Frozen Warmwater Shrimp From Ecuador: Preliminary Affirmative Countervailing Duty Determination, and Alignment of Final Determination With the Final Antidumping Duty Determination

<NOTICE> DEPARTMENT OF COMMERCE <SUBAGY>International Trade Administration</SUBAGY> <DEPDOC>[C-331-806]</DEPDOC> <SUBJECT>Frozen Warmwater Shrimp From Ecuador: Preliminary Affirmative Countervailing Duty Determination, and Alignment of Final Determination With the Final Antidumping Duty Determination</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Enforcement and Compliance, International Trade Administration, Department of Commerce. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The U.S. Department of Commerce (Commerce) preliminarily determines that countervailable subsidies are being provided to producers and exporters of frozen warmwater shrimp (shrimp) from Ecuador. The period of investigation (POI) is January 1, 2022, through December 31, 2022. Interested parties are invited to comment on this preliminary determination. </SUM> <DATES> <HD SOURCE="HED">DATES:</HD> Applicable April 1, 2024. </DATES> <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Reginald Anadio or Zachary Shaykin, AD/CVD Operations, Office IV, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW, Washington, DC 20230; telephone: (202) 482-3166 or (202) 482-5377, respectively. </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">Background</HD> This preliminary determination is made in accordance with section 703(b) of the Tariff Act of 1930, as amended (the Act). On November 21, 2023, Commerce published in the <E T="04">Federal Register</E> the notice of initiation of this investigation. <SU>1</SU> <FTREF/> On December 7, 2023, Commerce postponed the preliminary determination until March 25, 2024. <SU>2</SU> <FTREF/> <FTNT> <SU>1</SU>   <E T="03">See Frozen Warmwater Shrimp from Ecuador, India, Indonesia, and the Socialist Republic of Vietnam: Initiation of Countervailing Duty Investigations,</E> 88 FR 81053 (November 21, 2023) ( <E T="03">Initiation Notice</E> ). </FTNT> <FTNT> <SU>2</SU>   <E T="03"> See Frozen Warmwater Shrimp from Ecuador, India, Indonesia, and the Socialist Republic of Vietnam: Postponement of Preliminary Determinations in the Countervailing Duty Investigations, </E> 88 FR 85216 (December 7, 2023). </FTNT> For a complete description of events that followed the initiation of this investigation, <E T="03">see</E> the Preliminary Decision Memorandum. <SU>3</SU> <FTREF/> A list of topics discussed in the Preliminary Decision Memorandum is included as Appendix II to this notice. The Preliminary Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). ACCESS is available to registered users at <E T="03">https://access.trade.gov.</E> In addition, a complete version of the Preliminary Decision Memorandum can be accessed directly at <E T="03">https://access.trade.gov/public/FRNoticesListLayout.aspx.</E> <FTNT> <SU>3</SU>   <E T="03">See</E> Memorandum, “Decision Memorandum for the Preliminary Affirmative Determination of the Countervailing Duty Investigation of frozen warmwater shrimp from Ecuador,” dated concurrently with, and hereby adopted by, this notice (Preliminary Decision Memorandum). </FTNT> <HD SOURCE="HD1">Scope of the Investigation</HD> The product covered by this investigation is shrimp from Ecuador. For a complete description of the scope of this investigation, <E T="03">see</E> Appendix I. <HD SOURCE="HD1">Scope Comments</HD> In accordance with the <E T="03">Preamble</E> to Commerce's regulations, <SU>4</SU> <FTREF/> in the <E T="03">Initiation Notice</E> Commerce set aside a period of time for parties to raise issues regarding product coverage ( <E T="03">i.e.,</E> scope). <SU>5</SU> <FTREF/> No interested party commented on the scope of the investigation as it appeared in the <E T="03">Initiation Notice.</E> <FTNT> <SU>4</SU>   <E T="03">See Antidumping Duties; Countervailing Duties, Final Rule,</E> 62 FR 27296, 27323 (May 19, 1997) ( <E T="03">Preamble</E> ). </FTNT> <FTNT> <SU>5</SU>   <E T="03">See Initiation Notice,</E> 88 FR at 81054. </FTNT> <HD SOURCE="HD1">Methodology</HD> Commerce is conducting this investigation in accordance with section 701 of the Act. For each subsidy program found to be countervailable, Commerce preliminarily determines that there is a subsidy, <E T="03">i.e.,</E> a financial contribution by an “authority” that gives rise to a benefit to the recipient, and that the subsidy is specific. <SU>6</SU> <FTREF/> For a full description of the methodology underlying our preliminary determination, <E T="03">see</E> the Preliminary Decision Memorandum. <FTNT> <SU>6</SU>   <E T="03">See</E> sections 771(5)(B) and (D) of the Act regarding financial contribution; section 771(5)(E) of the Act regarding benefit; and section 771(5A) of the Act regarding specificity. </FTNT> <HD SOURCE="HD1">Alignment</HD> As