[Federal Register Volume 66, Number 125 (Thursday, June 28, 2001)]
[Notices]
[Pages 34407-34410]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-16298]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-337-806]


Initiation of Antidumping Duty Investigation: IQF Red Raspberries 
from Chile

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

ACTION: Initiation of Antidumping Duty Investigation.

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EFFECTIVE DATE: June 28, 2001.

FOR FURTHER INFORMATION CONTACT: Craig W. Matney or Jennifer D. Jones 
at (202) 482-1778 and (202) 482-4194, respectively; Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 
20230.

Initiation of Investigation

The Applicable Statute and Regulations

    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 (URAA). In addition, unless otherwise 
indicated, all citations to the Department of Commerce's (the 
Department's) regulations are references to the provisions codified at 
19 CFR part 351 (April 2000).

The Petition

    On May 31, 2001, the Department received a petition filed in proper 
form by the IQF Red Raspberry Fair Trade Committee (hereinafter ``the 
petitioner''). The Department received information supplementing the 
petition throughout the initiation period.
    In accordance with section 732(b) of the Act, the petitioner 
alleges that imports of IQF red raspberries from Chile are being, or 
are likely to be, sold in the United States at less than fair value 
within the meaning of section 731 of the Act, and that such imports are 
materially injuring an industry in the United States.
    The Department finds that the petitioner and its members filed this 
petition on behalf of the domestic industry because it is an interested 
party as defined in section 771(9)(C), (E) and (G) of the Act and it 
has demonstrated sufficient industry support with respect to the 
antidumping investigation that it is requesting the Department to 
initiate (see the Industry Support section, below).

Scope of Investigation

    The products covered by this petition are imports of individually 
quick frozen (IQF) whole or broken red raspberries from Chile, with or 
without the addition

[[Page 34408]]

of sugar or syrup, regardless of variety, grade, size or horticulture 
method (e.g., organic or not), the size of the container in which 
packed, or the method of packing. The scope of the petition excludes 
fresh red raspberries and block frozen red raspberries (i.e., puree, 
straight pack, juice stock, and juice concentrate).
    The merchandise subject to this investigation is classifiable under 
0811.20.2020 of the Harmonized Tariff Schedule of the United States 
(HTSUS). Although the HTSUS subheading is provided for convenience and 
customs purposes, the written description of the merchandise under 
investigation is dispositive.
    During our review of the petition, we discussed the scope with the 
petitioner to ensure that it accurately reflects the product for which 
the domestic industry is seeking relief. Moreover, as discussed in the 
preamble to the Department's regulations (see Antidumping Duties; 
Countervailing Duties; Final Rule, 62 FR 27295, 27323 (May 19, 1997)), 
we are setting aside a period for parties to raise issues regarding 
product coverage. The Department encourages all parties to submit such 
comments within 20 calendar days of publication of this notice. 
Comments should be addressed to Import Administration's Central Records 
Unit at Room 1870, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230. The period of scope 
consultations is intended to provide the Department with ample 
opportunity to consider all comments and consult with parties prior to 
the issuance of the preliminary determination.

Determination of Industry Support for the Petition

    Section 732(b)(1) of the Act requires that a petition be filed on 
behalf of the domestic industry. Section 732(c)(4)(A) of the Act 
provides that a petition meets this requirement if the domestic 
producers or workers who support the petition account for: (1) At least 
25 percent of the total production of the domestic like product, and 
(2) more than 50 percent of the production of the domestic like product 
produced by that portion of the industry expressing support for, or 
opposition to, the petition.
    Section 771(4)(A) of the Act defines the ``industry'' as the 
producers of a domestic like product. Thus, to determine whether the 
petition has the requisite industry support, the statute directs the 
Department to look to producers and workers who produce the domestic 
like product. The International Trade Commission (ITC), which is 
responsible for determining whether ``the domestic industry'' has been 
injured, must also determine what constitutes a domestic like product 
in order to define the industry. While both the Department and the ITC 
must apply the same statutory definition regarding the domestic like 
product (section 771(10) of the Act), they do so for different purposes 
and pursuant to separate and distinct authority. In addition, the 
Department's determination is subject to limitations of time and 
information. Although this may result in different definitions of the 
domestic like product, such differences do not render the decision of 
either agency contrary to the law.\1\
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    \1\ See Algoma Steel Corp. Ltd. v. United States, 688 F. Supp. 
639, 642-44 (CIT 1988); High Information Content Flat Panel Displays 
and Display Glass from Japan: Final Determination; Rescission of 
Investigation and Partial Dismissal of Petition, 56 FR 32376, 32380-
81 (July 16, 1991).
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    Section 771(10) of the Act defines the domestic like product as ``a 
product which is like, or in the absence of like, most similar in 
characteristics and uses with, the article subject to an investigation 
under this subtitle.'' Thus, the reference point from which the 
domestic like product analysis begins is ``the article subject to an 
investigation,'' i.e., the class or kind of merchandise to be 
investigated, which normally will be the scope as defined in the 
petition.
    The domestic like product referred to in the petition is the single 
domestic like product defined in the ``Scope of Investigations'' 
section above. No party has commented on the petition's definition of 
the domestic like product, and there is nothing on the record to 
indicate that this definition is inaccurate. The Department, therefore, 
has adopted the domestic like product definition set forth in the 
petition.
    Moreover, the Department has determined that the petition contains 
adequate evidence of industry support; therefore, polling is 
unnecessary (see Initiation Checklist, dated June 20, 2001 (Initiation 
Checklist), at Industry Support). The petitioner indicated that there 
may be several additional small U.S. producers accounting for less than 
10 percent of U.S. production who are not members of the IQF Red 
Raspberry Fair Trade Committee. We have no knowledge of any other 
domestic producers of IQF red raspberries. Accordingly, the Department 
determines that this petition is filed on behalf of the domestic 
industry within the meaning of section 732(b)(1) of the Act.

