Fresh and Chilled Atlantic Salmon From Norway, Preliminary Results of Antidumping Duty Administrative Review

DEPARTMENT OF COMMERCE

[A-403-801]

Fresh and Chilled Atlantic Salmon From Norway, Preliminary

Results of Antidumping Duty Administrative Review

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of preliminary results of antidumping duty

administrative review.

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

SUMMARY: In response to requests by three respondents and the

petitioner, The Coalition for Fair Atlantic Salmon Trade (FAST), the

Department of Commerce (the Department) has conducted an administrative

review of the antidumping duty order on fresh and chilled Atlantic

salmon (salmon) from Norway. The review covers 24 exporters, and the

period April 1, 1993, through March 31, 1994.

We preliminarily determined that sales have been made below the

foreign market value (FMV). If these preliminary results are adopted in

our final results of administrative review, we will instruct U.S.

Customs to assess antidumpting duties equal to the difference between

the United States price (USP) and the FMV.

Interested parties are invited to comment on these preliminary

results. Parties who submit arguments in this proceeding are requested

to submit with the argument (1) a statement of the issue, and (2) a

brief summary of the argument.

EFFECTIVE DATE: September 26, 1995.

FOR FURTHER INFORMATION CONTACT:

Todd Peterson or Thomas Futtner, Office of Antidumping Compliance,

Import Administration, International Trade Administration, U.S.

Department of Commerce, 14th Street and Constitution Avenue, N.W.,

Washington, D.C. 20230; telephone (202) 482-4195 or 482-3814,

respectively.

Applicable Statute and Regulations

The Department is conducting this review in accordance with section

751(a) of the Tariff Act of 1930, as amended (the Act). Unless

otherwise indicated, all citations to the statute and to the

Department's regulations are in reference to the provisions as they

existed on December 31, 1994.

[[Page 49580]]

SUPPLEMENTARY INFORMATION:

Background

On April 12, 1991, the Department published the antidumping duty

order on salmon from Norway (56 FR 14920). The Department published a

notice of ``Opportunity to Request Administrative Review'' on April 7,

1994 (59 FR 16615). On April 29, 1994, the petitioner, FAST, requested

that we conduct an administrative review of 24 exporters, listed below,

for the period April 1, 1993, through March 31, 1994. On April 29,

1994, three respondents asked to be reviewed: Norwegian Salmon A/S,

Hallvard Leroy A/S, and Mowi A/S. We published a notice of ``Initiation

of Antidumping and Countervailing Duty Administrative Review'' on May

12, 1994 (59 FR 24683). On June 29, 1994, the Department received

timely requests from Hallvard Leroy A/S and Mowi A/S for withdrawal

from this administrative review. In accordance with 19 CFR

353.22(a)(5), the Department terminated the review for Hallvard Leroy

A/S, and Mowi A/S on September 16, 1994 (59 FR 47610).

Scope of the Review

The merchandise covered by this review is fresh and chilled

Atlantic salmon (salmon). It encompasses the species of Atlantic salmon

(Salmo salar) marketed as specified herein; the subject merchandise

excludes all other species of salmon: Danube salmon; Chinook (also

called ``king'' or ``quinnat''); Coho (``silver''); Sockeye

(``redfish'' or ``blueback''); Humpback (``pink''); and Chum (``dog'').

Atlantic salmon is whole or nearly whole fish, typically (but not

necessarily) marketed gutted, bled, and cleaned, with the head on. The

subject merchandise is typically packed in fresh water ice (chilled).

Excluded from the subject merchandise are fillets, steaks, and other

cuts of Atlantic salmon. Also excluded are frozen, canned, smoked or

otherwise processed Atlantic salmon. Fresh and chilled Atlantic salmon

is currently provided for under Harmonized Tariff Schedule (HTS)

subheading 0302.12.00.02.09. The HTS item number is provided for

convenience and Customs purposes. The written description remains

dispositive as to the scope of the product coverage. This review covers

24 manufacturers/exporters and the period of review is April 1, 1993

through March 31, 1994.

