[Federal Register Volume 73, Number 189 (Monday, September 29, 2008)]
[Notices]
[Pages 56550-56553]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-22885]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-831]


Fresh Garlic from the People's Republic of China: Final Results 
and Rescission, In Part, of Twelfth New Shipper Reviews

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

EFFECTIVE DATE: September 29, 2008.
SUMMARY: On May 1, 2008, the Department of Commerce (the 
``Department'') published the preliminary results of these new shipper 
reviews, covering the period November 1, 2006, through April 30, 
2007.\1\ See Fresh Garlic from the People's Republic of China: 
Preliminary Results of the 12th New Shipper Reviews, 73 FR 24042 (May 
1, 2008) (``Preliminary Results''). Based on our analysis of the 
comments received, we have made certain changes to our calculations. 
The final dumping margins for these reviews are listed in the ``Final 
Results of the Reviews'' section below. Finally, after reexamining the 
bona fides of Shandong Chenhe International Trading Co., Ltd.'s 
(``Chenhe'') single sale, the Department finds that that sale is not a 
bona fide transaction; therefore, for these final results, the 
Department has rescinded the review with respect to Chenhe.
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    \1\ We extended the end of the period of review (``POR'') from 
April 30, 2007 to May 17, 2007, to capture entries for two 
respondents. See the ``Expansion of the POR'' section in the 
Preliminary Results.

FOR FURTHER INFORMATION CONTACT: Paul Walker and Blaine Wiltse, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14\th\ Street and Constitution Avenue, NW, Washington, DC 
20230; telephone: (202) 482-0413 or (202) 482-6345, respectively.

Case History

Background

    The Department conducted a verification of Chenhe from May 12-14, 
2008. The Department conducted a verification of Jining Yongjia Trade 
Co., Ltd. (``Yongjia'') and its supplier Jinxiang County Shanfu Frozen 
Co. Ltd. (``Shanfu'') from May 15-18, 2008.
    On July 7, 2008, we extended the time limit for the completion of 
the final results of these reviews. See Fresh Garlic from the People's 
Republic of China: Notice of Extension of Time Limits for the Final 
Results of the Twelfth New Shipper Reviews, 73 FR 38396 (July 7, 2008).

[[Page 56551]]

    On July 8, 2008, we received case briefs from Yongjia, Chenhe, 
Hebei Golden Bird Trading Co., Ltd. (``Golden Bird''), Qingdao 
Tiantaixing Foods Co., Ltd. (``QTF'') and the Petitioners.\2\ On July 
16, 2008 we received timely rebuttal briefs from Chenhe. On August 29, 
2008, we reopened the record and provided parties an opportunity to 
comment on certain U.S. Customs and Border Protection (``CBP'') data. 
On September 3, 2008, we received a supplemental brief from Chenhe with 
regard to the CBP data, in which Chenhe corrected the entered value of 
its single POR sale. On September 4, 2008, we received a supplemental 
brief from the Petitioners with regard to the CBP data. On September 8, 
2008, we received rebuttals to the supplemental briefs from Chenhe and 
the Petitioners with regard to the CBP data.
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    \2\ The Fresh Garlic Producers Association and its individual 
members: Christopher Ranch LLC, the Garlic Company, Valley Garlic 
and Vessey and Company, (collectively known as the ``Petitioners'').
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Analysis of Comments Received

    All issues raised in the case, rebuttal, and supplemental briefs by 
parties to these reviews are addressed in the ``New Shipper Reviews of 
Fresh Garlic from the People's Republic of China: Issues and Decision 
Memorandum,'' dated September 19, 2008, which is hereby adopted by this 
notice (``Issues and Decision Memo''). A list of the issues which 
parties raised and to which we respond in the Issues and Decision Memo 
is attached to this notice as an Appendix. The Issues and Decision Memo 
is a public document and is on file in the Central Records Unit 
(``CRU''), Main Commerce Building, Room 1117, and is accessible on the 
Web at http://www.trade.gov/ia. The paper copy and electronic version 
of the memorandum are identical in content.

