[Federal Register Volume 72, Number 81 (Friday, April 27, 2007)]
[Notices]
[Pages 20990-20994]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-8121]


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DEPARTMENT OF COMMERCE

International Trade Administration

A-570-875


Non-Malleable Cast Iron Pipe Fittings from the People's Republic 
of China: 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 
the third administrative review of the antidumping duty order on non-
malleable cast iron pipe fittings (``NMP fittings'') from the People's 
Republic of China (``PRC'') covering the period April 1, 2005, through 
March 31, 2006. We preliminarily determine to apply adverse facts 
available (``AFA'') with respect to Myland Industrial Co., Ltd. 
(``Myland''), and Buxin Myland (Foundry) Ltd. (``Buxin''), which failed 
to cooperate to the best of their ability and failed to demonstrate 
their eligibility for a separate rate.
    If these preliminary results are adopted in our final results of 
this review, we will instruct U.S. Customs and Border Protection 
(``CBP'') to assess antidumping duties on all appropriate entries of 
subject merchandise during the period of review (``POR''). Interested 
parties are invited to comment on these preliminary results. We will 
issue the final results no later than 120 days from the date of 
publication of this notice.

EFFECTIVE DATE: April 27, 2007.

FOR FURTHER INFORMATION CONTACT: Karine Gziryan and Mark Manning, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, NW, 
Washington, DC 20230; telephone: (202) 482-4081 and (202) 482-5253, 
respectively.

SUPPLEMENTARY INFORMATION:

Background

    On April 7, 2003, the Department published in the Federal Register 
the antidumping duty order on NMP fittings from the PRC. See Notice of 
Antidumping Duty Order: Non-Malleable Cast Iron Pipe Filings (Sic.)From 
the People's Republic of China, 68 FR 16765 (April 7, 2003). On April 
3, 2006, the Department published a notice of opportunity to request an 
administrative review of the antidumping duty order on NMP fittings 
from the PRC for the period April 1, 2005, through March 31, 2006. See 
Antidumping or Countervailing Duty Order, Finding, or Suspended 
Investigation; Opportunity to Request Administrative Review, 71 FR 
16549 (April 3, 2006). On April 20, 2006, Myland and Buxin requested an 
administrative review of their sales of NMP fittings to the United 
States during the POR. No other party requested a review of shipments 
made by Myland or Buxin. On April 28, 2006, Ward Manufacturing, Inc. 
(``Ward''), a domestic producer of NMP fittings, requested an 
administrative review of the sales to the United States during the POR 
of subject merchandise produced and/or exported by Jinan Meide 
Corporation (``JMC'') and Shanghai Foreign Trade Enterprises Co., Ltd. 
(``SFTEC''). On May 31, 2006, the Department published in the Federal

[[Page 20991]]

Register a notice of the initiation of the antidumping duty 
administrative review of NMP fittings from the PRC for the period April 
1, 2005, through March 31, 2006. See Initiation of Antidumping and 
Countervailing Duty Administrative Reviews and Request for Revocation 
in Part, 71 FR 30864 (May 31, 2006) (``Initiation Notice'').
    On July 25, 2006, Ward timely withdrew its request for an 
administrative review of NMP fittings from the PRC regarding subject 
merchandise produced and/or exported by JMC and SFTEC. No other 
interested party requested a review of JMC and SFTEC. Therefore, the 
Department rescinded this review with respect to JMC and SFTEC, in 
accordance with 19 CFR 351.213(d)(1). See Non-Malleable Cast Iron Pipe 
Fittings from the People's Republic of China: Notice of Partial 
Rescission of Antidumping Duty Administrative Review, 71 FR 55430 
(September 22, 2006).
    On July 24, 2006, the Department issued its antidumping 
questionnaire to Myland and Buxin. Myland and Buxin submitted a Section 
A questionnaire response on August 11, 2006, and Sections C and D 
responses on September 12, 2006. On December 7, 2006, the Department 
published a notice in the Federal Register extending the time limit for 
the preliminary results of review until April 30, 2007. See Non-
Malleable Cast Iron Pipe Fittings from the Peoples'(Sic.) Republic of 
China; Notice of Extension of Time Limit for Preliminary Results of 
Antidumping Duty Administrative Review, 71 FR 70957 (December 7, 2006). 
From November 2006 to February 2007, the Department issued, and Myland 
and Buxin responded to, six supplemental questionnaires.
    The verification of the respondents' responses was scheduled from 
March 12 through March 17, 2007. On February 23, 2007, the Department 
released the verification agenda to Myland and Buxin. From March 12 
through March 13, 2007, the Department conducted verification of Myland 
in Hong Kong. On March 14, 2007, the verification team arrived in 
Guangzhou, China, to continue verification at Buxin. On that day, 
Myland and Buxin refused to allow the verification team access to 
Buxin's factory, refused to provide the information requested in the 
verification agenda, informed the verification team that they were 
unable to continue participating in the verification, and withdrew from 
the verification. See Memorandum from Karina Gziryan and Melissa 
Blackledge, to the File, ``Non-Malleable Cast Iron Pipe Fittings from 
the People's Republic of China - Administrative Review,'' dated March 
27, 2007. Myland and Buxin destroyed the verification exhibits taken in 
Hong Kong, and did not serve those exhibits on the petitioner or the 
Department. Id. On March 21, 2007, Myland and Buxin filed a letter in 
which they withdrew their request to conduct the administrative review 
and consented to the assessment of antidumping duties at the PRC-wide 
rate.

