E9-18724. Certain Frozen Warmwater Shrimp From Thailand: Preliminary Results of Antidumping Duty Changed Circumstances Review and Notice of Intent to Revoke in Part

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

DATES:

Effective Date: August 5, 2009.

SUMMARY:

On March 24, 2009, the Department of Commerce (the Department) published a notice of initiation of a changed circumstances review of the antidumping duty order on frozen warmwater shrimp from Thailand to consider whether it is appropriate to revoke the order in part with respect to two companies, Phatthana Frozen Food Co., Ltd. (PFF) and Sea Wealth Frozen Food Co., Ltd. (Sea Wealth), pursuant to section 751(b)(1) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.216(b) and 351.222. See Certain Frozen Warmwater Shrimp from Thailand: Initiation of Antidumping Duty Changed Circumstances Review, 74 FR 12308 (Mar. 24, 2009) (Initiation Notice). Upon analyzing the information provided by the two companies, we preliminarily determine that PFF and Sea Wealth should be revoked from the antidumping duty order on certain frozen warmwater shrimp from Thailand.

FOR FURTHER INFORMATION CONTACT:

Henry Almond; AD/CVD Operations, Office 2, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230; telephone: [phone].

SUPPLEMENTARY INFORMATION:

Background

On February 1, 2005, the Department published in the Federal Register an antidumping duty order on certain frozen warmwater shrimp from Thailand. See Notice of Amended Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Certain Frozen Warmwater Shrimp From Thailand, 70 FR 5145 (Feb. 1, 2005) (Thai Shrimp Order).

Subsequent to the issuance of this order, the Thai Government challenged the Department's practice of offsetting dumped sales with non-dumped sales in the LTFV investigation of certain frozen warmwater shrimp from Thailand before the World Trade Organization. In November 2008, the Department initiated a Section 129 proceeding to reconsider this practice with respect to Thai shrimp, and in January 2009 it issued a final determination in that proceeding which resulted in the revocation of the order related to shrimp produced and exported by two entities—Thai I-Mei and the Rubicon Group. See Implementation of the Findings of the WTO Panel in United States—Antidumping Measure on Shrimp From Thailand: Notice of Determination Under Section 129 of the Uruguay Round Agreements Act and Partial Revocation of the Antidumping Duty Order on Frozen Warmwater Shrimp From Thailand, 74 FR 5638, 5638 (Jan. 30, 2009) (Section 129 Implementation). For purposes of this determination the Department defined the Rubicon Group as consisting of the following nine companies, which were the group members existing at the time of the LTFV investigation: Andaman Seafood Co., Ltd., Chanthaburi Frozen Food Co., Ltd., Chanthaburi Seafoods Co., Ltd., Intersia Foods Co., Ltd., Phatthana Seafood Co., Ltd., S.C.C. Frozen Seafood Co., Ltd., Thailand Fishery Cold Storage Public Co., Ltd., Thai International Seafoods Co., Ltd., and Wales & Co. Universe Limited. See Section 129 Implementation, 74 FR at 5639.

On February 5, 2009, the Rubicon Group requested that the Department conduct an expedited changed circumstances review under 19 CFR 351.221(c)(3)(iii) to consider also revoking PFF and Sea Wealth from the Thai Shrimp Order. According to the Rubicon Group, although these two companies were not included in the Department's margin calculations in the LTFV investigation, the Department has treated them as part of the Rubicon Group in subsequent segments of this proceeding. In this request, the Rubicon Group also asked that any revocation for PFF and Sea Wealth be made effective January 16, 2009, the effective date of the Section 129 Implementation.

On February 12, 2009, we requested that the Rubicon Group clarify its changed circumstances review request to identify the relevant statutory provision under which its request fell. On February 13, 2009, the Rubicon Group clarified its changed circumstances review request, stating that it would be appropriate for the Department to evaluate its request using either a “collapsing” analysis under 19 CFR 351.401(a) or the Department's “successor-in-interest” analysis, pursuant to section 751(b)(1) of the Act and 19 CFR 351.216(b).

