Federal Register, Volume 74 Issue 17 (Wednesday, January 28, 2009)

[Federal Register Volume 74, Number 17 (Wednesday, January 28, 2009)]
[Notices]
[Pages 4929-4936]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-1721]

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DEPARTMENT OF COMMERCE

International Trade Administration

(A-570-939)

Certain Tow Behind Lawn Groomers and Certain Parts Thereof from
the People's Republic of China: Preliminary Determination of Sales at
Less Than Fair Value and Postponement of Final Determination

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

EFFECTIVE DATE: January 28, 2009.
SUMMARY: The Department of Commerce (the ``Department'') preliminarily
determines that certain tow behind lawn groomers and certain parts
thereof (``lawn groomers'') 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(b) of the
Tariff Act of 1930, as amended (the ``Act''). The estimated dumping
margins are shown in the ``Preliminary Determination Margins'' section
of this notice.

FOR FURTHER INFORMATION CONTACT: Karine Gziryan or Thomas Martin, AD/
CVD Operations, Office 4, Import Administration, International Trade
Administration, U.S. Department of Commerce, 14th Street and
Constitution Avenue, NW, Washington, DC 20230; telephone: (202) 482-
4081or (202) 482-3936, respectively.

SUPPLEMENTARY INFORMATION:

Background

On June 24, 2008, the Department received a petition concerning
imports of certain non-motorized tow behind lawn groomers and certain
parts thereof from the PRC filed in proper form by Agri-Fab Inc.
(``Agri-Fab'', hereafter referred to as ``Petitioner''). See Petition
for the Imposition of Antidumping Duties: Certain Tow Behind Lawn
Groomers and Parts Thereof from the People's Republic of China, dated
June 24, 2008 (``Petition''). The Department initiated an antidumping
duty investigation of lawn groomers from the PRC on July 21, 2008. See
Certain Tow Behind Lawn Groomers and Certain Parts Thereof from the
People's Republic of China: Initiation of Antidumping Duty
Investigation, 73 FR 42315 (July 21, 2008) (``Initiation Notice'').
On July 14, 2008, the Department requested quantity and value
(``Q&V'') information from the twelve companies that were identified in
the Petition as potential producers or exporters of lawn groomers from
the PRC. See Exhibit I-19 of the Petition. The Department received
timely responses to its Q&V questionnaire from the following companies:
Qingdao Huatian Hand Truck Co., Ltd., Jiashan Superpower Tools Co.,
Ltd., T.N. International, Inc., Nantong Duobang Machinery Co., Ltd.,
and Princeway Furniture (Dong Guan) Co., Ltd. Five companies to which
the Department sent the Q&V questionnaire received the questionnaire
but did not respond. These non-responsive companies were: Hangzhou
Geesun International Co., Ltd., Qingdao Huandai Tools Co., Ltd.,
Qingdao Taifa Group Co., Ltd., Maxchief Investments Ltd., and Qingdao
EA Huabang Instrument Co., Ltd.
With regard to two additional companies, World Factory, Inc., and
Sidepin, Ltd., on July 21, 2008, we spoke with Federal Express, via
telephone, and were informed that, although World Factory, Inc.,
originally accepted delivery of the Q&V questionnaire, it ultimately
rejected our mailing and returned the package to Federal Express. In
addition, on July 21, 2008, we spoke via telephone with DHL and were
informed that DHL was unable to deliver our mailing to Sidepin, Ltd.,
due to a ``bad address.''\1\ See Memorandum to The File, from Maisha
Cryor, Senior Import Compliance Specialist, Regarding ``Certain Tow
Behind Lawn Groomers and Certain Parts Thereof from the People's
Republic of China: Summary of Issuance of Quantity and Value
Questionnaires,'' dated July 21, 2008.
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\1\ The petitioner provided contact information for the twelve
Chinese producers/exporters of lawn groomers named in the Petition.
See Petition at Exhibit I-19. However, upon noticing that several of
the addresses provided were incomplete, the Department asked the
petitioner to update the aforementioned contact information to
account for full addresses, e.g., contact name, postal code, street
names and numbers, etc. See the Department's July 3, 2008,
supplemental questionnaire at 3. In response, the petitioner
provided updated contact information, but noted that this
information represented its ``best attempt using reasonably
available information to update the Chinese manufacturer and
exporter contact information.'' See Supplement to the Petition at 2
and Exhibit 2, dated July 8, 2008.
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On August 21, 2008, the International Trade Commission (``ITC'')
preliminarily determined that there is a reasonable indication that an
industry in the United States is materially injured by reason of
imports of lawn groomers from the PRC. See CertainTow-Behind Lawn
Groomers and Certain Parts Thereof from China Determinations
Investigation Nos. 701-TA-457 and 731-TA-1153 (Preliminary), 73 FR
49489 (August 21, 2008).
On August 18, 2008, the Department selected Jiashan Superpower
Tools Co., Ltd. (``Superpower''), and Princeway Furniture (Dong Guan)
Co., Ltd. (``Princeway''), as mandatory respondents and issued
antidumping duty questionnaires to the companies. See Memorandum
regarding ``Selection of Respondents for the Antidumping Duty
Investigation of Certain Tow Behind Lawn Groomers and Parts Thereof
from the People's Republic of China,'' dated August 18, 2008
(``Respondent Selection Memorandum'').
Superpower and Princeway submitted timely responses to the
Department's antidumping duty questionnaire on September 24, 2008, and
October 14, 2008, respectively. On July 23, 2008, and July 30, 2008,
the Department received separate-rate applications from Nantong D&B
Machinery Co., Ltd., and Qingdao Huatian Truck Co., Ltd., respectively.
The Department issued supplemental questionnaires to, and received
responses from, Superpower and Princeway from September through
December 2008. Petitioner submitted comments to the Department
regarding Princeway's and Superpower's responses to sections C and D of
the antidumping duty questionnaire on October 24, 2008 and additional
comments on Princeway's submissions on December 2, 2008.
On September 30, 2008, the Department released a memorandum to
interested parties which listed potential surrogate countries and
invited interested parties to comment on surrogate country and
surrogate value selection. See Memorandum to All Interested Parties
Regarding Antidumping Duty Investigation of Certain Tow Behind Lawn
Groomers and Certain Parts Thereof from the People's Republic of China
(``PRC''). On October 17, 2008, and October 28, 2008, Petitioner and
Princeway submitted comments and rebuttal comments,

