[Federal Register Volume 84, Number 185 (Tuesday, September 24, 2019)]
[Notices]
[Pages 49987-49999]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-20813]



[[Page 49987]]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-201-820]


Fresh Tomatoes From Mexico: Suspension of Antidumping Duty 
Investigation

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

DATES: Applicable September 19, 2019.
SUMMARY: The Department of Commerce (Commerce) has suspended the 
antidumping duty (AD) investigation on fresh tomatoes from Mexico. The 
basis for this action is an agreement between Commerce and signatory 
producers/exporters accounting for substantially all imports of fresh 
tomatoes from Mexico that eliminates completely the injurious effects 
of exports of the subject merchandise to the United States.

FOR FURTHER INFORMATION CONTACT: Sally C. Gannon or David Cordell at 
(202) 482-0162 or (202) 482-0408, respectively; Bilateral Agreements 
Unit, Office of Policy, Enforcement and Compliance, International Trade 
Administration, U.S. Department of Commerce, 1401 Constitution Avenue 
NW, Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Background

    On April 18, 1996, Commerce initiated an antidumping duty 
investigation under section 732 of the Tariff Act of 1930, as amended 
(the Act), to determine whether imports of fresh tomatoes from Mexico 
are being, or are likely to be, sold in the United States at less than 
fair value (LTFV).\1\ On May 16, 1996, the United States International 
Trade Commission (ITC) notified Commerce of its affirmative preliminary 
injury determination.
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    \1\ See Initiation of Antidumping Duty Investigation: Fresh 
Tomatoes from Mexico, 61 FR 18377 (April 25, 1996).
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    On October 10, 1996, Commerce and certain tomato growers/exporters 
from Mexico initialed a proposed agreement to suspend the AD 
investigation. On October 28, 1996, Commerce issued its 1996 
Preliminary Determination and found imports of fresh tomatoes from 
Mexico were being sold at LTFV in the United States.\2\ On the same 
day, Commerce and producers/exporters accounting for substantially all 
imports of fresh tomatoes from Mexico signed an agreement to suspend 
the investigation (1996 Agreement).\3\
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    \2\ See Notice of Preliminary Determination of Sales at Less 
Than Fair Value and Postponement of Final Determination: Fresh 
Tomatoes from Mexico, 61 FR 56608 (November 1, 1996) (1996 
Preliminary Determination).
    \3\ See Suspension of Antidumping Investigation: Fresh Tomatoes 
from Mexico, 61 FR 56618 (November 1, 1996).
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    On May 31, 2002, certain tomato growers/exporters from Mexico 
accounting for a significant percentage of all fresh tomatoes imported 
into the United States from Mexico provided written notice to Commerce 
of their withdrawal from the 1996 Agreement, effective July 30, 2002. 
Because the 1996 Agreement would no longer cover substantially all 
imports of fresh tomatoes from Mexico, effective July 30, 2002, 
Commerce terminated the 1996 Agreement, terminated the sunset review of 
the suspended investigation, and resumed the AD investigation.\4\
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    \4\ See Notice of Termination of Suspension Agreement, 
Termination of Sunset Review, and Resumption of Antidumping 
Investigation: Fresh Tomatoes from Mexico, 67 FR 50858 (August 6, 
2002).
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    On November 8, 2002, Commerce and certain tomato growers/exporters 
from Mexico initialed a proposed agreement suspending the resumed AD 
investigation on imports of fresh tomatoes from Mexico. On December 4, 
2002, Commerce and producers/exporters accounting for substantially all 
imports of fresh tomatoes from Mexico signed a new suspension agreement 
(2002 Agreement).\5\
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    \5\ See Suspension of Antidumping Investigation: Fresh Tomatoes 
from Mexico, 67 FR 77044 (December 16, 2002).
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    On November 26, 2007, certain tomato growers/exporters from Mexico 
accounting for a significant percentage of all fresh tomatoes imported 
into the United States provided written notice to Commerce of their 
withdrawal from the 2002 Agreement, effective 90 days from the date of 
their withdrawal letter (i.e., February 24, 2008), or earlier, at 
Commerce's discretion.
    On November 28, 2007, Commerce and certain tomato growers/exporters 
from Mexico initialed a new proposed agreement to suspend the AD 
investigation on imports of fresh tomatoes from Mexico. On December 3, 
2007, Commerce released the initialed agreement to interested parties 
for comment. On December 17 and 18, 2007, several interested parties 
filed comments in support of the initialed agreement.
    Because the 2002 Agreement would no longer cover substantially all 
imports of fresh tomatoes from Mexico, Commerce published a notice of 
intent to terminate the 2002 Agreement, intent to terminate the five-
year sunset review of the suspended investigation, and intent to resume 
the AD investigation.\6\ On January 16, 2008, Commerce published a 
notice of termination of the 2002 Agreement, termination of the five-
year sunset review of the suspended investigation, and resumption of 
the AD investigation, effective January 18, 2008.\7\ On January 22, 
2008, Commerce signed a new suspension agreement (2008 Agreement) with 
producers/exporters accounting for substantially all imports of fresh 
tomatoes from Mexico.\8\
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    \6\ See Fresh Tomatoes from Mexico: Notice of Intent to 
Terminate Suspension Agreement, Intent to Terminate the Five-Year 
Sunset Review, and Intent to Resume Antidumping Investigation, 72 FR 
70820 (December 13, 2007).
    \7\ See Fresh Tomatoes from Mexico: Notice of Termination of 
Suspension Agreement, Termination of Five-Year Sunset Review, and 
Resumption of Antidumping Investigation, 73 FR 2887 (January 16, 
2008).
    \8\ See Suspension of Antidumping Investigation: Fresh Tomatoes 
from Mexico, 73 FR 4831 (January 28, 2008).
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    On August 15, 2012, certain growers/exporters of fresh tomatoes 
from Mexico filed a letter with Commerce requesting consultations under 
Section IV.G \9\ of the 2008 Agreement, and Commerce agreed to consult. 
As a result of these consultations, on February 2, 2013, Commerce and 
tomato growers/exporters from Mexico accounting for a significant 
percentage of all fresh tomatoes imported into the United States from 
Mexico initialed a draft agreement that would suspend a resumed AD 
investigation on fresh tomatoes from Mexico. On February 8, 2013, 
Commerce published a notice of intent to terminate the 2008 Agreement, 
intent to terminate the five-year sunset review of the suspended 
investigation, and intent to resume the AD investigation.\10\ On March 
1, 2013, Commerce issued a notice of termination of the 2008 Agreement, 
termination of the five-year sunset review of the suspended 
investigation, and resumption of the AD investigation.\11\ On March 4, 
2013, Commerce and producers/exporters accounting for substantially all 
imports of fresh tomatoes from Mexico signed a

[[Page 49988]]

new suspension agreement (2013 Agreement).\12\
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    \9\ Section IV.G of the 2008 Agreement stated that Commerce 
would consult with signatory producers/exporters regarding the 
operations of the 2008 Agreement. A party could request such 
consultations in any April or September (i.e., prior to the 
beginning of each season) following the first year of the signing of 
the 2008 Agreement.
    \10\ See Fresh Tomatoes from Mexico: Intent To Terminate 
Suspension Agreement and Resume Antidumping Investigation and Intent 
To Terminate Sunset Review, 78 FR 9366 (February 8, 2013).
    \11\ See Fresh Tomatoes from Mexico: Termination of Suspension 
Agreement, Termination of Five-Year Sunset Review, and Resumption of 
Antidumping Investigation, 78 FR 14771 (March 7, 2013).
    \12\ See Fresh Tomatoes from Mexico: Suspension of Antidumping 
Investigation, 78 FR 14967 (March 8, 2013).
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    On January 9, 2018, Commerce issued a letter that formally opened 
consultations with CAADES et al.,\13\ the Mexican growers' 
associations, to negotiate possible revisions to the 2013 
Agreement.\14\ Since that time, Commerce has continued to negotiate 
with representatives of the Mexican producers/exporters and, in 
parallel, has continually consulted with representatives the Florida 
Tomato Exchange (FTE), a member of the U.S. petitioning industry, as 
well as other interested parties.
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    \13\ I.e., Confederaci[oacute]n de Asociaciones Agr[iacute]colas 
del Estado de Sinaloa, A.C., Consejo Agr[iacute]cola de Baja 
California, A.C., Asociaci[oacute]n Mexicana de Horticultura 
Protegida, A.C., Asociaci[oacute]n de Productores de Hortalizas del 
Yaqui y Mayo, and Sistema Producto Tomate.
    \14\ See Letter from Commerce to CAADES et al., ``Consultations 
on the 2013 Agreement Suspending the Antidumping Investigation on 
Fresh Tomatoes from Mexico,'' dated January 9, 2018.
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    On February 1, 2018, Commerce initiated a five-year sunset review 
of the suspended investigation.\15\ On March 29, 2018, the FTE filed a 
request that Commerce conduct an administrative review of producers/
exporters of fresh tomatoes from Mexico covered by the 2013 Agreement. 
On May 2, 2018, Commerce initiated the administrative review of the 
2013 Agreement.\16\ On August 27, 2018, Commerce published in the 
Federal Register the preliminary results of the five-year sunset review 
of the suspended investigation.\17\
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    \15\ See Initiation of Five-Year (Sunset) Reviews, 83 FR 4641 
(February 1, 2018).
    \16\ See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews (Initiation of Administrative Review), 83 FR 
19215 (May 2, 2018).
    \17\ See Fresh Tomatoes from Mexico: Preliminary Results of the 
Five-Year Sunset Review of the 2013 Suspension Agreement on Fresh 
Tomatoes from Mexico, 83 FR 43642 (August 27, 2018).
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    On November 14, 2018, the FTE filed a request that Commerce 
terminate the 2013 Agreement and resume the AD investigation under 
Section VI.B of the 2013 Agreement.\18\ Section VI.B of the 2013 
Agreement stated that ``the signatories or the Department may withdraw 
from this Agreement upon ninety days written notice to the other 
party.'' On November 27, 2018, the Fresh Produce Association of the 
Americas filed a rebuttal to FTE's request to terminate.\19\ On 
November 26, 2018 and November 28, 2018, respectively, CAADES et al. 
submitted responses to FTE's previous request for Commerce to terminate 
the 2013 Agreement.20 21 On December 18, 2018, NS Brands, 
Ltd (NatureSweet), a signatory to the 2013 Agreement, filed a letter in 
support of the November 28, 2018 response by the CAADES et al.\22\ On 
December 27, 2018, Commerce published in the Federal Register the final 
results of the five-year sunset review of the suspended investigation 
on fresh tomatoes from Mexico, finding that termination of the 
suspended investigation would be likely to lead to continuation or 
recurrence of dumping.\23\
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    \18\ See Letter to Wilbur Ross, Secretary of Commerce, from FTE, 
``Fresh Tomatoes from Mexico: Request to Terminate Antidumping 
Suspension Agreement,'' dated November 14, 2018.
    \19\ See Letter to Wilbur Ross, Secretary of Commerce, from the 
Fresh Produce Association of the Americas, ``Re: Fresh Tomatoes from 
Mexico: FTE's Misleading Request to Terminate Agreement,'' dated 
November 27, 2018.
    \20\ See Letter to Wilbur Ross, Secretary of Commerce, from 
CAADES et al., ``2013 Suspension Agreement on Fresh Tomatoes from 
Mexico,'' dated November 26, 2018.
    \21\ See Letter to Wilbur Ross, Secretary of Commerce, from 
CAADES et al., ``2013 Suspension Agreement on Fresh Tomatoes from 
Mexico,'' dated November 28, 2018.
    \22\ See Letter to Wilbur Ross, Secretary of Commerce, from 
NatureSweet, ``2013 Suspension Agreement on Fresh Tomatoes from 
Mexico: NS Brands' Response to Petitions Request to Terminate 2013 
Suspension Agreement,'' dated December 18, 2018.
    \23\ See Fresh Tomatoes from Mexico: Final Results of the Full 
Sunset Review of the Suspended Antidumping Duty Investigation, 83 FR 
66680 (December 27, 2018).
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    On February 6, 2019, in accordance with Section VI.B of the 2013 
Agreement, Commerce notified Mexican signatories that Commerce intended 
to withdraw from the 2013 Agreement, rescind the sunset and 
administrative reviews, and resume the AD duty investigation.\24\ Since 
the notification, as noted above, Commerce has held consultations with 
representatives of CAADES et al. and the domestic industry to discuss a 
possible suspension agreement.
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    \24\ See Fresh Tomatoes from Mexico: Intent To Terminate 
Suspension Agreement, Rescind the Sunset and Administrative Reviews, 
and Resume the Antidumping Duty Investigation, 84 FR 7872 (March 5, 
2019).
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    On May 7, 2019, because a new suspension agreement had not been 
signed, Commerce withdrew from and terminated the 2013 Agreement, 
rescinded the administrative review of that agreement, and continued 
the antidumping duty investigation.\25\ The original period of 
investigation was March 1, 1995, through February 29, 1996. Due to the 
unusual procedural posture of this proceeding, in which we terminated a 
suspension agreement and continued an investigation that covers a 
period of investigation that dates back more than 23 years, Commerce 
determined to request information corresponding to the most recent four 
full quarters, i.e., April 1, 2018 through March 31, 2019.\26\ Based on 
the unusual procedural posture, we also found it appropriate to 
reconsider respondent selection.\27\ On May 24, 2019, we selected 
Bioparques de Occidente, S.A. de C.V. (Bioparques), Ceuta Produce, S.A. 
de C.V. (Ceuta), and Negocio Agricola San Enrique, S.A. de C.V. (San 
Enrique) for individual examination in this continued 
investigation.\28\ On July 23, 2019, Commerce issued a post-preliminary 
decision based on the information requested from, and provided by, 
Bioparques, Ceuta, and San Enrique.\29\
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    \25\ See Fresh Tomatoes From Mexico: Termination of Suspension 
Agreement, Rescission of Administrative Review, and Continuation of 
the Antidumping Duty Investigation, 84 FR 20858 (May 12, 2019) 
(Continuation Notice).
    \26\ See Continuation Notice, 84 FR at 20860-61.
    \27\ Id., 84 FR at 20861.
    \28\ See Memorandum, ``Less-Than-Fair-Value Investigation of 
Fresh Tomatoes from Mexico: Respondent Selection'' (May 24, 2019).
    \29\ See Memorandum to Jeffrey I. Kessler, Assistant Secretary 
for Enforcement and Compliance, ``Post-Preliminary Decision 
Memorandum in the Less-Than-Fair-Value Investigation of Fresh 
Tomatoes from Mexico'' (July 23, 2019).
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    On August 20, 2019, Commerce and a representative of CAADES et al. 
initialed a draft agreement to suspend the antidumping investigation on 
fresh tomatoes from Mexico. Consistent with section 734(e) of the Act, 
Commerce notified the FTE and the other parties, released the initialed 
draft agreement to the interested parties, and invited interested 
parties to provide written comments on the draft suspension agreement 
by no later than the close of business on September 9, 2019.\30\ 
Consistent with 734(e)(1) of the Act, Commerce consulted with the FTE 
concerning its intention to suspend the antidumping investigation on 
fresh tomatoes from Mexico. Commerce also notified the ITC of the 
proposed agreement,\31\ consistent with 734(e)(1) of the Act, and 
released draft statutory memoranda explaining how the agreement will be 
carried out and enforced, and how the agreement will meet the 
applicable statutory requirements, consistent with section 734(e)(2) of 
the Act.\32\ Commerce received comments from numerous

