[Federal Register Volume 59, Number 45 (Tuesday, March 8, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-5308]
[[Page Unknown]]
[Federal Register: March 8, 1994]
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DEPARTMENT OF COMMERCE
[C-301-003]
Roses and Other Cut Flowers From Colombia; Final Results of
Countervailing Duty Administrative Review and Determination Not To
Terminate Suspended Investigation
AGENCY: International Trade Administration/Import Administration,
Department of Commerce.
ACTION: Notice of final results of countervailing duty administrative
review.
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SUMMARY: On October 7, 1993, the Department of Commerce (``the
Department'') published the preliminary results of its administrative
review and intent not to terminate the suspended countervailing duty
investigation on roses and other cut flowers from Colombia. The review
covers the period January 1, 1988 through December 31, 1990 and eight
programs. On January 31, 1991, the Government of Colombia (``GOC'')
requested termination of the suspended investigation based on
abolishment of the programs for a period of at least three consecutive
years, in accordance with 19 CFR 355.25(a)(1) and 355.25(b)(1).
Therefore, we examined the programs to determine if each program had
been abolished for a period of at least three consecutive years. We
gave interested parties an opportunity to comment on the preliminary
results. After reviewing all the comments received, we determine that
the GOC and the producer/exporters of roses and other cut flowers have
complied with the terms of the suspension agreement. However, we also
determine that the GOC has not abolished each program for a period of
at least three consecutive years. Therefore, we determine that the GOC
has not met all the requirements for termination of the countervailing
duty suspended investigation on roses and other cut flowers as outlined
in the Commerce Regulations.
For the purpose of revoking a countervailing duty order or
terminating a suspending countervailing duty investigation based on
three consecutive years of elimination of all subsidies pursuant to 19
CFR 355.25(a)(1), it is the Department of Commerce's current policy
that administrative reviews must be requested and conducted for each of
the three consecutive years. See Memorandum from Joseph A. Spetrini,
Deputy Assistant Secretary for Compliance, to Alan M. Dunn, Assistant
Secretary for Import Administration, of December 14, 1992, which fully
describes this issue. However, the request for termination in this case
predates the above policy. Therefore, although no review was requested
for 1989, we nevertheless have examined a three-year period in order to
determine whether termination is appropriate. We invited interested
parties to comment on these results.
EFFECTIVE DATE: March 8, 1994.
FOR FURTHER INFORMATION CONTACT: Stephen Jacques or Jeanene Lairo,
Office of Agreements Compliance, International Trade Administration,
U.S. Department of Commerce, Washington, DC 20230; telephone: (202)
482-3434 or (202) 482-2243, respectively.
SUPPLEMENTARY INFORMATION:
Background
On October 7, 1993, the Department published in the Federal
Register the preliminary results of its countervailing duty
administrative review and intent not to terminate the suspended
investigation on roses and other cut flowers from Colombia (58 FR
52272). (See Roses and Other Cut Flowers From Colombia; Suspension of
Investigation, 48 FR 2158 (January 18, 1983); and Roses and Other Cut
Flowers From Colombia; Final Results of Countervailing Duty
Administrative Review and Revised Suspension Agreement, 51 FR 44930
(December 15, 1986).) We have now completed the administrative review
in accordance with section 751 of the Tariff Act of 1930, as amended
(``the Tariff Act'').
Scope and Review
Imports covered by this review are shipments of roses and other cut
flowers from Colombia. During the review period, the merchandise
covered by this suspension agreement is classified under Harmonized
Tariff Schedule (``HTS'') item numbers 0603.10.60, 0603.10.70,
0603.10.80, and 0603.90.00. The HTS item numbers are provided for
convenience and Customs purposes. The written description remains
dispositive.
The period of review (``POR'') covers January 1, 1988 through
December 31, 1990, and eight programs: (1) Tax Reimbursement
Certificate Program (Certificate Program Certificado de Reembolso
Tributario (``CERT'' program)); (2) The Fund for the Promotion of
Export Loans (working and fixed-capital) (``PROEXPO''); (3) Plan
Vallejo; (4) Air Freight Rates; (5) Free Industrial Zones; (6) Export
Credit Insurance; (7) Countertrade; and (8) Research and Development.