[[Page 4930]]

respectively, on the appropriate surrogate country and surrogate
values.
On November 5, 2008, the Petitioner made a request for a 50-day
postponement of the preliminary determination. On November 17, 2008,
the Department extended this preliminary determination by fifty days.
See Certain Tow Behind Lawn Groomers and Certain Parts Thereof from the
People's Republic of China: Postponement of Preliminary Determination
of Antidumping Duty Investigation, 73 FR 67836 (November 17, 2008).

Period of Investigation

The period of investigation (``POI'') is October 1, 2007, through
March 31, 2008. This period corresponds to the two most recent fiscal
quarters prior to the month of the filing of the petition, i.e., June
2008. See 19 CFR 351.204(b)(1).

Scope of the Investigation

The scope of this investigation covers certain non-motorized tow
behind lawn groomers (``lawn groomers''), manufactured from any
material, and certain parts thereof. Lawn groomers are defined as lawn
sweepers, aerators, dethatchers, and spreaders. Unless specifically
excluded, lawn groomers that are designed to perform at least one of
the functions listed above are included in the scope of these
investigations, even if the lawn groomer is designed to perform
additional non-subject functions (e.g., mowing).
All lawn groomers are designed to incorporate a hitch, of any
configuration, which allows the product to be towed behind a vehicle.
Lawn groomers that are designed to incorporate both a hitch and a push
handle, of any type, are also covered by the scope of these
investigations. The hitch and handle may be permanently attached or
removable, and they may be attached on opposite sides or on the same
side of the lawn groomer. Lawn groomers designed to incorporate a
hitch, but where the hitch is not attached to the lawn groomer, are
also included in the scope of the investigations.
Lawn sweepers consist of a frame, as well as a series of brushes
attached to an axle or shaft which allows the brushing component to
rotate. Lawn sweepers also include a container (which is a receptacle
into which debris swept from the lawn or turf is deposited) supported
by the frame. Aerators consist of a frame, as well as an aerating
component that is attached to an axle or shaft which allows the
aerating component to rotate. The aerating component is made up of a
set of knives fixed to a plate (known as a ``plug aerator''), a series
of discs with protruding spikes (a ``spike aerator''), or any other
configuration, that are designed to create holes or cavities in a lawn
or turf surface. Dethatchers consist of a frame, as well as a series of
tines designed to remove material (e.g., dead grass or leaves) or other
debris from the lawn or turf. The dethatcher tines are attached to and
suspended from the frame. Lawn spreaders consist of a frame, as well as
a hopper (i.e., a container of any size, shape, or material) that holds
a media to be spread on the lawn or turf. The media can be distributed
by means of a rotating spreader plate that broadcasts the media
(``broadcast spreader''), a rotating agitator that allows the media to
be released at a consistent rate (``drop spreader''), or any other
configuration.
Lawn dethatchers with a net fully-assembled weight (i.e., without
packing, additional weights, or accessories) of 100 pounds or less are
covered by the scope of the investigations. Other lawn groomers-
sweepers, aerators, and spreaders-with a net fully-assembled weight
(i.e., without packing, additional weights, or accessories) of 200
pounds or less are covered by the scope of the investigations.
Also included in the scope of the investigations are modular units,
consisting of a chassis that is designed to incorporate a hitch, where
the hitch may or may not be included, which allows modules that perform
sweeping, aerating, dethatching, or spreading operations to be
interchanged. Modular units-when imported with one or more lawn
grooming modules-with a fully assembled net weight (i.e., without
packing, additional weights, or accessories) of 200 pounds or less when
including a single module, are included in the scope of the
investigations. Modular unit chasses, imported without a lawn grooming
module and with a fully assembled net weight (i.e., without packing,
additional weights, or accessories) of 125 pounds or less, are also
covered by the scope of the investigations. When imported separately,
modules that are designed to perform subject lawn grooming functions
(i.e., sweeping, aerating, dethatching, or spreading), with a fully
assembled net weight (i.e., without packing, additional weights, or
accessories) of 75 pounds or less, and that are imported with or
without a hitch, are also covered by the scope.
Lawn groomers, assembled or unassembled, are covered by these
investigations. For purposes of these investigations, ``unassembled
lawn groomers'' consist of either 1) all parts necessary to make a
fully assembled lawn groomer, or 2) any combination of parts,
constituting a less than complete, unassembled lawn groomer, with a
minimum of two of the following ``major components'':
1) an assembled or unassembled brush housing designed to be used in
a lawn sweeper, where a brush housing is defined as a component housing
the brush assembly, and consisting of a wrapper which covers the brush
assembly and two end plates attached to the wrapper;
2) a sweeper brush;
3) an aerator or dethatcher weight tray, or similar component
designed to allow weights of any sort to be added to the unit;
4) a spreader hopper;
5) a rotating spreader plate or agitator, or other component
designed for distributing media in a lawn spreader;
6) dethatcher tines;
7) aerator spikes, plugs, or other aerating component; or
8) a hitch.
The major components or parts of lawn groomers that are
individually covered by these investigations under the term ``certain
parts thereof'' are: (1) brush housings, where the wrapper and end
plates incorporating the brush assembly may be individual pieces or a
single piece; and (2) weight trays, or similar components designed to
allow weights of any sort to be added to a dethatcher or an aerator
unit.
The products for which relief is sought specifically exclude the
following: 1) agricultural implements designed to work (e.g., churn,
burrow, till, etc.) soil, such as cultivators, harrows, and plows; 2)
lawn or farm carts and wagons that do not groom lawns; 3) grooming
products incorporating a motor or an engine for the purpose of
operating and/or propelling the lawn groomer; 4) lawn groomers that are
designed to be hand held or are designed to be attached directly to the
frame of a vehicle, rather than towed; 5) ``push'' lawn grooming
products that incorporate a push handle rather than a hitch, and which
are designed solely to be manually operated; 6) dethatchers with a net
assembled weight (i.e., without packing, additional weights, or
accessories) of more than 100 pounds, or lawn groomers-sweepers,
aerators, and spreaders-with a net fully-assembled weight (i.e.,
without packing, additional weights, or accessories) of more than 200
pounds; and 7) lawn rollers designed to flatten grass and turf,
including lawn rollers which