[[Page 49989]]

parties by the September 9, 2019 deadline.\33\
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    \30\ See Letter to All Interested Parties, ``Draft Agreement 
Suspending the Antidumping Duty Investigation on Fresh Tomatoes,'' 
(August 20, 2019).
    \31\ See Letter to Ms. Nannette Christ, Director for Office of 
Investigations, U.S. ITC, ``Fresh Tomatoes from Mexico: Initialed 
Draft Agreement,'' (August 21, 2019).
    \32\ See Letter to All Interested Parties, ``Draft Agreement 
Suspending the Antidumping Duty Investigation on Fresh Tomatoes from 
Mexico: Draft Statutory Memoranda,'' (August 21, 2019).
    \33\ The following parties submitted comments: CAADES et al.; 
FTE; the Government of Mexico; the Tomato Division of the Fresh 
Produce Association of the Americas; NatureSweet; Red Sun Farms; 
Otay Mesa Chamber of Commerce; the Border Trade Alliance; the 
American Trucking Association; and Walmart Inc.
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    On September 19, 2019, Commerce and representatives of the 
signatory producers/exporters accounting for substantially all imports 
of fresh tomatoes from Mexico signed the 2019 Agreement Suspending the 
Antidumping Duty Investigation on Fresh Tomatoes from Mexico (2019 
Agreement), attached hereto.

Scope of Agreement

    See Section I, Product Coverage, of the 2019 Agreement.

Suspension of Investigation

    Commerce consulted with the Mexican fresh tomato producers/
exporters and the FTE and has considered the comments submitted by 
interested parties with respect to the proposal to suspend the 
antidumping investigation. In accordance with section 734(c) of the 
Act, we have determined that extraordinary circumstances are present in 
this case, as defined by section 734(c)(2)(A) of the Act.
    The 2019 Agreement provides, in accordance with 734(c)(1) of the 
Act, that the subject merchandise will be sold at or above the 
established reference price and, for each entry of each exporter, the 
amount by which the estimated normal value exceeds the export price (or 
the constructed export price) will not exceed 15 percent of the 
weighted-average amount by which the estimated normal value exceeded 
the export price (or the constructed export price) for all less-than-
fair-value entries of the producer/exporter examined during the course 
of the investigation. We have determined that the 2019 Agreement will 
eliminate completely the injurious effect of exports to the United 
States of the subject merchandise and prevent the suppression or 
undercutting of price levels of domestic fresh tomatoes by imports of 
that merchandise from Mexico, as required by section 734(c)(1) of the 
Act.
    We have also determined that the 2019 Agreement is in the public 
interest and can be monitored effectively, as required under section 
734(d) of the Act.
    For the reasons outlined above, we find that the 2019 Agreement 
meets the criteria of section 734(c) and (d) of the Act.
    The 2019 Agreement, signed September 19, 2019, is attached to this 
notice.

International Trade Commission

    In accordance with section 734(f) of the Act, Commerce has notified 
the ITC of the 2019 Agreement.

Suspension of Liquidation

    The suspension of liquidation ordered following the May 7, 2019 
continuation of the investigation shall continue to be in effect, 
subject to section 734(h)(3) of the Act.\34\ Section 734(f)(2)(B) of 
the Act provides that Commerce may adjust the security required to 
reflect the effect of the 2019 Agreement. Commerce has found that the 
2019 Agreement eliminates completely the injurious effects of imports 
and, thus, Commerce is adjusting the security required from signatory 
producers/exporters to zero. The security rates in effect for imports 
from any non-signatory producers/exporters, which are based on the 
preliminary dumping margins, remain as published in the Continuation 
Notice. If there is no request for review of suspension under section 
734(h) of the Act, or if the ITC conducts a review and finds that the 
injurious effect of imports of the subject merchandise is eliminated 
completely by the 2019 Agreement, Commerce will terminate the 
suspension of liquidation of all entries of fresh tomatoes from Mexico, 
and refund any cash deposits collected on entries of fresh tomatoes 
from Mexico consistent with section 734(h)(3) of the Act.
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    \34\ See Continuation Notice, 84 FR at 20861.
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    Notwithstanding the 2019 Agreement, Commerce will continue the 
investigation if it receives such a request within 20 days after the 
date of publication of this notice in the Federal Register, in 
accordance with section 734(g) of the Act.

Administrative Protective Order Access

    The Administrative Protective Order (APO) Commerce granted in the 
investigation segment of this proceeding remains in place. While the 
investigation is suspended, parties subject to the APO may retain, but 
may not use, information received under that APO. All parties wishing 
access to business proprietary information submitted during the 
administration of the 2019 Agreement must submit new APO applications 
in accordance with Commerce's regulations currently in effect.\35\ An 
APO for the administration of the 2019 Agreement will be placed on the 
record within five days of the date of publication of this notice in 
the Federal Register.
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    \35\ See Section 777(c)(1) of the Act; see also 19 CFR 351.103, 
351.304, 351.305, and 351.306.
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    We are issuing and publishing this notice in accordance with 
section 734(f)(1)(A) of the Act.

     Dated: September 19, 2019.
Jeffrey I. Kessler
Assistant Secretary for Enforcement and Compliance.

Attachment

Agreement Suspending the Antidumping Duty Investigation on Fresh 
Tomatoes From Mexico

    Pursuant to section 734(c) of the Tariff Act of 1930, as amended 
(the Act) (19 U.S.C. 1673c(c)), and 19 CFR 351.208 (2018),\36\ the 
U.S. Department of Commerce (Commerce) and the Signatory producers/
exporters of fresh tomatoes from Mexico (individually, Signatory; 
collectively, Signatories) enter into this Agreement Suspending the 
Antidumping Duty Investigation on Fresh Tomatoes from Mexico 
(Agreement).
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    \36\ The resumption of the investigation and negotiation of a 
new suspension agreement were conducted in accordance with 
Commerce's regulations in effect at the time of the original 
investigation, 19 CFR 353.18 (1996). Because this Agreement 
constitutes a new segment of the proceeding, the Agreement is 
governed by the regulations currently in effect. 19 CFR 351.701; see 
also San Vicente Camalu SPR de Ri v. United States, 491 F. Supp. 2d 
1186 (CIT 2007).
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I. Product Coverage

    The merchandise subject to this Agreement is all fresh or 
chilled tomatoes (fresh tomatoes) which have Mexico as their origin, 
except for those tomatoes which are for processing. For purposes of 
this Agreement, processing is defined to include preserving by any 
commercial process, such as canning, dehydrating, drying, or the 
addition of chemical substances, or converting the tomato product 
into juices, sauces, or purees. In Appendix F of this Agreement, 
Commerce has outlined the procedure that Signatories must follow for 
selling subject merchandise for processing. Fresh tomatoes that are 
imported for cutting up, not further processing (e.g., tomatoes used 
in the preparation of fresh salsa or salad bars), are covered by 
this Agreement.
    Commercially grown tomatoes, both for the fresh market and for 
processing, are classified as Lycopersicon esculentum. Important 
commercial varieties of fresh tomatoes include common round, cherry, 
grape, plum, greenhouse, and pear tomatoes, all of which are covered 
by this Agreement.
    Tomatoes imported from Mexico covered by this Agreement are 
classified under the following subheading of the Harmonized Tariff 
Schedules of the United States (HTSUS), according to the season of 
importation: 0702. Although this HTSUS number is provided for 
convenience and customs purposes, the written description of the 
scope of this Agreement is dispositive.

