[Federal Register Volume 66, Number 232 (Monday, December 3, 2001)]
[Notices]
[Pages 60185-60192]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-29814]


-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-868]


Notice of Preliminary Determination of Sales at Less Than Fair 
Value: Folding Metal Tables and Chairs From the People's Republic of 
China

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

EFFECTIVE DATE: December 3, 2001.

FOR FURTHER INFORMATION CONTACT: Helen Kramer or John Drury, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 
20230; telephone: (202) 482-0405, and (202) 482-0195, respectively.

The Applicable Statute and Regulations

    Unless otherwise indicated, all citations to the Tariff Act of 
1930, as amended (``the Act''), are references to the provisions 
effective January 1, 1995, the effective date of the amendments made to 
the Act by the Uruguay Round Agreements Act (``URAA''). In addition, 
unless otherwise indicated, all citations to the Department's 
regulations are to the regulations codified at 19 CFR part 351 (2000).

Preliminary Determination

    We preliminarily determine that folding metal tables and chairs 
(``FMTC'') from the People's Republic of China (``PRC'') are being, or 
are likely to be, sold in the United States at less than fair value 
(``LTFV''), as provided in section 733 of the Act. The estimated 
margins of sales at LTFV are shown in the ``Suspension of Liquidation'' 
section of this notice.

Case History

    This investigation was initiated on May 17, 2001. See Initiation of 
Antidumping Duty Investigation: Folding Metal Tables and Chairs from 
the People's Republic of China, 66 FR 28728, May 24, 2001 (``Notice of 
Initiation''). The Department set aside a period for all interested 
parties to raise issues regarding product coverage. See Notice of 
Initiation at 28730. We received comments regarding product coverage as 
follows:
    (1) Cosco, Inc. (an importer of the merchandise under 
investigation) suggested on June 6, 2001, that folding tables and 
folding chairs should be considered as primarily of metal only if at 
least two structural components consist entirely of metal;
    (2) Meco Corporation (the petitioner) responded on June 18, 2001, 
that Cosco's suggested clarification was an impermissible attempt to 
change the intended scope of the investigation to exempt merchandise 
that the petition expressly covers, and to permit future

[[Page 60186]]

circumvention of antidumping duty order through minor alterations; and
    (3) On October 5, 2001, National Public Seating Corp. (``NPSC''), 
an importer, asked that certain double-hinged chairs be excluded from 
the scope. On October 26, 2001, Meco responded that the petition 
expressly covers the type of chair NPSC sought to exclude.
    On June 11, 2001, the United States International Trade Commission 
(``ITC'') issued its affirmative preliminary determination that there 
is a reasonable indication that an industry in the United States is 
materially injured by reason of imports of the subject merchandise from 
the PRC, which was published in the Federal Register on June 15, 2001. 
See Certain Folding Metal Tables and Chairs From China, 66 FR 32644.
    On June 21, 2001, the Department issued a questionnaire requesting 
volume and value of U.S. sales information to the Embassy of the PRC 
and to the Ministry of Foreign Trade and Economic Development, and sent 
courtesy copies to the following known producers/exporters of subject 
merchandise identified in the petition: Dongguan Shichang Metals 
Factory Co., Ltd., Xiamen New-Tec Jcc Co., Ltd., Samwise Hardware 
Products Factory, Office Max, Inc., Fujian Anxi Yinfa Handicrafts Co., 
Ltd., Shin Crest (Div. Taiwan Shin Yeh Enterprise Co.), Shian 
International Co., Tian Jian Industries (Group) Co. Ltd., China 
National Aero-Technology Import & Export Corp., Numark Industries Co., 
Ltd., Sun Son Trading Co. (Agent of Supper Chair Enterprise Co., Ltd.), 
Fujian Province Materials General Co., Xiaguang Industry Co., Ltd., 
China North Industries Guangzhou, Ningbo United Group Co., Ltd., China 
Precision Machinery, Xiamen Xiangjiang Imp. and Exp. Corp., Wuxi East 
Grace Garments Imp. Exp. Corp., Mitex International (H K) Ltd., and 
Nanhai Hongda Metal Products Co., Ltd. Additionally, we notified the 
PRC Government that it was responsible for ensuring that volume and 
value information for those companies and for all other companies not 
identified in our list be provided to the Department.
    A timely response to the Department's questionnaire seeking volume 
and value of U.S. sales information was received on July 9, 2001, from 
Dongguan Shichang Metals Factory Co. Ltd. (``Dongguan''). Because Feili 
Furniture Development Co., Ltd. and Feili (Fujian) Co., Ltd. (``Feili 
Group''), New-Tec Integration Co., Ltd. (``New-Tec'') and Shin Crest 
Pte. Ltd. (``Shin Crest'') did not file public versions of their 
original submissions in proper form on July 6 and 9, 2001, 
respectively, we rejected these submissions, but indicated they would 
be accepted if refiled in proper form. They were refiled in proper form 
on July 13, 2001, by Shin Crest and on July 16, 2001, by Feili Group 
and New-Tec. On August 3, 2001, the Department issued the respondent 
selection memorandum, selecting Feili Group and Shin Crest to be 
investigated (see Selection of Respondents section below). Additional 
responses were received on August 9, 2001, from Himark Industry Corp. 
Ltd. and on September 13, 2001, from Supper Chair Enterprise Co., Ltd., 
which were rejected by the Department as untimely.
    On July 12, 2001, Meco proposed product characteristics. On August 
6, 2001, the Department issued its antidumping questionnaire to Feili 
Group and Shin Crest and a letter to interested parties providing an 
opportunity to comment on the Department's proposed product 
characteristics. Comments were submitted on August 13, 2001 by Cosco 
proposing additional characteristics, which were not accepted by the 
Department.
    On August 7, 2001, the Department received requests from Dongguan 
and New-Tec to be treated as voluntary respondents in this 
investigation. Dongguan also requested that if it were not selected as 
a voluntary respondent that it be allowed to answer section A of the 
questionnaire and be granted a rate equal to the average of the 
mandatory respondents' rates.
    The Department received section A responses from Feili Group and 
New-Tec on August 27, 2001, and from Dongguan and Shin Crest on 
September 4, 2001. On September 7, 2001, petitioners submitted comments 
regarding respondents' section A responses. On September 12, 2001, the 
Department received a section C and D questionnaire response from 
Dongguan. On September 13, 2001, the Department issued section A 
supplemental questionnaires to Feili Group and Shin Crest and received 
sections C and D questionnaire responses from Feili Group, New-Tec and 
Shin Crest. The Department received responses from Feili Group and Shin 
Crest to its section A supplementals on September 27, 2001. On 
September 24, 2001, petitioners submitted comments on respondents' 
section C and D responses. On September 25 and 27, 2001, the Department 
issued sections C and D supplemental questionnaires to Shin Crest and 
Feili Group, respectively, and received responses on October 10 and 12, 
2001.
    On August 29, 2001, the Department issued a request for parties to 
submit comments on surrogate market-economy country selection, and 
publicly available information for valuing the factors of production. 
The petitioner and Feili Group submitted comments in response to these 
requests on September 28, 2001. On October 1, 2001, Shin Crest 
submitted surrogate value data to the Department. On October 9, 2001, 
and subsequent dates petitioner, Feili Group and Shin Crest provided 
additional information and comments on surrogate country selection and 
surrogate value data. The petitioner proposed to use Indonesia as the 
surrogate country, although Indian data were used in the petition. The 
respondents proposed to use India. See Surrogate Country section below.
    On October 4, 2001, petitioner alleged that Feili Group and Shin 
Crest purchased cold-rolled steel inputs from market-economy suppliers 
at prices that were below the producers' cost of production, or 
subsidized, or both. On October 15, 2001, Shin Crest commented that the 
Department's regulations and practice require the use of actual prices 
paid to market-economy suppliers in NME investigations. Feili Group 
commented on the same date that petitioner's argument regarding 
subsidized Korean steel prices is based on a case that was terminated 
by the ITC. On November 6, 2001, petitioner responded that the 
Department has the authority to disregard the price that an NME 
producer pays for an input purchased from a market-economy supplier if 
it has reason to believe or suspect that the input has been dumped or 
subsidized.
    In response to a request by petitioners for a thirty-day 
postponement of the preliminary determination, the Department postponed 
the deadline for the preliminary determination to November 5, 2001, 
pursuant to section 733(c)(1)(A) of the Act. See Notice of Postponement 
of Preliminary Antidumping Duty Determination: Folding Metal Tables and 
Chairs from the People's Republic of China, 66 FR 50608 (October 4, 
2001). On October 23, 2001, petitioners requested an additional 
postponement. On November 9, 2001, the Department published a notice 
extending the deadline to November 23, 2001 (66 FR 56635).

