```

[Federal Register Volume 69, Number 247 (Monday, December 27, 2004)]
[Notices]
[Pages 77184-77195]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-28119]

[[Page 77184]]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-863]

Honey From the People's Republic of China: Preliminary Results, 
Partial Rescission, and Extension of Final Results of Second 
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 the second 
administrative review of the antidumping duty order on honey from the 
People's Republic of China (``PRC''). The period of review (``POR'') is 
December 1, 2002 through November 30, 2003. Petitioners issued a timely 
withdrawal of their request for an administrative review for two 
companies named in the initiation of this review; consequently, we 
rescinded our review of these companies. In addition, we rescinded our 
review of five companies because they are participating in new shipper 
reviews covering the periods December 1, 2002 through May 31, 2003, or 
December 1, 2002, through November 30, 2003. Another company had no 
exports or sales of the subject merchandise during the POR; therefore, 
we are preliminarily rescinding our review of this company. We 
preliminarily determine that three companies have failed to cooperate 
by not acting to the best of their ability to comply with our requests 
for information and, as a result, should be assigned a rate based on 
adverse facts available. Finally, we have preliminarily determined that 
five respondents made sales to the United States of the subject 
merchandise at prices below normal value.
    We invite interested parties to comment on these preliminary 
results. Parties that submit comments are requested to submit with each 
argument (1) a statement of the issue and (2) a brief summary of the 
argument(s).

DATES: Effective Date: December 27, 2004.

FOR FURTHER INFORMATION CONTACT: Anya Naschak, Kristina Boughton, or 
Bobby Wong at (202) 482-6375, (202) 482-8173, or (202) 482-0409, 
respectively; AD/CVD Operations, Office 9, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue, NW., Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Background

    On December 2, 2003, the Department published a Notice of 
Opportunity to Request an Administrative Review of Antidumping or 
Countervailing Duty Order, Finding, or Suspended Investigation, 68 FR 
67401 (December 2, 2003). On December 29, 2003, Anhui Honghui Foodstuff 
(Group) Co., Ltd. (``Anhui Honghui''); Eurasia Bee's Products Co., Ltd. 
(``Eurasia''); Jiangsu Kanghong Natural Healthfoods Co., Ltd. 
(``Jiangsu Kanghong''); Inner Mongolia Autonomous Region Native Produce 
and Animal By-Products Import & Export Corp. (``Inner Mongolia''); 
Jinfu Trading Co., Ltd. (``Jinfu''); Shanghai Eswell Enterprise Co., 
Ltd. (``Eswell''); Shanghai Shinomiel International Trade Corporation 
(``Shanghai Shinomiel''); and Wuhan Bee Health Company, Ltd. (``Wuhan 
Bee''), requested that the Department conduct an administrative review 
of each respective company's entries during the POR. On December 31, 
2003, Sichuan-Dujiangyan Dubao Bee Industrial Co., Ltd. (``Dubao'') 
requested that the Department conduct an administrative review of its 
entries during the POR. Also on December 31, 2003, the American Honey 
Producers Association and the Sioux Honey Association (collectively, 
``petitioners'') requested, in accordance with section 351.213(b) of 
the Department's regulations, an administrative review of entries of 
subject merchandise made during the POR by 20 Chinese producers/
exporters.\1\
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    \1\ The request included: Anhui Honghui, Eurasia, Jiangsu 
Kanghong, Anhui Native Produce Import & Export Corp. (``Anhui 
Native''); Cheng Du Wai Yuan Bee Products Co., Ltd. (``Cheng Du''); 
Foodworld International Club, Ltd. (``Foodworld''); Henan Native 
Produce and Animal By-Products Import & Export Company (``Henan''); 
High Hope International Group Jiangsu Foodstuffs Import & Export 
Corp. (``High Hope''); Inner Mongolia; Inner Mongolia Youth Trade 
Development Co., Ltd. (``Inner Mongolia Youth''); Jinan Products 
Industry Co., Ltd. (``Jinan''); Jinfu; Kunshan Foreign Trade Company 
(``Kunshan''); Native Produce and Animal Import & Export Co. 
(``Native Produce''); Eswell; Shanghai Shinomiel; Shanghai Xiuwei 
International Trading Co., Ltd. (``Shanghai Xiuwei''); Dubao, Wuhan 
Bee; and Zhejiang Native Produce and Animal By-Products Import & 
Export Group Corp. (``Zhejiang'').
---------------------------------------------------------------------------

    On January 14, 2004, petitioners filed a letter withdrawing their 
request for review of Henan, High Hope, Jinan, and Native Produce. On 
January 22, 2004, the Department initiated the review for the remaining 
16 companies. See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Requests for Revocation in Part, 68 FR 3009 
(January 22, 2004) (``Review Initiation''). On January 29, 2004, the 
Department issued antidumping duty questionnaires to the 16 PRC 
producers/exporters of the subject merchandise covered by this 
administrative review.
    On February 13 and February 18, 2004, petitioners withdrew their 
request for review of Foodworld and Anhui Native, respectively. On 
February 24, 2004, Cheng Du stated that all of its direct and indirect 
export sales of honey to the United States during the POR fall within a 
separate new shipper review covering the period December 1, 2002 
through May 31, 2003, and requested that the Department rescind this 
proceeding for Cheng Du. See Honey From the People's Republic of China: 
Initiation of New Shipper Antidumping Duty Reviews, 68 FR 47537 (August 
11, 2003). On February 25, 2004, Inner Mongolia Youth similarly stated 
that the only sale it made during the POR was currently being reviewed 
under another new shipper review, covering the identical period as this 
current administrative review, and requested that the Department 
rescind this administrative review for Inner Mongolia Youth. See Honey 
from the People's Republic of China: Initiation of New Shipper Duty 
Administrative Reviews, 69 FR 5835. On March 5, 2004, Anhui Honghui, 
Eurasia, and Jiangsu Kanghong withdrew their requests for the 
administrative review covering the POR because all of their entries of 
subject merchandise during the POR were also subject to the new shipper 
review covering the identical POR.
    On March 10, 2004, the Department rescinded the administrative 
review for Foodworld and Anhui Native because petitioners had withdrawn 
their review request for these companies. See Honey from the People's 
Republic of China: Notice of Partial Rescission of Antidumping Duty 
Administrative Review, 69 FR 11383 (March 10, 2004).
    On March 12, 2004, petitioners also withdrew their request for an 
administrative review of entries made by Anhui Honghui, Cheng Du, 
Eurasia, Inner Mongolia Youth, and Jiangsu Kanghong. On April 27, 2004, 
the Department rescinded the review for Anhui Honghui, Cheng Du, 
Eurasia, Inner Mongolia Youth, and Jiangsu Kanghong. See Honey from the 
People's Republic of China: Notice of Partial Rescission of Antidumping 
Duty Administrative Review, 69 FR 22760 (April 27, 2004).
    On March 25, 2004, we invited interested parties to comment on the 
Department's surrogate country selection and/or significant production 
in the other potential surrogate countries and to submit publicly 
available information to value the factors of production. On April 15,

[[Page 77185]]

2004, petitioners submitted comments on the selection of the proper 
surrogate country. On May 10, 2004, petitioners and respondents 
submitted comments on surrogate information with which to value the 
factors of production in this proceeding. On May 20, 2004, respondents 
submitted comments on petitioners' submissions for surrogate values.
    With regard to Dubao, Eswell, Jinfu, Wuhan Bee, and Zhejiang, 
between March and December 2004, the Department received timely filed 
original and supplemental questionnaire responses and petitioners' 
comments on those responses.

Inner Mongolia

    We received timely responses from Inner Mongolia to the 
Department's original questionnaire and petitioners commented on these 
submissions. We subsequently issued a supplemental questionnaire to 
Inner Mongolia and received a partial response. The Department then 
received a letter from Inner Mongolia's counsel stating that Inner 
Mongolia was withdrawing its request for an annual review. On June 23, 
2004, the Department issued a letter to Inner Mongolia, noting that 
petitioners have not withdrawn their request for review, that the 
Department is proceeding with the review, and that the Department 
requires Inner Mongolia's continued participation or the Department may 
resort to facts available. The Department received a response from 
counsel for Inner Mongolia, in which Inner Mongolia's counsel stated 
that Inner Mongolia would not be participating in this administrative 
review any further as it was canceling operations, and that counsel was 
no longer representing Inner Mongolia. See Memorandum to the File from 
Steve Williams dated July 1, 2004 (``Shanghai Shinomiel and Inner 
Mongolia Memo'').

Shanghai Xiuwei

    We received timely responses from Shanghai Xiuwei to Sections A, C, 
and D, and petitioners submitted comments on these responses. We issued 
a supplemental questionnaire to Shanghai Xiuwei and received an 
incomplete response. The Department issued a letter to Shanghai Xiuwei, 
requesting for a second time that Shanghai Xiuwei respond completely to 
the Department's supplemental questionnaire as requested, or risk 
application of facts available. Shanghai Xiuwei requested that the 
review be rescinded, as it had been unable to collect certain data from 
its board or its importers to respond to the Department's 
questionnaire. On August 27, 2004, the Department issued another letter 
to Shanghai Xiuwei rejecting its withdrawal request, noting that 
petitioners had not withdrawn their request for review. We received no 
response from Shanghai Xiuwei.

