Certain Pasta From Italy: Preliminary Results and Partial Rescission of the Eighth Countervailing Duty Administrative Review, 17971-17975 [05-6958]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 70, Number 67 (Friday, April 8, 2005)]
[Notices]
[Pages 17971-17975]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-6958]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-475-819]


Certain Pasta From Italy: Preliminary Results and Partial 
Rescission of the Eighth Countervailing Duty Administrative Review

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

SUMMARY: The Department of Commerce is conducting an administrative 
review of the countervailing duty order on certain pasta from Italy for 
the period January 1, 2003 through December 31, 2003. We preliminarily 
find that the countervailing duty rates during the period of review for 
all of the producers/exporters under review are less than 0.5 percent 
and are, consequently, de minimis. See the ``Preliminary Results of 
Review'' section, below. If the final results remain the same as these 
preliminary results, we will instruct U.S. Customs and Border 
Protection to liquidate entries during the period January 1, 2003 
through December 31, 2003 without regard to countervailing duties in 
accordance with 19 CFR 351.106(c)(1). We are also rescinding the review 
for Pastificio Carmine Russo S.p.A./Pastificio Di Nola S.p.A. and 
Pastificio Antonio Pallante S.r.1. in accordance with 19 CFR 
351.213(d)(3). Interested parties are invited to comment on these 
preliminary results (see the ``Public Comment'' section of this 
notice).

DATES: Effective Date: April 8, 2005.

FOR FURTHER INFORMATION CONTACT: Melani Miller Harig or Mac Rivitz, AD/
CVD Operations, Office 1, Import Administration, U.S. Department of 
Commerce, Room 3099, 14th Street and Constitution Avenue, NW., 
Washington, DC 20230; telephone (202) 482-0116 and (202) 482-1382, 
respectively.

SUPPLEMENTARY INFORMATION

Case History

    On July 24, 1996, the Department of Commerce (``the Department'') 
published a countervailing duty order on certain pasta (``pasta'' or 
``subject merchandise'') from Italy. See Notice of Countervailing Duty 
Order and Amended Final Affirmative Countervailing Duty Determination: 
Certain Pasta From Italy, 61 FR 38544 (July 24, 1996). On July 1, 2004, 
the Department published a notice of ``Opportunity to Request 
Administrative Review'' of this countervailing duty order for calendar 
year 2003, the period of review (``POR''). See Antidumping or 
Countervailing Duty Order, Finding, or Suspended Investigation; 
Opportunity to Request Administrative Review, 69 FR 39903 (July 1, 
2004). On July 30, 2004, we received requests for reviews from the 
following four producers/exporters of Italian pasta: Pastificio Antonio 
Pallante S.r.1. (``Pallante''), Pastificio Corticella S.p.A. 
(``Corticella'')/Pastificio Combattenti S.p.A. (``Combattenti'') 
(collectively, ``Corticella/Combattenti''), Pasta Lensi S.r.1. 
(``Lensi''), \1\ and Pastificio Carmine Russo S.p.A./Pastificio Di Nola 
S.p.A. (collectively, ``Russo/Di Nola''). In accordance with 19 CFR 
351.221(c)(1)(i), we published a notice of initiation of the review on 
August 30, 2004. See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews and Requests for Revocation in Part, 69 FR 52857 
(August 30, 2004).
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    \1\ Lensi is the successor-in-interest to IAPC Italia S.r.1. See 
Notice of Final Results of Antidumping and Countervailing Duty 
Changed Circumstances Reviews: Certain Pasta from Italy, 68 FR 41553 
(July 14, 2003).
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    On September 7,2004, we issued countervailing duty questionnaires 
to the Commission of the European Union, the Government of Italy 
(``GOI''), Pallante, Corticella/Combatteni, Lensi, and Russo/Di Nola. 
We received responses to our questionnaires in October and November 
2004. We issued supplemental questionnaires to the respondents in 
November 2004, and received responses to our supplemental 
questionnaires in November and December 2004.
    On September 15, 2004, Russo/Di Nola withdrew its request for 
review. Pallante withdrew its request for review on October 28, 2004. 
As discussed in the ``Partial Rescission'' section, below, we are 
rescinding this administrative review for both Russo/Di Nola and 
Pallante.