noted in the Preliminary Decision Memorandum, in accordance with section 705(a)(1) of the Act and 19 CFR 351.210(b)(4), Commerce is aligning the final countervailing duty (CVD) determination in this investigation with the final determinations in the companion antidumping duty (AD) investigations of shrimp from Ecuador and Indonesia, based on a request made by the petitioner. <SU>7</SU> <FTREF/> Consequently, the final CVD determination will be issued on the same date as the final AD determinations, which are currently scheduled to be issued no later than August 5, 2024, unless postponed. <FTNT> <SU>7</SU>   <E T="03">See</E> Petitioner's Letter, “Request to Alignment,” dated February 22, 2024. The petitioner is the American Shrimp Processors Association. </FTNT> <HD SOURCE="HD1">All-Others Rate</HD> Sections 703(d) and 705(c)(5)(A) of the Act provide that, in the preliminary determination, Commerce shall determine an estimated all-others rate for companies not individually examined. This rate shall be an amount equal to the weighted average of the estimated subsidy rates established for those companies individually examined, excluding any zero and <E T="03">de minimis</E> rates and any rates based entirely under section 776 of the Act. In this investigation, Commerce preliminarily calculated total net subsidy rates for Industrial Pesquera Santa Priscila S.A. (Santa Priscila) and Sociedad Nacional de Galapagos C.A. (SONGA) that are not zero, <E T="03">de minimis,</E> or based entirely on the facts otherwise available. Because Commerce calculated individual estimated countervailable subsidy rates for Santa Priscila and SONGA that are not zero, <E T="03">de minimis,</E> or based entirely on the facts otherwise available, we have preliminarily calculated the all-others rate using a simple average of the individual estimated subsidy rates calculated for the examined respondents. <SU>8</SU> <FTREF/> <FTNT> <SU>8</SU>  When two respondents are under examination, Commerce normally calculates (A) a weighted-average of the estimated subsidy rates calculated for the examined respondents using each company's proprietary U.S. sale quantities for the merchandise under consideration; (B) a simple average of the estimated subsidy rates calculated for the examined respondents; and (C) a weighted-average of the estimated subsidy rates calculated for the examined respondents using each company's publicly-ranged U.S. sale quantities for the merchandise under consideration. Commerce then compares (B) and (C) to (A) and selects the rate closest to (A) as the most appropriate rate for all other producers and exporters. <E T="03">See, e.g., Ball Bearings and Parts Thereof from France, Germany, Italy, Japan, and the United Kingdom: Final Results of Antidumping Duty Administrative Reviews, Final Results of Changed-Circumstances Review, and Revocation of an Order in Part,</E> 75 FR 53661, 53663 (September 1, 2010). We currently do not have on the record the necessary publicly-ranged sales data to conduct the rate comparison discussed above. Therefore, for purposes of the preliminary determination, we calculated the all-others rate as the simple average of the total net subsidy rates calculated for the two mandatory respondents. We will solicit the necessary publicly-ranged sales data after the issuance of the preliminary determination. </FTNT> <HD SOURCE="HD1">Preliminary Determination</HD> Commerce preliminarily determines that the following estimated countervailable subsidy rates exist: <GPOTABLE COLS="2" OPTS="L2,nj,tp0,i1" CDEF="s50,12"> <TTITLE> </TTITLE> <CHED H="1">Producer/exporter</CHED> <CHED H="1"> Subsidy rate (percent <E T="03">ad valorem</E> Industrial Pesquera Santa Priscila S.A. <SU>9</SU> </ENT> <ENT>13.41</ENT> </ROW> <ROW> <ENT I="01"> Sociedad Nacional de Galapagos C.A. <SU>10</SU> </ENT> <ENT>1.69</ENT> </ROW> <ROW> <ENT I="01">All Others</ENT> <ENT>7.55</ENT> </ROW> </GPOTABLE> <HD SOURCE="HD1"> Suspension of Liquidation  As discussed in the Preliminary Decision Memorandum, Commerce preliminarily determines Industrial Pesquera Santa Priscila S.A. is cross-owned with Manesil S.A., Produmar S.A., Tropack S.A., and Egidiosa S.A. <SU>10</SU>  As discussed in the Preliminary Decision Memorandum, Commerce preliminarily determines Sociedad Nacional de Galapagos C.A. is cross-owned with Naturisa S.A., Holding Sola & Sola Solacciones S.A., and Empacadora Champmar S.A. </FTNT> In accordance with section 703(d)(1)(B) and (d)(2) of the Act, Commerce will direct U.S. Customs and Border Protection (CBP) to suspend liquidation of entries of subject merchandise as described in the scope of the investigation section entered, or withdrawn from warehouse, for consumption on or after the date of publication of th ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 19k characters. 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