Period of Investigation

    The period of investigation (POI) is October 1, 2000 through March 
31, 2001. This period corresponds to the two most recent fiscal 
quarters prior to the month of the filing of the petition

[[Page 60187]]

(April 27, 2001). See 19 CFR 351.204(b)(1).

Scope of Investigation

    The merchandise subject to this investigation consists of assembled 
and unassembled folding tables and folding chairs made primarily or 
exclusively from steel or other metal, as described below:
    (1) Assembled and unassembled folding tables made primarily or 
exclusively from steel or other metal (``folding metal tables''). 
Folding metal tables include square, round, rectangular, and any other 
shapes with legs affixed with rivets, welds, or any other type of 
fastener, and which are made most commonly, but not exclusively, with a 
hardboard top covered with vinyl or fabric. Folding metal tables have 
legs that mechanically fold independently of one another, and not as a 
set. The subject merchandise is commonly, but not exclusively, packed 
singly, in multiple packs of the same item, or in five piece sets 
consisting of four chairs and one table. Specifically excluded from the 
scope of folding metal tables are the following:
     Lawn furniture;
     Trays commonly referred to as ``TV trays'';
     Side tables;
     Child-sized tables;
     Portable counter sets consisting of rectangular tables 36" 
high and matching stools; and
     Banquet tables. A banquet table is a rectangular table 
with a plastic or laminated wood table top approximately 28" to 36" 
wide by 48" to 96" long and with a set of folding legs at each end of 
the table. One set of legs is composed of two individual legs that are 
affixed together by one or more cross-braces using welds or fastening 
hardware. In contrast, folding metal tables have legs that mechanically 
fold independently of one another, and not as a set.
    (2) Assembled and unassembled folding chairs made primarily or 
exclusively from steel or other metal (``folding metal chairs''). 
Folding metal chairs include chairs with one or more cross-braces, 
regardless of shape or size, affixed to the front and/or rear legs with 
rivets, welds or any other type of fastener. Folding metal chairs 
include: Those that are made solely of steel or other metal; those that 
have a back pad, a seat pad, or both a back pad and a seat pad; and 
those that have seats or backs made of plastic or other materials. The 
subject merchandise is commonly, but not exclusively, packed singly, in 
multiple packs of the same item, or in five piece sets consisting of 
four chairs and one table. Specifically excluded from the scope of 
folding metal chairs are the following:
     Folding metal chairs with a wooden back or seat, or both;
     Lawn furniture;
     Stools;
     Chairs with arms; and
     Child-sized chairs.
    The subject merchandise is currently classifiable under subheadings 
9401710010, 9401710030, 9401790045, 9401790050, 9403200010 and 
9403200030 of the HTSUS. Although the HTSUS subheadings are provided 
for convenience and U.S. Customs Service purposes, the Department's 
written description of the merchandise is dispositive.