[[Page 4931]]

incorporate an aerator component (e.g., ``drum-style'' spike aerators).
The lawn groomers that are the subject of these investigations are
currently classifiable in the Harmonized Tariff Schedule of the United
States (``HTSUS'') statistical reporting numbers 8432.40.0000,
8432.80.0000, 8432.80.0010, 8432.90.0030, 8432.90.0080, 8479.89.9896,
8479.89.9897, 8479.90.9496, and 9603.50.0000. These HTSUS provisions
are given for reference and customs purposes only, and the description
of merchandise is dispositive for determining the scope of the product
included in these investigations.

Scope Comments

In accordance with the preamble to the Department's regulations, we
set aside a period of time in our Initiation Notice for parties to
raise issues regarding product coverage, and encouraged all parties to
submit comments within 21 calendar days of issuance of that notice. See
Antidumping Duties; Countervailing Duties, 62 FR 27296, 27323 (May 19,
1997) and Initiation Notice, 73 FR at 42316. On December 30, 2008,
Brinly-Hardy Company (``Brinly-Hardy''), a domestic producer of the
subject merchandise, submitted comments on the scope of the
investigation. We have given all interested parties an opportunity to
submit comments. See Memorandum from Thomas Martin, International Trade
Compliance Analyst, to file, ``Deadline for Comments on Brinly-Hardy
Company's December 30, 2008 Submission: Antidumping Duty Investigation
of Certain Tow Behind Lawn Groomers from the People's Republic of
China,'' dated January 5, 2009. We will evaluate the comments for the
final results.

Non-Market Economy Treatment

The Department considers the PRC to be a non-market economy
(``NME'') country. In accordance with section 771(18)(C)(i) of the Act,
any determination that a country is an NME country shall remain in
effect until revoked by the administering authority. See, e.g., Tapered
Roller Bearings and Parts Thereof (TRBs), 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 TRBs, Finished and Unfinished, from
the People's Republic of China: Final Results of 2001-2002
Administrative Review and Partial Rescission of Review, 68 FR 70488
(December 18, 2003). The Department has not revoked the PRC's status as
an NME country. Therefore, in this preliminary determination, we have
treated the PRC as an NME country and applied our current NME
methodology.

Selection of a Surrogate Country

In antidumping proceedings involving NME countries, where the
available information does not allow the Department to determine normal
value (``NV'') pursuant to section 773(a) of the Act, the Department
will base NV on the value of the NME producer's factors of production.
See section 773(c)(1) of the Act. In accordance with section 773(c)(4)
of the Act, in valuing the factors of production, the Department shall
utilize, 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 merchandise comparable to the subject
merchandise. The Department has determined that India, Indonesia, the
Philippines, Colombia, and Thailand are countries that are at a level
of economic development comparable to that of the PRC. See Memorandum
regarding Request for a List of Surrogate Countries for the Antidumping
Duty Investigation of Tow-Behind Lawn Groomers (``TBLG'') from the
People's Republic of China (``PRC'')'' dated September 30, 2008
(``Policy Memorandum'').
As noted above, in October 2008, Petitioner and Princeway submitted
comments on the appropriate surrogate country. In their comments, each
party stated that India satisfies the statutory criteria for surrogate
country selection because it is at a comparable level of economic
development with the PRC and it is a significant producer of comparable
merchandise that is sufficiently similar to the subject merchandise.
However, since India does not produce or export lawn groomers,
Petitioner and Princeway disagreed on the definition of what
constitutes comparable merchandise. In its comments, Petitioner claimed
that hand trucks represent the most comparable merchandise to lawn
groomers. Princeway, in its comments, argued that agricultural
implements should be used as comparable merchandise.
After evaluating interested parties' comments, the Department
selected India as the surrogate country for this investigation and
decided that because the lawn groomers and hand trucks industries use
many of the same raw material inputs and similar production processes,
hand trucks constitute comparable merchandise. For further discussion,
see Memorandum from Zhulieta Willbrand, International Trade Compliance
Analyst, to Abdelali Elouaradia, Office Director, ``Antidumping Duty
Investigation of Certain Tow Behind Lawn Groomers and Certain Parts
Thereof from the People's Republic of China: Selection of a Surrogate
Country,'' dated January 21, 2009. In sum, the Department determined
that: 1) India is at a level of economic development comparable to that
of the PRC; and 2) India is a significant producer of merchandise
comparable to the subject merchandise. Upon the publication of the
preliminary results, the Department notes that interested parties may
submit additional information on comparable merchandise within the
confines of the new factual information submission deadlines. See 19
CFR 351.301(b)(1).

