2010-15639. Certain Frozen Warmwater Shrimp From the Socialist Republic of Vietnam: Rescission of New Shipper Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

The Department of Commerce (“Department”) is conducting a new shipper review of the antidumping duty order on certain frozen warmwater shrimp from the Socialist Republic of Vietnam (“Vietnam”) with respect to Nhat Duc Co., Ltd. (“Nhat Duc”) covering the period of review (“POR”) of February 1, 2008, through January 31, 2009. See Notice of Amended Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Certain Frozen Warmwater Shrimp From the Socialist Republic of Vietnam, 70 FR 5152 (February 1, 2005) (“Shrimp Order”). We announced our preliminary intent to rescind the new shipper review for Nhat Duc, finding that Nhat Duc's sole U.S. sale during the POR was non-bona fide, and, therefore, Nhat Duc had no reviewable sales during the POR. See Certain Frozen Warmwater Shrimp from the Socialist Republic of Vietnam: Preliminary Intent to Rescind New Shipper Review, 75 FR 3446 (January 21, 2010) (“Preliminary Rescission”). We have analyzed the comments received, and we have made no changes to the Preliminary Rescission.

DATES:

Effective Date: June 28, 2010.

FOR FURTHER INFORMATION CONTACT:

Toni Dach or Paul Walker, 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: [phone] or [phone], respectively.

SUPPLEMENTARY INFORMATION:

Case History

On January 21, 2010, the Department published in the Federal Register the Preliminary Rescission. On March 2, 2010, Nhat Duc filed comments regarding the Department's Preliminary Rescission. On March 8, 2010, the Ad Hoc Shrimp Trade Action Committee (“domestic producers”), filed comments regarding the Department's Preliminary Rescission. On April 20, 2010, the Department extended the time limit for the completion of the final results of this new shipper review by 30 days. See Certain Frozen Warmwater Shrimp from the Socialist Republic of Vietnam: Extension of Final Results of Antidumping Duty New Shipper Review, 75 FR 20563 (April 20, 2010). On May 18, 2010, the Department fully extended the time limit for the completion of the final results of this new shipper review by an additional 30 days. See Certain Frozen Warmwater Shrimp from the Socialist Republic of Vietnam: Extension of Final Results of Antidumping Duty New Shipper Review, 75 FR 27705 (May 18, 2010).

Scope of the Order

The scope of the 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,^[1] 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 the order, regardless of definitions in the Harmonized Tariff Schedule of the United States (“HTSUS”), 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, whiteleg 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 the order. 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 the order.

Excluded from the scope are: (1) Breaded shrimp and prawns (HTSUS 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 (HTSUS subheadings 0306.23.00.20 and 0306.23.00.40); (4) shrimp and prawns in prepared meals (HTSUS subheading 1605.20.05.10); (5) dried shrimp and prawns; (6) canned warmwater shrimp and prawns (HTSUS subheading 1605.20.10.40); (7) certain dusted shrimp; and (8) 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 the order are currently classified under the following HTSUS 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 HTSUS subheadings are provided for convenience and for customs purposes only and are not dispositive, but rather the written description of the scope of the order is dispositive.

Analysis of Comments Received

Issues raised in the comments by Nhat Duc and domestic producers are addressed in the concurrent Issues and Decision Memorandum (“Issues and Decision Memo”), which is hereby adopted by this notice.^[2] A list of the issues which Nhat Duc and domestic producers 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, 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.

Rescission of Review

In evaluating whether or not a sale is commercially reasonable, and therefore bona fide, the Department has considered, inter alia, such factors as (1) The timing of the sale; (2) the price and quantity; (3) the expenses arising from the transaction; (4) whether the goods were resold at a profit; and (5) whether the transaction was at arms-length. See e.g., Tianjin Tiancheng Pharmaceutical Co., Ltd. v. U.S., 366 F. Supp. 2d 1246, 1250 (CIT 2005) (“TTPC”), citing Am. Silicon Techs. v. U.S., 110 F. Supp. 2d 992, 995 (CIT 2000). However, the analysis is not limited to these factors alone. Id. The Department examines a number of factors, all of which may speak to the commercial realities surrounding the sale of subject merchandise. While some bona fide issues may share commonalities across various Department cases, each one is company-specific and may vary with the facts surrounding each sale. See Certain Preserved Mushrooms From the People's Republic of China: Final Results and Partial Rescission of the New Shipper Review and Final Results and Partial Rescission of the Third Antidumping Duty Administrative Review, 68 FR 41304 (July 11, 2003) and accompanying Issues and Decision Memorandum at Comment 2. The weight given to each factor considered will depend on the circumstances surrounding the sale. See TTPC at 1263.

As discussed in detail in the Issues and Decision Memo, the Department has determined that the sale made by Nhat Duc was not bona fide, as it is not typical of Nhat Duc's usual commercial practices or commercially reasonable. Further, the Department is unable to analyze whether the sale was conducted on an arm's-length basis. The Department reached this conclusion based on the totality of the circumstances, namely: (a) The atypical nature of Nhat Duc's POR pricing; (b) the timing and extent of payment receipt for Nhat Duc's single POR sale; (c) the existence of undisclosed sales subsequent to Nhat Duc's single POR sale; (d) the atypical nature of Nhat Duc's production timeline for its POR U.S. sale; (e) irregularities in Nhat Duc's sales negotiation correspondence and the unverifiable nature of this correspondence; and (f) the unverifiable nature of Nhat Duc's founding capital sources.

Nhat Duc only made a single, non-bona fide sale during the POR. Therefore, the Department is rescinding this review because there are no reviewable sales during the POR. See TTCP at 1249. Because the Department is rescinding the new shipper review, we are not making a determination as to whether Nhat Duc qualifies for a separate rate. Therefore, Nhat Duc will remain part of the Vietnam-wide entity.

Cash Deposit Rates

The following cash deposit requirements continue to apply for all shipments of subject merchandise from Nhat Duc entered, or withdrawn from warehouse: (1) For subject merchandise produced and exported by Nhat Duc, the cash deposit rate will continue to be the Vietnam-wide rate (i.e., 25.76 percent); (2) for subject merchandise exported by Nhat Duc but not manufactured by Nhat Duc, the cash deposit rate will continue to be the Vietnam-wide rate (i.e., 25.76 percent); and (3) for subject merchandise manufactured by Nhat Duc, but exported by any other party, the cash deposit rate will be the rate applicable to the exporter. These cash deposit requirements shall remain in effect until further notice.

Administrative Protective Orders

This notice also serves as a reminder to parties subject to administrative protective orders (“APO”) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305, which continues to govern business proprietary information in this segment of the proceeding. 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 terms of an APO is a violation which is subject to sanction.

We are issuing and publishing this determination in accordance with sections 751(a)(2)(B) and 777(i) of the Act, and 19 CFR 351.214(h) and 351.221(b)(5).

Dated: June 18, 2010.

Paul Piquado,

Acting Deputy Assistant Secretary for Import Administration.

Appendix

List of Comments and Issues in the Issues and Decision Memorandum

Comment: Bona Fide Nature of Nhat Duc's POR Sale.

Footnotes

1.  “Tails” in this context means the tail fan, which includes the telson and the uropods.

2.  In addition, due to the proprietary nature of much of the information involved in company specific discussions, the Department has addressed certain issues in a separate proprietary memorandum. See Antidumping Duty New Shipper Review of Certain Frozen Warmwater Shrimp from the Socialist Republic of Vietnam: Bona Fide Nature of the Sale Under Review for Nhat Duc Co., Ltd.: Price of the Sale and Subsequent U.S. Sales.