Initiation Standard for Cost Investigations

    Pursuant to section 773(b) of the Act, the petitioner submitted 
information providing reasonable grounds to believe or suspect that 
sales made by Chilean producers/exporters in the comparison markets 
were at prices below the cost of production (COP) and, accordingly, 
requested that the Department initiate country-wide sales-below-COP 
investigations in connection with this investigation. The Statement of 
Administrative Action (SAA), submitted to the Congress in connection 
with the interpretation and application of the URAA, states that an 
allegation of sales below COP need not be specific to individual 
exporters or producers. SAA, H.R. Doc. No. 103-316 at 833 (1994). The 
SAA, at 833, states that ``Commerce will consider allegations of below-
cost sales in the aggregate for a foreign country, just as Commerce 
currently considers allegations of sales at less than fair value on a 
country-wide basis for purposes of initiating an antidumping 
investigation.''
    Further, the SAA provides that new section 773(b)(2)(A) of the Act 
retains the requirement that the Department have ``reasonable grounds 
to believe or suspect'' that below-cost sales have occurred before 
initiating such an investigation. Reasonable grounds exist when an 
interested party provides specific factual information on costs and 
prices, observed or constructed, indicating that sales in the foreign 
market in question are at below-cost prices. Id. We have analyzed the 
country-specific allegations as described below.

Export Price and Normal Value

    The data used by the petitioner to calculate U.S. price, COP and 
constructed value (CV) are discussed in the June 20, 2000 Initiation 
Checklist (Initiation Checklist) available in room B-099 of the main 
Commerce building. Should the need arise to use any of this information 
as facts available under section 776 of the Act in our preliminary or 
final determination, we may re-examine the information and revise the 
margin calculations, if appropriate.

Export Price

    The petitioner based export price (EP) on the unit values for the 
sales made during the POI, according to Chilean export data. The per-
unit prices from the Chilean export statistics are stated on an FOB, 
Chilean-port basis. Therefore, the petitioner did not subtract any U.S. 
or international

[[Page 34409]]

movement expenses from the gross unit price. Moreover, the petitioner 
did not adjust EP for foreign inland freight expenses. The petitioner 
explained that it is not aware of any differences in such expenses 
between U.S. sales and the third country sales used for normal value 
(NV). No other deductions to the starting price were made to calculate 
EP.

Normal Value

Price-to-Price Comparisons

    The petitioner claims that there was not a viable home market for 
IQF red raspberries in Chile. Therefore, the petitioner identified the 
largest third-country market for each of the Chilean producers used in 
the margin calculations.
    The per-unit prices from the Chilean export statistics for each 
third-country market are stated on an FOB, Chilean-port basis. 
Therefore, the petitioner did not subtract any third-country or 
international movement expenses from the gross unit price. The 
petitioner did not adjust NV for foreign inland freight expenses or 
make any circumstance of sale adjustments, other than commission 
expenses for one exporter. The petitioner explained that it is not 
aware of any differences in such expenses between the third country 
sales used for NV and U.S. sales. For Arvalan S.A., the petitioner made 
a circumstance of sale adjustment to NV for commissions paid in both 
the U.S. and comparison markets. Also, the petitioner did not adjust 
for differences in packing, stating that exports to the United States 
and third countries are packed in the same way for the six exporters 
used in the petition's margin calculations.
    Based on information submitted in a supplement to the petition, we 
also have calculated a company-specific margin for a seventh exporter. 
For further discussion, see the Initiation Checklist.
    Based on price-to-price comparisons, calculated in accordance with 
section 773(a) of the Act, the estimated dumping margins for IQF red 
raspberries from Chile range from 0 to 10.32 percent.

