[Federal Register Volume 72, Number 90 (Thursday, May 10, 2007)]
[Notices]
[Pages 26595-26600]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-9040]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-504]


Petroleum Wax Candles from the People's Republic of China: 
Preliminary Results and Partial Rescission of the Eighth Administrative 
Review

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') is currently 
conducting an administrative review of the antidumping duty order on 
petroleum wax candles from the People's Republic of China (``PRC'') 
covering the period August 1, 2005, through July 31, 2006. This review 
covers imports of subject merchandise from one manufacturer/exporter: 
Deseado International, Ltd. (``Deseado''). 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 
all appropriate entries in accordance with these results. We invite 
interested parties to comment on these preliminary review results and 
will issue the final review results no later than 120 days from the 
date of publication of this notice.

EFFECTIVE DATE:  May 10, 2007.

FOR FURTHER INFORMATION CONTACT: Irene Gorelik, AD/CVD Operations, 
Office 9, Import Administration, International Trade Administration, 
U.S. Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230; telephone: (202) 482-6905.

SUPPLEMENTARY INFORMATION:

Background

    On August 28, 1986, the Department published in the Federal 
Register the antidumping duty order on petroleum wax candles from the 
PRC. See Antidumping Duty Order: Petroleum Wax Candles From the 
People's Republic of China, 51 FR 30686 (August 28, 1986) (``Candles 
Order'').
    On August 31, 2006, Deseado submitted a timely request for an 
administrative review. On September 29, 2006, in response to Deseado's 
request and in accordance with section 751(a)(1) of the Tariff Act of 
1930, as amended (the ``Act''), and section 351.213(b) of the 
Department's regulations, the Department initiated the eighth 
administrative review of petroleum wax candles from the PRC on 14 
companies.\1\ See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews, 71 FR 57465 (September 29, 2006).
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    \1\ The following companies upon which we initiated an 
administrative review, except Deseado, withdrew their requests for 
review after the issuance of the quantity and value (``Q&V'') 
questionnaire: Amstar Business Company Limited (``Amstar''), Apex 
Enterprises International Ltd. (``Apex'') and Apex's producer, 
Golden Industrial Co., Ltd. (``Golden''), Fuzhou Eastown Arts Co., 
Ltd. (``Fuzhou''), Gift Creative Company, Ltd. (``Gift''), Maverick 
Enterprise Co., Ltd. (``Maverick'') and Maverick's producer Great 
Founder International Co. (``Great Founder''), Qingdao Kingking 
Applied Chemistry Co., Ltd. (``KingKing''), Shantou Jinyuan Mingfeng 
Handicraft Co. (``Shantou Jinyuan''), Shanghai Shen Hong Arts and 
Crafts Co., Ltd. (``Shen Hong'') and Shen Hong's producer Shanghai 
Changran Enterprise, Ltd . (``Changran''), Shenzhen Sam Lick 
Manufactory (and affiliated exporter Prudential (HK) Candles 
Manufacturing Co., Ltd). (``Sam Lick,'' collectively), Transfar 
International Corp. (``Transfar'');
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    On October 12, 2006, the Department issued a Q&V questionnaire to 
Deseado and the other 13 companies upon which we initiated the 
review.\2\ On October 30, 2006, the Department sent a letter to Deseado 
notifying the company of its failure to submit a Q&V questionnaire 
response by the deadline date.\3\ We provided Deseado with a new 
deadline of November 3, 2006, to submit a Q&V questionnaire response, 
which Deseado timely submitted. On December 7, 2006, the Department 
issued its standard non-market economy (``NME'') questionnaire to 
Deseado. On January 4, 2007, Deseado submitted its section A response 
to the Department's antidumping duty questionnaire.\4\ In its section A 
questionnaire response, Deseado informed the Department that it is a 
trading company/exporter of the merchandise under consideration with an 
unaffiliated manufacturer/supplier in the PRC.\5\
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    \2\ The original deadline for the quantity and value 
questionnaire was October 26, 2006.
    \3\ See Letter dated October 30, 2006, to Deseado regarding the 
missed deadline for Q&V questionnaire response.
    \4\ Sections A (Organization, Accounting Practices, Markets and 
Merchandise), C (Sales to the United States), D (Factors of 
Production), E (Cost of Further Manufacturing Performed in the 
United States) and Sales and Factors of Production Reconciliations.
    \5\ See Deseado's Section A questionnaire response dated January 
4, 2007, at 19.
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    On January 8, 2007, the National Candle Association 
(``Petitioner'') submitted deficiency comments with respect to 
Deseado's Separate Rates Application. On January 26, 2007, Petitioner 
submitted additional deficiency comments with respect to Deseado's 
separate rates application and its section A response.
    On January 29, 2007, Deseado submitted the CBP 7501 entry summaries 
for its sales of subject merchandise to the United States, as requested 
by the Department, as well as its sections C and D questionnaire 
responses. On February 6, 2007, Petitioner submitted deficiency 
comments with respect to Deseado's section C response. On February 16, 
2007, Petitioner submitted additional deficiency comments regarding 
Deseado's section C response relative to Deseado's submission of its 
CBP 7501 entry summaries. On February 16, 2007, the Department issued a 
supplemental section A questionnaire to Deseado. On March 6, 2007, 
Deseado submitted its supplemental section A response.
    On March 8, 2007, the Department issued a letter to Deseado stating 
that, upon review of Deseado's sections C and D questionnaire 
responses, Deseado had not provided any data that the Department could 
use to calculate an antidumping duty margin. The Department provided 
instructions within this letter for Deseado to correct its data 
deficiencies by March 19, 2007. On March 19, 2007, Deseado informed the 
Department that it was unable to provide the information requested by 
the Department in the March 8, 2007, letter.\6\ On April 3, 2007, 
Petitioner submitted a request to terminate the administrative review 
with respect to Deseado. On April 10, 2007, Deseado submitted a letter 
stating that because it was the only party to have requested the 
administrative review, Petitioner had no grounds upon which to request 
a termination of the administrative review.
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    \6\ In its March 19, 2007, letter, Deseado stated that it was 
unable to provide the information requested in the Department's 
March 8, 2007, letter due to its supplier's unwillingness to 
cooperate and provide the information.
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Period of Review

