[Federal Register Volume 68, Number 66 (Monday, April 7, 2003)]
[Notices]
[Pages 16763-16764]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-8411]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-475-818][C-475-819]


Notice of Initiation and Preliminary Results of Antidumping and 
Countervailing Duty Changed Circumstances Reviews: Certain Pasta from 
Italy

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

ACTION: Notice of Initiation and Preliminary Results of Antidumping and 
Countervailing Duty Changed Circumstances Reviews: Certain Pasta from 
Italy.

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SUMMARY: The Department of Commerce (the Department) has received 
information sufficient to warrant initiation of changed circumstances 
reviews of the antidumping and countervailing duty orders on certain 
pasta from Italy. Based on this information, we preliminarily determine 
that Pasta Lensi S.r.l. is the successor-in-interest to Italian 
American Pasta Company Italia S.r.l. (IAPC) for purposes of determining 
antidumping and countervailing duty liability. Interested parties are 
invited to comment on these preliminary results.

EFFECTIVE DATE: April 7, 2003.

FOR FURTHER INFORMATION CONTACT: Alicia Kinsey (Antidumping) or Stephen 
Cho (Countervailing), Office of AD/CVD Enforcement, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th and Constitution Avenue, NW, Washington, DC 20230; 
telephone: (202) 482-4793 or (202) 482-3798, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On July 24, 1996, the Department published in the Federal Register 
the antidumping duty order on pasta from Italy (61 FR 38547). Also, on 
July 24, 1996, the Department published in the Federal Register the 
companion countervailing duty order (61 FR 38544). Five reviews of 
these orders have been conducted, and a sixth is underway. IAPC 
participated in the fifth review and is an interested party in the 
ongoing sixth review of these orders. On February 12, 2003, IAPC 
submitted a letter stating that it changed its corporate name to Pasta 
Lensi S.r.l. (Lensi), and that Lensi is the successor-in-interest to 
IAPC. As such, the former IAPC argues that Lensi is entitled to receive 
the same antidumping and countervailing cash deposit rates accorded to 
IAPC.
    The former IAPC also requested that the Department conduct 
expedited changed circumstances reviews pursuant to 19 CFR 
351.221(c)(3)(ii). Petitioners have not responded to IAPC's February 
12, 2003 request for changed circumstances reviews.

Scope of Review

    Imports covered by these reviews are shipments of certain non-egg 
dry pasta in packages of five pounds (2.27 kilograms) or less, whether 
or not enriched or fortified or containing milk or other optional 
ingredients such as chopped vegetables, vegetable purees, milk, gluten, 
diastases, vitamins, coloring and flavorings, and up to two percent egg 
white. The pasta covered by this scope is typically sold in the retail 
market, in fiberboard or cardboard cartons, or polyethylene or 
polypropylene bags of varying dimensions.
    Excluded from the scope of these reviews are refrigerated, frozen, 
or canned pastas, as well as all forms of egg pasta, with the exception 
of non-egg dry pasta containing up to two percent egg white.
    The merchandise subject to review is currently classifiable under 
item 1902.19.20 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 subject to 
the order is dispositive.

Scope Rulings

    The Department has issued the following scope rulings to date:
    (1) On August 25, 1997, the Department issued a scope ruling that 
multicolored pasta, imported in kitchen display bottles of decorative 
glass that are sealed with cork or paraffin and bound with raffia, is 
excluded from the scope of the antidumping and countervailing duty 
orders. See Memorandum from Edward Easton to Richard Moreland, dated 
August 25, 1997, which is on file in the Central Records Unit (CRU), 
room B-099 of the main Commerce Department Building.
    (2) On July 30, 1998, the Department issued a scope ruling, finding 
that multipacks consisting of six one-pound packages of pasta that are 
shrink-wrapped into a single package are within the scope of the 
antidumping and countervailing duty orders. See Letter from Susan H. 
Kuhbach to Barbara P. Sidari, dated July 30, 1998, which is available 
in the CRU.
    (3) On October 23, 1997, the petitioners filed an application 
requesting that the Department initiate an anti-circumvention 
investigation of Barilla, an Italian producer and exporter of pasta. 
The Department initiated the investigation on December 8, 1997 (62 FR 
65673). On October 5, 1998, the Department issued its final 
determination that Barilla's importation of pasta in bulk and 
subsequent repackaging in the United States into packages of five 
pounds or less constitutes circumvention, with respect to the 
antidumping duty order on pasta from Italy pursuant to section 781(a) 
of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.225(b). 
See Anti-circumvention Inquiry of the Antidumping Duty Order on Certain 
Pasta from Italy: Affirmative Final Determination of Circumvention of 
the Antidumping Duty Order, 63 FR 54672 (October 13, 1998).
    (4) On October 26, 1998, the Department self-initiated a scope 
inquiry to determine whether a package weighing over five pounds as a 
result of allowable industry tolerances is within the scope of the 
antidumping and countervailing duty orders. On May 24, 1999, we issued 
a final scope ruling finding that, effective October 26, 1998, pasta in 
packages weighing or labeled up to (and including) five pounds four 
ounces is within the scope of the antidumping and countervailing duty 
orders. See Memorandum from John Brinkmann to Richard Moreland, dated 
May 24, 1999, which is available in the CRU.
    The following scope ruling is pending:
    (5) On April 27, 2000, the Department self-initiated an anti-
circumvention inquiry to determine whether Pagani's importation of 
pasta in bulk and subsequent repackaging in the United States into 
packages of five pounds or less constitutes circumvention, with respect 
to the antidumping and countervailing duty orders on pasta from Italy 
pursuant to section 781(a) of the Act and 19 CFR 351.225(b). See 
Certain Pasta from Italy: Notice of Initiation of Anti-circumvention 
Inquiry

[[Page 16764]]

of the Antidumping and Countervailing Duty Orders, 65 FR 26179 (May 5, 
2000).

