(65 FR 13943, March 15, 2000)
                                                  A-201-802
                                                  ARP 97-98
                                                  Public Document
                                                  G1O3: SMH

MEMORANDUM TO: Robert S. LaRussa
               Assistant Secretary
                 for Import Administration

FROM:          Richard W. Moreland
               Deputy Assistant Secretary
               For Import Administration


SUBJECT:       Issues and Decision Memo for the Administrative Review
               of Gray Portland Cement and Clinker From Mexico --
               August 31, 1997 through July 31, 1998

Summary

We have analyzed the comments and rebuttals of interested parties
in the 97/98 administrative review of the antidumping duty order
covering gray portland cement and clinker from Mexico.  As a result
of our analysis, we have made changes, including corrections of
certain inadvertent programming and clerical errors, in the margin
calculations.  We recommend that you approve the positions we have
developed in the Discussion of the Issues section of this memorandum.
Below is the complete list of the issues in this administrative
review for which we received comments and rebuttals by parties:

1.  Revocation

2.  As Invoiced vs. As Produced

3.  Ordinary Course of Trade

4.  Level of Trade

5.  Constructed Export Price Calculation

6.  Regional Assessment

7.  Bag vs. Bulk

8.  Difference-in-Merchandise Calculation

9.  Sales-Below-Cost Test

10. Special Cement

11. Assessment-Rate Calculation

12. Adjustments
    a.  Rebates
    b.  Freight
    c.  Advertising
    d.  Early-Payment Discounts
    e.  Credit Expenses
    f.  Other Adjustments

13. Financing Cash Deposits

14. Duty Absorption

15. PROMEXMA Sales

16. Contrucentros Employee Sales

17. Further-Manufactured Sales

18. Ministerial Errors
    a.  Model Matching
    b.  CDCs Employee Sales
    c.  U.S. Direct Selling Expenses


Background

On September 8, 1999, the Department of Commerce (the Department)
published the preliminary results of administrative review of the
antidumping duty order on gray portland cement and clinker from
Mexico (Gray Portland Cement and Clinker From Mexico; Preliminary
Results of Antidumping Administrative Review and Extension of Final
Results of Administrative Review, 64 FR 48778 (preliminary results)).
The merchandise covered by this order is gray portland cement and
clinker.  The period of review (POR) is August 1, 1997, through July
31, 1998.

We invited parties to comment on our preliminary results of review.
Discussion of the Issues

1.Revocation

Comment 1:  CEMEX, S.A. de C.V. (CEMEX), and Cementos de
Chihuahua, S.A. de C.V. (CDC), argue that the Department must
terminate this review and revoke the underlying antidumping duty
order.  CEMEX contends that, at the time of the initiation of the
original Less- Than-Fair-Value (LTFV) investigation (October 16,
1989), the Department assumed that the petition was filed "on behalf
of" a regional industry without measuring whether a majority of the
industry actually supported the request.  The Department should have
done so, CEMEX argues, because a General Agreement on Tariffs and
Trade (GATT) panel decided in July 1992 that the 1980 antidumping
code required that an antidumping petition filed "on behalf of"' an
industry must be supported by an appropriate majority of the industry
and that such support must be ascertained prior to initiating an
investigation.  According to CEMEX, the panel's decision applies to
the instant administrative review for two reasons.  First, it
contends, the Antidumping Agreement resulting from the Uruguay Round
negotiations adopted the requirement of industry support articulated
by the GATT panel.  CEMEX asserts U.S. law incorporated the new
standing requirements contained in the Antidumping Agreement, citing
section 732(c)(4)(C) of the Tariff Act of 1930 (the Act).  Second,
CEMEX asserts, even if the pre-Uruguay Round Agreements Act (URAA)
antidumping law applies, the antidumping statute that was in effect
in 1989 did not define the term "on behalf of."  CEMEX argues that
the Department is compelled by the decision in Murray v. Schooner
Charming Betsy, 6 U.S. 64, 2 Cranch 64 (1804), to reinterpret U.S.
law in accordance with the international obligations of the United
States.  Based on the above arguments, CEMEX asserts that the
Department is therefore required in this review to revisit the issue
of initiation in the original LTFV investigation.

According to CDC, the plain language of section 771(4)(C) of the
Act requires petitions in regional-industry cases to be filed on
behalf of the producers that account for "all, or almost all, of the
production in the region."  Since the antidumping duty order covering
cement from Mexico was based on a petition that was unsupported by
producers accounting for all or almost all of the region's
production, CDC asserts, the Department issued the order in violation
of U.S. law.  CDC disputes the Departments assertion in the 96/97
review that, because the issue of petitioners standing was not
challenged in court, the issue cannot be revisited in the context of
an administrative review.  CDC argues that the lack of standing to
file an antidumping duty petition is a "jurisdictional" defect which
parties may raise at any time.  CDC contends that the Department has
the authority to revoke an order that never had the requisite level
of industry support, citing Zenith Electronics Corp. v. United
States, 872 F. Supp. 992 (CIT 1994) (Zenith Electronics), Gilmore
Steel Corp. v. United States, 585 F. Supp. 670 (CIT 1984) (Gilmore
Steel), and Oregon Steel Mills, Inc. v. United States, 862 F.2d 1541
(Fed. Cir. 1988) (Oregon Steel Mills).  CDC also contends that the
Department dismissed the standing issue raised in the 96/97 review
and supported its decision based on cases that pertained to national
rather than regional- industry cases.  CDC points out that the
definition of domestic industry in regional cases imposes a different
standard for the support that is required when making the "on behalf
of" determination.

The Southern Tier Cement Committee (the petitioner) comments that
CEMEX and CDC have raised the argument that the Department must
terminate the review and revoke the underlying antidumping duty order
on the ground that the Department initiated the antidumping
investigation improperly in 1989 in the reviews covering the 92/93
through 96/97 periods.  The petitioner argues that the North American
Free Trade Agreement (NAFTA) binational panels reviewing the final
results of the 92/93 and 94/95 reviews both ruled unanimously against
CEMEXs position on a variety of grounds.  The petitioner asserts
that CEMEXs and CDCs claim that the Department must revoke the
antidumping duty order and terminate this administrative review has
no legal foundation.

The petitioner argues that CEMEXs and CDCs claim is barred by the
statute of limitations which required any appeal of the decision to
initiate the antidumping investigation to be filed within 30 days of
the publication of the antidumping duty order.  The petitioner claims
that CEMEX and CDC did not exhaust available administrative remedies
when they did not raise the issue before the Department in the
original investigation.  Furthermore, the petitioner contends that
the respondents did not raise the issue in an appeal to the Court of
International Trade from the Departments final determination in the
original investigation.  The petitioner also cites the Departments
95/96 review final results (Gray Portland Cement and Clinker From
Mexico, 63 FR 12765 (March 16, 1998)) and 96/97 review final results
(Gray Portland Cement and Clinker From Mexico, 64 FR 13149 (March 17,
1999)) in which the Department commented  that panel reports under
the 1947 GATT were not self-executing and had no legal effect under
U.S. law and that neither the 1947 GATT nor the 1979 GATT antidumping
code obligated the United States to establish industry support in
regional-industry cases.

The petitioner contends that the Department lacks authority under
the statute to rescind its decision to initiate or to re-examine the
issue of industry support in a review.  Citing Suramerica de
Aleaciones Laminda, C.A. v. United States, 966 F.2d 660 (Fed. Cir.
1992) (Suramerica), and the 95/96 final results, the petitioner
asserts that courts have affirmed the Departments presumption of
industry support.

Department's Position:  There are no circumstances in this review
that would cause the Department to reevaluate industry support
underlying the petition.  Nor is there any basis, statutory or
otherwise, to revoke the order based on lack of industry support at
the time of initiation.  Furthermore, as we stated in our last final
results of review, we have no obligation at this time to determine
whether the petition was filed by or on behalf of the industry.
Moreover,  the URAA amended the statute by prohibiting the Department
from revising the issue of industry support once the Department has
initiated an LTFV investigation.  See section 732(c)(4)(E) of the Act.

Neither the 1947 GATT nor the 1979 GATT Antidumping Code obligated
the United States to establish affirmatively prior to the initiation
of a regional-industry case that all or almost all of the producers
in the region supported the petition.  Neither agreement suggested
that the standing requirements in regional-industry cases were any
more rigorous than the standing requirements in national-industry
cases.

Furthermore, GATT panel reports, such as the report issued in 1992,
had no legal effect or formal status unless and until they were
adopted by the GATT Council or, in the case of antidumping measures,
the GATT Antidumping Code Committee.  This followed from the fact
that the 1947 GATT operated, throughout its history, on the basis of
consensus for purposes of decision-making in general and the
resolution of disputes in particular.  It is undisputed in the
present case that the Antidumping Code Committee never adopted the
GATT panel report.  Thus, the recommendations contained in the report
were never binding, did not impose any international obligations upon
the United States, and did not trigger the rule of statutory
construction set forth in Murray v. Schooner Charming Betsy.

As we pointed out in previous determinations, the object of the
respondents comments is not the preliminary results of this review.
Rather, the respondents challenge the initiation of the original LTFV
investigation, an event which occurred almost ten years ago and over
five years before the effective date of the URAA.  The time to voice
such objections before the Department was during the investigation.
Instead, CEMEX and CDC, as well as the other Mexican cement producer
that participated in the original investigation (Apasco, S.A. de
C.V.), did not raise this argument before the Department.  See Final
Determination of Sales at Less Than Fair Value; Gray Portland Cement
and Clinker From Mexico, 55 FR 29244 (July 18, 1990) (Original LTFV
Investigation).  Moreover, neither CEMEX nor any other party appealed
the agency's final affirmative LTFV determination (including the
decision to initiate) to the appropriate court, and the deadline for
doing so has long expired.  See section 516A of the Act.  Therefore,
even if the Department, of its own volition, were to reinterpret U.S.
law in light of the 1992 GATT panel report, it lacks the legal
authority in this review to revoke the order or otherwise rescind the
initiation of the underlying investigation based on lack of industry
support at the time of initiation.  See also Gray Portland Cement and
Clinker from Mexico; Final Results of Antidumping Duty Administrative
Review, 62 FR 17581 (April 10,1997) (93/94 Review Final Results);
Gray Portland Cement and Clinker from Mexico; Final Results of
Antidumping Duty Administrative Review, 62 FR 17148 (April 9, 1997)
(94/95 Review Final Results); Gray Portland Cement and Clinker from
Mexico; Final Results of Antidumping Duty Administrative Review, 63
FR 12764 (March 16, 1998) (95/96 Review Final Results); Gray Portland
Cement and Clinker from Mexico; Final Results of Antidumping Duty
Administrative Review, 64 FR 13148 (March 17, 1999) (96/97 Review
Final Results).

Of the cases cited by CEMEX and CDC, none of them supports the
argument that the Department has the authority, in an administrative
review under section 751(a) of the Act, to reach back almost ten
years and reexamine the issue of industry support for the original
petition.  In Gilmore Steel, the plaintiff contended that the
Department lacked the authority to rescind the investigation based
upon insufficient industry support for the petition after the 20-day
period established in section 732(c) of the Act had elapsed.  585 F.
Supp. at 673.  In Zenith Electronics, the plaintiff alleged that the
petitioner was no longer a domestic "interested party" with standing
to request an administrative review.  872 F. Supp. at 994.  Nothing
in Zenith Electronics or Gilmore Steel supports CDC's argument that a
party may challenge industry support for a petition almost ten years
after the fact in the context of an administrative review under
section 751(a) of the Act.

The case cited by CDC, Oregon Steel Mills, involved a challenge to
the Department's authority to revoke an antidumping duty order based
upon new facts, i.e., the industry's affirmative expression of no
further support for the antidumping duty order, not upon a
reexamination of the facts as they existed during the original LTFV
investigation.  The Federal Circuit (CAFC) held that it was lawful
for the Department, in the context of a "changed circumstances"
review pursuant to section 751(b) of the Act, to revoke an order over
the objection of one member of the industry.  862 F.2d at 1544-46.
The court did not state that industry support for an order must be
affirmatively established throughout the life of an order.  Indeed,
the court went to lengths to explain that it was not ruling on the
claim that "loss of industry support for an existing order creates a
'jurisdictional defect.'"  Id. at 1545 n. 4.  As courts explained
subsequently, the holding in Oregon Steel Mills is limited to the
proposition that the Department may, but need not, revoke an order
when presented with record evidence which demonstrates a lack of
industry support for the continuation of the order.  See, e.g.,
Suramerica de Aleaciones Laminda, C.A. v. United States, 966 F.2d
660, 666 (Fed. Cir. 1992) (Suramerica), and Citrosuco Paulista, S.A.
v.  United States, 704 F. Supp. 1075, 1085 (CIT 1988) (Citrosuco).

Finally, as we mentioned in the final results of the last five
administrative reviews, numerous courts upheld our practice under the
pre-URAA statute of assuming, in the absence of evidence to the
contrary, that a petition filed on behalf of a regional or national
industry is supported by that industry.  See, e.g., NTN Bearing Corp.
v. United States, 757 F. Supp. 1425, 1427-30 (CIT 1991), Citrosuco,
704 F. Supp. at 1085, and Comeau Seafoods v. United States, 724 F.
Supp. 1407, 1410-12 (CIT 1989).  Indeed, this issue raised by CEMEX
and CDC was before the Federal Circuit in the Suramerica case (966
F.2d at 665, 667).  In Suramerica the plaintiffs challenged the
Department's interpretation of the phrase "on behalf of" which
applied to both national-industry and regional-industry cases.  In
affirming the Department's practice, the court observed that the
phrase "on behalf of" was not defined in the statute.  Id. at 666-
667.  The statute was, in fact, open "to several possible
interpretations."  In the opinion of the court, the Department's
practice with regard to standing and industry support for a petition
reflected a reasonable "middle position."  966 F.2d at 667.  While
there was a gap in the statute, the court stated, "Congress did make
[one thing] clear--Commerce has broad discretion in deciding when to
pursue an investigation, and when to terminate one."  Id.  Although
not considered legal precedent, our decision not to revoke the
underlying order has been upheld by NAFTA panels.  See, e.g., NAFTA
Panel Review (94/95 Review) Opinion and Order of the Panel (June 18,
1999).  Therefore, we reject respondents arguments that we lack the
authority to assess antidumping duties pursuant to these final
results of review and that we must revoke the underlying antidumping
duty order.


2. As Invoiced vs. As Produced

Comment 2:  The petitioner contends that the Department erred
by matching merchandise on the basis of the ASTM cement type "as
produced" rather than matching, as it had done in the original
investigation and in the first five administrative reviews, on an "as
invoiced" basis.  The petitioner argues that matching merchandise on
an "as produced" basis is inconsistent with the Departments matching
practices of commercially significant characteristics.  The
petitioner asserts, however, that if the Department continues to find
home-market sales of cement produced as Type V and Type V LA outside
the ordinary course of trade, then it does not object to the
Departments methodology of matching cement on an "as produced" basis
because this methodology will have no impact on the dumping margin.

CEMEX responds that the Department matched identical merchandise
properly on the basis of the ASTM specification to which the cement
was produced.  CEMEX argues that matching merchandise according to
how it was sold does not meet the statutory requirement of section
771(16) of the Act, which requires that the "foreign like product"
include only merchandise sold in the comparison market that is
physically identical with the merchandise produced for sale to the
United States.  CEMEX argues that, as the Department recognized in
the 95/96 and 96/97 review final results, the statute compels the
Department to base normal value on its sales of cement that meet the
customers' specifications physically.  CEMEX notes that the
petitioner raises the same arguments already rejected by the
Department in the 95/96 and 96/97 reviews.  CEMEX points out that, in
this case, no party disputes that product characteristics of cement
are determined on the highest ASTM specifications that it meets.
Therefore, CEMEX concludes, the Department's identification of home-
market cement sales pursuant to the highest ASTM specifications to
which the cement is produced continues to be in accordance with law.

Departments Position:  For these final results of review, we found
that home-market sales of Type V and Type V LA cement are outside the
ordinary course of trade.  Thus, regardless of whether we adopt an
"as produced " or "as sold" methodology, we would be comparing U.S.
sales to sales of Type I cement in Mexico.  Notwithstanding this
fact, we found, as we did in the 96/97 administrative review of this
order, that CEMEX continues to produce cement meeting the physical
requirements of one type of cement and sells that cement as another
cement type.  Therefore, we have maintained our practice of matching
the foreign like product that is physically identical to the
merchandise produced for sales in the U.S. market.  As our position
has not changed since the 96/97 review, we adopt the discussion in
those final results with respect to this issue.  See 64 FR at 13154.


3.  Ordinary Course of Trade

Comment 3:  CEMEX argues that its home-market sales of cement
produced as Type V LA at its Hermosillo plants were in the ordinary
course of trade and should be used in the calculation of normal
value.  CEMEX challenges the validity of the factors the Department
used in its analysis to determine whether sales of cement produced as
Type V LA ware made outside the ordinary course of trade.  CEMEX
argues that the Department applied selected factors in performing its
ordinary-course-of-trade analysis and that the Department's analysis
was not supported by substantial evidence.  CEMEX contends further
that sales produced as Type V LA and specifically those invoiced as
Type II LA and Type V LA were made pursuant to a bona fide home-
market demand for those types of cement, that the merchandise sold
was not obsolete or of second quality, that it was sold for its
intended purposes, and that there were no special sales arrangements
for sales of these cement types.

Concerning the sales-volume factor, CEMEX contends that the
Department's analysis relies incorrectly on the volume of the sales
at issue relative to sales of Type I cement and
that the volume of the sales at issue was significant in absolute
terms and pursuant to a bona fide demand.  CEMEX also argues that
judicial precedent and prior administrative practice establish that
relatively low sales volume signifies sales outside the ordinary
course of trade only when coupled with an absence of a bona fide
demand in the home market, which does not exist in this case.

With respect to shipping arrangements, CEMEX contends that the
Department should focus on the actual terms of delivery for the sales
at issue, identical to those of Type I customers, rather than the
geographic distance.  CEMEX points out that the distance to the
customers is a geographic fact rather than a condition or practice of
sale as required by section 771(15) of the Act.  CEMEX maintains that
in no other cases has the Department relied on shipping distances in
determining whether sales were outside the ordinary course of trade.
Furthermore, CEMEX argues, if the Department continues to consider
shipping distance in its analysis, it should do so on an individual-
sale basis.

CEMEX argues that the Department's reliance on the low
profitability of the sales at issue ignores the fact that the profit
levels on these sales, though not as high as sales invoiced as Type
I, are substantial and significant in absolute terms.  CEMEX points
out that the Departments regulations suggest that very high
disparities or relatively negative profit rates, as evidenced in the
91/92 administrative review, would demonstrate sales made outside the
ordinary course of trade, which is not the situation in this review.

CEMEX contends further that the Department's reliance on the small
number and type of customers for cement produced as Type V LA, and
specifically with respect to those invoiced as Type II LA and Type V
LA, is improper because such evidence generally reflects sales
outside the ordinary course of trade in cases of sales of export
overrun and off-specification sales, rather than when sales are made
to a bona fide home market.  Moreover, CEMEX argues that the
Department should focus its quantity-per-transaction analysis on bulk-
to-bulk comparisons rather than bulk-to-bag comparisons, in
accordance with the NAFTA panel determination pursuant to the 94/95
administrative review.  CEMEX proffers that this type of analysis
would demonstrate that the average difference in sales quantity per
transaction between cement produced as Type I and cement produced as
Type V LA was not significant enough to warrant a determination that
its sales of cement produced as Type V LA were outside the ordinary
course of trade.