Partial Rescission

    The Department's regulations at 19 CFR 351.213(d)(1) provide that 
the Department will rescind an administrative review, in whole or in 
part, if a party that requested a review withdraws the request within 
90 days of the date of publication of the notice of initiation of the 
requested review. On September 15, 2004, Russo/Di Nola withdrew its 
request for an administrative review; Pallante withdrew its request for 
an administrative review on October 28, 2004. Both parties submitted 
their withdrawal requests within the 90-day deadline. No other party 
requested a review of Pallante's or Russo/Di Nola's sales. Therefore, 
because these withdrawal requests were timely filed, we are rescinding 
this review with respect to Pallante and Russo/Di Nola in accordance 
with 19 CFR 351.213(d)(1). We will instruct U.S. Customs and Border 
Protection (``Customs'') to liquidate any entries from Pallante and 
Russo/Di Nola during the POR and to assess countervailing duties at the 
rate that was applied at the time of entry.

Scope of the Order

    Imports covered by the order are shipments of certain non-egg dry 
pasta in packages of five pounds four ounces or less, whether or not 
enriched or fortified or containing milk or other optional ingredients 
such as chopped vegetables, vegetable purees, milk, gluten, diastasis, 
vitamins, coloring and flavorings, and up to two percent egg white. The 
pasta covered by this scope is typically sold in the retail market, in 
fiberboard or cardboard cartons, or polyethylene or polypropylene bags 
of varying dimensions.
    Excluded from the scope of the order are refrigerated, frozen, or 
canned pastas, as well as all forms of egg pasta, with the exception of 
non-egg dry pasta containing up to two percent egg white. Also excluded 
are imports of organic pasta from Italy that are accompanied by the 
appropriate certificate issued by the Instituto Mediterraneo Di 
Certificazione, Bioagricoop S.r.l., QC&I International Services, 
Ecocert Italia, Consorzio per il Controllo dei Prodotti Biologici, 
Associazione Italiana per l' Agricoltura Biologica, or Codex S.r.L. In 
addition, based on publicly available information, the Department has 
determined that, as of August 4, 2004, imports of organic pasta from 
Italy that are accompanied by the appropriate certificate issued by 
Bioagricert S.r.l. are also excluded from this order. See memorandum 
from Eric B. Greynolds to Melissa G. Skinner, dated August 4, 2004, 
which is on file

[[Page 17972]]

in the Department's Central Records Unit (``CRU'') in Room B-099 of the 
main Department Building.
    The merchandise subject to review is currently classifiable under 
items 1901.90.9095 and 1902.19.20 of the Harmonized Tariff Schedule of 
the United States (``HTSUS''). Although the HTSUS subheadings are 
provided for convenience and customs purposes, the written description 
of the merchandise subject to the order is dispositive.

