Certain Frozen Warmwater Shrimp From the People's Republic of China: Notice of Final Results and Rescission, in Part, of 2004/2006 Antidumping Duty Administrative and New Shipper Reviews

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

On March 9, 2007, the Department of Commerce (“the Department”) published the preliminary results of its administrative and new shipper reviews of the antidumping duty order on certain frozen warmwater shrimp from the People's Republic of China (“PRC”). See Certain Frozen Warmwater Shrimp From the People's Republic of China: Preliminary Results and Partial Rescission of the 2004/2006 Administrative Review and Preliminary Intent To Rescind 2004/2006 New Shipper Review, 72 FR 10645 (March 9, 2007) (Preliminary Results). Based on our analysis of the record, including information obtained since the preliminary results, we have made changes to the margin calculations for Yelin Enterprise Co. Hong Kong, and its affiliates. See Final Results of Review section, below.

EFFECTIVE DATE:

September 12, 2007.

FOR FURTHER INFORMATION CONTACT:

Scot Fullerton or Erin Begnal, 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) 482-1386 or (202) 482-1442, respectively.

Background

On March 9, 2007, the Department of Commerce (“the Department”) published the preliminary results of its administrative and new shipper reviews of the antidumping duty order on certain frozen warmwater shrimp from the PRC, and invited parties to comment on the preliminary results. See Preliminary Results. The administrative review covers the following companies: (1) Yelin Enterprise Co., Ltd. Hong Kong (“Yelin”); (2) Allied Pacific Aquatic Products (Zhangjiang) Co., Ltd. (“Allied Pacific (Zhangjiang)”); (3) Allied Pacific (H.K.) Co., Ltd. (“Allied Pacific Hong Kong”); (4) Shantou Red Garden Foodstuff/Shantou Red Garden Food Processing Co. (collectively, “Red Garden”), (5) Meizhou Aquatic Products Quick-Frozen Industry Co., Ltd. (“Meizhou”); (6) Zhoushan Huading Seafood Co., Ltd. (“Huading”); (7) Asian Seafoods (Zhanjiang) Co. (“Asian Seafoods”); and (8) Zhanjiang Evergreen Aquatic Product Science and Technology Co., Ltd. (“Evergreen”). The new shipper review covers one producer/exporter: Hai Li Aquatic Co., Ltd. Zhao An, Fujian (“Hai Li”). See Preliminary Results. The period of review (“POR”) for both the administrative and new shipper reviews is July 16, 2004, through January 31, 2006.

On March 22, 2007, we issued a supplemental questionnaire to Yelin, and received Yelin's response on April 5, 2007. On April 16, 2007, we received a case brief on behalf of the petitioner, the Ad Hoc Shrimp Trade Action Committee, re-submitted on April 30, 2007. In addition, we received a case brief on behalf of Asian Seafoods on April 23, 2007. Additionally, we received a case brief on behalf of Allied Pacific Food (Dalian) Co., Ltd., Allied Pacific Aquatic Products (Zhanjiang) Co., Ltd., Zhanjiang Allied Pacific Aquaculture Co., Ltd., Allied Pacific (H.K.) Co., Ltd., and King Royal Investments, Ltd., (collectively, “Allied Pacific Group”) on April 23, 2007. We also received a case brief on behalf of Yelin Enterprise Co. Hong Kong and its affiliates, Shantou Yelin Frozen Seafood Co., Ltd., Yangjiang City Yelin Hoi Tat Quick Frozen Seafood Co., Ltd., Fuqing Yihua Aquatic Food Co., Ltd., Fuqing Minhua Trading Co., Ltd., and Ocean Duke Corporation (collectively, “Yelin”) on April 23, 2007. We also received a case brief on April 23, 2007, on behalf of Zhanjiang Guolian Aquatic Products Co., Ltd., an interested party. On May 7, 2007, and on May 8, 2007, we received rebuttal briefs from the petitioner, Asian Seafoods, and Yelin.