Period of Review

    The POR is April 1, 2005, through March 31, 2006.

Scope of Order

    The products subject to this administrative review are finished and 
unfinished non-malleable cast iron pipe fittings with an inside 
diameter ranging from 1/4 inch to 6 inches, whether threaded or un-
threaded, regardless of industry or proprietary specifications. The 
subject fittings include elbows, ells, tees, crosses, and reducers as 
well as flanged fittings. These pipe fittings are also known as ``cast 
iron pipe fittings'' or ``gray iron pipe fittings.'' These cast iron 
pipe fittings are normally produced to ASTM A-126 and ASME B.l6.4 
specifications and are threaded to ASME B1.20.1 specifications. Most 
building codes require that these products are Underwriters 
Laboratories (``UL'') certified. The scope does not include cast iron 
soil pipe fittings or grooved fittings or grooved couplings.
    Fittings that are made out of ductile iron that have the same 
physical characteristics as the gray or cast iron fittings subject to 
the scope above or which have the same physical characteristics and are 
produced to ASME B.16.3, ASME B.16.4, or ASTM A-395 specifications, 
threaded to ASME B1.20.1 specifications and UL certified, regardless of 
metallurgical differences between gray and ductile iron, are also 
included in the scope of the order. These ductile fittings do not 
include grooved fittings or grooved couplings. Ductile cast iron 
fittings with mechanical joint ends (``MJ''), or push on ends (``PO''), 
or flanged ends and produced to the American Water Works Association 
(``AWWA'') specifications AWWA C110 or AWWA C153 are not included.
    Imports of subject merchandise are currently classifiable in the 
Harmonized Tariff Schedule of the United States (``HTSUS'') under item 
numbers 7307.11.00.30, 7307.11.00.60, 7307.19.30.60 and 7307.19.30.85. 
HTSUS subheadings are provided for convenience and customs purposes. 
The written description of the scope of this proceeding is dispositive.

Nonmarket Economy Country Status

    In every case conducted by the Department involving the PRC, the 
PRC has been treated as a nonmarket economy (``NME'') country. In 
accordance with section 771(18)(C)(i) of the the Tariff Act of 1930, as 
amended (``the Act''), any determination that a foreign country is an 
NME country shall remain in effect until revoked by the administering 
authority. See Tapered Roller Bearings and Parts Thereof, Finished and 
Unfinished, From the People's Republic of China: Preliminary Results of 
2001-2002 Administrative Review and Partial Rescission of Review, 68 FR 
7500 (February 14, 2003) (unchanged in final results of review). None 
of the parties to this proceeding has contested such treatment. 
Therefore, we have treated the PRC as an NME country for purposes of 
these preliminary results.

Request for Withdrawal of Administrative Review

    As noted above, Myland and Buxin submitted a letter to the 
Department withdrawing their request for an administrative review on 
March 21, 2007. Pursuant to 19 CFR 351.213(d)(1), ``the Secretary will 
rescind an administrative review under this section, in whole or in 
part, if a party that requested a review withdraws the request within 
90 days of the date of publication of notice of initiation of the 
requested review. The Secretary may extend this time limit if the 
Secretary decides that it is reasonable to do so.'' The 90-day deadline 
for withdrawing from this administrative review expired on August 29, 
2006. Therefore, Myland's and Buxin's request to withdraw from the 
administrative review was submitted after the deadline established by 
the Department.
    The Department reviewed and analyzed Myland's and Buxin's response 
to the Department's original questionnaire. As a result of the 
respondents' deficient and/or incomplete questionnaire responses, the 
Department sent six supplemental questionnaires in an attempt to gather 
necessary information from the respondents. Because of the need to 
issue an extensive number of supplemental questionnaires, the 
Department extended the deadline for the preliminary results. In March 
2007, the Department attempted to verify Myland's and Buxin's responses 
in their offices in Hong Kong and China. See Background section of this 
notice, above. The Department expended considerable effort and 
resources in its analysis of Myland and Buxin prior to