    The period of review (``POR'') covers August 1, 2005, through July 
31, 2006.

Scope of the Order

    The products covered by Candles Order are certain scented or 
unscented petroleum wax candles made from petroleum wax and having 
fiber or paper-cored wicks. They are sold in the following shapes: 
tapers, spirals, and

[[Page 26596]]

straight-sided dinner candles; round, columns, pillars, votives; and 
various wax-filled containers. The products were classified under the 
Tariff Schedules of the United States (``TSUS'') 755.25, Candles and 
Tapers. The product covered are currently classified under the 
Harmonized Tariff Schedule of the United States (``HTSUS'') item 
3406.00.00. Although the HTSUS subheading is provided for convenience 
purposes, our written description remains dispositive. See Candles 
Order and Notice of Final Results of the Antidumping Duty New Shipper 
Review: Petroleum Wax Candles from the People's Republic of China, 69 
FR 77990 (December 29, 2004).

Partial Rescission of Administrative Review

    Pursuant to 19 CFR 351.213(d)(1), the Secretary must rescind an 
administrative review if a party requesting a review withdraws the 
request within ninety (90) days of the date of publication of the 
notice of initiation. As noted above, thirteen companies upon which the 
Department initiated an administrative review submitted timely 
withdrawals of their requests for review, in accordance with 19 CFR 
351.213(d)(1).\7\ No interested party provided any comments on the 
withdrawals. Therefore, because no other interested party requested a 
review of these companies, in accordance with 19 CFR 351.213(d)(1), and 
consistent with our practice, we are rescinding the administrative 
review of these thirteen companies for the POR.
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    \7\ On October 25, 2006, Nantucket Distributing Co., Inc., a 
U.S. importer, withdrew request for administrative reviews with 
respect to Sam Lick; on October 26, 2006, KingKing, withdrew its 
request for an administrative review; on October 25, 2006, Amstar 
withdrew its request for an administrative review; on October 26, 
2007, Specialty Merchandise Corporation (<gr-thn-eq>SMC<gr-thn-eq>), 
a U.S. importer withdrew its request for administrative reviews with 
respect to Fuzhou, Gift, Maverick (and its producer Great), Shantou 
Jinyuan, Shen Hong (and its producer Changran), and Transfar; on 
November 22, 2006, SMC withdrew its request for administrative 
reviews with respect to Apex (and its producer, Golden).
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Non-Market Economy Country Status

    In every case conducted by the Department involving the PRC, the 
PRC has been treated as a 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 Freshwater Crawfish Tail Meat from the 
People's Republic of China: Notice of Final Results of Antidumping Duty 
Administrative Review, 71 FR 7013 (February 10, 2006). None of the 
parties to this proceeding has contested such treatment.