[[Page 49990]]

II. Definitions

    For purposes of the Agreement, the following definitions apply:
    A. ``Anniversary Month'' means the month in which the Agreement 
becomes effective.
    B. ``Buyer'' means the first unaffiliated customer in the United 
States that takes title of the subject merchandise.
    C. ``Effective Date'' means the date on which Commerce and the 
Signatories sign the Agreement.
    D. ``Fresh Tomatoes'' means the product described under section 
I, ``Product Coverage,'' of the Agreement.
    E. ``Grower Association'' means a Mexican grower association 
whose members produce and/or export Fresh Tomatoes from Mexico and 
are also Signatories to this Agreement, e.g., Confederaci[oacute]n 
de Asociaciones Agr[iacute]colas del Estado de Sinaloa, A.C.; 
Consejo Agr[iacute]cola de Baja California, A.C.; Asociaci[oacute]n 
Mexicana de Horticultura Protegida, A.C.; Asociaci[oacute]n de 
Productores de Hortalizas del Yaqui y Mayo, and Sistema Producto 
Tomate.
    F. ``Interested Party'' means any person or entity that meets 
the definitions provided in section 771(9) of the Act.
    G. ``Mexico'' means the customs territory of the United Mexican 
States and foreign trade zones within the territory of Mexico.
    H. ``Organic Tomatoes'' means Fresh Tomatoes produced by a 
production system that has been certified ``organic'' by the U.S. 
Department of Agriculture, is labeled as ``organic,'' and may 
include Round, Roma, Specialty, Stem On, and Tomatoes on the Vine 
Fresh Tomatoes (see, respectively, sections II.K, II.L, II.N, II.Q, 
and II.S).
    I. ``PACA'' means the Perishable Agricultural Commodities Act of 
1930, as amended (7 U.S.C. 499a et seq.).
    J. ``Reference Price'' means the minimum price at which 
merchandise subject to this Agreement can be sold in the United 
States.
    K. ``Round'' means round Fresh Tomatoes, whether mature green or 
vine ripe, not including any Stem On tomatoes, regardless of growing 
method or type of packing.
    L. ``Roma'' means roma or plum Fresh Tomatoes, whether mature 
green or vine ripe, not including any Stem On tomatoes, regardless 
of growing method or type of packing.
    M. ``Selling Agent'' means any entity (e.g., importer, agent, 
distributor, or entity meeting the definition of ``commission 
merchant,'' ``dealer,'' or ``broker,'' as those terms are defined in 
section 1(b) of the PACA (7 U.S.C. 499a(b))) that facilitates the 
sale to the Buyer.
    N. ``Specialty'' means grape, cherry, heirloom, cocktail Fresh 
Tomatoes, or any other tomato varietal, other than Round and Roma 
tomatoes, with or without stem.
    O. ``Specialty--Loose'' means Specialty Fresh Tomatoes not in 
packaging.
    P. ``Specialty--Packed'' means Specialty Fresh Tomatoes in 
packaging.
    Q. ``Stem On'' means any type of Fresh Tomato, except Specialty 
and Tomatoes on the Vine, with some or all of the stem attached.
    R. ``Substantially all'' of the subject merchandise means not 
less than 85 percent by value or volume of the imports of subject 
merchandise.
    S. ``Tomatoes on the Vine'' means any type of Fresh Tomato, 
except Specialty, in which there are two or more tomatoes, typically 
in a cluster, with the vine attached; such tomatoes include single 
tomatoes of the same type that are found in the same package with 
the tomato clusters herein defined.
    T. ``United States'' means the customs territory of the United 
States of America (the 50 States, the District of Columbia, and 
Puerto Rico) and foreign trade zones located within the territory of 
the United States.
    U. ``USDA'' means the United States Department of Agriculture.
    V. ``Violation'' means noncompliance with the terms of the 
Agreement, whether through an act or omission, except for 
noncompliance that is inconsequential or inadvertent, and does not 
materially frustrate the purposes of the Agreement. See section VIII 
for examples of activities that may be deemed by Commerce to be 
Violations.
    W. ``Working Group'' means the joint working group established 
on August 23, 2013 between the Mexican tomato industry and the 
Government of Mexico for purposes of regularly monitoring and 
reconciling Fresh Tomatoes from Mexico export data and identifying 
and addressing any inconsistencies or irregularities.
    Any term or phrase not defined by this section shall be defined 
using either a definition provided in the Act for that term or 
phrase, or the plain meaning of that term, as appropriate.

III. Suspension of Investigation

    As of the Effective Date, in accordance with section 734(c) of 
the Act and 19 CFR 351.208, Commerce will suspend its antidumping 
duty investigation on Fresh Tomatoes from Mexico initiated on April 
18, 1996.\37\
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    \37\ See Initiation of Antidumping Duty Investigation: Fresh 
Tomatoes From Mexico, 61 FR 18377 (April 25, 1996).
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IV. U.S. Import Coverage

    In accordance with section 734(c)(1) of the Act, the Signatories 
are the producers and/or exporters in Mexico which account for 
substantially all of the subject merchandise imported into the 
United States. Commerce may at any time during the period of the 
Agreement require additional producers/exporters in Mexico to sign 
the Agreement in order to ensure that not less than substantially 
all imports into the United States are subject to the Agreement.

V. Statutory Conditions for the Agreement

    In accordance with section 734(c) of the Act, Commerce has 
determined that extraordinary circumstances are present in this 
investigation because the suspension of the investigation will be 
more beneficial to the domestic industry than the continuation of 
the investigation and that the investigation is complex.
    In accordance with section 734(d) of the Act, Commerce 
determines that the suspension of the investigation is in the public 
interest and that effective monitoring of the Agreement by the 
United States is practicable. Section 734(a)(2)(B) of the Act 
provides that the public interest includes the availability of 
supplies of the merchandise and the relative impact on the 
competitiveness of the domestic industry producing the like 
merchandise, including any such impact on employment and investment 
in that industry. Accordingly, if a domestic producer requests an 
administrative review of the status of, and compliance with, the 
Agreement, Commerce will take these factors into account in 
conducting that review. If Commerce finds that the Agreement is not 
working as intended in this regard, Commerce will explore all 
appropriate measures, including renegotiation of the terms of the 
Agreement to resolve the problem or measures under section 751(d)(1) 
of the Act.

VI. Price Undertaking

    In order to satisfy the requirements of section 734(c)(1)(A) of 
the Act, each Signatory individually agrees that, to prevent price 
suppression or undercutting, it will not sell in the United States, 
on and after the Effective Date of the Agreement, merchandise 
subject to the Agreement at prices that are less than the Reference 
Prices established in Appendix A.
    In order to satisfy the requirements of section 734(c)(1)(B) of 
the Act, each Signatory individually agrees that for each entry the 
amount by which the estimated normal value exceeds the export price 
(or the constructed export price) will not exceed 15 percent of the 
weighted average amount by which the estimated normal value exceeded 
the export price (or the constructed export price) for all less-
than-fair-value entries of the producer/exporter examined during the 
course of the investigation, in accordance with the Act and 
Commerce's regulations and procedures, including but not limited to 
the calculation methodologies described in Appendix B.

VII. Monitoring of the Agreement

A. Import Monitoring

    1. The Signatories will maintain the Working Group, which will 
regularly monitor and reconcile Mexican export data and identify and 
address any inconsistencies or irregularities. The Working Group 
will refer any alleged Violations (either those discovered during 
its monitoring exercises or those reported by Commerce) to the 
Mexican Government for appropriate action. For further information, 
please see information provided at: https://enforcement.trade.gov/tomato.
    2. Commerce will monitor entries of Fresh Tomatoes from Mexico 
to ensure compliance with section VI of this Agreement.
    3. Commerce will review, and place on the official record, 
publicly available data and other official import data, including, 
as appropriate, records maintained by U.S. Customs and Border 
Protection (CBP), to determine whether there have been imports that 
are inconsistent with the provisions of this Agreement.
    4. Commerce will review, as appropriate, data it receives from 
the Working Group and through any data exchange program between U.S. 
and Mexican government agencies, to determine whether there have 
been imports that are inconsistent with the provisions of this 
Agreement.

[[Page 49991]]

    5. An interagency task force between Commerce, USDA, and CBP 
will review data and information, as appropriate, and coordinate 
enforcement action, as necessary.

B. Compliance Monitoring

    1. Commerce may require, and each Signatory agrees to provide, 
confirmation, through documentation provided to Commerce, that the 
price received on any sale subject to this Agreement was not less 
than the established Reference Price. Commerce may require that such 
documentation be provided and be subject to verification.
    2. Commerce may require, and each Signatory agrees to report in 
the prescribed format and using the prescribed method of data 
compilation, each sale of the merchandise subject to this Agreement, 
made either directly or indirectly to Buyers in the United States, 
including each adjustment applicable to each sale, as specified by 
Commerce. Each Signatory agrees to permit review and on-site 
inspection of all information deemed necessary by Commerce to verify 
the reported information.
    3. Commerce may initiate administrative reviews under section 
751(a) of the Act in the month immediately following the Anniversary 
Month, upon request or upon its own initiative, to ensure that 
exports of Fresh Tomatoes from Mexico satisfy the requirements of 
section 734(c)(1)(A) and (B) of the Act. Commerce may perform 
verifications pursuant to administrative reviews conducted under 
section 751 of the Act.
    4. At any time it deems appropriate, and without prior notice, 
Commerce shall conduct verifications of parties handling Signatory 
merchandise (e.g., Signatory producers and/or exporters and Selling 
Agents) to determine whether they are selling Signatory merchandise 
in accordance with the terms of this Agreement. Commerce shall also 
conduct verifications at the Grower Association level at locations 
and times it deems appropriate to ensure compliance with the terms 
of the Agreement. Commerce may conduct periodic verifications, in 
Mexico, at border-crossing locations, or through questionnaires 
issued by Commerce, to spot check compliance.
    5. The Working Group shall provide to Commerce a quarterly 
report on all issues submitted by Commerce to the Working Group for 
investigation under the Agreement. In addition, the Working Group 
shall provide to Commerce an annual report on all activities 
undertaken, to include information on any allegation of a Violation 
of the Agreement, information uncovered during investigations, and 
the results of/resolution to the issue. Commerce shall place such 
reports on the official record of the Agreement.
    6. Commerce and the Signatory producers/exporters shall hold 
periodic meetings, as necessary, e.g., more frequently during the 
peak season, to discuss monitoring and enforcement matters.
    7. Commerce shall sample up to 40 Signatories on a quarterly 
basis, within 30 days of the end of each quarter, from which to 
request detailed information related to each sale of any type of 
subject tomato. With good cause, to include any issues identified 
pursuant to inspection under section VII.C, Commerce may sample more 
than 40 Signatories under this paragraph. Commerce shall request 
information including: Date on which it entered into a contract for 
the sale of Signatory tomatoes with each Selling Agent during that 
quarter; name of the Selling Agent; quantity of tomatoes to be 
supplied under that contract; and price of the tomatoes sold under 
each contract. Further, the sampled Signatories shall submit to 
Commerce the following information: Export license number, quantity 
exported under that license; price of such tomatoes; importer of 
record for each shipment, Selling Agent(s), if any, involved in the 
sale; the Buyer (if known); USDA inspection reports for the required 
inspections under section VII.C, if applicable; and records to 
support any return or destruction of tomato lots \38\ pursuant to 
those inspections. All information must be submitted to Commerce in 
electronic format, including Microsoft Excel reporting of all data 
contained therein. Signatories selected for sampling pursuant to 
this paragraph shall be given at least 30 days to submit the 
information requested by Commerce.
---------------------------------------------------------------------------

    \38\ For purposes of the Agreement, a lot is defined as a 
grouping of tomatoes in a particular shipment that is 
distinguishable by packing type.
---------------------------------------------------------------------------

    8. Through a contractual arrangement, Signatories shall require 
their Selling Agents to respond to Commerce's requests for 
information concerning sales of any type of Signatory tomatoes. 
Commerce shall sample up to 40 Selling Agents on a quarterly basis, 
within 30 days of the end of each quarter, from which to request 
information. With good cause, to include any issues identified 
pursuant to inspections under section VII.C, Commerce can sample 
more than 40 Selling Agents under this paragraph. Commerce shall 
request information including: The date during the quarter on which 
it entered into a contract for sale of Signatory tomatoes, the name 
of that Signatory, the quantity of tomatoes to be supplied under 
that contract and the price, and the pre-season letter sent by the 
Selling Agent to the Buyer. The sampled Selling Agent shall submit 
to Commerce each quarter the quantity of Signatory tomatoes it 
imports from each Signatory and the quantity of Signatory tomatoes 
it sells on behalf of each Signatory, and, as applicable, USDA 
inspection reports for the required inspections under section VII.C, 
if applicable; and records to support any return or destruction of 
tomato lots pursuant to those inspections. Each sampled Selling 
Agent shall also submit to Commerce a listing of each sale of 
Signatory tomatoes it makes to a Buyer during the quarter, including 
the name of the Buyer, quantity sold by category of tomato, and the 
price. All information must be submitted to Commerce in electronic 
format, including Microsoft Excel reporting of all data contained 
therein. Selling Agents selected for sampling pursuant to this 
paragraph shall be given at least 30 days to submit the information 
requested by Commerce.