[[Page 20992]]

their late withdrawal request during an advanced stage of the review. 
Therefore, the Department is not granting the respondents' request to 
withdraw their request for review. This is consistent with past 
Department practice. See Antifriction Bearings and Parts Thereof from 
France, Germany, Italy, Japan, Singapore, and the United Kingdom: 
Preliminary Results Of Antidumping Duty Administrative Reviews, Partial 
Rescission Of Administrative Reviews, Notice Of Intent to Rescind 
Administrative Reviews, And Notice Of Intent To Revoke Order In Part, 
69 FR 5949, 5951 (February 9, 2004) (``Although we have accepted 
untimely withdrawals of requests for review elsewhere, the 
circumstances surrounding the review of INA are different from other 
situations . . . {because{time}  we had expended effort and resources 
in our analysis of INA prior to the untimely withdrawal such that we 
were quite advanced in the review'') (unchanged in final results of 
review). See also, Petroleum Wax Candles From the People's Republic of 
China: Preliminary Results of the 2004-2005 Administrative Review, 71 
FR 35613 (June 21, 2006) (unchanged in final results of review).

Facts Available

    Sections 776(a)(1) and (2) of the Act provide that the Department 
shall apply ``facts otherwise available'' if necessary information is 
not on the record or an interested party or any other person (A) 
withholds information that has been requested, (B) fails to provide 
information within the deadlines established, or in the form and manner 
requested by the Department, subject to subsections (c)(1) and (e) of 
section 782 of the Act, (C) significantly impedes a proceeding, or (D) 
provides information that cannot be verified as provided by section 
782(i) of the Act.
    Where the Department determines that a response to a request for 
information does not comply with the request, section 782(d) of the Act 
provides that the Department will so inform the party submitting the 
response and will, to the extent practicable, provide that party the 
opportunity to remedy or explain the deficiency. If the party fails to 
remedy the deficiency within the applicable time limits and subject to 
section 782(e) of the Act, the Department may disregard all or part of 
the original and subsequent responses, as appropriate. Section 782(e) 
of the Act provides that the Department ``shall not decline to consider 
information that is submitted by an interested party and is necessary 
to the determination but does not meet all applicable requirements 
established by the administering authority'' if the information is 
timely, can be verified, is not so incomplete that it cannot be used, 
and if the interested party acted to the best of its ability in 
providing the information. Where all of these conditions are met, the 
statute requires the Department to use the information if it can do so 
without undue difficulties.
    On March 14, 2007, Myland and Buxin refused to provide information 
requested in the verification agenda, and withdrew from verification. 
Moreover, Myland and Buxin destroyed the verification exhibits and did 
not serve these on the petitioner or the Department. Verification is 
integral to the Department's analysis because it allows the Department 
to satisfy itself that the information upon which the Department relies 
in calculating a margin is accurate and, therefore, enables the 
Department to comply with its mandate to calculate the dumping margin 
as accurately as possible. By refusing the Department's request for 
information in the verification agenda, failing to allow the Department 
to verify the reported data, and not serving the petitioner or 
Department with the verification exhibits taken in Hong Kong, Myland 
and Buxin withheld critical information to be used for the Department's 
separate rate analysis and margin calculation, significantly impeded 
the review, and provided information that cannot be verified, as 
provided by section 782(i) of the Act. Therefore, pursuant to sections 
776(a)(2)(A), (C), and (D) of the Act, the Department must apply facts 
available to Myland and Buxin.
    By failing to respond to the Department's request for information 
contained in the verification agenda and by not allowing the Department 
to conduct verification, Myland and Buxin have not proven they are free 
of government control and are, therefore, not eligible to receive a 
separate rate. For this reason, the Department has denied Myland's and 
Buxin's requests for separate rates. In the Initiation Notice, the 
Department stated that if one of the companies on which we initiated a 
review does not qualify for a separate rate, all other exporters of NMP 
fittings from the PRC who have not qualified for a separate rate are 
deemed to be covered by this review as part of the single PRC-wide 
entity of which the named exporter is a part. See Initiation Notice at 
footnote 2. For these preliminary results, Myland and Buxin will be 
part of the PRC-wide entity, subject to the PRC-wide rate. As a result, 
the Department determines that it is necessary to review the single 
PRC-wide entity, including Myland and Buxin, in this segment of the 
proceeding.
    The PRC-wide entity, including Myland and Buxin, withheld 
information requested in the verification agenda, significantly impeded 
the review, and did not provide verifiable information to the 
Department. Pursuant to sections 776(a)(2)(A), (C), and (D) of the Act, 
the Department must resort to the facts otherwise available with 
respect to the PRC-wide entity.

