[Federal Register Volume 61, Number 108 (Tuesday, June 4, 1996)]
[Notices]
[Pages 28166-28168]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-13964]



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DEPARTMENT OF COMMERCE
[A-201-601]


Fresh Cut Flowers From Mexico; Preliminary Results and Partial 
Termination of Antidumping Duty Administrative Review, and Intent to 
Revoke Antidumping Duty Order in Part

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

ACTION: Notice of preliminary results and partial termination of 
antidumping duty administrative review, and intent to revoke 
antidumping duty order in part.

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SUMMARY: The Department of Commerce (the Department) is conducting an 
administrative review of the antidumping duty order on certain fresh-
cut flowers from Mexico, in response to a request by a respondent, 
Rancho El Aguaje (Aguaje). Although we initiated reviews for two other 
producers, Rancho El Toro (Toro) and Rancho Guacatay (Guacatay), we are 
terminating these reviews because Toro and Guacatay timely withdrew 
their requests for review. We preliminarily intend to revoke the 
antidumping duty order with respect to Aguaje, based on our preliminary 
determination that Aguaje has had a three-year period of sales at not 
less than normal value (NV). This review covers one producer/exporter 
and entries of the subject merchandise into the United States during 
the period April 1, 1994 through March 31, 1995.
    We have preliminarily determined that sales have not been made 
below NV. Interested parties are invited to comment on these 
preliminary results. Parties who submit comments are requested to 
submit with each comment (1) a statement of the issue and (2) a brief 
summary of the comment.

EFFECTIVE DATE: June 4, 1996.

FOR FURTHER INFORMATION CONTACT: Rebecca Trainor or Maureen Flannery, 
Office of Antidumping Compliance, Import Administration, International 
Trade Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
4733.

Applicable Statutes and Regulations

    Unless otherwise states, all citations to the statute are 
references to the provisions effective January 1, 1995, the effective 
date of the amendments made to the Tariff Act of 1930 (the Act) by the 
Uruguay Round Agreements Act (URAA). In addition, unless otherwise 
indicated, all citations to the Department's regulations are to the 
current regulations, as amended by the interim regulations published in 
the Federal Register on May 11, 1995 (60 FR 25130).

SUPPLEMENTARY INFORMATION:

Background

    On April 23, 1987, the Department published in the Federal Register 
an antidumping duty order on certain fresh cut flowers from Mexico (52 
FR 13491).
    On April 27, 1995, Toro and Guacatay requested that the Department 
conduct an administrative review in accordance with 19 CFR 
353.22(a)(1). Toro and Guacatay also requested that the Department 
revoke the antidumping duty order as it pertains to them upon 
completion of the review. On April 28, 1995, Aguaje requested an 
administrative review and revocation of the order as it pertains to it 
upon completion of the review. We published a notice of initiation on 
May 15, 1995 (60 FR 25885), covering Toro, Guacatay, and Aguaje, and 
the period April 1, 1994 through March 31, 1995. On August 11, 1995, 
Toro and Guacatay timely withdrew their requests for review. Because 
there were no other requests for review for these two respondents from 
any other interested party, the Department is now terminating this 
review for Toro and Guacatay in accordance with section 353.22(a)(5) of 
the Department's regulations. We shall instruct the Customs Service to 
liquidate Toro's and Guacatay's entries of this period at the rates in 
effect at the time of entry. Because they are previously reviewed 
companies, the cash deposit rates will continue to be the company-
specific rates currently in effect.
    The Department is conducting this review in accordance with section 
751 of the Tariff Act of 1930, as amended (the Act).

Scope of the Review

    The products covered by this review are certain fresh cut flowers, 
defined as standard carnations, standard chrysanthemums, and pompon 
chrysanthemums. During the period of review, such merchandise was 
classifiable under Harmonized Tariff Schedule of the United States 
(HTSUS) items 0603.10.7010 (pompon chrysanthemums), 0603.10.7020 
(standard chrysanthemums), and 0603.10.7030 (standard carnations). The 
HTSUS item numbers are provided for convenience and Customs purposes 
only. The written description remains dispoitive as to the scope of the 
order.
    This review covers sales of the subject merchandise entered into 
the United States during the period April 1, 1994 through March 31, 
1995.

