTA and Norceline
Chemicals Suppliers price list data.
---------------------------------------------------------------------------
\68\ See Chlorinated Isocyanurates from the People's Republic of
China: Final Results of Antidumping Duty Administrative Review, 73
FR 52645 (September 10, 2008) and accompanying Issues and Decision
Memorandum at Comment 6.
\69\ See Kangtai Preliminary Analysis Memorandum for details on
these calculations.
---------------------------------------------------------------------------
For electricity, we used data from a South African electric public
utility, Eskom. We used an average of the tariff rates for a
``Megaflex'' consumer, which is for time of use electricity for an
urban consumer, able to shift load, with a maximum demand of greater
than one megavolt ampere, which appears to be the tariff category that
most closely matches the category our respondents would be classified
in. These electricity rates represent publicly-available information on
tax-exclusive electricity rates charged to industries in South
Africa.\70\
---------------------------------------------------------------------------
\70\ Id.
---------------------------------------------------------------------------
On June 21, 2011, the Department revised its methodology for
valuing the labor input in NME AD proceedings.\71\ In Labor
Methodologies, the Department determined that the best methodology to
value the labor input is to use industry-specific labor rates from the
primary surrogate country. Additionally, the Department determined that
the best data source for industry-specific labor rates is Chapter 6A of
the Yearbook.
---------------------------------------------------------------------------
\71\ See Antidumping Methodologies in Proceedings Involving Non-
Market Economies: Valuing the Factor of Production: Labor, 76 FR
36092 (June 21, 2011) (Labor Methodologies).
---------------------------------------------------------------------------
The Department valued labor in this review using the methodology
described
[[Page 41753]]
in Labor Methodologies. Specifically, to value the respondents' labor,
because South Africa does not report labor rates in Chapter 6A of the
Yearbook, the Department relied on data reported by India to the ILO in
Chapter 6A of the Yearbook. The Department further finds the two-digit
description under ISIC-Revision 3 (Manufacture of Chemicals and
Chemical Products) to be the best available information on the record
because it is specific to the industry being examined, and is therefore
derived from industries that produce comparable merchandise. This is
the same classification used in the prior review of this case.
Accordingly, relying on Chapter 6A of the Yearbook, the Department
calculated the labor input using labor data reported by India to the
ILO under Sub-Classification 24 of the ISIC-Revision 3 standard, in
accordance with section 773(c)(4) of the Act. Because these rates were
in effect before the POR, we are adjusting the average value for
inflation.\72\
---------------------------------------------------------------------------
\72\ See Preliminary Surrogate Value Memorandum.
---------------------------------------------------------------------------
As stated above, the Department used India ILO data reported under
Chapter 6A of the Yearbook, which reflects all costs related to labor,
including wages, benefits, housing, training, etc. Since the financial
statements used to calculate the surrogate financial ratios include
itemized detail of indirect labor costs, the Department made
adjustments to the surrogate financial ratios.\73\
---------------------------------------------------------------------------
\73\ See Labor Methodologies and Preliminary Surrogate Value
Memorandum for details of adjustments.
---------------------------------------------------------------------------
We valued truck freight using an average of truck freight costs as
reported in a July 2008 working paper titled ``Transport Prices and
Costs in Africa: A Review of the Main International Corridors,''
published by the International Bank for Reconstruction and Development/
World Bank and a short-haul freight contract for transportation
services in South Africa from October 2011. Since both sources were
dated outside the POR, we inflated or deflated them to reach a rate
contemporaneous with the POR.\74\
---------------------------------------------------------------------------
\74\ See Preliminary Surrogate Value Memorandum.
---------------------------------------------------------------------------
Financial Ratios
As discussed above, there are no financial statements from South
Africa on the record of this review, and the Department could not find
any financial statements from South African companies producing
identical or comparable merchandise.\75\ To calculate surrogate values
for factory overhead, selling, general, and administrative expenses
(SG&A), and profit for these preliminary results, we used financial
information from Kanoria Chemicals & Industries Limited (an Indian
producer of comparable merchandise--stable bleaching powder) for the
fiscal year ending March 31, 2011.\76\ From this information, we were
able to determine average factory overhead as a percentage of the total
raw materials, labor, and energy (ML&E), 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.\77\
---------------------------------------------------------------------------
\75\ See id.