Adverse Inferences

    Section 776(b) of the Act further provides that the Department may 
use an adverse inference in applying the facts otherwise available when 
a party has failed to cooperate by not acting to the best of its 
ability to comply with a request for information. Adverse inferences 
are appropriate ``to ensure that the party does not obtain a more 
favorable result by failing to cooperate than if it had cooperated 
fully.'' See Statement of Administrative Action (``SAA'') accompanying 
the Uruguay Round Agreements Act (``URAA''), H.R. Rep. No. 103-316, 
Vol. 1 (1994) at 870. Section 776(b) of the Act also authorizes the 
Department to use as adverse facts available (``AFA''), information 
derived from the petition, the final determination, a previous 
administrative review, or other information placed on the record.
    As explained above, the PRC-wide entity, including Myland and 
Buxin, refused to provide the Department with verification information 
and would not permit the Department to verify information placed on the 
record. Therefore, the PRC-wide entity did not cooperate to the best of 
its ability. Because the PRC-wide entity did not cooperate to the best 
of its ability in the proceeding, the Department finds it necessary, 
pursuant to section 776(b) of the Act, to use an adverse inference in 
applying facts available as the basis for these preliminary results of 
review for the PRC-wide entity.
    In this segment of the proceeding, in accordance with Department 
practice (see, e.g., Brake Rotors From the People's Republic of China: 
Rescission of Second New Shipper Review and Final Results and Partial 
Rescission of First Antidumping Duty Administrative Review, 64 FR 
61581, 61584 (November 12, 1999)), as AFA, we have assigned to exports 
of the subject merchandise by the PRC-wide entity (including Myland and 
Buxin) a rate of 75.50 percent, which is the rate established for the 
PRC-wide entity in the less than fair value investigation. See Notice 
of Final Determination of Sales at Less Than

[[Page 20993]]

Fair Value: Non-Malleable Cast Iron Pipe Fittings from the People's 
Republic of China, 68 FR 7765 (February 18, 2003) (``Final 
Determination''). The respondents, Myland and Buxin, consented to the 
assessment of antidumping duties for the period of April 1, 2005 to 
March 31, 2006, at the PRC-wide rate. See Letter from Myland and Buxin 
to the Department, ``Non-Malleable Cast Iron Pipe Fittings from the 
People's Republic of China - Administrative Review,'' dated March 21, 
2007.

Corroboration

    Section 776(c) of the Act provides that, when the Department relies 
on secondary information rather than on information obtained in the 
course of an investigation or review, it shall, to the extent 
practicable, corroborate that information from independent sources that 
are reasonably at its disposal. Secondary information is defined as 
information derived from the petition that gave rise to the 
investigation or review, the final determination concerning the subject 
merchandise, or any previous review under section 751 concerning the 
subject merchandise. See SAA accompanying the URAA at 870. Corroborate 
means that the Department will satisfy itself that the secondary 
information to be 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. The Department, however, need not prove that the selected 
facts available are the best alternative information. See SAA at 869.
    To satisfy itself that the secondary information has probative 
value the Department will, to the extent practicable, examine the 
reliability and relevance of the information used. See Tapered Roller 
Bearings and Parts Thereof, Finished and Unfinished From Japan, and 
Tapered Roller Bearings Four Inches or Less in Outside Diameter, and 
Components Thereof, From Japan; Preliminary Results of Antidumping Duty 
Administrative Reviews and Partial Termination of Administrative 
Reviews, 61 FR 57391, 57392 (November 6, 1996) (unchanged in final 
results of review). Independent sources used to corroborate such 
evidence may include, for example, published price lists, official 
import statistics and customs data, and information obtained from 
interested parties during the particular investigation. See Notice of 
Preliminary Determination of Sales at Less Than Fair Value: High and 
Ultra-High Voltage Ceramic Station Post Insulators from Japan, 68 FR 
35627 (June 16, 2003) (unchanged in final determination); Notice of 
Final Determination of Sales at Less Than Fair Value: Live Swine From 
Canada, 70 FR 12181 (March 11, 2005).
    The reliability of the AFA rate was determined in the final 
determination of the investigation. See Final Determination. The 
Department has received no information to date that warrants revisiting 
the issue of the reliability of the rate calculation itself. See, e.g., 
Certain Preserved Mushrooms From the People's Republic of China: Final 
Results and Partial Rescission of the New Shipper Review and Final 
Results and Partial Rescission of the Third Antidumping Duty 
Administrative Review, 68 FR 41304, 41307-41308 (July 11, 2003). No 
information has been presented in the current review that calls into 
question the reliability of this information. Thus, the Department 
finds that the information contained in the investigation is reliable.
    With respect to the relevance aspect of corroboration, 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 
AFA, 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) (ruling that the Department will not use a margin that 
has been judicially invalidated). Nothing on the record of this review 
calls into question the relevance of the margin selected as AFA. 
Further, the selected margin is currently the PRC-wide rate. Moreover, 
this rate has not been invalidated judicially. Thus, it is appropriate 
to use the selected rate as AFA in the instant review. Therefore, we 
determine that the rate from the Final Determination continues to be 
relevant for use in this administrative review.
    As the recalculated Final Determination rate is both reliable and 
relevant, we determine that it has probative value. As a result, the 
Department determines that the Final Determination rate of 75.50 
percent, which is the highest rate from any segment of this 
administrative proceeding, has probative value and, thus, meets the 
corroboration requirement of section 776(c) of the Act. As noted above, 
Myland and Buxin consented to the assessment of antidumping duties for 
the period of April 1, 2005 to March 31, 2006, at the PRC-wide rate.