Verification

    From April 17 through April 19, 1996, the Department conducted 
verification of the questionnaire responses submitted by Aguaje, as 
provided in section 782(i) of the Act. We used standard verification 
procedures, including onsite inspection of the manufacturer's 
facilities, the examination of relevant accounting, sales, and other 
financial records, and selection of original documentation containing 
relevant information. Our verification results are outlined in the 
public version of the verification report.

[[Page 28167]]

Intent to Revoke

    Aguaje submitted a request, in accordance with 19 CFR 353.25(b), 
that the Department revoke the order covering certain fresh cut flowers 
from Mexico with respect to its sales of this merchandise.
    In accordance with 19 CFR 353.25(b)(1), this request was 
accompanied by a certification from Aguaje that it had not sold the 
relevant class or kind of merchandise at less then NV for a three year 
period including this review period, and would not be so in the future. 
Aguaje also agreed to its immediate reinstatement in the relevant 
antidumping order, as long as any firm is subject to that order, if the 
Department concludes under 19 CFR 353.22(f) that, subsequent to 
revocation, it sold the subject merchandise at less than NV.
    In the two prior reviews of this order, we determined that Aguaje 
sold the subject flowers from Mexico at not less than NV. The 
Department conducted a verification of the ranch's response for this 
period of review. In this review, we preliminarily determine that 
Aguaje has sold flowers at not less than NV, which will satisfy the 
three-year period of no sales at less than NV. Therefore, we intend to 
revoke the order in part on certain fresh cut flowers from Mexico with 
respect to Aguaje, if these preliminary findings are affirmed in our 
final results.

United States Price

    In calculating United States price, we used constructed export 
price (CEP), in accordance with subsections 772(b), (c) and (d) of the 
Act, because Aguaje's sales to the first unaffiliated purchaser 
occurred after importation into the United States. As in the original 
less-than-fair-value (LTFV) investigation and in all prior 
administrative reviews, all United States prices were weight-averaged 
on a monthly basis to account for perishability of the product. CEP was 
based on the packed prices to the first unrelated purchaser in the 
United States.
    Where appropriate, we made deductions from CEP for Mexican and U.S. 
inland freight, Mexican and U.S. brokerage and handling, and those 
imputed credit and warranty expenses that were incurred in the United 
States. We also deducted those selling expenses that related to 
commercial activity in the United States, and added amounts for 
revenues earned from box charges and delivery charges. Finally, we made 
an adjustment for CEP profit in accordance with section 772(d)(3) of 
the Act.

Normal Value

    Because Aguaje had no sales of comparable merchandise in the home 
market or to third countries, we based NV on constructed value (CV) as 
defined in section 773(a) of the Act. CV consists of the cost of 
materials and cultivation, general expenses, profit, and U.S. packing 
costs. We made a circumstance-of-sale adjustment to CV for the 
differences in direct selling expenses between CEP and CV.
    Aguaje reported no profit figure to be added to CV because it had 
no home market or third country sales of subject merchandise. As there 
was no suitable information on the record from which to derive a home 
market profit rate, we used facts otherwise available for Aguaje's 
profit rate. There was no suitable publicly available information on 
the record for Aguaje for any prior review period and no other 
respondent in the current review. In addition, there is insufficient 
information on the record to calculate Aguaje's profit for the same 
general category of product as the subject merchandise. Therefore, we 
used the weighted average publicly available profit rate for other 
flower producers examined in the 1992-1993 review.
    Aguaje's overall corporate G&A figure could not be verified because 
Aguaje could not locate all of the G&A support documents at 
verification. However, the company was generally cooperative. From the 
information in the current review and publicly available information 
from prior reviews, we identified three possible alternatives for G&A 
in this case: (1) Aguaje's submitted G&A data; (2) Aguaje's publicly 
available G&A data from a prior review period; and (3) publicly 
available G&A data submitted by other Mexican flower producers for 
prior review periods. We chose the alternative that resulted in the 
highest G&A percentage. Therefore, we have calculated an amount for G&A 
based on Aguaje's publicly available information from the most recently 
verified review period as facts otherwise available. For each month, we 
used the higher of this amount, or Aguaje's reported G&A costs. Our 
calculation of profit and G&A is discussed further in the memo to the 
file dated May 23, 1996, on file in Room B-099 of the Commerce 
Department.