Scope of the Order

The scope of this order includes certain frozen warmwater shrimp and prawns, whether wild-caught (ocean harvested) or farm-raised (produced by aquaculture), head-on or head-off, shell-on or peeled, tail-on or tail-off, deveined or not deveined, cooked or raw, or otherwise processed in frozen form.

The frozen warmwater shrimp and prawn products included in the scope of this investigation, regardless of definitions in the Harmonized Tariff Schedule of the United States (“HTS”), are products which are processed from warmwater shrimp and prawns through freezing and which are sold in any count size.

The products described above may be processed from any species of warmwater shrimp and prawns. Warmwater shrimp and prawns are generally classified in, but are not limited to, the Penaeidae family. Some examples of the farmed and wild-caught warmwater species include, but are not limited to, white-leg shrimp (Penaeus vannemei), banana prawn (Penaeus merguiensis), fleshy prawn (Penaeus chinensis), giant river prawn (Macrobrachium rosenbergii), giant tiger prawn (Penaeus monodon), redspotted shrimp (Penaeus brasiliensis), southern brown shrimp (Penaeus subtilis), southern pink shrimp (Penaeus notialis), southern rough shrimp (Trachypenaeus curvirostris), southern white shrimp (Penaeus schmitti), blue shrimp (Penaeus stylirostris), western white shrimp (Penaeus occidentalis), and Indian white prawn (Penaeus indicus).

Frozen shrimp and prawns that are packed with marinade, spices or sauce are included in the scope of this investigation. In addition, food preparations, which are not “prepared meals,” that contain more than 20 percent by weight of shrimp or prawn are also included in the scope of this investigation.

Excluded from the scope are: (1) Breaded shrimp and prawns ( HTS subheading 1605.20.10.20); (2) shrimp and prawns generally classified in the Pandalidae family and commonly referred to as coldwater shrimp, in any state of processing; (3) fresh shrimp and prawns whether shell-on or peeled (HTS subheadings 0306.23.00.20 and 0306.23.00.40); (4) shrimp and prawns in prepared meals (HTS subheading 1605.20.05.10); (5) dried shrimp and prawns; (6) Lee Kum Kee's shrimp sauce; (7) canned warmwater shrimp and prawns (HTS subheading 1605.20.10.40); (8) certain dusted shrimp; and (9) certain battered shrimp. Dusted shrimp is a shrimp-based product: (1) That is produced from fresh (or thawed-from-frozen) and peeled shrimp; (2) to which a “dusting” layer of rice or wheat flour of at least 95 percent purity has been applied; (3) with the entire surface of the shrimp flesh thoroughly and evenly coated with the flour; (4) with the non-shrimp content of the end product constituting between four and 10 percent of the product's total weight after being dusted, but prior to being frozen; and (5) that is subjected to individually quick frozen (“IQF”) freezing immediately after application of the dusting layer. Battered shrimp is a shrimp-based product that, when dusted in accordance with the definition of dusting above, is coated with a wet viscous layer containing egg and/or milk, and par-fried.

The products covered by this investigation are currently classified under the following HTS subheadings: 0306.13.00.03, 0306.13.00.06, 0306.13.00.09, 0306.13.00.12, 0306.13.00.15, 0306.13.00.18, 0306.13.00.21, 0306.13.00.24, 0306.13.00.27, 0306.13.00.40, 1605.20.10.10, and 1605.20.10.30. These HTS subheadings are provided for convenience and for customs purposes only and are not dispositive, but rather the written description of the scope of this investigation is dispositive.

Separate Rates

Yelin, Allied Pacific (Hong Kong), Allied Pacific (Zhanjiang), and Evergreen have requested separate, company-specific antidumping duty rates. In our preliminary results, we found that they had each met the criteria for the application of a separate antidumping duty rate. See Preliminary Results. We have not received any information since the Preliminary Results with respect to Yelin, Allied Pacific (Hong Kong), Allied Pacific (Zhanjiang), and Evergreen which would warrant reconsideration of our separate-rates determinations with respect to these companies. Therefore, for these final results, we will continue to calculate company-specific separate rates for these respondents.

