[Federal Register Volume 77, Number 152 (Tuesday, August 7, 2012)]
[Notices]
[Pages 47030-47036]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-19297]



[[Page 47030]]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-570-964]


Seamless Refined Copper Pipe and Tube From the People's Republic 
of China: Preliminary Results of the First Antidumping Duty 
Administrative Review, and Intent To Rescind in Part

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

SUMMARY: The Department of Commerce (``Department'') is conducting the 
first administrative review of the antidumping duty order on seamless 
refined copper pipe and tube (``copper pipe and tube'') from the 
People's Republic of China (``PRC'') for the period November 22, 2010, 
through October 31, 2011. The Department has preliminarily determined 
that sales have been made below normal value (``NV'') by the mandatory 
respondent examined in this administrative review. If these preliminary 
results are adopted in our final results of this review, the Department 
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'').

DATES: Effective Date: August 7, 2012.

FOR FURTHER INFORMATION CONTACT: Zev Primor, AD/CVD Operations, Office 
4, Import Administration, International Trade Administration, 
Department of Commerce, 14th Street and Constitution Avenue NW., 
Washington, DC 20230; telephone: (202) 482-4114.

SUPPLEMENTARY INFORMATION:

Background

    The Department received timely requests from Petitioners \1\ and 
certain PRC exporters, in accordance with 19 CFR 351.213(b), during the 
anniversary month of November to conduct a review of copper pipe and 
tube exporters from the PRC. On December 30, 2011, the Department 
initiated this review with respect to all requested companies.\2\
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    \1\ Cerro Flow Products, LLC, Wieland Copper Products, LLC, 
Mueller Copper Tube Products, Inc., and Mueller Copper Tube Company, 
Inc. (collectively, ``Petitioners'').
    \2\ See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Request for Revocation in Part, 76 FR 
82268, 82273-74 (December 30, 2011) (``Initiation Notice'').
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    On February 6, 2012, Petitioners withdrew their request for an 
administrative review for Golden Dragon Holding (Hong Kong) 
International Co., Ltd., Golden Dragon Precise Copper Tube Group, Inc., 
Hong Kong GD Trading Co., Ltd., Luvata Alltop (Zhongshan) Ltd., Luvata 
Tube (Zhongshan) Ltd., Ningbo Jintian Copper Tube Co., Ltd., Sinochem 
Ningbo Import & Export Co., Ltd., Sinochem Ningbo Ltd., Zhejiang Jiahe 
Pipes Inc., and Zhejiang Naile Copper Co., Ltd. However, Golden Dragon 
Precise Copper Tube Group, Inc. (``Golden Dragon'') requested a review 
of itself and did not withdraw its request.

Respondent Selection

    Section 777A(c)(1) of the Tariff Act of 1930, as amended (the 
``Act''), directs the Department to calculate individual weighted-
average dumping margins for each known exporter or producer of the 
subject merchandise.\3\ However, section 777A(c)(2) of the Act gives 
the Department discretion to limit its examination to a reasonable 
number of exporters or producers because of their large number, if it 
is not practicable to examine all exporters or producers for which the 
review is initiated.
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    \3\ See also 19 CFR 351.204(c) regarding respondent selection, 
in general.
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    On January 17, 2012, the Department released CBP data for entries 
of the subject merchandise during the POR under administrative 
protective order (``APO'') to all interested parties having access to 
materials released under APO and invited comments regarding the CBP 
data and respondent selection. The Department received comments 
regarding respondent selection on January 23, 2012. On February 24, 
2012, the Department selected Golden Dragon as the sole mandatory 
respondent for individual examination in this review.\4\
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    \4\ See Memorandum to Abdelali Elouaradia, AD/CVD Operations, 
Office 4, from Patrick O'Conner, International Trade Compliance 
Analyst, Office 4, regarding ``Respondent Selection in the 1st 
Antidumping Duty Administrative Review of Seamless Refined Copper 
Pipe and Tube from the People's Republic of China,'' dated February 
24, 2012.
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Questionnaires

    On February 27, 2012, the Department issued its initial non-market 
economy (``NME'') antidumping duty questionnaire to the mandatory 
respondent Golden Dragon. Golden Dragon timely responded to the 
Department's initial and subsequent supplemental questionnaires between 
March 2012 and June 2012.

Period of Review

    The POR is November 22, 2010, through October 31, 2011.

Scope of the Order

    For the purpose of the order, the products covered are all seamless 
circular refined copper pipes and tubes, including redraw hollows, 
greater than or equal to 6 inches (152.4 millimeters ``mm'') in length 
and measuring less than 12.130 inches (308.102 mm) (actual) in outside 
diameter (``OD''), regardless of wall thickness, bore (e.g., smooth, 
enhanced with inner grooves or ridges), manufacturing process (e.g., 
hot finished, cold-drawn, annealed), outer surface (e.g., plain or 
enhanced with grooves, ridges, fins, or gills), end finish (e.g., plain 
end, swaged end, flared end, expanded end, crimped end, threaded), 
coating (e.g., plastic, paint), insulation, attachments (e.g., plain, 
capped, plugged, with compression or other fitting), or physical 
configuration (e.g., straight, coiled, bent, wound on spools).
    The scope of the order covers, but is not limited to, seamless 
refined copper pipe and tube produced or comparable to the American 
Society for Testing and Materials (``ASTM'') ASTM-B42, ASTM-B68, ASTM-
B75, ASTM-B88, ASTM-B88M, ASTM-B188, ASTM-B251, ASTM-B251M, ASTM-B280, 
ASTM-B302, ASTM-B306, ASTM-359, ASTM-B743, ASTM-B819, and ASTM-B903 
specifications and meeting the physical parameters described therein. 
Also included within the scope of the order are all sets of covered 
products, including ``line sets'' of seamless refined copper tubes 
(with or without fittings or insulation) suitable for connecting an 
outdoor air conditioner or heat pump to an indoor evaporator unit. The 
phrase ``all sets of covered products'' denotes any combination of 
items put up for sale that is comprised of merchandise subject to the 
scope.
    ``Refined copper'' is defined as: (1) Metal containing at least 
99.85 percent by weight of copper; or (2) metal containing at least 
97.5 percent by weight of copper, provided that the content by weight 
of any other element does not exceed the following limits:

------------------------------------------------------------------------
                                                              Limiting
                                                               content
                          Element                            percent by
                                                               weight
------------------------------------------------------------------------
Ag--Silver................................................          0.25
As--Arsenic...............................................          0.5
Cd--Cadmium...............................................          1.3
Cr--Chromium..............................................          1.4
Mg--Magnesium.............................................          0.8
Pb--Lead..................................................          1.5
S--Sulfur.................................................          0.7
Sn--Tin...................................................          0.8
Te--Tellurium.............................................          0.8
Zn--Zinc..................................................          1.0
Zr--Zirconium.............................................          0.3
Other elements (each).....................................          0.3
------------------------------------------------------------------------
 

    Excluded from the scope of the order are all seamless circular 
hollows of

[[Page 47031]]

refined copper less than 12 inches in length whose OD (actual) exceeds 
its length. The products subject to the order are currently 
classifiable under subheadings 7411.10.1030 and 7411.10.1090 of the 
Harmonized Tariff Schedule of the United States (``HTSUS''). Products 
subject to the order may also enter under HTSUS subheadings 
7407.10.1500, 7419.99.5050, 8415.90.8065, and 8415.90.8085. Although 
the HTSUS subheadings are provided for convenience and customs 
purposes, the written description of the scope of the order is 
dispositive.

Intent To Rescind the Review in Part

    Petitioners timely requested an administrative review for Golden 
Dragon Holding (Hong Kong) International Co., Ltd., Hong Kong GD 
Trading Co., Ltd., Luvata Alltop (Zhongshan) Ltd., Luvata Tube 
(Zhongshan) Ltd., Ningbo Jintian Copper Tube Co., Ltd., Sinochem Ningbo 
Import & Export Co., Ltd., Sinochem Ningbo Ltd., Zhejiang Jiahe Pipes 
Inc., and Zhejiang Naile Copper Co., Ltd., companies which do not have 
a separate rate, and then timely withdrew their requests for review of 
the above-mentioned companies.\5\ Because these companies have not 
established their eligibility for a separate rate, they will continue 
to be considered part of the PRC-wide entity. Although the PRC-wide 
entity is not under review for these preliminary results, the 
possibility exists that the PRC-wide entity could be under review for 
the final results of this administrative review. Therefore, we are not 
rescinding this review with respect to these companies at this time, 
but we intend to rescind this review with respect to these companies in 
the final results if the PRC-wide entity is not reviewed.
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    \5\ See Petitioners' letter entitled, ``Seamless Refined Copper 
Pipe and Tube From the People's Republic of China: Withdrawal of 
Request for Antidumping Administrative Reviews, dated February 6, 
2012.
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Non-Market Economy Status

    In the original investigation, the Department treated the PRC as an 
NME.\6\ Moreover, in accordance with section 771(18)(C)(i) of the Act, 
the designation of a country as an NME remains in effect until it is 
revoked by the Department. As such, the Department continues to treat 
the PRC as an NME in this proceeding.
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    \6\ See Seamless Refined Copper Pipe and Tube From the People' s 
Republic of China: Final Determination of Sales at Less Than Fair 
Value (``LTFV Final Determination''), 75 FR 60725, 60727 (October 1, 
2010).
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Surrogate Country

    Section 773(c)(1) of the Act directs the Department to base NV, in 
most cases, on the NME producer's factors of production (``FOP'') 
valued in a surrogate market-economy (``ME'') country or countries 
considered appropriate by the Department. The Department will value 
FOPs, in accordance with section 773(c)(4) of the Act, by using ``to 
the extent possible, the prices or costs of factors of production in 
one or more market economy countries that are--(A) at a level of 
economic development comparable to that of the nonmarket economy 
country, and (B) significant producers of comparable merchandise.'' 
Further, pursuant to 19 CFR 351.408(c)(2), the Department will normally 
value FOPs in a single surrogate country.

Economic Comparability

    The Department identified Colombia, Indonesia, Peru, the 
Philippines, South Africa, Thailand, and Ukraine as countries equally 
comparable to the PRC in terms of economic development.\7\ Consistent 
with its practice, as reflected in the Policy Bulletin, the Department 
found that Colombia, Indonesia, Peru, the Philippines, South Africa, 
Thailand, and Ukraine are countries that are at a level of economic 
development comparable to that of the PRC and, therefore, satisfy the 
first criterion of section 773(c)(4) of the Act.\8\
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    \7\ See Memorandum regarding ``Request for a List of Surrogate 
Countries for an Administrative Review of the Antidumping Duty Order 
on Seamless Refined Copper Pipe and Tube (``CPT'') From the People's 
Republic of China (``China''), dated April 2, 2012.
    \8\ See Department Policy Bulletin No. 04.1: Non-Market Economy 
Surrogate Country Selection Process (March 1, 2004) (``Policy 
Bulletin''); Memorandum from Maisha Cryor, International Trade 
Compliance Analyst, AD/CVD Operations, Office 4, to Abdelali 
Elouaradia, Director, AD/CVD Operations, Office 4, ``First 
Antidumping Duty Administrative Review of Seamless Refined Copper 
Pipe and Tube From the People's Republic of China: Selection of a 
Surrogate Country'' (August 1, 2012) (``Surrogate Country 
Memorandum'') at 2.
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Significant Producer of Comparable Merchandise

    In order to identify which countries export merchandise comparable 
to the merchandise under consideration, we reviewed export data 
submitted by Golden Dragon and Petitioners, along with Global Trade 
Atlas (``GTA'') data generated by the Department. After reviewing this 
export data, we have determined that Thailand is a significant producer 
of subject merchandise in significant quantities.