With regard to the historical trade-trends factor, CEMEX argues
that a period of thirteen years of domestic sales of these products,
before and after the imposition of the order, constitutes a
"reasonable period of time" within the meaning of section 771(15) of
the Act.  Concerning Type V cement, CEMEX also argues that the
Department's preliminary results are factually incorrect because
those results did not appreciate the prior history of this case.
Specifically, CEMEX states that the Department did not acknowledge
that, when conducting the 91/92 administrative review, the Department
verified that Tolteca, a CEMEX subsidiary whose production is subject
to this review, has made continuous sales in the home market of Type
V cement since 1964.  Furthermore, CEMEX points out that it began
producing and selling Type V LA cement five years before the issuance
of the order, thereby satisfying the conditions and practices which,
for a reasonable period of time prior to exportation of subject
merchandise, have been normal in the trade under consideration.
Thus, CEMEX contends, historical sales patterns in the home market of
these cement types meet the statutory definition of sales made within
the ordinary course of trade.

Finally, CEMEX maintains that the Departments reliance on facts
available to infer that sales of Type V LA cement that was produced
as Type V LA exhibit a promotional quality not present for sales of
Type I cement is factually incorrect.  CEMEX argues that record
evidence demonstrates that the promotional qualities of cement sold
as Type V LA and Type I cement are identical.  CEMEX challenges the
overall relevance of promotional quality as a factor in an ordinary-
course-of-trade inquiry and argues that there is no judicial or
Departmental precedent that has referred to this factor in any other
ordinary-course-of-trade analysis.
 The petitioner states that, for the preliminary results of review,
the Department determined correctly that CEMEXs home-market sales of
cement produced as Type V and Type V LA (sold as Type I, Type II LA,
or Type V LA cement) were outside the ordinary course of trade.1  The
petitioner asserts that the Department should not evaluate just one
factor in isolation but should consider all the circumstances
particular to the sales in question to determine whether the sales
reflect the conditions and practices which, for a reasonable time
prior to the exportation of the subject merchandise, have been normal
in the trade under consideration.  The petitioner argues that the
Departments preliminary ordinary-course-of trade determination is
consistent with its determination on the same issue in the final
results of several previous administrative reviews.  The petitioner
maintains that, in the instant administrative review, the record
evidence demonstrates that home-market sales of cement produced as
Type V and Type V LA continue to be outside the ordinary course of
trade.

With regard to the changes in production and shipping arrangements,
the petitioner argues that the fact that CEMEX made such a radical
change in its production and distribution of these products since the
issuance of the antidumping duty order for the purpose of bringing
down the margin is strong evidence that sales of those products are
unusual and, thus, outside the ordinary course of trade.

Concerning the absorption of freight costs, the petitioner states
that, prior to the issuance of the antidumping duty order, CEMEX
passed on the cost of freight for Type II and Type V sales to its
customers in higher prices.  After the order, the petitioner asserts,
CEMEX consolidated all Type II and Type V cement production at
Hermosillo which increased the shipping distance to customers in
central Mexico significantly, consequently increasing its freight
expense.  The petitioner contends that, since that time, CEMEX
absorbed the high freight costs and continued to do so during the
instant review.

With regard to the sales-volume factor, the petitioner contends
that CEMEX restricted its home-market sales of Type II cement after
the antidumping duty order by ceasing to offer Type II for sale as a
general-purpose cement and selling it only to those customers
demonstrating a need for low-alkali Type II cement.  The petitioner
asserts that CEMEX offset the much lower prices on Type II LA cement
resulting from the increased transportation costs (incurred due to
shipping small quantities long distances to customers) with higher
prices on Type I cement.

With respect to specialty products sold to a "niche" market, the
petitioner asserts that this situation reflects CEMEXs restriction
of sales of Type II after the antidumping duty order, which it had
sold previously as general-purpose cement.  Moreover, the petitioner
contends the fact that Type II and Type V cement are specialty
products sold to a niche market is demonstrated further by the fact
that, in the instant review period, CDC did not produce Type V LA
cement and, although it has been producing Type II LA cement for
export to the United States, it only began selling a limited quantity
of Type II LA in the home market in December 1997 to a related
customer.

Concerning the percentage sold of cement produced as Type V LA and
sold as Type II LA and Type V LA compared with CEMEXs total home-
market sales of cement, the petitioner points out that, since the
90/91 review, the Department has found that these sales accounted for
a "minuscule percentage of CEMEXs total sales of cement".  The
petitioner contends that the same situation applies for the instant
review.

The petitioner argues that CEMEXs home-market sales of Type II LA
and Type V LA cement produced as Type V LA also account for only a
small percentage of CEMEXs production of Type V LA produced cement.
The petitioner asserts that the extremely limited home-market demand
for sales of Type II LA and Type V LA cement compared to its export
market for those types of cement is similar to sales of "overrun"
merchandise which the Department has found in other cases to be
outside the ordinary course of trade.

In addition, the petitioner points out the unusual nature of the
number, type, and geographic location of customers for CEMEXs cement
produced as Type V LA and sold as Type II LA and Type V LA.  The
petitioner asserts that information on the current record supports
the Departments conclusion that the number and types of customers
for sales of Type II LA cement are very small and very different from
those for other home-market sales.  The petitioner refutes the
argument put forward by CEMEX that the number of customers is
relevant only where the merchandise is not sold to a bona fide home
market, stating that the Department has no such rule of thumb and
evaluates each case according to its own circumstances.

The petitioner asserts that there is no reason for the Department
to distinguish between bulk and bagged sales in its analysis of the
number and type of customers to which CEMEX sold cement produced as
Type V LA and sold as Type II LA and Type V LA cement.  The
petitioner asserts that the only difference between bulk and bagged
cement is the manner in which the sales are packed.

The petitioner also asserts that there was a difference in the
manner in which CEMEX granted discounts and rebates on sales of
cement produced as Type V LA and sold as Type II LA and Type V LA
cement compared to other home-market sales.

With regard to CEMEXs profit on cement produced as Type V LA and
sold as Type II LA and Type V LA sales, the petitioner asserts that
the revised data CEMEX submitted indicates a large difference in
profit rates and not a "minor" or "insignificant" difference as
alleged by CEMEX.

In addition to cement produced as Type V LA and sold as Type V LA
and Type II LA, the petitioner contends that CEMEXs home-market
sales of cement produced as Type V and Type V LA but sold as Type I
are also outside the ordinary course of trade.  The petitioner states
that many of the factors which were relevant in determining whether
CEMEXs cement produced as Type V LA and sold as Type II LA and Type
V LA cement are outside the ordinary course of trade are also
relevant in determining whether sales of Type I cement produced as
Type V and Type V LA cement are outside the ordinary course of trade.
In addition to those factors, the petitioner argues that CEMEX
consistently produced Type V and Type V LA cement and sold it as Type
I cement at the two Hermosillo plants, even though no legitimate
demand in Mexico exists for Type V and Type V LA cement.

The petitioner states that, while the circumstances with respect to
CEMEXs Type V LA cement sold as Type I from Hermosillo have not
changed materially since the 96/97 review, two other aspects of
CEMEXs home-market sales of cement produced as Type V cement and
sold as Type I cement have changed.  The petitioner discusses several
reasons why these factual changes do not alter the fact that the
sales are outside the ordinary course of trade.  However, the
petitioner comments that CEMEX has reported producing Type V LA
cement at the Hidalgo plant and selling it as Type I cement, and that
these sales were made under temporary and highly unusual
circumstances.  Therefore, such sales were outside the ordinary
course of trade.  Thus, the petitioner maintains, only the two
Hermosillo plants produced Type V LA cement that was sold
consistently as Type I cement.  The petitioner points out further
that CEMEX has also reported that, in January 1998, the Yaqui Plant
began producing Type V cement that did not meet the ASTM standard for
low-alkali cement and which it sold in the home market as Type I
cement.  The petitioner argues that Type V produced cement sold as
Type I is outside the ordinary course of trade for many of the same
reasons that Type V LA produced cement sold as Type I cement is
outside the ordinary course of trade.

The petitioner adds additional factors which it contends support
the Departments analysis on this issue:  CEMEX is silent with
respect to Type I cement sales which were produced as Type V cement
at the Hidalgo plant; lack of demand in Mexico for Type V cement
which does not meet the optional low-alkali specification; Type V and
Type V LA cement sold as Type I accounts for a very small percentage
of CEMEXs home-market sales; the relatively small number and type of
customers for cement produced as Type V and Type V LA cement sold and
sold as Type I cement.

Department's Position:  In the instant administrative review, CEMEX
produced Type V LA cement at its Campana, Yaqui (located in the
Hermosillo region), and Hidalgo plants in Mexico.  It sold this
cement as either Type I, Type II LA, or Type V LA cement.  It also
produced Type V cement which it sold only as Type I cement.  We have
found that home-market  sales of cement produced as Type I and sold
as Type I cement are within the ordinary course of trade.  Our
ordinary-course-of trade analysis is focused on CEMEXs cement that
was produced as Type V LA or Type V and sold as Type V LA, Type II
LA, or Type I in Mexico.

As we stated in our final ordinary-course-of-trade memorandum, we
determined that CEMEXs sales of cement produced as Type V and sold
as Type I were outside the ordinary course of trade.  See the
Ordinary-Course-of-Trade Memorandum for the Final Results of Review
from Davina Hashmi to Laurie Parkhill, dated March 6, 2000, available
in the Departments Central Record Unit, room B-099.  We made this
determination based on the small sales volume and quantity of this
cement type, coupled with the lack of demand in the home market and
the fact that CEMEX produced Type V cement with the understanding
that it would be sold as another cement type, Type I.

In its case brief, CEMEX did not address our finding that cement
produced as Type V and sold as Type I was outside the ordinary course
of trade.  Therefore, the following ordinary-course-of-trade
discussion does not pertain to cement produced as Type V.  For
further discussion of cement produced as Type V, see the final
ordinary-course-of-trade memorandum, dated March 6, 2000.

CEMEX produced Type V LA cement at its Hidalgo and Hermosillo
plants.  However, CEMEX produced Type V LA cement at the Hidalgo
plant inadvertently as the result of an effort to produce another
cement type.  Since the production of this cement type was
unintentional and unusual and it was sold only as Type I cement, we
found sales of this cement to be outside the ordinary course of
trade.  Therefore, the analysis contained herein focuses on cement
produced as Type V LA at the Hermosillo plants, irrespective of how
sold (i.e., Type V LA, Type II LA, or Type I).

Section 773(a)(1)(B) of the Act states, in part, that normal value
is the "price at which the foreign like product is first sold (or, in
absence of a sale, offered for sale) for consumption in the exporting
country, in the usual commercial quantities and in the ordinary
course of trade."  The term "ordinary course of trade" is defined as
"the conditions and practices which, for a reasonable time prior to
the exportation of the subject merchandise, have been normal in the
trade under consideration with respect to merchandise of the same
class or kind."  The Statement of Administrative Action (SAA) which
accompanied the passage of the URAA clarifies this portion of the
statute further when it states:

  Commerce may consider other types of sales or transactions to be
  outside the ordinary course of trade when such sales or transactions
  have characteristics that are not ordinary as compared to sales or
  transactions generally made in the same market.

SAA, at 834.

Thus, the statute and the SAA are clear that a determination of
whether sales (other than those addressed specifically in section
771(15) of the Act) are in the ordinary course of trade must be
based on an analysis comparing the sales in question with sales of
merchandise of the same class or kind generally made in the home
market (i.e., the Department must consider whether certain sales
of cement in Mexico are ordinary in comparison with other sales
of cement in Mexico).

The purpose of the ordinary-course-of-trade provision "is to
prevent dumping margins from being based on sales which are not
representative" of the home market.  See NTN Bearing Corp. of America
v. United States, Slip Op. 99-71 at 21-22 (CIT, July 24, 1999) (NTN
Bearing Corp.).  Congress has not specified any criteria that the
agency should use in determining the appropriate "conditions and
practices".  Thus, the Department, in its discretion, chooses how
best to analyze the many factors involved in a determination of
whether sales are made within the ordinary course of trade.  Id.

In the instant review, the Department's decision to exclude cement
produced as Type V LA from the calculation of normal value centered
on the unusual nature and characteristics of these sales compared to
CEMEX's sales of other types of gray portland cement, which consisted
primarily of Type I cement.  The Department's ordinary-course-of-
trade analysis is far-reaching.  The agency must evaluate not just
"one factor taken in isolation but rather all the circumstances
particular to the sales in question" (Murata Mfg. Co. v. United
States, 820 F. Supp. 603, 607 (CIT 1993) (quoting Certain Welded
Carbon Steel Standard Pipes and Tubes from India, Final Results of
Antidumping Duty Administrative Review, 56 FR 64753, 64755 (December
12, 1991) (Pipes and Tubes from India); see also NTN Bearing Corp.,
supra).  This broad approach recognizes that each company has its own
conditions and practices particular to its trade.  In short, the
Department examines the totality of the facts in each case to
determine if sales are being made for "unusual reasons" or under
"unusual circumstances."  See Antifriction Bearings (Other Than
Tapered Roller Bearings) and Parts Thereof From France, et. al; Final
Results of Antidumping Duty Administrative Review, 64 FR 35590, 35620-
21 (July 1, 1999), and  Electrolytic Manganese Dioxide from Japan;
Final Results of Antidumping Duty Administrative Review, 58 FR 28551,
28552 (May 14, 1993).

We have revisited our ordinary-course-of-trade analysis for these
final results of review.  For this analysis, we concentrated on the
sales-transaction volumes, quantity or tonnage sold, shipping
distances, freight costs, and average profit as factors to support
our finding that, as we determined for the preliminary results of
review, home-market sales of cement produced as Type V LA are outside
the ordinary course of trade.  See the Ordinary-Course-of-Trade
Memorandum.  Based on this analysis, we found that, during the period
of review, as in previous reviews, CEMEX made very few home-market
sales of cement produced as Type V LA compared to its sales of cement
produced as Type I cement.  We also found that the tonnage CEMEX sold
in Mexico of cement produced as Type V LA was very small compared to
the tonnage of cement produced as Type I.  Thus, it was evident from
this analysis alone that the sales of cement produced as Type V LA in
comparison to cement produced as Type I constituted a practice that
was unusual in the context of CEMEX's sales in Mexico.

With regard to shipping distances, the normal practice for CEMEX is
to ship cement, a heavy material, over relatively short distances.
The majority of CEMEX's sales of cement in Mexico were shipped less
than 150 miles from the production site and, during the period of
review, shipments of cement produced as Type I cement conformed to
this pattern.  Shipments of cement produced as Type V LA and sold as
Type II LA and Type V LA, however, traveled over vastly greater
distances.

We found that freight costs for cement produced as Type V LA, and
specifically those with regard to sales of Type V LA and Type II LA,
were considerably higher than the freight costs for cement produced
as Type I and sold as Type I.  We also found that CEMEX's profit on
cement produced as Type V LA during the period of review was small
compared to profit it earned on cement produced as Type I and Type V.
These factors indicate that CEMEX is absorbing the high freight costs
incurred to transport its cement produced as Type V LA (particularly
with regard to cement produced as Type V LA that was sold as Type V
LA and Type II LA) over great distances to its customers located more
than 1200 miles from the production site.  For the years preceding
the antidumping order, it was CEMEX's normal business practice to
pass along the cost of pre-sale freight to purchasers of its Type II
cement.  Therefore, we find it an "unusual circumstance" for CEMEX to
absorb freight costs on its cement produced as Type V LA compared
with cement produced as Type I.  For further discussion on the
factors with reference to proprietary data, see the final ordinary-
course-of-trade memorandum from Davina Hashmi to Laurie Parkhill,
dated March 6, 2000.

We disagree with CEMEX's contention that our analysis relied
incorrectly on the relative sales volume of cement produced as Type V
LA compared with cement produced and sold as Type I cement.  The
relative sales volume has often played an important role as one of
the factors in our overall analysis of whether sales are within the
ordinary course of trade.  See Furfuryl Alcohol From Thailand; Final
Results of Administrative Review, 60 FR 22557, 22559 (May 8, 1995)
(subject sales compared to "standard" volumes).  In previous cases we
have stated that, "while the number of sales or volume sold are not
in and of themselves definitive factors in determining whether the
sales in question are in the ordinary course of trade, this factor
coupled with others may result in a finding that sales are not in
the ordinary course of trade" (Pipes and Tubes from India; Final
Results of Administrative Review, 56 FR at 64755 (emphasis added);
Murata, 820 F. Supp. at 607 (quoting Pipes and Tubes from India);
Certain Corrosion-Resistant Carbon Steel Flat Products From
Australia; Final Results of Administrative Review, 61 FR 14049, 14051
(March 29, 1996) (relative sales volume coupled with other factors
led to conclusion that sales were within the ordinary course of
trade)).  Thus, we are not questioning whether the sales of cement
produced as Type V LA constitute bona fide sales, as CEMEX suggests
we should.  Rather, we question whether the sales of cement produced
as Type V LA were made in the usual course of business.  Given the
number of sales of cement produced as Type V LA made in Mexico during
the instant period of review relative to the number of sales of Type
I cement, it is evident that CEMEX's sales of the cement in question
was, in fact, unusual and not representative of its normal sales
pattern.  This sales pattern demonstrates that CEMEX's main business
in Mexico is Type I cement, not Type V LA cement.  In addition, the
CAFC in CEMEX, S.A. v. United States, 133 F.3d 897 (Fed. Cir. 1998)
(CEMEX v. U.S.), affirmed our determination that CEMEX's sales in the
home market of Types II and V were outside the ordinary course of
trade based, in part, on relative sales volume.  We have excluded
transactions from the calculation of normal value based upon low or
negligible sales volume in other cases as well.  See Tapered Roller
Bearings and Parts Thereof, Finished and Unfinished, From Japan;
Final Results of Administrative Review, 52 FR 30700, 30704 (August
17, 1987), and New Minivans from Japan; Final Results of
Administrative Review, 57 FR 43, 46 (January 2, 1992).  Thus, it has
been our long-standing practice to consider the relative sales
volume, along with other factors, in our ordinary-course-of-trade
analysis.

We also disagree with CEMEX's claim that, instead of considering
shipping distances and freight costs, we should focus on shipping
terms and practices.  We have taken into consideration both the
shipping distances and shipping terms and practices for these final
results of review.  With respect to shipping distances, we found that
the normal practice in Mexico is to ship cement over relatively short
distances.  CEMEX itself has conceded that shipping long distances by
rail or truck is not ordinary in the cement industry.  As we noted
earlier, the majority of CEMEX's cement shipments in Mexico of Type I
cement cover distances of less than 150 miles whereas its shipments
of cement produced as Type V LA traveled over substantially greater
distances.  CEMEX claims that the "differences in shipping distances
is simply a geographic fact" and the result of a "legitimate business
decision" and that the Department has not relied on shipping
distances in determining whether sales were outside of the ordinary
course of trade in prior cases.  These claims are inapposite.  We are
not questioning the reasoning behind its sales decision but rather
the effect of the decision to ship over long distances.  As we noted
in earlier reviews, a company may have sound business reasons for
changing its methods of operation but, if sales resulting from this
new business practice are not normal for the company, then they
cannot be within that company's ordinary course of trade.  The CIT
and CAFC affirmed this analysis in their examination of the 90/91
administrative review.  See CEMEX v. U.S.