Partial Rescission of Administrative Review

In the Preliminary Results, the Department issued a notice of intent to rescind the administrative review with respect to several companies that indicated they did not export certain frozen warmwater shrimp to the United States during the POR. Those companies are: Baofa Aquatic Products Co., Ltd.; Guangzhou Lingshan Aquatic Products; Ruian Huasheng Aquatic Products; Sealord North America; Shantou Ocean Freezing Industry and Trade General Corporation; Spectrum Plastics; Taizhou Zhonghuan Industrial Co., Ltd.; Yantai Xinlai Trade; Zhejiang Daishan Baofa Aquatic Products Co., Ltd.; Zhejiang Evernew Seafood Co., Ltd.; Zhejiang Zhenlong Foodstuffs Co., Ltd.; Zhoushan Guotai Aquatic Products Co., Ltd. (AKA Zhoushan Guotai Fisheries Co., Ltd.); Zhoushan Haichang Food Co.; Zhoushan Industrial Co., Ltd.; Zhoushan Putuo Huafa Sea Products Co., Ltd.; and Zhoushan Zhenyang Developing Co., Ltd.

The Department is also rescinding the administrative review with respect to the following entities because the Department's quantity and value questionnaires sent to these companies were returned with undeliverable addresses: Allied Pacific Food; Allied Pacific Aquatic Products (Zhongshan) Co., Ltd.;³ Dhin Foong Trdg; Dongri Aquatic Products Freezing Plants Shengping; Dongshan Xinhefa Food; Evergreen Aquatic Product Science and Technology; Formosa Plastics; Fuchang Trdg; Fuqing City Dongyi Trdg; Fuqing Chaohui Aquatic Food Co., Ltd., Fuqing Chaohui Aquatic Food Trdg.; Fuqing Dongyi Trading; Fuqing Fuchang Trading; Fuqing Longwei Aquatic Foodstuff; Fuqing Xuhu Aquatic Food Trdg; Gaomi Shenyuan Foodstuff; Guangxi Lian Chi Home Appliance Co; Hainan Jiadexin Aquatic Products Co., Ltd.; I T Logistics; Juxian Zhonglu Foodstuffs; Logistics Harbour Dock; Longwei Aquatic Foodstuff; Master International Logistics; Meizhou Aquatic Products; Nichi Lan Food Co. Ltd. Chen Hai; P&T International Trading; Perfection Logistics Service; Phoenix Seafood; Putuo Fahua Aquatic Products Co., Ltd.; Qingdao Dayang Jian Foodstuffs; Qinhuangdao Jiangxin Aquatic Food; Round the Ocean Logistics; Seatrade International; Second Aquatic Food; Second Aquatic Foodstuffs Fty; Shandong Chengshun Farm Produce Trd; Shandong Sanfod Group; Shantou Junyuan Pingyuan Foreign Trading; Shantou Sez Xuhoa Fastness Freeze Aquatic Factory; South Bay Intl; Taizhou Lingyang Aquatic Products Co., Ltd.; Tianhe Hardware & Rigging; Xiamen Sungiven Imports & Exports; Yantai Guangyuan Foods Co; Yantai Xuehai Foodstuffs; Yelin Frozen Seafood Co.; Zhanjiang CNF Sea Products Engineering, Ltd; Zhanjiang Fuchang Aquatic Products; Zhanjiang Jebshin Seafood Limited; Zhanjiang Shunda Aquatic Products; Zhejiang Zhongda; Zhejiang Taizhou Lingyang Aquatic Products Co.; Zhoushan Guangzhou Aquatic Products Co., Ltd.; Zhoushan International Trade Co., Ltd.; Zhoushan Provisions & Oil Food Export and Import Co., Ltd.; Zhoushan Xi'an Aquatic Products Co., Ltd.; and ZJ CNF Sea Products Engineering, Ltd. The Department sent quantity and value questionnaires to each of these companies twice, but the questionnaires were returned with undeliverable addresses. Additionally, the Department sent these questionnaires to the Chamber of Commerce and Ministry of Commerce of the People's Republic of China, requesting them to forward these questionnaires to the companies, but the Department received no response. See Memorandum to the File from Christopher D. Riker, Program Manager, AD/CVD Operations Office 9, R.E.: 2004/2006 Administrative Review of Certain Frozen Warmwater Shrimp from the People's Republic of China, Subject: Inability to Contact Certain Companies Included in the Notice of Initiation. Therefore, the Department is rescinding the review with respect to these companies, in accordance with our practice. See Certain Steel Concrete Reinforcing Bars from Turkey: Preliminary results and Partial Rescission of Antidumping Duty Administrative Review, 71 FR 26455, 26457 (May 5, 2006).

