81 FR 58419 - Modification of Regulations Regarding Basis for Normal Value
DEPARTMENT OF COMMERCE
International Trade Administration Federal Register Volume 81, Issue 165 (August 25, 2016)
International Trade Administration
Federal Register Volume 81, Issue 165 (August 25, 2016)
| Page Range | 58419-58421 | |
| FR Document | 2016-20417 |
[Federal Register Volume 81, Number 165 (Thursday, August 25, 2016)] [Proposed Rules] [Pages 58419-58421] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-20417] ======================================================================= ----------------------------------------------------------------------- DEPARTMENT OF COMMERCE International Trade Administration 19 CFR Part 351 [Docket Number 160815742-6742-01] RIN 0625-AB08 Modification of Regulations Regarding Basis for Normal Value AGENCY: Enforcement and Compliance, International Trade Administration, Department of Commerce. ACTION: Proposed rule and request for comments. ----------------------------------------------------------------------- SUMMARY: The Department of Commerce (``the Department'') proposes to modify the regulations pertaining to the use of constructed value or third country sales for purposes of determining normal value, where the exporting country does not constitute a viable market, and is seeking comments from parties. This modification, if adopted, will specify that, where the exporting country does not constitute a viable market, the Department normally will calculate normal value based upon constructed value. This modification would invert the preexisting order of preference that, where the exporting country does not constitute a viable market, the Department normally calculates normal value based on sales in a viable third country. The Department proposes this modification in light of certain advantages of constructed value over third country sales, such as availability of cost of production information and comparability to U.S. prices. DATES: To be assured of consideration, written comments must be received no later than September 26, 2016. ADDRESSES: All comments must be submitted through the Federal eRulemaking Portal at http://www.regulations.gov, Docket No. ITA-2016- 0009, unless the commenter does not have access to the internet. Commenters that do not have access to the internet may submit the original and one electronic copy on CD-ROM of each set of comments by mail or hand delivery/courier. All comments should be addressed to Paul Piquado, Assistant Secretary for Enforcement & Compliance, Room 1870, Department of Commerce, 14th Street and Constitution Ave. NW., Washington, DC 20230. Comments submitted to the Department will be uploaded to the eRulemaking Portal at www.Regulations.gov. The Department will consider all comments received before the close of the comment period. All comments responding to this notice will be a matter of public record and will be available on the Federal eRulemaking Portal at www.Regulations.gov. The Department will not accept comments accompanied by a request that part or all of the material be treated confidentially because of its business proprietary nature or for any other reason. Any questions concerning file formatting, document conversion, access on the Internet, or other electronic filing issues should be addressed to Moustapha Sylla, Enforcement and Compliance, at (202) 482- 4685 or email address: [email protected]. FOR FURTHER INFORMATION CONTACT: Zachary Simmons at (202) 482-4044 or Abdelali Elouaradia at (202) 482-1374. SUPPLEMENTARY INFORMATION: Background In general terms, section 731 of the Tariff Act of 1930, as amended (the Act), provides that when a company is selling foreign merchandise in the United States at less than fair value, and the International Trade Commission determines that an industry is materially injured or threatened with material injury by reason of such sales or imports, the Department shall impose an antidumping duty. Furthermore, section 751 of the Act provides that the Department shall periodically review and determine, upon request, the amount of any antidumping duty. Pursuant to section 773(a) of the Act, the Department's analysis involves a comparison between a company's sales price to, or in, the United States (defined either as export price or constructed export price) with the normal value. See 19 CFR 351.401(a); see also section 772 of the Act (defining export price and constructed export price); section 773 of the Act (defining normal value). Although in most circumstances, sales in the exporting country provide the most appropriate basis for normal value, section 773 of the Act also permits the use of third country sales or constructed value as the basis for normal value. See also 19 CFR 351.404(a). The Department's regulations identify circumstances in which it may rely upon another basis for normal value. The Department may use a basis other than sales in the exporting country where, pursuant to 19 CFR 351.404(b), the Department determines that the exporting country does not constitute a viable market. 19 CFR 351.404(c). In addition, the Department may use a basis other than sales in the exporting country where a proper comparison between sales in the exporting country and sales in the United States is not possible. 19 CFR 351.404(c)(2)(i).