Shanghai Shinomeil

    The Department received no response from Shanghai Shinomiel to its 
original questionnaire. The Department subsequently issued a letter to 
shanghai Shinomeil requesting that it respond to the Department's 
questionnaire as requested, or risk application of adverse facts 
available. In addition, the Department spoke with counsel for Shanghai 
Shinomeil, and Shanghai Shinomeil's counsel informed the Department 
that Shanghai Shinomiel would not be participating in this 
administrative review. See Shanghai Shinomiel and Inner Mongolia Memo.

Kunshan

    The Department received no response from Kunshan to its original 
questionnaire by the deadlines. The Department issued a second request 
to Kunshan to respond to the Department's antidumping questionnaire. 
See Letter from Abdelali Elouaradia to Kunshan Foreign Trade Company, 
dated March 10, 2004. Kunshan notified the Department that it made no 
shipments to the United States during the POR, and requested that the 
Department rescind this administrative review for Kunshan. See Letter 
from Kunshan, to Abdelali Elouaradia (undated). We received no comments 
from any interested parties regarding Kunshan's request for rescission. 
Therefore, because Kunshan had no shipments to the United States during 
the POR, the Department is preliminarily rescinding this administrative 
review for Kunshan. See ``Preliminary partial Rescission of 
Administrative Review'' section, below.
    On June 1, 2004, the Department published an extension of the time 
limits to complete these preliminary results. See Honey from the 
People's Republic of China: Extension of Time Limit of Preliminary 
Results of Second Antidumping Duty Administrative Review, 69 FR 30879 
(June 1, 2004).
    On August 12, 2004, petitioners submitted a letter requesting that 
the Department apply adverse facts available (``AFA'') to Shanghai 
Xiuwei, Inner Mongolia, and Shanghai Shinomiel for the preliminary 
results.
    On October 1, 2004, the Department published an additional 
extension of the time limits to complete these preliminary results. See 
Honey from the People's Republic of China: Extension of time Limit of 
Preliminary Results of Second Antidumping Duty Administrative Review, 
69 FR 58893 (October 1, 2004).
    On November 18, 2004, petitioners submitted comments on the 
valuation of the hone surrogate value and surrogate financial ratios. 
On December 3, 3004, Eswell, Wuhan Bee, and Zhejiang submitted comments 
on the surrogate financial ratios.

Extension of Final Results

    In accordance with section 751(a)(3)(A) of the Act, as amended, we 
determine that it is not practicable to complete this review within the 
original time frame because of the Department's decision to verify 
certain respondents in this review (see ``Verification'' section of 
this notice for further discussion). We are currently unable to conduct 
verification or allow sufficient opportunity for the submission of 
interested party comments, prior to the current final results deadline. 
Thus, in accordance with section 751(a)(3)(A) of the Act and section 
351.213(h)(2) of the Department's regulations, the Department is 
extending the time limit for completion of the final results of this 
review until no later than 150 days from the date of publication of 
this notice.

Scope of the Antidumping Duty Order

    The products covered by this order are natural honey, artificial 
honey containing more than 50 percent natural honey by weight, 
preparations of natural honey containing more than 50 percent natural 
honey by weight, and flavored honey. The subject merchandise includes 
all grades and colors of honey whether in liquid, creamed, comb, cut 
comb, or chunk form, and whether packaged for retail or in bulk form.
    The merchandise subject to this order is currently classifiable 
under subheadings 0409.00.00, 1702.90.90, and 2106.90.99 of the 
Harmonized Tariff Schedule of the United States (``HTSUS''). Although 
the HTSUS subheadings are provided for convenience and customs 
purposes, the Department's written description of the merchandise under 
order is dispositive.

Verification

    As provided in section 782(i)(2) of the Act and 19 CFR 351.307, we 
intend to verify certain information relied upon in making our final 
results. On May 3, 2004, petitioners submitted a request that the 
Department conduct verifications of Inner Mongolia, Jinfu, Eswell, 
Shanghai Xiuwei, Dubao, Wuhan Bee, and Zhejiang. Petitioners noted that 
Inner Mongolia's questionnaire responses have not been verified in any 
of the immediately

[[Page 77186]]

preceding new shipper reviews, and that Eswell has never had its 
information verified. Petitioners state that the remaining respondents 
should be verified pursuant to 19 CFR 351.307(b)(1)(iv), and submitted 
information regarding ``good cause'' related to Jinfu, Shanghai Xiuwei, 
Dubao, Wuhan Bee, and Zhejiang. We intend to verify Dubao and Wuhan 
Bee. However, we do not intend to verify Jinfu, Eswell, and Zhejiang 
because we have not been provided with a sufficient basis to conclude 
that there is ``good cause'' for verification within the meaning of 19 
CFR 351.307(b)(1)(iv), and there have not been two administrative 
reviews without verification within the meaning of 19 CFR 
351.307(b)(1)(v)(B). Additionally, because Shanghai Xiuwei and Inner 
Mongolia have declined to participate in this administrative review, we 
are unable to verify information submitted on the record by these two 
companies. See ``The PRC-wide Rate and Use of Facts Otherwise 
Available'' section below.

Preliminary Partial Rescission of Administrative Review

    Pursuant to 19 CFR 351.213(d)(3), we have preliminarily determined 
that Kunshan made no shipments of subject merchandise to the United 
States during the POR. In making this determination, the Department 
examined PRC honey shipment data maintained by U.S. Customs and Border 
Protection (``CBP''). Based on the information obtained from CBP, we 
found no entries of subject merchandise during the POR manufactured or 
exported by Kunshan to the United States. See also Memorandum to the 
File regarding Entries by Kunshan Foreign Trade Company, dated December 
15, 2004.
    Therefore, based on the results of our CBO query, demonstrating no 
shipments of subject merchandise by Kunshan during the POR, as well as 
Kunshan's claim that it had no subject shipments, we are preliminarily 
rescinding the administrative review, in accordance with 19 CFR 
351.213(d)(3) with respect to Kunshan because we found no evidence that 
Kunshan made shipments of the subject merchandise during the POR.

Separate Rates

    In proceedings involving non-market economy (``NME'') countries, 
the Department begins with a rebuttable presumption that all companies 
within the country are subject to government control and, thus, should 
be assigned a single antidumping duty rate unless an exporter can 
affirmatively demonstrate an absence of government control, both in law 
(de jure) and in fact (de facto), with respect to its export 
activities. In this review Dubao, Eswell, Jinfu, Wuhan Bee, Zhejiang, 
Inner Mongolia, and Shanghai Xiuwei requested separate company-specific 
rates.\2\
---------------------------------------------------------------------------

    \2\ Shanghai Shinomiel did not request a separate rate.
---------------------------------------------------------------------------

    Accordingly, we have considered whether each of the companies is 
independent from government control, and therefore eligible for a 
separate rate. The Department's separate-rate test to determine whether 
the exporters are independent from government control does not 
consider, in general, macroeconomic/border-type controls, e.g., export 
licenses, quotas, and minimum export prices, particularly if these 
controls are imposed to prevent dumping. The test focuses, rather, on 
controls over the investment, pricing, and output decision-making 
process at the individual firm level. See Certain Cut-to-Length Carbon 
Steel Plate from Ukraine: Final Determination of Sales at Less than 
Fair Value, 62 FR 61754, 61757 (November 19, 1997), and Tapered Roller 
Bearings and Parts Thereof, Finished and Unfinished, from the People's 
Republic of China: Final Results of Antidumping Duty Administrative 
Review, 62 FR 61276, 61279 (November 17, 1997).
    To establish whether a firm is sufficiently independent from 
government control of its export activities to be entitled to a 
separate rate, 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 amplified by 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''). In accordance with the 
separate-rates criteria, the Department assigns separate rates in NME 
cases only if respondents can demonstrate the absence of both de jure 
and de facto government control over export activities.
    Dubao, Eswell, Jinfu, Wuhan Bee, Zhejiang (collectively ``fully 
responsive companies'') provided complete separate-rate information in 
their responses to our original and supplemental questionnaires. 
Accordingly, we performed a separate-rates analysis to determine 
whether these exporters are independent from government control.
    As stated above in the ``Background'' section, Inner Mongolia, 
Shanghai Xiuwei, and Shanghai Shinomiel (collectively ``non-responsive 
companies'' did not respond in a complete and timely manner to the 
Department's requests for information and therefore are subject to 
adverse facts available, and no separate-rates analysis is necessary. 
Because these three non-responsive companies did not provide complete 
and verifiable responses to our requests for information regarding 
separate rates, we preliminarily determine that these companies do not 
merit separate rates. See, e.g., Natural Bristle Paint Brushes and 
Brush Heads from the People's Republic of China; Preliminary Results of 
Antidumping Duty Administrative Review, 61 FR 57389 (November 6, 1996). 