Separate Rates

In the Initiation Notice, the Department notified parties of the
application process by which exporters and producers may obtain
separate-rate status in NME investigations. See Initiation Notice, 73
FR at 42318-19. The process requires exporters and producers to submit
a separate-rate status application. See Policy Bulletin 05.1: Separate-
Rates Practice and Application of Combination Rates in Antidumping
Investigations involving Non-Market Economy Countries, (April 5, 2005)
(``Policy Bulletin 05.1''), available at http://ia.ita.doc.gov/policy/bull05-1.pdf. However, the standard for eligibility for a separate
rate, which is whether a firm can demonstrate an absence of both de
jure and de facto governmental control over its export activities, has
not changed.
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 rate. It is the Department's practice 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.
Exporters can demonstrate this independence through the absence of both
de jure and de facto governmental control over export activities. The
Department analyzes each entity exporting the subject merchandise under
a test arising from 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 further developed in Notice of Final

[[Page 4932]]

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-rate 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.
Two separate rate applicants, Qingdao Huatian Truck Co., Ltd.
(``Huatian''), and Nantong D & B Machinery Co., Ltd. (``Nantong''), and
one mandatory respondent, Superpower, stated that they are partially
Chinese-owned companies. Therefore, the Department must analyze whether
the mandatory respondent and separate rate applicants can demonstrate
the absence of both de jure and de facto governmental control over
export activities. Each company provided company-specific information
to demonstrate that it operates free from de jure and de facto
government control, and therefore, is entitled to a separate rate.
An additional mandatory respondent, Princeway, provided company-
specific separate-rate information and stated that the standards for
the assignment of separate rates have been met because it is a
privately-owned company incorporated in the British Virgin Islands and
based in Hong Kong. See Princeway's ``Separate Rate Application,''
dated September 19, 2008, and ``Separate Rate Application Supplemental
Response Questionnaire,'' dated October 21, 2008. Because Princeway is
foreign owned, it is not necessary to undertake additional separate-
rates analysis for the Department to determine that the export
activities of Princeway are independent from the PRC government's
control. Accordingly, Princeway is eligible for a separate rate. See,
e.g., Brake Rotors From the People's Republic of China: Final Results
of the Tenth New Shipper Review, 69 FR 52228 (August 25, 2004).

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) other formal
measures by the government decentralizing control of companies. See
Sparklers, 56 FR at 20589.
The evidence provided by Huatian, Nantong and Superpower indicates
that there are no restrictive stipulations associated with their export
and/or business licenses and that there are legislative enactments
decentralizing control of the companies. The Department's analysis of
the record evidence supports a preliminary finding of absence of de
jure control. See ``Response to the Separate Rate Application'', dated
September 4, 2008, ``Response to the Separate Rate Application
Supplemental Questionnaire,'' dated September 27, 2008, and ``Response
to the Separate Rate Application Supplemental Questionnaire dated
October 7, 2008,'' dated October 15, 2008, from Nantong (``Nantong's
SRA''). See also ``Huatian's Separate Rate Application,'' dated
September 29, 2008, ``Response to the Separate Rate Application
Supplemental Questionnaire,'' dated October 9, 2008, and ``Response to
the Separate Rate Application Supplemental Questionnaire,'' dated
November 4, 2008 (``Huatian's SRA''). For Superpower, see ``Response to
the Separate Rate Application,'' dated September 24, 2008, and
``Response to the Separate Rate Application Supplemental
Questionnaire,'' dated October 23, 2008 (``Superpower's SRA'').

Absence of De Facto Control

Typically the Department 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). 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.
In this case, we determine that the evidence on the record supports
a preliminary finding of de facto absence of governmental control with
respect to Huatian, Nantong and Superpower based on record statements
and supporting documentation showing that the companies: (1) set their
own export prices independent of the government and without the
approval of a government authority; (2) retain their proceeds from
sales and make independent decisions regarding disposition of profits
or financing of losses; (3) have the authority to negotiate and sign
contracts and other agreements; and (4) have autonomy from the
government regarding the selection of management. See Nantong's SRA,
Huatian's SRA and Superpower's SRA.
The evidence placed on the record of this investigation by Huatian,
Nantong and Superpower demonstrates an absence of de jure and de facto
government control with respect to these exporters' sales of the
merchandise under investigation, in accordance with the criteria
identified in Sparklers and Silicon Carbide. Therefore, we have
preliminarily granted a separate rate to all three exporters. The
Department has calculated company-specific dumping margins for the two
mandatory respondents, Superpower and Princeway, and assigned to
Huation and Nantong, a dumping margin equal to a simple average of the
dumping margins calculated for the two mandatory respondents.
Additionally, we note that while we received the Q&V information
from T.N. International, Inc., one of the five companies which
responded to the Q&V questionnaire, the company was not selected by the
Department as a mandatory respondent. As indicated in the Initiation
Notice, where T.N. International, Inc., had an opportunity to request a
separate rate, it failed to do so. Consequently and according to our
practice, we assigned to T.N. International, Inc., preliminarily the
PRC-wide rate.