The shipping-distance factor is an important factor as it relates
to the freight costs involved in making the sale and also centers on
the question of whether a company absorbs such freight costs.  CEMEX
has acknowledged that transportation is a major cost factor in the
industry.  In support of this fact, we found that CEMEX incurs much
greater freight costs on sales of Type V LA produced cement.
Moreover, we found that CEMEX is absorbing the costs of freight in
making these sales as compared with sales of Type I cement.  Not only
is this an unusual business practice for CEMEX but, for years
preceding the antidumping duty order, it was CEMEX's normal business
practice to include the cost of pre-sale freight in the sales price
to its customers of its Type V LA cement.  For CEMEX to absorb
freight costs after the issuance of the order is an "unusual
circumstance," particularly given the high freight costs for cement.

With respect to shipping terms, while it is true, as CEMEX points
out, that shipping  terms (e.g., CIF or FOB plant) for sales of
cement produced as Type V LA are similar to those for cement produced
as Type I, we believe this contention proceeds from an incorrect
premise.  In an ordinary-course-of-trade analysis, the pertinent
issue is whether the conditions and practices are "normal" for the
company in question.  As noted above, shipping heavy merchandise,
such as cement, over vast distances, incurring and absorbing high
freight costs, is not a normal practice in the cement industry.

CEMEX argues that the Department misapplied the factors of
historical sales trends and promotional quality to the record
evidence.  We did not take these factors into account in our revised
ordinary-course-of-trade analysis.  We found that, of the factors
that we considered for these final results of review, the record
information provided strong enough support, absent the factors
concerning historical sales trends and promotional quality, to find
that sales of cement produced as Type V and Type V LA were outside
the ordinary course of trade.


4.  Level of Trade

Comment 4:  The petitioner contends that, in determining the levels
of trade of both CEMEX and CDC, the Department focused only on
selling functions in its level-of-trade analysis and did not consider
whether the merchandise was sold at distinct stages of distribution.
The petitioner points out that, consistent with the preamble to the
Departments regulations and Department practice and with the
analysis performed for the final results of the 94/95 review, selling
functions alone are not sufficient to establish differences in levels
of trade.  The petitioner asserts that, had the Department considered
the stages of distribution in its level-of-trade analysis, the
Department would have found that no differences exist between CDCs
and CEMEXs home-market and U.S. stages of distribution and,
consequently, found that there was no basis for finding differences
in levels of trade.

CEMEX and CDC disagree with the petitioners assertion that the
Department did not take into account stages of distribution in its
level-of-trade analysis.  CDC points out that the Departments level-
of-trade memorandum specifies that the Department began its analysis
by examining the customers to which it sold comparison merchandise,
the distribution channels through which such merchandise was sold
("stages of distribution"), and the selling functions associated with
each stage of distribution.  CDC maintains that this type of
examination was performed in accordance with Department practice and
was also addressed in the verification report and in the level-of-
trade memorandum.  Moreover, CEMEX and CDC assert that the Department
addressed the relevant stages of distribution in the preliminary
results.

Departments Position:  Our level-of-trade analysis focuses both on
the selling functions performed by the foreign producer/exporter as
well as the stages of distribution.  We cannot divorce one factor
from the other in performing our analysis.  The selling functions,
themselves, play a prominent role in our level-of-trade analysis.
The regulations at 19 CFR 351.412(c)(2) make clear that differences
in selling activities are indicative of differences in stages of
marketing.  Furthermore, as stated in the SAA at 829, "[n]ominal
reference to a company as a wholesaler [i.e., customer category],
for example, will not be sufficient."

While the stages of distribution play a role in our analysis, the
petitioners suggestion that we consider the levels of trade on the
basis of customer categories is misplaced.  For normal value, our
level-of-trade analysis is concerned with the sale made to the
customer in the home market.  That is, the normal-value level of
trade is that of the starting-price sale in the home market.  For
constructed-export-price (CEP) transactions, we are concerned with
the sale made to the U.S. affiliated importer.  That is, the U.S.
level of trade is the level of the constructed sale from the exporter
to the affiliated importer.  In performing our level-of-trade
analysis for CEP transactions, we are not concerned with the sale
made to the unaffiliated customer in the United States.

Therefore, even if all of the selling functions are the same for
the sale made to the unaffiliated customers in the home market and in
the United States, we deduct the selling functions that arose in
making the sale to the unaffiliated customer in the United States
pursuant to section 772(d) of the Act.  While the analysis may begin
with the starting price for CEP, after the 772(d) deductions, we find
a different level of trade, that of the CEP, not the CEP starting
price.  Thus, in a CEP situation, the levels of trade in the home
market and the United States are not likely to be the same.  Having
made the deduction for selling functions pursuant to section 772(d)
of the Act, the selling functions at issue are those that the
producer performed in making the sale to the U.S. affiliate or
reseller.  In the instant case, having made the deductions from the
starting price for CEP, in accordance with section 772(d) of the Act,
we find that the normal- value level of trade is different and more
remote from the factory than the CEP level of trade.

Comment 5:  The petitioner argues that the Department's methodology
for determining the level of trade for CEP sales based on the level
of the CEP from the exporter to the related affiliated importer
(after deductions required by section 772(d) of the Act) is contrary
to the Act and inconsistent with the methodology the Department used
to determine level of trade for export-price and normal-value sales.
Citing Borden, Inc. v. United States, 4 F. Supp.2d 1221 (CIT 1998)
(Borden), the petitioner contends that the CIT found this methodology
to be contrary to the requirements of the plain language of the
statute.

The petitioner asserts that, in order to make an ``apples-to-
apples'' level-of-trade comparison, the statute requires the
Department to analyze the level of trade for both home-market and CEP
sales equivalently, based on the selling functions performed with
respect to the sales to the first unaffiliated customer in both
markets.  In particular, the petitioner contends that, in determining
the levels of trade of both CEMEX and CDC as outlined in its level-of-
trade memorandum dated August 30, 1999, the Department only focused
on selling functions in its level-of-trade analysis and did not
consider whether the merchandise was sold at distinct stages of
distribution.  The petitioner asserts that, had the Department
considered the stages of distribution in its level-of-trade analysis,
the Department would have found that no differences exist between
CDCs and CEMEXs home-market and U.S. stages of distribution and,
consequently, found that there was no basis for finding differences
in levels of trade.  The petitioner contends further that, by using
the adjusted CEP rather than the CEP starting price in the level-of-
trade analysis, the Department is creating and, thus, guaranteeing
differences in levels of trade.  The petitioner concludes that the
Department's practice results in an unfair, skewed comparison between
an adjusted CEP and an unadjusted normal value.

CEMEX and CDC respond that the Department interpreted section 772(d)
of the Act properly and based the CEP level of trade appropriately
on the U.S. price after adjustments.  CEMEX and CDC argue that the
petitioner's sole reliance upon the CIT decision in Borden is
misplaced
because, as the Department stated in prior determinations, the
decision
is not final and the Department is appealing the decision.  The
respondents also assert that the Department's interpretation of the
statute is supported in the SAA and the Department's regulations as
well as by Department practice.  CEMEX also comments that the
Department
addressed this specific issue in the preamble to the proposed
regulations
which indicates that using the starting price to determine level of
trade
results in a meaningless comparison.

In addition, CEMEX and CDC disagree with the petitioners assertion
that the Department did not take stages of distribution into account
in its level-of-trade analysis.  CDC points out that the Departments
level-of-trade memorandum specifies that the Department began its
analysis by examining the customers to which it sells cement, the
distribution channels through which such merchandise was sold
("stages of distribution"), and the selling functions associated with
each stage of distribution.  CDC maintains that this type of
examination was performed in accordance with Department practice and
was also addressed in the verification report and in the level-of-
trade memorandum.  Moreover, CEMEX and CDC assert that the Department
addressed the relevant stages of distribution in the preliminary
results.

Departments Position:  Our level-of-trade analysis in this review
is consistent with the statute.  In determining whether a level-of-
trade adjustment is necessary, section 773(a)(7)(B) of the Act
directs us to either (1) make due allowance for any difference
between the CEP and normal value, or (2) include a CEP offset in the
situation where "normal value is established at a level of trade
which constitutes a more advanced stage of distribution than the
level of trade of the CEP...."  Section 772(b) of the Act defines the
CEP as "the price at which the subject merchandise is first sold...in
the United States...by or for the account of the producer or exporter
of such merchandise or by a seller affiliated with the producer or
exporter, to a purchaser not affiliated with the producer or
exporter, as adjusted under subsections (c) and (d)" (emphasis
added).  In the case of CEP, section 351.412(c)(1)(ii) of the
Departments regulations directs us to identify "the starting price,
as adjusted under section 772(d) of the Act" (emphasis added).
Therefore, the statute and regulations are clear that we are to
analyze the adjusted price pertaining to the sale made by the U.S.
affiliated importer to the unaffiliated purchaser.  Accordingly, our
level-of-trade analysis is in full compliance with both the statute
and regulations.

The CIT held in Borden that our practice of determining levels of
trade for CEP transactions after CEP deductions is an impermissible
interpretation of section 772(d) of the Act.  We believe, however,
that our practice is in full compliance with the statute.  On June 4,
1999, the CIT entered final judgment in Borden on the level-of-trade
issue.   Borden, Inc. v. United States (Court No. 96-08-01970, Slip
Op. 99-50 (CIT June 4, 1999)).  We have filed an appeal of Borden
which is pending before the CAFC.  Consequently, we have continued to
follow our normal practice of adjusting the CEP under section 772(d)
of the Act prior to starting a level-of-trade analysis, as
articulated by our regulations at 19 CFR 351.412.

Comment 6:  The petitioner contends that the Departments level-of-
trade analysis in this review is inconsistent with the final results
of the 94/95 review where the Department compared an unadjusted CEP
to an unadjusted normal value and determined that no differences
exist with respect to CEMEXs and CDCs levels of trade.  The
petitioner maintains that the facts underlying CEMEXs and CDCs
distribution systems are not different from those reported by both
companies in the 94/95 review and, therefore, the Department should
maintain a consistent approach, citing Certain Fresh-Cut Flowers From
Colombia; Final Results of Review, 62 FR 53287, 53296-98 (October 14,
1997).  Accordingly, the petitioner argues, the Department should
reach the same conclusions in this review as it did for the final
results of the 94/95 review and deny a level-of-trade adjustment to
normal value for CEMEX and CDC.

CEMEX and CDC maintain that, since the submission of the
petitioners case brief, the Department issued its draft results of
the remand in the 94/95 review in which the Department reversed its
original position and ultimately granted a CEP offset to both
respondents.  Accordingly, CEMEX and CDC argue that, since the
preliminary results now mirror those determined by the Department in
the remand of the 94/95 review, this is a moot issue.

Departments Position:  Since the time that the petitioner filed
its case brief, we have issued the final remand determination for the
94/95 review.  In that remand, we revisited our level-of-trade
analysis that we had performed for the administrative review and
found that, based on record information, the circumstances warranted
a CEP-offset adjustment to normal value.  Consequently, our level-of-
trade analysis in this review is not inconsistent with our final
analysis in the 94/95 review.

Comment 7:  The petitioner argues that CEMEX and CDC did not
fulfill their burden of substantiating that their sales in the home
market were at a different and more advanced stage of distribution
than their sales in the United States.  The petitioner challenges the
selling functions reported by CEMEX and CDC in their selling-
functions charts and argues that the Department should not consider
selling functions associated with movement, packing, and direct
selling expenses.  The petitioner contends that neither company
demonstrated that its reported selling functions correspond to the
expenses reported in its sales listing, including CEMEXs reported
itemized home-market indirect selling expenses.

The petitioner maintains that the Departments level-of-trade
analysis was flawed further by neglecting to measure properly the
intensity of the reported selling functions and by not determining
the frequency with which each selling function was performed.  The
petitioner argues that, in performing its analysis, the Department
did not quantify the expenses incurred with regard to each selling
function.  Moreover, the petitioner asserts, certain selling
functions CEMEX and CDC reported were not described fully or
supported with sufficient information to be deemed selling functions,
including market research, procurement and sourcing, personnel
training, and after-sales services/warranties.

With respect to CEMEX, the petitioner alleges that an inconsistency
exists between the selling functions that CEMEX discussed in the
narrative portions of its response and those included in its selling-
functions chart.  The petitioner points out that CEMEX did not
respond to the Departments requests to reconcile such
inconsistencies, particularly with respect to the personnel
training/exchange and procurement and sourcing selling functions.
The petitioner notes that, contrary to information on the record, the
Department discerned incorrectly that CEMEX did not perform
advertising in the U.S. market and requests that the Department
change the designation of this selling function in the level-of-trade
memorandum.

In addition, the petitioner asserts that, with respect to CDC, home-
market selling functions must be provided to at least the majority of
customers and that minor or relatively insignificant selling
functions cannot provide the basis for a determination that there are
different levels of trade and that a CEP-offset adjustment is
warranted.

Further, the petitioner provided its own selling-functions chart
listing eight selling activities performed by CEMEX and CDC which the
petitioner believes are relevant to determining whether the levels of
trade in the United States and Mexico are similar.  The activities
listed in the petitioners chart includes the following: (1)
inventory maintenance, (2) market research, (3) after-sales
service/warranties, (4) technical advice, (5) advertising, (6)
solicitation of orders, (7) computer/legal/accounting/business, (8)
accounts receivable management.  In this chart, the petitioner
indicates that the respondents performed all eight of these
activities in Mexico and six activities performed in the United
States, indicating that the market research and after-sales
warranties were not performed in the United States.  On this basis,
the petitioner asserts that the levels of trade in the United States
and Mexico are similar such that a CEP-offset adjustment is not
warranted.

CEMEX and CDC contend that they provided in their responses
detailed descriptions of their reported selling functions and the
degree to which each selling function was performed in both the home
market and the United States.  The respondents point out that, at
verification, the Department examined their claimed selling functions
and the degree to which such functions were performed.  CEMEX and CDC
note that the Department verified similar information in the last
three administrative reviews and found in those reviews, as well as
in the instant review, that the level-of-trade information was
reported accurately.

CEMEX asserts that, based on the law and verified information on
the record, the Department's preliminary results included a CEP
offset properly.  CEMEX contends that it performs significantly more
selling functions at a higher level of intensity for sales made in
the home market than for sales made to its affiliated U.S.
distributor, Sunbelt Cement.  CEMEX argues that, in its response, it
indicated that numerous links in the distribution chain exist with
respect to sales made in the home market whereas only one link in the
distribution chain exists with respect to sales made to Sunbelt
Cement.  In addition, CEMEX refutes the petitioners argument that
its itemized indirect selling expenses do not correspond to its
reported selling functions.  CEMEX argues that there is no statutory,
regulatory, judicial, or administrative precedent that requires
consistency between the indirect selling expenses and the reported
selling functions or that requires quantifying the expenses in order
for the Department to conduct a proper level-of-trade analysis.
CEMEX explains that the itemized indirect selling expenses are
representative of cost centers in sales departments whereas the
selling functions designate activities performed by department
personnel.  For these reasons, CEMEX and CDC argue, the Department
determined appropriately that the respondents performed significantly
different selling functions for the CEP sales than for the home-
market sales, that the home-market level of trade was more advanced
than the level of the CEP, and that a CEP-offset adjustment was
warranted.

Departments Position:  At the home-market and U.S. verifications
of CEMEX and CDC, we verified the information that the respondents
reported with respect to the level-of-trade issue and found no
discrepancies.  While we did not verify certain reported selling
functions, such as CEMEXs reported procurement and sourcing and
personnel training selling functions performed in the home market, it
is administratively impossible for us to examine every topic (i.e.,
selling function or expense) at verification.  Rather, our objective
is to spot-check the accuracy and completeness of the information
that is submitted to us in the course of an administrative review
rather than to conduct an exhaustive examination of such information.
See Certain Internal-Combustion Industrial Forklift Trucks From
Japan; Final Results of Antidumping Duty Administrative Review, 62 FR
5592, 5602 (February 6, 1997).

Notwithstanding the fact that we verified the level-of-trade topic
pertaining to both companies and were satisfied with the information
that we examined, we address below specific aspects raised by the
petitioner in its case brief.  As a result of the home-market
verification we conducted of specific CEMEX selling functions, the
petitioner argues incorrectly that we should examine individual
transactions because the performance of certain selling functions was
volume-driven.  Nowhere in the statute or the Department regulations
is there a suggestion that we are to conduct level-of-trade analyses
on a transaction-specific basis.  Furthermore, to conduct a level-of-
trade analysis based on the level of detail suggested by the
petitioner would not only be administratively burdensome but would
suggest an overhaul of the manner in which the Department conducts
its level-of-trade analyses.

With respect to the petitioners issue of quantifying selling
functions, our purpose of requesting a respondent to "quantify" the
selling functions that it submits in its response is to measure the
intensity of or the degree to which such selling functions were
performed.  Ascertaining this information provides us with a more
complete picture of the respondents selling practices.  We do not,
as a matter of practice, quantify or sum for purposes of comparison
the expenses that are associated with such selling functions.  Such a
quantitative analysis may be necessary only in factual scenarios in
which we need additional information to better understand the
reported information for purposes of our analysis.  However, in the
instant review, both CEMEX and CDC provided sufficient information
regarding the selling functions and the intensity to which such
functions were performed such that a further analysis was unnecessary.

The petitioner challenges the Departments decision to grant a CEP
offset to normal value for CEMEX by asserting that CEMEXs itemized
list of indirect selling expenses included in the appendices of its
response and the selling functions reported in its selling-functions
chart do not correspond.  However, the list to which the petitioner
refers (page B-48 of CEMEXs December 4, 1998, Section B response)
itemizes the names of CEMEXs accounts for its indirect selling
expenses in the home market and does not provide the services
performed as a result of those expenditures.  Because the list of
accounts upon which the petitioner relies is not an itemization of
CEMEXs selling functions but, rather, lists the accounts in which
CEMEXs selling functions are recorded, we would, therefore, not
expect CEMEXs list of indirect selling expenses and selling-
functions chart to correspond.

We disagree with the petitioners contention that selling functions
associated with movement and packing expenses should not be
considered in identifying levels of trade.  Our original
questionnaire (Section A, question 3.b) requests respondents to list
the types of functions or services performed in each market.  We
identify, as examples ("among others"), the types of activities that
we consider to be functions.  However, this list is not exhaustive.
"Freight and delivery arrangements" or movement is one of the selling
functions that we list.  Moreover, a respondent may deem a number of
activities to be selling functions, such as personnel training or
packing, provided such functions or activities arose as a result of
arranging for, or carrying out, the sale of merchandise.

We agree with the petitioners assertion that we should change in
the selling-functions chart included in our level-of-trade memorandum
the designation of "no" to "yes" for the advertising selling
function.  However, this does not change our conclusion.  Even if we
remove CEMEXs market research and personnel training or CDCs
selling promotions/discount functions from the list of selling
functions that were performed in Mexico and included in our level-of-
trade memorandum, the end result is the same as that we found in the
preliminary results.