Data Availability

    When evaluating surrogate value (``SV'') data, the Department 
considers several factors, including whether the SVs are publicly 
available, contemporaneous with the POR, representative of a broad 
market average, tax and duty-exclusive, and specific to the inputs 
being valued.\9\ The record of this proceeding includes Thai SV data 
for copper cathodes, which is the primary raw material component in the 
production of subject merchandise.\10\ In addition, the record contains 
two Thai financial statements, i.e., Kobelco & Materials Copper Tube 
(Thailand) Co., Ltd (``Kobelco'') and Furukawa Metal (Thailand) Public 
Company Limited (``Furukawa''). However, given that Kobelco's financial 
statements were not fully translated, the Department has decided to use 
the Furukawa's audited financial statements, a producer of identical 
merchandise from Thailand. After thoroughly reviewing these data, the 
Department has determined that the Thai import data are more complete, 
with respect to the primary direct raw material input as well as to all 
other inputs. Therefore, based on the above data considerations, we 
consider Thailand to have the best available information for use as the 
primary surrogate country in this administrative review. In accordance 
with 19 CFR 351.301(c)(3)(ii), for the final results of this 
administrative review, interested parties may submit publicly available 
information to value the FOPs within 20 days after the date of 
publication of these preliminary results.
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    \9\ See Policy Bulletin; Surrogate Country Memorandum at 6.
    \10\ See Section D Response at 2; see also Golden Dragon's SV 
Comments and Petitioners' Supplemental SV Comments.
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Separate Rates

    In proceedings involving NME countries, it is the Department's 
practice to begin with a rebuttable presumption that all companies 
within the NME country are subject to government control and thus 
should be assessed a single antidumping duty rate.\11\ In the 
Initiation Notice, the Department notified parties of the application 
process by which exporters and producers may obtain separate rate 
status in NME reviews.\12\ It is the Department's policy to assign all

[[Page 47032]]

exporters of merchandise subject to investigation in an NME country 
this single rate unless an exporter can affirmatively demonstrate that 
it is sufficiently independent so as to be entitled to a separate 
rate.\13\ Exporters can demonstrate this independence through the 
absence of both de jure and de facto government control over export 
activities.\14\ The Department analyzes each entity's export 
independence under a test first articulated in Sparklers and as further 
developed in Silicon Carbide.\15\ However, if the Department determines 
that a company is wholly foreign-owned or located in an ME, then a 
separate rate analysis is not necessary to determine whether it is 
independent from government control.\16\
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    \11\ See, e.g., Final Determination of Sales at Less Than Fair 
Value and Final Partial Affirmative Determination of Critical 
Circumstances: Diamond Sawblades and Parts Thereof From the People's 
Republic of China, 71 FR 29303, 29307 (May 22, 2006).
    \12\ See Initiation Notice, 76 FR at 88269.
    \13\ See id.
    \14\ See id.
    \15\ See Final Determination of Sales at Less Than Fair Value: 
Sparklers From the People's Republic of China, 56 FR 20588 (May 6, 
1991) (``Sparklers''); and Notice of 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'').
    \16\ See, e.g., Final Results of Antidumping Duty Administrative 
Review: Petroleum Wax Candles From the People's Republic of China, 
72 FR 52355, 52356 (September 13, 2007).
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    The Department received a separate rate certification from Hong 
Kong Hailiang Metal Trading Limited, Zhejiang Hailiang Co., Ltd., and 
Shanghai Hailiang Copper Co., Ltd. (collectively ``Hailiang'').\17\ 
Additionally, the Department received completed responses to the 
Section A portion of the NME questionnaire from Golden Dragon which 
contained information pertaining to Golden Dragon's eligibility for a 
separate rate.\18\
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    \17\ See Separate Rate Certification of Hong Kong Hailiang Metal 
Trading Limited, dated March 6, 2012 (``Hailiang SRC Response'').
    \18\ See Golden Dragon's Section A Questionnaire Response, dated 
March 28, 2012.
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Separate Rate Recipients