Use of Facts Otherwise Available

    Section 776(b) of the Act authorizes the Department to use as facts 
otherwise available information derived from the petition, the final 
determination, a previous administrative review, or other information 
place on the record. Because information from prior proceedings 
constitutes secondary information, section 776(c) provides that the 
Department shall, to the extent practicable, corroborate that secondary 
information from independent sources reasonably at its disposal. The 
Statement of Administrative Action (SAA) provides that ``corroborate'' 
means simply that the Department will satisfy itself that the secondary 
information to be used has probative value.
    In this case, we used the weighted-average publicly available 
profit rates of different Mexican flower producers, from verified data 
they reported for the 1992-1993 review period. We compared the separate 
home market profit rates of these companies to each other, and found 
them to be comparable. The profit rate we have applied to Aguaje is 
reliable and relevant, and therefore has probative value, because it is 
representative of the profits found to be earned by other Mexican 
flower producers during a recent review period. The G&A percentage we 
used also has probative value because it is the company's own verified 
rate from a recent review period.

Preliminary Results of Review

    As a result of our comparison of CEP and CV, we preliminarily 
determine that the following weighted-average dumping margin exists:

------------------------------------------------------------------------
                                                                Margin  
                   Manufacturer/exporter                      (percent) 
------------------------------------------------------------------------
Rancho El Aguaje...........................................         0.00
------------------------------------------------------------------------

    Parties to the proceeding may request disclosure within 5 days of 
the date of publication of this notice. Any interested party may 
request a hearing within 10 days of publication. Any hearing, if 
requested, will be held 44 days after the publication of this notice, 
or the first workday thereafter. Interested parties may submit case 
briefs within 30 days of the date of publication of this notice. 
Rebuttal briefs, which must be limited to issues raised in the case 
briefs, may be filed no later than 37 days after the date of 
publication. Parties who submit comments are requested to submit with 
their comments (1) a statement of the issue and (2) a brief summary of 
the comment. The Department will publish a notice of final results of 
this administrative review, which will include the results of its 
analysis of issues raised in any such comments.
    The Department shall determine, and the Customs Service shall 
assess, antidumping duties on all appropriate

[[Page 28168]]

entries. Individual differences between CEP and NV may vary from the 
percentage stated above. Upon completion of this review, the Department 
will issue appraisement instructions directly to the Customs Service.
    Furthermore, the following deposit rates will be effective upon 
publication of the final results of this administrative review for all 
shipments of certain fresh cut flowers from Mexico entered, or 
withdrawn from warehouse, for consumption on or after the publication 
date, as provided for by section 751 (a)(2)(c) of the Act: (1) The cash 
deposit rate for the reviewed company will be the rate established in 
the final results of this review; (2) for merchandise exported by 
manufacturers or exporters not covered in these reviews but covered in 
the original LTFV investigation or previous review, the cash deposit 
will continue to be the company-specific rate published for the most 
recent period; (3) if the exporter is not a firm covered in this or a 
previous review, or the original LTFV investigation, but the 
manufacturer is, the cash deposit rate will be the rate established for 
the most recent period for the manufacturer of the merchandise; and (4) 
for all other producers and/or exporters of the merchandise, the cash 
deposit rate shall be 18.20 percent, the rate established in the LTFV 
investigation.
    These deposit rates, when imposed, shall remain in effect until 
publication of the final results of the next administrative review.
    This notice also serves as a preliminary reminder to importers of 
their responsibility under 19 CFR 353.26 to file a certificate 
regarding the reimbursement of antidumping duties prior to liquidation 
of the relevant entries during this review period. Failure to comply 
with this requirement could result in the Secretary's presumption that 
reimbursement of antidumping duties occurred and the subsequent 
assessment of double antidumping duties.
    This administrative review and notice are in accordance with 
sections 751(a)(1) and 751(d)(1) of the Act (19 U.S.C. 1675(a)) and 19 
CFR 353.22 and 353.25.

    Dated: May 23, 1996.
Paul L. Joffe,
Acting Assistant Secretary for Import Administration.
[FR Doc. 96-13964 Filed 6-3-96; 8:45 am]
BILLING CODE 3510-DS-P-M