Scope Rulings

    The Department has issued the following scope rulings to date:
    (1) On August 25, 1997, the Department issued a scope ruling that 
multicolored pasta, imported in kitchen display bottles of decorative 
glass that are sealed with cork or paraffin and bound with raffia, is 
excluded from the scope of the antidumping and countervailing duty 
orders. See memorandum from Edward Easton to Richard Moreland, dated 
August 25, 1997, which is on file in the CRU.
    (2) On July 30, 1998, the Department issued a scope ruling finding 
that multipacks consisting of six one-pound packages of pasta that are 
shrink-wrapped into a single package are within the scope of the 
antidumping and countervailing duty orders. See letter from Susan H. 
Kuhbach to Barbara P. Sidari, dated July 30, 1998, which is available 
in the CRU.
    (3) On October 23, 1997, the petitioners filed an application 
requesting that the Department initiate an anti\circumvention 
investigation of Barilla S.r.L. (``Barilla''), an Italian producer and 
exporter of pasta. The Department initiated the investigation on 
December 8, 1997. See Initiation of Anti-Circumvention Inquiry on 
Antidumping Duty Orders on Certain Pasta From Italy, 62 FR 65673 
(December 15, 1997). On October 5, 1998, the Department issued its 
final determination that, pursuant to section 781(a) of the Tariff Act 
of 1930, as amended by the Uruguay Round Agreements Act (``URAA'') 
effective January 1, 1995 (``the Act''), circumvention of the 
antidumping order on pasta from Italy was occurring by reason of 
exports of bulk pasta from Italy produced by Barilla which subsequently 
were repackaged in the United States into packages of five pounds or 
less for sale in the United States. See Anti-Circumvention Inquiry of 
the Antidumping Duty Order on Certain Pasta from Italy: Affirmative 
Final Determination of Circumvention of the antidumping Duty Order, 63 
FR 54672 (October 13, 1998).
    (4) On October 26, 1998, the Department self-initiated a scope 
inquiry to determine whether a package weighing over five pounds as a 
result of allowable industry tolerances is within the scope of the 
antidumping and countervailing duty orders. On May 24, 1999, we issued 
a final scope ruling finding that, effective October 26, 1998, pasta in 
packages weighing or labeled up to (and including) five pounds four 
ounces is within the scope of the antidumping and countervailing duty 
orders. See memorandum from John Brinkmann to Rickard Moreland, dated 
May 24, 1999, which is available in the CRU.
    (5) On April 27, 2000, the Department self-initiated an anti-
circumvention inquiry to determine whether Pastificio Fratelli Pagani 
S.p.A.'s importation of pasta in bulk and subsequent repackaging in the 
United States into packages of five pounds or less constitutes 
circumvention with respect to the antidumping and countervailing duty 
orders on pasta from Italy pursuant to section 781(a) of the Act and 19 
CFR 351.225(b). See Certain Pasta from Italy: Notice of Initiation of 
Anti-circumvention Inquiry of the Antidumping and Countervailing Duty 
Orders, 65 FR 26179 (May 5, 2000). On September 19, 2003, we published 
an affirmative finding of the anti-circumvention inquiry. See Anti-
Circumvention Inquiry of the Antidumping and Countervailing Duty Orders 
on Certain Pasta from Italy: Affirmative Final Determinations of 
Circumvention of Antidumping and Countervailing Duty Orders, 68 FR 
54888 (September 19, 2003).

Period of Review

    The period for which we are measuring subsidies, or POR, is January 
1, 2003 through December 31, 2003.

Changes in Ownership

    Effective June 30, 2003, the Department adopted a new methodology 
for analyzing privatizations in the countervailing duty context. See 
Notice of Final Modification of Agency Practice Under Section 123 of 
the Uruguay Round Agreements Act, 68 FR 37125 (June 23, 2003) 
(``Modification Notice'').\2\ The Department's new methodology is based 
on a rebuttable ``baseline'' presumption that non-recurring, allocable 
subsides continue to benefit the subsidy recipient throughout the 
allocation period (which normally corresponds to the average useful 
life (``AUL'') of the recipient's assets). However, an interested party 
may rebut this baseline presumption by demonstrating that, during the 
allocation period, a change in ownership occurred in which the former 
owner sold all or substantially all of a company or its assets, 
retaining no control of the company or its assets, and that the sale 
was an arm's-length transaction for fair market value.
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    \2\ The Modification Notice explicitly addresses full 
privatizations, but notes that the Department would not make a 
decision at that time as to whether the new methodology would also 
be applied to other types of ownership changes and factual 
scenarios, such as partial privatizations or private-to-private 
sales. See 68 FR at 37136. We have now determined to apply the new 
methodology to full, private-to-private sales of a company (or its 
assets) as well. Among other reasons, we note that our prior ``same 
person'' methodology used for analyzing changes in ownership such as 
private-to-private sales has been found not in accordance with law 
in Allegheny Ludlum Corp. v. United States, 367 F.3d 1339 (Fed. Cir. 
2004).
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    In considering whether the evidence presented demonstrates that the 
transaction was conducted at arm's length, we will be guided by the 
definition of an arm's-length transaction included in the Statement of 
Administrative Action accompanying the URAA, H.R. Doc. No. 103-316, 
vol. 1 (1994), which defines an arm's-length transaction as a 
transaction negotiated between unrelated parties, each acting in its 
own interest, or between related parties such that the terms of the 
transaction are those that would exist if the transaction had been 
negotiated between unrelated parties. See id. at 928.
    In analyzing whether the transaction was for fair market value, the 
basic question is whether the full amount that the company or its 
assets (including the value of any subsidy benefits) was actually worth 
under the prevailing market conditions was paid, and paid through 
monetary or equivalent compensation. In making this determination, the 
Department will normally examine whether the seller acted in a manner 
consistent with the normal sales practices of private, commercial 
sellers in that country. Where an arm's-length sale occurs between 
purely private parties, we would normally expect the private seller to 
act in a manner consistent with the normal sales practices of private, 
commercial sellers in that country. With regard to a government-to-
private transaction, however, where we cannot make that same 
assumption, a primary consideration in this regard normally will be 
whether the government failed to maximize its return on what it sold, 
indicating that the purchaser paid less for the company or assets than 
it otherwise would have had the government acted in a manner