The PRC-Wide Entity

Although PRC exporters of subject merchandise to the United States
were given an opportunity to provide Q&V information to the Department,
not all exporters responded to the Department's request for Q&V
information.\2\ Based upon our knowledge of the volume of imports of
subject merchandise from the PRC, we have concluded that the companies
that responded to the Q&V questionnaire do not account for all U.S.
imports of subject merchandise from the PRC made during the POI.\3\ We
have

[[Page 4933]]

treated the non-responsive PRC producers/exporters as part of the PRC-
wide entity because they have not demonstrated their eligibility for a
separate rate.
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\2\ The Department received only five timely responses to the
requests for Q&V information that it sent to twelve potential
exporters identified in the Petition.
\3\ See Respondent Selection Memorandum.
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Section 776(a)(2) of the Act provides that the Department shall,
subject to subsection 782(d) of the Act, use facts otherwise available
in reaching the applicable determination if an interested party: (A)
withholds information that has been requested by the Department; (B)
fails to provide such information in a timely manner or in the form or
manner requested, subject to subsections 782(c)(1) and (e) of the Act;
(C) significantly impedes a proceeding under the antidumping statute;
or (D) provides such information but the information cannot be
verified.
As noted above, the PRC-wide entity withheld information requested
by the Department. As a result, pursuant to section 776(a)(2)(A) of the
Act, we find it appropriate to base the PRC-wide dumping margin on
facts available. See, e.g., Notice of Preliminary Determination of
Sales at Less Than Fair Value, Affirmative Preliminary Determination of
Critical Circumstances and Postponement of Final Determination: Certain
Frozen Fish Fillets From the Socialist Republic of Vietnam, 68 FR 4986,
4991-92 (January 31, 2003), unchanged in Notice of Final Antidumping
Duty Determination of Sales at Less Than Fair Value and Affirmative
Critical Circumstances: Certain Frozen Fish Fillets from the Socialist
Republic of Vietnam, 68 FR 37116 (June 23, 2003).
Section 776(b) of the Act provides that, in selecting from among
the facts otherwise available, the Department may employ an adverse
inference if an interested party fails to cooperate by not acting to
the best of its ability to comply with requests for information. See,
e.g., Notice of Final Determination of Sales at Less Than Fair Value:
Certain Cold-Rolled Flat-Rolled Carbon-Quality Steel Products From the
Russian Federation, 65 FR 5510, 5518 (February 4, 2000); see also
Statement of Administrative Action, accompanying the Uruguay Round
Agreements Act , H.R. Rep. No. 103-316, Vol. I at 843 (1994) (``SAA''),
reprinted in 1994 U.S.C.C.A.N. 4040 at 870. Because the PRC-wide entity
did not respond to the Department's request for information, the
Department has concluded that the PRC-wide entity has failed to
cooperate to the best of its ability. Therefore, the Department
preliminarily finds that, in selecting from among the facts available,
an adverse inference is appropriate.
Section 776(b) of the Act authorizes the Department to use, as
adverse facts available (``AFA''): (1) information derived from the
petition; (2) the final determination from the LTFV investigation; (3)
a previous administrative review; or (4) any other information placed
on the record. In selecting a rate for AFA, the Department selects one
that is sufficiently adverse ``as to effectuate the statutory purposes
of the adverse facts available rule to induce respondents to provide
the Department with complete and accurate information in a timely
manner.'' See Notice of Final Determination of Sales at Less Than Fair
Value: Static Random Access Memory Semiconductors From Taiwan, 63 FR
8909, 8932 (February 23, 1998). It is the Department's practice to
select, as AFA, the higher of: (a) the highest margin alleged in the
petition, or (b) the highest calculated rate for any respondent in the
investigation. See Final Determination of Sales at Less Than Fair
Value: Certain Cold-Rolled Flat-Rolled Carbon Quality Steel Products
From the People's Republic of China, 65 FR 34660 (May 31, 2000), and
accompanying Issues and Decisions Memorandum at ``Facts Available.''
Here, we assigned the PRC-wide entity the dumping margin calculated for
Superpower, which exceeds the highest margin alleged in the petition
and is the highest rate calculated in this investigation. Pursuant to
section 776(c) of the Act, we do not need to corroborate this rate
because it is based on information obtained during the course of this
investigation rather than secondary information. See also SAA at 870.
The PRC-wide dumping margin applies to all entries of the merchandise
under investigation except for entries of subject merchandise from
Superpower,\4\ Princeway, Nandong and Huatian.
---------------------------------------------------------------------------

\4\ Because the Department based the PRC-wide dumping margin on
Superpower's dumping rate, both rates are equal. However, Superpower
has its own separate rate and is not part of the PRC-wide entity.
---------------------------------------------------------------------------

Fair Value Comparisons

To determine whether Princeway and Superpower sold lawn groomers to
the United States at LTFV, we compared the weighted-average export
price (``EP'') of the lawn groomers to the NV of the lawn groomers, as
described in the ``U.S. Price,'' and ``Normal Value'' sections of this
notice.

U.S. Price

In accordance with section 772(a) of the Act, for both Superpower
and Princeway, we based the U.S. price of sales on EP because the first
sale to unaffiliated purchasers was made prior to importation and the
use of constructed export price was not otherwise warranted. In
accordance with section 772(c) of the Act, we calculated EP for
Superpower and Princeway by deducting the following expenses from the
starting price (gross unit price) charged to the first unaffiliated
customer in the United States: foreign movement expenses and foreign
brokerage and handling expenses.
We based these movement expenses on surrogate values where the
service was purchased from a PRC company. For details regarding our EP
calculation, see Analysis Memoranda for Superpower and Princeway, dated
January 21, 2009.