1. Joint Ventures Between Chinese and Foreign Companies or Wholly 
Chinese-Owned Companies
    Golden Dragon and Hailiang, the separate rate applicants in this 
administrative review, stated that they are either joint ventures 
between Chinese and foreign companies or are wholly Chinese-owned 
companies.\19\ In accordance with its practice, the Department has 
analyzed whether the separate-rate applicants have demonstrated the 
absence of de jure and de facto governmental control over their 
respective export activities.
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    \19\ See Golden Dragon's Section A Questionnaire Response at A-
1--A-2 and Hailiang SRC Response at 4.
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a. 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.\20\ The evidence provided by Golden Dragon and Hailiang 
supports a preliminary finding of an absence of de jure government 
control based on the following: (1) An absence of restrictive 
stipulations associated with the individual exporter's business and 
export licenses; (2) there are applicable legislative enactments 
decentralizing control of the companies; and (3) there are formal 
measures by the government decentralizing control of companies.\21\
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    \20\ See Sparklers, 56 FR at 20589.
    \21\ See Golden Dragon's Section A Questionnaire Response at A-
4--A-6 and Hailiang SRC Response at 7-8.
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b. Absence of De Facto Control
    Typically the Department considers four factors in evaluating 
whether each respondent is subject to de facto government control of 
its export functions: (1) Whether the export prices are set by or are 
subject to the approval of a government 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.\22\ 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 government control which would preclude 
the Department from assigning separate rates. The evidence provided by 
Golden Dragon and Hailiang supports a preliminary finding of an absence 
of de facto government control based on the following: (1) The 
companies set their own export prices independent of the government and 
without the approval of a government authority; (2) the companies have 
authority to negotiate and sign contracts and other agreements; (3) the 
companies have autonomy from the government in making decisions 
regarding the selection of management; and (4) there is no restriction 
on any of the companies' use of export revenue.\23\ Therefore, the 
Department preliminarily finds that Golden Dragon and Hailiang have 
established that they qualify for a separate rate under the criteria 
established by Silicon Carbide and Sparklers.
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    \22\ 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).
    \23\ Golden Dragon's Section A Questionnaire Response at A-6--A-
10 and Hailiang SRC Response at 8-10.
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Rate for Respondents Not Individually Examined

    The statute and the Department's regulations do not address the 
establishment of a rate to be applied to individual respondents not 
selected for examination when the Department limits its examination in 
an administrative review pursuant to section 777A(c)(2) of the Act. 
Generally, the Department looks to section 735(c)(5) of the Act, which 
provides instructions for calculating the all-others rate in an 
investigation, for guidance when calculating the rate for respondents 
which we did not examine in an administrative review. Section 
735(c)(5)(A) of the Act articulates a preference that we are not to 
calculate an all-others rate using rates which are zero, de minimis or 
based entirely on facts available. Accordingly, the Department's usual 
practice has been to average the weighted-average dumping margins for 
the selected companies, excluding rates that are zero, de minimis, or 
based entirely on facts available.\24\ Section 735(c)(5)(B) of the Act 
also provides that, where all rates are zero, de minimis, or based 
entirely on facts available, we may use ``any reasonable method'' for 
assigning the all-others rate, including ``averaging the estimated 
weighted-average dumping margins determined for the exporters and 
producers individually investigated.''
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    \24\ See Ball Bearings and Parts Thereof From France, Germany, 
Italy, Japan, and the United Kingdom: Final Results of Antidumping 
Duty Administrative Reviews and Rescission of Reviews in Part, 73 FR 
52823, 52824 (September 11, 2008), and accompanying Issues and 
Decision Memorandum at Comment 16.
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    In previous administrative reviews, the Department has determined 
that a ``reasonable method'' to use when the rates for the respondents 
selected for individual examination are zero, de minimis, or based 
entirely on facts available, is to apply to those respondents not 
selected for individual examination (and eligible for a separate rate 
in an NME review) the average of the most recently-determined weighted-

[[Page 47033]]

average dumping margins that are not zero, de minimis, or based 
entirely on facts available. These rates may be from the investigation, 
a prior administrative review, or a new shipper review.\25\ If any such 
non-selected respondent had its own calculated rate that is 
contemporaneous with or more recent than such prior determined rates, 
however, the Department has applied such individual rate to the non-
selected respondent in the instant review, including when that rate is 
zero, de minimis.\26\
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    \25\ See, e.g., Certain Frozen Warmwater Shrimp From the 
People's Republic of China: Preliminary Results and Preliminary 
Partial Rescission of Fifth Antidumping Duty Administrative Review, 
76 FR 8338, 8342 (February 14, 2011), unchanged in Administrative 
Review of Certain Frozen Warmwater Shrimp From the People's Republic 
of China: Final Results and Partial Rescission of Antidumping Duty 
Administrative Review, 76 FR 51940 (August 19, 2011); see also 
Administrative Review of Certain Frozen Warmwater Shrimp From the 
People's Republic of China: Final Results and Partial Rescission of 
Antidumping Duty Administrative Review, 75 FR 49460, 49463 (August 
13, 2010), and Amanda Foods (Vietnam) Ltd. v. United States, 774 F. 
Supp. 2d 1286 (CIT 2011).
    \26\ See, e.g., Freshwater Crawfish Tail Meat From the People's 
Republic of China: Final Results of Antidumping Duty Administrative 
Review and Rescission of Review in Part, 77 FR 21529, 21530-31 
(April 10, 2012).
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    In this administrative review, there is one non-selected 
respondent, Hailiang, which is under review and is eligible for a 
separate rate. Hailiang received its own calculated rate that is 
contemporaneous with or more recent than the most recent rates 
determined for other respondents that are not zero, de minimis, or 
based entirely on facts available. Accordingly, we have concluded in 
this administrative review that a reasonable method for determining the 
rate for Hailiang is to apply its most recent, individually-calculated, 
rate. Pursuant to this method, we have assigned a rate of 60.85 percent 
to Hailiang, its weighted-average dumping margin in the antidumping 
investigation.\27\ In assigning this separate rate, we did not impute 
the actions of other respondents to the behavior of Hailiang, but based 
this determination on record evidence that may be deemed reasonably 
reflective of the potential margin of dumping for Hailiang in this 
administrative review.
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    \27\ See LTFV Final Determination, 75 FR at 60729.
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Date of Sale