\1\ --------------------------------------------------------------------------- \1\ The Department has exercised this discretion in the past. See, e.g., Large Newspaper Printing Presses and Components Thereof, Whether Assembled or Unassembled, from Japan, 65 FR 62700, 62702 (Dep't of Commerce Oct. 19, 2000) (prelim. results) (basing normal value on constructed value because ``the unique, custom-built nature of each LNPP sold does not permit proper price-to-price comparisons'') unchanged in Large Newspaper Printing Presses and Components Thereof, Whether Assembled or Unassembled, from Japan, 66 FR 11555 (Dep't of Commerce Feb. 26, 2001) (final results). --------------------------------------------------------------------------- In those circumstances where the Department determines that sales in the exporting country do not permit an appropriate comparison to United States sales, ``[t]he Secretary normally will calculate normal value based on sales to a third country rather than on constructed value if adequate information is available and verifiable . . .'' 19 CFR 351.404(f). Thus, although Sec. 404(f) of the Department's regulations contemplates both sales in a third country and constructed value as bases to calculate normal value, it establishes an order of preference in which the Department ``normally'' will use sales in a third country. Section 404(f) establishes sales in a third country as the preferred basis to calculate normal value where (1) there are no sales of the foreign like product in the exporting country, (2) there are insufficient sales of the foreign like product in the exporting country and thus the market is not viable, or (3) the Department has otherwise determined it cannot use such sales for purposes of determining normal value pursuant to section 773(a)(1)(B)(i) of the Act. However, the Department has identified some factors in favor of inverting the current order of preference to use, normally, constructed value rather than sales in a third country. First, the proposed preference for constructed value accords with the [[Page 58420]] TPEA, which amended section 773(b)(2) of the Act, regarding the importance of the cost of production in the Department's analysis of unfair trading behavior. Specifically, the TPEA amended section 773(b)(2) of the Act to require that the Department request cost information from individually examined respondent companies in antidumping proceedings. See Trade Preferences Extension Act of 2015, Public Law 114-27, 129 Stat. 362 (2015). As a consequence, the Department, in all segments of its antidumping duty proceedings for which the complete initial questionnaire was not issued as of August 6, 2015, now requires that parties provide cost of production information, which is necessary information for the use of constructed value. See Dates of Application of Amendments to the Antidumping and Countervailing Duty Laws Made by the Trade Preferences Extension Act of 2015, 80 FR 46793, 46794 (August 6, 2015). Therefore, obtaining constructed value information will not generally impose an additional burden upon the Department or respondent parties. By comparison, the Department would not necessarily already have requested the information necessary to calculate normal value based upon sales in a third country. Second, constructed value normally may be preferable to sales in a third country because it provides a more appropriate comparison to U.S. prices. Based upon the Department's experience, third country sales sometimes involve products that are similar, but not identical, to the products sold in the United States. See 19 CFR 351.404(e). However, as delineated under sections 773(e) and (f) of the Act, constructed value reflects the costs associated with the production and sale of the merchandise. Given the foregoing considerations, the Department is issuing this proposed rule to modify the regulations at issue pursuant to Administrative Procedure Act (5 U.S.C. 553) notice and comment procedures; the Department invites comments from all parties. Proposed Modification The Department proposes to modify 19 CFR 351.404(f) and 19 CFR 351.405(a) as indicated below. These modifications, if adopted, are intended to establish an order of preference in which, where the exporting country does not constitute a viable market, the Department normally will calculate normal value using constructed value. Although sales in a third country remain an appropriate basis for normal value in certain circumstances, constructed value would represent the approach ``normally'' used by the Department. Proposed Effective Date The Department proposes to make this rulemaking effective for segments of antidumping duty proceedings initiated on or after 30 days following the date of publication of the final rule. Comments The Department invites parties to comment on this proposed rule and the proposed effective date. Further, any party may submit comments expressing its disagreement with the Department's proposal and may propose an alternative approach. Classifications Executive Order 12866 It has been determined that this proposed rule is not significant for purposes of Executive Order 12866. Paperwork Reduction Act This proposed rule contains no new collection of information subject to the Paperwork Reduction Act, 44 U.S.C. chapter 35. Executive Order 13132 This proposed rule does not contain policies with federalism implications as that term is defined in section 1(a) of Executive Order 13132, dated August 4, 1999 (64 FR 43255 (August 10, 1999)). Regulatory Flexibility Act The Chief Counsel for Regulation has certified to the Chief Counsel for Advocacy of the Small