Consequently, consistent with the statement in our notice of 
initiation, we find that, because these companies do not qualify for 
separate rates, they are deemed to be part of the PRC-entity. See 
Review Initiation. See also ``The Use of Facts Otherwise Available and 
PRC-wide Rate'' section below.

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 
enactment decentralizing control of companies; and (3) other formal 
measures by the government centralizing control of companies. See 
Sparklers, 56 FR at 20589. As discussed below, our analysis shows that 
the evidence on the record supports a preliminary finding of de jure 
absence of government control for the five fully responsive companies 
based on each of these factors.

Dubao

    Dubao has placed on the record a number of documents to demonstrate 
absence of de jure control, including the ``Regulations of the People's 
Republic of China for Controlling the Registration of Enterprises as 
Legal Persons,'' and the ``Foreign Trade Law of the People's Republic 
of China'' (May 12, 1994) (``Foreign Trade Law ''). See Exhibit 3 of 
Dubao's March 15, 2004, submission (``Dubao Section A''). Dubao also 
submitted a copy of its business license in Exhibit 2 of Dubao Section 
A. This license was issued by the Chengdu Municipal Industrial and 
Commercial Administration. Dubao explains that its business license is 
necessary to register the company. Dubao affirms that its

[[Page 77187]]

business operations are limited to the scope of the license, and that 
the license may be revoked if the company engages in illegal activities 
or if the company is found to have insufficient capital.

Eswell

    Eswell has placed on the record a number of documents to 
demonstrate absence of de jure control, including the ``Company Law of 
the People's Republic of China'' (December 29, 1993) (``Company Law''), 
Foreign Trade Law, and the ``Administrative Regulations of the People's 
Republic of China Governing the Registration of Legal Corporations'' 
(June 3, 1998) (``Legal Corporations Regulations''). See Exhibit 3 of 
Eswell's March 11, 2004, submission (``Eswell Section A''). In 
addition, Eswell placed on the record in Exhibit 6 of its October 29, 
2004, submission the Certificate of Approval for Enterprises with 
Foreign Trade rights in the People's Republic of China (``Foreign Trade 
Rights''). Eswell also submitted a copy of its business license in 
Exhibit 4 of Eswell Section A. This license was issued by the Shanghai 
Industry and Commerce Administrative Bureau. Eswell explains that its 
business license is necessary to register the company. Eswell affirms 
that its business operations are limited to the scope of the license, 
and that the license may be revoked if the company engaged in illegal 
activities or if the company is found to have insufficient capital.

Jinfu

    Jinfu has placed on the record a number of documents to demonstrate 
absence of de jure control, the Company Law, Foreign Trade Law, and the 
Legal Corporations Regulations. See Exhibit 2 of Jinfu's March 11, 
2004, submission (``Jinfu Section A''). Jinfu also submitted a copy of 
its business license in Exhibit 3 of Jinfu Section A. The Suzhou 
Kunshan Industry and Commerce Administrative Bureau issued this 
license. Jinfu explains that the business license defines its business 
scope. Jinfu also affirms that its business operations are limited to 
the scope of the license, and that the license may be revoked if the 
company engages in illegal activities or if the company conducts 
activities outside of the business scope described on its business 
license.

Wuhan Bee

    Wuhan Bee has placed on the record a number of documents to 
demonstrate absence of de jure control, including the Foreign Trade 
Law, the Legal Corporations Regulations, The Law of the People's 
Republic of China: On Chinese-Foreign Joint Ventures (April 13, 1998) 
and the Law of the People's Republic of China on Chinese-Foreign Equity 
Joint Ventures (April 4, 1990). See Exhibit 2 of Wuhan Bee's March 11, 
2004, submission (``Wuhan Bee Section A''). Wuhan Bee also submitted a 
copy of its business license in Exhibit 3 of Wuhan Bee Section A. The 
Industrial and Commercial Administrative Bureau of Wuhan City issued 
this license. Wuhan Bee explains that its business license is necessary 
to register the company and that the license defines the scope of the 
company's business activities and ensures that the company has 
sufficient capital to continue its business operations. Wuhan Bee 
affirms that its business operations are limited to the scope of the 
license, unless amended, and that the license may be revoked if the 
company is found to have insufficient capital or if the company engages 
in activities outside the scope of its business license.

Zhejiang

    Zhejiang has placed on the record a number of documents to 
demonstrate absence of de jure control, including the Company Law, 
Foreign Trade Law, and the Legal Corporations Regulations. See Exhibit 
2 of Zhejiang's March 11, 2004, submission (``Zhejiang Section A''). 
Zhejiang also submitted a copy of its business license in Exhibit 3 of 
Zhejiang Section A. This license was issued by the Industrial and 
Commercial Administrative Bureau of Zhejiang Province on May 17, 2001. 
Zhejiang explains that its business license is necessary to register 
the company. Zhejiang affirms that its business operations are limited 
to the scope of the license, and that the license may be revoked if the 
company engages in illegal activities or if the company is found to 
have insufficient capital.
    We note that three of the five fully responsive companies have 
stated that they are governed by the Company Law, which they claim 
governs the establishment of limited liability companies, and provides 
that such a company shall operate independently and be responsible for 
its own profits and losses. All of the fully responsive companies have 
placed on the record the Foreign Trade Law, and stated that this law 
allows them full autonomy from the central authority in governing their 
business operations. We have reviewed Article 11 of Chapter II of the 
Foreign Trade Law, which states ``foreign trade dealers shall enjoy 
full autonomy in their business operation and be responsible for their 
own profits and losses in accordance with the law.'' As in prior cases, 
we have analyzed such PRC laws and found that they establish an absence 
of de jure control. See, e.g., Pure Magnesium from the People's 
Republic of China: Final Results of New Shipper Review, 63 FR 3085, 
3086 (January 21, 1998) and Preliminary Results of New Shipper Review: 
Certain Preserved Mushrooms From the People's Republic of China, 66 FR 
30695, 30696 (June 7, 2001). Therefore, we preliminarily determine that 
there is an absence of de jure control over the export activities of 
Dubao, Eswell, Jinfu, Wuhan Bee, and Zhejiang.

Absence of De Facto Control

    Typically, the Department considers four factors in evaluating 
whether a respondent is subject to de facto government control of its 
export functions: (1) Whether the export prices are set by, or subject 
to, the approval of a government authority; (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 its 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 at 22587.
    As stated in previous cases, there is some evidence that certain 
enactments of the PRC central government have not been implemented 
uniformly among different sectors and/or jurisdictions in the PRC. See 
Silicon Carbide at 22586-22587. Therefore, 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.
    Dubao has asserted the following: (1) It is a privately owned 
company; (2) there is no government participation in its setting of 
export prices; (3) its sales manager has the authority to bind sales 
contracts; (4) it does not have to notify any government authorities of 
its management selection; (5) there are no restrictions on the use of 
its export revenue; and (6) it is responsible for financing its own 
losses. We have examined the documentation provided and note that it 
does not suggest that pricing is coordinated among exporters of PRC 
honey.
    Eswell has asserted the following: (1) It is a privately owned 
limited liability company; (2) there is no government participation in 
its setting of export prices; (3) the president of its affiliated 
company in the United States or its designated sales agents have the

[[Page 77188]]

authority to bind sales contracts; (4) its management is selected by 
its board of directors and it does not have to notify any government 
authorities of its management selection; (5) there are no restrictions 
on the use of its export revenue; and (6) it is responsible for 
financing its own losses. We have examined the documentation provided 
and note that it does not suggest that pricing is coordinated among 
exporters of PRC honey.
    Jinfu has asserted the following: (1) It is a privately owned 
company; (2) there is no government participation in its setting of 
export prices; (3) its chief executive officer and authorized employee 
have the authority to bind sales contacts; (4) it does not have to 
notify any government authorities of its management selection; (5) 
there are no restrictions on the use of its export revenue; and (6) its 
board of directors decides how profits will be used. We have examined 
the documentation provided and note that it does not suggest that 
pricing is coordinated among exporters of PRC honey.
    Wuhan Bee has asserted the following: (1) It is a joint-venture 
corporation; (2) there is no government participation in its setting of 
export prices; (3) its general manager and its U.S.-based affiliate 
have the authority to bind sales contracts; (4) it does not have to 
notify any government authorities of its management selection; (5) 
there are no restrictions on the use of its export revenue; and (6) its 
board of directors decides how profits will be used. We have examined 
the documentation provided and note that it does not suggest that 
pricing is coordinated among exporters of PRC honey.
    Zhejiang has asserted the following: (1) It is a publicly owned 
company; (2) there is no government participation in its setting of 
export prices; (3) the Manager of the Bee products Department has the 
authority to bind sales contracts; (4) it does not have to notify any 
government authorities of its management selection; (5) there are no 
restrictions on the use of its export revenue; and (6) it is 
responsible for financing its own losses. We have examined the 
documentation provided and note that it does not suggest that pricing 
is coordinated among exporters of PRC honey.