Additionally, consistent with section 351.214(j) of the Department's regulations, the Department is rescinding the administrative review of Zhanjiang Regal because the Department has already reviewed all of the company's sales which were made during the POR in the context of a new shipper review. See Certain Frozen Warmwater Shrimp From the People's Republic of China: Final Results of the Antidumping Duty New Shipper Review, 71 FR 70362 (December 4, 2006). Furthermore, the Department is rescinding the administrative review of Shantou City Qiaofeng Group as this is the same company, but with a different name, as a company for which the administrative review has already been rescinded (i.e., Chaoyang Qiaofeng Group Co., Ltd.). See Memorandum to the File, through Christopher D. Riker, Program Manager, AD/CVD Enforcement, Office 9, from Michael Quigley, Case Analyst, AD/CVD Enforcement, Office 9, regarding 2004/2006 Administrative Review of Certain Frozen Warmwater Shrimp from the People's Republic of China: Shantou City Qiaofeng Group (August 16, 2006). The Department received no comments on these issues, and we did not receive any further information since the issuance of the Preliminary Results that provides a basis for reconsideration of these determinations.

Bona Fide Sale Analysis—Asian Seafoods & Hai Li

The Department also preliminarily rescinded the administrative review of Asian Seafoods and Hai Li due to the Department finding that the single sales made during the POR were not bona fide. The Department received comments from Asian Seafoods and the petitioner regarding the Department's preliminary bona fides determination with respect to Asian Seafoods, and for the reasons stated below, we continue to find that Asian Seafood's reported U.S. sale during the POR does not appear to be a bona fide sale, based on the totality of the facts on the record. See, e.g., Glycine From The People's Republic of China: Rescission of Antidumping Duty New Shipper Review of Hebei New Donghua Amino Acid Co., Ltd., 69 FR 47405, 47406 (August 5, 2004). Specifically, we find that: (1) The sales price of Asian Seafoods' single POR sale; (2) irregularities relating to its customer correspondence; (3) atypical terms for the POR sale, and finally; (4) other indicia of a non-bona fide transaction, all demonstrate that the single sale under review was not bona fide. Therefore, this sale does not provide a reasonable or reliable basis for calculating a dumping margin.

Additionally, the Department received comments from Hai Li and the petitioner regarding the Department's preliminary bona fides determination with regard to Hai Li, and for the reasons stated below, we continue to find that Hai Li's reported U.S. sale during the POR does not appear to be a bona fide sale, based on the totality of the facts on the record. See, e.g., Glycine From The People's Republic of China: Rescission of Antidumping Duty New Shipper Review of Hebei New Donghua Amino Acid Co., Ltd., 69 FR 47405, 47406 (August 5, 2004). Specifically, we continue to find that: (1) The difference in the sales price of Hai Li's single POR sale as compared to the average unit value of suspended entries derived from CBP data; (2) the involvement of unaffiliated parties in Hai Li's single POR sale; (3) irregularities relating to packing materials, and finally, (4) other indicia of a non-bona fide transaction, all demonstrate that the single sale under review was not bona fide. Therefore, this sale does not provide a reasonable or reliable basis for calculating a dumping margin.