Business Administration under the provisions of the Regulatory Flexibility Act, 5 U.S.C. 605(b), that the proposed rule would not have a significant economic impact on a substantial number of small business entities. The entities upon which this rulemaking could have an impact include foreign exporters and producers, some of whom are affiliated with U.S. companies, and U.S. importers. Enforcement & Compliance currently does not have information on the number of entities that would be considered small under the Small Business Administration's size standards for small businesses in the relevant industries. However, some of these entities may be considered small entities under the appropriate industry size standards. Although this proposed rule may indirectly impact small entities that are parties to individual antidumping duty proceedings, it will not have a significant economic impact on any entities. The proposed action alters the Department's approach in instances where the exporting country does not constitute a viable market or, pursuant to 19 CFR 351.404(c)(2), the Department declines to calculate normal value on the basis of exporting country sales. In particular, it would direct the Department normally to rely upon constructed value, rather than sales in a third country, as the basis for normal value. However, if the proposed rule is implemented, no entities would be required to undertake additional compliance measures or expenditures. Specifically, section 773(b)(2) of the Act now requires that the Department request cost of production information from each examined respondent in every segment of an antidumping duty proceeding. As a result, for those individually examined respondents whose exporting country is not viable or where the Department cannot otherwise use the sales in the exporting country, the Department will already have required submission of the information necessary to calculate normal value based upon constructed value, thus obviating the need to request information on sales in a viable third country. Therefore, the proposed rule would not have a significant economic impact upon a substantial number of small business entities. For this reason, an Initial Regulatory Flexibility Analysis is not required and one has not been prepared. List of Subjects in 19 CFR Part 351 Administrative practice and procedure, Antidumping, Business and industry, Cheese, Confidential business information, Countervailing duties, Freedom of information, Investigations, Reporting and recordkeeping requirements. Dated: August 19, 2016. Paul Piquado, Assistant Secretary for Enforcement and Compliance. For the reasons stated, 19 CFR part 351 is proposed to be amended as follows: PART 351--ANTIDUMPING AND COUNTERVAILING DUTIES 0 1. The authority citation for 19 CFR part 351 continues to read as follows: Authority: 5 U.S.C. 301; 19 U.S.C. 1202 note; 19 U.S.C. 1303 note; 19 U.S.C. 1671 et seq.; and 19 U.S.C. 3538. 0 2. In Sec. 351.404, revise paragraph (f) to read as follows: [[Page 58421]] Sec. 351.404 Selection of the market to be used as the basis for normal value. * * * * * (f) Constructed value and third country sales. The Secretary normally will calculate normal value based on constructed value (see section 773(a)(4) of the Act (Use of Constructed Value)) rather than on third country sales. 0 3. In Sec. 351.405, revise paragraph (a) to read as follows: Sec. 351.405 Calculation of normal value based on constructed value. (a) Introduction. In certain circumstances, the Secretary may determine normal value by constructing a value based on the cost of manufacture, selling general and administrative expenses, and profit. The Secretary may use constructed value as the basis for normal value where: The exporting country is not viable; sales below the cost of production are disregarded; sales outside the ordinary course of trade, or sales the prices of which are otherwise unrepresentative, are disregarded; sales used to establish a fictitious market are disregarded; no contemporaneous sales of comparable merchandise are available; or in other circumstances where the Secretary determines that exporting country sales are inappropriate. (See section 773(e) and section 773(f) of the Act.) This section clarifies the meaning of certain terms relating to constructed value. * * * * * [FR Doc. 2016-20417 Filed 8-24-16; 8:45 am] BILLING CODE 3510-DS-P
![Federal Register / Vol. 81, No. 165 / Thursday, August 25, 2016 / Proposed Rules 58419
That airspace extending upward from 700 not have access to the internet. country provide the most appropriate
feet above the surface within a 6.6-mile Commenters that do not have access to basis for normal value, section 773 of
radius of Winters Municipal Airport, and 1 the internet may submit the original and the Act also permits the use of third
mile each side of the 352° bearing from the one electronic copy on CD–ROM of each country sales or constructed value as the
airport extending from the 6.6-mile radius to
9.3 miles north of the airport, and within 2
set of comments by mail or hand basis for normal value. See also 19 CFR
miles each side of the 180° bearing from the delivery/courier. All comments should 351.404(a).
airport from the 6.6-mile radius to 9.6 miles be addressed to Paul Piquado, Assistant The Department’s regulations identify
south of the airport. Secretary for Enforcement & circumstances in which it may rely
Compliance, Room 1870, Department of upon another basis for normal value.