Selection of Respondents

    Section 777A(c)(1) of the Act directs the Department to calculate 
individual dumping margins for each known exporter and producer of the 
subject merchandise. However, section 777A(c)(2) of the Act gives the 
Department discretion, when faced with a large number of exporters/
producers, to limit its examination to a reasonable number of such 
companies if it is not practicable to examine all companies. Where it 
is not practicable to examine all known producers/exporters of subject 
merchandise, this provision permits the Department to investigate 
either: (A) A sample of exporters, producers, or types of products that 
is statistically valid based on the information available to the 
Department at the time of selection; or (B) exporters and producers 
accounting for the largest volume of the subject merchandise that can 
reasonably be examined. After consideration of the complexities 
expected to arise in this proceeding and the resources available to the 
Department, we determined that it was not practicable in this 
investigation to examine all known producers/exporters of subject 
merchandise. Instead, we limited our examination to two producers, 
based on the relative volumes of their reported U.S. sales during the 
POI.
    The subject merchandise is classified under broad HTSUS headings 
and cannot be distinguished from non-subject merchandise in official 
import statistics. Consequently, the Department could not use this 
information to determine the volume of imports of the subject 
merchandise. Therefore, to determine the two largest producers/
exporters of subject merchandise for the PRC, we relied on the data 
submitted by the producers/exporters in response to the Department's 
June 21, 2001, request for information, which was sent to all companies 
identified in the petition, as well as to the PRC Government and 
Embassy in Washington. The data submitted by the four producers/
exporters that submitted timely responses to the quantity and value 
questionnaire show that, of these producers/exporters, Feili Group and 
Shin Crest were the two largest producers/exporters of subject 
merchandise to the United States during the POI. Feili Group was not 
identified in the petition, but responded to the Department's request 
for information. While information submitted by petitioners indicates 
that these producers/exporters may not constitute the universe of 
possible producers/exporters of subject merchandise during the POI, 
because we did not receive any response from the PRC indicating what 
constitutes the complete universe, we must rely on data submitted by 
the four producers/exporters for purposes of respondent selection. See 
Memorandum from Richard O. Weible to Joseph A. Spetrini on Respondent 
Selection (August 3, 2001).

Non-Market Economy Country Status

    The Department has treated the PRC as a non-market economy 
(``NME'') country in all past antidumping investigations (see, e.g., 
Notice of Final Determination of Sales at Less Than Fair Value: Bulk 
Aspirin From the People's Republic of China, 65 FR 33805 (May 25, 
2000); Notice of Final Determination of Sales at Less Than Fair Value: 
Certain Non-Frozen Apple Juice Concentrate from the People's Republic 
of China, 65 FR 19873 (April 13, 2000) (Apple Juice)). A designation as 
an NME remains in effect until it is revoked by the Department (see 
section 771(18)(C) of the Act). No party to this investigation has 
requested a revocation of the PRC's NME status. We have, therefore, 
preliminarily determined to continue to treat the PRC as an NME 
country. When the Department is investigating imports from an NME, 
section 773(c)(1) of the Act directs us to base the normal value 
(``NV'') on the NME producer's factors of production, valued in a 
comparable market economy that is a significant producer of comparable 
merchandise. The sources of individual factor prices are discussed 
under the ``Normal Value'' section, below.
    Furthermore, no interested party has requested that the folding 
metal tables and chairs industry in the PRC be treated as a market-
oriented industry and no information has been provided that would lead 
to such a determination. Therefore, we have not treated the folding 
metal tables and chairs industry

[[Page 60188]]

in the PRC as a market-oriented industry in this investigation.

