[Federal Register Volume 65, Number 160 (Thursday, August 17, 2000)]
[Notices]
[Pages 50180-50182]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-20983]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-201-802]


Gray Portland Cement and Clinker From Mexico: Preliminary Results 
of Changed-Circumstances Antidumping Duty Administrative Review

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

ACTION: Preliminary results of changed-circumstances antidumping duty 
administrative review.

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SUMMARY: The Department of Commerce received information sufficient to 
warrant initiation of a changed-circumstances administrative review of 
the antidumping duty order on gray portland cement and clinker from 
Mexico. Based on information on the record, we preliminarily determine 
that GCC Cementos, S.A. de C.V., is the

[[Page 50181]]

successor-in-interest to Cementos de Chihuahua, S.A. de C.V., for 
purposes of determining antidumping liability.
    Interested parties are invited to comment on these preliminary 
results.

EFFECTIVE DATE: August 17, 2000.

FOR FURTHER INFORMATION CONTACT: Minoo Hatten or Davina Hashmi, Office 
of AD/CVD Enforcement 3, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue NW., Washington, DC 20230; telephone (202) 482-1690 
or (202) 482-5760 respectively.

SUPPLEMENTARY INFORMATION:

Background

    On November 24, 1999, Cementos de Chihuahua, S.A. de C.V. (CDC), 
requested that the Department of Commerce (the Department) conduct an 
expedited changed-circumstances review, pursuant to section 751(b)(1) 
of the Tariff Act of 1930, as amended (the Act). In that letter, CDC 
stated that effective December 1, 1999, GCC Cementos, S.A. de C.V., 
(GCCC) a newly created company, will be the successor in interest to 
CDC due to a corporate reorganization. CDC also stated that it would 
become a holding company and the parent of GCCC and its subsidiary 
companies. On December 13, 1999, the petitioner, the Southern Tier 
Cement Committee, opposed CDC's request that the Department initiate an 
expedited changed-circumstances review. Since the Department had very 
little information on the record concerning this corporate 
reorganization, the Department concluded that it would be inappropriate 
to conduct an expedited changed-circumstances review and issue a 
preliminary determination concurrent with the initiation of a changed-
circumstance review. Thus, the Department published only a notice of 
initiation. See Gray Portland Cement and Clinker From Mexico: Notice of 
Initiation of Antidumping Duty Changed-Circumstances Review, 65 FR 1592 
(January 11, 2000). On January 20, 2000, the Department sent a 
questionnaire to GCCC requesting additional information. On February 9, 
2000, the Department received GCCC's response to the questionnaire. On 
April 6, 2000, the Department sent a supplemental questionnaire to 
GCCC. GCCC responded on April 27, 2000. On June 23, 2000, the 
Department conducted a verification of information pertaining to this 
changed-circumstances review at GCCC's offices in Chihuahua, Mexico.

The 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 Act by the Uruguay Round Agreements 
Act (URAA). In addition, unless otherwise indicated, all citations to 
the Department's regulations are to 19 CFR Part 351 (1999).

Scope of the Review

    The products covered by this review include gray portland cement 
and clinker. Gray portland cement is a hydraulic cement and the primary 
component of concrete. Clinker, an intermediate material product 
produced when manufacturing cement, has no use other than of being 
ground into finished cement. Gray portland cement is currently 
classifiable under the Harmonized Tariff Schedule (HTS) item number 
2523.29 and cement clinker is currently classifiable under item number 
2523.10. Gray portland cement has also been entered under item number 
2523.90 as ``other hydraulic cements.''
    The HTS subheadings are provided for convenience and customs 
purposes only. Our written description remains dispositive as to the 
scope of the product coverage.