Issued in Fort Worth, Texas, on August 17,
Commerce, 14th Street and Constitution The Department may use a basis other
2016.
Ave. NW., Washington, DC 20230. than sales in the exporting country
Christopher L. Southerland,
Comments submitted to the Department where, pursuant to 19 CFR 351.404(b),
Acting Manager, Operations Support Group, the Department determines that the
ATO Central Service Center.
will be uploaded to the eRulemaking
Portal at www.Regulations.gov. exporting country does not constitute a
[FR Doc. 2016–20152 Filed 8–24–16; 8:45 am] viable market. 19 CFR 351.404(c). In
The Department will consider all
BILLING CODE 4910–13–P
comments received before the close of addition, the Department may use a
the comment period. All comments basis other than sales in the exporting
responding to this notice will be a country where a proper comparison
DEPARTMENT OF COMMERCE matter of public record and will be between sales in the exporting country
available on the Federal eRulemaking and sales in the United States is not
International Trade Administration possible. 19 CFR 351.404(c)(2)(i).1
Portal at www.Regulations.gov. The
Department will not accept comments In those circumstances where the
19 CFR Part 351 Department determines that sales in the
accompanied by a request that part or
[Docket Number 160815742–6742–01] all of the material be treated exporting country do not permit an
confidentially because of its business appropriate comparison to United States
RIN 0625–AB08 sales, ‘‘[t]he Secretary normally will
proprietary nature or for any other
reason. calculate normal value based on sales to
Modification of Regulations Regarding
Any questions concerning file a third country rather than on
Basis for Normal Value
formatting, document conversion, constructed value if adequate
AGENCY: Enforcement and Compliance, access on the Internet, or other information is available and verifiable
International Trade Administration, electronic filing issues should be . . .’’ 19 CFR 351.404(f). Thus, although
Department of Commerce. addressed to Moustapha Sylla, § 404(f) of the Department’s regulations
ACTION: Proposed rule and request for Enforcement and Compliance, at (202) contemplates both sales in a third
comments. 482–4685 or email address: webmaster- country and constructed value as bases
support@ita.doc.gov. to calculate normal value, it establishes
SUMMARY: The Department of Commerce FOR FURTHER INFORMATION CONTACT:
an order of preference in which the
(‘‘the Department’’) proposes to modify Zachary Simmons at (202) 482–4044 or Department ‘‘normally’’ will use sales in
the regulations pertaining to the use of Abdelali Elouaradia at (202) 482–1374. a third country. Section 404(f)
constructed value or third country sales establishes sales in a third country as
SUPPLEMENTARY INFORMATION:
for purposes of determining normal the preferred basis to calculate normal
value, where the exporting country does Background value where (1) there are no sales of the
not constitute a viable market, and is foreign like product in the exporting
In general terms, section 731 of the
seeking comments from parties. This country, (2) there are insufficient sales
Tariff Act of 1930, as amended (the Act),
modification, if adopted, will specify of the foreign like product in the
provides that when a company is selling
that, where the exporting country does exporting country and thus the market
foreign merchandise in the United
not constitute a viable market, the is not viable, or (3) the Department has
States at less than fair value, and the
Department normally will calculate otherwise determined it cannot use such
International Trade Commission
normal value based upon constructed sales for purposes of determining
determines that an industry is
value. This modification would invert normal value pursuant to section
materially injured or threatened with
the preexisting order of preference that, 773(a)(1)(B)(i) of the Act.