In addition, if we did find that the selling functions respondents
performed for sales made to unaffiliated customers in the home market
and the United States were the same, such as those identified by the
petitioner in its case brief at page 71, contrary to the petitioners
assertion, we would not find the U.S. or home-market levels of trade
to the be same.  The petitioner disregards the aspect of the analysis
that is subject to section 772(d) of the Act.  As described in our
responses to Comments 4 and 5, this section of the statute requires
us to deduct from the CEP starting price the "expenses generally
incurred by or for the account of the producer or exporter, or the
affiliated seller in the United States in selling the subject
merchandise" (emphasis added).  We remove from the analysis,
therefore, those functions that give rise to as a result of the
expenses incurred in selling the subject merchandise to the
unaffiliated customer in the United States.  Using, for instance, the
modified selling-functions chart the petitioner provided in its case
brief, we would remove the selling functions that it lists as being
performed in the United States and, by virtue of these deductions,
find different levels of trade.  Based upon our analysis of the
record, we determined, as in the preliminary results of review, that
CEMEXs and CDCs home-market sales occurred at a different and more
advanced levels of trade than the U.S. CEP levels of trade and,
accordingly, made a CEP-offset adjustment to normal value in our
margin calculations.


5.  Constructed Export Price Calculation

Comment 8:  The petitioner contends that the Departments
calculated profit ratio using information from CEMEXs and CDCs
financial statements is understated.  The petitioner requests that,
in accordance with section 771a(f)(2)(C)(i) of the Act, the
Department incorporate into its final margin calculation the verified
cost information submitted by CEMEX and CDC for purposes of
calculating the CEP-profit ratio.

Departments Position:  As we stated in the preliminary analysis
memorandum of September 2, 1999, we relied upon CEMEXs and CDCs
financial statements submitted in the responses because we did not
have the cost data available for the preliminary analysis to
determine the CEP-profit ratio.  For these final results of review,
however, we have incorporated CEMEXs and CDCs post-verification
cost data into our calculations and have used such data for purposes
of calculating the CEP-profit ratio.

Comment 9:  The petitioner disagrees with the Department's decision
not to deduct CEMEXs and CDCs indirect selling expenses incurred in
the home market on sales to its affiliated importer in the United
States (indirect expenses) in calculating the CEP.  The petitioner
believes that this decision, although consistent with the
Department's regulations and current practice as well as the final
results of earlier reviews, is contrary to the Act, the SAA, the
URAA, and judicial precedent.  The petitioner asserts that indirect
selling expenses are not limited under section 772(d)(1) of the Act
and are therefore required to be deducted in accordance with section
772(d)(1)(D) of the Act.

The petitioner explains that, when Congress amended the antidumping
law in the URAA, it intended to retain the pre-URAA deduction made
for direct and indirect expenses, citing House Rep. No. 103-826, at
79 (1994).  In accordance with a clear reading of section 772 of the
Act, the petitioner maintains that Congress intended to treat
indirect expenses in the same way it treated such expenses under the
old law.  Thus, the petitioner argues that the Departments
regulations and current practice concerning the treatment of the
indirect expenses in question are unsupported by the statute and
legislative history.

The petitioner contends that the Department has discretion to
deduct from the CEP all indirect expenses associated with U.S. sales.
The petitioner contends that the Department's use of the term "U.S.
expenses" is limited incorrectly to expenses incurred on and
associated with sales to unaffiliated customers in the United States.
The petitioner asserts that the use of the term should be expanded to
include all expenses incurred in relation to sales made to the
affiliated importer.  Further, the petitioner disagrees with the
Department's narrow interpretation of the language in section 772(d)
of the Act referring to expenses "associated with economic activities
occurring in the United States" to be defined as only those expenses
related to sales by the affiliated importer to unaffiliated
purchasers.  The petitioner contends that the ambiguous language is
interpreted more properly to include all expenses related to U.S.
sales and asserts that indirect expenses are expenses associated with
economic activity occurring in the United States.

The petitioner cites the final results of the 94/95 review to
demonstrate that the Department acted inconsistently with section
772(d) of the Act by limiting the deduction of "any" expenses to
those that arise with respect to activities conducted by the
affiliated importers in order to make a sale.  The petitioner
maintains that, by not deducting indirect expenses from the CEP
starting price, the Department calculated the CEP at an ex-importer
rather than ex-factory price, a price that does not represent an
"apples-to-apples" comparison.  In addition, the petitioner claims
that the Department misinterprets Article 2.4 of the Antidumping
Agreement to require only the deduction from the CEP price of costs
incurred between importation and resale.  The indirect expenses can
be categorized, the petitioner asserts, as "any other differences
which are also demonstrated to affect price comparability," as
required by Article 2.4.  Even if the Departments reading of Article
2.4 is correct, the petitioner maintains that the statute takes
precedence over GATT, citing Suramerica de Aleaciones Laminadas, C.A.
v. United States, 966 F.2d 660, 667-668 (Fed. Cir. 1992).  The
petitioner contends that to allow a deduction from the CEP of only
those indirect expenses incurred in the United States permits
respondents to avoid deduction of any selling expenses by shifting
U.S.-related selling activities offshore.  The petitioner also
maintains that the Department must interpret section 772(d) of the
Act according to its plain meaning, citing Mitsubishi Heavy
Industries, Ltd. v. United States, 15 F. Supp. 2d 807 (CIT 1998)
(Mitsubishi).  The CIT in Mitsubishi, the petitioner asserts, held
that the plain language of section 772(d) of the Act requires the
deduction, without limitation, of all expenses, including indirect
selling expenses, generally incurred in selling the subject
merchandise in the United States, regardless of where or when paid.

CEMEX and CDC respond that the Department is correct in not
deducting indirect selling expenses incurred in the home market from
the CEP calculations.  CEMEX and CDC state that the petitioner raised
the same argument unsuccessfully in the last three administrative
reviews.   CEMEX argues further that the petitioner attempts to
rewrite the legislative history of the URAA and argues that the
preamble to the Departments regulations addresses the petitioners
claim that the Departments regulations are inconsistent with the
statute.  CEMEX also points out that the NAFTA panel in the 94/95
review considered the issue raised by the petitioner and affirmed the
Departments treatment of the expenses in question.  CDC maintains
that it did not provide any activities directly related to U.S. sales
activity and that such activities were performed by its U.S.
subsidiary, RGPCC, only.  CDC refutes the petitioner's claim that
Mitsubishi compels the Department to deduct from the CEP expenses
incurred in the home market by a foreign producer and distinguishes
the facts in Mitsubishi from those in this case.  Moreover, CDC
believes that the courts remand in Mitsubishi reinforces the
Department's position to limit acceptable deductions from the CEP.

Departments Position:  The SAA at 823 states that the CEP shall be
reduced by certain expenses "associated with economic activities
occurring in the United States,..." (emphasis added).  The SAA at 823
also states that the CEP should be "calculated to be, as closely as
possible, a price corresponding to an export price between non-
affiliated exporters and importers."  The interpretation of both
statements in the SAA are codified at 19 CFR 351.402(b),  which
provides that we will make deductions to the CEP for expenses that
are associated with commercial activity in the United States that
relate to the sale to an unaffiliated purchaser, no matter where
incurred.  Consistent with section 772(d) of the Act, the SAA, and
section 351.402(b) of the regulations, we did not deduct the
respondents indirect selling expenses incurred in the country of
manufacture because we do not deem these expenses to be related to
commercial activity in the United States.  Rather, we deduct only
those expenses representing activities that relate to the sale made
to the unaffiliated customer and not those expenses, such as indirect
selling expenses incurred in the country of manufacture, that were
incurred in selling to the affiliated U.S. importer.  See
Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts
Thereof From France, et. al; Final Results of Antidumping Duty
Administrative Reviews, 64 FR 35590, 35619 (July 1, 1999), and Gray
Portland Cement and Clinker From Mexico; Final Results of Antidumping
Duty Administrative Review, 64 FR 13148, 13162 (March 17, 1999).

Furthermore, the petitioners argument with respect to Mitsubishi
is misplaced.  In that case, we deducted Mitsubishis indirect-
selling expenses incurred in Japan from U.S. price.  The CIT found,
however, that "indirect selling expenses must be associated with
economic activity occurring in the United States."  Consequently, the
CIT ruled that the Department "erred by deducting certain expenses
that were not so associated," referring specifically to the indirect
selling expenses incurred in Japan that the Department deducted from
U.S. price.  The CIT ordered the Department to remove Mitsubishis
indirect selling expenses that were included in the pool of expenses
deducted from U.S. price.  See Mitsubishi, 15 F. Supp. 2d at 819.
Accordingly, Mitsubishi provides additional support for our decision
not to deduct CEMEXs and CDCs indirect selling expenses incurred in
Mexico from CEP.

Comment 10:  The petitioner maintains that the Department neglected
to include indirect selling expenses incurred in the home market on
sales to the United States in "total U.S. expenses" for purposes of
calculating CEP profit under section 772(f) of the Act.  The
petitioner argues that including indirect selling expenses incurred
in the home market in calculating "total actual profit" but excluding
them from "total U.S. expenses" in determining the expense ratio
renders the calculation of CEP profit inconsistent.  The petitioner
argues that this contradictory treatment of the same expenses cannot
be reconciled with the statute, the SAA, Department practice, and
legislative history.  The petitioner also cites U.S. Steel Group v.
United States, 15 F. Supp. 2d 892 (CIT 1998) (U.S. Steel), wherein
the CIT rejected the Department's inconsistent treatment of movement
expenses in the calculation of the CEP.  The petitioner concludes
that, if indirect selling expenses incurred in Mexico are properly
attributable to U.S. sales for the purpose of calculating U.S.
selling expenses in the computation of "total actual profit," they
must be similarly attributable to U.S. sales for purposes of
calculating the expense ratio.  By including the indirect selling
expenses in question in the numerator of the expense ratio, the
petitioner maintains that the Department will ensure that the actual
profit and the expense ratio are calculated on the same basis.

The petitioner also argues that, in calculating the CEP-profit
allocation ratio, the Department included movement expenses
improperly in the calculation of total expenses.  Citing  U.S. Steel,
the petitioner contends that, for the purpose of consistency, if the
numerator in this ratio is calculated exclusive of movement expenses,
then the denominator should also be calculated exclusive of movement
expenses.  The petitioner argues that section 772(f)(2)(C) of the Act
requires the calculation of the denominator to be limited to the
production and sale of the merchandise.  Because movement expenses
are not related to the production or sale of merchandise, the
petitioner asserts, such expenses should be excluded from the CEP-
profit calculation.  The petitioner argues that, for the final
results, the Department should recalculate the profit-allocation
ratio by calculating the total expenses exclusive of movement
expenses.

CEMEX and CDC argue that the Department calculated "total U.S.
expenses" correctly in its "total expenses" calculation for CEP
profit.  CEMEX contends that the petitioner has not cited a
determination supporting its argument that the Department excluded
foreign indirect selling in "total U.S. expenses" incorrectly.  CEMEX
points out that this same issue was raised in the last three
administrative reviews and, for the same reasons, the Department
rejected the argument in each of those reviews.  CDC cites section
772(f) of the Act, stating that it directs the Department to exclude
foreign indirect selling expenses and foreign inventory carrying
costs associated with U.S. sales from its definition of total U.S.
expenses.  CDC cites to a number of recent determinations supporting
the Department's treatment of such expenses for purposes of
calculating the CEP profit in accordance with the Act.

With regard to the petitioner's argument that the Department
included movement expenses improperly in its calculation of total
expenses to use to calculate CEP, CEMEX and CDC respond that the
Department's calculation is a reasonable interpretation of section
772(f) of the Act and is consistent with the Department's past
practice.  CEMEX and CDC point out that the Department's Policy
Bulletin 97-1 enumerates its treatment of movement expenses in the
calculation of CEP profit.  The respondents argue that the CIT's
decision in U.S. Steel is not final and that the Department has not
indicated its intention to abandon its prior policy and adopt the
decision.  CDC notes that the Department is appealing the U.S. Steel
decision.

Department's Position:  We did not make an error by excluding U.S.
indirect selling expenses incurred in the country of manufacture from
the total U.S. expenses portion of the profit-ratio calculation.
Section 772(f)(2)(B) of the Act directs us to include in the
calculation of "total U.S. expenses" for purposes of calculating the
profit ratio only those expenses that would otherwise be deducted
under sections 772(d)(1) and (2) of the Act.  We did not find U.S.
indirect selling expenses incurred in the country of manufacture to
be associated with commercial activity in the United States, nor did
we find that such expenses pertain to the sale made to the
unaffiliated customer.  Accordingly, we must exclude the indirect
selling expenses incurred in the country of manufacture from the
numerator of the calculation of "total U.S. expenses" in the profit-
ratio calculation.  This approach is consistent with the intent of
the statute and with our practice.

With regard to U.S. Steel, we disagree with the CIT's holding with
respect to this issue.

The decision in U.S. Steel is not final and conclusive as the case
is on appeal.  Notwithstanding that fact, the SAA explains, at 824,
that section 772(d)(3) of the Act refers to profit allocable to
"selling, distribution, and further manufacturing" activities in
connection with the affiliate's U.S. sale.  Excluding movement
expenses from "total expenses" would discount the proportionality
incorrectly that must logically exist between the "total expenses"
calculated and the profits attributable to those expenses, when those
profits are based on expenses that include movement.  Moreover, such
an exclusion does not achieve the statutory purpose of removing the
profits associated with all aspects of the affiliate's sale in the
United States.  Accordingly, for purposes of the final results, we
have included movement expenses in "total expenses" for the CEP-
profit calculation.


6.  Regional Assessment

Comment 11:  CEMEX and CDC argue that the United States has not
honored its obligations under Article 4.2 of the WTO Antidumping
Agreement and its predecessor, Article 4.2 of the 1979 Tokyo Round
Antidumping Code.  CEMEX and CDC claim that the Department has not
implemented the special antidumping duty assessment requirements for
regional-industry cases set forth in Article 4.2 adequately because
it has imposed antidumping duties on all imports of subject
merchandise, including those consigned for consumption outside the
Southern Tier region, as defined by the International Trade
Commission (ITC) in the original investigation.  CDC also asserts
that the Departments implementation has been inadequate and belated.
It contends that the Department should either terminate this review
and revoke the antidumping duty order or should assess antidumping
duties only on CDCs entries of merchandise consumed within the
Southern Tier region.  CEMEX requests that the Department assess
duties and establish cash deposits only on its future entries
consumed within the Southern Tier region.

CEMEX and CDC argue that the United States is obliged to comply
with Article 4.2 of the Antidumping Agreement, which states:
"When the industry has been interpreted as referring to the
producers in a certain area, i.e., a market as defined in
paragraph1(ii), anti-dumping duties shall be levied only on the
product in question consigned for final consumption to that area.
When the constitutional law of the importing country does not permit
the levying of anti-dumping duties on such a basis, the importing
Member may levy the anti-dumping duties without limitation only if
(a) the exporters shall have been given an opportunity to cease
exporting at dumped prices to the area concerned or otherwise give
assurances pursuant to Article 8 of this Agreement, and adequate
assurances in this regard have not been promptly given, and (b) such
duties cannot be levied only on products of specific producers which
supply the area in question."

According to CEMEX and CDC, Article 4.2 compels the Department to
refrain from assessing duties on its subject merchandise destined for
consumption outside the Southern Tier region.  CDC contends that the
exception to Article 4.2 (when the constitutional law of the
importing country does not permit levying of antidumping duties on a
regional basis) does not apply because none of the conditions
necessary to justify an exception to Article 4.2 are satisfied in
this case.  First, both CEMEX and CDC assert that there is no U.S.
constitutional prohibition against levying antidumping duties on a
regional basis.  CEMEX and CDC contend that neither the port-
preference clause of the Constitution, which prohibits Congress from
regulating commerce or revenue of ports in a discriminatory manner
that would confer preferential treatment for the ports of one state
over the ports of another state, nor the uniformity clause, which
requires the uniform imposition of taxes throughout the United
States, render the regional assessment of antidumping duties
unconstitutional, citing U.S. Const. Art. I, Sec. 9, cl. 6, and Art.
I, Sec. 8, cl. 1.  CDC argues further that the United States has
never explained its theory that implementing the general assessment
rule would result in a constitutional violation.

Second, CDC argues that the condition by which the Department would
be exempted from assessing antidumping duties regionally provided it
affords the exporter an opportunity to enter into a suspension
agreement has not been met.  CDC argues that the Department did not
permit CDC to enter into a suspension agreement at the time of the
original investigation because, at the time of the investigation, the
Department's policy was one of refusal to enter into suspension
agreements.  Moreover, CDC maintains, the Department's decision to
collapse CEMEX and CDC in the original investigation diminished CDC's
opportunity further to enter into a suspension agreement.  CDC also
argues that the U.S. implementation of the Article 4.2 assessment
rules included no provisions by which these rules could apply to
orders predating the URAA.

Third, CDC argues that the condition that duties cannot be levied
only on products of specific producers which supply the area in
question has not been met.  It maintains that the language of Section
218 of the URAA and the Department's regulations demonstrate that
assessment on less than a national basis is possible.  CDC contends
that the fact that Congress enacted Section 218 with language calling
for the regional assessment of duties attests to the absence of a
U.S. constitutional prohibition against regional assessment.  CDC
points out, however, that Section 218 falls short of implementing the
regional-industry rule because it does not address producers or
exporters which, like CDC, export merchandise both into and outside
the region.

In addition, CDC contends that, in the 96/97 review, the Department
avoided the substantive regional-assessment issue CDC had raised
because the Department did not address and could not demonstrate a
constitutional bar prohibiting assessment of duties on a regional
basis.  CDC points out that the Department indicated that no
inconsistency exists between the U.S. antidumping law and GATT.  CDC
maintains that, if this holds true, the Department must yield to
Article 4.2 which states clearly that antidumping duties may be
assessed only on products imported for consumption in the relevant,
or Southern Tier, region.  Accordingly, CDC argues, the Department
should assign a zero margin to all sales made outside the Southern
Tier region.

The petitioner states that the Department has assessed antidumping
duties on all nationwide entries of the subject merchandise properly.
The petitioner contends that the respondents do not base their
argument upon either U.S. law or the Departments practice but rely
upon international trade agreements that have no direct legal effect
under U.S. law.  The petitioner cites the final results of the last
administrative review, where the Department explained that "its
determinations are governed by the U.S. antidumping statute,
specifically, Title VII of the Tariff Act of 1930, as amended by the
URAA in 1995."   Moreover, the petitioner adds, Congress has declared
that the collection of antidumping duties on a region-specific basis
is unconstitutional.  The petitioner discusses the statutory
provisions that provide for the assessment of antidumping duties in
regional-industry cases in a manner that is in accord with both the
constitutional constraints and U.S. international obligations.