C. Inspection of Subject Merchandise

    1. Beginning approximately (and no less than) six months from 
the Effective Date of the Agreement, all loads of subject 
merchandise, as specified in paragraph 2 of this section, shall be 
subject to a USDA inspection for quality and condition defects near 
the border after entering the United States.\39\ Commerce will 
consult with USDA on the development and implementation of the 
inspection program. The trade community will have at least 60 days' 
advance notice prior to implementation of the inspection program. 
For avoidance of doubt, all loads of Fresh Tomatoes from Mexico that 
are inspected pursuant to a USDA marketing order are not required to 
also be inspected pursuant to the inspection program under this 
section VII.C.
---------------------------------------------------------------------------

    \39\ The timelines specified in section VII.C.1 will be tolled 
per any Commerce tolling instituted during the relevant periods.
---------------------------------------------------------------------------

    2. USDA shall inspect the following loads of Fresh Tomatoes from 
Mexico: All Round and Roma tomatoes (including Stem On) and grape 
tomatoes in bulk. The following Fresh Tomatoes are excluded from the 
inspection requirement: Tomatoes on the Vine, Specialty tomatoes, 
and grape tomatoes in retail packages of 2 pounds or less. When the 
load is available for inspection, the importer \40\ must request the 
USDA inspection and pay the associated USDA fees. Inspections will 
be performed in a timely manner. A USDA inspector will normally 
arrive and complete the inspection within 48 hours of receiving an 
importer's official request for inspection. At locations that 
normally have USDA inspectors in the area, a USDA inspector will 
normally arrive and complete the inspection within 24 hours of the 
official request for inspection by the importer.
---------------------------------------------------------------------------

    \40\ As defined in 19 CFR 101.1 of CBP's regulations.
---------------------------------------------------------------------------

    3. USDA will perform inspections (an unrestricted certification) 
in accordance with its normal practice to determine quality, 
condition, and grade pursuant to the appropriate USDA standard 
covering fresh tomatoes and greenhouse tomatoes and using shipping 
point tolerances. All tomatoes must grade to at least U.S. No. 2. 
The current, applicable USDA standards are as follows:
    a. U.S. No. 1, U.S. Combination, or U.S. No. 2 of the U.S. 
Standards for Grades of Fresh Tomatoes (for shipping point 
tolerances see 51.1861 of the aforementioned U.S. Standards).
    b. U.S. No. 1 or U.S. No. 2 of the U.S. Standards for Grades of 
Greenhouse Tomatoes (for tolerances see 51.3348 of the 
aforementioned U.S. Standards).
    4. After the USDA inspection, the importer will receive an 
inspection certificate, which must be maintained by the importer and 
is subject to submission to, and verification by, Commerce, 
consistent with the importer's contractual obligation with the 
Signatory. If a lot of Signatory tomatoes has more defects than the 
tolerances established in the USDA standards, then the importer may 
opt either to recondition and re-inspect the lot, or return it to 
Mexico. In the event of reconditioning and re-inspection, any culls

[[Page 49992]]

must be destroyed under USDA supervision. Proof of reconditioning 
and re-inspection must be maintained by the importer and is subject 
to submission to, and verification by, Commerce, consistent with the 
importer's contractual obligation with the Signatory. Alternatively, 
in the event of return to Mexico, the entire lot must be returned to 
Mexico or destroyed under USDA oversight, with a USDA certificate 
provided to the importer as proof of destruction. The Signatory will 
be responsible for paying all expenses related to the return of the 
entire lot to Mexico or its destruction. Proof of such return or 
destruction must be maintained by the importer and is subject to 
submission to, and verification by, Commerce, consistent with the 
importer's contractual obligation with the Signatory.
    5. Upon implementation of the inspection program, each Signatory 
must ensure, through a contractual arrangement with the appropriate 
party, that the importer for all imports of Fresh Tomatoes from 
Mexico from the Signatory requests the USDA inspection, as indicated 
above in section VII.C.2, and maintains the documentation specified 
in section VII.C.4. Similarly, upon implementation of the inspection 
program, Signatories must ensure, through a contractual arrangement 
with the appropriate party, that all lots of tomatoes that do not 
pass the USDA inspection are either reconditioned and re-inspected, 
or returned to Mexico, as indicated above. Signatories must maintain 
proof of these contractual arrangements, provide such records to 
Commerce upon request, and make them available for verification by 
Commerce at any time.
    6. Signatories and Selling Agents, as applicable, must maintain 
a copy of the Mexican export license, USDA inspection reports, and 
entry documents associated with each entry of Signatory tomatoes 
into the United States, as well as records to support any return or 
destruction of tomato lots under section VII.C.4. Signatories and 
Selling Agents, as applicable, must provide these records to 
Commerce upon request and make them available for verification by 
Commerce at any time.

D. Shipping and Other Arrangements

    1. All Reference Prices will be expressed in U.S. Dollars ($) 
per pound (lb.) in accordance with Appendix A. All Reference Prices 
are FOB U.S. shipping point, i.e., to the U.S. side of the U.S.-
Mexico border. The Reference Price includes all palletizing and 
cooling charges incurred prior to shipment from the Mexican shipping 
point, i.e., from the Mexican side of the U.S.-Mexico border. The 
delivered sales price to a Buyer for all Fresh Tomatoes from Mexico 
exported directly, or indirectly through a third country, to the 
United States shall include all movement and handling expenses 
beyond the point of entry into the United States (e.g., McAllen, 
Nogales, or Otay Mesa) and in excess of the Reference Price, i.e., 
the FOB U.S. shipping point price.
    2. The parties to this Agreement acknowledge that, in accordance 
with Mexican regulations, Mexican tomato producers and non-producer 
exporters exporting to the United States will become Signatories to 
the Agreement. Signatories will fully comply with all requirements 
of Mexican regulations concerning identification, tracking, 
verification and inspection by the relevant Mexican authorities 
including the Ministry of Economy (SECON), the Ministry of 
Agriculture (SAGARPA), SAGARPA's National Food Health, Safety and 
Quality Service (SENASICA) and Customs. Signatory producers will be 
required to formally assign volumes, through SECON, sold in Mexico 
to another party as a condition for that party to obtain an export 
notice (i.e., an aviso autom[aacute]tico). In accordance with 
Mexican regulations, non-compliance will result in the revocation of 
export privileges. In addition, exporting Fresh Tomatoes to the 
United States under a Signatory number different than one's own 
Signatory number may result in revocation of a Signatory's export 
license in Mexico. For further information, please see information 
provided at: https://enforcement.trade.gov/tomato.
    3. Signatories agree not to take any action that would 
circumvent or otherwise evade, or defeat the purpose of, this 
Agreement. Signatories agree to undertake any measures that will 
help to prevent circumvention. For example, each Signatory will take 
the following actions:
    a. It is the responsibility of each Signatory to ensure that 
each sale of its merchandise is made consistent with the 
requirements of this Agreement and all its Appendices. To that end, 
each Signatory shall enter into a contract with the Selling 
Agent(s), if the sale is made indirectly to the Buyer, or with the 
Buyer, if the sale is made directly to the Buyer, that incorporates 
the terms of this Agreement. This contractual arrangement must 
establish that the Selling Agent maintain documentation 
demonstrating that sales of subject merchandise are made consistent 
with the requirements of this Agreement. Further, if the Signatory's 
sale to the Buyer is made through a Selling Agent, the Selling Agent 
shall incorporate the terms of this Agreement into its contract with 
the Buyer. It is the responsibility of each Signatory to confirm and 
ensure any such Selling Agent(s) and Buyer(s) hold a valid and 
effective license issued pursuant to the PACA, to the extent 
required by the PACA.\41\ All contractual arrangements will specify 
that parties in the distribution chain from the Signatory to the 
Buyer will maintain documentation as required by the PACA and as 
consistent with the requirements of the Agreement.
---------------------------------------------------------------------------

    \41\ This may be done by using ``PACA SEARCH'' on the PACA 
website at www.usda.gov/paca, or by calling the PACA National 
License Center Customer Service line at 1-800-495-7222, ext #1.
---------------------------------------------------------------------------

    b. Each Signatory will label its boxes of subject merchandise 
that are exported to the United States with its name, Signatory 
identification number, and a statement that ``These Tomatoes Were 
Grown/Exported By a Signatory of the 2019 Suspension Agreement.'' 
\42\ Alternatively, if the Signatory that exports the subject 
merchandise is different from the entity that produced the subject 
merchandise, it will label the boxes with its name and its Signatory 
identification number. Each Signatory also will label its boxes with 
the type of tomato being shipped in the box, i.e., Round, Roma, 
Specialty, Stem On, or Tomatoes on the Vine.
---------------------------------------------------------------------------

    \42\ Signatories may continue to use boxes with markings from 
the 2013 Suspension Agreement through three months from the 
Effective Date, but they must add the type of tomato being shipped 
to the existing labeling on the box, i.e., Round, Roma, Specialty, 
Stem On, or Tomatoes on the Vine.
---------------------------------------------------------------------------

    c. Each Signatory will label its boxes of fresh tomatoes sold in 
Mexico with its name, Signatory number, and the statement 
``Prohibida Su Exportacion a los EUA/Not for Export to the United 
States.''
    4. Not later than 30 days after the end of each quarter,\43\ 
each Signatory must submit a certification to Commerce. Through a 
contractual arrangement, Signatories shall require their Selling 
Agents to provide information necessary for inclusion in the 
Signatories' quarterly certification. Each Signatory agrees to 
permit full verification of its certification as Commerce deems 
necessary. Signatories can obtain a copy of the suggested forms for 
submitting the quarterly certification information from Commerce's 
website at: https://enforcement.trade.gov/tomato. Quarterly 
certifications must be submitted to Commerce in electronic format, 
including Microsoft Excel reporting of all data contained therein. 
The certification must include:
---------------------------------------------------------------------------

    \43\ The quarters are December 1-February 28, March 1-May 31, 
June 1-August 30, and September 1-November 30.
---------------------------------------------------------------------------

    a. A written statement to Commerce certifying that the invoice 
price for all sales of its Fresh Tomatoes made during the most 
recently completed quarter (after rebates, backbilling, discounts 
for quality, and other claims) were at or above the Reference Prices 
in effect, were not part of or related to any act or practice which 
would have the effect of hiding the real price of the Fresh Tomatoes 
being sold (e.g., a bundling arrangement, on-site processing 
arrangement, commingling tomato products, discounts/free goods/
financing package, end-of-year rebates, free freight, and/or a swap 
or other exchange), and were otherwise consistent with the terms of 
the Agreement.
    b. The total quantity and value of tomatoes by tomato type sold 
during the most recently completed quarter (whether directly or via 
a Selling Agent), and the total quality and condition defect sales 
adjustments granted, as applicable, pursuant to Appendix D. For any 
sales adjustments, the Signatory must report the number of lots on 
which claims for quality and condition defects were granted, the 
total volume of tomatoes destroyed, the total value of claims 
granted, and the total value of payments made to the Buyer by the 
Signatory and/or Selling Agent.
    c. All USDA-issued certifications showing destruction of any 
defective tomatoes pursuant to Appendix D.
    d. Documentation of any return of rejected lots to Mexico, 
pursuant to Appendix D, and a written statement that there were no 
additional rejections beyond those being provided.
    e. The volume of a Signatory producer's registered production 
that is assigned to any

[[Page 49993]]

other party for export to the United States and the name of that 
party.
    f. The volume of each Signatory exporter's (e.g., a non-producer 
exporter) registered production assigned to it for export to the 
United States by a Signatory producer(s) and the name of the 
Signatory producer(s).
    g. A statement acknowledging the Signatory's understanding that 
intentional Violations of the Agreement are subject to additional 
civil penalties per section VIII.B of the Agreement.
    h. Alternatively, a written statement to Commerce, if the 
Signatory did not export Fresh Tomatoes to the United States, 
certifying that it made no sales to the United States during the 
most recently completed quarter.

