02-26311. Freshwater Crawfish Tail Meat from the People's Republic of China: Notice of Preliminary Results of Antidumping Duty Administrative Review

AGENCY:

Import Administration, International Trade Administration, Department of Commerce.

SUMMARY:

The Department of Commerce (the Department) is conducting an administrative review of the antidumping duty order on freshwater crawfish tail meat from the People's Republic of China (PRC) in response to requests from the Crawfish Processors Alliance (petitioner) and the Louisiana Department of Agriculture & Forestry and Bob Odom, Commissioner; and from respondents China Kingdom Import & Export Co., Ltd., aka China Kingdoma Import & Export Co., Ltd., aka Zhongda Import & Export Co., Ltd. (China Kingdom) and Qingdao Zhengri Seafood Company, Ltd., aka Qingdao Zhengri Seafoods (Qingdao Zhengri). The period of review (POR) is from September 1, 2000, through August 31, 2001.

We preliminarily determine that sales have been made below normal value (NV). The preliminary results are listed below in the section titled “Preliminary Results of Review.” If these preliminary results are adopted in our final results, we will instruct the U.S. Customs Service to assess antidumping duties based on the difference between the export price (EP) or constructed export price (CEP), as applicable, and NV. Interested parties are invited to comment on these preliminary results. See the “Preliminary Results of Review” section of this notice.

EFFECTIVE DATE:

October 16, 2002.

FOR FURTHER INFORMATION CONTACT:

Doug Campau or Maureen Flannery, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, N.W., Washington, D.C. 20230; telephone: [phone] or [phone], respectively.

SUPPLEMENTARY INFORMATION:

The Applicable Statute

Unless otherwise indicated, all citations to the statute are references to the provisions of the Tariff Act of 1930, as amended (the Act). In addition, unless otherwise indicated, all citations to the Department's regulations are to the provisions codified at 19 CFR part 351 (2001).

Background

The Department published in the Federal Register an antidumping duty order on freshwater crawfish tail meat from the PRC on September 15, 1997. See Notice of Amendment to Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Freshwater Crawfish Tail Meat from the People's Republic of China, 62 FR 48218 (September 15, 1997). On September 28, 2001, in accordance with 19 CFR 351.213(b)(1), the Department received a request from the petitioner to conduct an administrative review of several companies, covering the period from September 1, 2000, through August 31, 2001. On September 28, 2001, respondents China Kingdom and Qingdao Zhengri also requested review of their own shipments. The Department initiated an antidumping duty administrative review for this case on October 23, 2001. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Requests for Revocation in Part, 65 FR 54195 (October 26, 2001).

On May 20, 2002, the Department determined that it was not practicable to complete the preliminary results of this review within the statutory time limit. Consequently, in accordance with section 751(a)(3)(A) of the Act and section 351.213(h)(1) of the Department's regulations, the Department extended the deadline for completion of the preliminary results of the administrative review by 120 days, to September 30, 2002. See Notice of Extension of Time Limit of Preliminary Results of Antidumping Duty Administrative Review: Freshwater Crawfish Tail Meat from the People's Republic of China, 67 FR 36856 (May 28, 2002).

On July 31, 2002, in accordance with sections 351.213(d)(1) and (3) of its regulations, the Department rescinded, in part, this administrative review of the antidumping duty order on freshwater crawfish tail meat. See Freshwater Crawfish Tail Meat from the People's Republic of China: Notice of Rescission, in Part, of Antidumping Duty Administrative Review for the Period September 1, 2000, through August 31, 2001, 67 FR 50860 (August 6, 2002). The Department rescinded the review only with respect to those companies which had no reportable U.S. entries or exports of subject merchandise during the period of review, or for which all applicable requests for review were withdrawn in a timely manner.

Following the rescission, this review now covers the following companies: China Kingdom; Fujian Pelagic Fishery Group Co. (Fujian Pelagic); Qingdao Rirong Foodstuff Co., Ltd., aka Qingdao Rirong Foodstuffs (Qingdao Rirong); Qingdao Zhengri/Yancheng Yaou Seafoods (Qingdao Zhengri/Yancheng Yaou); Shantou SEZ Yangfeng Marine Products Co. (Shantou SEZ); Suqian Foreign Trade Corp., aka Suqian Foreign Trading (Suqian Foreign Trade); Yancheng Foreign Trade Corp., aka Yancheng Foreign Trading, aka Yang Cheng Foreign Trading (Yancheng Foreign Trade); and Yangzhou Lakebest Foods Co., Ltd. (Yangzhou Lakebest).

Scope of the Antidumping Duty Order

The product covered by this antidumping duty order is freshwater crawfish tail meat, in all its forms (whether washed or with fat on, whether purged or unpurged), grades, and sizes; whether frozen, fresh, or chilled; and regardless of how it is packed, preserved, or prepared. Excluded from the scope of the order are live crawfish and other whole crawfish, whether boiled, frozen, fresh, or chilled. Also excluded are saltwater crawfish of any type, and parts thereof. Freshwater crawfish tail meat is currently classifiable in the Harmonized Tariff Schedule of the United States (HTS) under item numbers 1605.40.10.10 and 1605.40.10.90, which are the new HTS numbers for prepared foodstuffs, indicating peeled crawfish tail meat and other, as introduced by the U.S. Customs Service in 2000, and HTS numbers 0306.19.00.10 and 0306.29.00.00, which are reserved for fish and crustaceans in general. The HTS subheadings are provided for convenience and Customs purposes only. The written description of the scope of this order is dispositive.

Treatment of Qingdao Zhengri and Yancheng Yaou

We determine that Qingdao Zhengri and Yancheng Yaou should be treated as a single entity for purposes of this administrative review. In their responses to the Department's questionnaires, both companies stated that they are related through a Hong Kong company that owns significant shares in both companies. In addition, the companies reported that the Hong Kong owner consolidated Qingdao Zhengri's selling activities with those of Yancheng Yaou in January 2000. See Response of Yancheng Yaou Seafoods to Section A of the Department's Questionnaire; 2000-2001 Review (March 11, 2002) at page 1; and Response of Qingdao Zhengri Seafood Co., Ltd. to Section A of the Department's Questionnaire; Crawfish Tail Meat 2000-2001 Review Investigation (March 11, 2002) at page 1. Qingdao Zhengri/Yancheng Yaou submitted three consolidated supplemental responses to sections A, C, and D of the Department's questionnaire. For the reasons cited above, the Department is treating these two companies as a single entity for these preliminary results.