Separate Rates

    In proceedings involving NME countries, the Department begins with 
a rebuttable presumption that all companies within the country are 
subject to government control and thus should be assessed a single 
antidumping duty deposit rate. It is the Department's policy to assign 
all exporters of merchandise subject to investigation in an NME country 
this single rate, unless an exporter can demonstrate that it is 
sufficiently independent so as to be entitled to a separate rate. The 
two companies that the Department selected to investigate (i.e., Feili 
Group and Shin Crest) and the PRC companies that were not selected as 
mandatory respondents by the Department for this investigation, but 
which have submitted separate rates responses (i.e., New-Tec and 
Dongguan) have provided the requested separate rates information and 
have stated that, for each company, there is no element of government 
ownership or control.
    We considered whether each PRC company is eligible for a separate 
rate. The Department's separate rate test to determine whether the 
exporters are independent from government control does not consider, in 
general, macroeconomic/border-type controls, e.g., export licenses, 
quotas, and minimum export prices, particularly if these controls are 
imposed to prevent dumping. The test focuses, rather, on controls over 
the investment, pricing, and output decision-making process at the 
individual firm level. See, e.g., Certain Cut-to-Length Carbon Steel 
Plate from Ukraine: Final Determination of Sales at Less than Fair 
Value, 62 FR 61754, 61757 (November 19, 1997); Tapered Roller Bearings 
and Parts Thereof, Finished and Unfinished, from the People's Republic 
of China: Final Results of Antidumping Duty Administrative Review, 62 
FR 61276, 61279 (November 17, 1997).
    To establish whether a firm is sufficiently independent from 
government control of its export activities to be entitled to a 
separate rate, the Department analyzes each entity exporting the 
subject merchandise under a test arising out of the Final Determination 
of Sales at Less Than Fair Value: Sparklers from the People's Republic 
of China, 56 FR 20588 (May 6, 1991) (``Sparklers''), as amplified by 
Final Determination of Sales at Less Than Fair Value: Silicon Carbide 
from the People's Republic of China, 59 FR 22585 (May 2, 1994) 
(``Silicon Carbide''). In accordance with the separate rates criteria, 
the Department assigns separate rates in NME cases only if respondents 
can demonstrate the absence of both de jure and de facto governmental 
control over export activities.
1. Absence of De Jure Control
    The Department considers the following de jure criteria in 
determining whether an individual company may be granted a separate 
rate: (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. 
See Sparklers, 56 FR at 20508.
    All four PRC companies seeking separate rates reported that the 
subject merchandise was not subject to any government list regarding 
export provisions or export licensing, and was not subject to export 
quotas during the POI. Each company also submitted copies of its 
respective business license. We found no inconsistencies with the 
exporters' claims of the absence of restrictive stipulations associated 
with an individual exporter's business license. Our examination of the 
record indicates that each exporter submitted copies of the legislation 
of the PRC or documentation demonstrating the statutory authority for 
establishing the de jure absence of government control over the 
companies. Thus, we believe that the evidence on the record supports a 
preliminary finding of de jure absence of governmental control based 
on: (1) an absence of restrictive stipulations associated with the 
individual exporter's business license; and (2) the applicable 
legislative enactments decentralizing control of the companies.
2. Absence of De Facto Control
    The Department typically considers four factors in evaluating 
whether each respondent is subject to de facto governmental control of 
its export functions: (1) Whether the export prices are set by or are 
subject to the approval of a governmental agency; (2) whether the 
respondent has authority to negotiate and sign contracts and other 
agreements; (3) whether the respondent has autonomy from the government 
in making decisions regarding the selection of management; and (4) 
whether the respondent retains the proceeds of its export sales and 
makes independent decisions regarding disposition of profits or 
financing of losses. See Silicon Carbide, 59 FR at 22586-87; see also 
Notice of Final Determination of Sales at Less Than Fair Value: 
Furfuryl Alcohol From the People's Republic of China, 60 FR 22544, 
22545 (May 8, 1995). As stated in previous cases, there is some 
evidence that certain enactments of the PRC central government have not 
been implemented uniformly among different sectors and/or jurisdictions 
in the PRC. See Silicon Carbide, 56 FR at 22587. Therefore, the 
Department has determined that an analysis of de facto control is 
critical in determining whether respondents are, in fact, subject to a 
degree of governmental control which would preclude the Department from 
assigning separate rates.
    Regarding whether each exporter sets its own export prices 
independently of the government and without the approval of a 
government authority, each exporter reported that it determines its 
prices for sales of the subject merchandise based on the cost of the 
merchandise, movement expenses, overhead, profit, and the market 
situation in the United States. Each exporter stated that it negotiates 
prices directly with its customers. Also, each exporter claimed that 
its prices are not subject to review or guidance from any governmental 
organization. Regarding whether each exporter has authority to 
negotiate and sign contracts and other agreements, our examination of 
the record indicates that each exporter reported that it has authority 
to negotiate and sign contracts and other agreements. Also, each 
exporter claimed that its negotiations are not subject to review or 
guidance from any governmental organization. There is no evidence on 
the record to suggest that there is any governmental involvement in the 
negotiation of contracts.
    Regarding whether each exporter has autonomy in making decisions 
regarding the selection of management our examination of the record 
indicates that each exporter reported that it has autonomy in making 
decisions regarding the selection of management. Also, each exporter 
claimed that its selection of management is not subject to review or 
guidance from any governmental organization. There is no evidence on 
the record to suggest that there is any governmental involvement in the 
selection of management by the exporters.
    Regarding whether each exporter retains the proceeds from its sales 
and makes independent decisions regarding disposition of profits or 
financing of losses, our examination of the record indicates that each 
exporter reported that it retains the proceeds of its export sales, 
using profits according to its business needs. Also, each exporter 
reported that the allocation of profits is determined by its top 
management.

[[Page 60189]]

There is no evidence on the record to suggest that there is any 
governmental involvement in the decisions regarding disposition of 
profits or financing of losses.
    Therefore, we determine that the evidence on the record supports a 
preliminary finding of de facto absence of governmental control based 
on record statements and supporting documentation showing that: (1) 
Each exporter sets its own export prices independent of the government 
and without the approval of a government authority; (2) each exporter 
retains the proceeds from its sales and makes independent decisions 
regarding disposition of profits or financing of losses; (3) each 
exporter has the authority to negotiate and sign contracts and other 
agreements; and (4) each exporter has autonomy from the government 
regarding the selection of management.
    The evidence placed on the record of this investigation by 
Dongguan, Feili Group, New-Tec and Shin Crest demonstrates an absence 
of government control, both in law and in fact, with respect to each of 
the exporter's exports of the merchandise under investigation, in 
accordance with the criteria identified in Sparklers and Silicon 
Carbide. Therefore, for the purposes of this preliminary determination, 
we are granting separate rates to the two mandatory respondents, Feili 
Group and Shin Crest, and a rate equal to the weighted average of the 
mandatory respondents' rates (excluding zero or de minimis rates and 
rates based entirely on adverse facts available) to Dongguan and New-
Tec, which provided complete questionnaire responses, including 
supplemental responses. For a full discussion of this issue, see the 
memorandum from Helen Kramer to Richard Weible, Folding Metal Tables 
and Chairs from the People's Republic of China: Separate Rates Analysis 
for the Preliminary Determination, dated November 23, 2001 (``Separate 
Rates Memorandum'').