No Shipments

There were 17 firms that reported they made no shipments of the

subject merchandise during the period of review, which was verified

with the U.S. Customs Service. The two firms which had not been

reviewed previously will receive the ``all other rate'' of 23.80

percent. The 15 previously reviewed firms will continue to receive

their current rates.

Best Information Available

Five exporters failed to respond to our questionnaire. Therefore,

we based the margins for these firms on the best information otherwise

available. In determining what to use as BIA, the Department uses the

following two-tier hierarchy to separate cooperative firms from non-

cooperative firms (see Final Results of Antidumping Administrative

Review of Antifriction Bearings and Parts Thereof from France, et al.,

58 FR 39739, July 26, 1993):

1. When a company refuses to cooperate with the Department or

otherwise significantly impedes these proceedings, we use as BIA the

higher of (1) the highest of the rates found for any firm for the

same class or kind of merchandise in the same country of origin in

the LTFV investigation or prior administrative reviews; or (2) the

highest rate found in this review for any firm for the same class or

kind of merchandise in the same country of origin.

2. When a company substantially cooperates with our requests for

information and, substantially cooperates in verification, but fails

to provide the information requested in a timely manner or in the

form required, or was unable to substantiate it, we used as BIA the

higher of (1) the highest rate ever applicable to the firm for the

same class or kind of merchandise from either the LTFV investigation

or a prior administrative review or if the firm has never before

been investigated or reviewed, the all others rate from the LTFV

investigation; or (2) the highest calculated rate in this review for

the class or kind of merchandise for any firm from the same country

of origin.

We used first-tier BIA for five exporters, Artic Group, Fresh

Marine Co. Ltd., Greig Norwegian Salmon, Norwegian Taste Company, and

Victoria Seafood, which failed to respond to the Department's

questionnaires. The rate we used was 31.81 percent, the highest rate

from the less-than-fair-value (LTFV) investigation.

United States Price

In accordance with section 772(b) of the Act, the Department based

USP on purchase price, because the merchandise was sold to unrelated

U.S. purchasers prior to importation.

Purchase price is based on airpacked, c.i.f. prices to unrelated

customers in the United States. We made adjustments, where applicable,

for air freight, foreign inland freight, inland/marine insurance and

Norwegian export duties. No other adjustments were claimed or allowed.

Foreign Market Value

In accordance with section 773(a) of the Act, the Department

determined that home market sales did not constitute a viable market

for calculating FMV. Therefore, in accordance with 19 CFR 353.49(b) of

the Department's regulations, the Department chose sales to France as

the basis of FMV. France is the largest third country market with

merchandise most similar to that sold in the United States, based on

information submitted by both Skaarfish and Norwegian Salmon. Because

Skaarfish and Norwegian Salmon were found to have made sales at prices

below the cost of production (COP) during the investigation, and in the

first administrative review with respect to Skaarfish, the Department

initiated a COP investigation for both companies in this administrative

review. See memo to Holly A. Kuga from Laurie A. Lucksinger, June 21,

1994, on the record found in room B-099 at the Department.

In comparing third-country sales to COP, we used the production

costs incurred by the fish farmers, the actual producers of the subject

merchandise, to calculate the COP benchmark. The statute is concerned

specifically with the cost of production of the merchandise, and

Skaarfish and Norwegian Salmon do not produce the salmon that each

sells. Department practice in such situations is to compare the

production costs of the producer, in this case, the fishfarmers, plus

the producer's selling, general and administrative expenses (SG&A),

plus the SG&A of the seller (Skaarfish or Norwegian Salmon), to the

seller's home market/third country sales to determine whether home

market/third country sales were made below the COP. See Final

Determination of Sales at less Than Fair Value: Fresh and Chilled

Atlantic Salmon from Norway 56 FR 7661 (February 25, 1991); Final

Results of Antidumping Duty Administrative Reviews: Oil Country Tubular

Goods from Canada 56 FR 38408 (August 13, 1991 .

