[Federal Register Volume 63, Number 6 (Friday, January 9, 1998)]
[Notices]
[Pages 1428-1430]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-487]



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DEPARTMENT OF COMMERCE

International Trade Administration
[A-201-601]


Certain Fresh Cut Flowers From Mexico; Notice of Preliminary 
Results of Antidumping Duty Administrative Review, and Intent To Revoke 
the Order in Part

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.

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SUMMARY: The Department of Commerce (the Department) is conducting an 
administrative review of the antidumping duty order on certain fresh 
cut flowers from Mexico in response to a request from Rancho del 
Pacifico (Pacifico), respondent. Additionally, the Department 
preliminarily intends to revoke the order in part with respect to 
Pacifico. This review covers one producer/exporter and entries of the 
subject merchandise into the United States during the period April 1, 
1996 through March 31, 1997.
    We preliminarily determine that sales have not been made below 
normal value (NV). If these preliminary results are adopted in our 
final results, we will instruct U.S. Customs to liquidate entries 
without regard to antidumping duties.
    Interested parties are invited to comment on these preliminary 
results. Parties who submit argument are requested to submit with each 
argument (1) a statement of the issue and (2) a brief summary of the 
argument.

EFFECTIVE DATE: January 9, 1998.

FOR FURTHER INFORMATION CONTACT: Tamara Underwood or Maureen Flannery, 
Import Administration, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue, N.W., 
Washington D.C. 20230; telephone: (202) 482-4733.
    Applicable Statute: Unless otherwise indicated, all citations to 
the statute are references to the provisions effective January 1, 1995, 
the effective date of the amendments made to the Tariff Act of 1930 
(the Act) by the Uruguay Round Agreements Act. In addition, unless 
otherwise indicated, all citations to the Department's regulations are 
to the regulations as codified at 19 CFR Part 353 (1996).

SUPPLEMENTARY INFORMATION:

Background

    On April 23, 1987, the Department published in the Federal Register 
(52 FR 13491) the antidumping duty order on certain fresh cut flowers 
from Mexico. On April 28, 1997, in accordance with 19 CFR 353.22(a), 
Pacifico requested that the Department conduct an administrative 
review. In accordance with 19 CFR 353.25(b) (1) and (2), Pacifico also 
requested a partial revocation of the antidumping duty order as it 
pertains to it upon completion of this review. We published a notice of 
initiation of review on May 21, 1997 (62 FR 27720). The Department is 
conducting this administrative review in accordance with section 751 of 
the Act.

Scope of the Review

    The products covered by this review are certain fresh cut flowers, 
defined as standard carnations, standard chrysanthemums, and pompon 
chrysanthemums (pompons). During the period of review (POR), such 
merchandise was classifiable under the Harmonized Tariff Schedule of 
the United States (HTSUS) items 0603.10.7010 (pompons), 0603.10.7020 
(standard chrysanthemums), and 0603.10.7030 (standard carnations). The 
HTSUS item numbers are provided for convenience and Customs purposes 
only. The written description remains dispositive as to the scope of 
the order.
    This review covers sales of subject merchandise entered into the 
United States during the period April 1, 1996 through March 31, 1997.

Verification

    As provided in section 776(b) of the Act, we conducted a 
verification of the questionnaire responses submitted by Pacifico. We 
used standard verification procedures, including on-site inspection of 
the manufacturer's facilities, the examination of relevant accounting, 
sales, and other financial records, and the selection of original 
documentation containing relevant information. Our verification results 
are outlined in the public version of the verification report.

Intent To Revoke

    On April 28, 1997, Pacifico submitted a request, in accordance with 
19 CFR 353.25(b), that the Department revoke the order covering certain 
fresh cut flowers from Mexico with respect to its sales of this 
merchandise.
    In accordance with 19 CFR 353.25(a)(2)(iii), this request was 
accompanied by a certification from Pacifico that it had not sold the 
subject merchandise at less than NV for a three-year period, including 
this review period, and would not do so in the future. Pacifico also 
agreed to its immediate reinstatement in the relevant antidumping 
order, as long as any firm is subject to this order, if the Department 
concludes under 19 CFR 353.22(f) that, subsequent to revocation, it 
sold the subject merchandise at less than NV.
    In the two prior reviews of this order, we determined that Pacifico 
sold fresh cut flowers from Mexico at not less than NV. The Department 
conducted a verification of Pacifico's response for this period of 
review. We preliminarily determine that Pacifico sold fresh cut flowers 
at not less than NV during this review period. Based on Pacifico's 
three consecutive years of zero or de minimis margins and the absence 
of evidence to the contrary, we preliminarily determine that it is not 
likely that Pacifico will in the future sell subject merchandise at 
less than NV. Therefore, if these preliminary findings are affirmed in 
our final results, we intend to revoke the order on fresh cut flowers 
from Mexico with respect to Pacifico.

United States Price

    In calculating United States Price (USP), we used constructed 
export price (CEP), in accordance with section 772 (b), (c), and (d) of 
the Act, because Pacifico's sales to the first unaffiliated purchaser 
occurred after importation into the United States. We based CEP on the 
packed F.O.B. prices to the first unaffiliated purchaser after 
importation into the United States. As in the original less-than-fair-
value (LTFV) investigation and in all prior administrative reviews, all 
prices to the United States were weight-averaged on a monthly basis to 
account for the perishability of the product. In accordance with the 
methodology established in the 1992-1993 review, we also calculated USP 
by flower type, without regard to specific grades. (See Final Results 
of Antidumping Duty Administrative Review; Certain Fresh Cut Flowers 
from Mexico, 56 FR 29621 (June 28, 1991).)
    Where appropriate, we made deductions from CEP for foreign and U.S. 
inland freight, U.S. and Mexican brokerage and handling charges, and 
for credit expenses incurred on sales in the United States. No other 
adjustments were claimed or allowed.