    Golden Dragon reported the invoice date as the date of sale because 
it claims that for its U.S. sales of subject merchandise made during 
the POR, the material terms of sale were established on the invoice 
date.\28\ After evaluating Golden Dragon's claim in light of record 
evidence, the Department, in accordance with 19 CFR 351.401(i) and its 
long-standing practice of determining the date of sale,\29\ 
preliminarily determines that the invoice date is the most appropriate 
date to use as Golden Dragon's date of sale.
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    \28\ See Golden Dragon's Section C Questionnaire Response at C-
18.
    \29\ See, e.g., Notice of Final Determination of Sales at Less 
Than Fair Value and Negative Final Determination of Critical 
Circumstances: Certain Frozen and Canned Warmwater Shrimp From 
Thailand, 69 FR 76918 (December 23, 2004), and accompanying Issues 
and Decision Memorandum at Comment 10.
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Fair Value Comparisons

    Pursuant to section 773(c) of the Act and 19 CFR 351.414(c)(1) and 
(d), the Department compared weighted-average export price or weighted-
average constructed export price to the weighted-average NV, as 
described in the ``U.S. Price,'' and ``Normal Value'' sections 
below.\30\
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    \30\ In these preliminary results, the Department applied the 
weighted-average dumping margin calculation method adopted in 
Antidumping Proceedings: Calculation of the Weighted-Average Dumping 
Margin and Assessment Rate in Certain Antidumping Proceedings: Final 
Modification, 77 FR 8101 (February 14, 2012) (``Final Modification 
for Reviews''). In particular, the Department compared monthly 
weighted-average export prices (or constructed export prices) with 
monthly weighted-average normal values and granted offsets for non-
dumped comparisons in the calculation of the weighted average 
dumping margin.
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U.S. Price

Export Price

    We considered the U.S. prices of certain sales by Golden Dragon to 
be export price (``EP'') sales in accordance with section 772(a) of the 
Act, because these were the prices at which the subject merchandise was 
first sold before the date of importation by the 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.
    We calculated EP based on the price to unaffiliated purchaser(s) in 
the United States. We deducted movement expenses from the gross unit 
U.S. sales price in accordance with section 772(c)(2)(A) of the Act. 
These movement expenses include foreign inland freight from the plant 
to the port of exportation. For a detailed description of all 
adjustments, see Golden Dragon's Preliminary Analysis Memorandum.\31\
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    \31\ See Memorandum from Zev Primor, Analyst, to Robert Bolling, 
Program Manager, Regarding Golden Dragon's Preliminary Results 
Analysis Memorandum, dated August 1, 2012 (``Golden Dragon 
Preliminary Analysis Memo'').
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Constructed Export Price

    In accordance with section 772(b) of the Act, constructed export 
price (``CEP'') is the price at which the subject merchandise is first 
sold (or agreed to be sold) in the United States before or after the 
date of importation by or for the account of the producer or exporter 
of such merchandise or by a seller affiliated with the producer or 
exporter, to a purchaser not affiliated with the producer or exporter, 
as adjusted under sections 772(c) and (d) of the Act. We considered 
sales made by Golden Dragon's U.S. affiliate in the United States to be 
CEP sales. We calculated CEP based on prices to unaffiliated purchasers 
in the United States. In accordance with sections 772(c)(2)(A) and 
772(d)(1) and of the Act, where applicable, we made deductions from the 
starting price for movement expenses, and commissions, credit expenses, 
inventory carrying costs, warranty expenses, and indirect selling 
expenses which relate to commercial activity in the United States. 
Movement expenses included, where applicable, foreign inland freight 
from the plant to the port of exportation, foreign brokerage and 
handling, international freight, marine insurance, U.S. inland freight 
from the port to the warehouse, U.S. freight from the warehouse to the 
customer, U.S. customs duty and U.S. warehousing expenses. In addition, 
we deducted CEP profit from U.S. price in accordance with sections 
772(d)(3) and 772(f) of the Act. As a CEP adjustment and in accordance 
with section 773(a) of the Act, we calculated Golden Dragon's credit 
expenses and inventory carrying costs based on short-term interest 
rates. Because Golden Dragon did not incur short-term U.S. dollar 
borrowings during the POR, we based its interest rate on the short-term 
interest rate from the Federal Reserve. For those expenses that were 
provided by an ME provider and paid for in an ME currency, the 
Department used the reported expense. Due to the proprietary nature of 
certain adjustments to U.S. price, see Golden Dragon's Preliminary 
Analysis Memo, for a detailed description of all adjustments.

Normal Value

    Section 773(c)(1) of the Act provides that the Department shall 
determine NV using an FOP 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. When determining 
NV in an NME context, the

[[Page 47034]]

Department will base NV on FOPs because the presence of government 
controls on various aspects of these economies renders price 
comparisons and the calculation of production costs invalid under our 
normal methodologies. Under section 773(c)(3) of the Act, FOPs include 
but are not limited to: (1) Hours of labor required; (2) quantities of 
raw materials employed; and (3) representative capital costs. The 
Department used FOPs reported by Golden Dragon for materials, labor, 
packing and by-products.