On February 18, 2009, we requested further information from the Rubicon Group with respect to the four factors examined by the Department in a successor-in-interest determination: Management; production facilities; supplier relationships; and customer base. On March 13, 2009, the Rubicon Group submitted the requested information.

On April 29, 2009, we placed documents from the LTFV investigation relating to the corporate structure of the Rubicon Group as it existed during the LTFV investigation on the record of this changed circumstances review. On that date, we also requested additional information from the Rubicon Group. On May 27, 2009, the Rubicon Group submitted the requested information.

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,^[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 this 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 this 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 this 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 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 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 this order is dispositive.

Preliminary Results of Changed Circumstances Review

Pursuant to section 751(b)(1) of the Act and 19 CFR 351.216, the Department will conduct a changed circumstances review upon receipt of information concerning, or request from an interested party for review of, an antidumping duty order which shows changed circumstances sufficient to warrant review of the order. In this case, the Department found that the information submitted by the Rubicon Group provided evidence of changed circumstances sufficient to warrant a review. See Initiation Notice, 74 FR at 12309. Thus, in accordance with section 751(b) of the Act, the Department initiated a changed circumstances review to determine whether the current Rubicon Group is the successor-in-interest to the Rubicon Group as it existed at the time of the LTFV investigation. Id. In making a successor-in-interest determination, the Department examines several factors including, but not limited to, changes in the following: (1) Management; (2) production facilities; (3) supplier relationships; (4) customer base. See Brake Rotors From the People's Republic of China: Final Results of Changed Circumstances Antidumping Duty Administrative Review, 70 FR 69941 (Nov. 18, 2005); and Notice of Final Results of Changed-Circumstances Antidumping Duty Administrative Review: Polychloroprene Rubber From Japan, 67 FR 58 (Jan. 2, 2002). While no single factor or combination of factors will necessarily provide a dispositive indication of a successor-in-interest relationship, the Department will generally consider the new company to be the successor to the previous company if the new company's resulting operation is not materially dissimilar to that of its predecessor. See Fresh and Chilled Atlantic Salmon From Norway: Final Results of Changed Circumstances Antidumping Duty Administrative Review, 64 FR 9979 (Mar. 1, 1999); and Industrial Phosphoric Acid From Israel: Final Results of Antidumping Duty Changed Circumstances Review, 59 FR 6944 (Feb. 4, 1994). Thus, if the evidence demonstrates that, with respect to the production and sale of subject merchandise, the new company operates as the same business entity as the former company, the Department will accord the new company the same antidumping treatment as its predecessor.

The Rubicon Group has submitted information demonstrating that PFF and Sea Wealth are fully integrated into the Rubicon Group by virtue of being owned and controlled by other Rubicon Group companies and that the two companies are strategically engaged with the other Rubicon Group companies in the production and sale of subject merchandise to the United States. See the July 29, 2009, memorandum from Henry Almond, Analyst, to James Maeder, Director, entitled, “Successor-In-Interest Determination for the Rubicon Group in the Changed Circumstances Review of Certain Frozen Warmwater Shrimp from Thailand” at pages 3-6 (Successor Memo). Further, the addition of PFF and Sea Wealth to the Rubicon Group has not altered the Rubicon Group's production capacity or significantly changed the Rubicon Group's production facilities. See the Successor Memo at page 5. Finally, the Rubicon Group continues to source its shrimp from the same suppliers and sell its shrimp to the same and similar customers as it did during the POI. See the Successor Memo at pages 5-6.