Facts Available

    Section 776(a) of the Act provides that, if an interested party 
withholds information that has been requested by the Department, fails 
to provide such information in a timely manner or in the form or manner 
requested, significantly impedes a proceeding under the antidumping 
statute, or provides information which cannot be verified, the 
Department shall use, subject to section 782(d) of the Act, facts 
otherwise available in reaching the applicable determination. Pursuant 
to section 782(e) of the Act, the Department shall not decline to 
consider submitted information if that information is necessary to the 
determination but does not meet all of the requirements established by 
the Department provided that all of the following requirements are met: 
(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 in providing the information and meeting 
Department requirements; and (5) the information can be used without 
undue difficulties.
    Section 776(a)(2)(B) of the Act requires the Department to use 
facts available when a party does not provide the Department with 
information by the established deadline or in the form and manner 
requested by the Department. In addition, section 776(b) of the Act 
provides that, if the Department finds that an interested party ``has 
failed to cooperate by not acting to the best of its ability to comply 
with a request for information,'' the Department may use information 
that is adverse to the interests of that party as facts otherwise 
available.

PRC-Wide Rate

    As discussed above (see ``Separate Rates''), all PRC producers/
exporters that do not qualify for a separate rate are treated as a 
single enterprise. As noted above in ``Case History,'' all producers/
exporters were given the opportunity to respond to the Department's 
questionnaire regarding volume and value of U.S. sales. As explained 
above, we received timely responses from Dongguan, Feili Group, New-
Tec, and Shin Crest. Late responses were submitted by Himark Industry 
Corp. Ltd. and Supper Chair Enterprise Co., Ltd. The Department did not 
receive responses from the following companies identified in the 
petition as exporters of the subject merchandise to the United States 
during the POI: Samwise Hardware Products Factory, Office Max, Inc., 
Fujian Anxi Yinfa Handicrafts Co., Ltd., Shian International Co., Tian 
Jian Industries (Group) Co. Ltd., China National Aero-Technology Import 
& Export Corp., Numark Industries Co., Ltd., Sun Son Trading Co. (Agent 
of Supper Chair Enterprise Co., Ltd.), Fujian Province Materials 
General Co., Xiaguang Industry Co., Ltd., China North Industries 
Guangzhou, Ningbo United Group Co., Ltd., China Precision Machinery, 
Xiamen Xiangjiang Imp. and Exp. Corp., Wuxi East Grace Garments Imp. 
Exp. Corp., Mitex International (H K) Ltd., and Nanhai Hongda Metal 
Products Co., Ltd.
    Because these companies did not respond to our June 21, 2001, 
request for information, we assume that these companies also exported 
the subject merchandise to the United States during the POI. 
Consequently, we are applying a single antidumping rate--the PRC-wide 
rate--to all other exporters in the PRC based on our presumption that 
those respondents who failed to demonstrate entitlement to a separate 
rate constitute a single enterprise under common control by the Chinese 
government. See, e.g., Final Determination of Sales at Less Than Fair 
Value: Synthetic Indigo from the People's Republic of China, 65 FR 
25706, 25707 (May 3, 2000). The PRC-wide rate applies to all entries of 
subject merchandise except for entries from Dongguan, Feili Group, New-
Tec, and Shin Crest.
    As set forth above, section 776(b) of the Act provides that, in 
selecting from among the facts available, the Department may employ 
adverse inferences against an interested party if that party failed to 
cooperate by not acting to the best of its ability to comply with 
requests for information. See also ``Statement of Administrative 
Action'' accompanying the URAA, H.R. Rep. No. 103-316, 870 (1994) 
(``SAA''). The Department finds that exporters (i.e., the single PRC 
entity) who did not respond to our request for information have failed 
to cooperate to the best of their ability. Therefore, the Department 
preliminarily finds that, in selecting from among the facts available, 
an adverse inference is appropriate. See, e.g., Notice of Preliminary 
Determination of Sales at Less Than Fair Value: Stainless Steel Wire 
Rod From Germany, 63 FR 10847 (March 5, 1998).
    Section 776(b) provides that an adverse inference may include 
reliance on information derived from (1) the petition, (2) the final 
determination in the investigation segment of the proceeding, (3) a 
previous review under section 751 of the Act or a determination under 
section 753 of the Act, or (4) any other information placed on the 
record. The Department's practice when selecting an adverse rate from 
among the possible sources of information is to ensure that the margin 
is sufficiently adverse ``as to effectuate the purpose of the facts 
available role to induce respondents to provide the Department with 
complete and accurate information in a timely manner.'' See Static 
Random Access Memory Semiconductors from Taiwan; Final Determination of 
Sales at Less than Fair

[[Page 60190]]

Value, 63 FR 8909, 8932 (February 23, 1998). The Department also 
considers the extent to which a party may benefit from its own lack of 
cooperation in selecting a rate. See Roller Chain, Other than Bicycle, 
from Japan; Notice of Final Results and Partial Recission of 
Antidumping Duty Administrative Review, 62 FR 60472, 60477 (November 
10, 1997). Accordingly, in order to ensure that the rate is 
sufficiently adverse so as to induce cooperation by the PRC entity, we 
have preliminarily assigned the highest dumping margin calculated in 
this segment of the proceeding, which is 134.77 percent, to the PRC 
entity, based on our presumption that those respondents who failed to 
demonstrate entitlement to a separate rate constitute a single 
enterprise under common control by the Chinese government. See, e.g., 
Final Determination of Sales at Less Than Fair Value: Synthetic Indigo 
from the People's Republic of China, 65 FR 25706, 25707 (May 3, 2000) 
(``Synthetic Indigo'').
    Because this is a preliminary margin, the Department will consider 
all margins on the record at the time of the final determination for 
the purpose of determining the most appropriate final PRC-wide margin. 
See Notice of Preliminary Determination of Sales at Less Than Fair 
Value: Solid Fertilizer Grade Ammonium Nitrate From the Russian 
Federation, 65 FR 1139 (January 7, 2000).