Separate Rates

    In proceedings involving NME countries, the Department begins with 
a rebuttable presumption that all companies within the country are 
subject to government control and thus should be assessed a single 
antidumping duty deposit rate (i.e., a PRC-wide rate). In its separate 
rates application, Deseado reported that it is owned wholly by an 
entity located and registered in a market-economy country (i.e., Hong 
Kong). Thus, because we have no evidence indicating that Deseado is 
under the control of the PRC government, a separate-rate analysis is 
not necessary to determine whether it is independent from government 
control. See Brake Rotors From the People's Republic of China: Final 
Results and Partial Rescission of Fifth New Shipper Review, 66 FR 44331 
(Aug. 23, 2001), results unchanged from Brake Rotors From the People's 
Republic of China: Preliminary Results and Partial Rescission of Fifth 
New Shipper Review, 66 FR 29080, 29081 (May 29, 2001) (where the 
respondent was wholly owned by a U.S. registered company); Brake Rotors 
From the People's Republic of China: Final Results and Partial 
Rescission of Fourth New Shipper Review and Rescission of Third 
Antidumping Duty Administrative Review, 66 FR 27063 (May 16, 2001) 
(where the respondent was wholly owned by a company located in Hong 
Kong), results unchanged from Brake Rotors From the People's Republic 
of China: Preliminary Results and Partial Rescission of the Fourth New 
Shipper Review and Rescission of the Third Antidumping Duty 
Administrative Review, 66 FR 1303, 1306 (January 8, 2001); and Notice 
of Final Determination of Sales at Less Than Fair Value: Creatine 
Monohydrate from the People's Republic of China, 64 FR 71104, 71105 
(Dec. 20, 1999) (``Creatine from the PRC'') (where the respondent was 
wholly owned by persons located in Hong Kong).

Application of Adverse Facts Available

    As discussed further below, pursuant to sections 776(a)(2)(A), (B), 
and (C), and 776(b) of the Act, the Department preliminarily determines 
that the use of total adverse facts available is warranted for Deseado. 
Section 776(a)(2) of the Act, provides that, if an interested party (A) 
withholds information that has been requested by the Department; (B) 
fails to provide such information in a timely manner or in the form or 
manner requested subject to sections 782(c)(1) and (e) of the Act; (C) 
significantly impedes a proceeding; or (D) provides such information 
but the information cannot be verified, the Department shall, subject 
to subsection 782(d) of the Act, use facts otherwise available in 
reaching the applicable determination.
    Section 782(c)(1) of the Act provides that if an interested party 
``promptly after receiving a request from {the Department{time}  for 
information, notifies {the Department{time}  that such party is unable 
to submit the information requested in the requested form and manner, 
together with a full explanation and suggested alternative form in 
which such party is able to submit the information,'' the Department 
may modify the requirements to avoid imposing an unreasonable burden on 
that party.
    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 will so inform the party submitting the 
response and will, to the extent practicable, provide that party the 
opportunity to remedy or explain the deficiency. If the party fails to 
remedy the deficiency within the applicable time limits and subject to 
the requirements listed in section 782(e) of the Act, the Department 
may disregard all or part of the original and subsequent responses, as 
appropriate. 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 applicable requirements established by the administering 
authority'' if the information is timely, can be verified, is not so 
incomplete that it cannot be used, and the interested party acted to 
the best of its ability in providing the information. Where all of 
these conditions are met, the statute requires the Department to use 
the information if it can do so without undue difficulties.