    Consequently, because evidence on the record indicates an absence 
of government control, both in law and in fact, over each respondent's 
export activities, we preliminarily determine that each fully 
responsive company has met the criteria for the application of a 
separate rate.

Use of Facts Otherwise Available and the PRC-Wide Rate

    Dubao, Eswell, Jinfu, Wuhan Bee, Zhejiang, Kunshan, Shanghai 
Xiuwei, Inner Mongolia, and Shanghai Shinomiel were given the 
opportunity to respond to the Department's questionnaire. As explained 
above, we received complete questionnaire responses from Dubao, Eswell, 
Jinfu, Wuhan Bee, and Zhejiang, and we have calculated a separate rate 
for these companies (collectively ``fully responsive companies''). The 
PRC-wide rate applies to all entries of subject merchandise except for 
entries from PRC producers/exporters that have their own calculated 
rate. See ``Separate Rates'' section above.\3\
---------------------------------------------------------------------------

    \3\ Kunshan did not reply to the Department's questionnaire; 
however, based on its request dated march 24, 2004, and the 
Department's analysis of CDP data, we have determined that Kunshan 
had no shipments during the POR and therefore we are preliminarily 
rescinding this review for Kunshan. See ``Partial Rescission'' 
section of this notice.
---------------------------------------------------------------------------

    As discussed above, Shanghai Xiuwei, Inner Mongolia, and Shanghai 
Shinomiel (collectively ``non-responsive companies'') are appropriately 
considered to be part of the PRC-wide entity because they failed to 
establish their eligibility for a separate rate. Furthermore, because 
the PRC-wide entity did not provide information necessary to the 
instant proceeding, it is necessary that we review the PRC-wide entity. 
In doing so, we note that Section 776(a)(1) of the Act mandates that 
the Department use the facts available if necessary information is not 
available on the record of an antidumping proceeding. In addition, 
section 776(a)(2) of the Act provides that if an interested party or 
any other person: (a) Withholds information that has been requested by 
the administering authority; (b) fails to provide such information by 
the deadlines for the submission of the information or in the form and 
manner requested, subject to subsections (c)(1) and (e) of section 782; 
(C) significantly impedes a proceeding under this title; or (D) 
provides such information but the information cannot be verified as 
provided in section 782(i), the Department shall, subject to section 
782(d) of the Act, use the facts otherwise available in reaching the 
applicable determination under this title. Where the Department 
determines that a response to a request for information does not comply 
with the request, section 782(d) of the Act provides that the 
Department shall promptly inform the party submitting the response of 
the nature of the deficiency and shall, to the extent practicable, 
provide that party with an opportunity to remedy or explain the 
deficiency. Section 782(d) further states that if the party submits 
further information that is unsatisfactory or untimely, the 
administering authority may, subject to subsection (e), disregard all 
or part of the original and subsequent responses. Section 782(e) of the 
Act provides that the Department shall not decline to consider 
information that is submitted by an interested party and is necessary 
to the determination but does not meet all the applicable requirements 
established by the administering authority if (1) the information is 
submitted by the deadline established for its submission, (2) the 
information can be verified, (3) the information is not so incomplete 
that it cannot serve as a reliable basis for reaching the applicable 
determination, (4) the interested party has demonstrated that it acted 
to the best of its ability in providing the information and meeting the 
requirements established by the administering authority with respect to 
the information, and (5) the information can be used without undue 
difficulties.
    As addressed below separately for each non-responsive company, we 
find that the PRC-wide entity did not respond to our request for 
information, and necessary information either was not provided, or the 
information provided cannot be verified and is not sufficiently 
complete to enable the Department to use it for these preliminary 
results. Therefore, we find it necessary, under section 776(a)(2) of 
the Act, to use facts otherwise available as the basis for the 
preliminary results of this review for the PRC-wide entity.

Shanghai Shinomiel

    As stated above in the ``Background'' section, Shanghai Shinomiel 
did not respond to the Department's antidumping questionnaire. Rather, 
as noted above, Shanghai Shinomiel informed the Department that it 
would not be participating in this proceeding, and failed to respond to 
the Department's repeated requests for information. See Shanghai 
Shinomiel and Inner Mongolia Memo. The Department has no information on 
the record for Shanghai Shinomiel with which to calculate a dumping 
margin in this proceeding; therefore, we find that Shanghai Shinomiel 
has significantly impeded the proceeding, pursuant to sections 
776(a)(2)(A) and 776(a)(2)(B) of the Act. Because Shanghai Shinomiel 
did not respond to the Department's questionnaires, sections 782(d) and 
(e) of the Act are not applicable.

[[Page 77189]]

Inner Mongolia

    As stated above in the ``Background'' section, Inner Mongolia 
responded to the Department's antidumping questionnaire. The Department 
subsequently requested additional information from Inner Mongolia in a 
supplemental questionnaire. See Supplemental A, C, and D questionnaire, 
dated April 19, 2004. On May 14, 2004, the Department received a 
partial response to this supplemental questionnaire that was seriously 
deficient. Inner Mongolia stated that it would provide additional 
information subsequent to this response, but failed to do so. We note 
that the information omitted included details on Inner Mongolia's and 
its producers' board members, information critical to the Department's 
separate-rates analysis (see ``Separate Rates'' section above), as well 
as information on its U.S. affiliate.\4\ The Department gave Inner 
Mongolia an additional opportunity to provide the information the 
Department had requested on April 19, 2004. The Department explained to 
Inner Mongolia that it must comply with its requests for information or 
be subject to facts available for the preliminary results. See Letter 
from Edward Yang to Inner Mongolia dated June 23, 2004. In response to 
this additional request for information, Inner Mongolia's counsel 
informed the Department that Inner Mongolia is out of business and 
would no longer participate in this review. See Shanghai Shinomiel and 
Inner Mongolia Memo.
---------------------------------------------------------------------------

    \4\ Prior to the Department sending out an additional 
supplemental questionnaire to Inner Mongolia, on May 24, 2004, Inner 
Mongolia submitted a letter to the Department, which included a 
request for withdrawal from this administrative review. Inner 
Mongolia further stated that the company is canceling its operations 
and liquidating its assets, and no longer has personnel available to 
complete this administrative review.
---------------------------------------------------------------------------

    The Department provided Inner Mongolia with several opportunities 
to comply with its requests for information and to submit complete and 
accurate information. However, Inner Mongolia failed to provide the 
Department with the requested information.
    Due to these serious deficiencies, we preliminarily find that Inner 
Mongolia has failed to provide the information requested, thereby 
significantly impeding the proceeding. Therefore, pursuant to section 
776(a)(2)(A), (B), and (C) of the Act, the Department preliminarily 
finds that the application of facts available is appropriate for these 
preliminarily results.

Shanghai Xiuwei

    Shanghai Xiuwei responded to the Department's original 
questionnaire. However, as stated in the ``Background'' section of this 
notice, the Department requested additional information from Shanghai 
Xiuwei on April 19, 2004. This supplemental questionnaire included 73 
questions that addressed serious deficiencies in Shanghai Xiuwei's 
response regarding affiliation of importers, sales process, and factors 
of production. Despite providing Shanghai Xiuwei with ample time to 
collect the requested information (see memorandum to the File from 
Brandon Farlander, dated April 23, 2004), the Department did not 
receive any of the requested information from Shanghai Xiuwei. The 
Department provided Shanghai Xiuwei with an additional opportunity to 
respond to the Department's request for information on June 23, 2004. 
Shanghai Xiuwei again failed to provide the information requested and 
stated that it was unable to supply any of the requested 
information.\5\ The Department supplied Shanghai Xiuwei with numerous 
opportunities to respond to the Department's requests for information. 
However, Shanghai Xiuwei refused to submit any information in response. 
The Department preliminarily finds, pursuant to section 
776(a)(2)(A),(B),(C), and (D) of the Act, that Shanghai Xiuwei has 
repeatedly withheld information requested by the Department, thereby 
significantly impeding the Department's ability to conduct this 
proceeding. Therefore, the application of facts available is warranted 
with respect to Shanghai Xiuwei.
---------------------------------------------------------------------------

    \5\ Shanghai Xiuwei requested that it be allowed to withdraw 
from the review, well after the time limit had passed for making 
such a request. Moreover, as the Department informed Shanghai 
Xiuwei, petitioners did not withdraw their request for review, and 
the Department was therefore required to continue with the review.
---------------------------------------------------------------------------

Application of Adverse Inference

    Section 776(b) of the Act provides that, in selecting from among 
the facts available, the Department may use an inference that is 
adverse to the interests of the respondent if it determines that a 
party has failed to cooperate to the best of its ability. Adverse 
inferences are appropriate ``to ensure that the party does not obtain a 
more favorable result by failing to cooperate than if it had cooperated 
fully.'' See Statement of Administrative Act (``SAA'') accompanying the 
URAA, H. Doc. No. 316, 103d Cong., 2d Session at 870 (1994). In 
determining whether a respondent has failed to cooperate to the best of 
its ability, the Department need not make a determination regarding the 
willfulness of a respondent's conduct. See Nippon Steel Corp. v. United 
States, 337 F. 3rd 1373, 1382-1393 (Fed. Cir. 2003). Furthermore, ``an 
affirmative finding of bad faith on the part of the respondent is not 
required before the Department may make an adverse inference.'' 