[[Page 17973]]

consistent with the normal sales practices of private, commercial 
sellers in that country.
    If we determine that the evidence presented does not demonstrate 
that the change in ownership was at arm's length for fair market value, 
the baseline presumption will not be rebutted and we will find that the 
unamortized amount of any pre-sale subsidy benefit continues to be 
counteravailable. Otherwise, if it is demonstrated that the change in 
ownership was at arm's length for fair market value, any pre-sales 
subsidies will be presumed to be extinguished in their entirety and, 
therefore, non-counteravailable.
    A party can, however, obviate this presumption of extinguishment by 
demonstrating that, at the time of the change in ownership, the broader 
market conditions necessary for the transaction price to reflect fairly 
and accurately the subsidy benefit were not present, or were severely 
distorted by government action (or, where appropriate, inaction). In 
other words, even if we find that the sales price was at ``market 
value,'' parties can demonstrate that the broader market conditions 
were severely distorted by the government and that the transaction 
price was meaningfully different from what it would otherwise have been 
absent the distortive government action.
    Where a party demonstrates that these broader market conditions 
were severely distorted by government action and that the transaction 
price was meaningfully different from what it would otherwise have been 
absent the distortive government action, the baseline presumption will 
not be rebutted and the unamortized amount of any non-recurring pre-
sale subsidy benefit will continue to be countervailable. Where a party 
does not make such a demonstration with regard to an arm's-length sale 
for fair market value, we will find all non-recurring pre-sale 
subsidies to be extinguished by the sale and, therefore, non-
countervailable.
    In the instant proceeding, Corticella/Combattenti underwent changes 
in ownership during the applicable period. Corticella/Combattenti did 
not challenge the Department's baseline presumption that non-recurring 
subsidies continue to benefit the recipient over the allocation period. 
Thus, we preliminarily find for this respondent that any unallocated 
benefits from non-recurring subsidies received prior to its change in 
ownership continue to be countervailable.

Subsidies Valuation Information

Allocation Period

    Pursuant to 19 CFR 351.524(b), non-recurring subsidies are 
allocated over a period corresponding to the AUL of the renewable 
physical assets used to produce the subject merchandise. Section 
351.524(d)(2) of the Department's regulations creates a rebuttable 
presumption that the AUL will be taken from the U.S. Internal Revenue 
Service's 1977 Class Life Asset Depreciation Range System (``IRS 
Tables''). See 19 CFR 351.524(d)(2). For pasta, the IRS Tables 
prescribe an AUL of 12 years. None of the responding companies or 
interested parties objected to this allocation period. Therefore, we 
have used the 12-year allocation period for all respondents.