Surrogate Country

    When the Department is investigating imports from an NME country, 
section 773(c)(1) of the Act directs it to base NV, in most 
circumstances, on the NME producer's factors of production, valued in a 
surrogate market-economy country or countries considered to be 
appropriate by the Department. In accordance with section 773(c)(4) of 
the Act, the Department, in valuing the factors of production, shall 
utilize, to the extent possible, the prices or costs of factors of 
production in one or more market-economy countries that: (A) are at a 
level of economic development comparable to that of the NME country; 
and (B) are significant producers of comparable merchandise. The 
sources of the surrogate factor values are discussed under the NV 
section below.
    The Department has determined that India, Pakistan, Indonesia, Sri 
Lanka and the Philippines are countries comparable to the PRC in terms 
of economic development. See Memorandum from Jeffrey May to Richard 
Weible, ``Antidumping Duty Investigation of Folding Metal Tables and 
Chairs from the People's Republic of China,'' dated July 31, 2001. 
Customarily, we select an appropriate surrogate country based on the 
availability and reliability of data from the countries. For PRC cases, 
the primary surrogate country has most often been India, if it is a 
significant producer of comparable merchandise. In this case, we have 
found that India is a significant producer of comparable merchandise. 
See Surrogate Country Selection Memorandum to The File from John Drury 
and Helen M. Kramer, dated November 23, 2001, (``Surrogate Country 
Memorandum'').
    We used India as the primary surrogate country and, accordingly, we 
have calculated NV using Indian prices to value the PRC producers' 
factors of production, when available and appropriate. See Surrogate 
Country Memorandum. We have obtained and relied upon publicly available 
information wherever possible. See Factor Valuation Memorandum to The 
File from Case Analysts, dated November 23, 2001 (``Factor Valuation 
Memorandum'').
    In accordance with section 351.301(c)(3)(i) of the Department's 
regulations, for the final determination in an antidumping 
investigation, interested parties may submit publicly available 
information to value factors of production within 40 days after the 
date of publication of this preliminary determination.

Fair Value Comparisons

    To determine whether sales of folding metal tables and chairs to 
the United States by Feili Group and Shin Crest were made at less than 
fair value, we compared export price (``EP'') to normal value (``NV''), 
as described in the ``Export Price'' and ``Normal Value'' sections of 
this notice. In accordance with section 777A(d)(1)(A)(i) of the Act, we 
calculated weighted-average EPs.

Export Price

    In accordance with section 772(a) of the Act, export price is the 
price at which the subject merchandise is first sold (or agreed to be 
sold) before the date of importation by the producer or exporter of the 
subject merchandise outside of the United States to an unaffiliated 
purchaser in the United States or to an unaffiliated purchaser for 
exportation to the United States, as adjusted under subsection (c).
    In accordance with section 772(a) of the Act, we used EP for Feili 
Group and Shin Crest because the subject merchandise was sold directly 
to unaffiliated customers in the United States prior to importation and 
because CEP was not otherwise indicated. In accordance with section 
777A(d)(1)(A)(i) of the Act, we compared POI-wide weighted-average EPs 
to the NVs.

Feili Group

    We calculated weighted-average EP for Feili Group's U.S. sales, 
based on packed prices, F.O.B. port of export, to unaffiliated 
purchasers in the United States. We made deductions for movement 
expenses in accordance with section 772(c)(2)(A) of the Act. Feili 
Group reported that it paid a fee to an unaffiliated trucking company 
in the PRC which included all movement expenses. Therefore, Feili Group 
reported all movement expenses paid in a single field. The charges in 
this single field include brokerage and handling, and foreign inland 
freight. Because transportation for all sales was provided by a NME 
company, we based movement expenses associated with these sales on 
surrogate values.

Shin Crest

    We calculated EP for Shin Crest based on packed F.O.B. prices to 
unaffiliated purchasers in the United States. We made deductions for 
movement expenses in accordance with section 772(c)(2)(A) of the Act. 
These included domestic inland freight and brokerage and handling 
charges. Shin Crest reported that it used NME carriers for foreign 
inland freight to certain ports. We based these expenses for these 
sales on Indian surrogate freight rates and the distances to the 
respective ports. For other sales we used Shin Crest's reported foreign 
inland freight expenses paid to market-economy carriers. For all sales 
we used the reported brokerage and handling charges, which were paid to 
a market-economy company. See Factor Valuation Memorandum.