E. Rejection of Submissions

    Commerce may reject: (1) Any information submitted after the 
deadlines set forth in this Agreement; (2) any submission that does 
not comply with the filing, format, translation, service, and 
certification of documents requirements under 19 CFR 351.303; (3) 
submissions that do not comply with the procedures for establishing 
business proprietary treatment under 19 CFR 351.304; (4) submissions 
that do not comply with any other applicable regulations, as 
appropriate, or any information that it is unable to verify to its 
satisfaction. If information is not submitted in a complete and 
timely fashion or is not fully verifiable, Commerce may use facts 
otherwise available for the basis of its decision, as it determines 
appropriate, consistent with section 776 of the Act.

F. Compliance Consultations

    1. When Commerce identifies, through import or compliance 
monitoring or otherwise, that sales may have been made at prices 
inconsistent with section VI of this Agreement, Commerce will notify 
each Signatory which it believes is responsible through their Grower 
Associations' counsel or directly, in the event that the Signatory 
is not represented by counsel. Commerce will consult with each such 
party for a period of up to 60 days to establish a factual basis 
regarding sales that may be inconsistent with section VI of this 
Agreement.
    2. During the consultation period, Commerce will examine any 
information that it develops or which is submitted, including 
information requested by Commerce under any provision of this 
Agreement.
    3. If Commerce is not satisfied at the conclusion of the 
consultation period that sales by such Signatory are being made in 
compliance with this Agreement, Commerce may evaluate under section 
751 of the Act, or section 19 CFR 351.209, whether this Agreement is 
being violated, as defined in section VIII.E of this Agreement, by 
such Signatory. Without prejudice to the provisions of section XI of 
this Agreement, in no event will Commerce terminate the Agreement 
under this provision outside of the scope of a review under section 
751.

G. Operations Consultations

    Commerce will consult with the Signatories regarding the 
operations of this Agreement. The Signatories or Commerce may 
request such consultations, as necessary.
    The Signatories and Commerce may agree to revise the Reference 
Prices subject to consultations.

VIII. Violations of the Agreement

    A. If Commerce determines that there has been a Violation of the 
Agreement or that the Agreement no longer meets the requirements of 
sections 734(c) or (d) of the Act, Commerce shall take action it 
determines appropriate under section 734(i) of the Act and 
Commerce's regulations.
    B. Pursuant to section 734(i) of the Act, Commerce will refer 
any intentional Violations of the Agreement to CBP. Any person who 
intentionally commits a Violation of the Agreement shall be subject 
to a civil penalty assessed in the same amount, in the same manner, 
and under the same procedures as the penalty imposed for a 
fraudulent violation of section 592(a) of the Act. A fraudulent 
violation of section 592(a) of the Act is punishable by a civil 
penalty in an amount not to exceed the domestic value of the 
merchandise. For purposes of the Agreement, the domestic value of 
the merchandise will be deemed to be not less than the Reference 
Price, as the Signatories agree not to sell the subject merchandise 
at prices that are less than the Reference Price or to ensure that 
sales of the subject merchandise are made consistent with the terms 
of the Agreement.
    C. In addition, Commerce will examine the activities of 
Signatories, Selling Agents, and any other party to a sale subject 
to the Agreement to determine whether any activities conducted by 
any party aided or abetted another party's Violation of the 
Agreement. If any such parties are found to have aided or abetted 
another party's Violation of the Agreement, they shall be subject to 
the same civil penalties described in section VIII.B above.
    Signatories to this Agreement consent to the release of all 
information presented to or obtained by Commerce during the conduct 
of verifications to CBP and/or USDA. Further, through a contractual 
arrangement, Signatories shall require that the Selling Agent(s) 
consent to the release of all information presented to or obtained 
by Commerce during the conduct of verifications to CBP and/or USDA.
    D. Any Violation of the terms of this Agreement by a PACA 
licensee may be deemed by the PACA Division as ``unfair conduct'' in 
accordance with the PACA.\44\ Commerce, a Signatory, or any other 
interested person may file with the Secretary of Agriculture a 
written notification of any alleged violation of the PACA pursuant 
to section 6(b) of the PACA (7 U.S.C. 499f(b)). Upon receipt of a 
written notification, the PACA Division will examine the allegation 
and determine whether further investigation, issuance of a letter of 
warning, or administrative complaint is warranted. Failure of a PACA 
licensee to cooperate with an ongoing investigation can lead to 
suspension of license and publication thereof. When an 
administrative complaint is filed, a finding by an administrative 
law judge that a PACA licensee or an entity operating subject to 
license has engaged in repeated and flagrant violations of the PACA 
can result in the assessment of a civil penalty, or suspension or 
revocation of the PACA license and/or publication thereof. Ensuing 
licensing and employment restrictions are mandated by the PACA 
Division. Notice of disciplinary actions taken against a licensee or 
an entity subject to license is released to the public.
---------------------------------------------------------------------------

    \44\ Although not a party to this Agreement, the actions of a 
Buyer who is a PACA licensee or is operating subject to license that 
aid or abet a Violation of the Agreement may constitute an unfair 
trade practice that violates the PACA.
---------------------------------------------------------------------------

    E. Examples of activities which Commerce may deem to be 
Violations of the Agreement include:
    1. Sales in which the invoice prices of subject merchandise 
(after rebates, backbilling, discounts for quality, and other 
claims) are below the Reference Price.
    2. Any act or practice which would have the effect of hiding the 
real price of the Fresh Tomatoes from Mexico being sold (e.g., a 
bundling arrangement, on-site processing, commingling tomato 
products, discounts/free goods financing package, end-of-year 
rebates, free freight, or a swap or other exchange).
    3. Failure to request a USDA inspection on a load in accordance 
with section VII.C.2.
    4. Failure to comply with the requirements of sections VII.C.4, 
VII.C.5, or VII.C.6.
    5. Labeling boxes in a manner that is inconsistent with the 
labeling provisions of section VII.D.3.b above to circumvent this 
Agreement.
    6. Sales of exports that were not properly assigned by a 
Signatory producer to a non-producer Signatory through SECON and are 
therefore inconsistent with section VII.D.2.
    7. Failure to provide a quarterly certification in accordance 
with section VII.D.4.
    8. Repeated or routine over filling of boxes beyond reasonable 
variations in weights for the apparent purpose of circumventing this 
Agreement.
    9. A Signatory's failure to notify Commerce of intended 
shipments of Fresh Tomatoes from Mexico in boxes for which there is 
no average weight on the box weight chart in accordance with 
Appendix C.
    10. Sales that are not in accordance with the terms and 
conditions applied by Commerce when calculating net sales prices for 
transactions involving adjustments due to changes in quality and 
condition after shipment as detailed in Appendix D of this 
Agreement.
    11. Selling Signatory tomatoes to Canada in a manner that is not 
consistent with the requirements of Appendix E of this Agreement.
    12. Selling Signatory tomatoes for processing in the United 
States in a manner that is not consistent with the requirements of 
Appendix F of this Agreement.
    13. Exporting Fresh Tomatoes from Mexico to the United States 
under a Signatory number different than one's own Signatory number.
    14. Failure to comply with the terms of this Agreement.
    15. Any other act or practice that Commerce finds is in 
violation of this Agreement.

[[Page 49994]]

IX. Other Provisions

    A. In entering into this Agreement, the Signatories do not admit 
that any exports of Fresh Tomatoes from Mexico are having or have 
had an injurious effect on fresh tomato producers in the United 
States, have caused the suppression or undercutting of prices, or 
have been sold at less than fair value.
    B. Upon request, Commerce will advise any Signatory of 
Commerce's methodology for calculating its export price (or 
constructed export price) and normal value in accordance with the 
Act and Commerce's regulations and procedures, including but not 
limited to, the calculation methodologies described in Appendix B of 
this Agreement.

X. Disclosure and Comment

    This section provides the terms for disclosure and comment 
following consultations or during segments of the proceeding not 
involving a review under section 751 of the Act.
    A. If Commerce proposes to revise the Reference Price(s) as a 
result of agreement between the parties pursuant to consultations 
under section VII.G of this Agreement, Commerce will disclose the 
preliminary Reference Price(s), including calculation methodology 
and all information or data from which that methodology is derived, 
not less than 30 days before the date on which the price(s) would 
become final and effective.
    B. Not later than seven days after the date of disclosure under 
paragraph X.A, Interested Parties may submit written comments 
concerning the proposed Reference Price(s) to Commerce, not to 
exceed fifteen pages. After reviewing these submissions and after 
consultations with the Signatories, Commerce will establish the 
final Reference Price(s).
    C. Interested Parties shall file all communications and other 
submissions made pursuant to section VII or other sections of the 
Agreement via Commerce's Antidumping and Countervailing Duty 
Centralized Electronic Service System (ACCESS), which is available 
to registered users at https://access.trade.gov and to all parties 
at the following address:
U.S. Department of Commerce, Central Records Unit, Room B8024, 1401 
Constitution Ave. NW, Washington, DC 20230

    Such communications and submissions shall be filed consistent 
with the requirements provided in 19 CFR 351.303.
    D. Commerce may make available to representatives of each 
Interested Party, pursuant to and consistent with 19 CFR 351.304-
351.306, any business proprietary information submitted to and/or 
collected by Commerce pursuant to section VII of this Agreement, as 
well as the results of Commerce's analysis of that information.

XI. Duration of the Agreement

    A. This Agreement has no scheduled termination date. Termination 
of the suspended investigation will be considered in accordance with 
the five-year review provisions of section 751(c) of the Act and 19 
CFR 351.218.
    B. An individual Signatory, or Signatories, collectively, or 
Commerce may withdraw from this Agreement upon 90 days' written 
notice to Commerce or the Signatories, respectively.