Changes Since the Preliminary Results

    Based on our analysis of information on the record of these 
reviews, and comments received from the interested parties, we have 
made changes to the margin calculations for all Respondents.\3\ For the 
final results, we will continue to use regression-based wage data, but 
will use US $1.04 as the revised wage for the PRC in the final results, 
which continues to be based on the reported experience of several 
countries, but applies the more recent 2007 calculations, which are 
based on 2005 wage rate data.\4\ The Department published the 2007 Wage 
Rates, notifying parties of the finalized NME wage rates and informing 
parties that those wage rates would be ``in effect for all antidumping 
proceedings for which the Department's final decision is due after the 
publication of this notice.''\5\
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    \3\ Yongjia, Chenhe, Golden Bird, QTF and Shenzhen Greening 
Trading Co., Ltd.
    \4\ See http://ia.ita.doc.gov/wages/05wages/05wages-051608.html; 
see also Corrected 2007 Calculation of Expected Non-Market Economy 
Wages, 73 FR 27795 (May 14, 2008) (``Corrected 2007 Wages'').
    \5\ Corrected 2007 Wages, 73 FR at 27795 (correcting a 
ministerial error in the wage rate calculation).
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    In addition, we have incorporated a post-preliminary results 
clarification/correction to the margin calculations, with respect to 
mesh bags, for Yongjia, Golden Bird, QTF and Greening. For further 
details on this company-specific change, see Issues and Decision Memo 
at Comment 5 and the company-specific analysis memoranda.

Partial Rescission of Administrative Review

    In the Preliminary Results, the Department found that Chenhe's 
single POR sale was made on a bona fide basis. However, in light of the 
correction to Chenhe's entered value and the resulting reanalysis of 
Chenhe's third-country sales, the additional CBP data placed on the 
record of this review, and the comments from the Petitioners and 
Chenhe, the Department has reevaluated the circumstances surrounding 
Chenhe's POR transaction and finds that the sale in question is not a 
bona fide transaction. In the Preliminary Results, the Department 
relied on an inappropriate HTSUS subcategory, 0703.20.0020: FRESH 
PEELED GARLIC, to perform its analysis of Chenhe's single POR sale. For 
the final results, the Department finds that the CBP quantity and value 
data for imports of garlic under the HTSUS subcategory 0703.20.0010, 
``GARLIC, FRESH WHOLE BULBS'' provides an appropriate comparison to 
Chenhe's sale because the data is more specific to the subject 
merchandise sold by Chenhe, and thus, the Department has analyzed the 
CBP data accordingly. As a result of our analysis of the additional CBP 
data and third-country sales in comparison to Chenhe's corrected 
entered value, we have concluded that the single sale made by Chenhe 
during the POR is not a bona fide commercial transaction based on the 
totality of circumstances: (a) the high price and low quantity of 
Chenhe's single POR sale; and, (b) other indicia of a non-bona fide 
transaction. In sum, the totality of circumstances leads the Department 
to find that Chenhe's single POR sale is a non-bona fide commercial 
transaction. Therefore, this sale does not provide a reasonable or 
reliable basis for calculating a dumping margin. As Chenhe had no other 
sales of subject merchandise during the instant POR, the Department is 
rescinding the new shipper review with respect to Chenhe. For further 
discussion of this issue, see Comment 1 of the Issues and Decision 
Memorandum; see also Memorandum to James Doyle, Director, Office 9, 
through Catherine Bertrand, Program Manager, Office 9, from Blaine 
Wiltse, Analyst, Regarding; Final BPI Evidence of Shandong Chenhe 
International Trading Co., Ltd.: New Shipper Review of Fresh Garlic 
from the People's Republic of China, dated September 19, 2008.

Scope of the Order

    The products covered by this antidumping duty order are all grades 
of garlic, whole or separated into constituent cloves, whether or not 
peeled, fresh, chilled, frozen, provisionally preserved, or packed in 
water or other neutral substance, but not prepared or preserved by the 
addition of other ingredients or heat processing. The differences 
between grades are based on color, size, sheathing, and level of decay. 
The scope of this order does not include the following: (a) Garlic that 
has been mechanically harvested and that is primarily, but not 
exclusively, destined for non-fresh use; or (b) garlic that has been 
specially prepared and cultivated prior to planting and then harvested 
and otherwise prepared for use as seed. The subject merchandise is used 
principally as a food product and for seasoning. The subject garlic is 
currently classifiable under subheadings 0703.20.0010, 0703.20.0020, 
0703.20.0090, 0710.80.7060, 0710.80.9750, 0711.90.6000 and 2005.90.9700 
of the Harmonized Tariff Schedule of the United States (``HTSUS''). 
Although the HTSUS subheadings are provided for convenience and customs 
purposes, our written description of the scope of this order is 
dispositive. In order to be excluded from the antidumping duty order, 
garlic entered under the HTSUS subheadings listed above that is (1) 
mechanically harvested and primarily, but not exclusively, destined for 
non-fresh use or (2) specially prepared and cultivated prior to 
planting and then harvested and otherwise prepared for use as seed must 
be accompanied by declarations to CBP to that effect.