Normal Value

    Section 773(c)(1) of the Act provides that the Department shall 
determine the normal value (``NV'') using a factors-of-production 
methodology if: (1) The merchandise is exported from an NME country; 
and (2) the 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.
    Factors of production include: (1) Hours of labor required; (2) 
quantities of raw materials employed; (3) amounts of energy and other 
utilities consumed; and (4) representative capital costs. We used 
factors of production, reported by respondents, for materials, energy, 
labor, by-products, and packing.
    In accordance with 19 CFR 351.408(c)(1), the Department will

[[Page 60191]]

normally use publicly available information to value factors of 
production. However, the Department's regulations also provide that 
where a producer sources an input from a market economy and pays for it 
in market-economy currency, the Department employs the actual price 
paid for the input to calculate the factors-based NV. Id.; see also 
Lasko Metal Products v. United States, 43 F. 3d 1442, 1445-1446 (Fed. 
Cir. 1994) (``Lasko''). Respondents Feili Group and Shin Crest reported 
that some of their inputs were sourced from market economies and paid 
for in a market-economy currency. See Factor Valuation Memorandum, 
dated November 23, 2001 for a listing of these inputs.
    In accordance with section 773(c) of the Act, we calculated NV 
based on factors of production reported by respondents for the POI. To 
calculate NV, the reported per-unit factor quantities were multiplied 
by publicly available Indian surrogate values (except as noted below). 
In selecting the surrogate values, we considered the quality, 
specificity, and contemporaneity of the data. As appropriate, we 
adjusted input prices by including freight costs to make them delivered 
prices. Specifically, we added to Indian import surrogate values a 
surrogate freight cost using the shorter of the reported distance from 
the domestic supplier to the factory or the distance from the nearest 
seaport to the factory. This adjustment is in accordance with the Court 
of Appeals for the Federal Circuit's decision in Sigma Corp. v. United 
States, 117 F. 3d 1401 (Fed. Cir. 1997). For a detailed description of 
all surrogate values used for respondents, see Factor Valuation 
Memorandum.
    Except as noted below, we valued raw material inputs using the 
weighted-average unit import values for the period April 2000--February 
2001 derived from the Monthly Trade Statistics of Foreign Trade of 
India--Volume II--Imports (February 2001) (``Indian Import 
Statistics''). We valued electricity using the cost in India per kwh in 
1997 reported in U.S. dollars, adjusted for inflation using wholesale 
price indices published in the International Monetary Fund's 
International Financial Statistics. We valued water as reported for 
India in 1997 by the Asian Development Bank, adjusted for inflation. 
See Factor Valuation Memorandum.
    As noted above, respondents Shin Crest and Feili Group sourced 
certain raw material inputs from market-economy suppliers and paid for 
them in market-economy currencies. Specifically, Feili Group sourced 
cold-rolled steel, plastic pellets and polyester fabric from market-
economy suppliers. Shin Crest reported that it sourced cold-rolled 
steel coils, PVC sheets, polyester fabric, polyurethane foam, rivets, 
screws, polyethylene panels, plywood, plastic caps, plastic bags, 
cartons and powder paint from market-economy suppliers. For this 
preliminary determination, the Department has used the market-economy 
prices for the inputs listed above, in accordance with 19 CFR 
351.408(c)(1). We added to the weighted-average price for each input 
the Indian surrogate value for transporting the input to the factory, 
where appropriate (i.e., where the sales terms for the market-economy 
inputs were not delivered to the factory).
    For all instances in which respondents reported delivery by truck 
to calculate domestic inland freight, we used an average of multiple 
price quotes in September 2000 and April 2001 for transporting 
materials by truck between Mumbai (Bombay) and various Indian cities, 
which were reported by The Financial Express of India on its website. 
We converted the Indian rupee value to U.S. dollars.
    As noted above under Case History, the petitioner has urged the 
Department to reject the prices paid for cold-rolled steel. Section 
773(c)(1) of the Act requires the Department to use ``best available 
information'' to value a NME producer's factors of production. Section 
351.408(c)(1) of the Department's regulations describes our method for 
valuing factors of production, including our preference for using the 
price paid by a NME producer that imports the input, when the input is 
purchased from a market-economy supplier and paid for in a market-
economy currency. It is not the Department's practice to reject actual 
prices paid in market-economy currencies to market-economy suppliers, 
unless they are not at arm's length or if the amount purchased was 
insignificant. See Helical Spring Lock Washers from the People's 
Republic of China; Final Results of Antidumping Administrative Review, 
65 FR 31143 (May 16, 2000), Issues and Decision Memorandum at Comment 
1, where the Department stated:

    We do not believe that substituting a surrogate value for the 
price a NME producer actually paid to a market economy supplier for 
an input actually used to produce the merchandise being sold to the 
United States could meet the best available information standard 
imposed by the statute.

See also Shakeproof Assembly Components Division of Illinois Tool 
Works, Inc. v. United States, 2001 U.S. App. LEXIS 22491, Fed. Cir. 
Slip Op. 00-1521 (October 12, 2001). The Department intends to verify 
on-site the respondents' reported factor prices.
    Respondents identified steel scrap as a by-product which they 
claimed was sold. The Department has offset the respondents' cost of 
production by the amount of reported scrap. See Factor Valuation 
Memorandum for a discussion of the surrogate value used.
    For energy, to value electricity, we used 1997 data reported as the 
average Indian domestic prices within the category ``Electricity for 
Industry,'' published in the International Energy Agency's publication, 
Energy Prices and Taxes--Quarterly Statistics (Third Quarter 2000), as 
adjusted for inflation. We valued water using the Asian Development 
Bank's Second Water Utilities Data Book: Asian and Pacific Region 
(1997), adjusted for inflation. We valued LPG and diesel oil using 
prices as of June 2001 from India Infoline.
    For direct, indirect, and packing labor, consistent with section 
351.408(c)(3) of the Department's regulations, we used the PRC 
regression-based wage rate at Import Administration's home page, Import 
Library, Expected Wages of Selected NME Countries, revised in May 2000 
(see http://ia.ita.doc.gov/wages). The source of the wage rate data on 
the Import Administration's Web site is the 1999 Year Book of Labour 
Statistics, International Labor Office (Geneva: 1999), Chapter 5B: 
Wages in Manufacturing.
    To value factory overhead, selling, general and administrative 
expenses (``SG&A'') and profit, we used the audited financial 
statements for the year ended March 31, 2001, from an Indian producer 
of steel furniture, including the subject merchandise, Godrej & Boyce 
Manufacturing Company Ltd. (``Godrej''). See Factor Valuation 
Memorandum for the calculation of these ratios from Godrej's financial 
statements. The petitioner argued that the Department should use the 
financial statement of an Indonesian producer of steel furniture (but 
not the subject merchandise) to calculate the overhead, selling, 
general and administrative expenses (``SG&A'') and profit ratios. As 
discussed in the Surrogate Country Memorandum, India is the preferred 
surrogate country, and Godrej is a producer of comparable merchandise; 
therefore we used Godrej's financial statements rather than those of an 
Indonesian surrogate.
    Finally, to value material inputs for packing, we used the reported 
values for purchases from market-economy suppliers. For packing 
materials

