[Federal Register Volume 60, Number 175 (Monday, September 11, 1995)]
[Notices]
[Pages 47153-47154]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-22435]



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DEPARTMENT OF COMMERCE

North American Free Trade Agreement, Article 1904 Binational 
Panel Reviews; Notice of Decision of Binational Panel

AGENCY: NAFTA Secretariat, United States Section, International Trade 
Administration, Department of Commerce.

ACTION: Notice of Decision of Binational Panel.

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SUMMARY: On August 30, 1995 the binational panel in Secretariat Case 
Number MEX-94-1904-02 issued its decision. This panel was convened to 
review the final antidumping duty determination made by the Secretaria 
de Comercio y Fomento Industrial (SECOFI) with respect to Imports of 
Cut-Length Plate, Covered by Customs Tariff Classifications 7208.32.01, 
7208.33.01, 7208.42.01 and 7208.43.01 of the Tariff Schedule of the 
General Tax Import Law, Originating in and Entering from the United 
States of America. The panel majority remanded the determination to 
SECOFI to issue a new determination within 21 days (by September 20, 
1995) that terminates the proceeding. A copy of the complete panel 
decision is available from the NAFTA Secretariat.

FOR FURTHER INFORMATION CONTACT:
James R. Holbein, United States Secretary, NAFTA Secretariat, Suite 
2061, 14th and Constitution Avenue, Washington, D.C. 20230, (202) 482-
5438.

SUPPLEMENTARY INFORMATION: Chapter 19 of the North American Free Trade 
Agreement (``Agreement'') establishes a mechanism to replace domestic 
judicial review of final determinations in antidumping and 
countervailing duty cases involving imports from a NAFTA country with 
review by independent binational panels. When a Request for Panel 
Review is filed, a panel is established to act in place of national 
courts to review expeditiously the final determination to determine 
whether it conforms with the antidumping or countervailing duty law of 
the country that made the determination.
    Under Article 1904 of the Agreement, which came into force on 
January 1, 1994, the Government of the United States, the Government of 
Canada and the Government of Mexico established Rules of Procedure for 
Article 1904 Binational Panel Reviews (``Rules''). These Rules were 
published in the Federal Register on February 23, 1994 (59 FR 8686). 
The binational panel review in this matter was conducted in accordance 
with these Rules.

Background

    On September 1, 1994, Bethlehem Steel Corporation filed a First 
Request for Panel Review with the Mexican Section of the NAFTA 
Secretariat pursuant to Article 1904 of the North American Free Trade 
Agreement. On the same date, a Request for Panel Review was also filed 
by US Steel Group, a unit of USX Corporation. Panel review was 
requested of the final antidumping duty determination made by the 
Secretaria de Comercio y Fomento Industrial with respect to Imports of 
Cut-Length Plate, Covered by Customs Tariff Classifications 7208.32.01, 
7208.33.01, 7208.42.01 and 7208.43.01 of the Tariff Schedule of the 
General Tax Import Law, Originating in and Entering from the United 
States of America. This determination was published in the Diario 
Oficial on Tuesday August 2, 1994. The NAFTA Secretariat has assigned 
Case Number MEX-94-1904-02 to this request.
    Complaints were filed by both requestors challenging SECOFI's final 
determination in three areas:
    1. Jurisdictional and technical errors;
    2. Errors in the calculation of the dumping margin; and
    3. Errors in causation and injury determinations.

Standard of Review

    In reviewing SECOFI's final determination, the Panel determined 
that it must apply the standard of review and the general legal 
principles that a Mexican court (the Fiscal Tribunal) would apply when 
it reviews a final determination by SECOFI. The Panel interpreted this 
obligation to require it to apply Article 238 of the Federal Fiscal 
Code, in conjunction with Articles 237 and 239, to the maximum extent, 
consistent with the nature of the binational panel review process.
    In deciding whether SECOFI's determination under this standard of 
review was in accordance with the antidumping law of Mexico, the Panel 
also determined that it was required to examine the applicable 
provisions of the Mexican Constitution, treaties, statutes, legislative 
history, regulations, administrative practice and judicial precedents--
all to the extent that the Mexican Fiscal Tribunal would have relied on 
such legal sources.
    The Panel further found that the guarantees of legality and legal 
security contained in Articles 14 and 16 of the Mexican Constitution 
impact both the interpretation to be given to the standard of review 
and to the substance and procedure of any Mexican antidumping 
proceeding. A primary function of judicial review by Mexican courts 
and, consequently, by the Panel, is the enforcement of these 
guarantees. The Panel concluded that in order for the actions of 
Mexican authorities to be legal, the agency issuing or carrying out 
such functions or performing such acts, must be ``competent'': the 
existence of the acting entity or unit must be formally established in 
a legal provision; and that entity or unit must only act in accordance 
with the express authority granted it by Mexican law.

Panel Decision

    In its decision the majority of the Panel only addressed itself to 
Complainants' first areas of challenges--that SECOFI's actions were 
illegal because of jurisdictional errors--since as a consequence of its 
findings, the other areas of challenge became unnecessary to address.
    The Panel decided the following:
    1. The two administrative units that carried out the antidumping 
investigation and proceeding in its early stages (December 4, 1992-
April 1, 1993), namely the Direccion General de Practicas Commerciales 
Internacionales (DGPCI) and the Direccion de Cuotas Compensatorias 
(DCC), were incompetent to do so. They were not duly created and 
established in the manner required by Mexican Law, and, therefore, 
their actions were illegal.
    2. The visitation orders of July 13 and 14, 1993 were illegal 
because they were issued by an administrative unit that was incompetent 
to act.
    3. The verification visits that took place on July 19-21, 1993 were 
performed in part by public officers (Director and Assistant Director 
of Investigation of Dumping and Subsidies) who lacked competence to act 
in that capacity because their administrative units had not been 
legally established.
    4. The ``external advisors'' who participated in the verification 
visits also lacked competence to act.

[[Page 47154]]


Order of the Panel

    Pursuant to NAFTA Article 1904.8, the Panel remanded SECOFI's Final 
Determination to SECOFI for action not inconsistent with its decision. 
In particular, it directed SECOFI to issue a new determination within 
21 days that terminates the proceeding against the Complainants and 
provides that:
    1. The exports of USX and Bethlehem of the goods subject to this 
proceeding enter Mexican territory with zero antidumping duties applied 
to them upon their importation; and
    2. Any cash deposits or customs bonds relative to antidumping 
duties made or posted by the importers, in order to import the goods 
manufactured by USX and Bethlehem, be refunded or cancelled as 
appropriate.

    Dated: September 5, 1995.
James R. Holbein,
United States Secretary, NAFTA Secretariat.
[FR Doc. 95-22435 Filed 9-8-95; 8:45 am]
BILLING CODE 3510-GT-M