Antidumping Duties; Countervailing Duties: Final Rule, 62 FR 27296, 
27340 (May 19, 1997). Instead, the courts have made clear that the 
Department must articulate its reasons for concluding that a party 
failed to cooperate to the best of its ability, and explain why the 
missing information is significant to the review. Id.
    In determining whether a party failed to cooperate to the best of 
its ability, the Department considers whether a party could comply with 
the request for information, and whether a party paid insufficient 
attention to its statutory duties. See Tung Mung Dev. Co. v. United 
States, 223 F. Supp 2d 1336, 1342 (August 6, 2002). Furthermore, the 
Department also considers the accuracy and completeness of submitted 
information, and whether the respondent has hindered the calculation of 
accurate dumping margins. See Certain Welded Carbon Steel Pipes and 
Tubes from Thailand: Final Results of Antidumping Duty Administrative 
Review, 62 FR 53808, 53819-53820 (October 16, 1997).
    Pursuant to section 776(b) of the Act, we find that the PRC-wide 
entity failed to cooperate by not acting to the best of its ability to 
comply with requests for information. As noted above, the PRC-wide 
entity informed the Department that it would not participate in this 
review, or otherwise, did not provide any of the requested information, 
despite repeated requests that it do so. This information was the sole 
possession of the respondents, and could not be obtained otherwise. 
Thus, because the PRC-wide entity refused to participate fully in this 
proceeding, we find it appropriate to use an inference that is adverse 
to the interests of the PRC-wide entity in selecting from among the 
facts otherwise available. By doing so, we ensure that the companies 
that are part of the PRC-wide entity will not obtain a more favorable 
result by failing to cooperate than had they cooperated fully in this 
review.
    An adverse inference may include reliance on information derived 
from the petition, the final determination in the investigation, any 
previous review, or any other information placed on the record. See 
section 776(b) of the Act. It is the Department's practice to assign 
the highest rate from any segment of a proceeding as total adverse 
facts

[[Page 77190]]

available when a respondent fails to cooperate to the best of its 
ability. See, e.g., Stainless Steel Plate in Coils form Taiwan; 
Preliminary Results and Rescission in Part of Antidumping Duty 
Administrative Review, 67 FR 5789 (February 7, 2002) (``Consistent with 
Department practice in cases where a respondent fails to cooperate to 
the best of its ability, and in keeping with section 776(b)(3) of the 
Act, as adverse facts available, we have applied a margin based on the 
highest margin from any prior segment of the proceeding.'').
    In accordance with the Department's practice, we have preliminarily 
assigned to the PRC-wide entity (including Shanghai Xiuwei, Inner 
Mongolia, and Shjanghai Shinomiel) the rate of 183.80 percent as 
adverse facts available. See, e.g., Rescission of Second New Shipper 
Review and Final Results and Partial Rescission of First Antidumping 
Duty Administrative Review: Brake Rotors from the People's Republic of 
China, 64 FR 61581, 61584 (November 12, 1999). This rate is the highest 
dumping margin from any segment of this proceeding and was established 
in the less-than-fair-value (``LTFV'') investigation based on 
information contained in the petition. See Notice of Final 
Determination of Sales at Less Than Fair Value; Honey from the PRC, 66 
FR 50608 (October 4, 2001) and accompanying Issues and Decision 
Memorandum (``Final Determination''). In selecting a rate for adverse 
facts available, the Department selects a rate that is sufficiently 
adverse ``as to effectuate the purpose of the facts available rule to 
induce respondents to provide the Department with complete and accurate 
information in a timely manner.'' See Final Determination of Sales at 
Less Than Fair Value: Static Random Access Memory Semiconductors from 
Taiwan, 63 FR 8909, 8932 (February 23, 1998).

Corroboration

    We note that information from a prior segment of this proceeding 
constitutes ``secondary information,'' and section 776(c) of the Act 
provides that, when the Department relies on such secondary information 
rather than on information obtained in the course of a review, the 
Department shall, to the extent practicable, corroborate that 
information from independent sources that are reasonably at its 
disposal.\6\ The SAA state that the independent sources may include 
published price lists, official import statistics and customs data, and 
information obtained from interested parties during the particular 
investigation or review. The SAA also clarifies that ``corroborate'' 
means that the Department will satisfy itself that the secondary 
information to be used has probative value. See SAA at 870. As noted in 
Tapered Roller Bearings and Parts Thereof, Finished and Unfinished, 
from Japan, and Tapered Roller Bearings, Four Inches or Less in Outside 
Diameter, and Components Thereof, from Japan; Preliminary Results of 
Antidumping Duty Administrative Reviews and Partial Termination of 
Administrative Reviews, 61 FR 57391, 57392 (November 6, 1996) 
(``TRBs''), to corroborate secondary information, the Department will, 
to the extent practicable, examine the reliability and relevance of the 
information used.
---------------------------------------------------------------------------

    \6\ Secondary information is described in the SAA as 
``information derived from the petition that gave rise to the 
investigation or review, the final determination concerning the 
subject merchandise, or any previous review under section 751 
concerning the subject merchandise.'' See SAA at 870.
---------------------------------------------------------------------------

    We note that in the LTFV investigation, the Department corroborated 
the information in the petition that formed the basis of the 183.80 
percent PRC-wide rate, See Final Determination. Specifically, in the 
LTFV investigation, the Department compared the prices in the petition 
to the prices submitted by individual respondents for comparable 
merchandise. For normal value (``NV''), we compared petitioners' 
factor-consumption data to data reported by respondents. See Notice of 
Preliminary Determination of Sales at Less Than Fair Value: Honey from 
the People's Republic of China, 66 FR 24101 (May11, 2001) 
(``Investigation Prelim'').
    In order to satisfy the corroboration requirements under section 
776(c) of the Act, in the instant review, we reviewed the Department's 
corroboration of the petition rates from the LTFV investigation and in 
the first administrative review. See, e.g., Investigation Prelim; Honey 
from the People's Republic of China: Preliminary Results of First 
Antidumping Duty Administrative Review, 68 FR 69988 (December 16, 2003) 
(``First Admin Review''); and reinforced in Honey from the People's 
Republic of China: Final Results of First Antidumping Duty 
Administrative Review, 69 FR 24128 (May 3, 2004). Because the secondary 
information from the LTFV investigation was recently corroborated in 
the first administrative review, and no information has been presented 
to call into question the reliability of the information from the LTFV 
investigation or the first administrative review, we find that the 
petition information is reliable. For a further discussion, see e.g., 
Memorandum to the File from Kristina Boughton through James Doyle, 
Office Director regarding the Corroboration of the Petition Rate, dated 
December 15, 2004 (``Corroboration Memo'').
    We further note that, with respect to the relevance aspect of 
corroboration, the Department stated in TRBs that it will consider 
information reasonably at its disposal as to whether there are 
circumstances that would render a margin irrelevant. Where 
circumstances indicate that the selected margin is not appropriate as 
adverse facts available, the Department will disregard the margin and 
determine an appropriate margin.'' See TRBs at 61 FR 57392. See also 
Fresh Cut Flowers from Mexico; Final Results of Antidumping Duty 
Administrative Review, 61 FR 6812, 6814 (February 22, 1996) 
(disregarding the highest margin in the case as best information 
available because the margin was based on another company's 
uncharacteristic business expense resulting in an extremely high 
margin). The rate applied in this review is the rate currently 
applicable to all exporters subject to the PRC-wide rate. Further, as 
noted above and in the Corroboration Memo, there is no information on 
the record that the application of this rate would be inappropriate in 
this administrative review or that the margin is not relevant. Thus, we 
find that the information is relevant. Therefore, the Department 
preliminarily determines that the PRC-wide rate of 183.80 is still 
reliable, relevant, and has probative value within the meaning of 
section 776(c) of the Act.

Affiliation

    Jinfu has claimed that it is affiliated with Jinfu Trading (USA) 
Inc., (``Jinfu USA'') within the meaning of section 771(33) of the Act. 
Section 771(33) of the Act states that affiliated persons include: (A) 
Members of a family, including brothers and sisters (whether by the 
whole or half blood), spouse, ancestors, and lineal descendants, (B) 
any officer or director of an organization and such organization, (C) 
partners, (D) employer and employee, (E) any person directly or 
indirectly owning, controlling, or holding with power to vote, five 
percent or more of the outstanding voting stock or shares of any 
organization and such organization, (F) two or more persons directly or 
indirectly controlling, controlled by, or under common control with, 
any person, (G) any person who controls any other person and such other 
person. For purposes of this paragraph, a person

[[Page 77191]]

shall be considered to control another person if the person is legally 
or operationally in a position to exercise restraint or direction over 
the other person. In order to find affiliation between companies, the 
Department must find that at least one of the criteria listed above is 
applicable to the respondents.