Attribution of Subsidies

    Pursuanty to 19 CFR 351.525(b)(6), the Department will attribute 
subsidies received by certain companies to the combined sales of those 
companies. Based on our review of the responses, we preliminarily find 
that ``cross-ownership'' exists with respect to certain companies, as 
described below, and we have attributed subsidies accordingly.
    Lensi: Lensi is an Italian producer and exporter of pasta. As 
further discussed in the April 4, 2005 proprietary memorandum entitled 
``Pasta Lensi S.r.1.--Attribution Issues,'' which is on file in the 
Department's CRU, Lensi has reported that IAPC Leasing, another company 
in Lensi's family of companies, did not receive any benefits under the 
programs being examined. Therefore, there are no benefits to this 
company that require attribution. Moreover, IAPC Leasing does not 
produce subject merchandise. Thus, we are attributing any subsidies 
received to Lensi's sales only.
    Corticella/Combattenti: Corticella and Combattenti are both 
producers of the subject merchandise and are owned by the same holding 
company, Euricom S.p.A. (``Euricom''), and companies in the Euricom 
group. Euricom group companies own 100 percent of Combattenti and 70 
percent of Corticella. Other Euricom group companies are also involved 
in the production and distribution of subject merchandise. 
Specifically, one group company (whose name is proprietary), receives a 
commission on some of Corticella's home market sales. Also, Euricom 
group company Molini Certosa S.p.A. (``Certosa'') mills durum and non-
durum wheat, some of which is an input for the Corticella/Combattenti 
subject merchandise.
    Additionally, Cooperative Lomellina Cerealicoltori (``CLC''), which 
is a cooperative, provides conversion services for Combattenti. CLC was 
formed in 1980 for the sole purpose of producing rise. In 1990, CLC 
signed an agreement with Combattenti to ``toll produce all of 
Combattenti's pasta production requirements'' following a fire at 
Combattenti's pasta factory. See Corticella/Combattenti's November 5, 
2004 submission at Exhibit 2, page 5. CLC is not part of the Euricom 
group and Euricom is not a member of CLC. However, Euricom's majority 
shareholder is a member/shareholder of the CLC cooperative. Euricom's 
majority shareholder was the sole administrator of Combattenti during 
most of the POR, and also ``had operational and management control over 
CLC and could direct CLC's workers.'' See id. The son of Euricom's 
majority shareholder was also a CLC member/shareholder, as well as 
member of both Combattenti's and CLC's boards, and was ``very active in 
both companies day to day activities.'' See id. According to 
Corticella/Combattenti, Euricom's majority shareholder and his son 
control ``the direction of CLC and Combattenti,'' with Euricom's 
majority shareholder ``taking a more strategic role'' and his son 
``taking a hands-on-day-to-day operational role.'' See Corticella/
Combattenti's December 6, 2004 submission at 4.
    With regard to Corticella and Combattenti, we preliminarily find 
that they each meet the criteria for cross-ownership in 19 CFR 
351.525(b)(6)(ii). As for Certosa, we preliminarily find that it meets 
the criteria in 19 CFR 351.525(b)(6)(iv). With regard to the Euricom 
group company that receives a commission on some of Corticella's home 
market sales, the company does not meet any of the criteria in 19 CFR 
351.525(b)(6)(ii) through (iv). Moreover, because Corticella/
Combattenti has reported that this company acts as a selling agent only 
on Corticella's home market sales and not on its exports, 19 CFR 
351.525(c) does not apply. Thus, we are also not including subsidies 
received by this company or this company's sales in our preliminary 
subsidy calculations.
    Finally, with regard to CLC, in Certain Pasta from Italy: Final 
Results of the Seventh Countervailing Duty Administrative Review, 69 FR 
70657 (December 7, 2004) (``Pasta Seventh Review'') and the 
accompanying Issues and Decision Memorandum in the ``Attribution of 
Subsidies'' section, we determined that cross-ownership did not exist 
with regard to CLC consistent with 19 CFR 351.525(b)(6)(vi). In the

[[Page 17974]]

instant review, we have new information with regard to CLC and its 
relationship with Combattenti and the Euricom group that might, 
otherwise, warrant a reconsideration of our earlier finding. However, 
because CLC did not receive any benefits under the programs being 
examined, and because CLC's other division (the first being the 
division that operates the Combattenti facilities), has no past-related 
operations, there is no need in the instant review to revisit our 
previous finding on this matter.
    Combattenti/Corticella has reported that Euricom and Certosa did 
not receive any POR subsidies. Thus, we are attributing any subsidies 
received to the combined sales of Corticella and Combattenti.