For the reasons mentioned above, the Department finds that Asian Seafood's and Hai Li's single U.S. sales during the POR were not bona fide commercial transactions and is rescinding the administrative review of Asian Seafoods, and the new shipper review of Hai Li. For a more detailed analysis, see Memorandum to David Spooner, Assistant Secretary for Import Administration, from Gary Taverman, Acting Deputy Assistant Secretary for Import Administration, regarding Issues and Decision Memorandum for the Final Results of 2004/2006 Antidumping Duty Administrative and New Shipper Reviews of Certain Frozen Warmwater Shrimp from the People's Republic of China (September 5, 2007) (“Issues and Decision Memorandum”) at Comments 16 and 17.

Adverse Facts Available—Red Garden, Meizhou and Zhoushan Huading

For purposes of the Preliminary Results, the Department applied facts available to sales by Red Garden, Meizhou and Zhoushan Huading. No comments on this determination were submitted by any interested party. Therefore, for the reasons stated above, we find it appropriate, pursuant to sections 776(a)(2)(D) and 776(b) of the Tariff Act of 1930, as amended (“the Act”), to use adverse facts available (“AFA”) as the basis for the final results of review for Red Garden, Meizhou, and Zhoushan Huading, which are part of the PRC-wide entity, as the Department was unable to verify their questionnaire responses concerning their eligibility for a separate rate. Consistent with the statute, court precedent, and its normal practice, the Department has assigned the rate of 112.81 percent to the PRC-wide entity (including Red Garden, Meizhou, and Huading), the highest rate from the petition in the LTFV investigation. See Notice of Amended Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Certain Frozen Warmwater Shrimp From the People's Republic of China, 70 FR 5149 (February 1, 2005). As discussed further below, this rate has been corroborated.

Furthermore, because Huading terminated verification and we found reimbursement of antidumping duties, the Department assigned Huading a rate inclusive of the PRC-wide entity rate and the reimbursement adjustment, or 225.62 percent. No comments were received regarding this determination.

Corroboration of Secondary Information

Section 776(c) of the Act requires that the Department corroborate, to the extent practicable, a figure which it applies as facts available. To be considered corroborated, information must be found to be both reliable and relevant. We are applying as AFA the highest rate from any segment of this administrative proceeding, which is the rate currently applicable to all exporters subject to the PRC-wide rate. The AFA rate in the current review (i.e., the PRC-wide rate of 112.81 percent) represents the highest rate from the petition in the less than fair value (“LTFV”) investigation. See Notice of Amended Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Certain Frozen Warmwater Shrimp From the People's Republic of China, 70 FR 5149 (February 1, 2005).

For purposes of corroboration, the Department will consider whether that margin is both reliable and relevant. The AFA rate we are applying for the current review was corroborated in the LTFV investigation. See, e.g., Notice of Final Determination of Sales at Less Than Fair Value: Certain Frozen and Canned Warmwater Shrimp From the People's Republic of China, 69 FR 70997 (December 8, 2004). This is the first administrative review of this antidumping duty order. No information has been presented in the current review that calls into question the reliability of this information.

Analysis of Comments Received

In the case and rebuttal briefs received from the parties after the Preliminary Results, we received comments on several issues, including the surrogate values used to value raw shrimp, shrimp feed, overhead, selling, general and administrative expenses, and profit. All issues raised in the case briefs are addressed in the Issues and Decision Memorandum, which is hereby adopted by this notice. A list of the issues raised, all of which are in the Issues and Decision Memorandum, is attached to this notice as Appendix I. Parties can find a complete discussion of all issues raised in the briefs and the corresponding recommendations in this public memorandum on file in the Central Records Unit (“CRU”), room B-099 of the Herbert C. Hoover Building. In addition, a complete version of the Issues and Decision Memorandum can be accessed directly on the Web at http://ia.ita.doc.gov. The paper copy and electronic version of the Issues and Decision Memorandum are identical in content.