Normal Value

In accordance with section 773(c) of the Act, we constructed NV
from the factors of production employed by Princeway and Superpower to
manufacture subject merchandise during the POI. Specifically, we
calculated NV by adding together the value of the factors of
production, general expenses, profit, and packing costs, as well as an
adjustment for the byproduct. We valued the factors of production using
prices and financial statements from India, the surrogate country
selected for this investigation or where appropriate, the prices paid
for the input, in accordance with 19 CFR 351.408(c)(1).\5\ In selecting
surrogate values, we followed, to the extent practicable, the
Department's practice of choosing values which are non-export average
values, product-specific, tax-exclusive, and contemporaneous with, or
closest in time to, the POI. See, e.g., Notice of Preliminary
Determination of Sales at Less Than Fair Value, Negative Preliminary
Determination of Critical Circumstances and Postponement of Final
Determination: Certain Frozen and Canned Warmwater Shrimp From the
Socialist Republic of Vietnam, 69 FR 42672, 42682 (July 16, 2004),
unchanged in Final Determination of Sales at Less Than Fair Value:
Certain Frozen and Canned Warmwater Shrimp from the Socialist Republic
of Vietnam, 69 FR 71005 (December 8, 2004). We also considered the
quality of the source of surrogate information in selecting surrogate
values.
---------------------------------------------------------------------------

\5\ Superpower reported that it purchased no factors of
production from market economy suppliers during the POI. See
Superpower's October 14, 2008, Section D Response at D-5. Princeway
purchased certain factors of production from market economy
suppliers. See Princeway's October 10, 2008, Section D Response at 8
---------------------------------------------------------------------------

We valued material inputs and packing materials by multiplying the
amount of the factor consumed in producing subject merchandise by the

[[Page 4934]]

average unit value of the factor. In addition, we added freight costs
to the surrogate costs that we calculated for material inputs. We
calculated freight costs by multiplying surrogate freight rates by the
shorter of the reported distance from the domestic supplier to the
factory that produced the subject merchandise or the distance from the
nearest seaport to the factory that produced the subject merchandise,
as appropriate. 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, 1407 (Fed. Cir. 1997). Where we could only
obtain surrogate values that were not contemporaneous with the POI, we
inflated (or deflated) the surrogate values using the Wholesale Price
Index (``WPI'').
Further, in calculating surrogate values from Indian imports, we
disregarded imports from Indonesia, South Korea and Thailand because in
other proceedings the Department found that these countries maintain
broadly available, non-industry-specific export subsidies. Therefore,
it is reasonable to infer that all exports to all markets from these
countries may be subsidized. See Final Determination of Sales at Less
Than Fair Value: Certain Automotive Replacement Glass Windshields from
the People's Republic of China, 67 FR 6482 (February 12, 2002), and
accompanying Issues and Decision Memorandum at Comment 1; see also
Notice of Final Determination of Sales at Less Than Fair Value and
Negative Final Determination of Critical Circumstances: Certain Color
Television Receivers From the People's Republic of China, 69 FR 20594
(April 16, 2004), and accompanying Issues and Decision Memorandum at
Comment 7.\6\ Thus, we have not used prices from these countries in
calculating the Indian import-based surrogate values.
---------------------------------------------------------------------------

\6\ In addition, as explained in the legislative history, it is
the Department's practice not to conduct a formal investigation to
ensure that such prices are not subsidized. See Omnibus Trade and
Competitiveness Act of 1988, Conference Report to Accompanying H.R.
Rep. 100-576 at 590 (1988). As such, it is the Department's practice
to base its decision on information that is available to it at the
time it makes its determination.
---------------------------------------------------------------------------

We valued raw materials and packing materials obtained from non-
market economy suppliers using Indian import statistics. See Surrogate
Value Memorandum. We valued water using data from the Maharashtra
Industrial Development Corporation \7\ because that data include a wide
range of industrial water tariffs. This source provides 344 industrial
water rates within the Maharashtra province from June 2003: 172 for the
``inside industrial areas'' usage category, and 172 for the ``outside
industrial areas'' usage category. See Surrogate Value Memorandum.
---------------------------------------------------------------------------

\7\ Website available at http://www.midcindia.org.
---------------------------------------------------------------------------