Discount Rates

    Pursuant to 19 CFR 351.524(d)(3)(i)(B), we used the national 
average cost of long-term, fixed-rate loans as a discount rate for 
allocating non-recurring benefits over time because no company for 
which we need such discount rates took out any loans in the years in 
which the government agreed to provide the subsidies in question. 
Consistent with past practice in this proceeding, for years prior to 
1995, we used the Bank of Italy reference rate adjusted upward to 
reflect the mark-up an Italian commercial bank would charge a corporate 
customer. For benefits received in 1995 and later, we used the Italian 
Bankers' Association interest rate, increased by the average spread 
charged by banks on loans to commercial customers plus an amount for 
bank charges.

Analysis of Programs

I. Program Preliminarily Determined To Confer Subsidies During the POR

Export Marketing Grants Under Law 304/90
    Under Law 304/90, the GOI provided grants to promote the sale of 
Italian food and agricultural products in foreign markets. The grants 
were given for pilot projects aimed at developing links and integrating 
marketing efforts between Italian food producers and foreign 
distributors. The emphasis was on assisting small and medium-sized 
enterprises.
    Corticella received a grant under this program in 1993 to assist it 
in establishing a sales office and network in the United States. No 
other respondent covered by this review received benefits under this 
program during the POR.
    In the Final Affirmative Countervailing Duty Determination: Certain 
Pasta from Italy, 61 FR 30288 (June 14, 1996) (``Pasta 
Investigation''), the Department determined that these export marketing 
grants confer a countervailable subsidy within the meaning of section 
771(5) of the Act. They are a direct transfer of funds from the GOI 
bestowing a benefit in the amount of the grant. Also, these grants were 
found to be specific within the meaning of section 771(5A)(B) of the 
Act because their receipt was contingent upon exportation. In this 
review, neither the GOI nor the responding companies have provided new 
information which would warrant reconsideration of our determination 
that these grants confer a countervailable subsidy.
    Also in the Pasta Investigation, the Department treated these 
export marketing grants as non-recurring. No new information has been 
placed on the record of this review that would cause us to depart from 
this treatment.
    Because the amount of the grant that was approved by the GOI 
exceeded 0.5 percent of Corticella's exports to the United States in 
the year of approval, we used the grant methodology described in 19 CFR 
351.524(d) to allocate the benefit over time. We divided the benefit 
attributable to the POR by the value of the companies' total exports to 
the United States in the POR.
    On this basis, we preliminarily determine the countervailable 
subsidy from these Law 304/90 export marketing grants to be 0.06 
percent ad valorem for Corticella/Combattenti.