Initiation and Preliminary Results of Changed Circumstances Antidumping 
and Countervailing Duty Reviews

    In the February 12, 2003 submission, IAPC advised the Department 
that in September of 2002, IAPC acquired certain intangible assets of 
Pastificio Lensi S.p.A and that IAPC resolved to change its name to 
Pasta Lensi S.r.l. The February 12, 2003 submission demonstrates that 
in November 2002, a Registration Notice registering the name change was 
filed with the Brescia Chamber of Commerce, Industry, Handicrafts, and 
Agriculture. Prior to the acquisition and name change, the former IAPC 
made two changes to its board of directors and company management. 
However, the corporate structure and ownership of the company did not 
change as a result of the name change. Lensi operates the same 
production facility operated by IAPC. No production facilities have 
been added, eliminated, or transferred since the name change. Lensi's 
supplier relationships have stayed the same as IAPC's, and Lensi's 
customer base did not substantially change as a result of the name 
change. In accordance with section 751(b) of the Act and 19 CFR 
351.216, the Department has determined that there is a sufficient basis 
to initiate changed circumstances reviews to determine whether Lensi is 
the successor-in-interest to IAPC.
    In making such a successor-in-interest determination, the 
Department examines several factors including, but not limited to, 
changes in: (1) management; (2) production facilities; (3) supplier 
relationships; and (4) customer base. See, e.g., Brass Sheet and Strip 
from Canada: Notice of Final Results of Antidumping Administrative 
Review, 57 FR 20460 (May 13, 1992) (Canadian Brass). While no one 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 
not materially dissimilar to that of its predecessor. See Industrial 
Phosphoric Acid from Israel: Final Results of Changed Circumstances 
Review, 59 FR 6944, 6945 (February 14, 1994); see also Canadian Brass, 
57 FR 20460, Comment 1 (``[G]enerally, in the case of an asset 
acquisition, the Department will consider the acquiring company to be a 
successor to the company covered by the antidumping duty order, and 
thus subject to its duty deposit rate, if the resulting operation is 
essentially similar to that existing before the acquisition.'') 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 cash deposit rate of its predecessor.
    We preliminarily determine that Lensi is the successor-in-interest 
to IAPC. Documentation attached to Lensi's February 12, 2003, 
submission supports its claims that the acquisition of certain 
intangible assets resulted in little or no change in either production 
facilities, supplier relationships, customer base, or management. This 
documentation consisted of: (1) minutes of the September 4, 2002 IAPC 
Board of Directors Meeting and September 19, 2002 Extraordinary 
Shareholder Meeting detailing the resolve to change the name from IAPC 
to Lensi and to acquire certain assets, and the shareholder approval of 
the name change and acquisition of assets; (2) Registration Statement 
filed with Brescia Chamber of Commerce; (3) legal structure of the 
former IAPC's parent company, the American Italian Pasta Company's 
European affiliates, before and after the name change; (4) a list of 
the IAPC/Lensi Board of Directors; (5) organization charts for IAPC and 
Lensi, before and after the name change; (6) list of suppliers and 
quantity of purchases for IAPC/Lensi; and (7) customers and quantity of 
sales for IAPC and Lensi, before and after the name change. The 
documentation described above
    demonstrates that (i) substantially all employees of IAPC, 
including most of the management, remain the same, (ii) the intangible 
assets were sold as a going concern, and (iii) there were little or no 
changes in management structure, supplier relationships, production 
facilities, or customer base.
    When ``expedited action is warranted,'' the Department may publish 
the notice of initiation and preliminary determination concurrently. 
See 19 CFR 351.221(c)(3)(ii); see also Granular Polytetrafluoroethyline 
Resin from Italy: Initiation and Preliminary Results of Antidumping 
Duty Changed Circumstances Revew, 68 FR 13672 (March 20, 2003). The 
Department has determined that such action is warranted because IAPC 
has provided prima facie evidence that Lensi is its successor-in-
interest, and we have the information necessary to make a preliminary 
finding already on the record.
    Based upon the record evidence, we find that Lensi operates as the 
same business entity as IAPC. Thus, we preliminarily determine that 
Lensi is the successor-in-interest to IAPC.

Public Comment

    Any interested party may request a hearing within 30 days of 
publication of this notice. Any hearing, if requested, will be held no 
later than 44 days after the date of publication of this notice, or the 
first workday thereafter. Case briefs from interested parties may be 
submitted not later than 30 days after the date of publication of this 
notice. Rebuttal briefs, limited to the issues raised in those 
comments, may be filed not later than 37 days after the date of 
publication of this notice. See 19 CFR 531.309, 310. 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 these changed 
circumstances reviews, including the results of its analysis of issues 
raised in any written comments.
    We are issuing and publishing these determinations and notice in 
accordance with sections 751(b) and 777(i)(1) of the Act and sections 
351.216 and 351.221 of the Department's regulations.

    Dated: March 31, 2003.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 03-8411 Filed 4-4-03; 8:45 am]
BILLING CODE 3510-DS-S