-----------------------------------------------------------------------
Jeffrey I. Kessler
Assistant Secretary for Enforcement and Compliance
U.S. Department of Commerce
-----------------------------------------------------------------------
Date

    The following parties hereby certify that the members of their 
organization agree to abide by all terms of the Agreement:

-----------------------------------------------------------------------
Lic. Gustavo Rojo Plascencia
President
Confederaci[oacute]n de Asociaciones Agr[iacute]colas del Estado de 
Sinaloa, A.C.
-----------------------------------------------------------------------
Date

-----------------------------------------------------------------------
Ing Rosario Antonio Beltran Ureta
President
Sistema Producto Tomate
-----------------------------------------------------------------------
Date

-----------------------------------------------------------------------
Oscar Woltman De Vries
President
Asociaci[oacute]n Mexicana de Horticultura Protegida, A.C.
-----------------------------------------------------------------------
Date

-----------------------------------------------------------------------
Antonio Roberto Gandara Gonzalez
President
Asociaci[oacute]n de Productores de Hortalizas del Yaqui y Mayo
-----------------------------------------------------------------------
Date

-----------------------------------------------------------------------
Salvador Garcia Valdez
President
Consejo Agr[iacute]cola de Baja California, A.C.
-----------------------------------------------------------------------
Date

-----------------------------------------------------------------------
Andrew Jaxa-Debicki
Arent Fox, LLP--Counsel
For NS Brands, Ltd.
-----------------------------------------------------------------------
Date

Appendix A--Agreement Suspending the Antidumping Duty Investigation on 
Fresh Tomatoes From Mexico--Reference Prices

    Consistent with the requirements of section 734(c) of the Act, 
to eliminate completely the injurious effect of exports to the 
United States and to prevent the suppression or undercutting of 
price levels of domestic fresh tomatoes, the Reference Prices are as 
follows:

             Reference Price in U.S. Dollars per Pound (lb.)
  [FOB U.S. shipping point, i.e., U.S. side of the U.S.-Mexico border]
                                  \45\
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Fresh Tomatoes Other Than Organic   Round and Roma......            0.31
 Tomatoes.
                                    Stem On.............            0.46
                                    Tomatoes on the Vine            0.50
                                    Specialty--Loose....            0.49
                                    Specialty--Packed...            0.59
Organic Tomatoes..................  Round and Roma......           0.434
                                    Stem On.............           0.644
                                    Tomatoes on the Vine            0.70
                                    Specialty--Loose....           0.686
                                    Specialty--Packed...           0.826
------------------------------------------------------------------------

    The Reference Price for each type of box shall be determined 
based on the average weights stated in the chart contained in 
Appendix C of the Agreement. The delivered sales price to a Buyer 
for all Fresh Tomatoes from Mexico exported directly, or indirectly 
through a third country, to the United States shall include all 
movement and handling expenses beyond the point of entry into the 
United States (e.g., McAllen, Nogales, or Otay Mesa) and in excess 
of the Reference Price, i.e., the FOB U.S. shipping point price.
---------------------------------------------------------------------------

    \45\ The Reference Prices will remain in effect until changed. 
In accordance with section VII.G of the Agreement, the Reference 
Prices may be revised. No revision will be considered before one 
year from the Effective Date.
---------------------------------------------------------------------------

Appendix B--Agreement Suspending the Antidumping Duty Investigation on 
Fresh Tomatoes From Mexico--Analysis of Prices at Less Than Fair Value

A. Normal Value

    The cost or price information reported to Commerce that will 
form the basis of the normal value (NV) calculations for purposes of 
the Agreement must be comprehensive in

[[Page 49995]]

nature and based on a reliable accounting system (e.g., a system 
based on well-established standards and can be tied either to the 
audited financial statements or to the tax return filed with the 
Mexican government).

1. Based on Sales Prices in the Comparison Market

    When Commerce bases normal value on sales prices, such prices 
will be the prices at which the foreign like product is first sold 
for consumption in the comparison market in the usual commercial 
quantities and in the ordinary course of trade. Also, to the extent 
practicable, the comparison shall be made at the same level of trade 
as the export price (EP) or constructed export price (CEP).

Calculation of NV:
Gross Unit Price
+/- Billing Adjustments
    - Movement Expenses
    - Discounts and Rebates
    - Direct Selling Expenses
    - Commissions
    - Home Market Packing Expenses
= Normal Value (NV)

2. Constructed Value

    When normal value is based on constructed value, Commerce will 
compute constructed values (CVs) for each growing season, as 
appropriate, based on the sum of each respondent's growing and 
harvesting costs for each type of tomato, plus amounts for selling, 
general and administrative expenses (SG&A), U.S. packing costs, and 
profit. Commerce will collect this cost data for an entire growing 
season in order to determine the accurate per-unit CV of that 
growing season.

Calculation of CV:
    + Direct Materials
    + Direct Labor
    + Factory overhead
= Cost of Manufacturing
    + Home Market SG&A*
= Cost of Production
    + U.S. Packing
    + Profit*
= Constructed Value (CV)
* SG&A and profit are based on home-market sales of the foreign like 
product made in the ordinary course of trade. SG&A includes 
financing but not movement expenses.

B. Export Price and Constructed Export Price

    EP and CEP refer to the two types of calculated prices for 
merchandise imported into the United States. Both EP and CEP are 
based on the price at which the subject merchandise is first sold to 
a person not affiliated with the foreign producer or exporter.

Calculation of EP:
Gross Unit Price
    - Movement Expenses
    - Discounts and Rebates
    +/-Billing Adjustments
    +Packing Expenses
    +Rebated Import Duties
= Export Price (EP)

Calculation of CEP:
Gross Unit Price
    - Movement Expenses
    - Discounts and Rebates
    +/- Billing Adjustments
    - Direct Selling Expenses
    - Indirect Selling Expenses that relate to commercial activity 
in the United States
    - The cost of any further manufacture or assembly incurred in 
the United States
    - CEP Profit
    + Rebated Import Duties
    - Commissions
= Constructed Export Price (CEP)

C. Fair Comparisons

    To ensure that a fair comparison with EP or CEP is made, 
Commerce will make adjustments to normal value. Commerce will adjust 
for physical differences between the merchandise sold in the United 
States and the merchandise sold in the home market. For EP sales, 
Commerce will add in U.S. direct selling expenses, U.S. commissions 
\46\ and packing expenses. For CEP sales, Commerce will subtract the 
amount of the CEP offset, if warranted, and add in U.S. packing 
expenses.
---------------------------------------------------------------------------

    \46\ If there are not commissions in both markets, then Commerce 
will apply a commission offset.
---------------------------------------------------------------------------

Appendix C--Agreement Suspending the Antidumping Duty Investigation on 
Fresh Tomatoes From Mexico--Box Weights

    Commerce has the sole authority to make revisions to the Box 
Weight Charts used to apply the applicable reference price to 
particular box configurations. The Reference Prices for each pack 
style or box configuration shall be determined based on the average 
net weights stated in the Box Weight Charts below.
    Commerce shall commence and complete a box weighing exercise 
within 12 months following the signature of this Agreement, and 
thereafter, at such times as considered appropriate by Commerce. 
From the Effective Date, until such time as the box weight exercise 
is completed, the box weights from the previous 2013 suspension 
agreement will be incorporated into this current agreement, with 
necessary additions or modifications.
    All weighing exercises may occur at a U.S. Customs and Border 
Protection (CBP) port facility, at U.S. Selling Agent facilities, in 
bonded compounds, or at Signatory packhouses, at the sole discretion 
of Commerce. For weighing exercises conducted at a CBP port 
facility, Commerce will coordinate with CBP in its collection and 
review of data for calculating and monitoring box-specific average 
weights, as appropriate.
    Commerce will provide 14 hours advance notice to the Signatories 
(through the Grower Associations' counsel or directly to the 
Signatories, in the event that they are not represented by counsel) 
of the commencement of any box weighing exercise. Subject to 
approval by Commerce and CBP, as appropriate, Commerce will 
undertake best efforts to ensure that at least two, but no more than 
four representatives of the Signatories are permitted access to a 
port or other facility to observe the box weighing exercise. 
Observers will be chosen by the Grower Associations. Any requests 
for additional observers from Signatories not represented by the 
Grower Associations' counsel will be considered by Commerce. In the 
event that no otherwise qualified observers are permitted by CBP to 
enter a port facility, Commerce will either delay the exercise until 
at least one qualified observer is present or, at its discretion, 
will conduct the box weighing exercise at an alternate location.\47\
---------------------------------------------------------------------------

    \47\ Assuming proper notice is provided and necessary government 
approval is granted, it is the Signatories' responsibility to ensure 
that their representatives observe the box weighing exercise, or the 
right to observe is waived.
---------------------------------------------------------------------------

    To derive representative average net weights \48\ for each box 
type in the charts below, and any configurations that may be added, 
Commerce will weigh twenty sample boxes from ten shippers for high-
volume pack types,\49\ a minimum of two shippers for low-volume pack 
types, and five shippers for all other pack types. All shippers will 
be randomly chosen, without notice to the specific shippers.
---------------------------------------------------------------------------

    \48\ Average net weights are calculated by deducting the tare 
weight from the average gross box weight. For each twenty-box 
sample, the tare weight will be calculated by weighing a minimum of 
two empty boxes. If the differences in the weights of the boxes 
exceed two-hundredths of a pound, additional boxes will be weighed 
to establish the tare. Irrespective of any deviation, the average 
weight of five boxes will be sufficient to establish the tare.
    \49\ The 25-pound box configuration is an example of a high-
volume pack type.
---------------------------------------------------------------------------

    Observers may raise bona fide challenges to the recording of the 
weight of a particular box at the time it is weighed and must 
specify the nature of the challenge.\50\ The parties will endeavor 
to resolve any such challenges immediately at the time of the 
weighing. A box weight will not be recorded if a bona fide challenge 
is not resolved. No challenges to the weight of a box will be 
considered once its weight has been recorded.
---------------------------------------------------------------------------

    \50\ Examples of bona fide challenges may include the non-random 
selection of trucks, loads or boxes, or selection of wet, damaged, 
or compromised boxes or pallets.
---------------------------------------------------------------------------

    If Commerce determines to revise an average weight figure based 
upon information that an average weight on the chart is no longer 
accurate or to provide an average weight for a box configuration not 
currently on the chart, Commerce will provide at least fifteen days' 
notice to Signatories (through the Grower Associations' counsel or 
directly to the Signatories, in the event that they are not 
represented by counsel) prior to the effective date of such revised 
average weights for purposes of this Agreement. Commerce will 
determine the revised average weight in accordance with the 
procedure described above.
    In the event that a Signatory intends to export subject 
merchandise to the United States in a box for which there is no 
average weight on the chart, the Signatory shall notify Commerce in 
writing no later than five business days prior to the date of the 
first exportation of such boxes to the United States. Signatories 
can obtain a copy of the suggested form for submitting this

[[Page 49996]]

information from Commerce's website at: https://enforcement.trade.gov/tomato. This information must be submitted to 
Commerce in accordance with the filing instructions set forth in 
Commerce's regulations. Commerce shall allow any Interested Party to 
submit written comments, not to exceed ten pages, on the appropriate 
average weight for the box within seven days after the filing of the 
written notification by the Signatory, and Commerce shall inform the 
Signatory or its representative of the average weight for the box no 
later than thirty days after filing of the written notification by 
the Signatory. A Signatory's failure to notify Commerce of intended 
shipments of tomatoes in boxes for which there is no average weight 
on the box weight chart may constitute a Violation of the Agreement 
in accordance with section VIII.E.9.