Weighted-Average Dumping Margin

    As a result of our review, we preliminarily determine that the 
following margin exists for the period April 1, 2005, through March 31, 
2006:

------------------------------------------------------------------------
    Manufacturer/Exporter              Period           Margin (percent)
------------------------------------------------------------------------
PRC-Wide Entity(including        4/1/2005 - 3/31/2006              75.50
 Myland Industrial Co.,
 Ltd., and Buxin Myland
 (Foundry) Ltd.)............
------------------------------------------------------------------------

Disclosure

    The Department will disclose all documents relied upon in these 
preliminary results to the parties within five 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 of 
these preliminary results. See 19 CFR 351.310(c). Any hearing, if 
requested, will be held two days after the scheduled date for 
submission of rebuttal briefs. See 19 CFR 351.310(d). Interested 
parties may submit case briefs and/or written comments no later than 30 
days after the date of publication of these preliminary results of 
review. See 19 CFR 351.309(c)(ii). Rebuttal briefs and rebuttals to 
written comments, limited to issues raised in such briefs or comments, 
may be filed no later than 35 days after the date of publication. See 
19 CFR 351.309(d). Further, parties submitting written comments should 
provide the Department with an additional copy of those comments on 
diskette. The Department will issue the final results of this 
administrative review, which will include the results of its analysis 
of issues raised in any such

[[Page 20994]]

comments, within 120 days of publication of these preliminary results, 
pursuant to section 751(a)(3)(A) of the Act.

Assessment Rates

    Upon issuance of the final results, the Department will determine, 
and CBP shall assess, antidumping duties on all appropriate entries. 
The Department intends to issue appropriate assessment instructions 
directly to CBP 15 days after the date of publication of the final 
results of this administrative review. If these preliminary results are 
adopted in our final results of review, we will direct CBP to assess 
the resulting rate against the entered customs value for the subject 
merchandise on each importer's/customer's entries during the POR.

Cash-Deposit Requirements

    The following cash-deposit requirements will be effective upon 
publication of the final results of this administrative review for all 
shipments of the subject merchandise 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) the cash deposit 
rate for Myland and Buxin will be the rate listed in the final results 
of review; (2) for previously investigated companies not listed above, 
the cash deposit rate will continue to be the company-specific rate 
published for the most recent period; (3) the cash deposit rate for all 
other PRC exporters will be 75.50 percent; and (4) the cash deposit 
rate for all non-PRC exporters will be the rate applicable to the PRC 
exporter that supplied that exporter. These cash deposit requirements, 
when imposed, shall remain in effect until further notice.

Notification to Importers

    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f) (2) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    We are issuing and publishing these preliminary results of review 
in accordance with sections 751(a)(1) and 777(i)(1) of the Act, and 19 
CFR 351.221(b).

    Dated: April 23, 2007.
David M. Spooner,
Assistant Secretary for Import Administration.
[FR Doc. E7-8121 Filed 4-26-07; 8:45 am]
BILLING CODE 3510-DS-S