II. Programs Preliminarily Determined Not To Confer Subsidies During 
the POR

A. Social Security Reductions and Exemptions--Sgravi
    Italian law allows companies, particularly those localted in the 
Mezzogiorno (sourthern Italy), to use a variety of exemptions and 
reductions (sgravi) of the payroll contributions that employers make to 
the Italian social security system for health care benefits, pensions, 
etc. The sgravi benefits are regulated by a complex set of laws and 
regulations, and are sometimes linked to conditions such as creating 
more jobs. We have found in past segments of this proceeding that the 
benefits under some of these laws (e.g., Laws 183/76 and 449/97) are 
available only to companies located in the Mezzogiorno and other 
disadvantaged regions. Other laws (e.g., Laws 407/90 and 863/84) 
provide benefits to companies all over Italy, but the level of benefits 
is higher for companies in the south than for companies in other parts 
of the country.
    The various laws identified as having provided sgravi benefits 
during the POR are the following: Law 407/90 (Lensi), Law 223/91 (Lensi 
and Combattenti), and Law 337/90 (Corticella).
    In the instant review, no party in this proceeding challenged our 
past determinations in the Pasta Investigation and subsequent reviews 
that sgravi benefits were not countervailable for companies located 
outside of the Mezzogiorno. Additionally, no new information or 
evidence of changed circumstances was received that would warrant 
reconsideration of these past determinations. Therefore, because Lensi 
and Corticella/Combattenti are not located in the Mezzogiorno, we find 
that neither of these companies recieved countervailable subsidies 
under this program during the POR.
B. Brescia Chamber of Commerce Grants
    The Chamber of Commerce of Brescia provided training grants during 
2002 and 2003 to companies in the province of Brescia for the 
professional training of entrepreneurs, directors, and employees. The 
goal of these grants was to improve economic, social, and productive 
development in the province. The Brescia Chamber of Commerce also 
provided grants to small and medium-sized enterprises, artisan and 
agricultural enterprises, and pools and cooperatives in the province of 
Brescia for their direct participation in fairs and exhibitions abroad 
during calendar year 2003.
    Lensi was the only respondent in this proceeding that reported 
receiving grants from the Brescia Chamber of Commerce. Specifically, 
Lensi reported receiving training grants from the Brescia Chamber of 
Commerce in 2002 and 2003. Lensi also reported receiving a fairs and 
exhibitions grant in 2004, subsequent to the POR.
    With regard to the training grants, in situations where any benefit 
to the subject merchandise would be so small that there would be no 
impact on the overall subsidy rate, regardless of a determination of 
counteravailability, it may not be necessary to determine whether 
benefits conferred under these programs to the subject merchandise are 
counteravailable. (See, e.g., Pasta Seventh Review and Live Cattle From 
Canada; Final Negative Countervailing Duty Determination, 64 FR 57040, 
57055 (October 22, 1999).) In this instance, any benefit to the subject 
merchandise resulting from this grant would be so small that there 
would be no impact on the overall subsidy rate, regardless of a 
determination of counteravailability. Thus, consistent with our past 
practice, we do not consider it necessary to determine

[[Page 17975]]

whether benefits conferred thereunder to the subject merchandise are 
countervailable.
    As for the fairs and exhibitions grant, because it was received in 
2004, subsequent to the POR, we preliminarily find that no benefit was 
provided to Lensi during the POR from this grant.

III. Programs Preliminarily Determined Not to Have Been Used During the 
POR

    We examined the following programs and preliminarily determine that 
the producers and/or exporters of the subject merchandise under review 
did not apply for or receive benefits under these programs during the 
POR:

A. Industrial Development Grants Under Law 488/92
B. Industrial Development Loans Under Law 64/86
C. European Regional Development Fund Grants
D. Law 236/93 Training Grants
E. Law 1329/65 Interest Contributions (Sabatini Law) (Formerly Lump-Sum 
Interest Payment Under the Sabatini Law for Companies in Southern 
Italy)
F. Development Grants Under Law 30 of 1984
G. Law 908/55 Fondo di Rotazione Iniziative Economiche (Revolving Fund 
for Economic Initiatives) Loans
H. Industrial Development Grants Under Law 64/86
I. Law 317/91 Benefits for Innovative Investments
J. Tremonti Law 489/94 (Formerly Law Decree 357/94)
k. Ministerial Decree 87/02
L. Law 10/91 Grants to Fund Energy Conservation
M. Law 341/95 Interest Contributions on Debt Consolidation Loans 
(Formerly Debt Consolidation Law 341/95)
N. Regional Tax Exemptions Under IRAP
O. Corporate Income Tax (IRPEG) Exemptions
P. Export Restitution Payments
Q. VAT Reductions Under Laws 64/86 and 675/55
R. Export Credits Under Law 227/77
S. Capital Grants Under Law 675/77
T. Retraining Grants Under Law 675/77
U. Interest Contributions on Bank Loans Under Law 675/77
V. Interest Grants Financed by IRI Bonds
W. Preferential Financing for Export Promotion Under Law 394/81
X. Urban Redevelopment Under Law 181
Y. Grant Received Pursuant to the Community Initiative Concerning the 
Preparation of Enterprises for the Single Market (PRISMA)
Z. Industrial Development Grants under Law
AA. Interest Subsidies Under Law 598/94
AB. Duty-Free Import Rights
AC. Remission of Taxes on Export Credit Insurance Under Article 33 of 
Law 227/77
AD. European Social Fund Grants
AE. Law 113/86 Training Grants
AF. European Agricultural Guidance and Guarantee Fund