\76\ See Preliminary Surrogate Value Memorandum for a discussion
on the selection of financial statements to value financial ratios.
\77\ See Preliminary Surrogate Value Memorandum.
---------------------------------------------------------------------------
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 dumping margins
exist:
------------------------------------------------------------------------
Weight-average
Exporter margin
percentage
------------------------------------------------------------------------
Hebei Jiheng Chemical Co., Ltd.......................... 82.29
Juancheng Kangtai Chemical Co., Ltd..................... 0.00
Nanning Chemical Industry Co., Ltd...................... 82.29
Zhucheng Taisheng Chemical Co., Ltd..................... 82.29
------------------------------------------------------------------------
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 after the publication date of the final
results of this review. If a respondent's weighted-average dumping
margin is above de minimis in the final results of this review, we will
calculate an importer specific (or customer-specific, if the importer
is unknown) assessment rate on the basis of the ratio of the total
amount of antidumping duties calculated for the importer's examined
sales and the total entered value for those sales in accordance with 19
CFR 351.212(b)(1).\78\
---------------------------------------------------------------------------
\78\ In these preliminary results, the Department applied the
assessment rate calculation method adopted in Final Modification for
Reviews, i.e., on the basis of monthly average-to-average
comparisons using only the transactions associated with that
importer with offsets being provided for non-dumped comparisons.
---------------------------------------------------------------------------
Where an importer-specific (or customer-specific) ad valorem rate
is zero or de minimis, we will instruct CBP to liquidate appropriate
entries without regard to antidumping duties.\79\ For the companies
receiving a separate rate that were not selected for individual review,
we will assign an assessment rate based on the average of the weighted-
average dumping margins we calculated for the mandatory respondents
whose rate were not de minimis, as discussed above. We intend to
instruct CBP to liquidate entries containing subject merchandise
exported by the PRC-wide entity at the PRC-wide rate.
---------------------------------------------------------------------------
\79\ See 19 CFR 351.106(c)(2).
---------------------------------------------------------------------------
Cash Deposit Requirements
The following cash deposit requirements will be effective upon
publication of the final results of this administrative review for 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 the exporter's
listed above, the cash deposit rate will be the rate established in the
final results of this review (except, if the rate is zero or de
minimis, i.e., less than 0.5 percent, a zero cash deposit rate will be
required for that company); (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 eligible for a
separate rate, the cash deposit rate will be the PRC-wide rate of
285.63 percent; \80\ 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.
---------------------------------------------------------------------------
\80\ For an explanation on the derivation of the PRC-wide rate,
see Notice of Final Determination of Sales at Less Than Fair Value:
Chlorinated Isocyanurates From the People's Republic of China, 70 FR
at 24505.
---------------------------------------------------------------------------
Disclosure and Public Comment
We will disclose the calculations used in our analysis to parties
to this proceeding within five days of the publication date of this
notice, in accordance with 19 CFR 351.224(b).
[[Page 41754]]
Interested parties are invited to comment on the preliminary results.
The schedule for filing case briefs will be provided to parties at a
later date. Rebuttal briefs, limited to issues raised in case briefs,
may be filed no later than five days after the time limit for filing
the case briefs, as specified by 19 CFR 351.309(d). The Department
requests that parties submitting case or rebuttal briefs provide an
executive summary and a table of authorities as well as an electronic
copy.
Any interested party may request a hearing within 30 days of
publication of this notice, as provided by 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 case 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.
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 comments, within 120 days of publication of
these preliminary results, pursuant to section 751(a)(3)(A) of the Act,
unless otherwise extended.
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 Department'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: June 29, 2012.
Paul Piquado,
Assistant Secretary for Import Administration.
[FR Doc. 2012-17314 Filed 7-13-12; 8:45 am]
BILLING CODE 3510-DS-P