We valued electricity using price data for small, medium, and large
industries, as published by the Central Electricity Authority of the
Government of India in its publication titled Electricity Tariff & Duty
and Average Rates of Electricity Supply in India, dated July 2006.
These electricity rates represent actual country-wide, publicly-
available information on tax-exclusive electricity rates charged to
industries in India. Since the rates are not contemporaneous with the
POI, we inflated the values using the WPI. See Surrogate Value
Memorandum.
For direct labor, indirect labor, and packing labor, consistent
with 19 CFR 351.408(c)(3), we used the most recently calculated
regression-based wage rate, which relies on 2005 data. This wage rate
can be found on the Import Administration's home page. See ``Expected
Wages of Selected NME Countries,'' available at http://ia.ita.doc.gov/wages/index.html (revised May 2008). The source of these wage rate data
on the Import Administration's web site is the International Labour
Organization, Geneva, Labour Statistics Database Chapter 5B: Wages in
Manufacturing. Since this regression-based wage rate does not separate
the labor rates into different skill levels or types of labor, we have
applied the same wage rate to all skill levels and types of labor
reported by Princeway and Superpower. See Surrogate Value Memorandum.
As noted above, we valued inland truck freight expenses using a
deflated per-unit average rate calculated from data on the following
web site: http://www.infobanc.com/logistics/logtruck.htm. See Surrogate
Value Memorandum. The logistics section of this website contains inland
freight truck rates between many large Indian cities. Since this value
is not contemporaneous with the POI, we deflated the rate using WPI
data.
We valued brokerage and handling using a simple average of the
brokerage and handling costs that were reported in public submissions
that were filed in three antidumping duty cases. Specifically, we
averaged the public brokerage and handling expenses reported by: (1)
Agro Dutch Industries Ltd. in the antidumping duty administrative
review of certain preserved mushrooms from India, (2) Kejirwal Paper
Ltd. in the less than fair value investigation of certain lined paper
products from India, and (3) Essar Steel in the antidumping duty
administrative review of hot-rolled carbon steel flat products from
India.\8\ See Certain Preserved Mushrooms From India: Final Results of
Antidumping Duty Administrative Review, 71 FR 10646 (March 2, 2006);
Notice of Preliminary Determination of Sales at Less Than Fair Value,
Postponement of Final Determination, and Affirmative Preliminary
Determination of Critical Circumstances in Part: Certain Lined Paper
Products From India, 71 FR 19706 (April 17, 2006), unchanged in Notice
of Final Determination of Sales at Less Than Fair Value, and Negative
Determination of Critical Circumstances: Certain Lined Paper Products
from India, 71 FR 45012 (August 8, 2006); and Certain Hot-Rolled Carbon
Steel Flat Products From India: Preliminary Results of Antidumping Duty
Administrative Review, 71 FR 2018, 2021 (January 12, 2006), unchanged
in Certain Hot-Rolled Carbon Steel Flat Products From India: Final
Results of Antidumping Administrative Review, 71 FR 40694 (July 18,
2006). We inflated the brokerage and handling rate using the
appropriate WPI inflator. See Surrogate Value Memorandum.
---------------------------------------------------------------------------

\8\ Use of these averages is consistent with the Department's
normal practice to calculate brokerage and handling expenses. Absent
product-specific data, the Department's preference is to average
these data sources because they represent values for numerous
transactions that are available for a range of products and minimize
the potential distortions that might arise from a single price
source. One value, taken in isolation, could differ significantly
when compared across a range of products, values, and special
circumstances of a single transaction. See Final Determination of
Sales at Less Than Fair Value and Partial Affirmative Determination
of Critical Circumstances: Certain Polyester Staple Fiber from the
People's Republic of China, 72 FR 19690 (April 19, 2007), and
accompanying Issues and Decision Memorandum at Comment 5.
---------------------------------------------------------------------------

We valued factory overhead, selling, general, and administrative
(``SG&A'') expenses, and profit, using the financial ratios calculated
from the 2006-2007 audited financial statement of one Indian producer
of hand trucks: Godrej & Boyce Manufacturing Company Limited. See
Surrogate Value Memorandum.
In accordance with 19 CFR 351.301(c)(3)(i), interested parties may
submit publicly available information with which to value factors of
production in the final determination within 40 days after the date of
publication of the preliminary determination.

Currency Conversion

We made currency conversions into U.S. dollars, in accordance with
section 773A(a) of the Act, based on the

[[Page 4935]]

exchange rates in effect on the dates of the U.S. sales as certified by
the Federal Reserve Bank.

Verification

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

Combination Rates

In the Initiation Notice, the Department stated that it would
calculate combination rates for respondents that are eligible for a
separate rate in this investigation. See Initiation Notice, 73 FR at
42319. This change in practice is described in Policy Bulletin 05.1,
which states:
{W{time} hile continuing the practice of assigning separate rates
only to exporters, all separate rates that the Department will now
assign in its NME investigations will be specific to those producers
that supplied the exporter during the period of investigation. Note,
however, that one rate is calculated for the exporter and all of the
producers which supplied subject merchandise to it during the period of
investigation. This practice applies both to mandatory respondents
receiving an individually calculated separate rate as well as the pool
of non-investigated firms receiving the weighted-average of the
individually calculated rates. This practice is referred to as the
application of ``combination rates'' because such rates apply to
specific combinations of exporters and one or more producers. The cash-
deposit rate assigned to an exporter will apply only to merchandise
both exported by the firm in question and produced by a firm that
supplied the exporter during the period of investigation.
See Policy Bulletin 05.1 at 6.

Preliminary Determination Margins

The Department has determined that the following weighted-average
dumping margins exist for the POI:

------------------------------------------------------------------------
Weighted-
Manufacturer/Exporter Average Margin
(Percent)
------------------------------------------------------------------------
Jiashan Superpower Tools Co., Ltd.\9\.................. 324.43
Princeway Furniture (Dong Guan) Co., Ltd.\10\.......... 12.07
Nantong D & B Machinery Co., Ltd.\11\.................. 168.25
Qingdao Huatian Truck Co., Ltd.\12\.................... 168.25
PRC-wide Entity........................................ 324.43
------------------------------------------------------------------------
\9\ Jiashan Superpower Tools Co., Ltd., manufactures and exports subject
merchandise.
\10\ Princeway Furniture (Dong Guan) Co., Ltd., manufactures and exports
subject merchandise.
\11\ Nantong D & B Machinery Co., Ltd., manufactures and exports subject
merchandise.
\12\ Qingdao Huatian Truck Co., Ltd., manufactures and exports subject
merchandise.

Disclosure

We will disclose the calculations performed within five days of the
date of publication of this notice to parties in this proceeding in
accordance with 19 CFR 351.224(b).