Application of Facts Available

1. Fujian Pelagic, Shantou SEZ, Suqian Foreign Trade, Yancheng Foreign Trade, and Yangzhou Lakebest

As further discussed below, pursuant to sections 776(a)(2)(A) and (B) and section 776(b) of the Act, the Department determines that the application of total adverse facts available is warranted for respondents Fujian Pelagic, Shantou SEZ, Suqian Foreign Trade, Yancheng Foreign Trade, and Yangzhou Lakebest. All five of these respondents failed to respond to some or all of the Department's questionnaires for this POR. Yangzhou Lakebest and Suqian Foreign Trade responded to the Department's initial questionnaire, but then failed to respond to the Department's supplemental questionnaires. Fujian Pelagic, Shantou SEZ, and Yancheng Foreign Trade failed to respond to any of the Department's questionnaires. Sections 776(a)(2)(A) and 776(a)(2)(B) of the Act provide for the use of facts available when an interested party withholds information that has been requested by the Department, or when an interested party fails to provide the information requested in a timely manner and in the form required. These five respondents failed to provide information explicitly requested by the Department; therefore, we must resort to the facts otherwise available. Because these respondents did not respond to the Department's questionnaires, sections 782(d) and (e) of the Act are not applicable. In addition, section 782(c)(1) does not apply because these parties did not indicate that they were unable to submit the information required by the Department.

Section 776(b) of the Act provides that, in selecting from among the facts available, the Department may use an inference that is adverse to the interests of the respondent, if it determines that a party has failed to cooperate to the best of its ability. In applying the facts otherwise available, the Department has determined that an adverse inference is warranted pursuant to section 776(b) of the Act because the Department has determined that these respondents failed to cooperate to the best of their ability.

The Department finds that, by not providing the necessary responses to the questionnaires issued by the Department, these five companies have failed to cooperate to the best of their ability. None of these companies cited any reason for their failure to respond. Without this information, the Department cannot calculate margins for these companies nor determine that any merits a separate rate. This information was in the sole possession of the respondents, and could not be obtained otherwise. Thus, the Department is precluded from calculating margins for these companies or determining eligibility for separate rates. Therefore, in selecting from the facts available, the Department determines that an adverse inference is warranted. In accordance with sections 776(a)(2)(A) and (B), as well as section 776(b) of the Act, we are applying total adverse facts available to Fujian Pelagic, Shantou SEZ, Suqian Foreign Trade, Yancheng Foreign Trade, Yangzhou Lakebest and all other PRC exporters that have not established that they are entitled to a separate rate. As adverse facts available, the Department is assigning these companies the rate of 223.01 percent the highest rate determined in any previous segment of this proceeding. See Freshwater Crawfish Tail Meat from the People's Republic of China; Notice of Final Results of Antidumping Duty Administrative Review, and Final Partial Rescission of Antidumping Duty Administrative Review, 67 FR 19546 (April 22, 2002). As discussed below, this rate has been corroborated.

2. China Kingdom

Pursuant to sections 776(a)(2)(A) and (B) and section 776(b) of the Act, the Department determines that the application of adverse facts available is also warranted for respondent China Kingdom. At verification, China Kingdom explained that the total production and factors of production reported in its answers to the Department's questionnaires were based on production outside the POR. China Kingdom then attempted to submit new factual information, consisting of new figures for total production and factors of production. See Memorandum to the File: Antidumping Duty Administrative Review of Freshwater Crawfish Tail Meat from the People's Republic of China: Verification Report for China Kingdom Import & Export Co., Ltd. (September 16, 2002) (China Kingdom Verification Report). Sections 776(a)(2)(A) and 776(a)(2)(B) of the Act provide for the use of facts available when an interested party withholds information that has been requested by the Department, or when an interested party fails to provide the information requested in a timely manner and in the form required. China Kingdom failed to provide total production and factors of production for the relevant POR in a timely manner.

Section 782(c)(1) of the Act provides that if an interested party “promptly after receiving a request from {the Department} for information, notifies {the Department} that such party is unable to submit the information requested in the requested form and manner,” the Department may modify the requirements to avoid imposing an unreasonable burden on that party. Throughout the course of this review, China Kingdom had several opportunities to correct the reported data. However, at no time prior to the verification did China Kingdom notify the Department that it had any difficulty in obtaining the production or factors of production data from the relevant POR. At no point during the review did China Kingdom seek guidance on alternative reporting requirements, or propose an alternate form for submitting the required data, as contemplated in section 782(c)(1) of the Act.

Section 782(d) of the Act provides that if the Department determines that a response to a request for information does not comply with the request, the Department will inform the person submitting the response of the nature of the deficiency and shall, to the extent practicable, provide that person the opportunity to remedy or explain the deficiency. If that person submits further information that continues to be unsatisfactory, or this information is not submitted within the applicable time limits, the Department may, subject to section 782(e), disregard all or part of the original and subsequent responses, as appropriate. In its questionnaire, the Department asked China Kingdom to provide production and factors of production data for the POR (September 1, 2000, to August 31, 2001). Prior to the verification, the Department had no means of determining whether the data came from the relevant POR, and therefore could not inform the respondent that its response was deficient. On the other hand, China Kingdom had access to the necessary information, and was fully aware of the time period covered by the current review. In addition, China Kingdom had ample opportunities to correct its data prior to verification, but did not attempt to do so until verification had started.