Price-to-CV Comparisons

    The petitioner also provided information demonstrating reasonable 
grounds to believe or suspect that sales of IQF red raspberries from 
Chile in the United Kingdom, Netherlands, France and Belgium were made 
at prices below the fully absorbed COP, within the meaning of section 
773(b) of the Act, and requested that the Department conduct country-
wide sales-below-cost investigations of such sales.
    Pursuant to section 773(b)(3) of the Act, COP consists of COM; 
selling, general and administrative expenses; and packing. The 
petitioner calculated COP by adding the cost of the acquisition of the 
red raspberries to the cost of processing these berries into IQF red 
raspberries. The petitioner derived the cost of the berries from a 1999 
Chilean government estimate of the cost of red raspberries during the 
1999-2000 growing season and the ratio of processing costs to berry 
acquisition cost from a 1991 estimate from an agricultural periodical. 
To support the petitioner's contention that the 1991 estimate is 
representative of POI processing costs, a supplement to the petition 
provides COP information, including processing costs, from the seventh 
Chilean producer of the subject merchandise for a period substantially 
closer in time to the POI. Because processing costs in this supplement 
are substantially similar to the 1991 estimate, they support the 1991 
information as a basis for calculating COP for the other six exporters, 
while also providing company-specific processing costs for the seventh 
exporter (see June 20, 2001 Memorandum from Susan Kuhbach to Richard 
Moreland). Accordingly, we have used this information, along with the 
raspberry acquisition costs for the 1999-2000 growing season, as the 
basis for initiating COP investigations.
    Based upon a comparison of the prices of the foreign like product 
in the comparison markets to the calculated COP of the product, we find 
reasonable grounds to believe or suspect that sales of the foreign like 
product in the United Kingdom, Netherlands, France and Belgium were 
made below the COP, within the meaning of section 773(b)(2)(A)(i) of 
the Act. Accordingly, the Department is initiating country-wide cost 
investigations for the United Kingdom, Netherlands, France and Belgium. 
However, if information collected during the investigation indicates 
that any exporter's home market is viable or the appropriate comparison 
market is not the United Kingdom, Netherlands, France or Belgium, a new 
cost allegation for that exporter or country will be required.
    Pursuant to sections 773(a)(4), 773(b) and 773(e) of the Act, the 
petitioner also based NV for sales in the comparison markets on CV. The 
petitioner calculated CV starting with the same COP figure used to 
compute comparison market costs. Consistent with section 773(e)(2) of 
the Act, the petitioner also included in CV an amount for profit. For 
profit, the petitioner relied upon a publicly-available amount reported 
for the Chilean frozen red raspberry industry. For further discussion, 
see the Initiation Checklist.
    Based upon the comparison of CV to EP, after adjustments by the 
Department, the petitioner calculated estimated dumping margins ranging 
from 2.73 to 61.27 percent.

Fair Value Comparisons

    Based on the data provided by the petitioner, there is reason to 
believe that imports of IQF red raspberries are being, or are likely to 
be, sold at less than fair value.

Allegations and Evidence of Material Injury and Causation

    The petition alleges that the U.S. industry producing the domestic 
like product is being materially injured, or is threatened with 
material injury, by reason of the imports of the subject merchandise. 
The petitioner contends that the industry's injured condition is 
evident in the declining trends in net operating income, net sales 
volume and value, profit to sales ratios, and capacity utilization. The 
allegations of injury and causation are supported by relevant evidence 
including U.S. Customs import data, lost sales data, and pricing 
information. We have assessed the allegations and supporting evidence 
regarding material injury and causation, and have determined that these 
allegations are properly supported by accurate and adequate evidence, 
and meet the statutory requirements for initiation (see Initiation 
Checklist).

Initiation of Antidumping Investigation

    Based upon our examination of the petition on IQF red raspberries, 
we have found that it meets the requirements of section 732 of the Act. 
Therefore, we are initiating an antidumping duty investigation to 
determine whether imports of IQF red raspberries from Chile are being, 
or are likely to be, sold in the United States at less than fair value. 
Unless this deadline is extended, we will make our preliminary 
determination no later than 140 days after the date of this initiation.

Distribution of Copies of the Petition

    In accordance with section 732(b)(3)(A) of the Act, a copy of the 
public version of the petition has been provided to the representatives 
of the Government of Chile. We will attempt to provide a copy of the 
public version of the petition to each exporter named in the petition, 
as appropriate.

[[Page 34410]]

International Trade Commission Notification

    We have notified the ITC of our initiation, as required by section 
732(d) of the Act.

Preliminary Determination by the ITC

    The ITC will determine, no later than July 16, 2001, whether there 
is a reasonable indication that imports of IQF red raspberries from 
Chile are causing material injury, or threatening to cause material 
injury, to a U.S. industry. A negative ITC determination will result in 
the investigation being terminated; otherwise, these investigations 
will proceed according to statutory and regulatory time limits.
    This notice is issued and published pursuant to section 777(i) of 
the Act.

    Dated: June 20, 2001.
Faryar Shirzad,
Assistant Secretary for Import Administration.
[FR Doc. 01-16298 Filed 6-27-01; 8:45 am]
BILLING CODE 3510-DS-P