In addition, the petitioner contends that, even if, for the sake of
argument, the international agreements cited by CEMEX and CDC were
applicable, they would not prevent the Department from assessing
antidumping duties on all entries of the subject merchandise.  The
petitioner notes that neither CEMEX nor CDC appealed the Departments
final affirmative determination to the appropriate court and within
the statutory time limit for appeals with respect to definition of
"industry" in a regional case or the Departments alleged failure to
offer an opportunity for a suspension agreement during the original
investigation.  Furthermore, the petitioner contends, the
international agreements the respondents cite refer only to the
assessment of duties and not to the collection of cash deposits.

The petitioner asserts that the arguments brought forward by CEMEX
and CDC are based on a fundamental misconception regarding the role
of international law, specifically the role that international
agreements play in the legal framework of the United States.  The
petitioner argues that it "is the implementing legislation, rather
than the agreement itself that is given effect as law in the United
States."

The petitioner also argues that CDCs reliance on Article 4.2 of
the Tokyo AD Code is misplaced because the Code was superceded by the
WTO AD Agreement.

The petitioner asserts that the Department must act within its
authority under sections 736(d)(1)-(2) and 734(m)(1)-(2) of the Act,
which were amended by the URAA to conform to the regional-industry
provisions of the antidumping agreement.  The petitioner contends
that these provisions are not applicable to respondents and thus
confer no authority upon the Department to refrain from assessing
antidumping duties outside the Southern Tier.  The petitioner argues
further that these sections of the Act only apply in investigations
and not reviews.  Also, the petitioner notes that both CEMEX and CDC
do not qualify for the regional assessment of duties under section
736(d)(2) of the Act because both respondents exported subject
merchandise into the Southern Tier during the original period of
investigation (POI).  The petitioner contends that the Department has
no obligation under sections 734(m)(1)-(2) of the Act to offer
respondents a suspension agreement because the Department may only
accept a suspension agreement during the pendency of an investigation
or within 60 days after the publication of the antidumping duty
order.  The petitioner notes that no respondent appealed the
Departments final determination in 1990 based on an alleged lack of
an opportunity for a suspension agreement.  For these reasons, the
petitioner concludes that the Department has complied fully with U.S.
law.

Departments Position:  As we have maintained in previous reviews,
our determinations in an antidumping proceeding are governed by the
U.S. antidumping statute - specifically, Title VII of the Tariff Act
of 1930, as amended by the URAA in 1995.  As numerous courts have
recognized, in the event of a conflict between a GATT obligation and
a statute, the statute must prevail.  See Federal Mogul Corp. v.
United States, 63 F.3d 1572, 1581 (Fed. Cir. 1995), citing
Suramerica.  Congress codified this principle in the URAA at section
102:  "[n]o provision of any of the Uruguay Round Agreements, nor the
application of any such provision to any person or circumstance, that
is inconsistent with any law of the United States shall have effect."
See also SAA at 659 ("The WTO will have no power to change U.S. law.
If there is a conflict between U.S. law and any of the Uruguay Round
agreements . . . U.S. law will take precedence.").  Thus, even if
respondents were correct in asserting that the statutory provisions
relating to regional assessment of duties conflicted with the
obligations contained in Article 4.2 of the Antidumping Agreement,
the Department must act in conformity with the antidumping statute.

Contrary to CDCs argument that we avoided the issue in the last
review, we emphasized in that review, as we do in this review, that
we must focus on the law governing determinations in antidumping
proceedings.  Section 736(d)(1) of the Act provides that, in an
investigation in which the ITC makes a regional-industry
determination, the Department "shall, to the maximum extent possible,
direct that duties be assessed only on the subject merchandise of the
specific exporters or producers that exported the subject merchandise
for sale in the region during the period of investigation."  Because
the original antidumping investigation on cement from Mexico occurred
in 1989-90 and the URAA applies only to investigations initiated on
the basis of petitions filed after January 1, 1995, this provision
does not apply to CEMEXs and CDCs exports.  However, even if
section 736(d)(1) of the Act did apply to this review, since CEMEX
and CDC exported subject merchandise into the region during the
original POI, the Department directed properly that antidumping
duties be assessed on all entries of merchandise produced by CEMEX
and CDC.

Moreover, section 736(d)(2) of the Act provides that, "after
publication of the antidumping order, if the administering authority
finds that a new exporter or producer is exporting the subject
merchandise for sale in the region concerned, the administering
authority shall direct that duties be assessed on the subject
merchandise of the new exporter or producer consistent with the
provisions of section 751(a)(2)(B)."  Because neither CEMEX nor CDC
is a new exporter or producer as described in this provision, section
751(a)(2)(B) of the Act is inapplicable to the assessment of
antidumping duties on subject merchandise exported to the United
States by CEMEX or CDC.

Furthermore, pursuant to section 734(m) of the Act, in an
investigation in which the ITC makes a regional-industry
determination, the Department "shall offer exporters of the subject
merchandise who account for substantially all exports of that
merchandise for sale in the region concerned the opportunity to enter
into [a suspension] agreement."  Any such agreement is "subject to
all the requirements imposed under this section for other
[suspension] agreements, except that if the Commission makes a
regional industry determination . .  in its final determination . . .
but not in the preliminary affirmative determination . . . any
agreement . . . may be accepted within 60 days after the antidumping
order is published under section 736."   Under section 734(b) of the
Act, we may only accept a suspension agreement during the pendency of
an investigation.  Because the Department cannot enter into a
suspension agreement once the 60-day post-order period has passed
(and, indeed, seven administrative reviews have passed), the
Departments decision not to offer respondents an opportunity to
enter into a suspension agreement in this review does not violate
section 734(m) of the Act.

Moreover, although CEMEX argues that the payment of cash deposits
should not be required on CEMEXs entries outside the Southern Tier,
the Act contains no provision and describes no circumstances under
which we may waive an importers requirement to pay cash deposits on
subject merchandise sold for consumption in the United States except
when conducting new-shipper reviews under section 751(a)(2)(3) of the
Act.  Accordingly, upon publication of these final results, we will
instruct the Customs Service to require the payment of cash deposits
and to assess antidumping duties on entries of CEMEXs and CDCs
subject merchandise that have entered or will enter for consumption
both inside and outside the Southern Tier.

As demonstrated above, the Departments decision to assess duties
on all subject merchandise exported to the United States by CEMEX and
CDC is consistent with the antidumping statute.  Indeed, neither
CEMEX nor CDC argue that the Departments actions do not conform to
these statutory provisions.  For purposes of this administrative
review, therefore, the Department need not consider respondents
arguments further concerning the United States implementation of its
obligations under the Antidumping Agreement.

Nonetheless, we disagree with the respondents contention that the
antidumping statute does not implement the United States obligations
under the Antidumping Agreement fully.  Because qualifying exporters
are given an opportunity for exemption from the assessment of
antidumping duties, the statutory scheme described above is
consistent with Article 4.2 of the Antidumping Agreement.  Thus, the
United States has implemented its obligations fully with respect to
the assessment of antidumping duties in regional-industry cases.

We also disagree with CDCs contention that we must terminate the
review and revoke the underlying antidumping duty order because U.S.
implementation of its international obligations is allegedly untimely
and inadequate.  First, as we have discussed in the "Revocation"
section of this document, we have no authority to revoke the order on
the basis of industry support at the time the petition was filed.
Moreover, neither CEMEX nor CDC appealed the Departments final
determination in the LTFV investigation based upon the Departments
alleged refusal to offer a suspension agreement to the exporters.
Thus, the antidumping duty order, based upon the final determinations
of the Department and the ITC, is final and binding.


7.  Bag vs. Bulk

    Comment 12:  CEMEX and CDC argue that the Department did not
make comparisons of the subject merchandise to the foreign like
product on a bulk-to-bulk and bag-to-bag basis, which resulted in
distortive and unfair comparisons of their sales of cement.  CDC
explains that, because it sells primarily bagged cement in the home
market which is sold at a higher price than the bulk cement that it
sells primarily in the United States, the antidumping margin is
inherently higher.  CEMEX and CDC contend that the mixed comparisons
of bagged and bulk cement are contrary to the statute as interpreted
by the NAFTA panel in the appeal of the 94/95 administrative review.
CDC points out that, while the Department determined in the 94/95
administrative review that bagged and bulk cement were similar in
accordance with section 771(16) of the Act, the NAFTA panel
determined that bagged and bulk cement were different from one
another.  CDC contends that the NAFTA panel required the Department
to make bag-to-bag and bulk-to-bulk comparisons because record
evidence demonstrated that bagged and bulk cement are sold to
distinct buyers for different uses commanding different prices and
such differences are not due only to packaging.  CDC asserts that, in
its supplemental questionnaire response for this review, it explained
that bagged cement is not the same merchandise as bulk cement owing
to the purposes for which it is used, the customers to which it is
sold, and, thus, the different prices for which it is sold.

CEMEX contends that bagged cement does not satisfy all of the
requirements under section 771(16)(B) of the Act to be deemed
comparable merchandise.  CEMEX contends that, while bagged cement was
produced in the same country by the same person as the subject
merchandise, sales of bagged cement do not satisfy the other two
subparts of the statute.

CEMEX argues that, with respect to section 771(16)(B)(ii) of the
Act, the component material of bagged and bulk cement and the
purposes for which bagged and bulk cement are used are not the same.
In this regard, CEMEX argues that the bag itself is a component
material that makes bagged cement, as it is sold, different from bulk
cement.  CEMEX also refutes the Departments claim that bagged and
bulk cement are similar because both cement types are used in the
production of concrete.  CEMEX asserts that the fact that both cement
types are used in the production of concrete is very general and does
not take into account the commercial realities of these cement types.
CEMEX argues that the inherent meaning of the phrase "purpose for
which it is used" in subpart (ii) of the statute is market-driven
and, thus, the Department must consider factors such as the physical
appearance, interchangeability, and channels of distribution of the
merchandise.

CEMEX points out that, in considering these market-driven factors,
sales of bagged cement in the home-market are made almost exclusively
to distributors for resale to small contractors or individuals for do-
it-yourself projects.  CEMEX also explains that, unlike bulk cement,
customers are willing to pay a premium for this bagged cement because
of the importance for ease of handling and usability of the cement.
In contrast, CEMEX states that sales of bulk cement in both the home
market and in the United States are made to end-user customers for
use in large projects.  CEMEX explains that, in order for customers
to handle the bulk cement, specialized facilities and equipment are
needed and this type of handling permits the customer to save money
by purchasing bulk cement at lower prices.

CEMEX and CDC argue further that, with respect to subpart (iii) of
the statute, bagged and bulk cement are not equal in commercial value
and they take issue with the Departments position that, because
there is no cost difference between these two cement types, except
for packaging, these cement types are approximately equal in
commercial value.  CEMEX contends that the antidumping statute does
not use the terms "cost of production" and "commercial value"
interchangeably.  Moreover, CEMEX and CDC argue that the term
"commercial value" refers to the price in the marketplace, not the
cost of production.  CEMEX asserts that record evidence indicates
that, even after adjusting for the cost of the bags, there remains a
significant difference in the prices of Type I bagged and bulk cement
which demonstrates that bagged and bulk cement are not approximately
equal in commercial value.  CDC explains that the price for each
cement type in the home and U.S. markets is different owing to brand-
name recognition of its bagged cement, differences in the markets in
which the bagged and bulk cement are sold, purchasing power of bulk
customers compared with customers of bagged cement, difference in
handling costs for each cement type, and the differences in packing
costs.

CDC contends that, if the Department compares the prices of bagged
and bulk cement on the basis that the only difference between these
cement types is product form (i.e., packaging), then its premise for
making such comparisons is contrary to recent determinations the
Department made in other cases.  CDC points to Stainless Steel Round
Wire from Taiwan, 64 FR 17336, 17339 (April 9, 1999) (SSRW from
Taiwan), and Stainless Steel Round Wire from Korea, 64 FR 17342,
17344 (April 9, 1999), to demonstrate that the Department does not
compare products sold in different product forms if two criteria are
met:  (1) the petitioner must provide evidence that, in the wire
industry, product form was a pricing consideration; (2) the
petitioner and the Department must identify a distinct correlation
between product form and pricing contained in the respondents
reported sales data.  CDC asserts that record evidence in the instant
review demonstrates that (1) in the cement industry, pricing for
bagged and bulk cement was different, and (2) that sales data
submitted for this review demonstrate that the prices of bagged and
bulk cement purchased by the same customers were different.
Therefore, CDC contends, the Department should not make unfair and
distortive comparisons of home-market sales of bagged cement to U.S.
sales of bulk cement because the product form is different between
these two cement types.

In addition, CEMEX disagrees that the record supports the
Departments continued practice of finding Type I bagged cement in
the home market comparable to bagged and bulk cement sold in the
United States.  CEMEX argues that the Department has not had a
continual practice of comparing bagged to bulk cement.  CEMEX
comments that, in the LTFV investigation and in the first four
reviews, the Department made bulk-to-bulk and bag-to-bag comparisons
in those reviews in which CEMEX sold bagged cement to the United
States.  CEMEX states that, while the Department compared subject
merchandise to the foreign like product which consisted of both bulk
and bagged cement in the 94/95 review, the NAFTA panel overturned the
comparison methodology employed in that review and limited the model
matching to a bulk-to-bulk comparison.  CEMEX asserts that such
comparisons were affirmed by the CIT with regard to the 91/92
administrative review.  CDC argues that the Departments decision in
this review to compare bagged cement to bulk cement is inconsistent
with the comparisons the Department made in other cement proceedings,
including the LTFV investigation involving gray portland cement and
clinker from Venezuela.  CEMEX and CDC argue, therefore, that the
Department has established a consistent practice of comparing cement
on bag-to-bag and bulk-to-bulk bases and should, for the final
results of review, follow the recent NAFTA panel decision concerning
the 94/95 administrative review.

The petitioner states that the Department found that bulk and
bagged cement are physically identical merchandise and that the only
difference between the two forms of presentation is the manner in
which the cement is packed.  The petitioner argues that there is no
basis for the use of form of presentation as a matching criterion.
The petitioner asserts that, although CEMEX is urging the Department
to follow the recent NAFTA panel decision concerning the 94/95
review, the panels decision is not binding, is not precedent, and is
not persuasive.  The petitioner argues that, for the current review,
CEMEX has not provided the Department with any evidence to warrant
departing from its established practice of matching U.S. transactions
with home-market transactions without regard to form of presentation.

Furthermore, the petitioner comments that CDCs argument concerning
bag-to-bag and bulk-to-bulk comparisons is not supported by any
evidence to warrant departing from the Departments established
practice.  The petitioner discusses several reasons:  there is no
statutory basis for excluding a portion of the home-market sales of
Type I cement from the foreign like product; CEMEXs arguments
against matching bulk and bagged cement are both legally and
factually erroneous; CDCs arguments against matching bulk and bagged
cement are both legally and factually erroneous.  Therefore, the
petitioner urges the Department to maintain its position in the
preliminary results with respect to this issue.

Departments Position:  As we stated in the preliminary results, we
find that matching the U.S. merchandise which is sold only in bulk to
the foreign like product sold in both bulk and bags is appropriate.
The cement types the respondents sold in the United States during the
instant review period were Type V LA and Type II.  CEMEX and CDC sold
Type I, Type II LA, Type V LA, Type II, and pozzolanic cement in
Mexico.  For the reasons discussed in the preliminary results, we did
not use home-market sales of Type V LA, Type II LA, Type II, and
pozzolanic cement as comparators to sales of subject merchandise.
Having rejected sales of Type V LA and Type II as comparators to the
sales of subject merchandise, we no longer had a basis to match the
subject merchandise to identical sales of the foreign like product.
In accordance with section 771(16)(B) of the Act, we matched the
sales of subject merchandise to the entire universe of Type I sales,
including both bulk and bagged cement.

Section 771(16) of the Act is silent with regard to the methodology
we should develop for purposes of matching the subject merchandise to
the foreign like product.  Moreover, Congress, the courts, and even
Chapter 19 panels have granted us broad discretion in developing our
model-match methodology.  See Kerr-McGee Chemical Corp. v. United
States, 741 F. Supp. 947, 951-52 (CIT 1990), and Certain Cut-to-
Length Carbon Steel Plate from Canada, USA-93-194-04, Opinion at 12
et seq. (October 31, 1994) ("Commerce has discretion in the
establishment of a product characteristic hierarchy as an aid in its
selection of product matches.").  In Koyo Seiko Co., Ltd. v. United
States, 66 F.3d 1204, 1209 (Fed. Cir. 1994), the Federal Circuit
acknowledged that "Congress has implicitly delegated authority to
Commerce to determine and apply a model-match methodology necessary
to yield such or similar merchandise under the statute."  For the
reasons discussed below, we believe that comparing sales of bulk
cement with sales of bagged and bulk cement is reasonable, consistent
with the statute, and supported by administrative practice.

The Department has a longstanding practice of developing a model-
match methodology in the early stages of each proceeding.  In this
respect, the Department, in consultation with the parties, selects
commercially relevant product characteristics that dictate the
selection of a foreign like product.  Thus, one may presume that
products which are selected based on the model-match criteria meet
the statutory elements of section 771(16)(B) of the Act which
includes physical characteristics, purposes, and commercial value.
For example, in Pasta From Italy, the Department determined that
"wheat quality" was an appropriate physical characteristic to be
included in the Departments model-match methodology because these
quality differences were "reflected in . . . costs and pasta prices"
and were, therefore, "commercially significant."  Certain Pasta From
Italy, Final Determination of Sales at LTFV, 61 FR 30326, 30346 (June
14, 1996).

Since the LTFV investigation in this case, the Department has
selected the foreign like product based upon ASTM specifications
because all parties have acknowledged the commercial significance of
these specifications.  In the LTFV investigation, the Department
indicated that "both petitioner and CEMEX have noted that customers
and producers in both markets rely on ASTM standards to differentiate
between products."   See Gray Portland Cement and Clinker from
Mexico, 55 FR 29244, 29247 (July 18, 1990).

Record evidence in this review reflects the fact that the physical
differences between Types I, II LA, and V LA affect the purposes for
which these cement types can be used.  For example, one CEMEX
official stated that "the ultimate customer tells the company that it
wants Type V LA cement or Type II LA cement used for specific
applications."  See pages 3-4, Attachment A, of CEMEXs submission
dated January 19, 1999.  These differences in the physical
characteristics of cement produced to different specifications as
well as the different applications for which these cement types may
be used also affect the commercial value of cement produced as Type
I, Type II LA, or Type V LA.  Furthermore, adjusting for these
differences is consistent with our methodology for recognizing that
cost differences (i.e., additives such as kaolin) affect the physical
make-up of the product and, thus, the ASTM specifications.
Consequently, these cost differences ultimately result in price
differences between the different cement types.  Indeed, CEMEX notes
that there are "...traditional price premiums for these cements
[Types V LA and II LA] compared to Type I."  Id. at 4.  Therefore,
based upon this record evidence, it is apparent that cement types
produced to different ASTM specifications are physically different,
used for different purposes, and have different commercial values.