Section 782(e) of the Act states that the Department shall not decline to consider information deemed “deficient” under section 782(d) if: (1) the information is submitted by the established deadline; (2) the information can be verified; (3) the information is not so incomplete that it cannot serve as a reliable basis for reaching the applicable determination; (4) the interested party has demonstrated that it acted to the best of its ability; and (5) the information can be used without undue difficulties. As discussed above, China Kingdom had ample time to submit the production and factors of production data for the relevant POR, but failed to do so. In addition, the Department had provided China Kingdom with the exact dates for verification well in advance. However, China Kingdom waited until verification to submit the production data for the relevant POR. Thus, the data reported in the questionnaire response could not be verified. As set forth in section 351.307(d) of the Department's regulations, the purpose of verification is to verify the accuracy and completeness of the information in the questionnaire responses. China Kingdom did not act to the best of its ability to comply with the Department's request for information. The production and factors of production data for the relevant POR is critical to the calculation of a dumping margin. China Kingdom failed to provide this information in its February 27, 2002, responses to the Department's section A through D questionnaire. In addition, between February 27, 2002, and August 8, 2002, China Kingdom failed to note that the data it had provided was completely irrelevant to this administrative review, and failed to request an opportunity to submit corrected data. At no time did the respondent indicate that it had trouble obtaining or submitting the data for the relevant POR. Consequently, China Kingdom has not demonstrated that it acted to the best of its ability in providing the information requested by the Department. In addition, the information was so incomplete that it could not be used in the determination. The submitted questionnaire response for production and factors of production was unverifiable. See Verification Report at 10. For these reasons, the information could not be used without undue difficulty.

Section 776(b) of the Act provides that, in selecting from among the facts available, the Department may use an inference that is adverse to the interests of the respondent, if it determines that a party has failed to cooperate to the best of its ability. In applying the facts otherwise available, the Department finds that an adverse inference is warranted, pursuant to

section 776(b) of the Act, because, as discussed above, the Department has determined that China Kingdom has failed to cooperate to the best of its ability. As adverse facts available, the Department is assigning China Kingdom the rate of 223.01 percent the highest rate determined in any previous segment of this proceeding. See Memorandum to Joseph A. Spetrini: Freshwater Crawfish Tail Meat from the People's Republic of China (PRC): Application of Total Adverse Facts Available for China Kingdom Import & Export Co., Ltd. in the Preliminary Results of the Administrative Review for the Period 9/1/00 - 8/31/01 (September 30, 2002) (China Kingdom AFA Memo). As discussed further below, this rate has been corroborated.

3. Qingdao Zhengri/Yancheng Yaou

Pursuant to sections 776(a)(2)(A) and (B) and section 776(b) of the Act, the Department determines that the application of adverse facts available is also warranted for respondents Qingdao Zhengri and Yancheng Yaou. As noted above, we have determined that Qingdao Zhengri and Yancheng Yaou should be treated as a single entity. On June 4, 2002, Qingdao Zhengri/Yancheng Yaou informed us that Qingdao Zhengri “does not wish to participate in a verification.” See Letter from Qingdao Zhengri, at 1 (June 4, 2002). This decision prevented the verification of information placed on the record. Section 776(a)(2)(D) warrants the use of facts otherwise available in reaching a determination when information is provided, but cannot be verified. Furthermore, on July 23, 2002, Qingdao Zhengri/Yancheng Yaou stated that Qingdao Zhengri “did not make any sales during the period of review prior to January 3, 2000.” See Letter from Qingdao Zhengri, at 1 (June 23, 2002). This statement contradicted earlier responses where Qingdao Zhengri/Yancheng Yaou stated that Qingdao Zhengri did not have any sales during the POR. In addition, several submissions made by Qingdao Zhengri/Yancheng Yaou did not contain accurate certifications, as required by section 351.303(g) of the Department's regulations. Sections 776(a)(2)(A) and 776(a)(2)(B) of the Act provide for the use of facts otherwise available when an interested party withholds information that has been requested by the Department, or when an interested party fails to provide the information requested in a timely manner and in the form required.

Since Qingdao Zhengri/Yancheng Yaou did not allow on-site verification of its responses at Qingdao Zhengri, none of the information submitted regarding Qingdao Zhengri could be verified, including its separate rate information. Furthermore, as discussed above, Qingdao Zhengri/Yancheng Yaou made contradictory statements regarding sales to the United States, and did not provide accurate certifications of its submissions by the deadline established by the Department. Thus, information submitted by Qingdao Zhengri/Yancheng Yaou cannot serve as a reliable basis for reaching a determination.

Section 776(b) of the Act provides that, in selecting from among the facts available, the Department may use an inference that is adverse to the interests of a respondent, if it determines that a party has failed to cooperate to the best of its ability. In applying the facts otherwise available, the Department finds that an adverse inference is warranted, pursuant to section 776(b) of the Act, because, as discussed above, the Department has determined that Qingdao Zhengri/Yancheng Yaou has failed to cooperate to the best of its ability by refusing verification of Qingdao Zhengri. Furthermore, Qingdao Zhengri/Yancheng Yaou have submitted contradictory responses regarding whether Qingdao Zhengri had any sales of crawfish tail meat during the POR. In addition, Qingdao Zhengri/Yancheng Yaou's responses were accompanied by certifications that did not comply with the requirements of section 351.303(g) of the Department's regulations. In light of these developments, we conclude that Qingdao Zhengri/Yancheng Yaou did not act to the best of its ability in this review. As adverse facts available, the Department is assigning this entity, and all other PRC exporters subject to the PRC-wide rate, the rate of 223.01 percent the highest rate determined in any previous segment of this proceeding. See Memorandum to Joseph A. Spetrini: Freshwater Crawfish Tail Meat from the People's Republic of China (PRC): Application of Total Adverse Facts Available for Qingdao Zhengri Seafood Co., Ltd. and Yancheng Yaou Seafood Co., Ltd. in the Preliminary Results of the Administrative Review for the Period September 1, 2000 through August 31, 2001 (September 30, 2002). As discussed further below, this rate has been corroborated.