material injury by reason of such sales However, the Department has
where the exporting country does not or imports, the Department shall impose
constitute a viable market, the identified some factors in favor of
an antidumping duty. Furthermore, inverting the current order of preference
Department normally calculates normal section 751 of the Act provides that the
value based on sales in a viable third to use, normally, constructed value
Department shall periodically review rather than sales in a third country.
country. The Department proposes this and determine, upon request, the
modification in light of certain First, the proposed preference for
amount of any antidumping duty. constructed value accords with the
advantages of constructed value over Pursuant to section 773(a) of the Act,
third country sales, such as availability the Department’s analysis involves a 1 The Department has exercised this discretion in
of cost of production information and comparison between a company’s sales the past. See, e.g., Large Newspaper Printing Presses
comparability to U.S. prices. price to, or in, the United States and Components Thereof, Whether Assembled or
DATES: To be assured of consideration, (defined either as export price or Unassembled, from Japan, 65 FR 62700, 62702
Lhorne on DSK30JT082PROD with PROPOSALS
written comments must be received no (Dep’t of Commerce Oct. 19, 2000) (prelim. results)
constructed export price) with the (basing normal value on constructed value because
later than September 26, 2016. normal value. See 19 CFR 351.401(a); ‘‘the unique, custom-built nature of each LNPP sold
ADDRESSES: All comments must be see also section 772 of the Act (defining does not permit proper price-to-price
submitted through the Federal export price and constructed export comparisons’’) unchanged in Large Newspaper
Printing Presses and Components Thereof, Whether
eRulemaking Portal at http:// price); section 773 of the Act (defining Assembled or Unassembled, from Japan, 66 FR
www.regulations.gov, Docket No. ITA– normal value). Although in most 11555 (Dep’t of Commerce Feb. 26, 2001) (final
2016–0009, unless the commenter does circumstances, sales in the exporting results).
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![Federal Register / Vol. 81, No. 165 / Thursday, August 25, 2016 / Proposed Rules 58421
§ 351.404 Selection of the market to be finalized, will help food establishments and Drug Administration, 5630 Fishers
used as the basis for normal value. determine whether the activities that Lane, Rm. 1061, Rockville, MD 20852.
* * * * * they perform are within the ‘‘farm’’ • For written/paper comments
(f) Constructed value and third definition established in our regulation submitted to the Division of Dockets
country sales. The Secretary normally for Registration of Food Facilities. Management, FDA will post your
will calculate normal value based on Determining whether the activities a comment, as well as any attachments,
constructed value (see section 773(a)(4) food establishment performs are within except for information submitted,
of the Act (Use of Constructed Value)) the ‘‘farm’’ definition plays a key role in marked and identified, as confidential,
rather than on third country sales. determining whether its business is if submitted as detailed in
■ 3. In § 351.405, revise paragraph (a) to exempt from our regulations for ‘‘Instructions.’’
read as follows: Registration of Food Facilities, and from Instructions: All submissions received
certain requirements in our regulations must include the Docket No. FDA–
§ 351.405 Calculation of normal value 2016–D–2373 for ‘‘Classification of
based on constructed value. for ‘‘Current Good Manufacturing
Practice, Hazard Analysis, and Risk- Activities as Harvesting, Packing,
(a) Introduction. In certain Holding, or Manufacturing/Processing
Based Preventive Controls for Human
circumstances, the Secretary may for Farms and Facilities; Draft Guidance
Food’’ and ‘‘Current Good
determine normal value by constructing for Industry.’’ Received comments will
Manufacturing Practice, Hazard
a value based on the cost of be placed in the docket and, except for
Analysis, and Risk-Based Preventive
manufacture, selling general and those submitted as ‘‘Confidential
Controls for Food for Animals.’’
administrative expenses, and profit. The Submissions,’’ publicly viewable at
Secretary may use constructed value as DATES: Although you can comment on
http://www.regulations.gov or at the
the basis for normal value where: The any guidance at any time (see 21 CFR Division of Dockets Management
exporting country is not viable; sales 10.115(g)(5)), to ensure that we consider between 9 a.m. and 4 p.m., Monday
below the cost of production are your comment on the draft guidance through Friday.