Suspension of Liquidation

In accordance with section 733(d)(2) of the Act, we will instruct
U.S. Customs and Border Protection (``CBP'') to suspend liquidation of
all entries of lawn groomers from the PRC as described in the ``Scope
of Investigation'' section, entered, or withdrawn from warehouse, for
consumption on or after the date of publication of this notice in the
Federal Register.
The Department has determined in its Certain Tow-Behind Lawn
Groomers and Certain Parts Thereof from the People's Republic of China:
Preliminary Affirmative Countervailing Duty Determination and Alignment
of Final Countervailing Duty Determination with Final Antidumping Duty
Determination, 73 FR 70971 (November 24, 2008) (``CVD Lawn Groomers
Prelim''), that the product under investigation, exported and produced
by Superpower, benefitted from an export subsidy. Normally, where the
product under investigation is also subject to a concurrent
countervailing duty investigation, we instruct CBP to require an
antidumping cash deposit or posting of a bond equal to the weighted-
average amount by which the NV exceeds the EP, as indicated above,
minus the amount determined to constitute an export subsidy. See, e.g.,
Notice of Final Determination of Sales at Less Than Fair Value:
Carbazole Violet Pigment 23 From India, 69 FR 67306, 67307 (November
17, 2007). Therefore, for merchandise under consideration exported and
produced by Superpower entered or withdrawn from warehouse, for
consumption on or after publication date of this preliminary
determination, we will instruct CBP to require an antidumping cash
deposit or the posting of a bond for each entry equal to the weighted-
average margin indicated above, adjusted for the export subsidy rate
determined in CVD Lawn Groomers Prelim (i.e., Income Tax Reduction for
Export-Oriented Enterprises countervailable subsidy of 0.15 percent ad
valorem). The adjusted cash deposit rate is 324.28 percent.
Furthermore, CVD Lawn Groomers Prelim indicates preliminarily that
Superpower received a countervailable subsidy of 0.64 percent ad
valorem under the ``Refund of Enterprise Income Taxes on FIE Profits
Reinvested in an EOE'' program. See CVD Lawn Groomers Prelim at 70978.
This subsidy contains both domestic and export subsidy components.
However, for the preliminary results of this investigation, the
Department will not be able to apply the export subsidy component to
Superpower's antidumping margin. For the final results, if applicable,
the Department will calculate the subsidy rates for each component and
apply the export subsidy portion to Superpower's antidumping margin.
Regarding all separate-rate recipients that were not selected as
mandatory respondents, we will instruct CBP to require an antidumping
cash deposit or the posting of a bond for each entry equal to the
average of the margins calculated for the mandatory respondents,
adjusted for their respective export subsidy rates, if applicable, from
CVD Lawn Groomers Prelim.
For the remaining exporters, pursuant to section 733(d)(1)(B), we
will instruct CBP to require a cash deposit or the posting of a bond
equal to the weighted-average amount by which the normal value exceeds
U.S. price, as follows: (1) the rate for the exporter/producer
combinations listed in the chart above will be the rate we have
determined in this preliminary determination; (2) for all PRC exporters
of subject merchandise which have not received their own rate, the
cash-deposit rate will be the PRC-wide rate; and (3) for all non-PRC
exporters of subject merchandise which have not received their own
rate, the cash-deposit rate will be the rate applicable to the PRC
exporter/producer combination that supplied that non-PRC exporter.
These suspension-of-liquidation instructions will remain in effect
until further notice.

International Trade Commission Notification

In accordance with section 733(f) of the Act, we have notified the
ITC of our preliminary affirmative determination of sales at LTFV.
Section 735(b)(2) of the Act requires the ITC to make its final
determination as to whether the domestic industry in the United States

[[Page 4936]]

is materially injured, or threatened with material injury, by reason of
imports of lawn groomers, or sales (or the likelihood of sales) for
importation, of the subject merchandise within 45 days of our final
determination.

Public Comment

Case briefs or other written comments may be submitted to the
Assistant Secretary for Import Administration no later than seven days
after the date the final verification report is issued in this
proceeding and rebuttal briefs, limited to issues raised in case
briefs, no later than five days after the deadline for submitting case
briefs. See 19 CFR 351.309(c)(1)(i) and 19 CFR 351.309(d)(1) and (2). 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. See 19 CFR
351.309(c)(2) and 19 CFR 351.309(d)(2).
In accordance with section 774(a)(1) 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.
If a request for a hearing is made, we intend to hold the hearing three
days after the deadline of submission of rebuttal briefs at the U.S.
Department of Commerce, 14th Street and Constitution Ave, 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 that 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 after the date of publication of
this notice. See 19 CFR 351.310(c). Requests should contain the party's
name, address, and telephone number, the number of participants, and 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).

Postponement of Final Determination

Pursuant to section 735(a)(2) of the Act, on December 18, 2008, and
December 23, 2008, Princeway and Superpower, respectively, requested
that in the event of an affirmative preliminary determination in this
investigation, the Department postpone its final determination by 60
days. At the same time, Princeway and Superpower agreed that the
Department may extend the application of the provisional measures
prescribed under 19 CFR 351.210(e)(2) from a 4-month period to a 6-
month period. In accordance with section 733(d) of the Act and 19 CFR
351.210(b)(2)(ii), we are granting the request and are postponing the
final determination until no later than 135 days after the publication
of this notice in the Federal Register because: (1) our preliminary
determination is affirmative, (2) the requesting exporters account for
a significant proportion of exports of the subject merchandise (see
Respondent Selection Memorandum), and (3) no compelling reasons for
denial exist. Suspension of liquidation will be extended accordingly.
This determination is issued and published in accordance with
sections 733(f) and 777(i)(1) of the Act.

Dated: January 16, 2009.
Ronald K. Lorentzen,
Acting Assistant Secretary for Import Administration.
[FR Doc. E9-1721 Filed 1-28-09; 8:45 am]
BILLING CODE 3510-DS-S