4. Qingdao Rirong

At verification, Qingdao Rirong explained that the total production and factors of production (FOP) reported in its responses to the Department's questionnaires were incomplete because it omitted two months of production and consumption data for each factor. Qingdao Rirong then attempted to submit this new factual information, consisting of two months of previously unreported production and consumption data, as “minor corrections” to the questionnaire response. The Department declined to accept this new factual information as “minor corrections.” See Memorandum to Joseph A. Spetrini: Freshwater Crawfish Tail Meat from the People's Republic of China (PRC): Application of Partial Facts Available for Factors of Production: Qingdao Rirong Foodstuff Co., Ltd. Preliminary Results of the Administrative Review (September 1, 2000, through August 31, 2001) (September 30, 2002); see also, Antidumping Administrative Review of Freshwater Crawfish Tail Meat from the People's Republic of China (PRC) (A-570-848): Sales and Factors Verification Report for Qingdao Rirong Foodstuff Co., Ltd. (Qingdao Rirong) (September 16, 2002) (Qingdao Rirong Verification Report), on file in the Central Records Unit (CRU), Room B-099 of the main Department building.

Sections 776(a)(2)(A) and 776(a)(2)(B) of the Act provide for the use of facts available when an interested party withholds information that has been requested by the Department, or when an interested party fails to provide the information requested in a timely manner and in the form required. Qingdao Rirong failed to provide accurate and complete factor values for the POR in a timely manner.

Section 782(c)(1) of the Act provides that if an interested party “promptly after receiving a request from {the Department} for information, notifies {the Department} that such party is unable to submit the information requested in the requested form and manner,” the Department may modify the requirements to avoid imposing an unreasonable burden on that party. Throughout the course of this review, Qingdao Rirong had several opportunities to correct the reported data. However, at no time, prior to the verification, did Qingdao Rirong notify the Department that it had any difficulty in obtaining accurate and complete FOP for the relevant POR. At no point during the review did Qingdao Rirong seek guidance on alternative reporting requirements, or propose an alternate form for submitting the required data, as contemplated in section 782(c)(1) of the Act.

Section 782(d) of the Act provides that, if the Department determines that a response to a request for information does not comply with the request, the Department will inform the person submitting the response of the nature of the deficiency and shall, to the extent practicable, provide that person the opportunity to remedy or explain the deficiency. If that person submits further information that continues to be unsatisfactory, or this information is not submitted within the applicable time limits, the Department may, subject to section 782(e), disregard all or part of the original and subsequent responses, as appropriate. In its questionnaire, the Department asked Qingdao Rirong to provide production and FOP data for the POR (September 1, 2000, to August 31, 2001). Prior to the verification, the Department had no means of determining whether the data submitted were based on the entire POR, and therefore could not inform the respondent that its response was deficient. On the other hand, Qingdao Rirong had access to the necessary information and was fully aware of the time period covered by the current review. In addition, Qingdao Rirong had ample opportunities to correct its production and FOP data prior to verification, but did not do so until verification had started, although it was aware that the Department would no longer accept new factual information at that point.

Section 782(e) of the Act states that the Department shall not decline to consider information deemed “deficient” under section 782(d) if: (1) the information is submitted by the established deadline; (2) the information can be verified; (3) the information is not so incomplete that it cannot serve as a reliable basis for reaching the applicable determination; (4) the interested party has demonstrated that it acted to the best of its ability; and (5) the information can be used without undue difficulties. From the time it received the original questionnaire until verification, Qingdao Rirong had ample time to submit accurate and complete production and FOP for the relevant POR. In addition, the Department had provided Qingdao Rirong with the exact dates for verification well in advance, and had made it clear that all factual information should be submitted prior to the start of verification. However, Qingdao Rirong waited until verification to submit revised FOP based on revised production and consumption data.

Qingdao Rirong did not act to the best of its ability to comply with the Department's request for information. Qingdao Rirong should have been able to comply with the Department's requests for information in a timely manner. Qingdao Rirong's failure to provide essential information, namely, timely and complete production and FOP data, hindered the Department's ability to accurately calculate a dumping margin for this company. Qingdao Rirong failed to provide this information in its March 27, 2002, responses to the Department's section A through D questionnaire. In addition, between March 27, 2002, and July 29, 2002, Qingdao Rirong failed to detect that it had reported production volume and FOP that were incomplete and did not reflect the complete POR. At no time did Qingdao Rirong indicate that it had trouble obtaining or submitting the production and FOP data for all the months of the POR during which it produced subject merchandise. Consequently, Qingdao Rirong has not demonstrated that it acted to the best of its ability in providing the information requested by the Department.

Section 776(b) of the Act provides that, in selecting from among the facts available, the Department may use an inference that is adverse to the interests of the respondent, if it determines that a party has failed to cooperate to the best of its ability. In applying the facts otherwise available, the Department finds that an adverse inference is warranted, pursuant to section 776(b) of the Act, because the Department has determined that Qingdao Rirong has failed to cooperate to the best of its ability. Qingdao Rirong did not report significant data regarding production and FOP during two months of the POR. In turn, the new data affected the calculation of the factors of production for the entire POR. Furthermore, the Department issued, in all, four requests for information to Qingdao Rirong, which required Qingdao Rirong to examine its information submitted to the Department. Nevertheless, on none of these four occasions did Qingdao Rirong ever revise its FOP, nor did it indicate that it had not included certain production and consumption data in its FOP calculations. See Qingdao Rirong Verification Report. We therefore determine that Qingdao Rirong did not cooperate to the best of its ability within the meaning of 776(b) of the Act, and the application of adverse facts available is warranted.

Although the failure to report FOP based on complete production and consumption data for the POR warrants the application of adverse facts available, we do not find that the application of total adverse facts available is warranted since Qingdao Rirong responded to the Department's questionnaires; Qingdao Rirong allowed for verification; and the reported sales information and the production and consumption information submitted to the Department in the original questionnaire responses could be verified and was confirmed to be accurate. See Qingdao Rirong Verification Report. As such, the Department has determined that partial adverse facts available should be applied to account for the unreported months of production and consumption.