Factor Valuations

    In accordance with section 773(c) of the Act, we calculated NV 
based on FOPs reported by Golden Dragon for the POR. In accordance with 
19 CFR 351.408(c)(1), the Department will normally use publicly 
available information to find an appropriate SV to value each FOP, but 
when a producer sources an input from an ME and pays for it in an ME 
currency, the Department normally will value the factor using the 
actual price paid for the input.\32\ To calculate NV, the Department 
multiplied the reported per-unit factor-consumption rates by publicly 
available SVs (except as discussed below). In selecting SVs, the 
Department considered the quality, specificity, and contemporaneity of 
the data.\33\ As appropriate, we adjusted input prices by including 
freight costs to make them delivered prices. Specifically, we added to 
import SVs 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, where 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, 1407-08 (Fed. 
Cir. 1997).
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    \32\ See 19 CFR 351.408(c)(1); see also Shakeproof Assembly 
Components Div of Ill Tool Works v. United States, 268 F.3d 1376, 
1382-83 (Fed. Cir. 2001) (affirming the Department's use of market-
based prices to value certain FOPs).
    \33\ See, e.g., Fresh Garlic From the People's Republic of 
China: Final Results of Antidumping Duty New Shipper Review, 67 FR 
72139 (December 4, 2002), and accompanying Issues and Decision 
Memorandum at Comment 6; and Final Results of First New Shipper 
Review and First Antidumping Duty Administrative Review: Certain 
Preserved Mushrooms From the People's Republic of China, 66 FR 31204 
(June 11, 2001), and accompanying Issues and Decision Memorandum at 
Comment 5.
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    For the preliminary results, except where noted below, we used data 
from the Thai import statistics in the GTA and other publicly available 
Thai sources in order to calculate SVs for Golden Dragon's FOPs (i.e., 
direct materials, energy, and packing materials) and certain movement 
expenses. In selecting the best available information for valuing FOPs 
in accordance with section 773(c)(1) of the Act, the Department's 
practice is to select, to the extent practicable, SVs which are non-
export average values, most contemporaneous with the POR, product-
specific, and tax-exclusive.\34\ The record shows that Thai import 
statistics obtained through GTA are contemporaneous with the POR, 
product-specific, and tax-exclusive.\35\ In those instances where we 
could not obtain publicly available information contemporaneous to the 
POR with which to value factors, we adjusted the SVs using, where 
appropriate, the Thai Producer Price Index (``PPI'') or Consumer Price 
Index (``CPI''), as published in the International Monetary Fund's 
International Financial Statistics.\36\
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    \34\ 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 Warm water Shrimp from the Socialist Republic of Vietnam, 69 
FR 71005 (December 8, 2004).
    \35\ See Antidumping Duty Administrative Review of Seamless 
Refined Copper Pipe and Tube from the People's Republic of China: 
Surrogate Value Memorandum (``Surrogate Value Memorandum'') at 2.
    \36\ See, e.g., Certain Kitchen Appliance Shelving and Racks 
From the People's Republic of China: Preliminary Determination of 
Sales at Less Than Fair Value and Postponement of Final 
Determination, 74 FR 9600 (March 5, 2009), unchanged in Certain 
Kitchen Appliance Shelving and Racks From the People's Republic of 
China: Final Determination of Sales at Less than Fair Value, 74 FR 
36656 (July 24, 2009).
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    In accordance with legislative history, the Department continues to 
apply its long-standing practice of disregarding SVs if it has a reason 
to believe or suspect the source data may be subsidized.\37\ In this 
regard, the Department has previously found that it is appropriate to 
disregard such import statistics from India, Indonesia, South Korea and 
Thailand because we have determined that these countries maintain 
broadly available, non-industry specific export subsidies.\38\ Based on 
the existence of these subsidy programs that were generally available 
to all exporters and producers in these countries at the time of the 
POR, the Department finds that it is reasonable to infer that all 
exporters from India, Indonesia, South Korea and Thailand may have 
benefitted from these subsidies. Therefore, we have not used prices 
from India, Indonesia, South Korea and Thailand in calculating the 
import-based SVs.
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    \37\ Omnibus Trade and Competitiveness Act of 1988, Conf. Report 
to Accompany H.R. 3, H.R. Rep. No. 576, 100th Cong., 2nd Sess. 
(1988) at 590.
    \38\  See, e.g., Carbazole Violet Pigment 23 From India: Final 
Results of the Expedited Five-year (Sunset) Review of the 
Countervailing Duty Order, 75 FR 13257 (March 19, 2010), and 
accompanying Issues and Decision Memorandum at 4-5; Certain Cut-to-
Length Carbon-Quality Steel Plate From Indonesia: Final Results of 
Expedited Sunset Review, 70 FR 45692 (August 8, 2005), and 
accompanying Issues and Decision Memorandum at 4; Corrosion-
Resistant Carbon Steel Flat Products From the Republic of Korea: 
Final Results of Countervailing Duty Administrative Review, 74 FR 
2512 (January 15, 2009), and accompanying Issues and Decision 
Memorandum at 17, 19-20; Final Affirmative Countervailing Duty 
Determination: Certain Hot-Rolled Carbon Steel Flat Products From 
Thailand, 66 FR 50410 (October 3, 2001), and accompanying Issues and 
Decision Memorandum at 23.
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    Additionally, we disregarded prices from NME countries.\39\ 
Finally, imports that were labeled as originating from an 
``unspecified'' country were excluded from the average value, because 
we could not be certain that they were not from either an NME country 
or a country with generally available export subsidies.\40\
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    \39\  See, e.g., Certain Kitchen Appliance Shelving and Racks 
From the People's Republic of China: Preliminary Determination of 
Sales at Less Than Fair Value and Postponement of Final 
Determination, 74 FR 9591, 9600 (March 5, 2009), unchanged in 
Certain Kitchen Appliance Shelving and Racks From the People's 
Republic of China: Final Determination of Sales at Less Than Fair 
Value, 74 FR 36656 (July 24, 2009) and Certain Kitchen Appliance 
Shelving and Racks from the People's Republic of China: Amended 
Final Determination of Sales at Less Than Fair Value and Notice of 
Antidumping Duty Order, 74 FR 46971 (September 14, 2009).
    \40\  See id.
---------------------------------------------------------------------------

    We valued truck freight expenses using a price list for domestic 
shipments from the Thailand Board of Investment. The rates were in 
effect prior to the POR, so we adjusted them to be contemporaneous with 
the POR, using PPI.\41\
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    \41\ See Surrogate Value Memorandum at 6 and Exhibits 1 and 7.
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    On June 21, 2011, the Department revised its methodology for 
valuing the labor input in NME antidumping duty proceedings.\42\ In 
Labor Methodologies, the Department determined that the best 
methodology to value the labor input is to use industry-specific labor 
rates from the primary surrogate country. Additionally, the Department 
determined that the best data source for industry-specific labor rates 
is Chapter 6A: Labor Cost in Manufacturing, from the International 
Labor Organization (``ILO'') Yearbook of Labor Statistics 
(``Yearbook'').
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    \42\ See Antidumping Methodologies in Proceedings Involving Non-
Market Economies: Valuing the Factor of Production: Labor, 76 FR 
36092 (June 21, 2011) (``Labor Methodologies'').