Sampling

Since there were approximately 50 salmon farmers that supplied

Skaarfish during the period of review, the Department determined that

sampling was both administratively necessary and methodologically

appropriate to calculate a representative cost of producing the subject

merchandise for purposes of this administrative review. Pursuant to

Section 777A of the Act, on September 23, 1994, the Department issued a

memorandum recommending the use of sampling. Based on comments

[[Page 49581]]

submitted by the petitioner and respondent, the Department determined

that the most significant factor influencing the costs of producing

salmon is farm location. We allocated the same across regions on the

basis of each region's share of Skaarfish's total purchase during the

POR.

To sample farms from each region, we assigned each farm points

according to its percentage share of total volume of sales to

Skaarfish. We used unequal selection probabilities because we are

estimating a volume weighted-average of farm-specific costs. First, we

assigned each farm points according to that farm's weighted-average

percentage of sales volume to Skaarfish. One point was given for each

\1/2\ percent of sales to Skaarfish. Each farm was represented in the

sample pool in proportion to the number of points it received. For

example, a farm that comprised 25 percent of sales to Skaarfish would

receive 50 points. In this way, the farm with a greater volume of sales

had a greater likelihood of being selected than the farm with a smaller

volume of sales to Skaarfish.

From the 50 farms, we made two selections from the northern region

and thirteen selections from the southern region for a total of 15

selections. Of the 15 selections, two farms were chosen twice and one

farm was chosen three times. We used a simple average for calculating

the costs of the sample pool because we weighted each farm according to

its share of sales to Skaarfish in selecting the sampled farms.

When a farm received a BIA rate as its COP, we did not exclude it

from the sample pool. The elimination of non-responding farms from the

sample would reward non-responding farms and could encourage non-

compliance in future reviews. Moreover, it would impair the integrity

of the sample because it would detract from the randomness of the

results.

Since only nine fish farmers supplied respondent Norwegian Salmon

during the POR, the Department determined that sampling was unnecessary

for this firm. We sent COP questionnaires through Norwegian Salmon to

all nine salmon farmers, three of which responded. Similarly, we sent

COP questionnaires through Skaarfish to its eleven salmon farmers that

were selected in our sample, seven of which responded. These responses,

along with deficiency responses and verification results, were analyzed

and relied upon in reaching these preliminary results of review.

We calculated the COP for each farm by summing all costs for the

1992 generation salmon. These costs include smolt, feed, labor, and

overhead. We allocated these costs on a per kilogram basis over net

production quantities. We then adjusted those costs to reflect losses

in the processing stage. General and administrative expenses and net

interest expenses incurred for the sale of salmon in 1993 were

allocated to the salmon sold during the period of review.

Based on information gathered at verification we adjusted the

farmers' data as appropriate.

For the farms that did not respond to the questionnaire, we used

best information available (BIA) to determine their COP. This BIA was

based on the highest COP we calculated for the responding farms

supplying each exporter.

We calculated, for each exporter, a simple average COP of their

farmers' individual COPs. We then added that exporter's selling and

general and administrative expenses to the simple-averaged farmer COP.

We calculated the total COP on a Norwegian Kroner per-kilogram basis.

Cost Test Results

Third country prices were compared to the calculated COP. We

adjusted third country prices to reflect deductions for foreign inland

freight, inland/marine insurance, third-country market credit,

Norweigian export duties, brokerage and handling, freight, third-

country market import duties, and third-country market warranties.

Because there were no commissions in the third-country, we deducted

indirect selling expenses in amounts not exceeding U.S. commissions. We

determined that between 10 and 90 percent of sales of both firms were

made at prices below total COP and over an extended period of time.

Therefore, we disregarded those sales made below cost and compared the

FMV of the remaining sales to the U.S. price.