As partial adverse facts available for the two months of the production season (September and October 2000) for which the Department rejected the production and consumption and FOP data at verification as untimely filed new factual information, we have applied the highest monthly factor value of one of the remaining months of production, except for the crawfish scrap factor, for which we will take the lowest, as provided to and verified by the Department. To calculate each factor for the POR, we weighted each factor for September and October using the highest production quantity for any of the five reported months, and then weighted the factors for the reported months using the verified production quantity from each of those months. See Memorandum to File through Maureen Flannery from Elfi Blum: Analysis for the Preliminary Results of the Administrative Review of Freshwater Crawfish Tail Meat from the People's Republic of China: Qingdao Rirong Foodstuff Co., Ltd., dated September 30, 2002 (Calculation Memo); see also, Memorandum to Joseph A. Spetrini: Freshwater Crawfish Tail Meat from the People's Republic of China (PRC): Application of Partial Facts Available for Factors of Production: Qingdao Rirong Foodstuff Co., Ltd. Preliminary Results of the Administrative Review (September 1, 2000 through August 31, 2001) (September 30, 2002) (Qingdao Rirong AFA Memo).

Corroboration of Secondary Information Used As Adverse Facts Available

Section 776(c) of the Act provides that when the Department relies on the facts otherwise available and relies on “secondary information,” the Department shall, to the extent practicable, corroborate that information from independent sources reasonably at the Department's disposal. The Statement of Administrative Action, H.R. Doc. 103-316 (SAA), states that “corroborate” means to determine that the information used has probative value. See SAA at 870. To corroborate secondary information, the Department will, to the extent practicable, examine the reliability and relevance of the information to be used.

With respect to China Kingdom, Fujian Pelagic, Qingdao Zhengri/Yancheng Yaou, Shantou SEZ, Suqian Foreign Trade, Yancheng Foreign Trade, and Yangzhou Lakebest, we are applying the highest rate from any previous segment of this administrative proceeding as adverse facts available, which is a rate calculated in the 1999-2000 review. However, unlike other types of information, such as input costs or selling expenses, there are no independent sources for calculated dumping margins. The only source for calculated margins is administrative determinations. Thus, in an administrative review, if the Department chooses as total adverse facts available a calculated dumping margin from the current or a prior segment of the proceeding, it is not necessary to question the reliability of the margin for that time period. See, e.g., Grain-Oriented Electrical Steel From Italy; Preliminary Results of Antidumping Duty Administrative Review, 61 FR 36551, 36552 (July 11, 1996). With respect to the relevance aspect of corroboration, however, 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 adverse facts available, 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 (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 discredited. 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). None of these unusual circumstances are present here.

Accordingly, we determine that the highest rate from any previous segment of this administrative proceeding (i.e., the calculated rate of 223.01 percent) is in accord with section 776(c)'s requirement that secondary information be corroborated (i.e., that it have probative value). The information used in calculating this margin was based on sales and production data of a respondent in a prior review, as well as on the most appropriate surrogate value information available to the Department, chosen from submissions by the parties in that review, as well as information gathered by the Department itself. Furthermore, the calculation of this margin was subject to comment from interested parties in the proceeding. See Freshwater Crawfish Tail Meat from the People's Republic of China; Notice of Final Results of Antidumping Duty Administrative Review, and Final Partial Rescission of Antidumping Duty Administrative Review, 67 FR 19546 (April 22, 2002). Moreover, as there is no information on the record of this review that demonstrates that this rate is not appropriately used as adverse facts available for Fujian Pelagic, Shantou SEZ, Suqian Foreign Trade, Yancheng Foreign Trade, Yangzhou Lakebest, China Kingdom, and Qingdao Zhengri/Yancheng Yaou, we determine that this rate has probative value.

With respect to Qingdao Rirong, the factors we are using for partial adverse facts available constitute primary information on the record of this review. Corroboration within the meaning of the SAA (see SAA at 870) and section 776(c) of the Act is therefore not necessary. In addition, there is no information on the record of this review demonstrating that the factors selected are not appropriate as adverse facts available for Qingdao Rirong.

Verification

As provided in section 782(i) of the Act, we attempted to verify the responses of Qingdao Rirong and China Kingdom. We used standard verification procedures, including on-site inspection of the manufacturers' facilities and the examination of relevant sales and financial records. However, as described in the “Application of Facts Available” section above, we encountered problems at the verification of the questionnaire responses submitted by both China Kingdom and Qingdao Rirong. See China Kingdom Verification Report at 10 and Qingdao Rirong Verification Report at 1-2; see also China Kingdom AFA Memo and Qingdao Rirong AFA Memo. Our verification results are outlined in the public versions of the verification reports, on file in the CRU, Room B-099 of the main Department building.

Separate Rates

To establish whether a company operating in a non-market economy country (NME) is sufficiently independent to be entitled to a separate rate, the Department analyzes each exporting entity under the test established in the Final Determination of Sales at Less Than Fair Value: Sparklers from the People's Republic of China, 56 FR 20588 (May 6, 1991), as amplified by the Final Determination of Sales at Less Than Fair Value: Silicon Carbide from the People's Republic of China, 59 FR 22585 (May 2, 1994). Under this policy, exporters in NMEs are entitled to separate, company-specific margins when they can demonstrate an absence of government control, both in law and in fact, with respect to export activities. Evidence supporting, though not requiring, a finding of de jure absence of government control over export activities includes: 1) an absence of restrictive stipulations associated with an individual exporter's business and export licenses; 2) any legislative enactments decentralizing control of companies; and 3) any other formal measures by the government decentralizing control of companies. De facto absence of government control over exports is based on four factors: 1) whether each exporter sets its own export prices independently of the government and without the approval of a government authority; 2) whether each exporter retains the proceeds from its sales and makes independent decisions regarding the disposition of profits or financing of losses; 3) whether each exporter has the authority to negotiate and sign contracts and other agreements; and 4) whether each exporter has autonomy from the government regarding the selection of management.

De Jure Control

In their questionnaire responses, both Qingdao Rirong and China Kingdom stated that they are independent legal entities. Qingdao Rirong also stated that it is a PRC-foreign joint venture. Evidence on the record indicates that the government does not have de jure control over either Qingdao Rirong's or China Kingdom's export activities. Both companies submitted evidence of their legal right to set prices independent of all government oversight. Furthermore, the business licenses of Qingdao Rirong and China Kingdom indicate that each is permitted to engage in the exportation of crawfish. We also found no evidence of de jure government control restricting either entity's exportation of crawfish.