Preliminary Results of Review

    In accordance with 19 CFR 351.221(b)(4)(i), we calculated an 
individual subsidy rate for each producer/exporter covered by this 
administrative review. For the period January 1, 2003 through December 
31, 2003, we preliminarily find the net subsidy rates for the 
producers/exporters under review to be those specified in the chart 
shown below:

------------------------------------------------------------------------
                                                                  Net
                                                                subsidy
                      Producer/exporter                          rate
                                                               (percent)
------------------------------------------------------------------------
Pasta Lensi S.r.1...........................................    \1\ 0.00
Pastificio Corticella S.p.A./Pastificio Combattenti S.p.A...   \1\ 0.06
------------------------------------------------------------------------
\1\ De minimis.

The calculations will be disclosed to the interested parties in 
accordance with 19 CFR 351.224(b).
    If the final results of this review remain the same as these 
preliminary results, because the countervailing duty rates for all of 
the above-noted companies are less than 0.5 percent and, consequently, 
de minimis, we will instruct Customs to liquidate entries during the 
period January 1, 2003 through December 31, 2003 without regard to 
countervailing duties in accordance with 19 CFR 351.106(c)(1). The 
Department will issue appropriate instructions directly to Customs 
within 15 days of publication of these final results of this review.
    For all other companies that were not reviewed (except Barilla G. e 
R. F.IIi S.p.A. and Gruppo Agricoltura Sana S.r.L., which are excluded 
from the order), the Department has directed Customs to assess 
countervailing duties on all entries between January 1, 2003 and 
December 31, 2003 at the rates in effect at the time of entry.
    The Department also intends to instruct Customs to collect cash 
deposits of estimated countervailing duties for the above-noted 
companies at the above-noted rates on the f.o.b. value of all shipments 
of the subject merchandise from the producers/exporters under review 
that are entered, or withdrawn from warehouse, for consumption on or 
after the date of publication of the final results of this 
administrative review. For all non-reviewed firms (except Barilla G. e 
R. F.IIi S.p.A, and Gruppe Agricoltura Sana S.r.L., which are excluded 
from the order), we will instruct Customs to collect cash deposits of 
estimated countervailing duties at the most recent company-specific or 
all others rate applicable to the company. These rates shall apply to 
all non-reviewed companies until a review of a company assigned these 
rates is requested.

Public Comment

    Interested parties may submit written arguments in case briefs 
within 30 days of the date of publication of this notice. Rebuttal 
briefs, limited to issues raised in case briefs, may be filed not later 
than five days after the date of filing the case briefs. Parties who 
submit briefs in this proceeding should provide a summary of the 
arguments not to exceed five pages and a table of statutes, 
regulations, and cases cited. Copies of case briefs and rebuttal briefs 
must be served on interested parties in accordance with 19 CFR 
351.303(f).
    Interested parties may request a hearing within 30 days after the 
date of publication of this notice. Any hearing, if requested, will be 
held two days after the scheduled date for submission of rebuttal 
briefs.
    The Department will publish a notice of the final results of this 
administrative review within 120 days from the publication of these 
preliminary results.
    We are issuing and publishing these results in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: March 31, 2005.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 05-6958 Filed 4-7-05; 8:45 am]
BILLING CODE 3510-DS-M