We disagree with CEMEXs assertion that the bag itself is a
component material which differentiates bagged cement from bulk
cement.  Section 771(16)(B) of the Act requires, at a minimum, that
the foreign like product be similar "in component material or
materials".  The statute does not contemplate presentation type.  The
presentation or packaging of the merchandise merely dictates the form
in which the merchandise is sold (e.g., wrapped or sealed).  It does
not affect the constitution or component material of the product in
question.  Thus, the packaging of merchandise does not alter the
material components of the merchandise.  Interpreting the statute to
allow for packaging (i.e., bags, plastic, etc.) to alter the
composition of the merchandise may provide the respondent an
opportunity to manipulate the matching of products and, consequently,
the outcome of our review.  While there have been instances in which
the Department compared bag-to-bag and bulk-to-bulk cement, there is
also case precedent which supports our methodology to consider both
bulk and bagged cement as the foreign like product.  See Japanese
Cement, 60 FR 43763 (August 23, 1995).  Similarly, we do not find
that the cases CDC cites are persuasive.  In SSRW from Taiwan, for
example, the Department did not compare merchandise based upon
packing form and, therefore, CDCs cite to SSRW from Japan does not
reflect a Department practice which would compel the Department in
this case to exclude home-market sales of bagged cement from the
price comparisons.  In the instant case, similar to the facts in SSRW
from Taiwan, there is no indication that the packing form of cement
affects the commercial value of the merchandise.  As described above,
the commercial value, as reflected in cost variances and prices, is
dictated by the ASTM specification of the cement and not necessarily
the manner or form in which the cement is delivered to the customer.
In addition, case precedent supports our methodology to include both
bulk and bagged cement as the foreign like product.  See Gray
Portland Cement and Clinker from Japan, Final Results of
Determination, during Administrative Review, 60 FR 43761, 43763
(August 23, 1995).

We also disagree with CEMEXs argument that bulk and bagged
cement are different in the "purposes for which it is used."  Section
771(16)(B)(ii) of the Act states that the merchandise must be "like"
that merchandise in the purposes for which it is used.  In this
context, the statute requires that the merchandise have like or
similar purposes for which the merchandise sold in the United States
is used.  Bulk and bagged cement are used to produce concrete in both
markets.  Therefore, cement sold in both forms will be used for
similar or "like" purposes.  While CEMEX refutes our finding that
bulk and bagged cement are used in the production of concrete and
argues that this statement in the preliminary results of review is
too general, its argument is not compelling because this subsection
of the statute provides us some discretion in identifying merchandise
on the basis of component materials and purposes for which the
merchandise is used.

In its case brief, CEMEX and CDC take issue with our statement in
the preliminary results where we indicated that, in addition to other
elements that satisfy section 771(16)(B) of the Act, we found no cost
difference between bulk and bagged cement and, therefore, concluded
that bulk and bagged Type I cement are approximately equal in
commercial value.  We find that CEMEX's argument that equates
commercial value with price is not compelling.  The statute does not
define "commercial value," nor does it require that commercial value
be based upon price.  The price or price variance of merchandise is
not necessarily indicative, nor the sole determinant, of commercial
value.  Indeed, we have used cost information previously in
determining what is approximately equal in commercial value.  See
Tapered Roller Bearings, Four Inches or Less in Outside Diameter, and
Components Thereof, From Japan; Final Results of Antidumping Duty
Administrative Reviews, 63 FR 2558, 2574 (January 15, 1998).
Furthermore, neither the price variance of bulk and bagged cement nor
the presentation of cement to which CEMEX refers is related to these
physical differences and purposes for which the cement is used that
we consider relevant to the selection of similar merchandise pursuant
to section 771(16)(B) of the Act.  Consequently, unlike cement that
is produced to different ASTM specifications, we do not find that the
commercial value of one cement type (i.e., Type I) varies based upon
the manner in which cement is packaged or deliverd.

We conclude that the selection of all Type I cement as similar
merchandise is consistent with section 771(16)(B) of the Act for the
following reasons:  Type I cement sold in both bulk and bags is
produced in the same country, Mexico, and by the same person, CEMEX
and CDC (collectively, "CEMEX"), as that of the subject merchandise;
Type I cement, whether sold in bulk or in bags, is "like" the subject
merchandise in "component materials" and in the purposes for which it
is used; Type I cement, whether sold in bulk or in bags, is
approximately equal in commercial value to Type V LA and Type II
cement sold in the United States.  Further, case precedent supports
our methodology to compare bulk and/or bagged cement sold in the
United States to both bulk and/or bagged cement sold in the home
market.  See Calcium Aluminate Cement Clinker and Flux from France,
59 FR 14136, 14143-44 (March 25, 1994), Gray Portland Cement and
Clinker from Venezuela, 56 FR 56391 (November 21, 1991), and  Frozen
Concentrated Orange Juice from Brazil, 57 FR 3995 (February 3, 1992).

Finally, we believe CEMEXs and CDCs reliance on the NAFTA panels
decision regarding the 94/95 administrative review which reversed our
decision on the bulk/bag issue is misplaced.  As the NAFTA makes
clear, panel decisions do not have precedential effect since each
decision is  "limited to the particular matter between the particular
parties before the Panel."  See NAFTA Article 1904(9).  Also, in this
case, as of the time of issuance of these final results, the time to
appeal the decision for Extraordinary Challenge Committee review has
not ended.


8.  Difference-in-Merchandise Calculation

Comment 13:  The petitioner argues that the Department should base
CEMEXs difference-in-merchandise ("DIFMER") adjustment on adverse
facts available.  The petitioner claims that, despite the
Departments repeated requests for information, CEMEX has not
provided information to justify a DIFMER adjustment by isolating and
quantifying the variable cost differences.  As additional support for
the use of adverse facts available, the petitioner states that CEMEX
did not reveal until the cost verification that it had not provided
accurate cost data for the raw material kaolin, which is the basis
for CEMEXs claimed DIFMER calculation.

Further, the petitioner contends that CEMEXs claim that DIFMER
should be based on the methodology of using the processing cost of
one plant and the raw-materials costs of three plants is
inappropriate.  The petitioner claims that the only purpose for
weight-averaging the cost of the three plants is to lower the DIFMER
adjustment by reducing the effect of the high kaolin cost which is
only incurred at one plant.  In addition, the petitioner argues that
the DIFMER adjustment should not be based solely on the Hidalgo
plants kaolin cost.  According to the petitioner, the record
establishes that there are cost differences associated with
differences in the physical characteristics for Type I and Type V LA
cement other than kaolin costs.  Specifically, the petitioner
comments that the cost verification report indicates that the raw
material mix differs with the production of each type of cement.  In
addition, the petitioner asserts that an affidavit on the record
supports its position that grinding times for each type of cement
differs, such that more electricity is consumed when producing Type V
LA than when producing Type I.  Finally, the petitioner asserts
that, if the Department bases the DIFMER adjustment on the difference
in the variable costs of producing Type I and Type V LA at the
Hidalgo plant, the adjustment should reflect the actual cost of
kaolin used in producing Type V LA cement.

CEMEX responds that, in calculating the DIFMER adjustment, the
Department should average the material cost differences (i.e., kaolin
costs) at the Hidalgo plant with the material cost differences at the
Yaqui and Campana plants, the other CEMEX plants that produce Type V
LA cement.  It maintains that such an approach reflects the cost
differences between producing the cement sold in the U.S. market and
the home market.  Alternatively, CEMEX argues that, if the Department
does not average the differences in cost at the three plants, the
Department should limit the DIFMER calculation to the cost
differences between Type I and Type V LA cement produced at its
Hidalgo plant, the only plant that produced both Type I and Type V LA
cement during the instant review period.  CEMEX comments that it was
able to segregate the cost differences attributable to the physical
characteristics between the cement produced as Type I and Type V LA
at its Hidalgo plant from those attributable to plant efficiencies.
CEMEX asserts that both types of cement were processed in the same
production kiln and final grinding equipment.  CEMEX claims that it
maintained detailed production statistics for the Hidalgo plant which
identify all cost differences between Type I and Type V LA cement.
CEMEX points out that the Department verified the accuracy of the
Hidalgo plants production records and variable cost differences
without exception.  CEMEX asserts that, if the Department bases
DIFMER on the costs differences attributable to Type I and Type V LA
cement produced at the Hidalgo plant, then the Department should use
the verified cost information to calculate a DIFMER adjustment.

CEMEX argues that in this review it produced Type I and Type V LA
cement in commercial quantities at its Hidalgo plant and, as such,
was able to segregate the cost differences attributable to the
physical characteristics between the cement types from those
attributable to plant efficiencies.  CEMEX asserts that both types of
cement were processed in the same production kiln and final grinding
equipment.  CEMEX claims that it maintained detailed production
statistics for the Hidalgo plant which identify all cost differences
between Type I and Type V LA cement.  CEMEX points out that the
Department verified the accuracy of the Hidalgo plants production
records and variable cost differences without exception.  CEMEX
asserts that the Department should use the verified cost information
to calculate a DIFMER adjustment and not rely upon facts available.

CEMEX asserts that it has demonstrated during this review that, at
the Hidalgo plant where it produced Type I and Type V LA in
commercial quantities, the only cost difference between Type I and
Type V LA cement results from a difference in materials.  While the
clay quarried at Hidalgo produces a natural Type I cement, in order
to produce Type V LA cement, CEMEX explains, it uses a special clay
additive called kaolin to correct the clay mix which is not necessary
for the production of Type V LA cement at the Yaqui and Campana
plants.  Further, CEMEX maintains that the production records at the
Hidalgo plant demonstrate that there is no difference in the variable
processing cost of Type I and Type V LA and that the Department
verified the accuracy of the information.  In CEMEXs view, it
demonstrated at the Hidalgo plant verification that measuring the
cost for the two primary cement processes of heating the raw-
material mix in the kiln and final grinding of the clinker results in
an inconsistent pattern of small differences which does not justify
an adjustment.  CEMEX also contends that a DIFMER adjustment for
final grinding is unwarranted because the record shows that the
Hidalgo plant produces Type I and Type V LA cement to the same blaine
fineness.

With respect to the petitioners argument that there are additional
material cost differences other than kaolin, which arise in the
production of different types of cement due to the percentage of
material used, CEMEX contends that all the material inputs, with the
exception of kaolin and iron oxide, are extracted from the Hidalgo
quarry.  As such, CEMEX asserts, all the extracted raw materials have
the same per-unit cost per ton and the petitioners argument that a
DIFMER adjustment persists because of the percentage differences in
raw-material inputs is unsupported.
 In addition, CEMEX argues that the petitioners assertion that
adverse facts available should be used due to CEMEXs reporting of an
incorrect cost for kaolin and revealed on an untimely basis is
misplaced.  CEMEX comments that the minor correction for the cost of
kaolin, which it  presented on the first day of verification,
occurred because the transportation cost from the unaffiliated
supplier was excluded inadvertently from the transfer price that the
Monterrey plant charged the Hidalgo plant.  Thus, CEMEX claims, it
was in full compliance with the Departments procedures for
submitting minor errors found prior to verification.

Departments Position:  Section 773(a)(6)(C)(ii) of the Act
requires us to account for and adjust for any differences
attributable to physical differences between merchandise exported to
the United States and the merchandise sold in the home market where
similar products are compared.  Section 351.411(b) of the regulations
directs us to consider differences in variable costs associated with
the physical differences in the merchandise.  In this case, during
the POR, CEMEX sold Type I cement in the home market and Type V LA
cement to the United States.  We determined that there are
differences in the physical characteristics of cement produced as
Type I and Type V LA and, therefore, find that a DIFMER adjustment is
appropriate.  Accordingly, we must determine the variable cost-of-
manufacturing (VCOM) differences attributable to the differences in
the physical characteristics of Type I and Type V LA cement.  As
stated in the SAA at 828, "Commerce will not make an adjustment under
this section for cost differences attributable to: (1) the fact that
the exporter is charged different prices for its inputs depending on
the destination of the finished product; or (2) the fact that the
domestic and exported products are produced in different facilities
with differing production efficiencies."  Further, Import
Administrations Policy Bulletin Number 92.2 (July 29, 1992) states
that "it is important in any consideration of a DIFMER to isolate the
costs attributable to the difference, not just assume that all cost
of production differences are caused by the physical differences.
When it is impossible to isolate the cost differences, we should at
least determine that conditions unrelated to the physical difference
are not the source of the cost differences, such as when different
facilities are used...."

  In this case, CEMEX has numerous facilities which produced cement
during the POR.  With the exception of one plant, its Hidalgo
facility, these facilities produced either Type I or Type V LA
cement, not both.  As a result, we do not consider it appropriate to
simply weight- average the VCOMs for each type of cement across
plants because of the varying plant efficiencies.  That is, by simply
averaging the VCOMs for cement produced at the Yaqui, Campana, and
Hidalgo plants, we would be computing a DIFMER which is partially the
result of differing plant efficiencies.  In order to isolate variable
cost differences due strictly to the differences in the physical
characteristics between the two cement types being compared, we
focused on production costs incurred at the Hidalgo plant because it
produced commercial quantities of both Type I and Type V LA cement
during the POR.  At verification, we found that the only measurable
cost difference attributable to the physical differences between Type
I and Type V LA cement was the cost of the raw material input,
kaolin.  Although we found small, inconsistent processing cost
differences in the production of both types of cement at the Hidalgo
plant, those differences were not due to the differences in the
physical characteristics of the two cement types.  Rather, the
differences were a result of timing differences in the production
process (e.g., because the outside temperature has an impact on
energy consumption or energy costs may differ depending on which
month of the year production occurred).

Given the fact that, in the instant review, we were able to isolate
the cost differences attributable to the physical differences between
Type I and Type V LA cement at the Hidalgo plant, we have calculated
the DIFMER adjustment based on the corrected cost of kaolin incurred
by the Hidalgo plant which was included in the production of Type V
LA cement.  We did not find it necessary to apply facts available for
the purpose of calculating CEMEXs DIFMER because CEMEX produced Type
I and Type V LA cement at a single plant, Hidalgo.  This information
supports the calculation of a DIFMER adjustment to normal value for
CEMEX in the instant POR.

Comment 14:  The petitioner refers to the Departments exclusion of
certain months from CDC's DIFMER calculation because of "aberrational
factors" affecting the variable cost.  As such, the petitioner
maintains that, according to a worksheet in the cost verification
exhibits, in May, a month which the Department included in the
preliminary DIFMER calculation, CDC used Type V raw mix to produce
Type I clinker.  The petitioner contends that the use of Type V raw
mix in the production of Type I cement is aberrational and that the
inclusion of the May cost data distorts the DIFMER calculation.

CDC responds that the exhibit to which the petitioner refers to
demonstrates that the total costs for Type V raw mix was transferred
to the Type V clinker processing stage and resulted in an increase in
inventory for Type V clinker.  Thus, CDC contends, it did not use any
of the Type V raw mix to produce Type I cement and, accordingly, the
Department should include the May cost data in the DIFMER calculation.

Departments Position:  The cost verification exhibit indicates
that the total costs for the Type V raw mix were consumed in the
production of Type V clinker and not Type I clinker as the petitioner
alleges.  Thus, for these final results we have continued to include
the May cost data in the DIFMER calculation.  For further discussion
concerning our reasoning behind subtracting certain months in CDCs
DIFMER calculation, see the difference-in-merchandise memorandum,
dated August 31, 1999, p. 2.


9.  Sales-Below-Cost Test

Comment 15:  CEMEX and CDC assert that the Department excluded
certain below-cost sales from the calculation of normal value
erroneously.  CEMEX and CDC argue that, under the Departments
administrative precedent, below-cost sales will be disregarded only
if they exceed 20 percent of the total home-market sales volume.
CEMEX and CDC assert that, in its amended margin-calculation, the
Department found less than 20 percent of CEMEXs and CDCs home-
market sales below cost.  CEMEX and CDC argue that, in accordance
with the statute and Departmental precedent, no home-market sales
should have been disregarded.  CEMEX and CDC suggest that the
Department delete the reference to manufacturer in the sales-below-
cost test to correct this error.

Departments Position:  We agree with the respondents that we
should delete the reference to manufacturer in our sales-below-cost
test.  While we have not incorporated the respondents suggested
language, we have changed our calculations to ensure that we do not
take the manufacturer into account in our sales-below-cost test.
This is consistent with our approach to collapse the two entities and
treat them as one for margin-calculation purposes.  Having
disregarded the manufacturer in the cost test, we find that there
were no sales made at prices below the cost of production.


10.  Specialty Cement

Comment 16:  The petitioner contends that, during the cost
verification, CEMEX revealed for the first time that it had not
reported its production of an entire type of specialty cement.  The
petitioner asserts that, not only did CEMEX not report the production
of this product prior to verification, but even since then it has not
provided any information with respect to the product such as its
physical and chemical specifications.  The petitioner argues that it
is not uncommon for CEMEX to produce a cement meeting a particular
ASTM specification and label and sell it as a different cement type.
Furthermore, the petitioner asserts that CEMEX has not clarified
whether CEMEX included sales of the special cement in the home-market
sales  database it submitted for the instant review, and, if so, how
it reported the sales (i.e., as Type I, Type II LA, or Type V LA) and
how they can be identified in the home-market database.  Without this
basic information, the petitioner asserts that the Department cannot
evaluate how it should deal with sales of this product for purposes
of calculating the dumping margin and, therefore, the Department
should rely on adverse facts available.

In addition, the petitioner argues that the use of adverse facts
available is especially appropriate given CEMEXs prior record of
persistently misrepresenting the types of cement it produces at
particular plants.  The petitioner suggests that the Department
should, at the very least, apply partial adverse facts available and
use the highest normal value for any home-market sale made from one
of CEMEXs plants.

CEMEX rebuts the petitioners assertion that the existence of the
sales of special cement was disclosed only as a result of the
Departments cost verification.  CEMEX argues that this information
was included in the home-market sales verification and the cost
reconciliation submission submitted as part of CEMEXs supplemental
cost response.  Moreover, CEMEX argues that the total tonnage at
issue is very small when compared with the total production of cement
during the POR.  CEMEX comments that the Departments verifiers also
considered the quantity at issue to be insignificant and did not
pursue the inquiry further.

Department's Position:  During our verification of CEMEX's sales
responses, we examined the completeness and accuracy of CEMEX's
reported quantity and value of merchandise sold and found no
discrepancies.  Thus, we were satisfied that CEMEX reported the
universe of sales made during the review period accurately.  Even if
the existence of sales of CEMEX's special cement was raised prior to
the sales verification, our regulations, at 19 CFR 351.307(b) and
(d), provide us with significant flexibility in conducting
verifications by permitting the examination of a sample of expenses,
adjustments, and other topics that we consider relevant to factual
information submitted.  It is administratively impossible and
impractical to examine every topic at verification.  Furthermore,
verification is not intended to be an exhaustive examination of every
topic.  See Certain Internal-Combustion Industrial Forklift Trucks
From Japan; Final Results of Antidumping Duty Administrative Review,
62 FR 5592, 5602 (February 6, 1997).  We did not pursue this issue
further in the instant administrative review owing to the
insignificant quantity sold of this specialty cement.  For further
information concerning the tonnage sold of this cement, see the final
analysis memorandum from case analyst to file, dated March 6, 2000.
However, we do not believe that this topic should be disregarded in
its entirety and will pursue inquiry concerning CEMEX's special
cement in the 98/99 administrative review which we initiated on
October, 1999 (64 FR 53318).


11.  Assessment-Rate Calculation

Comment 17:  CDC argues that the Department should calculate
separate assessment rates for each importer.  CDC explains that,
because (1) it maintains separate facilities and employees from
CEMEX, (2) its importers do not share transactions, and (3) its
importers import different cement types, there is no reason to
warrant the Departments departure from past practice and calculate a
single importer-specific assessment rate.