Based on the information submitted by the Rubicon Group, we preliminary find that there have been no significant changes in any of the four factors outlined above since the POI. Regarding its management structure, the Rubicon Group has submitted information demonstrating that PFF and Sea Wealth are fully integrated into the Rubicon Group by virtue of being owned and controlled by other Rubicon Group companies and that the two companies are involved with the other Rubicon Group companies in the production and sale of subject merchandise to the United States. Because the Rubicon Group has demonstrated that there has been no change in the management of the Rubicon Group as a result of the addition of PFF and Sea Wealth, we preliminarily find there has been no significant change in the management of the Rubicon Group since the POI. Regarding the Rubicon Group's production capacity and facilities, although the Rubicon Group has closed one production facility and opened one new facility since the POI, the group's overall production capacity and production and packaging processes have not changed since the POI. Thus, based upon the information submitted by the Rubicon Group, we preliminarily find that there has been no significant change in the Rubicion Group's production facilities since the POI. Regarding the Rubicon Group's supplier relationships, the Rubicon Group has submitted information demonstrating that its suppliers and supplier relationships have not changed since the POI. Accordingly, we preliminarily find that there has been no significant change in the Rubicon Group's suppliers or supplier relationships since the POI. Regarding the Rubicon Group's customer base, the Rubicon Group submitted POI and current customer lists which demonstrate that there has been no significant change in its customers since the POI. Based upon this information, we preliminarily find that there has been no significant change in the Rubicon Group's customer base since the POI. For further discussion of the four factors, see the Successor Memo at pages 3-6.

Accordingly, we preliminarily determine that the Rubicon Group in its current form, including PFF and Sea Wealth, is the successor-in-interest to the Rubicon Group as it existed during the POI of the LTFV investigation. Thus, if these preliminary results are adopted in our final results of this changed circumstances review, we will consider PFF and Sea Wealth to be part of the Rubicon Group and, therefore, revoke them from the Thai Shrimp Order.

This finding is consistent with our treatment of these companies as a single entity in the 06-07 Final Results, the most recently completed administrative review. See Certain Frozen Warmwater Shrimp From Thailand: Final Results and Final Partial Rescission of Antidumping Duty Administrative Review, 73 FR 50933, 50937 (Aug. 29, 2008).

Finally, in its changed circumstances review request the Rubicon Group requested that any resulting revocation for PFF and Sea Wealth be effective as of January 16, 2009 (the effective date of the Section 129 Implementation). Consistent with our treatment of companies excluded from antidumping duty orders which are subject to subsequent successor-in-interest determinations, we will apply this successor-in-interest determination retroactively to the dates PFF and Sea Wealth were formed and became part of the Rubicon Group (i.e., August 31, 2005, for PFF and July 24, 2003, for Sea Wealth). See, e.g., Stainless Steel Wire Rod From Italy: Notice of Final Results of Changed Circumstances Antidumping Duty Review, 71 FR 24643, 24644 (Apr. 26, 2006). Because these dates are prior to January 16, 2009, we find that it is appropriate to revoke the antidumping duty order with respect to frozen warmwater shrimp produced and exported by PFF and Sea Wealth as of January 16, 2009, consistent with our treatment of the other members of the Rubicon Group.^[2]  See Section 129 Implementation, 74 FR at 5639.

Public Comment

Parties wishing to comment on these results must submit briefs to the Department within 30 days after the publication of this notice in the Federal Register. Parties will have five days subsequent to this due date to submit rebuttal briefs. Parties who submit comments or rebuttal briefs in this proceeding are requested to submit with the argument: (1) A statement of the issue, and (2) a brief summary of the argument (no longer than five pages, including footnotes). Any requests for hearing must be filed within 30 days of the publication of this notice in the Federal Register. In accordance with 19 CFR 351.216(e), the Department will issue its final results of review within 270 days after the date on which the changed circumstances review was initiated (i.e., no later than December 21, 2009).

We are issuing and publishing this notice in accordance with sections 751(b)(1) and 777(i)(1) of the Act and 19 CFR 351.216.

Dated: July 29, 2009.

Ronald K. Lorentzen,

Acting Assistant Secretary for Import Administration.

Footnotes

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

2.  We note that this revocation will apply to merchandise produced by any Rubicon Group member and exported by PFF or Sea Wealth, as well as to merchandise produced by PFF or Sea Wealth and exported by any other Rubicon Group member.