In their responses, Qingdao Rirong and China Kingdom both stated that no export quotas apply to crawfish. Prior verifications have confirmed that there are no commodity-specific export licenses required and no quotas for the seafood category “Other,” which includes crawfish, in China's Tariff and Non-Tariff Handbook for 1996. In addition, we have previously confirmed that crawfish is not on the list of commodities with planned quotas in the 1992 PRC Ministry of Foreign Trade and Economic Cooperation document entitled Temporary Provisions for Administration of Export Commodities. See Freshwater Crawfish Tail Meat From the People's Republic of China; Preliminary Results of New Shipper Review, 64 FR 8543 (February 22, 1999) and Freshwater Crawfish Tail Meat From the People's Republic of China; Final Results of New Shipper Review, 64 FR 27961 (May 24, 1999) (Ningbo New Shipper Review).

The following laws, which have been placed on the record of this review, indicate a lack of de jure government control over companies owned by “all the people” and that control over these enterprises has been transferred from the government to the enterprises themselves. The Administrative Regulations of the People's Republic of China for Controlling the Registration of Enterprises as Legal Persons (Legal Persons Law), issued on July 13, 1988 by the State Administration for Industry and Commerce of the PRC provide that, to qualify as legal persons, companies must have the “ability to bear civil liability independently” and the right to control and manage their businesses. These regulations also state that as an independent legal entity, a company is responsible for its own profits and losses. Both Qingdao Rirong and China Kingdom also provided copies of the Foreign Trade Law of the PRC, which identifies the rights and responsibilities of business enterprises with foreign investment, grants autonomy to foreign trade operators in management decisions, and establishes the foreign trade operator's accountability for profits and losses. Both entities also provided copies of their business and export licenses. We therefore preliminarily determine that there is an absence of de jure control over the export activities of Qingdao Rirong and China Kingdom.

De Facto Control

With respect to the absence of de facto control over export activities, information on the record indicates that, for both Qingdao Rirong and China Kingdom, management for each company is responsible for all decisions concerning export strategies, export prices, profit distribution, and contract negotiations, and that there are no governmental policy directives that affect management's decisions. Furthermore, each company's pricing and export strategy decisions are not subject to any outside entity's review or approval. Information on the record also indicates that there is no government involvement in the daily operations or the selection of management for either company.

There are no restrictions on the use of revenues or profits including export earnings for either Qingdao Rirong or China Kingdom. Each company's general manager has the right to negotiate and enter into contracts, and may delegate this authority to employees within the company. There is no evidence that this authority is subject to any level of governmental approval. Qingdao Rirong has stated that its management is selected by its board of directors and/or its employees, while China Kingdom has stated that its management is selected by its board of directors alone. Both companies have indicated that there is no government involvement in the management selection process. Lastly, decisions made by Qingdao Rirong and China Kingdom concerning purchases of subject merchandise from other suppliers are not subject to government approval. We therefore preliminarily determine that there is an absence of de facto control over the export activities of Qingdao Rirong and China Kingdom.

Consequently, because evidence on the record indicates an absence of government control, both in law and in fact, over their export activities, we preliminarily determine that Qingdao Rirong and China Kingdom are each eligible for a separate rate.

Normal Value Comparisons

To determine whether Qingdao Rirong's sales of the subject merchandise to the United States were made at prices below NV, we compared its export prices to NV, as described in the Export Price and Normal Value sections of this notice. As discussed above in the Application of Facts Available section, we have applied partial adverse facts available in determining the factors of production used in the calculation of NV.

Export Price

For Qingdao Rirong, we based United States price on EP in accordance with section 772(a) of the Act, because the first sales to unaffiliated purchasers were made prior to importation, and CEP was not otherwise warranted by the facts on the record. We calculated EP based on packed prices from the exporter to the first unaffiliated purchaser in the United States. Where applicable, we deducted foreign inland freight, inland insurance, and brokerage and handling expenses in the home market from the starting price (gross unit price) in accordance with section 772(c) of the Act.

Normal Value

For companies located in NME countries, section 773(c)(1) of the Act provides that the Department shall determine NV using a factors-of-production methodology if (1) the merchandise is exported from an NME country, and (2) available information does not permit the calculation of NV using home-market prices, third-country prices, or constructed value under section 773(a) of the Act.

In every case conducted by the Department involving the PRC, the PRC has been treated as an 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. None of the companies contested such treatment in these reviews. Accordingly, we have applied surrogate values to the factors of production to determine NV. See Memorandum to the File, through Maureen Flannery, Program Manager, Office of AD/CVD Enforcement VII, from Adina Teodorescu, Case Analyst, Re.: Administrative Review of Freshwater Crawfish Tail Meat from the People's Republic of China; Factor Values Memorandum, dated September 30, 2002 (Factor Values Memorandum). We calculated NV based on factors of production in accordance with section 773(c)(4) of the Act and section 351.408(c) of our regulations. Consistent with the original investigation and prior administrative reviews of this order, we determined that India (1) is comparable to the PRC in level of economic development, and (2) is a significant producer of comparable merchandise. See Memorandum from the Office of Policy to Maureen Flannery, Program Manager, Group III/Office 7 of AD/CVD, dated June 13, 2002 (Policy Memo). With the exceptions of the crawfish input and the shell scrap, we valued the factors of production using publicly available information from India. We adjusted the Indian import prices by adding freight expenses to make them delivered prices.

In the original investigation of sales at less than fair value (LTFV) and in previous reviews of this order, for the crawfish input, we used Spanish import statistics for live freshwater crawfish imported from Portugal. However, in the final results of two subsequent new shipper reviews and the most recently completed administrative review, the Department found that Spanish imports of live freshwater crawfish from Portugal had declined drastically. Consequently, the Department found that the most appropriate surrogate value was the price paid by crawfish processors to crawfish fishermen/harvesters for live crawfish up to 40 grams in weight in Australia. See Freshwater Crawfish Tail Meat from the People's Republic of China; Notice of Final Results of Antidumping Duty Administrative Review, and Final Partial Rescission of Antidumping Duty Administrative Review, 67 FR 19546 (April 22, 2002) (99/00 Final Results).