Box-Weight Chart--Round and Roma Suspension of Antidumping 
Investigation on Fresh Tomatoes From Mexico

TBD

Box-Weight Chart--Stem on Suspension of Antidumping Investigation on 
Fresh Tomatoes From Mexico

TBD

Box-Weight Chart--Tomatoes on the Vine Suspension of Antidumping 
Investigation on Fresh Tomatoes From Mexico

TBD

Box-Weight Chart--Specialty--Loose Suspension of Antidumping 
Investigation on Fresh Tomatoes From Mexico

TBD

Box-Weight Chart--Specialty--Packed Suspension of Antidumping 
Investigation on Fresh Tomatoes From Mexico

TBD

Appendix D--Agreement Suspending The Antidumping Duty Investigation On 
Fresh Tomatoes From Mexico--Procedures for Making Adjustments to the 
Sales Price Due to Certain Changes in Condition After Shipment

    The purpose of this appendix is to explain the procedures for 
making adjustments to the sales price of Signatory tomatoes due to 
certain changes in condition after shipment following USDA 
inspections at destination points (e.g., receiver facilities). Where 
a partial lot is being rejected, the net sales price of all accepted 
tomatoes in the lot shall result in a unit price that is not less 
than 100 percent of the applicable Reference Price established in 
Appendix A minus the per-unit USDA inspection fees and per-unit 
freight expenses attributable to the defective tomatoes. In such 
cases, the following formula shall be satisfied: \51\
[GRAPHIC] [TIFF OMITTED] TN24SE19.004

    Appendix G of the Agreement outlines specific actions that 
Signatories should take to ensure that their efforts to abide by the 
Agreement are upheld in any claims taken to USDA under PACA.
    To facilitate the verification of claims for changes in 
condition after shipment, the contracts between the Signatory and 
the Buyer (if no Selling Agent(s) is included in the distribution 
chain) or between the Signatory, Selling Agent(s), and the Buyer 
must establish that all documentation be completed within 15 
business days after the USDA inspection, and that claims be resolved 
within 15 business days after the USDA inspection, unless the claim 
is referred to PACA for mediation. Failure to complete this 
documentation in a timely manner may constitute a Violation of the 
Agreement in accordance with section VIII.E.10. When filing 
quarterly certifications with Commerce in accordance with section 
VII.D.4, Signatories must report the number of lots on which claims 
for quality and condition defects were granted, the total volume of 
tomatoes destroyed, the total value of claims granted, and the total 
value of payments made to the Buyer by the Signatory and/or Selling 
Agent.
    Upon request from Commerce at any time, whether for sales made 
directly, or indirectly through a Selling Agent, to the Buyer, 
Signatories must provide a worksheet detailing all adjustments, 
expenses, and payments to the Buyer by the Signatory or Selling 
Agent related to such reported claims for quality and condition 
defects in a given quarter, with a reconciliation to the invoice 
price and supporting documentation to include the CBP entry packet 
(if available), USDA inspection certificates, Commerce's Accounting 
Sales and Cost form, bills of lading, invoices, credit memos, 
freight invoices, reconditioning/repacking invoices, inspection 
fees, as well as destruction receipts, donation certificates, and 
or/proof of return.

A. USDA Inspection and Adjustments

    1. No adjustments will be made for failure to meet suitable 
shipping conditions unless supported by an unrestricted USDA 
inspection. A USDA inspection certificate reflecting the 
unrestricted USDA inspection must be provided to support claims for 
rejection of full or partial lots. The USDA inspection certificate 
should identify all quality and condition defects identified in 
paragraph 5 that are found in the inspection.
    2. If the USDA inspection indicates that the lot has: (1) Over 
8% soft/decay condition defects; (2) over 15% of any one quality or 
condition defect; or (3) greater than 20% total quality and/or 
condition defects, the receiver may reject the lot or may accept a 
portion of the lot and reject the quantity of tomatoes lost during 
the salvaging process. In those instances, price adjustments will be 
calculated as described below. For purposes of this Agreement, a 
quality or condition defect is any defect listed in the charts in 
part A.5 below. When a lot of tomatoes has quality and condition 
defects in excess of those outlined above as documented on a USDA 
inspection certificate, the documented percentage of the tomatoes 
with quality and condition defects are considered DEFECTIVE 
tomatoes.
    3. No adjustments will be made for failure to meet suitable 
shipping conditions if the USDA inspection certificate does not 
indicate one of the quality or condition thresholds outlined above.
    4. The USDA inspection must be requested no more than eight 
hours from the time of arrival at the destination specified by the 
receiver and be performed in a timely fashion thereafter. If there 
is more than one USDA inspection on a given lot, the inspection 
certificate corresponding to the first inspection is the one that 
will be used for making any adjustment to the sales price. However, 
if an appeal inspection is conducted which reverses the original 
inspection, it will supersede the first inspection, as long as the 
appeal inspection

[[Page 49997]]

is requested within a reasonable amount of time not to exceed 12 
hours from the first inspection.
    The first receiver of the product, regardless of whether that 
receiver is acting on behalf of a Buyer or whether the receiver is 
the Buyer acting on its own right, must specify the city/
metropolitan area of the destination of the product. The inspection 
will take place at the destination of delivery as specified prior to 
shipment.
    No adjustments will be granted for a USDA inspection at a 
destination which is different from the destination specified by the 
first receiver of the product. In the event that the first receiver 
does not specify the city/metropolitan area of the destination of 
the product, the eight-hour period within which an inspection may be 
requested will begin to run at such time as title to the product 
transfers to the unrelated purchaser, for example, upon loading of 
the product at the first handler's (importer's) warehouse in an FOB 
transaction and upon delivery of the product to the Buyer's 
warehouse in a delivered sale.
    A person or company shall be considered a broker for a Buyer: 
(1) When that person or company falls within the description of 
types of broker operations set forth in 7 CFR 46.27; or (2) has 
provided a broker's memorandum of sale as set forth in 7 CFR 
46.28(a). The following paragraphs apply if a broker or dealer is 
involved in the transaction.
    A broker, unlike a dealer, does not take ownership or control of 
the tomatoes but arranges for delivery directly to the vendor or 
purchaser. Because a broker never takes ownership or control over, 
or title to, the tomatoes, the Buyer and not the broker may request 
an inspection, and only the Buyer is entitled to any resulting 
adjustments. The inspection would take place at the Buyer's 
destination, as specified in the broker's contract with the Selling 
Agent.
    When a dealer is involved in the sale, the destination of 
delivery stated in the contract is where the inspection is to take 
place. If the dealer does not specify the destination of delivery, 
the default destination of delivery is the warehouse of the Selling 
Agent. With respect to a lot of tomatoes that is owned or controlled 
by a dealer, it is the responsibility of the dealer to request an 
inspection of the tomatoes in his possession in a timely manner, if 
he deems it necessary. If the dealer does not request an inspection 
in a timely manner (i.e., within eight hours from the time of 
arrival at the destination specified by the dealer) and resells the 
tomatoes to a third party, which does request an inspection, the 
dealer is then responsible for all costs and adjustments pertaining 
to the inspection and the condition or quality of the tomatoes.
    5. Under this Agreement, adjustments to the sales price of 
Signatory tomatoes will be permitted for all condition defects as 
well as the quality defect noted below. The term ``condition 
defect'' is intended to have the same definition recognized by 
USDA's Specialty Crops Inspection Division and, therefore, covers 
the following items:

------------------------------------------------------------------------
                            Condition defects
-------------------------------------------------------------------------
(1) Abnormal Coloring
(2) Abnormally Soft and Watery Fruit
(3) Blossom End Discoloration
(4) Bruises
(5) Chilling Injury
(6) Cuts and Broken Skins (unhealed)
(7) Discolored Seed Areas
(8) Freezing and Freezing Injury
(9) Insect/Worm Injury (alive when present)
(10) Internal Discoloration
(11) Moldy and/or Decayed Stems
(12) Nailhead Spot
(13) Shriveling
(14) Skin Checks
(15) Soft/Decay
(16) Soil Spot
(17) Surface Discoloration (Silvery-White and Gold Fleck)
(18) Sunburn
(19) Sunken Discolored Areas
(20) Waxy Blister
(21) White Core
------------------------------------------------------------------------

    The term ``quality defects'' is intended to have the same 
definition recognized by USDA's Specialty Crops Inspection Division 
and covers the following subset of such items:

------------------------------------------------------------------------
                             Quality defects
-------------------------------------------------------------------------
(1) Puffiness
------------------------------------------------------------------------

    6. In calculating the transaction price for lots subject to an 
adjustment claim for quality and condition defects, as defined 
above, the tomatoes classified as DEFECTIVE will be treated as 
rejected and as not having been sold.

B. Contractual Terms for Rejection of Partial Lots

    If the lot contains quality and condition defects greater than 
those outlined above and the receiver does not reject the entire lot 
of tomatoes, Commerce will factor certain adjustments into the 
transaction price. Specifically, the Signatory or Selling agent, as 
applicable, may reimburse the Buyer for the inspection fees listed 
on the USDA inspection certificate and the freight expenses 
attributable to the defective tomatoes.
    1. The per-unit price invoiced to and paid by the Buyer for the 
accepted tomatoes must not fall below the Reference Price minus the 
per-unit USDA inspection fees and per-unit freight expenses 
attributable to the defective tomatoes, in accordance with the 
above-specified formula.
    2. The Signatory or Selling Agent, as applicable, may reimburse 
the Buyer for the portion of freight expenses allocated to the 
DEFECTIVE tomatoes.
    3. The Signatory or Selling Agent, as applicable, may reimburse 
the Buyer for the inspection fees attributable to the DEFECTIVE 
tomatoes and listed on the USDA inspection certificate.
    4. Any reimbursements from, by, or on behalf of the Signatory or 
Selling Agent, as applicable, that are not specifically mentioned in 
item B.2 and B.3 above, or that are not properly documented, will be 
not be allowed to be factored into the calculation of the price for 
the accepted tomatoes.
    5. The Buyer may not keep or resell the DEFECTIVE tomatoes 
either directly or through third parties.\2\ Such tomatoes must be 
destroyed under USDA oversight, with a USDA certificate provided to 
the Buyer, Signatory, or Selling Agent as proof of destruction. 
Proof of such destruction must be maintained by the Buyer, 
Signatory, or Selling Agent and is subject to submission to, and 
verification by, Commerce.
---------------------------------------------------------------------------

    \2\ Tomatoes for processing must be handled in accordance with 
the guidelines set forth in Appendix F of the Agreement.
---------------------------------------------------------------------------

    6. In addition, for each transaction involving adjustments due 
to changes in condition after shipment the Signatory or Selling 
Agent, as applicable, must obtain/maintain the following documents/
information:

--Shipper name;
--Shipping manifest;
--Details of the shipper invoice, including invoice number, date, 
brand, tomato type, quantity (boxes), and value;
--Documentation supporting the freight expenses incurred for the 
original shipment;
--USDA inspection certificate;
--Detailed listing of the expenses incurred in salvaging the non-
DEFECTIVE tomatoes and documentation supporting the expenses;
--Description of the destruction process and documentation from the 
landfill;
--USDA destruction certificate;
--Proof-of-payment documentation for any destruction costs;
--A statement that ``No monies or other compensation were received 
for the destroyed tomatoes;''
--Signature of a responsible official at the receiver.

C. Contractual Terms for Rejection of Full Lots

    In cases where the Buyer has rejected the full lot of tomatoes 
based on quality and condition defects, the Signatory or Selling 
Agent, as applicable, may choose to have the entire lot destroyed or 
returned. If the entire lot is destroyed, the Signatory or Selling 
Agent, as applicable, will require the receiver to provide the 
documentation noted above under B.5 for partial-lot rejections. 
Further, the Signatory or Selling Agent, as applicable, may 
reimburse the Buyer for ordinary and customary freight and USDA 
inspection expenses that the Buyer incurred with respect to the lot 
as long as the Signatory or Selling Agent, as applicable, obtains 
the support documentation specified above under B.5. Commerce will 
treat such transactions as ``non-sales'' provided that adequate 
support documentation is available.
    Alternatively, the Signatory or Selling Agent, as applicable, 
may sell the entire rejected lot to another Buyer (the ``Final 
Buyer''). In that case, the price paid must be not less than the 
Reference Price plus all costs incurred (e.g., transportation, 
commissions, etc.) from the FOB U.S. shipping point, i.e., U.S. side 
of the U.S.-Mexico border to the Final Buyer. If the Final

[[Page 49998]]

Buyer finds that the lot contains quality and condition defects 
greater than those outlined above, it shall follow the directions 
stated above with respect to rejection of partial lots.
    The Buyer may reject the full lot of tomatoes if the lot 
contains more than 35 percent quality and condition defects, as 
listed in the charts in part A.5, based on a USDA inspection 
certificate. Additionally, the Signatory (both in cases of direct 
sales as well as in cases of indirect sales through a Selling 
Agent(s)) must pay all expenses related to the return of the entire 
lot to Mexico. Such rejected lots may not be sold, donated, or 
destroyed in the United States. Commerce may request at any time, 
and Signatories agree to provide, any and all documentation related 
to such rejections.