Use of Facts Available

    We find that, pursuant to sections 776(a)(2)(A), (B), and (C) of 
the Act, we should apply facts available to exports by Deseado because 
Deseado (1) failed to provide information requested by the Department; 
(2) failed to report in a timely manner information that was requested 
by the Department; and (3) significantly impeded the proceeding.
    As discussed above, the Department reviewed Deseado's section C and 
D questionnaire responses, which should have contained detailed 
information regarding Deseado's sales of subject

[[Page 26597]]

merchandise to the United States and factors of production (``FOP'') 
data, respectively.
    Deseado failed to provide accurate or complete information with 
respect to: (1) A sales reconciliation, as requested; (2) data fields 
in the sales database that are supposed to contain sale-specific data 
were instead populated with information other than numerical data, 
which renders the database unuseable; (3) payment data for each sale 
invoice amount of subject merchandise sold to the United States; and 
(4) inland freight, which was reported as an estimation of distance 
rather than an accurate reporting of inland freight distance for each 
sale to the United States.\8\ Consequently, the breadth of the 
deficient, incorrect, or missing data alone forced the Department to 
send its letter dated March 8, 2007, to enumerate the deficiencies and 
receive a response upon which we could conduct an accurate analysis of 
Deseado's POR sales to the United States. As discussed below, the 
Department attempted to provide Deseado with an opportunity to remedy 
the deficiencies contained within its original section C response.
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    \8\ See Deseado's section C questionnaire response (``SCQR'') 
dated January 29, 2007, at C-9 through C-11 and Exhibit C-1.
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    In the March 8, 2007, letter to Deseado, the Department stated that 
Deseado's sales data was unusable in the format in which it was 
submitted. Specifically, Deseado's sales data included a control number 
assigned to each sale that did not contain any physical characteristics 
of the merchandise under consideration, as requested by the Department 
in its initial questionnaire.\9\ The Department's March 8, 2007, letter 
provided the steps necessary for Deseado to reconstruct its CONNUM 
methodology into a format that is specific to the physical 
characteristics of the subject merchandise, which would reconcile to 
the FOPs used in manufacturing the merchandise. Moreover, the March 8, 
2007, letter also stated that the sales database must be formatted 
pursuant to the Department's instructions in its initial questionnaire 
for use in the Department's margin calculation. Deseado's response in 
its March 19, 2007, letter did not address any of the sales data 
deficiencies remarked upon in our March 8, 2007, letter.
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    \9\ The control number (``CONNUM'') is assigned to each unique 
product reported in the sales database. Each identical product would 
be assigned the same CONNUM. However, products with physical 
variations require multiple CONNUMs assigned to it. The CONNUM 
methodology is based on the ``physical characteristics'' of each 
unique product sold by Deseado, which is used to tie each unique 
product sold to the cost of materials, labor, energy and packing, 
i.e., the FOPs, to manufacture that unique product. Rather, Deseado 
provided the bar code numbers (``SKU'') numbers associated with the 
finished good rather than constructing a CONNUM for each unique 
product based in the physical characteristics of the merchandise. 
See SCQR at 8-9. The SKU numbers are not descriptive of the physical 
characteristics of the unique product. Thus, the Department could 
not compare the sale of the product with the FOPs used in 
manufacturing that product in the data submitted by Deseado as 
required by the dumping calculation.
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    Additionally, in reviewing Deseado's section D questionnaire 
response, which should have contained information and data related to 
FOPs and the cost portion of the merchandise under consideration, the 
Department found that Deseado entirely omitted the FOP database and 
narrative descriptions of the FOPs from the section D questionnaire 
response.\10\ Deseado did not provide any consumption data\11\ for the 
FOPs used to produce the subject merchandise, without which the 
Department is unable to construct a normal value (``NV''). FOP 
information is fundamental for calculating a dumping margin. Section 
771(35)(A) of the Act requires that dumping margins are calculated by 
comparing the NV to the export price or constructed export price. For 
NME countries, the Act states that the NV is determined ``on the basis 
of the value of the factors of production utilized in producing the 
merchandise.'' See section 773(c)(1) of the Act.
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    \10\See Deseado's Section D questionnaire response dated January 
29, 2007, at Exhibit D-1. The Department notes that Exhibit D-1, 
which Deseado referred to as the FOP database, is simply the FOP 
worksheet we include in the original questionnaire for respondents 
to provide information such as percentages of NME versus market 
economy purchases, supplier distance information, units of 
measurement, modes of transport, etc.
    \11\ Consumption data consist of the POR consumption quantity of 
FOP inputs used to produce subject merchandise divided by the total 
POR production of subject merchandise. This methodology for 
calculating FOP consumption ratios is fully explained in the 
original Section D questionnaire.
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    Deseado also failed to submit a cost reconciliation, as requested 
in the original questionnaire. The Department's letter dated March 8, 
2007, also addressed Deseado's omission of the entire FOP narrative and 
data, providing it an opportunity to remedy this deficiency as well. On 
March 19, 2007, Deseado provided a brief response with respect to the 
missing FOP data, stating that its supplier was uncooperative. Deseado 
did not provide any further detail regarding the failures of its 
supplier to provide FOP data.
    Therefore, pursuant to sections 776(a)(2)(A) and (B) of the Act, 
the Department has determined that it is appropriate to apply the facts 
available to Deseado's sales of subject merchandise to the United 
States during the POR because Deasado has failed to provide FOP 
information requested by the Department. Because the Department 
provided Deseado with an opportunity on March 8, 2007, to remedy the 
defects in its section D questionnaire response and Deseado failed to 
comply with the Department's request for information, we find that the 
information Deaseado submitted is so incomplete that the Department's 
reliance upon it would not result in an accurate measurement or 
reflection of Deseado's selling practices. Therefore, we find that the 
curative provisions of sections 782(d) and (e) are not applicable. In 
addition, we find that Deseado's statement that it is unable to provide 
its own sales data because it cannot obtain other information from its 
supplier does not satisfy the requirements of section 782(c)(1) of the 
Act. Deasado has neither demonstrated the steps it undertook to gather 
the information, nor demonstrated its supplier's unwillingness to 
provide the information, nor suggested alternative or substitutable 
information for use in place of the missing FOP data. Therefore, as 
discussed above, we find that the application of facts available 
pursuant to sections 776(a)(2)(A) and (B) of the Act is warranted in 
calculating a margin for Deseado for these preliminary results.
    We also find, pursuant to section 776(a)(2)(C) of the Act, that it 
appropriate to apply facts available to Deseado because its failure to 
respond to the Department's questionnaires and its failure to provide 
complete FOP data significantly impeded the progress of this 
proceeding. Because Deseado has not provided its FOP data as requested 
by the Department, the Department cannot construct Deseado's NV and, 
therefore, it cannot determine an accurate dumping margin for Deseado. 
In addition, the questionnaire responses that Deseado provided were so 
incomplete that they could not be used by the Department. Therefore, we 
find that the application of the facts available is also warranted, 
pursuant to section 776(a)(2)(C), because Deseado's actions 
significantly impeded the progress of this proceeding.