Normal Value Methodology

    The Department's general policy, consistent with section 773(c)(1) 
of the Tariff Act of 1930, as amended (the ``Act''), is to calculate 
normal value (``NV'') for non-market economy companies using the 
factors of

[[Page 56552]]

production (``FOP'') that a respondent consumes in order to produce a 
unit of the subject merchandise. There are circumstances, however, in 
which the Department will modify its standard FOP methodology, choosing 
to apply a surrogate value to an intermediate input instead of the 
individual FOPs used to produce that intermediate input. First, in some 
cases, a respondent may report factors used to produce an intermediate 
input that account for an insignificant share of total output. When the 
potential increase in accuracy to the overall calculation that results 
from valuing each of the FOPs is outweighed by the resources, time, and 
burden such an analysis would place on all parties to the proceeding, 
the Department will value the intermediate input directly using a 
surrogate value. See, e.g., Notice of Final Antidumping Duty 
Determination of Sales at Less Than Fair Value and Affirmative Critical 
Circumstances: Certain Frozen Fish Fillets from the Socialist Republic 
of Vietnam, 68 FR 37116 (June 23, 2003) (``Fish Fillets'') and 
accompanying Issues and Decision Memorandum at Comment 3.
    Also, there are circumstances in which valuing the FOPs used to 
yield an intermediate product would lead to an inaccurate result 
because the Department would not be able to account for a significant 
element of cost adequately in the overall factors buildup. In this 
situation, the Department would also value the intermediate input 
directly. See, e.g., Fresh Garlic from the People's Republic of China: 
Final Results and Partial Rescission of Antidumping Duty Administrative 
Review and Final Results of New Shipper Reviews, 71 FR 26329 (May 4, 
2006) and accompanying Issues and Decision Memorandum at Comment 1.
    In the Preliminary Results, we found that Yongjia was unable to 
accurately record and substantiate the complete costs of growing garlic 
based on our analysis of the information on the record. See Preliminary 
Results; see also Memorandum to James C. Doyle, Director, Office 9, 
through Catherine Bertrand, Program Manager, Office 9 from Paul Walker, 
Analyst, ``12\th\ New Shipper Review of Fresh Garlic from the People's 
Republic of China: Intermediate Input Methodology,'' dated April 22, 
2008 (``Intermediate Product Memo''). In order to eliminate the 
distortions in our calculation of NV for all of the reasons identified 
in the Intermediate Product Memo, we have applied an intermediate-
product valuation methodology to Yongjia for these final results of 
review. Using this methodology, we calculated NV by starting with a 
surrogate value for the garlic bulb (i.e., the ``intermediate 
product''), adjusted for yield losses during the processing stages, and 
added Yongjia's processing costs, which were calculated using their 
reported usage rates for processing fresh garlic. In future reviews, 
should a respondent be able to provide sufficient factual evidence that 
it maintains the necessary information in its internal books and 
records that would allow us to establish the completeness and accuracy 
of the reported FOPs, we will revisit this issue and consider whether 
to use its reported FOPs in the calculation of NV. For further details, 
see Intermediate Product Memo.
    We note that for the other respondents (Golden Bird, Greening, and 
QTF) the Department did not apply the intermediate product methodology 
because these respondents only processed purchased garlic and did not 
grow their own garlic. For a complete explanation of the Department's 
analysis, and for a more detailed analysis of these issues with respect 
to Yongjia, see Intermediate Product Memo and Issues and Decision Memo 
at Comment 2.

Final Results of the New Shipper Reviews

    The Department has determined that the following final dumping 
margins exist for the period November 1, 2006, through April 30, 2007:

                        Fresh Garlic from the PRC
------------------------------------------------------------------------
                                                            Weighted-
                 Exporter/Manufacturer                    Average Margin
                                                            (Percent)
------------------------------------------------------------------------
Exported and Produced by Shenzhen Greening Trading Co.,           2.12
 Ltd...................................................
Exported and Produced by Qingdao Tiantaixing Foods Co.,          32.78
 Ltd...................................................
Exported by Hebei Golden Bird Trading Co., Ltd. and              13.83
 Produced by Cangshan County Hongyang Vegetables &
 Foods Co., Ltd........................................
Exported by Jining Yongjia Trade Co., Ltd. and Produced          18.88
 by Jinxiang County Shanfu Frozen Co., Ltd.............
------------------------------------------------------------------------

    The Department will disclose calculations performed for these final 
results to the parties within five days of the date of publication of 
this notice in accordance with 19 CFR 351.224(b).