[[Page 60192]]

purchased from NME sources, we used Indian Import Statistics data for 
the period April 1, 2000 through February 2001. See Factor Valuation 
Memorandum.

Verification

    As provided in section 782(i)(1) of the Act, we intend to verify 
company information relied upon in making our final determination.

Rate for Producers/Exporters That Responded to the Questionnaires

    For Dongguan and New-Tec, which were not selected as respondents, 
but provided separate rates information in section A and also responded 
to the sections C and D questionnaires, we have calculated a weighted-
average margin based on the rates calculated for those producers/
exporters that were selected to respond. The rate for these companies 
is analogous to the Department's calculation of the All Others rate 
(see section 735(c)5 of the Act). It is equal to an average of all 
calculated margins other than any zero or de minimis margins, or any 
margins determined entirely under section 776 of the Act. As Shin 
Crest's preliminary margin is zero, the rate for Dongguan and New-Tec 
is equal to Feili's margin.

Suspension of Liquidation

    In accordance with section 733(d) of the Act, we are directing the 
U.S. Customs Service to suspend liquidation of all imports of subject 
merchandise, except for merchandise produced and exported by Shin 
Crest, entered or withdrawn from warehouse for consumption on or after 
the date of publication of this notice in the Federal Register. We will 
instruct the U.S. Customs Service to require a cash deposit or the 
posting of a bond equal to the weighted-average amount by which the NV 
exceeds the EP, as indicated below. These suspension-of-liquidation 
instructions will remain in effect until further notice. The weighted-
average dumping margins are as follows:

------------------------------------------------------------------------
                                                              Weighted-
                                                               average
                   Exporter/manufacturer                       percent
                                                                margin
------------------------------------------------------------------------
Shin Crest Pte. Ltd........................................         0.00
Feili Furniture Development Co., Ltd. and Feili (Fujian)          134.77
 Co., Ltd..................................................
Dongguan Shichang Metals Factory Co. Ltd...................       134.77
New-Tec Integration Co., Ltd...............................       134.77
China-Wide.................................................       134.77
------------------------------------------------------------------------

International Trade Commission Notification

    In accordance with section 733(f) of the Act, we have notified the 
ITC of our determination of sales at LTFV. If our final determination 
is affirmative, the ITC will determine before the later of 120 days 
after the date of this preliminary determination or 45 days after our 
final determination whether the domestic industry in the United States 
is materially injured, or threatened with material injury, by reason of 
imports, or sales (or the likelihood of sales) for importation, of the 
subject merchandise.

Public Comment

    Case briefs or other written comments may be submitted to the 
Assistant Secretary for Import Administration no later than fifty days 
after the date of publication of this notice, and rebuttal briefs, 
limited to issues raised in case briefs, no later than fifty-five days 
after the date of publication of this preliminary determination. See 19 
CFR 351.309(c)(1)(i); 19 CFR 351.309(d)(1). A list of authorities used 
and an executive summary of issues should accompany any briefs 
submitted to the Department. This summary should be limited to five 
pages total, including footnotes. In accordance with section 774 of the 
Act, we will hold a public hearing, if requested, to afford interested 
parties an opportunity to comment on arguments raised in case or 
rebuttal briefs. Tentatively, any hearing will be held fifty-seven days 
after publication of this notice at the U.S. Department of Commerce, 
14th Street and Constitution Avenue, NW., Washington, DC 20230, at a 
time and location to be determined. Parties should confirm by telephone 
the date, time, and location of the hearing two days before the 
scheduled date. Interested parties who wish to request a hearing, or to 
participate if one is requested, must submit a written request to the 
Assistant Secretary for Import Administration, U.S. Department of 
Commerce, Room 1870, within 30 days of the date of publication of this 
notice. See 19 CFR 351.310(c). Requests 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. At the hearing, each 
party may make an affirmative presentation only on issues raised in 
that party's case brief, and may make rebuttal presentations only on 
arguments included in that party's rebuttal brief. See 19 CFR 
351.310(c).
    If this investigation proceeds normally, we will make our final 
determination no later than 75 days after the date of the preliminary 
determination.
    This determination is issued and published in accordance with 
sections 733(f) and 777(i)(1) of the Act.

    Dated: November 23, 2001.
Richard W. Moreland,
Acting Assistant Secretary for Import Administration.
[FR Doc. 01-29814 Filed 11-30-01; 8:45 am]
BILLING CODE 3510-DS-P