Use of Adverse Inferences

    In selecting from among facts available, pursuant to section 776(b) 
of the Act, the Department may apply an adverse inference when it has 
determined that a respondent has ``failed to cooperate by not acting to 
the best of its ability to comply with a request for information.'' An 
adverse inference may include reliance on

[[Page 26598]]

information derived from (1) the petition; (2) a final determination in 
the investigation under this title; (3) any previous review under 
section 751 of the Act or determination under section 753 of the Act, 
or (4) any other information on the record. See section 776(b) of the 
Act.
    Congress has noted that 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 Action accompanying the URAA, H.R. Doc. No. 103-316, 
Vol. 1 at 870 (1994) (``SAA''); Mannesmannrohren-Werke AG v. United 
States, 77 F. Supp. 2d 1302 (CIT 1999). The Court of Appeals for the 
Federal Circuit (``the Federal Circuit'') in Nippon Steel Corporation 
v. United States, 337 F. 3d 1373, 1382 (Fed. Cir. 2003) (``Nippon''), 
provided an explanation of the ``failure to act to the best of its 
ability'' standard, stating that the ordinary meaning of ``best'' means 
``one's maximum effort,'' and that the statutory mandate that a 
respondent act to the ``best of its ability'' requires the respondent 
to do the maximum it is able to do. Id. The Federal Circuit 
acknowledged, however, that ``deliberate concealment or inaccurate 
reporting'' would certainly be sufficient to find that a respondent did 
not act to the best of its ability, although it indicated that 
inadequate responses to agency inquiries ``would suffice'' as well. Id. 
Compliance with the ``best of the ability'' standard is determined by 
assessing whether a respondent has put forth its maximum effort to 
provide the Department with full an complete answers to all inquiries 
in an investigation. Id. The Federal Circuit further noted that while 
the standard does not require perfection and recognizes that mistakes 
sometimes occur, it does not condone inattentiveness, carelessness, or 
inadequate record keeping. Id.
    As discussed above, we determine that, within the meaning of 
section 776(b) of the Act, Deseado failed to cooperate by not acting to 
the best of its ability to comply with the Department's multiple 
requests for information and significantly impeded this proceeding, and 
that the application of adverse facts otherwise available (``AFA'') is 
warranted.\12\ The Department finds that Deseado failed to cooperate to 
the best of its ability because it did not respond accurately to the 
Department's questions on such basic information as payment received 
for its POR sales. Furthermore, Deseado provided an unuseable CONNUM to 
compare sales to FOPs, did not provide sales or cost reconciliations, 
and omitted an entire database and narrative description of production 
data consumption for the POR. The information requested by the 
Department can only be supplied by Deseado and cannot be obtained from 
any other sources. Without this information, the Department cannot 
calculate a dumping margin for Deseado. Therefore, the Department finds 
that, by not providing the necessary responses to the questionnaires 
issued by the Department, Deseado has failed to cooperate to the best 
of its ability.
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    \12\ See Cut-to-Length Carbon Steel Plate from the People's 
Republic of China: Final Results and Final Partial Rescission of 
Antidumping Duty Administrative Review, 71 FR 75710 (December 18, 
2006), results unchanged from Cut-to-Length Carbon Steel Plate from 
the People's Republic of China: Notice of Rescission, In Part, and 
Preliminary Results of Antidumping Duty Administrative Review, 71 FR 
45768, 45771 (August 10, 2006) (where the Department stated that 
``...these deficiencies in the revised response, in view of the 
Department's detailed instructions and guidance, indicate that 
Liaoning Company did not act to the best of its ability in providing 
the requested information''); see also Final Results of Antidumping 