D. Contractual Terms for Partial vs. Unrestricted Lot Inspections

    As explained in part A.1 above, Commerce will only allow 
adjustments to the transaction price for quality and condition 
defects if the USDA inspection is unrestricted. During the time 
between the call for inspection and the arrival of the USDA 
inspector, the Buyer might sell part of the lot and, therefore, by 
the time the USDA inspector arrives, that part is not available for 
inspection. If the USDA inspector is allowed full access to the 
partial lot, Commerce will consider this an unrestricted partial-lot 
inspection. Alternatively, if the USDA inspector is not allowed full 
access to the partial lot, Commerce will deem it a restricted 
inspection. No adjustments will be made for failure to meet suitable 
shipping conditions or for quality defects if the USDA inspection is 
restricted. For purposes of this Agreement, when calculating an 
adjustment for failure to meet suitable shipping conditions where an 
unrestricted partial-lot inspection has taken place, only the 
portion of the lot inspected is eligible for adjustment. The portion 
of the lot that the Buyer sold prior to the inspection will not be 
eligible for an adjustment based on the USDA inspection.
    For example, before the USDA inspector arrives, the Buyer sells 
140 boxes of 5x5s from a lot identified as 160 5x5s on the invoice. 
When the USDA inspector arrives, the Buyer requesting the inspection 
provides full access to the partial lot within its possession. The 
inspector finds that the partial lot of 20 5x5s has soft/decay 
condition defects of 25 percent and notes this on this inspection 
certificate. Under the Agreement, only the 20 5x5s are eligible for 
an adjustment for failure to meet suitable shipping conditions, and 
the 140 5x5s that the Buyer already sold will not be eligible for an 
adjustment based on the USDA inspection.

Appendix E--Agreement Suspending the Antidumping Duty Investigation on 
Fresh Tomatoes From Mexico--Contractual Arrangement for Documenting 
Sales of Signatory Merchandise to Canada

    Where a Signatory or Selling Agent enters Fresh Tomatoes into 
the United States for consumption and then re-exports the subject 
merchandise to Canada, this appendix applies. The purpose of this 
appendix is to: (1) Outline the process that each Signatory to this 
Agreement must follow to ensure that the Signatory or Selling Agent 
properly documents sales to Canada as such and (2) ensure that the 
Signatory notifies the Canadian customer that any resales of its 
merchandise from Canada into the United States must be in accordance 
with the terms of this Agreement.
    To document sales of Mexican tomatoes to Canada properly, this 
Agreement requires that such transactions be made pursuant to a 
contractual arrangement where each Signatory maintains, or requires 
that the Selling Agent that facilitates the sale to Canada 
maintains, the following information in its files:
    1. Signatory name and Signatory number;
    2. Shipping manifest;
    3. An invoice identifying sale date, brand, tomato type, 
quantity (boxes), and value; and
    4. Entry documentation from Canadian Customs (i.e., Landing Form 
(Form B3) or the Canada Customs Coding Form).
    If a Signatory to the Agreement or its Selling Agent does not 
document a sale to Canada in accordance with the procedures outlined 
above, Commerce will consider the transaction a U.S. sale. Failure 
to properly document a sale to Canada may constitute a Violation of 
the Agreement in accordance with section VIII.E.11.
    Signatories must ensure that the Canadian customer is notified 
that any resale of the Signatory merchandise from Canada into the 
United States must be in accordance with the terms of the Agreement, 
including the box labeling requirements in section VII.D.3.b, and 
that any movement or handling expenses beyond the point of entry 
into the United States must be added to the Reference Price, i.e., 
the FOB U.S. shipping point price, and must reflect the actual cost 
for an arm's-length transaction. Signatories can obtain from 
Commerce's website a copy of the suggested form for providing such 
notification. See ``Form for Notifying Canadian Customer That 
Resales of Signatory Merchandise Into the United States Are Covered 
by the Terms of the 2019 Suspension Agreement'' at https://enforcement.trade.gov/tomato. Further, through contractual 
arrangement each Signatory must maintain, or require that the 
Selling Agent maintains, evidence in its files to document that the 
Canadian customer was notified that any resales of the Signatory 
merchandise from Canada into the United States must be in accordance 
with the terms of the Agreement.

Appendix F--Agreement Suspending the Antidumping Duty Investigation on 
Fresh Tomatoes From Mexico--Procedure Signatories Must Follow for 
Selling Subject Merchandise for Processing

    Sales to the United States of Signatory tomatoes for processing 
must be:
    1. Sold directly to a processor (in other words, the first 
purchaser in the United States of tomatoes for processing must be an 
actual processor);
    2. Accompanied by an ``Importer's Exempt Commodity Form''--Form 
FV-6, within the meaning of 7 CFR 980.501(a)(2) and 980.212(i), 
should be used for all tomatoes for processing that are covered by 
the Federal Marketing Order 966 (Marketing Order); tomatoes for 
processing that are not covered by the Marketing Order (e.g., romas, 
grape tomatoes, greenhouse tomatoes, and any tomatoes that are 
entered during the part of the year that the Marketing Order is not 
in effect) must be accompanied by the ``2019 Suspension Agreement--
Tomatoes for Processing Exemption Form''. The exempt commodity form 
must be maintained by the importer and presented to CBP upon request 
and both the Signatory or Selling Agent, as applicable, and the 
processor must maintain a copy of the form.
    3. Shipped in a packing form that is not typical of tomatoes for 
the fresh market (e.g., bulk containers in excess of 50 lbs.)--
examples of typical fresh-market packing forms are identified in the 
Box-Weight Chart in Appendix C of the Agreement; and
    4. Clearly labeled on the packaging as ``Tomatoes for 
Processing.''
    Signatories can obtain from Commerce's website an example of the 
``2019 Suspension Agreement--Tomatoes for Processing Exemption 
Form.'' See https://enforcement.trade.gov/tomato. If a party in the 
United States facilitates the transaction, through contractual 
arrangement each Signatory must require that the party follow the 
procedures outlined above. Failure to properly document sales to 
processors may constitute a Violation of the Agreement in accordance 
with section VIII.E.12.
    Sales of Signatory merchandise to a processor after importation 
into the United States are a Violation of the Agreement in 
accordance with section VIII.E.12.

Appendix G--Agreement Suspending the Antidumping Duty Investigation on 
Fresh Tomatoes From Mexico--Specific Actions That Signatories Should 
Take To Ensure That Their Efforts To Abide by the Agreement Are Upheld 
in Any Claims Taken to the U.S. Department of Agriculture Under The 
Perishable Agricultural Commodities Act

    This appendix provides guidance on the specific actions 
Signatories can take to ensure that their efforts to abide by the 
Agreement are upheld in any claims taken to USDA under PACA.
    Payment disputes arising under the Agreement are actionable and/
or able to be resolved under the PACA dispute resolution procedure. 
The PACA Division will uphold actions taken by a Signatory or a 
Signatory's representative (collectively, Signatory) to comply with 
the Agreement to the extent that the sales contract for the 
transaction at issue establishes that the sale is subject to the 
terms of the Agreement.
    In other words, if, prior to making the sale, the Signatory, or 
the Selling Agent acting on behalf of the Signatory through a 
contractual arrangement, informs the customer (i.e., the Buyer) that 
the sale is subject to the terms of the Agreement and identifies 
those terms, the PACA Division will recognize the identified terms 
of the Agreement as integral to the sales contract. In particular, 
Signatories

[[Page 49999]]

should inform their customers that their contractual agreement to 
allow defect claim adjustments is limited in accordance with the 
Agreement, including:
    * Claims for adjustments must be supported by an unrestricted 
USDA inspection called for no more than eight hours from the time of 
arrival at the receiver and performed in a timely fashion 
thereafter.
    * The USDA inspection must find that the quality and/or 
condition defects exceed the thresholds outlined in Appendix D 
above.
    * Any price adjustments will be limited to the actual percentage 
of quality and/or condition defects as documented by a USDA 
inspection certificate.
    * The price adjustments will be limited to USDA inspection fees 
and the allocated freight expense attributable to the defective 
tomatoes calculated in accordance with Appendix D above.
    * The customer may not resell any DEFECTIVE tomatoes. Instead, 
they must be destroyed or returned. Signatories should provide a 
copy of the Agreement to any customer which may be unfamiliar with 
its terms or which has questions about those terms.
    The process by which a Signatory could provide evidence to the 
PACA Division that its sales contracts were made subject to the 
terms of the Agreement including, in particular, those terms listed 
above is outlined below.
    * The Signatory should maintain written documentation 
demonstrating that it had informed its customers, and the customers 
accepted, that the sales were subject to the terms of the Agreement 
prior to issuing the invoice. A signed contract to that effect would 
be the best evidence of that fact; however, a purchase by the 
customer after being informed of the relevance of the Agreement is 
evidence of acceptance.
    * The Signatory should send letters to its customers via 
registered mail, return receipt requested, overnight mail, or email 
with a confirmation received from the recipient, informing the 
customers that, as a Signatory to the Agreement, all of the 
Signatory's sales are subject to the terms of the Agreement and 
that, by purchasing from them, the Buyer agrees to those terms. The 
letter should also indicate that the Signatory's sales personnel do 
not have authority to alter the terms of the Agreement.
    * In addition, the Signatory should include a statement on its 
order confirmation sheets that its contract with the buyer is 
subject to the terms of the Agreement as detailed in the Signatory's 
``pre-season'' letter and maintain a copy of the order confirmations 
and fax receipts demonstrating that they were sent to the customer 
prior to making the sale. If the sale is to a first-time purchaser 
that did not receive a ``pre-season'' letter, a letter should be 
supplied to the buyer prior to making a sale.
    PACA does not require any one particular form of written 
documentation but USDA officials have confirmed that, if Signatories 
maintain written evidence demonstrating that their customers were 
informed that their sales were made subject to the terms of the 
Agreement prior to sale, PACA will recognize those terms as part of 
the sales contract.

Appendix H--Agreement Suspending The Antidumping Duty Investigation on 
Fresh Tomatoes From Mexico--Procedures for Reporting Alleged Violations 
or Circumvention of the Agreement

    Appendix H enables persons with knowledge of suspected 
Violations \52\ of the Agreement to inform Commerce by emailing the 
below form to Commerce officials. The form and any factual 
information provided will be placed on the record of the proceeding 
by Commerce officials. The person submitting the form and factual 
information to Commerce is, pursuant to 19 CFR 351.303(g), required 
to include a certification of factual information, and should use 
the applicable certification formats provided therein. All 
submissions, if business proprietary treatment for certain 
information is claimed under Commerce's regulations, must be 
accompanied by a public version, in accordance with the requirements 
of 19 CFR 351.304.
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    \52\ See sections II.V and VIII.E of the Agreement.

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                      NAME OF PERSON MAKING REPORT:
                          COMPANY AFFILIATION:
                              PHONE NUMBER:
                             E-MAIL ADDRESS:
 
 
                           ALLEGED VIOLATION:
(Please attach any documents to this report and add blank pages if
 needed)
 
 
 
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[FR Doc. 2019-20813 Filed 9-23-19; 8:45 am]
BILLING CODE 3510-DS-P