Changes Since the Preliminary Results

Based on the comments received from the interested parties, we have made changes to the margin calculation for Yelin.

Final Results of Review

We determine that the following antidumping duty margins exist:

For details on the calculation of the antidumping duty margin for Yelin, see Memorandum to the File, through Scot T. Fullerton, Program Manager, from Erin C. Begnal, Senior International Trade Analyst, regarding Certain Frozen Warmwater Shrimp from the People's Republic of China—Analysis Memorandum for the Final Results of Administrative Review of Yelin Enterprise Co. Hong Kong (September 5, 2007). A public version of this memorandum is on file in the Central Records Unit.

Assessment of Antidumping Duties

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 these final results of review. For assessment purposes for companies with a calculated rate, where possible, we calculated importer-specific assessment rates for certain frozen warmwater shrimp from the PRC via 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 during the POR. We will instruct CBP to assess antidumping duties on all appropriate entries covered by this review.

Cash Deposits

The following cash-deposit requirements will be effective upon publication of the final results for 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 the exporters listed above, the cash deposit rate will be equivalent to the company-specific weighted-average margin established in this review; (2) for PRC exporters who received a separate rate in a prior segment of the proceeding, but were not reviewed in this review, the cash deposit rate will continue to be the rate assigned in that segment of the proceeding; (3) for all other PRC exporters of subject merchandise which have not been found to be entitled to a separate rate (including Red Garden and Meizhou), the cash-deposit rate will be the PRC-wide rate of 112.81 percent; (4) for all non-PRC exporters of subject merchandise, the cash-deposit rate 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.

Notification to Importers

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 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.

These reviews and notice are in accordance with sections 751(a)(1), 751(a)(2) and 777(i)(1) of the Act and 19 CFR 351.221(b)(5).

Appendix I

General Issues

Comment 1: Shrimp Feed Valuation

Comment 2: Selection of Financial Statements

Comment 3: Adjustments to Surrogate Financial Ratios

A. Carriage and Freight

B. Labor-Related Expenses

Comment 4: Wage Rate

Comment 5: Refrigerated Truck Freight Valuation

Comment 6: Raw Shrimp Valuation

Comment 7: By-Product Surrogate Valuation

Comment 8: Clerical Error in Calculating the Raw Shrimp Surrogate Value

Company-Specific Issues

Comment 9: Yelin's Carton Consumption

Comment 10: Application of Partial Adverse Facts Available to Yelin

Comment 11: Ocean Duke's Reported Costs

A. Warehousing Expenses

B. Additional Ocean Duke Expenses

Comment 12: Multinational Corporation Provision

Comment 13: Valuation of Yelin's Purchased Raw Shrimp

Comment 14: Treatment of Guolian Aquatic Products

Comment 15: Treatment of Allied Pacific Group

Comment 16: The Bona Fides of Asian Seafoods' Single POR Sale

A. Price

B. Irregularities Regarding the Customer Correspondence Submitted in the Review

C. Atypical Terms of Sale

D. Other Indicia Of Non-Bona Fide Transaction

E. Calculation of Rate For Assessment Purposes

F. Assignment of the PRC-Wide Rate to Asian Seafoods

Comment 17: The Bona Fides of Hai Li's Single POR Sale

A. Price

B. Involvement of Third Parties in Hai Li's Sale

C. Irregularities Regarding Hai Li's Packaging Materials

D. Other Indicia of a Non-Bona Fide Transaction

E. Calculation of Rate For Assessment Purposes