    Though no party in this case is questioning whether or not Jinfu 
was in fact affiliated with Jinfu USA at some point during the POR 
within the meaning of Section 771(33), we note that the effective date 
of this affiliation is in question ,and is significant to this 
proceeding for purposes of determining whether Jinfu's U.S. sales 
should be reported as ``export price'' sales or ``constructed export 
price'' sales. See discussion below under ``United States Price'' 
section of this notice. in this regard, Jinfu claims that it was 
affiliated with Jinfu USA as of October 25, 2002, which means the two 
firms were affiliated throughout the entire POR. In support of this 
contention, Jinfu has provided documentation it claims establishes that 
it acquired ownership of Jinfu USA on October 25, 2002.
    Nevertheless, in the most recently completed segment of these PRC 
honey proceedings, the Department determined that Jinfu was not 
affiliated with Jinfu USA at the time of its first sale to the United 
States, which occurred on November 2, 2002. See Final Results and Final 
Rescission, In Part, of Antidumping Duty New Shipper Review, 69 FR 
64029 (November 3, 2004) (``NSR Chengdu Final Results'') and 
accompanying Issues and Decision Memorandum at Comment 2. In making 
this finding in NSR Chengdu Final Results, the Department further noted 
that evidence on the record suggested that Jinfu did not actually own 
Jinfu USA until after the new shipper POR, ending May 31, 2003. See, 
id.
    In considering for purposes of these preliminary results whether 
Jinfu was affiliated with Jinfu USA under section 771(33) of the Act, 
we analyzed all information on the record regarding possible 
affiliation between Jinfu and Jinfu USA. In particular, we considered 
whether Jinfu's purchase/investment in Jinfu USA, as delineated in a 
stock ownership transfer agreement, resulted in a common control 
relationship between Jinfu USA and Jinfu at any time during the POR.
    Based on all of the information on the record, the Department has 
preliminarily determined that Jinfu and Jinfu USA were not affiliated 
with the meaning of section 771(33) of the Act until October 25, 2003, 
which is the date the above-referenced stock transfer agreement was 
executed. We note that this decision is consistent with our findings in 
NSR Chengdu Final Results. Moreover, in reaching this decision, the 
Department considered all the additional information submitted by Jinfu 
in this proceeding, but determined such additional information did not 
have sufficient probative value to call into question the decision in 
NSR Chengdu Final Results. For a further discussion of this issue, see 
Proprietary Administrative Review of the Antidumping Duty Order on 
Honey from the People's Republic of China (PRC): Analysis of the 
Relationship and Treatment of Sales between Jinfu Trading, Co., Ltd. 
and Jinfu Trading (USA) Inc. from Kristina Boughton, Case Analyst, to 
James Doyle, Office Director, dated December 15, 2004.

Normal Value Comparisons

    To determine whether the respondents' sales of the subject 
merchandise to the United States were made at prices below normal 
value, we compared their United States prices to normal values, as 
described in the ``United States Price'' and ``Normal Value'' sections 
of this notice.

United States Price

Export Price

    For Dubao and Jinfu, and certain sales by Wuhan Bee and Zhejiang, 
we based United States price on export price (``EP'') in accordance 
with section 772(a) of the Act, because the first sale to an 
unaffiliated purchaser was made prior to importation, and constructed 
export price (``CEP'') was not otherwise warranted by the facts on the 
record. We calculated EP based on the packed price from the exporter to 
the first unaffiliated customer in the United States. Where applicable, 
we deducted foreign inland freight, foreign brokerage and handling 
expenses, international freight, marine insurance, U.S. inland freight 
expenses from port to warehouse, and U.S. import duties and brokerage 
and handling from the starting price (gross unit price), in accordance 
with section 772(c) of the Act.
    Certain information regarding the sales made from Dubao to its 
unaffiliated customers raises concerns regarding the status of Dubao's 
relationship with its customers, the status of its customers as 
legitimate importers of record, and when and how Dubao received payment 
for its sales. Therefore, the Department intends to further examine 
this information for the final results of review. Moreover, the 
Department intends to further examine this information for the final 
results of review. Moreover, the Department will issue an additional 
supplemental questionnaire following the preliminary results of review. 
Due to the proprietary nature of this information, the specific issues 
are identified in the Proprietary Analysis Memorandum to the File from 
Anya Naschak, Case Analyst, dated December 15, 2004. For purposes of 
these preliminary results, the Department has determined to rely on the 
U.S. sales data submitted by Dubao. For these preliminary results for 
Dubao, we deducted foreign inland freight and foreign brokerage and 
handling expenses from the starting price (gross unit price), in 
accordance with section 772(c) of the Act. For Wuhan Bee, we added 
billing and quantity adjustments and freight revenue to the starting 
price and deducted discounts, foreign inland freight, and foreign 
brokerage and handling expenses from the starting price (gross unit 
price), in accordance with section 772(c) of the Act. And for Zhejiang, 
where applicable, we deducted foreign inland freight and international 
freight from the starting price (gross unit price), in accordance with 
section 772(c) of the Act.
    Based on the Department's preliminary decision on affiliation 
between Jinfu and Jinfu USA, the Department requested that Jinfu supply 
EP sales information for all of its sales to the United States during 
the POR. Therefore, we calculated EP and deducted foreign inland 
freight and foreign brokerage and handling expenses from the starting 
price (gross unit price), in accordance with section 772(c) of the Act.
    Where foreign inland freight, foreign brokerage and handling, or 
marine insurance were provided by PRC service providers or paid for in 
renminbi, we valued these services using Indian surrogate values (see 
``Factors of Production'' section below for further discussion). For 
those expenses that were provided by a market-economy provider and paid 
for in market-economy currency, we used the reported expense.

Constructed Export Price

    For Eswell and certain sales by Wuhan Bee and Zhejiang, we 
calculated CEP in accordance with section 772(b) of the Act, because 
certain sales were made on behalf of the PRC-based company by its U.S. 
affiliate to unaffiliated purchasers. We based CEP on packed, delivered 
or ex-warehouse prices to the first unaffiliated purchaser in the 
United States. Where appropriate, we made deductions from the starting 
price (gross unit price) for movement expenses in accordance with 
section

[[Page 77192]]

772(c)(2)(A) of the Act; these included foreign inland freight, foreign 
brokerage and handling charges, international freight, marine 
insurance, U.S. brokerage and handling, U.S. import duties, and U.S. 
inland freight expenses.
    In accordance with section 772(c)(1) of the Act, we also deducted 
those selling expenses associated with economic activities occurring in 
the United States, including direct selling expenses and indirect 
selling expenses. We also made an adjustment for profit in accordance 
with section 772(d)(3) of the Act.
    Specifically, for Eswell we deducted (where applicable) foreign 
inland freight, international freight, marine insurance, U.S. 
brokerage, U.S. customs duties, U.S. inland freight from the port to 
warehouse, U.S. inland freight from the warehouse to the customer, 
commissions, credit expenses, other direct selling expenses (lab 
tests), indirect selling expenses, CEP profit, and added (where 
applicable) freight revenue.
    For Zhejiang we deducted (where applicable) foreign inland freight, 
international freight, marine insurance, U.S. brokerage, U.S. customs 
duties, U.S. inland freight from the port to warehouse, U.S. inland 
freight from the warehouse to the customer, commissions, credit 
expenses, indirect selling expenses, as well as CEP profit.
    Wuhan Bee reported to the Department further manufacturing costs 
associated with blending subject merchandise with non-subject 
merchandise in the United States. On December 3, 2004, Wuhan Bee 
submitted comments on the appropriate methodology for assessing further 
manufacturing costs for these preliminary results. The Department has 
examined these comments and determined, for these preliminary results, 
the appropriate methodology for calculating a further manufacturing 
cost. Because of the proprietary nature of this information, further 
discussion of this issue can be found in the Memorandum to the File 
from Kristina Boughton: Wuhan Bee Healthy Co. Ltd. Analysis Memorandum 
for the Preliminary Results of Review, dated December 15, 2004. For 
Wuhan Bee, to calculate CEP we added (where applicable) billing and 
quantity adjustments and freight revenue to the gross unit price. Then 
we deducted (where applicable) discounts, foreign inland freight, 
foreign brokerage and handling charges, international freight, marine 
insurance, U.S. brokerage, U.S. customs duties, U.S. inland freight 
from the port to warehouse, U.S. inland freight from the warehouse to 
the customer, further manufacturing, credit expenses, commissions, 
inventory carrying costs, indirect selling expenses, and CEP profit.
    Where foreign inland freight, foreign brokerage and handling, or 
marine insurance, were provided by PRC service providers or paid for in 
renminbi, we valued these services using Indian surrogate values (see 
``Factors of Production'' section below for further discussion). For 
those expenses that were provided by a market-economy provider and paid 
for in market-economy currency, we used the reported expense.