Preliminary Results of Review

    In accordance with section 751(b) of the Act, the Department 
initiated a changed-circumstances review to determine whether GCCC is 
the successor-in-interest to CDC for purposes of determining 
antidumping duty liability with respect to gray portland cement and 
clinker from Mexico. In making such a successor-in-interest 
determination, the Department examines several factors including, but 
not limited to, changes in the following: (1) Management; (2) 
production facilities; (3) supplier relationships; (4) customer base. 
See, e.g., Antifriction Bearings (Other Than Tapered Roller Bearings) 
and Parts Thereof From Japan; Final Results of Changed-Circumstances 
Review, 64 FR 55696, 55697 (October 14, 1999) (AFBs from Japan). While 
no single or several of these factors will necessarily provide a 
dispositive indication, the Department will generally consider the new 
company to be the successor to the previous company if its resulting 
operation is similar to that of its predecessor. See, e.g., Industrial 
Phosphoric Acid from Israel; Final Results of Changed-Circumstances 
Review, 59 FR 6944, 6945-46 (February 14, 1994), Brass Sheet and Strip 
from Canada; Final Results of Antidumping Duty Administrative Review, 
57 FR 20460, 20461 (May 13, 1992) (Brass Sheet and Strip from Canada), 
and AFBs from Japan. Thus, if the evidence demonstrates that, with 
respect to the production and sale of the subject merchandise, the new 
company operates as the same business entity as the former company, the 
Department will assign the new company the same cash-deposit rate of 
its predecessor. See, e.g., Brass Sheet and Strip from Canada.
    On December 1, 1999, CDC ceased production and marketing operations 
of merchandise subject to the antidumping duty order on gray portland 
cement and clinker from Mexico. During verification, the Department 
examined the audited financial statements for CDC and GCCC for the 
fiscal year ending December 31, 1999. In addition, the Department also 
examined the reports from the independent auditors. Both of these 
documents demonstrate that CDC's current assets, fixed assets, 
liabilities, stockholder equity, and personnel were transferred to GCCC 
on December 1, 1999. The Department also examined the ``Informe 
Especial de Escision'' (spin-off report), which was presented to the 
board of directors of CDC and which confirms that GCCC will assume the 
property of all machinery and equipment from CDC. Further, CDC's 
February 9, 2000, questionnaire response at 2 also indicated that it 
transferred all of its production facilities, including its physical 
plant, equipment, and personnel, to GCCC. The Department also reviewed 
the contract between the unionized workers and the management of GCCC 
which stated that GCCC assumed all labor agreements pertaining to CDC. 
In addition, GCCC demonstrated that it had the same members on its 
board of directors as were formerly on the CDC board of directors. The 
Department also examined the CDC general organizational structure for 
November 1999 and the GCCC general organizational structure for January 
2000 which confirmed that there were no changes in personnel or 
functions.
    The Department reviewed a sample letter sent on November 24, 1999, 
to a customer explaining that GCCC would be created as a spin-off from 
CDC and that the new company would be producing, selling, and carrying 
on all activities currently conducted by CDC. In addition, at 
verification, Department officials discussed the channels of 
distribution for GCCC and observed that there were no changes from 
those which CDC used. Also at verification, the Department reviewed 
exhibits

[[Page 50182]]

identifying the types of customers which purchase GCCC's cement through 
the bulk channel of distribution and the bag channel of distribution 
for the United States and Mexico. These lists were identical to the 
lists of customer categories provided by CDC in its questionnaire 
response for the 1998/1999 administrative review of the order currently 
in progress. In addition, in CDC's February 9, 2000, changed-
circumstances questionnaire response at 16, CDC states that GCCC has 
the identical customer base and supplier relationships as CDC.
    During verification, the Department verifiers also examined the 
list of product codes for CDC prior to the reorganization and the 
product codes for GCCC after the reorganization and observed that there 
were no changes. The Department examined the November 1999 cost-of-
production worksheets for CDC and tied the consolidated ending-
inventory values to the beginning GCCC December 1999 cost-of-production 
worksheet. The GCCC inventory values tied to the monthly trial balances 
by plant.
    As discussed above, CDC has demonstrated that it transferred its 
management, production facilities, supplier relationships, and customer 
base to the newly created company GCCC. As such, based on our analysis 
of information on the record, we preliminarily determine that GCCC is 
the successor-in-interest to CDC.

Public Comment

    Any interested party may request a hearing within 10 days of 
publication of this notice. Any hearing, if requested, will be held no 
later than 25 days after the date of publication of this notice, or the 
first workday thereafter. Case briefs and/or written comments from 
interested parties may be submitted not later than 14 days after the 
date of publication of this notice. Rebuttal briefs and rebuttals to 
written comments, limited to the issues raised in those comments, may 
be filed not later than 21 days after the date of publication of this 
notice. All written comments shall be submitted in accordance with 19 
CFR 351.303. Persons interested in attending the hearing, if one is 
requested, should contact the Department for the date and time of the 
hearing. The Department will publish the final results of this changed-
circumstances review, including the results of its analysis of issues 
raised in any written comments.
    We are issuing and publishing this determination and notice in 
accordance with sections 751(b)(1) and 777(i)(1) of the Act and 19 CFR 
351.216 and 351.222.

    Dated: August 11, 2000.
Troy H. Cribb,
Acting Assistant Secretary for Import Administration.
[FR Doc. 00-20983 Filed 8-16-00; 8:45 am]
BILLING CODE 3510-DS-P