Preliminary Results of Review

We have preliminarily determined that the following margins exist

for the period April 1, 1993, through May 31, 1994:

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

Percent

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

ABA A/S....................................................... \1\ 31.8

1

Artic Group................................................... \2\ 31.8

1

Artic Products Norway A/S..................................... \1\ 31.8

1

Brodrene Sirevag A/S.......................................... \1\ 23.8

0

Cocoon Ltd A/S................................................ \1\ 31.8

1

Delfa Norge A/S............................................... \1\ 31.8

1

Delimar A/S................................................... (\3\)

Deli-Nor A/S.................................................. (\3\)

Fjord Trading Ltd. A/S........................................ \1\ 23.8

0

Fresh Marine Co. Ltd.......................................... \1\ 31.8

1

Greig Norwegian Salmon........................................ \2\ 31.8

1

Harald Mowinckel A/S.......................................... \1\ 23.8

0

Imperator de Norvegia......................................... \1\ 31.8

1

More Seafood A/S.............................................. \1\ 31.8

1

Nils Willksen A/S............................................. \1\ 31.8

1

North Cape Fish A/S........................................... \1\ 31.8

1

Norwegian Salmon A/S.......................................... 3.07

Norwegian Taste Company A/S................................... \2\ 31.8

1

Olsen & Kvalheim A/S.......................................... \1\ 23.8

0

Sekkingstad A/S............................................... \1\ 23.8

0

Skaarfish-Mowi A/S............................................ 1.58

Timar Seafood A/S............................................. \1\ 31.8

1

Victoria Seafood A/S.......................................... \2\ 31.8

1

West Fish Ltd. A/S............................................ \1\ 23.8

0

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\1\ No shipments during the period; margin from the last administrative

review.

\2\ No response; highest margin from the original LTFV investigation.

\3\ No shipments or sales subject to this review. The firm had no

individual rate from any segment of this proceeding, so we are

applying the all others rate from the LTFV investigation.

The Department shall determine, and the Customs Service shall

assess, antidumping duties on all appropriate entries. Upon completion

of this review, the Department will issue appraisement instructions

concerning all respondents directly to the U.S. Customs Service.

Furthermore, the following deposit requirements will be effective

for all shipments of the subject merchandise, entered, or withdrawn

from warehouse, for consumption on or after the publication date of the

final results of this administrative review, as provided for by section

751(a)(1) of the Tariff Act: (1) The cash deposit rate for the reviewed

firms will be each firm's rate as established in the final results of

this administrative review; (2) for previously reviewed or investigated

companies not listed above, the cash deposit rate will continue to be

the company-specific rate published for the most recent period; (3) if

the exporter is not a firm covered in this review, or the original LTFV

investigation, but the manufacturer is, the cash deposit rate will be

the rate established for the most recent period for the manufacturer of

the merchandise; and (4) the cash deposit rate for all other

manufacturers or exporters not previously reviewed will be 23.80

percent, the all other rate from the LTFV investigation.

These deposit requirements, when imposed, shall remain in effect

until publication of the final results of the next administrative

review.

Interested parties may request disclosure within five days of the

date of publication of this notice, and may request a hearing within 10

days of the date of publication. Any hearing, if requested, will be

held as early as convenient for the parties but not later than 44 days

after the date of

[[Page 49582]]

publication, or the first workday thereafter. Case briefs or other

written comments, from interested parties may be submitted not later

than 30 days after the date of publication of this notice. Rebuttal

briefs and rebuttal comments, limited to issues raised in the case

briefs, may be filed not later than 37 days after the date of

publication. The Department will publish the final results of review,

including the results of its analysis of issues raised in any such

written comments or hearing.

This notice serves as a preliminary reminder to importers of their

responsibility under 19 CFR 353.26 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 notice are in accordance with

section 751(a)(1) of the Tariff Act (19 U.S.C. 1675(a)(1)) and 19 CFR

353.22.

Dated: September 15, 1995.

Susan G. Esserman,

Assistant Secretary for Import Administration.

[FR Doc. 95-23792 Filed 9-25-95; 8:45 am]

BILLING CODE 3510-DS-M