Department's Position:  Our decision to calculate a single
assessment value stems from our decision to collapse both CEMEX and
CDC and treat them as a single entity for the purpose of this
administrative review.  Therefore, consistent with our decision to
treat CEMEX and CDC as a single entity we have calculated a single
weighted-average margin and, accordingly, one importer-specific
assessment value.  The assessment figure represents the actual duties
due and is the amount that we instruct the U.S. Customs Service to
use in collecting duties from importers, which is how we implement
our final results of review.

While CDC maintains that it has separate facilities and employees
from CEMEX and that it does not share transactions of imported
cement, these factors do not have any bearing on our decision to
treat these companies as a single entity, let alone our decision to
calculate a single importer-specific assessment rate.  As mentioned
in the collapsing memo, dated August 6, 1999, we find that CEMEX and
CDC satisfy the statutory definition of affiliated persons and meet
other criteria necessary to treat them as a single entity.
Therefore, our calculation of a single weighted-average margin and,
thus, a single importer-specific assessment rate for CEMEX and CDC is
consistent with our decision to collapse both companies for this
administrative review.   Calculating two assessment rates, one for
CEMEX and one for CDC, is inconsistent with our decision to treat
them as a single entity.

In addition, while CEMEX and CDC sold different cement types in the
United States, we have matched sales of cement sold in the United
States to sales of cement sold in Mexico, regardless of the cement
type and manufacturer.  Again, this is consistent with our decision
to collapse these two companies.

Finally, our decision to calculate a single importer-specific
assessment value in the instant administrative review was not
influenced by prior reviews of this order.  Rather, our decision was
based on and limited to the facts on the record in this
administrative review.  Indeed, because the statute is silent with
respect to the methodology by which we will calculate assessment
rates (see Federal Mogul Corp. v. United States, 918 F. Supp. 386,
404 (CIT 1996)), the application of a different methodology in this
review does not render our methodology inconsistent with the statute.


12.Adjustments

a. Rebates

Comment 18:  The petitioner argues that the Department should deny
CEMEXs claimed adjustment to normal value for rebates and discounts.
Citing SKF USA Inc. v. United States, 180 F.3d 1370, 1377 (Fed. Circ
1999) (SKF USA), and Torrington Co. v. United States, 818 F. Supp.
1563
(CIT 1993) (Torrington), the petitioner contends that CEMEX has not
met
its burden of demonstrating that its discounts and rebates do not
cover
non-scope merchandise.  The petitioner argues that CEMEX must to
demonstrate how it identified those adjustments that pertained to
multiple invoices and segregated adjustments paid on non-scope
merchandise.
It contends that, with respect to certain invoices examined at
verification,
CEMEX did not provide documentation identifying other invoices to
which
each rebate pertained.

The petitioner argues that many of CEMEXs large allocated rebates
were questionable as they exceeded the gross value of the invoice.
The petitioner claims that a number of CEMEXs large rebates were
either allocated incorrectly or were reported on a transaction-
specific basis when, in fact, such rebates pertained to numerous
invoices.  The petitioner maintains that CEMEXs distortive and
inaccurate reporting of its rebates is contrary to the Departments
regulations at 19 CFR 351.401(g)(1).  For these reasons, the
petitioner asserts that the Department should disallow all of CEMEXs
rebates.

CEMEX refutes the petitioners claim that the Department should not
deduct its discounts and rebates from normal value.  CEMEX states
that it provided detailed descriptive data of its discount and rebate
programs in its response and, with respect to its non-allocated
discounts and rebates, the record establishes that it calculated
these adjustments on a transaction-specific basis and limited them to
scope merchandise.  CEMEX points out that the invoices attributable
to sales on which these discounts and rebates were paid are limited
to a single cement type and presentation.

With respect to its allocated rebates, CEMEX argues that the
petitioners reliance upon SKF USA and Torrington is misplaced
because those rulings pertain to the Departments treatment of
circumstance-of-sale adjustments.  In contrast, CEMEX explains,
discounts and rebates are not synonymous with selling expenses and
are held to a different standard in accordance with 19 CFR 351.102.
CEMEX maintains that it allocated the rebates based on  customer,
cement type, presentation (bulk or bag), and calendar year and, thus,
the rebates were limited to scope merchandise.  CEMEX points out that
the Department verified CEMEXs allocation methodology which the
Department has accepted and used for the last three administrative
reviews.  CEMEX argues that the petitioner has not provided any
evidence lending support to its argument that adjustments that are
abnormally large should be disallowed.  CEMEX also refutes the
petitioners assertion that its allocated rebates are distortive.
While the allocated adjustments may yield results different from the
transaction-specific adjustments, CEMEX maintains there is no
requirement that the results of these types of adjustments duplicate
one another.  For the final results, CEMEX argues that the Department
should continue to grant its adjustments to normal value for all of
its reported discounts and rebates.

Departments Position:  We have allowed CEMEX's claimed rebate
adjustments because the data was submitted in accordance with our
accepted methodology for calculating rebates.  Section 351.401(g) of
the regulations states that allocations for price adjustments, such
as rebates, may be allowed provided the price adjustments are
calculated on as specific a basis as is feasible and provided the
respondent can demonstrate that the allocation method does not cause
inaccuracies or distortions.  At verification we found that CEMEX
allocated its reported rebates by presentation, cement type,
customer, company, and year.  See CEMEXs home-market verification
report from analysts to file dated July 23, 1999.  CEMEX reported
these rebates on as specific a basis as possible, given the manner in
which it maintained such rebate data in its computerized commercial
system database.  Generally, "we have accepted claims for discounts,
rebates, and other billing adjustments as direct adjustments to price
if we determined that the respondent, in reporting these adjustments,
acted to the best of its ability and that its reporting methodology
was not unreasonably distortive.''  See Antifriction Bearings (Other
than Tapered Roller Bearings) and Parts Thereof from France, et al.;
Final Results of Antidumping Duty Administrative Reviews, 62 FR 2081
(January 15, 1997).

 Furthermore, we allow adjustments to normal value for rebates if
we are satisfied that such rebates reflect the respondents normal
business practice and are not an attempt by the respondent to
eliminate dumping margins once we initiate an antidumping
investigation or review.  See Certain Corrosion-Resistant Carbon
Steel Flat Products From Japan, 63 FR 47465, 47468 (September 8,
1998).  In this respect, based on CEMEXs response and our
verification of this topic, we are satisfied that, in accordance with
19 CFR 351.401(g), CEMEX reported its rebates on as specific a basis
as was feasible given the manner in which it maintains its records in
the ordinary course of business and that its allocation methodology
is not unreasonably distortive.  Finally, the cases the petitioner
cites, including SKF USA, relate to the Departments practice prior
to changes made by the URAA and adoption of the Departments new
regulations.  Consistent with our 96/97 Review Final Results, we have
allowed adjustments for CEMEXs reported rebates.

b. Freight

Comment 19:  The petitioner contends that the Department should
deny CEMEXs reported home-market freight adjustment.  In the
alternative, the petitioner contends that the Department should use
partial facts available and limit CEMEXs freight deduction on
shipments from warehouse to customer to the smallest value reported
for each company.  The petitioner asserts that CEMEX did not
demonstrate adequately that it is entitled to the adjustment on home-
market sales.  The petitioner argues that CEMEX did not report its
home-market freight expenses on a transaction-specific, customer-
specific, or point-of-sale basis and has not demonstrated that it was
not feasible to report these expenses on such a basis.  The
petitioner also maintains that information the Department examined at
verification indicates that CEMEX could have provided freight
expenses on either a customer-specific or point-of-sale basis.

The petitioner argues that allocated movement expenses are
allowable under 19 CFR 351.401(g) only if the respondent can
demonstrate that it cannot report the expenses on a more specific
basis and amounts reported are not distortive of the actual amounts
incurred.  The petitioner points out that CEMEX determines its
freight expenses by the weight of the shipment and the distance the
cement was shipped.  The petitioner explains that, because freight
costs were reported on a per-ton basis, the costs do not take into
account the effect that shipping distance has on freight expenses.
The petitioner asserts that freight expenses incurred on merchandise
transported directly from the plant to the customer are much less
than those incurred on merchandise transported from the plant to the
terminal to the customer.  Combining these expenses, the petitioner
argues, results in distortive freight amounts.  In addition, the
petitioner argues that CEMEXs calculation methodology skewed the
arms-length test.  The petitioner asserts that, by reporting an
average freight cost, CEMEX can mask freight expenses incurred on
sales made to affiliated and unaffiliated customers and, thus, cause
sales to pass the arms-length test that would not be able to pass
otherwise.  The petitioner argues further that CEMEXs calculation of
average freight costs skewed the sales-below-cost test because the
average freight expenses understated actual freight expenses and,
thus, decreased the possibility of certain sales failing the cost
test.

CEMEX responds that the Department has accepted its reporting
methodology of the freight expenses in question for the last three
reviews.  CEMEX argues that, in accordance with 19 CFR 351.401(g)(3),
it reported this expense in as feasible a manner as its records
permitted.  CEMEX maintains that, owing to the high volume of sales
made during the POR, it would be burdensome to report transaction-
specific freight information.  While the allocated freight expenses
may yield results different from the transaction-specific adjustment,
CEMEX maintains there is no requirement that the results of these
types of adjustments duplicate one another, citing 19 CFR
351.401(g)(1).  CEMEX points out that it is the Departments
preference to use a weight-based rather than a value-based allocation
when expenses are incurred on the basis of weight.  Moreover, CEMEX
asserts that its freight calculation excluded non-scope merchandise.
CEMEX contends that it reduced the possibility of distortion by
calculating the freight expenses on the basis of cement type and
presentation (bulk or bagged cement) and by calculating monthly
factors, given that normal value is also calculated by month.

CEMEX refutes the petitioners argument that allocating the freight
expenses was distortive because of the difference in shipping
distances between the point of sale and the customer.  CEMEX observes
that the petitioner has raised this same argument in the last three
administrative reviews and the Department has rejected the
petitioners argument repeatedly, noting that differences in shipping
distances are not necessarily distortive.  Moreover, CEMEX points out
that the Department verified the reporting methodology of the freight
expenses and found no discrepancies.

Concerning the arms-length test, CEMEX indicates that it reported
freight expenses incurred by both affiliated and unaffiliated
shippers and an analysis of such data indicates that the methodology
does not affect the results.  Thus, CEMEX contends, the freight
expenses incurred by affiliated parties have no bearing on the
margin.  With respect to the sales-below-cost test, CEMEX maintains
that the petitioners theory is incorrect.  CEMEX explains that, in
conducting its own cost test, it increased the freight costs
conservatively by 500 percent which results in only 13 percent of
home-market sales failing the cost test, a percentage still far below
the Departments 20-percent threshold.  For these reasons, CEMEX
maintains that its reported freight expenses are not distortive and
the Department should continue to adjust normal value for freight
expenses CEMEX reported.

Department's Position:  Based on submissions from the respondent
and on our findings at verification, we determined that CEMEX's
reported freight costs for Type I cement are reported on as specific
a basis as is feasible, given CEMEX's accounting system.
Furthermore, CEMEXs calculation methodology provides a reasonable
estimate of actual transaction-specific freight expenses.  We
disagree with the petitioner's assertions that CEMEXs methodology
for reporting freight costs skews the arms-length test.  As the
petitioner argues, examination of specific sales may result in
differences between allocated and actual freight expenses.  However,
we determined during verification that combining freight expenses of
both affiliated and unaffiliated customers should have no more than a
marginal effect on the arms-length test.  We also disagree with the
petitioners assertion that CEMEXs freight expenses affect the
results of the sales-below-cost test adversely.  With regard to the
worksheet which the petitioner cites in its argument that CEMEXs
calculation methodology skewed the sales-below-cost test, the
worksheet is merely an example of freight cost incurred and excludes
other data submitted by CEMEX, including the data we examined during
verification.  The use of this worksheet does not provide a
compelling reason to support the petitioners assertion.  Thus, we
have accepted CEMEX's claimed adjustment and have deducted its home-
market freight expense for Type I cement from normal value for these
final results.

Comment 20:  The petitioner contends that the Department should
deny an adjustment to normal value for CDCs reported freight
expenses with respect to sales made by its affiliate, Construcentro.
The petitioner argues that, as stated in its questionnaire response,
for sales made by Construcentro, CDC reported an average freight
expense that included non-scope merchandise.  The petitioner argues
that a recent judicial ruling requires the Department to disallow an
expense that includes non-scope merchandise, citing SKF USA Inc. v.
United States, 180 F.3d 1370, 1377 (Fed. Cir. 1999) (SKF USA).

CDC argues that the Department deducted Construcentros home-market
inland-freight expense from normal value properly.  CDC argues that
its allocation is the most specific possible, given its accounting
system.  CDC claims further that, because the majority of its total
shipments were of subject cement, the freight expenses associated
with its shipments is not inherently distortive.  CDC observes that
the Department made an adjustment for this expense in the last three
administrative reviews where CDC used the same methodology.  CDC
asserts that the petitioners reliance upon SKF USA is misplaced
because that decision concerned billing adjustments and cash
discounts that are guided by rules concerning circumstance-of-sale
adjustments which are not applicable to the Departments treatment of
movement expenses.

Department's Position:  As in prior reviews, we find that CDC
reported its freight expenses to the best of its ability given its
accounting system.  The Department reviewed CDCs freight expenses
and calculation methodology as reported in CDCs June 1, 1999,
response and verified these expenses and its calculation methodology
without discrepancies.  See Home Market Sales Verification of
Cementos de Chihuahua in the 1997/1998 Antidumping Review of Gray
Portland Cement and Clinker from Mexico (August 6, 1999).  We are
satisfied that, consistent with 19 CFR 351.401(g), CDCs allocation
methodology does not cause inaccuracies or distortions.

With respect to the petitioners reliance on SKF USA, this case
relates to the Departments practice prior to changes made to URAA
and adoption of the Departments new regulations.  Since we found
that CDCs allocation methodology was reasonable, given the manner in
which the expense was incurred, the accounting records that it
maintains in its normal course of business, and the feasibility in
which it can report this expense, we have made an adjustment to
normal value for these freight expenses.

c. Advertising

Comment 21:  The petitioner contends that the Department treated
CEMEXs home-market advertising expense incorrectly as a direct,
rather than indirect, selling expense.  The petitioner argues that
the Departments treatment of this expense as direct in nature is
inconsistent with the Department practice and with the manner in
which the Department has classified CEMEXs home-market advertising
expense in prior reviews of this order.  The petitioner also argues
that CEMEX has not met its burden of establishing that its
advertising expense should be classified as a direct selling expense.
Specifically, the petitioner points out that, in order for this
expense to be classified as a direct selling expense, it should (a)
bear a direct relationship to the particular sale in question, (b) be
assumed on behalf of the customers customer, and (c) be associated
with sales of scope merchandise sold during the POR.  The petitioner
asserts that the expense in question does not meet any of these
criteria necessary to treat CEMEXs home-market advertising as a
direct selling expense.  The petitioner contends that record
evidence, including the verification report, demonstrates that this
expense is directed toward the general public, promotes CEMEXs
corporate image and the companys entire product line, and, thus,
does not meet any of the criteria described above.  The petitioner
argues that, absent record evidence that establishes that this
expense should be treated as a direct selling expense, the Department
must treat the expense in question as an indirect selling expense for
the final results of review.

CEMEX contends that its advertising expense is a direct selling
expense and the Departments treatment of this expense was
appropriate.  CEMEX argues that the advertising expense in question
was directed at its customers customer, end-users of the cement.
CEMEX points out that the Department verified this expense and noted
specifically in the verification report that this expense was
incurred on a product-specific basis for advertising aimed towards
end-users.  CEMEX posits that the treatment of this expense as
indirect in previous reviews does not necessarily deem the expense to
be indirect in the instant review as every review stands on its own.

Departments Position:  Section 351.410(d) of the regulations
states that direct selling expenses are those that incurred or
"assumed by the seller on behalf of the buyer...."  We stated in our
original questionnaire, at B-21, dated September 29, 1998, that the
cost of advertising is the cost that the respondent incurred to
advertise to its customer's customer.  In addition, the advertising
must be directed toward the specific product under investigation.
See Roller Chain, Other Than Bicycle, From Japan, Final Results of
Antidumping Duty Administrative Review, 58 FR 52264 (October 7,
1993).  At verification, we found that CEMEX's advertising was
product-specific and directed towards its customer's customers, end-
users.  See CEMEX's home-market verification report, at 14, dated
July 23, 1999.  We have considered such advertising expenses as
direct expenses previously.  See Notice of Final Results of
Antidumping Duty Adminsitrative Review, Certain Pasta From Italy, 65
FR 7349, 7359 (Feb. 14, 2000) (the Department treated home-market
advertising as a direct expense as it appeared to be targeted to
respondents customers customer).  Accordingly, we have treated
CEMEX's reported home-market advertising expenses as a direct selling
expense for these final results of review.

d.  Early-Payment Discounts

Comment 22:  The petitioner points out that, although CEMEXs and
CDCs questionnaire responses indicate that the reported early-
payment discounts were calculated by applying a discount percentage
against the invoice value of their sales, numerous transactions were
reported in excess of these amounts.  The petitioner contends that
the Department should deny granting an adjustment to normal value for
those early-payment discounts that exceed the maximum percentage
granted to customers as reported in the narrative portions of the
companies responses.

CDC agrees that its early-payment discounts should not exceed the
maximum percentage reported in its responses and states that only a
small number of its reported transactions exceeded this amount.
However, CDC suggests that some of the values of early-payment
discounts exceeding the maximum percentage may be due to rounding.
CDC argues that, because the Department verified this discount claim,
there is no reason to deny an adjustment for those early- payment
discounts that exceed the maximum discount percentage indicated in
its response.  Rather, CDC requests that the Department limit the
discount to three percent.

Departments Position:  We have not denied an adjustment to normal
value for those early-payment discounts that exceeded the maximum
percentage as reported in CEMEXs and CDCs responses.  While the
amounts reported were overstated in some instances, we have corrected
this where appropriate.  Accordingly, we have limited those early-
payment discounts that exceed the maximum percentage identified in
CEMEXs and CDCs responses to their respective maximum discount
percentages for these final results of review.

e.  Credit Expenses

Comment 23:  The petitioner argues that the Department should not
use publicly available Mexican Interbank Average Interest (TIIP) to
calculate CEMEXs short-term interest rate in the credit-expense
calculation.  The petitioner contends that a verification exhibit
demonstrates that CEMEX had short-term peso-denominated debt during
part of the POR and, accordingly, the Department should use the
weighted-average interest rate applicable to peso-denominated loans
for the final results of review.

CEMEX argues that it did not have any peso-denominated short-term
loans outstanding during the POR.  CEMEX points out that the interest
rate included in the verification exhibit to which the petitioner
refers represents the interest rate applicable to the current
maturity of long-term debt.  CEMEX states that, in the 94/95 and
95/96 reviews, the Department rejected the use of a short-term
interest rate applicable to the current portion of long-term debt in
the calculation of credit expense.  CEMEX asserts that the TIIP rate
is a more accurate reflection of the short-term borrowing rate in
Mexico and meets the criteria set forth in the Import Administration
Policy Bulletin 98.2 (February 23, 1998) in situations where the
respondent has no short-term borrowings during the POR.