Submissions placed on the record of the current administrative review indicate that the appropriate basis for the valuation of the live crawfish input remains a significant issue. Consequently, the Department conducted additional research in an attempt to identify the best available information among the possible options for valuing the live crawfish input. Based on this research, we found that Spanish imports of Portugese crawfish increased significantly, and that the market appears to have recovered. See Memorandum to Barbara E. Tillman, Director, Office of AD/CVD Enforcement VII, through Maureen Flannery, Program Manager, from Matthew Renkey and Scot Fullerton, Analysts: Selection of Surrogate for the Valuation of Whole, Live Freshwater Crawfish in the 2000 - 2001 Administrative and New Shipper Reviews for Freshwater Crawfish Tail Meat from the People's Republic of China (August 5, 2002) (Crawfish Valuation Memo). Information concerning these imports is publicly available, published, and regularly maintained by the Spanish government. Section 773(c)(4) of the Act, as amended, provides that in valuing the factors of production, the Department should use, to the extent possible, the prices or costs of factors of production in one or more market economy countries that are at a level of economic development comparable to that of the NME country and are significant producers of comparable merchandise. While Spain is not at the same level of economic development as the PRC, we find that there is no reliable or usable publicly available information to value live crawfish from the surrogate countries identified by the Office of Policy. See Memorandum to the File, through Maureen Flannery, Program Manager, AD/CVD Enforcement VII, from Christian Hughes and Doug Campau, Case Analysts: Surrogate Value Research; Crawfish Tail Meat from the People's Republic of China (PRC): Administrative Review 9/1/00-8/31/01 and New Shipper Reviews 9/1/00-8/31/01 and 9/1/00-10/15/01 (August 5, 2002). Since the trade in live freshwater crawfish between Spain and Portugal recovered during the 2000-2001 POR, and since it appears that the recovery is not likely to be an aberration, such published official government import data is the preferred source of valuing the factors of production. Accordingly, the Department is using the Spanish import statistics to value the live freshwater crawfish input for purposes of this administrative review.

In previous reviews, the Department has used a Canadian free-on-board (FOB) factory price quote for dried crab and shrimp shells to value crawfish shell scrap. Because this surrogate price was on a dry-weight basis, whereas shells were sold wet by the Chinese exporter, we converted the dry-weight price to a wet-weight basis to reflect the value of the shell scrap. See 99/00 Final Results For this review, we have obtained price quotes from Indonesia for wet and dried crab and shrimp shells. Indonesia is the only country identified for this review as a surrogate country comparable to the PRC for which we were able to obtain public surrogate value information on shell scrap. See Policy Memo. Furthermore, we have a price from Indonesia for wet shells, as well as a price for dried shells. Therefore, we used the price of wet crab and shrimp shells from Indonesia to value the scrap shell in this administrative review. See Memorandum to Barbara E. Tillman, Director, Office of AD/CVD Enforcement VII, through Maureen Flannery, Program Manager, from Christian Hughes and Adina Teodorescu, Case Analysts: Surrogate Valuation of Shell Scrap: Freshwater Crawfish Tail Meat from the People's Republic of China (PRC), Administrative Review 9/1/00-8/31/01 and New Shipper Reviews 9/1/00-8/31/01 and 9/1/00-10/15/01 (August 5, 2002).

We valued the factors of production as follows:

To value the input of whole live crawfish, we used publicly available Spanish import data of whole live crawfish from Portugal for September 2000 through August 2001. See Crawfish Valuation Memo. We adjusted the values of whole live crawfish to include freight costs incurred between the supplier and the factory. For transportation distances used in the calculation of freight expenses on whole live crawfish, we added to the surrogate values a surrogate freight cost using the shorter of (a) the distances between the closest PRC port and the factory, or (b) the distance between the domestic supplier and the factory. See Notice of Final Determination of Sales at Less than Fair Value: Collated Roofing Nails from the People's Republic of China, 62 FR 51410 (October 1, 1997) (Roofing Nails).

To value crawfish scrap, we used a price quote from Indonesia for crab and shrimp shells. For further details, see Factors Value Memorandum.

To value coal, we relied upon Indian import data for steam coal for the period August 2000 through January 2001 from the Monthly Statistics of the Foreign Trade of India (Monthly Statistics). We adjusted the cost of coal to include an amount for transportation. To value electricity, we used the average of the 1997 total cost per kilowatt hour (KWH) for “Electricity for Industry” as reported in the International Energy Agency's publication, Energy Prices and Taxes, First Quarter, 2000. For water, we relied upon public information from the October 1997 Second Water Utilities Data Book: Asian and Pacific Region, published by the Asian Development Bank. To achieve comparability of electricity and water prices to the factors reported for the POR, we adjusted these factor values to reflect inflation to the POR using the Wholesale Price Index (WPI) for India, as published in the 2001 International Financial Statistics (IFS) by the International Monetary Fund (IMF).

To value packing materials (plastic bags, cardboard boxes and adhesive tape), we relied upon Indian import data for the period August 2000 through January 2001 from the Monthly Statistics. We adjusted the values of packing materials to include freight costs incurred between the supplier and the factory. For transportation distances used in the calculation of freight expenses on packing materials, we added, to surrogate values from India, a surrogate freight cost using the shorter of (a) the distances between the closest PRC port and the factory, or (b) the distance between the domestic supplier and the factory. See Roofing Nails.

To value factory overhead, selling, general, and administrative expenses (SG&A) and profit, we calculated simple average rates using publicly available 1996-97 financial statements of four Indian seafood processing companies, and applied these rates to the calculated cost of manufacture. See Factor Values Memorandum.

For labor, we used the PRC regression-based wage rate at Import Administration's home page, Import Library, Expected Wages of Selected NME Countries, revised in September 2002. See http://ia.ita.doc.gov/​wages/​. Because of the variability of wage rates in countries with similar per capita gross domestic products, section 351.408(c)(3) of the Department's regulations requires the use of a regression-based wage rate. The source of these wage rate data on the Import Administration's Web site is the Year Book of Labour Statistics 2001, International Labour Office (Geneva: 2001), Chapter 5B: Wages in Manufacturing.