Administrative Review: Foundry Coke From the People's Republic of 
China, 69 FR 4108 (January 28, 2004), results unchanged from Notice 
of Preliminary Results of Antidumping Duty Administrative Review: 
Foundry Coke from the People's Republic of China, 68 FR 57869, 57873 
(October 7, 2003).
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    First, because this is an NME proceeding, it is necessary that the 
Department have valid FOP information in order to calculate the NV, as 
stated above. In cases such as this, when we are precluded from 
reviewing the FOPs of the suppliers, and absent any FOP information 
provided, the Department cannot simply create or postulate the costs of 
the uncooperative suppliers. Additionally, the Department has no other 
FOP information on the record. Because Deseado and its supplier have 
failed to provide FOP information for this administrative review, the 
Department cannot properly calculate a dumping margin in accordance 
with section 773(c)(1) of the Act. See Tapered Roller Bearings and 
Parts Thereof, Finished and Unfinished, From the People's Republic of 
China; Final Results of 1997-998 Antidumping Duty Administrative Review 
and Final Results of New Shipper Review, 64 FR 61837, 61846 (November 
15, 1999) (``TRBs-11''); see also Freshwater Crawfish Tail Meat from 
the People's Republic of China; Notice of Final Results of Antidumping 
Duty Administrative Review, 68 FR 19504 (April 21, 2003), and 
accompanying Issues and Decision Memorandum, Comment 7 (``Crawfish''). 
Thus, the Department finds that Deseado and its supplier have not acted 
to the best of their ability.
    Second, Deseado and its supplier have failed to provided any 
explanation why they were unable provide the FOP information, nor did 
they offer any alternative forms by which they might be able to comply 
with the Department's requests. As the Federal Circuit has held, a 
respondent must ``put forth its maximum efforts'' in complying with the 
Department's requests. See Nippon, 337 F.3d at 1382.
    Additionally, it has been the Department practice to apply adverse 
facts available when a respondent has failed to provide convincing 
evidence ``claiming that their suppliers cannot supply requested 
factors of production information.'' See Creatine from the PRC, 64 FR 
at 71108 (applying adverse facts available because the respondent did 
not provide an acceptable explanation on the record for its suppliers 
failure to provide the FOP information); see also TRBs-11, 64 FR at 
61846 (finding that the respondent did not act to the best of its 
ability when it was unable to provide letters from unrelated suppliers 
stating their unwillingness to supply factors of production 
information); see also Notice of Fresh Garlic From the People's 
Republic of China: Final Results of Antidumping Duty New Shipper 
Review, 68 FR 36767, 36768 (June 19, 2003) (``Garlic'') (applying 
adverse facts available when a supplier stated that it was unwilling to 
provide details on its production process or its FOPs; and the 
respondent did not provide an explanation as to why it or its supplier 
could not provide the FOP information); see also Notice of Certain 
Cased Pencils from the People's Republic of China; Final Results and 
Partial Rescission of Antidumping Duty Administrative Review, 67 FR 
48612 (July 25, 2002), and accompanying Issues and Decision Memorandum, 
at Comment 10 (finding that there was no acceptable explanation on the 
record for the supplier's failure to provide factor of production 
information, an adverse inference in applying facts available was 
warranted due to the supplier's failure to act to the best of its 
ability).
    Although Deseado claimed that it attempted to obtain the 
information from its supplier, it is ultimately Deseado's 
responsibility for submitting accurate FOP information, as it is the 
party that is seeking the rate based on the FOP information and it is 
more readily available to them, and any ``failures, even if made by a 
supplier, may provide grounds for the application of adverse facts 
available.'' See