Normal Value

Non-Market-Economy Status

    In every case conducted by the Department involving the PRC, the 
PRC has been treated as an NME country. Pursuant to 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. See Tapered Roller Bearings and Parts Thereof, 
Finished and Unfinished, From the People's Republic of China: 
Preliminary Results 2001-2002 Administrative Review and Partial 
Rescission of Review, 68 FR 7500 (February 14, 2003). None of the 
parties to these reviews have contested such treatment. Accordingly, we 
calculated NV in accordance with section 773(c) of the Act, which 
applies to NME countries.

Surrogate Country

    Section 773(c)(4) of the Act requires the Department to value an 
NME producer's factors of production, to the extent possible, in one or 
more market-economy countries that (1) are at a level of economic 
development comparable to that of the NME country, and (2) are 
significant producers of comparable merchandise. India is among the 
countries comparable to the PRC in terms of overall economic 
development, as identified in the February 24, 2004, Memorandum from 
the Office of Policy to Abdelali Elouaradia.\7\ In addition, based on 
publicly available information placed on the record (e.g., world 
production data), India is a significant producer of the subject 
merchandise. Accordingly, we considered India the surrogate country for 
purposes of valuing the factors of production because it meets the 
Department's criteria for surrogate-country selection. See Memorandum 
to the file from Anya Naschak through James Doyle entitled, ``Selection 
of a Surrogate Country,'' dated December 15, 2004 (``Surrogate Country 
Memo'').
---------------------------------------------------------------------------

    \7\ This memorandum is attached to the letters sent to 
interested parties to this proceeding requesting comments on 
surrogate country and surrogate value information, dated March 25, 
2004.
---------------------------------------------------------------------------

Factors of Production

    In accordance with section 773(c) of the Act, we calculated NV 
based on the factors of production which included, but we were not 
limited to: (A) Hours of labor required; (B) quantities of raw 
materials employed; (C) amounts of energy and other utilities consumed; 
and (D) representative capital costs, including depreciation. We used 
factors of production reported by the producer or exporter for 
materials, energy, labor, and packing. To calculate NV, we multiplied 
the reported unit factor quantities by publicly available Indian 
values.
    In selecting the surrogate values, we considered the quality, 
specificity, and contemporaneity of the data, in accordance with our 
practice. When we used publicly available import data from the Ministry 
of Commerce of India (``Indian Import Statistics'') for December 2002 
through November 2003 to value inputs sourced domestically by PRC 
suppliers, we added to the Indian surrogate values a surrogate freight 
cost calculated using the shorter of the reported distance from the 
domestic supplier to the factory or the distance from the nearest port 
of export to the factory This adjustment is in accordance with the 
Court of Appeals for the Federal Circuit's decision in Sigma Corp v. 
United States, 117 F. 3d 1401, 1408 (Fed. Cir. 1997). When we used non-
import surrogate values for factors sourced domestically by PRC 
suppliers, we based freight for inputs on the actual distance from the 
input supplier to the site at which the input was used. In instances 
where we relied on Indian import data to value inputs, in accordance 
with the Department's practice, we excluded imports from both NME 
countries and countries deemed to maintain broadly available, non-
industry-specific subsidies which may benefit all exporters to all 
export markets (i.e., Indonesia, South Korea, and Thailand) from our 
surrogate value calculations. See, e.g., Final Determination of Sales 
at Less Than Fair Value Certain Automotive Replacement Glass 
Windshields from the People's Republic of China, 67 FR 6482 (February 
12, 2002) and accompanying Issues and Decisions Memorandum at Comment 
1. See, also, Notice of Preliminary Determination of Sales at Less Than 
Fair Value, Postponement of Final Determination, and Affirmative 
Preliminary Determination of Critical

[[Page 77193]]

Circumstances: Certain Color Television Receivers From the People's 
Republic of China, 68 FR 66800, 66808 (November 28, 2003), unchanged in 
the Department's final results at 69 FR 20594 (April 16, 2004). Also 
consistent with our policy, we excluded, in a few instances, import 
data that appeared to be aberrational when compared to the average 
import value of all countries not excluded. See Notice of Final 
Determination of Sales at Less Than Fair Value: Certain Color 
Television Receivers From the People's Republic of China, 69 FR 20594, 
April 16, 2004, and accompanying issues and Decision Memorandum at 
Comment 5. See Memorandum to the File, through James Doyle, Office 
Director, entitled, ``Factors of Production Valuation Memorandum for 
the Preliminary Results of the Second Antidumping Duty Review of Honey 
from the People's Republic of China,'' dated December 15, 2004 
(``Factor Valuation Memo''), for a complete discussion of the import 
data what we excluded from our calculation of surrogate values. This 
memorandum is on file in the Central Records Unit (``CRU'') located in 
room B-099 of the Main Commerce Building.
    Where we could not obtain publicly available information 
contemporaneous with the POR to value factors, we adjusted the 
surrogate values using the Indian Wholesale Price Index (``WPI'') as 
published in the International Financial Statistics (``IFS'') of the 
International Monetary Fund (``IMF''), for those surrogate values in 
Indian rupees. We made currency conversions, where necessary, pursuant 
to section 351.415 of the Department's regulations to U.S. dollars 
using the applicable average exchange rate for the POR. We based the 
average exchange rates on exchange rate data from the Import 
Administration Web site at http://ia.ita.doc.gov/exchange/index.html. 
See Factor Valuation Memo. We valued the factors of production as 
follows:
    To value raw honey, we used the average of two raw honey prices, 
provided in an article published in The Tribune (of India) on December 
15, 2003, entitled, ``Honey sweet despite price fall.'' A copy of the 
original article, which was submitted by petitioners, is attached at 
Attachment 3 of the Factor Valuation Memo. The respondents in this 
review submitted other news articles to be used as potential sources 
for the surrogate value data for raw honey, including an article from 
the Hindu Business Line dated April 2003 and an article from 
IndiaInfoline.com dated September 2003. We have not used either of 
these alternate sources proposed by respondents in the preliminary 
results, as discussed in the Factor Valuation Memo.
    In selecting the raw honey values from The Tribune (of India) 
article as the best available information with which to value raw honey 
in this proceeding, we note that the Department has conducted extensive 
research on potential raw honey surrogate values for this 
administrative review. The relevant research is included as Attachment 
17 of the Factor Valuation Memo. Additionally, the Department contacted 
U.S. Foreign Agriculture Service (``FAS'') officers in India to conduct 
research on its behalf (see Memorandum to the File from Anya Naschak, 
dated November 19, 2004). The information obtained from these FAS 
officers included price quotes from the North India Beekeepers Society 
(``NIBS''). The Department also evaluated the reasonableness of using 
Mahabaleshwar Honey Producers Cooperative Society, Ltd.'s (``MHPC'') 
cost of raw honey from its financial statements. None of these other 
sources of information are as reliable as the raw honey values 
appearing in The Tribune (of India) article. Specifically, the 
Department cannot confirm the quality or reliability of the NBS values, 
and the MHPC price is that a single producer. In addition, we note 
``the Department's preference is to use industry-wide values, rather 
than the values of a single producer, wherever possible, because 
industry-wide values are more representative of prices/costs of all 
producers in the surrogate country.'' See Notice of Final Determination 
of Sales at Less Than Fair Value: Honey From the People's Republic of 
China, 66 FR 50608 (October 4, 2001), and accompanying Issues and 
Decision Memorandum at Comment 2 (``Final Determination''). See also 
Final Results of the First Administrative Review of the Antidumping 
Duty Order on Honey from the People's Republic of China, 69 FR 25060 
(May 5, 2004), and accompanying Issues and Decision Memorandum at 
Comment 3.
    The use of The Tribune (of India) article is also consistent with 
the Department's recent decision in the third new shipper review of 
this order. See NSR Chengdu Final Results and accompanying Issues and 
Decision Memorandum at Comment 4. For a further discussion of this 
issue, see Factor Valuation Memo, as well as the preliminary results of 
the new shipper reviews that are contemporaneous with the instant 
review. See Honey from the People's Republic of China: Notice of 
Preliminary Results of Antidumping Duty New Shipper Reviews, 69 FR 
69350 (November 29, 2004) (``NSR Anhui Prelim Results'').
    To value water, we used the water tariff rate, as reported on the 
Municipal Corporation of Greater Mumbai's Web site. See http://www.mcgm.gov.in/Stat%20&%20Fig/Revenue.htm. Because this data is not 
contemporaneous with the POR, an adjustment has been made for inflation 
using WPI data.
    To value diesel fuel for autos, we used the rate published in 
International Energy Agency, Energy Prices and Taxes--Quarterly 
Statistics (Fourth Quarter 2003), under ``Automotive Diesel for 
Commercial Use.'' See Factor Valuation Memo.
    To value beeswax, scrap honey, coal, paint, and labels, we used 
Indian Import Statistics, contemporaneous with the POR, removing data 
from certain countries as discussed in the Factor Valuation Memo. We 
also adjusted the surrogate values to include freight costs incurred 
between the shorter of the two reported distances from either (1) the 
closet PRC seaport to the location producing the subject merchandise, 
or (2) the PRC domestic materials supplier to the location where the 
subject merchandise is produced. See Factor Valuation Memo.