disregarded; sales outside the ordinary before we begin work on the final • Confidential Submissions—To
course of trade, or sales the prices of version of the guidance, submit either submit a comment with confidential
which are otherwise unrepresentative, electronic or written comments on the information that you do not wish to be
are disregarded; sales used to establish draft guidance by February 21, 2017. made publicly available, submit your
a fictitious market are disregarded; no ADDRESSES: You may submit comments comments only as a written/paper
contemporaneous sales of comparable as follows: submission. You should submit two
merchandise are available; or in other Electronic Submissions copies total. One copy will include the
circumstances where the Secretary information you claim to be confidential
determines that exporting country sales Submit electronic comments in the with a heading or cover note that states
are inappropriate. (See section 773(e) following way: ‘‘THIS DOCUMENT CONTAINS
and section 773(f) of the Act.) This • Federal eRulemaking Portal: http:// CONFIDENTIAL INFORMATION.’’ The
section clarifies the meaning of certain www.regulations.gov. Follow the Agency will review this copy, including
terms relating to constructed value. instructions for submitting comments. the claimed confidential information, in
* * * * * Comments submitted electronically, its consideration of comments. The
[FR Doc. 2016–20417 Filed 8–24–16; 8:45 am] including attachments, to http:// second copy, which will have the
BILLING CODE 3510–DS–P
www.regulations.gov will be posted to claimed confidential information
the docket unchanged. Because your redacted/blacked out, will be available
comment will be made public, you are for public viewing and posted on http://
solely responsible for ensuring that your www.regulations.gov. Submit both
DEPARTMENT OF HEALTH AND
comment does not include any copies to the Division of Dockets
HUMAN SERVICES
confidential information that you or a Management. If you do not wish your
Food and Drug Administration third party may not wish to be posted, name and contact information to be
such as medical information, your or made publicly available, you can
21 CFR Parts 117 and 507 anyone else’s Social Security number, or provide this information on the cover
confidential business information, such sheet and not in the body of your
[Docket No. FDA–2016–D–2373] as a manufacturing process. Please note comments and you must identify this
that if you include your name, contact information as ‘‘confidential.’’ Any
Classification of Activities as information, or other information that information marked as ‘‘confidential’’
Harvesting, Packing, Holding, or identifies you in the body of your will not be disclosed except in
Manufacturing/Processing for Farms comments, that information will be accordance with 21 CFR 10.20 and other
and Facilities; Draft Guidance for posted on http://www.regulations.gov. applicable disclosure law. For more
Industry; Availability • If you want to submit a comment information about FDA’s posting of
AGENCY: Food and Drug Administration, with confidential information that you comments to public dockets, see 80 FR
HHS. do not wish to be made available to the 56469, September 18, 2015, or access
ACTION: Notification of availability. public, submit the comment as a the information at: http://www.fda.gov/
written/paper submission and in the regulatoryinformation/dockets/
SUMMARY: The Food and Drug manner detailed (see ‘‘Written/Paper default.htm.
Administration (FDA or we) is Submissions’’ and ‘‘Instructions’’). Docket: For access to the docket to
Lhorne on DSK30JT082PROD with PROPOSALS
announcing the availability of a draft read background documents or the
guidance for industry entitled Written/Paper Submissions electronic and written/paper comments
‘‘Classification of Activities as Submit written/paper submissions as received, go to http://
Harvesting, Packing, Holding, or follows: www.regulations.gov and insert the
Manufacturing/Processing for Farms • Mail/Hand delivery/Courier (for docket number, found in brackets in the
and Facilities; Draft Guidance for written/paper submissions): Division of heading of this document, into the
Industry.’’ The draft guidance, when Dockets Management (HFA–305), Food ‘‘Search’’ box and follow the prompts
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Document Created: 2016-08-25 00:34:33
Document Modified: 2016-08-25 00:34:33
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Proposed Rules | |
| Action | Proposed rule and request for comments. | |
| Dates | To be assured of consideration, written comments must be received no later than September 26, 2016. | |
| Contact | Zachary Simmons at (202) 482-4044 or Abdelali Elouaradia at (202) 482-1374. | |
| FR Citation | 81 FR 58419 | |
| RIN Number | 0625-AB08 | |
| CFR Associated | Administrative Practice and Procedure; Antidumping; Business and Industry; Cheese; Confidential Business Information; Countervailing Duties; Freedom of Information; Investigations and Reporting and Recordkeeping Requirements |
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