[[Page 26599]]

Crawfish, 68 FR at 19504; see also Garlic, 68 FR at 36768.
    Therefore, pursuant to section 776(b) of the Act, we are 
preliminarily applying the AFA rate to Deseado's sales of subject 
merchandise to the United States during the POR. In the instant 
proceeding, we find it appropriate to use an inference that is adverse 
to the interests of Deseado in selecting from among the facts otherwise 
available because Deseado failed to comply with the Department's 
request for sales and cost data required in the original questionnaire 
and its subsequent failure to provide corrected data upon the second 
opportunity to do so, despite the Department's specific and detailed 
explanations within the March 8, 2007, letter. See, e.g. Final 
Determination of Sales at Less Than Fair Value: Certain Activated 
Carbon from the People's Republic of China, 72 FR 9508 (March 2, 2007) 
and accompanying Issues and Decision Memorandum at Comment 27 (where 
``the Department found that Jilin Bright Future failed to cooperate to 
the best of its ability to comply with the Department's request for 
information''). Deseado failed to provide the Department with complete 
or revised responses during this administrative review and the 
application of total AFA in this case is appropriate because it should 
not be rewarded for its noncompliance. See, e.g., Ta Chen Stainless 
Steel Pipe, Inc. v. United States, 298 F.3d 1330, 1340 (Fed. Cir. 
2002). Accordingly, we are applying as AFA the rate of 108.3 percent, 
the highest calculated rate from any segment of this proceeding. See 
the ``Corroboration'' section below for a discussion of the probative 
value of the 108.30 percent rate.

Corroboration

    Section 776(c) of the Act provides that, when the Department relies 
on secondary information rather than on information obtained in the 
course of an investigation or review, it shall, to the extent 
practicable, corroborate that information from independent sources that 
are reasonably at its disposal. As described in the SAA, it is the 
Department's practice to use secondary information from the petition, 
the final determination, or any previous review under section 751 
concerning the subject merchandise. See SAA at 870. The Department will 
satisfy itself that the secondary information has probative value and, 
to the extent practicable, will examine the reliability and relevance 
of the information to be used.
    The AFA rate being assigned to Deseado (108.30 percent) is the 
highest calculated rate determined in any segment of this proceeding 
(the 2001-2002 administrative review). See Amended Notice of Final 
Results of the Antidumping Duty Administrative Review: Petroleum Wax 
Candles from the People's Republic of China (``Amended Final'') 69 FR 
20858 (April 19, 2004). This rate was corroborated in the most recently 
completed new shipper review subsequent to the Amended Final. See 
Notice of Final Results of the Antidumping Duty New Shipper Review: 
Petroleum Wax Candles from the People's Republic of China (``2002-2003 
New Shipper Review'') 69 FR 77990 (December 29, 2004). Furthermore, no 
information has been presented in the current review that calls into 
question the reliability of this information. We note that this is the 
highest rate from any segment of the proceeding and the rate is less 
than four years old. Thus, the Department finds that the information 
continues to be reliable.
    With respect to the relevance aspect of corroboration, the 
Department will consider information reasonably at its disposal to 
determine whether a margin continues to have relevance. Where 
circumstances indicate that the selected margin is not appropriate as 
AFA, the Department will disregard the margin and determine an 
appropriate margin. For example, in Fresh Cut Flowers from Mexico: 
Final Results of Antidumping Administrative Review, 61 FR 6812 at 
Comment 4 (February 22, 1996), the Department disregarded the highest 
margin in that case as adverse best information available (the 
predecessor to ``facts available'') because the margin was based on 
another company's uncharacteristic business expense resulting in an 
unusually high margin. Similarly, the Department does not apply a 
margin that has been judicially invalidated. See D&L Supply Co. v. 
United States, 113 F.3d 1220, 1221 (Fed. Cir. 1997) (the Department 
will not use a margin that has been judicially invalidated). The 
information used in calculating this margin was based on sales and 
production data submitted by the respondents in the 2001-2002 
administrative review, together with the most appropriate surrogate 
value information available to the Department, chosen from submissions 
by the parties in the 2001-2002 administrative review, as well as 
gathered by the Department itself. Furthermore, the calculation of this 
margin was subject to comment from interested parties in the 
proceeding. Moreover, as there is no information on the record of this 
review that demonstrates that this rate is not appropriately used as 
AFA, we determine that this rate has relevance.
    Based on our analysis, we find that the margin of 108.30 percent is 
reliable and has relevance. As the rate is both reliable and relevant, 
we determine that it has probative value. Accordingly, we determine 
that the calculated rate of 108.30 percent, which is the current PRC-
wide rate, is in accordance with the requirement of section 776(c) of 
the Act that secondary information be corroborated (that it have 
probative value). Consequently, we have assigned this AFA rate to 
exports of the subject merchandise from Deseado.