    We valued electricity using the Annual Report (2001-2002) on The 
Working of State Electricity Boards & Electricity Departments of the 
Planning Commission (Power and Energy Division) of the Government of 
India (May 2002), as submitted by respondents in their May 10, 2004, 
submission at Exhibit 5. We inflated the value for electricity using 
the POR average WPI rate. See Factor Valuation Memo.
    To value drums, we relied upon a price quote from an Indian steel 
drum manufacturer from September 2000, as provided by Petitioners in 
their May 10, 2004, submission at Exhibit 9. We inflated the value for 
drums using the POR average WPI rate. See Factor Valuation Memo.
    To value factory overhead, selling, general, and administrative 
expenses (``SG&A''), and profit, we relied upon publicly available 
information in the 2002-2003 annual report of MHPC, a producer of the 
subject merchandise in India, upon which both petitioners and 
respondents have argued that the Department should rely upon. 
Petitioners aver in their November 18, 2004, submission that the 
Department should continue to rely on the methodology used in NSR 
Chengdu Final Results. Respondents argued in their December 3, 2004, 
submission that the Department should exclude the line

[[Page 77194]]

item for ``Honey Sale Commission'' from the calculation of SG&A. 
However, we preliminarily find that the Department's calculation in NSR 
Chengdu Final Results was appropriate. Therefore, for these preliminary 
results we are continuing to include ``Honey Sale Commission'' in our 
calculation of the SG&A ratio and have applied the resulting ratios to 
the calculated cost of manufacture and cost of production using the 
same methodology established in NSR Chengdu Final Results and 
accompanying Issues and Decision Memorandum at Comment 5 and reinforced 
in NSR Anhui Prelim Results. For a further discussion of this issue, 
see Factor Valuation Memo.
    Because of the variability of wage rates in countries with similar 
levels of per capita gross domestic product, section 351.408(c)(3) of 
the Department's regulations requires the use of regression-based wage 
rate. Therefore, to value the labor input, we used the PRC's 
regression-based wage rate published by Import Administration on its 
Web site. The source of the wage rate data on the Import Administration 
Web site is the Yearbook of Labor Statistics 2002, International Labor 
Organization (``ILO''), (Geneva: 2002), and gross national income 
(GNI'') data as reported in World Development Indicators, The World 
Bank, (Washington, DC: 2003 and 2004). See Factor Valuation Memo.
    To value truck freight, we used an average truck freight cost based 
on Indian truck freight rates on a per-metric-ton basis published in 
the Iron and Steel Newsletter, April 2002, which we adjusted for 
inflation. See Factor Valuation Memo.
    We valued marine insurance, where necessary, based on publicly 
available price quotes from a marine insurance provider at http://www.rjgconsultants.com/insurance.html. We also valued brokerage and 
handling using the source, dated November 12, 1999, that petitioners 
provided in their May 10, 2004, submission. Since the brokerage rate 
was not contemporaneous with the POR, we adjusted the rate for 
inflation. See Factor Valuation Memo.
    In accordance with section 351.301(c)(3)(ii) of the Department's 
regulations, for the final results of this administrative review, 
interested parties may submit publicly available information to value 
the factors of production until 20 days following the date of 
publication of these preliminary results.

Preliminary Results of Review

    We preliminarily determine that the following antidumping duty 
margins exist:

------------------------------------------------------------------------
                                                                 Margin
                           Exporter                            (percent)
------------------------------------------------------------------------
Sichuan-Dujiangyan Dubao Bee Industrial Co., Ltd.............      41.99
Shanghai Eswell Enterprise Co., Ltd..........................      38.25
Jinfu Trading Co., Ltd.......................................      73.67
Wuhan Bee Healthy Company, Ltd...............................       5.69
Zhejian Native Produce and Animal By-Products Import & Export      44.98
 Group Corp..................................................
Shanghai Xiuwei International Trading Co., Ltd...............     183.80
Inner Mongolia Autonomous Region Native Produce and Animal By-    183.80
 Products Import & Export Corp...............................
Shanghai Shinomiel International Trade Corporation...........     183.80
PRC-Wide Rate................................................     183.80
------------------------------------------------------------------------

    For details on the calculation of the antidumping duty weighted-
average margin for each company, see the respective company's Analysis 
Memorandum for the Preliminary Results of the Second Administrative 
Review of the Antidumping Duty Order on Honey from the People's 
Republic of China, dated December 15, 2004. Public Versions of these 
memoranda are on file in the CRU.

Assessment Rates

    Pursuant to section 351.212(b) of the Department's regulations, the 
Department calculates an assessment rate for each importer of the 
subject merchandise. Upon issuance of the final results of this review, 
if any importer-specific assessment rates calculated in the final 
results are above de minimis (i.e., at or above 0.50 percent), the 
Department will issue appraisement instructions directly to CBP to 
assess antidumping duties on appropriate entries by applying the 
assessment rate to the entered quantity or value of the merchandise. 
For assessment purposes, we calculated importer-specific assessment 
rates for the subject merchandise by aggregating the dumping duties due 
for all U.S. sales to each importer and dividing the amount by the 
total quantity or entered value of the sales to that importer.\8\ If 
these preliminary results are adopted in our final results of review, 
we will direct CBP to assess the resulting rate against the total 
quantity or entered value for the subject merchandise on each of the 
respondents' importer's/customer's entries during the POR.
---------------------------------------------------------------------------

    \8\ Where entered value was not reported, we relied on the 
quantity of subject merchandise.
---------------------------------------------------------------------------

Cash-Deposit Requirements

    The following cash-deposit rates will be effective upon publication 
of the final results of this review for all shipments of honey from the 
PRC entered, or withdrawn from warehouse, for consumption on or after 
publication date, as provided for by section 751(a)(2)(C) of the Act: 
(1) For subject merchandise exported by Dubao, Eswell, Jinfu, Wuhan 
Bee, and Zhejiang, the cash-deposit rate will be that established in 
the final results of this review, except if the rate is less than 0.50 
percent and, therefore, de minimis within the meaning of 19 CFR 
351.106(c)(1), in which case the cash deposit rate will be zero; (2) 
for previously investigated or reviewed companies not listed above that 
have separate rates, the cash-deposit rate will continue to be the 
company-specific rate published for the most recent period (except for 
Inner Mongolia and Shanghai Xiuwei, whose cash-deposit rates have 
changed in their review to the PRC-wide entity rate as noted below); 
(3) the cash-deposit rate for all other PRC exporters (including Inner 
Mongolia, Shanghai Xiuwei, and Shanghai Shinomiel) will be the PRC-wide 
rate established in the final results of this review; and (4) the cash 
deposit rate for all other non-PRC exporters will be the rate 
applicable to the PRC exporter that supplied that exporter.
    These deposit requirements, when imposed, shall remain in effect 
until publication of the final results of the next administrative 
review.

Schedule for Final Results of Review

    The Department will disclose calculations performed in connection 
with the preliminary results of this review within five days of the 
date of publication of this notice in accordance with section 
351.224(b) of the Department's regulations. Any interested party may 
request a hearing within 30 days of publication of this notice is 
accordance with section 351.310(c) of the Department's regulations. Any 
hearing would normally be held 37 days after the publication of this 
notice, or the first workday thereafter, at the U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 
20230. Individuals who wish to request a hearing must submit a written 
request within 30 days of the publication of this notice in the Federal 
Register to the Assistant Secretary for Import Administration, U.S. 
Department of Commerce, Room 1870, 14th Street

[[Page 77195]]

and Constitution Avenue, NW., Washington, DC 20230. Requests for a 
public hearing should contain: (1) The party's name, address, and 
telephone number; (2) the number of participants; and (3) to the extent 
practicable, an identification of the arguments to be raised at the 
hearing.
    Unless otherwise notified by the Department, interested parties may 
submit case briefs within 30 days of the date of publication of this 
notice is accordance with section 351.309(c)(ii) of the Department's 
regulations. As part of the case brief, parties are encouraged to 
provide a summary of the arguments not to exceed five pages and a table 
of statutes, regulations, and cases cited. Rebuttal briefs, which must 
be limited to issues raised in the case briefs, must be filed within 
five days after the case brief is filed. If a hearing is held, an 
interested party may make an affirmative presentation only on arguments 
included in that party's case brief and may make a rebuttal 
presentation only on arguments include in that party's rebuttal brief. 
Parties should confirm by telephone the time, date, and place of the 
hearing within 48 hours before the scheduled time. The Department will 
issue the final results of this review, which will include the results 
of its analysis of issues raised in the briefs, not later than 150 days 
after the date of publication of this notice (see ``Extension of Final 
Results'' section above).

Notification to Importers

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

    Dated: December 15, 2004.
James J. Jochum,
Assistant Secretary for Import Administration.
[FR Doc. 04-28119 Filed 12-23-04; 8:45 am]
BILLING CODE 3510-DS-M
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