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[[Page 47035]]

    The Department valued labor using the methodology described in 
Labor Methodologies. Specifically, to value the respondents' labor the 
Department relied on data reported by Thailand to the ILO in Chapter 6A 
of the Yearbook for the total manufacturing wage data. Although the 
Department found that the two-digit description under ISIC-Revision 3.1 
(``Manufacture of Machinery and Equipment NEC'') is the best available 
information on the record with which to value labor because it is 
specific to the industry being examined, and is, therefore, derived 
from industries that produce comparable merchandise, Thailand has not 
reported data specific to the two-digit description since 2000. 
However, Thailand did report total manufacturing wage data in 2005. 
Accordingly, relying on Chapter 6A of the Yearbook, the Department 
calculated the labor value using total labor data reported by Thailand 
to the ILO in 2005, in accordance with section 773(c)(4) of the 
Act.\43\ Because these rates were in effect before the POR, we are 
adjusting the average value for inflation using CPI. A more detailed 
description of the wage rate calculation methodology is provided in the 
Surrogate Value Memorandum. The ILO data from Chapter 6A of the 
Yearbook, which was used to value labor, reflects all costs related to 
labor, including wages, and indirect labor costs such as benefits, 
housing, and training. The financial statements used to calculate the 
surrogate financial ratios do not include itemized details regarding 
the indirect labor costs incurred. Therefore, the Department has not 
made adjustments to the surrogate financial ratios.\44\
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    \43\ See Labor Methodologies, 76 FR at 36094, n.11; see also 
Small Diameter Graphite Electrodes From the People's Republic of 
China: Preliminary Results and Partial Rescission of Administrative 
Review, 77 FR 13284, 13292-93 (March 6, 2012) (relying upon national 
data reported by ILO Chapter 6A in the absence of Chapter 6A 
industry-specific data), unchanged in Small Diameter Graphite 
Electrodes from the People's Republic of China: Final Results of 
Administrative Review, 77 FR 40854 (July 11, 2012).
    \44\ See Labor Methodologies, 76 FR at 36094.
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    Because water was used by Golden Dragon in the production of 
seamless copper pipe and tube, the Department considers water to be a 
direct material input rather than overhead.\45\ We valued water using 
data from the Metropolitan Waterworks Authority. We did not inflate 
this rate since it is contemporaneous with the POR.\46\
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    \45\ See Final Determination of Sales at Less Than Fair Value 
and Critical Circumstances: Certain Malleable Iron Pipe Fittings 
From the People's Republic of China, 68 FR 61395 (October 28, 2003), 
and accompanying Issues and Decision Memorandum at Comment 11.
    \46\ See Surrogate Value Memorandum at 5 and Exhibit 3.
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    We valued brokerage and handling using a price list of export 
procedures necessary to export a standardized cargo of goods in 
Thailand. The price list is compiled based on a survey case study of 
the procedural requirements for trading a standard shipment of goods by 
ocean transport in Thailand as reported in ``Doing Business 2012: 
Thailand'' published by the World Bank.\47\
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    \47\ See Surrogate Value Memorandum at 6 and Exhibit 6.
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    We valued marine insurance using a marine insurance rate offered by 
RJG Consultants. The rate is a percentage of the value of the shipment; 
thus we did not inflate or deflate the rate.\48\
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    \48\ See Surrogate Value Memorandum at 6 and Exhibit 8.
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    We were unable to segregate and, therefore, were unable to exclude 
energy costs from the calculation of the surrogate financial ratios. 
Accordingly, for the preliminary results, we have disregarded the 
respondents' energy inputs (electricity) in the calculation of NV, in 
order to avoid double-counting energy costs that have necessarily been 
captured in the surrogate financial ratios.\49\
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    \49\ See Citric Acid and Certain Citrate Salts from the People's 
Republic of China: Final Affirmative Determination of Sales at Less 
Than Fair Value, 74 FR 16838 (April 13, 2009), and accompanying 
Issues and Decision Memorandum at Comment 2.
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    To value factory overhead, selling, general, and administrative 
expenses, and profit, we used audited financial statements for the year 
ending December 2011 of Furukawa Metal (Thailand) Public Company 
Limited, a producer of identical merchandise from Thailand.\50\ The 
Department has not used for these preliminary results the financial 
statement from Kobelco & Materials Copper Tube (Thailand) Co., Ltd., 
that is on the record because that financial statement is incomplete 
and not fully translated.\51\ The Department may consider other 
publicly available financial statements for the final results, as 
appropriate.
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    \50\ See Surrogate Value Memorandum at 5 and Exhibit 5 and 1.
    \51\ See Surrogate Value Memorandum at 5.
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    Golden Dragon reported that it recycles copper scrap and sells a 
small amount of copper slag and copper ash; therefore, the Department 
has granted a by-product offset for the quantities of Golden Dragon's 
reported by-products, valued using Thai GTA data.\52\
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    \52\ See Golden Dragon's Preliminary Analysis Memo at 8.
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Currency Conversion

    Where appropriate, the Department made currency conversions into 
U.S. dollars, in accordance with section 773A(a) of the Act, based on 
the exchange rates in effect on the dates of the U.S. sales as 
certified by the Federal Reserve Bank.