Preliminary Results of Review

    We preliminarily determine that the following margin exists during 
the period August 1, 2005, through July 31, 2006:

                   Petroleum Wax Candles from the PRC
------------------------------------------------------------------------
                                                       Weighted-Average
                Manufacturer/Exporter                  Margin (Percent)
------------------------------------------------------------------------
Deseado Industrial Co., Ltd.........................              108.30
------------------------------------------------------------------------

Public Comment

    The Department will disclose to parties of this proceeding the 
information utilized in reaching the preliminary results within ten 
days of the date of announcement of the preliminary results. An 
interested party may request a hearing within 30 days of publication of 
the preliminary results. See 19 CFR 351.310(c). Interested parties may 
submit written comments (case briefs) within 30 days of publication of 
the preliminary results and rebuttal comments (rebuttal briefs), which 
must be limited to issues raised in the case briefs, within five days 
after the time limit for filing case briefs. See 19 CFR 
351.309(c)(1)(ii) and 19 CFR 351.309(d). Parties who submit arguments 
are requested to submit with the argument: (1) A statement of the 
issue; (2) a brief summary of the argument; and (3) a table of 
authorities. Further, the Department requests that parties submitting 
written comments provide the Department with a diskette containing the 
public version of those comments. Unless the deadline is extended 
pursuant to section 751(a)(3)(A) of the Act, the Department will issue 
the final results of this administrative review, including the results 
of our analysis of the issues raised by the parties in their comments, 
within 120 days of publication of the preliminary results. The 
assessment of antidumping duties on entries of

[[Page 26600]]

merchandise covered by this review and future deposits of estimated 
duties shall be based on the final results of this review.

Assessment Rates

    Upon issuance of the final results, the Department will determine, 
and CBP shall assess, antidumping duties on all appropriate entries. 
The Department intends to issue assessment instructions to CBP 15 days 
after the date of publication of the final results of review. If these 
preliminary results are adopted in our final results of review, the 
Department shall determine, and CBP shall assess, antidumping duties on 
all appropriate entries. Pursuant to 19 CFR 351.212(b)(1), we will 
calculate importer-specific (or customer) ad valorem duty assessment 
rates based on the ratio of the total amount of the dumping margins 
calculated for the examined sales to the total entered value of those 
same sales. We will instruct CBP to assess antidumping duties on all 
appropriate entries covered by this review if any importer-specific 
assessment rate calculated in the final results of this review is above 
de minimis.

Cash Deposit Requirements

    The following cash deposit requirements, when imposed, 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 
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; (2) for all PRC exporters of subject merchandise which have not 
been found to be entitled to a separate rate, the cash deposit rate 
will be the PRC-wide rate of 108.30 percent; and (3) the cash deposit 
rate for all non-PRC exporters (including Deseado) of subject 
merchandise which have not received their own rate, the cash deposit 
rate will be the rate applicable to the PRC exporters that supplied 
that non-PRC exporter. These deposit requirements, when imposed, shall 
remain in effect until publication of the final results of the next 
administrative review.

Notification to Importers

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

    Dated: May 2, 2007
David A. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E7-9040 Filed 5-9-07; 8:45 am]
BILLING CODE 3510-DS-S