Analysis of Comments Received
We gave interested parties an opportunity to comment on the
preliminary results. Also, at the request of the petitioner, the Floral
Trade Council (``FTC''), and the GOC, we held a public hearing on
December 3, 1993. Several issues raised by interested parties in this
review are not case-specific but pertain both to this administrative
review and the countervailing duty administrative review and intent not
to terminate the suspended investigation on miniature carnations from
Colombia. The comments submitted by interested parties concerning
issues common to both these reviews of suspended investigations are
summarized and addressed in the Final Results of Countervailing Duty
Administrative Review and Intent Not to Terminate Suspended
Investigation; Miniature Carnations from Colombia which is being
published concurrently with this notice. The following comment is
specific only to this administrative review on roses and other cut
flowers from Colombia.
Comment: The GOC contends that it was under no obligation to
abolish the air freight rate ``program'' since the Department never
found it countervailable and since there was never any subsidy on the
merchandise conferred by air freight rates. Furthermore, the GOC argues
that the Department's inclusion of air freight rates in the 1983 roses
suspension agreement was not carried forward into the 1986 revised
suspension agreement. Thus, consideration of air freight rates under
the suspension agreement is no longer in effect. The GOC contends that
the air freight rate ``program'' is in fact not a program because the
Departmento Administrativo de la Aeronautica Civil (``DAAC'') only sets
minimum and maximum permissible air freight rates. The GOC argues that
the Department has agreed with the respondent that the establishment of
minimum and maximum rates ``does not confer countervailable benefits.''
The FTC asserts that the Department has the discretion to consider
the continued existence of a potentially countervailable program even
if that program is not specifically found to be countervailable in the
suspension agreement. The FTC asserts that during the POR, the GOC was
unable to establish that the actual air freight rates were
competitively priced. Furthermore, the FTC asserts that the GOC did not
submit comparative air freight rates or export statistics to third
countries. Consequently, as best information available, the FTC
contends that the Department should presume air freight maximums
limited competitive rates contrary to the terms of the suspension
agreement.
Department's Position: While we agree with petitioner that the
Department has discretion to consider a potentially countervailable
program, we disagree with the FTC's assertion that the GOC has violated
the suspension agreement. The DAAC minimum/maximum rates were
established in 1981, prior to negotiation of the suspension agreement.
At verification we found that the rates negotiated between the flower
producers and air freight carriers were between the DAAC minimum/
maximum rates permitted under the suspension agreement. There is no
evidence that these negotiated rates limited competitive air rates. In
addition, at verification, we examined documentation and determined the
rates negotiated were between the minimum/maximum negotiated rates.
Consequently, we determined that the GOC is not in violation of the
suspension agreement.
With regard to abolition of this program, the Department agrees
with the GOC in part. The Department's regulations at 19 CFR
355.25(a)(1)(i) require the GOC to abolish all programs for the subject
merchandise that ``the Secretary has found countervailable.'' Although
the Department has found the air freight rate program subject to the
suspension agreement (see Roses and Other Cut Flowers From Colombia;
Final Results of Countervailing Duty Administrative Review, 55 FR 53584
(Comment 4) (December 31, 1990)), we have never found the air freight
rates program to be a countervailable subsidy. Therefore, under the
conditions set by 19 CFR 355.25(a)(1)(i) the GOC is not required to
abolish the program in order to meet the requirements for termination
of the suspension agreement.
Final Results of Review
After considering all of the comments received, we determine that
the signatories have complied with the terms of the suspension
agreement for the period January 1, 1988 through December 31, 1990.
However, we will not terminate the suspension agreement. In order for
us to terminate the suspension agreement the GOC must have abolished
all programs which is not the case with PROEXPO and Plan Vallejo.
This administrative review and notice are in accordance with
sections 751(a)(1)(C) of the Tariff Act (19 U.S.C. 1675(a)(1)(C)) and
19 CFR 355.22 and 355.25.
Dated: March 1, 1994.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 94-5308 Filed 3-7-94; 8:45 am]
BILLING CODE 3510-05-P