We valued movement expenses as follows:

To value truck freight expenses we used nineteen Indian price quotes as reported in the February 14, 2000 issue of The Financial Express, which were used in the antidumping duty investigation of certain circular welded carbon-quality steel pipe from the PRC. See Notice of Final Determination of Sales at Less than Fair Value: Certain Circular Welded Carbon-Quality Steel Pipe from the People's Republic of China, 67 FR 36570 (May 24, 2002) (China Pipe). We adjusted the rates to reflect inflation to the POR of the finished product using the WPI for India from the IFS.

To value brokerage and handling, we used a publicly summarized version of the average value for brokerage and handling expenses reported in Final Determination of Sales at Less Than Fair Value: Certain Hot-Rolled Carbon Steel Flat Products from India, 67 FR 50406 (October 3, 2001) (Hot-Rolled from India), which was also used in China Pipe. We used the average of the foreign brokerage and handling expenses reported in the U.S. sales listing of the public questionnaire response submitted in the antidumping investigation of Essar Steel Ltd. in Hot-Rolled from India. Charges were reported on a per metric ton basis. We adjusted these values to reflect inflation to the POR using the WPI for India from the IFS. For further discussion, see Factor Values Memorandum.

Currency Conversion

For purposes of these preliminary results, we made currency conversions in accordance with section 773A(a) of the Act, based on the exchange rates in effect on the dates of the U.S. sales, as certified by the Federal Reserve Bank of New York. (See http://ia.ita.doc.gov/​exchange/​index.html.)

Preliminary Results of Review

We preliminarily determine that the following dumping margins exist:

Manufacturer/Exporter	Time Period	Margin (percent)
Qingdao Rirong	9/1/00-8/31/01	0.00
China Kingdom	9/1/00-8/31/01	223.01
PRC-Wide Rate1	9/1/00-8/31/01	223.01
1 Fujian Pelagic, Qingdao Zhengri/Yancheng Yaou, Shantou SEZ, Suqian Foreign Trade, Yancheng Foreign Trade, and Yangzhou Lakebest are included in the PRC-wide rate.

Cash Deposit Requirements

The following deposit rates will be effective upon publication of the final results of this administrative review for all shipments of freshwater crawfish tail meat from the PRC 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) If the margin for Qingdao Rirong remains zero, no cash deposits would be required for shipments exported by Qingdao Rirong. If Qingdao Rirong's margin is above de minimis in the final results, for subject merchandise exported by Qingdao Rirong, the cash deposit rate will be the total amount of antidumping duties due, divided by the total quantity exported during the POR. China Kingdom's rate will be the rate established in the final results. (2) For other exporters with separate rates, the deposit rate will be the company-specific per-kilogram or ad valorem rate established for the most recent period, as applicable. (3) For all other PRC exporters, the rate will be the PRC-wide rate, 223.01 percent. (4) For all other non-PRC exporters of subject merchandise from the PRC, the cash deposit rate will be the rate applicable to the PRC supplier of that exporter.

Comments and Hearing

Parties to the proceeding may request disclosure within 5 days of the date of publication of this notice in accordance with 19 CFR 351.224(b). Any interested party may request a hearing within 30 days of publication in accordance with 19 CFR 351.310(c). Any hearing would normally be held two days after the deadline for rebuttal briefs, or the first workday thereafter, at the U.S. Department of Commerce, 14th Street and Constitution Avenue N.W., Washington, DC 20230. Individuals who wish to request a hearing must submit a written request within 30 days of the publication of this notice in the Federal Register to the Assistant Secretary for Import Administration, U.S. Department of Commerce, Room 1870, 14th Street and Constitution Avenue, NW., Washington, DC 20230. Requests for a public hearing should contain: (1) the party's name, address, and telephone number; (2) the number of participants; and (3) a list of the issues to be discussed. Interested parties may submit case briefs within 30 days of the date of publication of this notice in accordance with 19 CFR 351.309(c)(2). Rebuttal briefs, which must be limited to issues raised in the case briefs, may be filed not later than 5 days after the due date for submission of case briefs. Parties who submit arguments are requested to submit with each argument (1) a statement of the issue and (2) a brief summary of the argument. If a hearing is held, an interested party may make an affirmative presentation only on arguments included in that party's case brief and may make a rebuttal presentation only on arguments included in that party's rebuttal brief. Parties should confirm by telephone the time, date, and place of the hearing 48 hours before the scheduled time.

The Department intends to issue the final results of this administrative review, which will include the results of its analysis of issues raised in any briefs, within 120 days from the date of publication of these preliminary results.

Assessment Rates

Upon completion of this administrative review, the Department shall determine, and the U.S. Customs Service shall assess, antidumping duties on all appropriate entries. The Department will issue appraisement instructions directly to the U.S. Customs Service upon completion of this review. For assessment purposes, for Qingdao Rirong, where appropriate, we will calculate importer-specific assessment rates for freshwater crawfish tail meat from the PRC. We will divide the total dumping margins (calculated as the difference between NV and EP) for each importer by the total quantity of subject merchandise sold by Qingdao Rirong to that importer during the POR. Upon the completion of this review, we will direct Customs to assess the resulting quantity-based rates against the weight in kilograms of each entry of the subject merchandise by the importer during the POR. See Memorandum to Barbara E. Tillman through Maureen Flannery, from Mark Hoadley: Collection of Cash Deposits and Assessment of Duties on Freshwater Crawfish from the PRC (August 27, 2001), and placed on the record of this review. Also upon completion of this review, for China Kingdom and all exporters subject to the PRC-wide rate, we will direct Customs to assess the resulting ad valorem rates against the entered value of each entry of the subject merchandise during the POR. The Department will issue appropriate assessment instructions directly to the Customs Service within 15 days of publication of the final results of review.

Notification to Importers

This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f) of the Department's regulations 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.

This administrative review and this notice are published in accordance with section 751(a)(1) of the Act, and sections 351.213 and 351.221 of the Department's regulations.

Dated: September 30, 2002.

Faryar Shirzad,

Assistant Secretary for Import Administration.