Normal Value

    In calculating NV, we used home market prices to unaffiliated 
purchasers, as defined in section 773 of the Act. In order to determine 
whether there was a sufficient volume of sales in the home market to 
serve as a viable basis for calculating NV, we compared Pacifico's 
volume of home market sales of the subject merchandise to the volume of 
U.S. sales of the subject merchandise, in accordance with section 
773(a)(1)(C) of

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the Act. Because Pacifico's volume of home market sales of the subject 
merchandise was greater than five percent of its volume of U.S. sales 
of the subject merchandise, we determined that the home market provides 
a viable basis for calculating NV for Pacifico.
    Home market price was based on F.O.B. farm gate unit price of 
subject merchandise sold to unaffiliated purchasers in the home market. 
No adjustments were claimed or allowed.

Level of Trade

    In accordance with section 773(a)(1)(B) of the Act, to the extent 
practicable, we determine NV based on sales in the comparison market at 
the same level of trade (LOT) as the export price (EP) or CEP 
transaction. The NV LOT is that of the starting-price sales in the 
comparison market or, when NV is based on constructed value, that of 
the sales from which we derive selling, general and administrative 
expenses and profit. For EP, the U.S. LOT is also the level of the 
starting-price sale, which is usually from exporter to importer. For 
CEP, it is the level of the constructed sale from the exporter to the 
importer.
    To determine whether NV sales are at a different LOT than EP or 
CEP, we examine stages in the marketing process and selling functions 
along the chain of distribution between the producer and the 
unaffiliated customer. If the comparison-market sales are at a 
different LOT, and the difference affects price comparability, as 
manifested in a pattern of consistent price differences between the 
sales on which NV is based and comparison-market sales at the LOT of 
the export transaction, we make an LOT adjustment under section 
773(a)(7)(A) of the Act. Finally, for CEP sales, if the NV level is 
more remote from the factory than the CEP level and there is no basis 
for determining whether the difference in the levels between NV and CEP 
affects price comparability, we adjust NV under section 773(a)(7)(B) of 
the Act (the CEP offset provision). See Notice of Final Determination 
of Sales at Less Than Fair Value: Certain Cut-to-Length Carbon Steel 
Plate From South Africa, 62 FR 61731, 61732 (November 19, 1997).
    Pacifico did not claim a LOT adjustment; however, we requested 
information concerning Pacifico's distribution system, including 
classes of customers, selling functions, and selling expenses to 
determine whether such an adjustment was necessary. Pacifico reported 
that all sales during the POR, in both the comparison market, the home 
market in this instant case, and the United States, were to 
wholesalers. We examined information provided by Pacifico concerning 
these sales and determined that there was no difference in either 
selling functions or selling expenses between sales in the home market 
and sales in the United States. Therefore, we preliminarily determine 
that sales in the home market and sales in the United States are at the 
same LOT and that no adjustment is warranted.

Preliminary Results of Review

    We preliminarily determine that the following weighted-average 
dumping margin exists:

------------------------------------------------------------------------
                                                              Margin    
       Manufacturer/exporter             Time period         (percent)  
------------------------------------------------------------------------
Rancho del Pacifico................    04/01/96-03/31/97            0.00
------------------------------------------------------------------------

    Parties to the proceeding may request disclosure within 5 days of 
the date of publication of this notice in accordance with 19 CFR 
353.28. Any interested party may request a hearing within 10 days of 
publication in accordance with 19 CFR 353.38(b). Any hearing, if 
requested, will be held 44 days after the publication of this notice, 
or the first workday thereafter. Interested parties may submit case 
briefs within 30 days of the date of publication of this notice in 
accordance with 19 CFR 353.38(c). Rebuttal briefs, which must be 
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 
a notice of final results of this administrative review, which will 
include the results of its analysis of issues raised in any such 
comments.
    The Department shall determine, and the U.S. Customs Service shall 
assess, antidumping duties on all appropriate entries. Upon completion 
of this review, the Department will issue appraisement instructions 
directly to the U.S. Customs Service.
    Furthermore, the following deposit rates will be effective upon 
publication of the final results of this administrative review for all 
shipments of fresh cut flowers from Mexico entered, or withdrawn from 
warehouse, for consumption on or after the publication date, as 
provided for by section 751(a)(2)(c) of the Act: (1) 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; (2) if the exporter is not a firm covered in this 
review, a prior review, or the original less-than-fair-value 
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 (3) for all other producers and/or exporters of 
this merchandise, the cash deposit rate shall be the rate established 
in the investigation of sales at less than fair value, which is 18.20 
percent. See 52 FR 6361 (March 3, 1987).
    If our intent to revoke is finalized, the revocation will apply to 
all entries of the subject merchandise from Pacifico entered, or 
withdrawn from warehouse, for consumption on or after April 1, 1997. 
The Department will then order the suspension of liquidation ended for 
all such entries and will instruct the Customs Service to release any 
cash deposit or bonds. The Department will further instruct Customs to 
refund with interest any cash deposits on post-March 31, 1997 entries. 
If we do not revoke, the cash deposit rate for Pacifico will be the 
rate established in the final results of this review (except that no 
deposit will be required if the margin is zero or de minimis, i.e., 
less than 0.5 percent).
    These deposit rates, when imposed, shall remain in effect until 
publication of the final results of the next administrative review.
    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 353.25(b) to file 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 Act (19 U.S.C. 1675(a)(1)) and 19 CFR 353.22.


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    Dated: December 29, 1997.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 98-487 Filed 1-8-98; 8:45 am]
BILLING CODE 3510-DS-P