Assessment Rates

    Consistent with the final results of review on the antidumping duty 
order of fresh garlic from the PRC for the period November 1, 2002, 
through October 31, 2003, we will direct CBP to assess importer-
specific assessment rates based on the resulting per-unit (i.e., per 
kilogram) amount on each entry of the subject merchandise during the 
POR. See Fresh Garlic from the People's Republic of China: Final 
Results of Antidumping Duty Administrative Review, 70 FR 34082 (June 
13, 2005) (``Garlic 10\th\ AR Final''). Therefore, the Department will 
determine, and CBP shall assess, antidumping duties on all appropriate 
entries. The Department will issue appropriate assessment instructions 
directly to CBP 15 days after publication of the final results of this 
review. For assessment purposes, we calculated importer-specific 
assessment rates for fresh garlic from the PRC. Specifically, we 
divided the total dumping margins for each importer by the total 
quantity of subject merchandise sold to that importer during the POR to 
calculate a per-unit assessment amount. We will direct CBP to assess 
importer-specific assessment rates based on the resulting per-unit 
(i.e., per kilogram) amount on each entry of the subject merchandise 
during the POR if any importer-specific assessment rate calculated in 
the final results of this review is above de minimis.

Cash Deposit Requirements

    Consistent with Garlic 10\th\ AR Final we will establish and 
collect a per-kilogram cash- deposit amount which will be equivalent to 
the company-specific dumping margin published in those future reviews. 
Specifically, the following deposit requirement will be effective upon 
completion of subsequent review segments of this proceeding for all 
shipments of the subject merchandise entered, or withdrawn from 
warehouse, for consumption on or after the publication date of the 
final results, as provided by section 751(a)(2)(C) of the Act: (1) for 
subject merchandise produced and exported by QTF, produced and exported 
by Greening, produced by Hongyang and exported by Golden Bird, or 
produced by Shanfu and exported by Yongjia, the cash deposit rate will 
be the company-specific rate shown above (except that if the rate for a 
particular company is de minimis, i.e., less than 0.5 percent, no cash 
deposit will be required for that company); (2) for subject merchandise 
exported by QTF or Greening but not manufactured by QTF or Greening,

[[Page 56553]]

respectively, for subject merchandise exported by Golden Bird but not 
manufactured by Hongyang, and for subject merchandise exported by 
Yongjia but not manufactured by Shanfu, the cash deposit rate will 
continue to be the PRC-wide rate (i.e., 376.67 percent); and (3) for 
subject merchandise manufactured by QTF or Greening, but exported by 
any other party, the cash deposit rate will be the rate applicable to 
the exporter. These cash deposit requirements will remain in effect 
until further notice.

Reimbursement of Duties

    This notice also serves as a final reminder to importers of their 
responsibility under 19 CFR 351.402(f) to file a certificate regarding 
the reimbursement of antidumping duties prior to liquidation of the 
relevant entries during this POR. Failure to comply with this 
requirement could result in the Department's presumption that 
reimbursement of antidumping duties has occurred and the subsequent 
assessment of doubled antidumping duties.

Notification of Interested Parties

    This notice serves as a final 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 the review period. Pursuant to 19 CFR 
351.402(f)(3), failure to comply with this requirement could result in 
the Department's presumption that reimbursement of antidumping duties 
occurred and the subsequent assessment of doubled antidumping duties.
    This notice also serves as a reminder to parties subject to 
administrative protective order (``APO'') of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO as explained in the administrative protective order itself. Timely 
written notification of the return/destruction of APO materials or 
conversion to judicial protective order is hereby requested. Failure to 
comply with the regulations and the terms of an APO is a sanctionable 
violation.
    This notice of final results and rescission, in part, of these new 
shipper reviews are issued and published in accordance with sections 
751(a)(2)(C) and 777(i) of the Act and 19 CFR 351.221(b)(5).

    Dated: September 19, 2008.
David M. Spooner,
Assistant Secretary for Import Administration.

Appendix I

    Comment 1: Bona Fide Analysis of Chenhe's Sale
    Comment 2: Intermediate Input Methodology
    Comment 3: Surrogate Financial Ratios
    Comment 4: Garlic Bulb Surrogate Value
    Comment 5: Mesh Bags
    Comment 6: Containerization
[FR Doc. E8-22885 Filed 9-26-08; 8:45 am]
BILLING CODE 3510-DS-S