Departments Position:  Although the verification exhibit to which
the petitioner refers  has positive amounts listed under a column
heading labeled "Short Term Debt", this does not demonstrate that
CEMEX had short-term borrowings outstanding during the POR.  Based on
CEMEX's records that we examined at verification, we found that CEMEX
did not have short-term debt outstanding during the review period and
that the loan amounts included in the verification exhibit represent
the current portion of long-term debt.  See memorandum from David
Dirstine to The File concerning addendum to CEMEX's home-market
verification of credit expenses, dated February 29, 2000, and CEMEX's
home-market verification report, dated July 23, 1999.

In accordance with our long-standing policy, when a respondent has
no short-term borrowings during the review period, "we will use
publicly available information to establish a short-term interest
rate..." and, thus, can "accept 'external' information about the cost
of borrowing in the relevant currency."  The available information
used to establish a surrogate interest rate should be reasonable,
readily obtainable, and representative of "usual commercial
behavior."  See Import Administration Policy Bulletin Number 98.2
(February 23, 1998).  We found that CEMEX's use of the TIIP rate in
the calculation of its home-market credit expenses meets these three
criteria.  We also found that, in the absence of short-term debt
during the instant review period, the TIIP is an appropriate
surrogate interest rate to use in CEMEX's home-market credit expense.

f.  Other Adjustments

Comment 24:  The petitioner contends that CDC is not entitled to a
post-sale price adjustment to normal value for the amounts it
reported in its Other Adjustments (OTHADJGH) field.  The petitioner
asserts that the field includes expenses that do not relate
specifically to merchandise under review.  The petitioner also
asserts that, with respect to one of the customers to which this
adjustment was granted, the price adjustment was indirect rather than
direct in nature because the quantity sold does not vary and this
adjustment was not related to a particular sale, citing Zenith Elecs.
Corp. v. United States, 77 F.3d 426, 431 (Fed. Cir. 1996), and
Torrington v. United States, 68 F.3d 1347, 1353 (Fed. Cir. 1995).
The petitioner also states that the sale related to the particular
customer type pertains to the downstream sale and. thus, this post-
sale price adjustment should be categorized as an indirect expense,
citing Antifriction Bearings (Other than Tapered Roller Bearings) and
Parts Thereof from France, et al.; Final Results of Antidumping Duty
Administrative Reviews, 62 FR 54043, 54054 (October 17, 1997).
   CDC contends that the Department made an adjustment to normal
value properly for the amounts reported in the OTHADJGH field.  CDC
asserts that the record demonstrates that this post-sale price
adjustment was granted on sales of scope merchandise.  CDC also
states that this discount pertained to sales made between CDC and its
ready-mix customers and does not pertain to downstream sales.  CDC
comments that the Department examined this discount at verification
and found no discrepancies with the manner in which it was reported.
For these reasons, CDC believes that, as in prior reviews of this
order, the Department should grant an adjustment to normal value for
the amounts reported in the OTHADJGH field.

Departments Position:  As a general matter, the Department only
accepts claims for other price adjustments as direct adjustments to
price if actual amounts are reported for each transaction.  Other
price adjustments based on allocations are not allowable as
adjustments to price unless they are based on a fixed and constant
percentage of sales price.  As demonstrated in CDCs responses, CDC
reported these adjustments on a transaction-specific basis.  For
example, CDC reported billing adjustments that corrected errors in
the invoice price or adjusted prices for certain customers when a
price change occurred or reported adjustment for unusual delivery
conditions such as when a customer incurred additional delivery
charges due to a difficult delivery location.  These examples
demonstrate that the adjustments were transaction-specific in nature.
Another of CDCs adjustments was calculated on a fixed-percentage
basis and was also product- and customer-specific.  As stated above
the Department allows price adjustments when they are granted as a
fixed and constant percentage of sales price on all transactions for
which they are reported.

The petitioners comments regarding a direct expense being an
expense which "does not vary with the quantity sold," "is related to
a particular sale," and is not based on "downstream sales" are
misplaced.  The issue is whether the adjustment is a post-sale
adjustment to price rather than whether it is a direct or indirect
expense.  The criteria the Department uses to distinguish between
direct and indirect expenses and adjustments to price are different.
The amounts reported in the other-adjustments field pertain to
adjustments to price, not expenses.   Moreover, we examined these
adjustments at verification and found no discrepancies.  Therefore,
consistent with our treatment of such adjustments in the last review,
we have allowed these adjustments.


13.  Financing Cash Deposits

Comment 25:  CDC disagrees with the Department decision to deny
CDCs adjustment to U.S. indirect selling expenses which CDC made to
offset the cost of financing antidumping cash deposits.  CDC argues
that the Department has been inconsistent with its practice of and
its reasons behind treating the cost of antidumping cash deposits as
selling expenses.  CDC points out that, since October 1997, the
Department has followed the practice of denying the offset for
antidumping cash deposits to its indirect selling expenses.  CDC
indicates that the CIT has upheld the position that the Department
may allow respondents an adjustment to their indirect selling
expenses and points to recent decisions made by the CIT with respect
to NTN Bearing Corp. of  America v. United States, Slip Op. 99-71 at
9 (CIT, July 29, 1999), and Timken Co. v. United States, Slip Op. 98-
92 at 6 (CIT, July 3, 1998).

The petitioner argues that the Department should continue to deny
CDCs request because there is no basis under the statute to grant
it.  The petitioner states that CDC does not explain how an item that
does not qualify as a U.S. indirect selling expense should
nevertheless form the basis for an adjustment under the statute.  It
argues that, if CDCs reported U.S. indirect selling expenses
included the claimed cash-deposit opportunity cost, then it is
conceivable that the Department should compensate the respondent by
making an upward adjustment to CEP.  However, the petitioner argues
that CDC has not brought forward any evidence that its reported U.S.
indirect selling expenses included the claimed cash deposit
opportunity cost.  The petitioner argues that CDCs imputed claimed
does not necessarily mean that it is included in the reported U.S.
indirect selling expenses as an actual cost.  The petitioner states
that, in the absence of evidence that the reported U.S. indirect
selling expenses were distorted in some way by cash deposits, the
Department made the correct decision to deny CDCs claim.

Departments Position:  We have not adjusted to CDC's U.S. indirect
selling expenses for imputed expenses which CDC claims are related to
financing of cash deposits.  The statute does not contain a precise
definition of what constitutes a selling expense.  Instead, Congress
has given the Department discretion in this area.  Current Department
practice does not treat antidumping financial expenses associated
with cash deposits as a direct, inevitable consequence of an
antidumping duty order.  Our denial of an adjustment to indirect
selling expenses for the financing of cash deposits is consistent
with our treatment of such expenses in the last two administrative
reviews of this order in addition to reviews of other orders.  See
Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts
Thereof from France, et al., 62 FR 54043, 54079 (October 17, 1997),
and Tapered Roller Bearings and Parts Thereof, Finished and
Unfinished, From Japan, and Tapered Roller Bearings, Four Inches or
Less in Outside Diameter, and Components Thereof, From Japan, 63 FR
63860, 63866-67 (November 17, 1998).  As our position is unchanged
from the two prior reviews, we adopt the discussion with respect to
this issue in our 95/96 Final Results, 63 FR at 1278.
14.Duty Absorption

Comment 26:  CEMEX contends that the Departments finding of duty
absorption is unreasonable and contrary to law.  CEMEX argues that
the Department never analyzed whether duty absorption exists, as
required by the URAA and the SAA.  Instead, CEMEX maintains, the
Department presumed duty absorption from the existence of a dumping
margin.  CEMEX argues further that the Departments standard of
allowing respondents to rebut the presumption of duty absorption by
demonstrating that the unaffiliated purchasers paid the dumping duty
is unreasonable because the Department has provided no guidance
regarding this standard.

CDC argues that it cannot provide an irrevocable agreement between
RGPCC and the first unaffiliated customer that demonstrates that
RGPCC did not absorb duties during the instant review period because
the Departments standard was developed after imports began entering
the United States.  CDC contends, however, that, based on information
the Department examined at verification, the record establishes that
RGPCC did not absorb duties during the instant review period.

The petitioner argues that CEMEX and CDC have no foundation for
objecting to the Departments duty-absorption determination.  The
petitioner maintains that the Departments determination is
consistent with its practice.  In addition, the petitioner asserts
that the Department found correctly that CEMEX and CDC provided no
evidence to rebut the presumption of duty absorption.  The petitioner
asserts that CEMEXs suggestion that the Departments duty-absorption
presumption is not possible to rebut is entirely unfounded.  The
petitioner states further that there is no evidence on the record to
indicate that CEMEX ever sought the Departments guidance or
attempted to rebut the Departments presumption.  The petitioner also
rebuts CDCs claim that the Department did not set a standard for
proving that duties are not absorbed by an importer until after
imports began entering the United States in the current
administrative review.  The petitioner argues that, like CEMEX, CDC
knew that the duty-absorption issue would arise in this review and it
had sufficient time and opportunity, prior to the initiation of the
review, to develop the evidence demonstrating that it did not absorb
duties.

Departments Position:  We disagree with the respondents that our
duty-absorption finding for the preliminary results of review was
erroneous.  Our final results of review indicate that both CEMEX and
CDC absorbed duties.  We made this determination in accordance with
our statute, regulations, and practice.  Section 751(a)(2)(A)(ii) of
the Act and 19 CFR 351.213(j) indicate that we will consider dumping
margins calculated during a review in determining whether duty
absorption exists.

As we explained in Antifrication Bearings (Other Than Tapered
Roller Bearings) and Parts Thereof From France, et al; Final Results
of Antidumping Duty Administrative Reviews and Partial Termination of
Administrative Reviews, 62 FR 54043, 54074 (October 17, 1997), the
"existence of a margin raises an initial presumption that the
respondent and its affiliated importer(s) are absorbing the duty."
This is a reasonable presumption because the continued existence of
dumping duties indicates that the producer and its affiliated U.S.
importer have not adjusted their prices to eliminate dumping.  If the
producer has not set its price to the first unaffiliated U.S.
customer high enough to eliminate dumping, it is reasonable to
presume that the producer is also absorbing the dumping duties.  The
reasonableness of this presumption is also reflected in the SAA at
885, which states that "the affiliated importer may choose to pay the
antidumping duty rather than eliminate the dumping..." (emphasis
added).  In sum, the existence of dumping is a reasonable presumption
that the affiliated importer is absorbing duties.

In addition, we disagree with CDCs argument that we examined
information at verification that establishes that its affiliated
importer did not absorb duties during the instant review period.  The
information in the exhibit to which CDC refer was an exhibit that we
used in the sales-trace portion of the verification and indicates the
profit earned on the sale of one transaction.  The exhibit does not
indicate, however, that the unaffiliated purchaser absorbed duties
nor is it representative of all sales made by the affiliated
importer.  Furthermore, we have articulated in numerous
administrative reviews that, in order to satisfy our standard, the
respondent must provide an irrevocable agreement between the
unaffiliated purchaser and the affiliated importer that demonstrates
that the unaffiliated purchaser will pay the antidumping duties.  The
verification exhibit does not satisfy this standard.  Therefore, in
accordance with the statute and regulations, we found that CEMEX and
CDC absorbed duties during the instant review period.


14.  PROMEXMA Sales

Comment 27:  CEMEX disagrees with the Departments inclusion of
sales made by PROMEXMA in the calculation of normal value.  CEMEX
argues that sales were made at a different levelof trade from the
levels of trade identified in the Departments level-of-trade
memorandum and maintains that the Departments level-of-trade
memorandum did not address such sales.  CEMEX argues that, if the
Department includes sales made by PROMEXMA in its calculation of
normal value, it must exclude sales made to PROMEXMA in order to
avoid double-counting them.

The petitioner asserts that, in this review, CEMEX has not provided
the Department with any new information regarding PROMEXMAs selling
functions to warrant the Departments departure from its
determination on this issue in the 95/96 review.  The petitioner
contends that, contrary to CEMEXs argument that PROMEXMA sales were
made at a different level of trade, the Department should, as it did
in the 95/96 review, determine that all of CEMEXs home-market sales
were at one level of trade.  The petitioner argues that the
Departments decision in this review was based, as it was in the
earlier review, on the fact that CEMEX did not establish that there
is a substantial difference between the selling functions undertaken
by CEMEX and those undertaken by PROMEXMA.  The petitioner also
argues that, even if CEMEX had demonstrated differences in home-
market levels of trade, CEMEX has not attempted to provide a legal
argument that such differences require the removal of PROMEXMAs
sales from the margin calculation.  The petitioner argues that the
statute merely requires that the Department attempt to compare U.S.
and comparison-market transactions at the same level of trade.  The
petitioner contends that, while CEMEX maintains that it does not have
a matching level of trade in the home market for PROMEXMA sales, it
cannot invoke this provision as a basis for excluding PROMEXMAs
sales.  Moreover, the petitioner argues that CEMEX has not cited any
legal authority for preferring one allegedly non-matching level of
trade to another allegedly non-matching level of trade.

Departments Position:  In accordance with section 351.403(d) of
the regulations, we do not calculate normal value based on the sale
through an affiliated party if sales of the foreign like product by
an exporter or producer to affiliated parties account for less than
five percent of the total quantity or value of the exporters or
producers sales of the foreign like product in the market in
question.  The sales CEMEX made to PROMEXMA account for less than
five percent of the total quantity of CEMEXs sales made in Mexico.
Accordingly, for these final results of review, we have excluded from
the margin calculation those sales made by PROMEXMA to unaffiliated
customers while retaining CEMEXs sales made to PROMEXMA.  Since we
have excluded from the margin calculation PROMEXMAs sales, CEMEXs
argument that such sales were at a different level of trade is moot.
Since PROMEXMA is an affiliated customer, we included all of the
reported sales CEMEX made to PROMEXMA in the arms-length test.  We
excluded from the margin calculation those sales made to PROMEXMA
that did not pass the arms-length test.


15.  Contrucentro Employee Sales

Comment 28:  CDC contends that the Department did not eliminate
employee sales of its affiliated reseller, Construcentro, for
purposes of calculating normal value.  CDC argues that, for the final
results of review, the Department should exclude such sales from the
calculation of normal value.

The petitioner agrees with CDC.

Department's Position:  We agree that we should have eliminated
Construcentros employee sales from the our calculations.  For these
final results of review, we have ensured that such sales are not part
of our calculation of normal value.
16.Further-Manufactured Sales

Comment 29:  CEMEX and CDC contend that, while they met the
Departments special rule for further-manufactured sales in
accordance with section 772(e) of the Act, the Department  excluded
information on further-manufactured sales from the assessment-rate
calculation.  CEMEX contends that this error resulted in an
overstatement of the per-ton assessment rate.  CDC requests that the
Department include in its assessment-rate calculation sales of RGMs
further-manufactured cement that it sold to unaffiliated customers
during the review period.  CEMEX requests that the Department include
all of its further-manufactured sales in the assessment-rate
calculation and provides suggested methodology for the Departments
calculations.

The petitioner agrees with both CEMEX and CDC that the Departments
assessment-rate calculation did not take further-manufactured sales
into account and requests that the Department include such sales into
its assessment-rate calculation for the final results of review.  It
provides a methodology to implement this recommendation which varies
slightly from CEMEXs suggested methodology.

Department's Position:  We disagree with the respondents and the
petitioner and have not incorporated their suggestions into our final
calculations.  Instead, we have calculated a per-unit duty-assessment
value using the reviewed sales and will instruct the U.S. Customs
Service to apply this value to all merchandise entered during the
review period regardless of whether value was added to it after
importation.  This approach will not cause any distortions with
respect to the merchandise that was entered and subsequently further
manufactured because, as indicated in CEMEXs and CDCs responses,
all merchandise, regardless of whether it was further manufactured,
was identical.  As we mentioned above, the statute is silent with
respect to the methodology by which we are to calculate assessment
rates.  See Federal Mogul Corp. v. United States, 918 F. Supp. 386,
404 (CIT, 1996).  Nonetheless, our general practice, while not
challenged in prior proceedings, has been to calculate an assessment
rate, or assessment value as applicable, based on the sales that were
reviewed during the period of review and apply this rate, or value,
to all entered merchandise, including those circumstances where the
company met our special rule for further-manufactured merchandise.


18.  Ministerial Errors

a.    Model-matching

Comment 30:  CEMEX and CDC state that the Department compared all
U.S. sales to a weighted-average normal value of CDC's sales.  CDC
contends that, for purposes for making price-based comparisons, the
Department should calculate normal value on a company-specific basis,
as the Department did in prior reviews of this order.  CEMEX requests
that the Department compare all U.S. sales to the weighted-average
normal value of both CEMEX and CDC.

The petitioner agrees that the Department matched CEMEX's and CDC's
U.S. sales only to the weighted-average normal value of CDC
incorrectly and requests that the Department correct the error.

Department's Position:  We agree with the respondents and the
petitioner that, in our
preliminary calculations, we neglected to include CEMEX's home-
market sales in our calculation of weighted-average normal values.
Consistent with our decision to collapse CEMEX and CDC, we have made
the necessary modifications to the calculations to ensure that both
CEMEX's and CDC's U.S. sales are compared to the respective weighted-
average normal value of home-market sales which both CEMEX and CDC
made during the POR.

Furthermore, we do not believe that we should calculate normal
value on a company-specific basis.  Calculating normal value on a
company-specific basis is inconsistent with our decision to collapse
CEMEX and CDC and would, in essence, result in a company-specific
margin analysis.  In addition, our decision to calculate a single
weighted-average normal value for both companies was not influenced
by prior reviews of this order.  Rather, in accordance with 19 CFR
351.104, our decision was based on and limited to the facts on the
record in this administrative review.

b.  CDCs Sales to Employees

Comment 31:  The petitioner contends that the Department did not
eliminate CDCs sales to employees from its calculations, as it
intended, due to the spacing of the identifier in the customer-
category field.  For the final results, the petitioner requests that
the Department insert language into its calculations to compensate
for spacing irregularities in the customer-category field.

CDC agrees with the petitioner and offers language to correct the
problem.

Departments Position:  We agree with the petitioner and CDC and
have modified our calculations to ensure that we eliminated CDCs
sales to employees from the calculation of normal value.

c.  U.S. Direct Selling Expenses

Comment 32:  The petitioner argues that, in calculating the foreign
unit price expressed in U.S. dollars (FUPDOL) for CDCs export-price
sales, the Department erred by adding U.S. direct selling expenses
valued in dollars per short ton to the sum of normal value, DIFMER,
and packing expenses valued in dollars per metric ton.  The
petitioner requests that the Department convert the relevant U.S.
direct selling expenses to metric tons so that all of the expenses in
the FUPDOL calculation are on a metric-ton basis.

Departments Position:  We agree have made the appropriate conversion.

Recommendation

Based on our analysis of the comments received, we recommend
adopting all of the above positions and adjusting all related margin
calculations accordingly.  If these recommendations are accepted, we
will publish the final results of review and the final weighted-
average dumping margins for all reviewed firms in the Federal
Register.
AGREE____DISAGREE____




________________________
Robert S. LaRussa
Assistant Secretary
  for Import Administration



_________________________
Date