Preliminary Results of Review

    The Department preliminarily determines that the following 
weighted-average dumping margins exist:

------------------------------------------------------------------------
               Exporter                               Rate
------------------------------------------------------------------------
Golden Dragon........................  0.00 (de minimis)
Hailiang.............................  60.85
------------------------------------------------------------------------

Disclosure

    The Department intends to disclose calculations performed for these 
preliminary results to the parties within 10 days of the date of the 
public announcement of the results of this review in accordance with 19 
CFR 351.224(b).

Comments

    Interested parties may submit written comments no later than 30 
days after the date of publication of these preliminary results of 
review.\53\ Rebuttal comments must be limited to the issues raised in 
the written comments and may be filed no later than five days after the 
time limit for filing the case briefs.\54\ 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, filed electronically using 
Import Administration's Antidumping and Countervailing Duty Centralized 
Electronic Service System (``IA ACCESS''). An electronically filed 
document must be received successfully in its entirety by the 
Department's electronic records system, IA ACCESS, by 5 p.m. Eastern 
Standard Time within 30 days after the date of publication of this 
notice.\55\ Requests should contain the party's name, address, and 
telephone number, the number of participants, and a list of the issues 
to be discussed. If a request for a hearing is made, we will inform 
parties of the scheduled date for the hearing which will be held at the 
U.S. Department of Commerce, 14th Street and Constitution Avenue NW, 
Washington, DC 20230, at a time and location to be determined.\56\

[[Page 47036]]

Parties should confirm by telephone the date, time, and location of the 
hearing. The Department intends to issue the final results of the 
administrative review, which will include the results of its analysis 
of issues raised in the briefs, within 120 days of publication of these 
preliminary results, in accordance with section 751(a)(3)(A) of the 
Act, unless the time limit is extended.
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    \53\ See 19 CFR 351.309(c)(1)(ii).
    \54\ See 19 CFR 351.309(d).
    \55\ See 19 CFR 351.310(c).
    \56\ See 19 CFR 351.310.
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Assessment Rates

    Upon issuance of the final results, the Department will determine, 
and CBP shall assess, antidumping duties on all appropriate entries 
covered by the review. The Department intends to issue assessment 
instructions to CBP 15 days after the publication date of the final 
results of the review. In accordance with 19 CFR 351.212(b)(1), we 
calculated exporter/importer (or customer)-specific assessment rates 
for the merchandise subject to the review.
    Where the respondent reports reliable entered values, we calculate 
importer (or customer)-specific ad valorem rates by aggregating the 
dumping margins calculated for all U.S. sales to each importer (or 
customer) and dividing this amount by the total entered value of the 
sales to each importer (or customer).\57\ Where an importer (or 
customer)-specific ad valorem rate is greater than de minimis, we will 
apply the assessment rate to the entered value of the importers'/
customers' entries during the POR.\58\ Where we do not have entered 
values for all U.S. sales, we calculate a per-unit assessment rate by 
aggregating the antidumping duties due for all U.S. sales to each 
importer (or customer) and dividing this amount by the total quantity 
sold to that importer (or customer). To determine whether the duty 
assessment rates are above de minimis, in accordance with the 
requirement set forth in 19 CFR 351.106(c)(2), we calculated importer 
(or customer)-specific ad valorem ratios based on the entered value. 
Where an importer (or customer)-specific ad valorem rate is zero or de 
minimis, we will instruct CBP to liquidate appropriate entries without 
regard to antidumping duties.\59\
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    \57\ See 19 CFR 351.212(b)(1).
    \58\ See 19 CFR 351.212(b)(1).
    \59\ See 19 CFR 351.106(c)(2).
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    The Department recently announced a refinement to its assessment 
practice in NME cases. Pursuant to this refinement in practice, for 
entries that were not reported in the U.S. sales databases submitted by 
companies individually examined during this review, the Department will 
instruct CBP to liquidate such entries at the NME-wide rate. In 
addition, if the Department determines that an exporter under review 
had no shipments of the subject merchandise, any suspended entries that 
entered under that exporter's case number (i.e., at that exporter's 
rate) will be liquidated at the NME-wide rate. For a full discussion of 
this practice, see Non-Market Economy Antidumping Proceedings: 
Assessment of Antidumping Duties, 76 FR 65694 (October 24, 2011).

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 from the PRC entered or withdrawn 
from warehouse, for consumption, on or after the publication date, as 
provided by section 751(a)(2)(C) of the Act: (1) For Golden Dragon the 
cash deposit rate will be its rate established in the final results of 
this review; (2) for previously investigated or reviewed PRC and non-
PRC exporters not listed above that have separate rates, the cash 
deposit rate will continue to be the exporter-specific rate published 
for the most recent segment; (3) for all PRC exporters of subject 
merchandise which have not been found to be entitled to a separate 
rate, the cash deposit rate will be that for the PRC-wide entity; and 
(4) 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 exporters that supplied those non-PRC exporters. 
These deposit requirements, when imposed, shall remain in effect until 
further notice.

Notification of Interested Parties

    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 351.402(f) to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    This administrative review and this notice are in accordance with 
sections 751(a)(1) and (3) and 777(i) of the Act, and 19 CFR 351.213.

    Dated: July 31, 2012.
Paul Piquado,
Assistant Secretary for Import Administration.
[FR Doc. 2012-19297 Filed 8-6-12; 8:45 am]
BILLING CODE 3510-DS-P