Notice of Preliminary Determinations of Sales at Less Than Fair Value and of Critical Circumstances in Part: Lemon Juice from Mexico, 20830-20836 [E7-8019]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 72, Number 80 (Thursday, April 26, 2007)]
[Notices]
[Pages 20830-20836]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-8019]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-201-835]


Notice of Preliminary Determinations of Sales at Less Than Fair 
Value and of Critical Circumstances in Part: Lemon Juice from Mexico

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: We preliminarily determine that imports of lemon juice from 
Mexico are being, or are likely to be, sold in the United States at 
less than fair value, as provided in section 733 of the Tariff Act of 
1930, as amended. In addition, we preliminarily determine that there is 
a reasonable basis to believe or suspect that critical circumstances 
exist with respect to the imports of lemon juice from Mexico for one 
respondent. Interested parties are invited to comment on this 
preliminary determination. We will make our final determination within 
75 days after the date of this preliminary determination.

FOR FURTHER INFORMATION CONTACT: George Callen or Minoo Hatten, Import 
Administration, International Trade Administration, U.S. Department of 
Commerce, 14th Street and Constitution Avenue, NW, Washington, DC 
20230; telephone: (202) 482-0180 or (202) 482-1690, respectively.

SUPPLEMENTARY INFORMATION:

Background

    On October 11, 2006, the Department of Commerce (the Department) 
initiated antidumping investigations of lemon juice from Argentina and 
Mexico. See Initiation of Antidumping Duty Investigations: Lemon Juice 
from Argentina and Mexico, 71 FR 61710 (October 19, 2006) (Initiation 
Notice). The Department set aside a period for all interested parties 
to raise issues regarding product coverage. The Department encouraged 
all interested parties to submit such comments within 20 days from 
publication of the initiation notice, that is, by November 8, 2006. See 
Initiation Notice; see also Antidumping Duties; Countervailing Duties; 
Final Rule, 62 FR 27296, 27323 (May 19,1997) (Final Rule).
    On November 6, 2006, the United States International Trade 
Commission (ITC) preliminarily determined that there is a reasonable 
indication that imports of lemon juice from Argentina and Mexico are 
materially injuring the U.S. industry and the ITC notified the 
Department of its findings. See Lemon Juice From Argentina and Mexico, 
Investigation Nos. 731-TA-1105 1106 (Preliminary), 71 FR 66795 
(November 16, 2006) (ITC Preliminary Report).
    On February 8, 2007, we postponed the deadline for the preliminary 
determinations under section 733(c)(1)(A) of the Tariff Act of 1930, as 
amended (the Act), by 50 days to April 19, 2007. See Postponement of 
Preliminary Determinations of Antidumping Duty Investigations: Lemon 
Juice from Argentina and Mexico, 72 FR 7606 (February 16, 2007).
    On March 30, 2007, Sunkist Growers Inc. (the petitioner) alleged 
that, in accordance with 19 CFR 351.206, critical circumstances existed 
with regard to imports of lemon juice from Argentina and Mexico.

Period of Investigation

    The period of investigation (POI) is July 1, 2005, through June 30, 
2006. This period corresponds to the four most recent fiscal quarters 
prior to the month of the filing of the petition.

Scope of Investigation

    The merchandise covered by this investigation includes certain 
lemon juice for further manufacture, with or without addition of 
preservatives, sugar, or other sweeteners, regardless of the GPL (grams 
per liter of citric acid) level of concentration, brix level, brix/acid 
ratio, pulp content, clarity, grade, horticulture method (e.g., organic 
or not), processed form (e.g., frozen or not-from-concentrate), FDA 
standard of identity, the size of the container in which packed, or the 
method of packing.
    Excluded from the scope are: (1) lemon juice at any level of 
concentration packed in retail-sized containers ready for sale to 
consumers, typically at a level of concentration of 48 GPL; and (2) 
beverage products such as lemonade that typically contain 20% or less 
lemon juice as an ingredient.
    Lemon juice is classifiable under subheadings 2009.39.6020, 
2009.31.6020, 2009.31.4000, 2009.31.6040, and 2009.39.6040 of the 
Harmonized Tariff Schedule of the United States (HTSUS). While HTSUS 
subheadings are provided for convenience and customs purposes, our 
written description of the scope of this investigation is dispositive.

Scope Comments

    In accordance with the preamble to our regulations (see Final 
Rule), we set aside a period of time for parties to raise issues 
regarding product coverage in the Initiation Notice and encouraged all 
parties to submit comments within 20 calendar days of publication of 
the Initiation Notice. We did not receive comments from any interested 
parties in the Mexico investigation. On November 1, 2006, we received 
comments from Citromax S.A.C.I. (Citromax), an interested party in the 
Argentina investigation. On November 8, 2006, the Department received 
rebuttal comments from the petitioner on the Citromax submission. As 
discussed further in the March 21, 2007, memorandum entitled ``Scope 
Issue in the Antidumping Duty Investigations on Lemon Juice from 
Argentina and Mexico'' on file in Import Administration's Central 
Records Unit (CRU), Room 1870, U.S. Department of Commerce, 14th Street 
and Constitution

[[Page 20831]]

Avenue, NW, Washington, DC 20230, we are continuing to include organic 
lemon juice in the scope of the antidumping duty investigations of 
lemon juice from Argentina and Mexico.

Respondent Selection

    Section 777A(c)(1) of the Act directs the Department to calculate 
individual weighted-average dumping margins for each known exporter and 
producer of the subject merchandise. Section 777A(c)(2) of the Act also 
gives the Department discretion to examine a reasonable number of such 
exporters and producers when it is not practicable to examine all 
exporters and producers. In order to identify the universe of 
producers/exporters in Mexico to investigate for purposes of this less-
than-fair-value investigation on lemon juice, we analyzed information 
from various sources, including data from U.S. Customs and Border 
Protection (CBP).
    Using information obtained from the petition, an internet search, 
and a request to the U.S. Embassy in Mexico in addition to CBP 
statistical information on U.S. imports of lemon juice during the POI, 
we identified three respondents accounting for approximately 95 percent 
of the POI imports from Mexico: Citrofrut Veracruz (Citrofrut), 
Citrotam Internacional S.P.R. de R.L. (Citrotam), and Coca-Cola FEMSA, 
S.A. de C.V.\1\ For a detailed analysis of our respondent-selection 
procedure, see ``Antidumping Duty Investigation on Lemon Juice from 
Mexico Respondent Selection,'' dated November 7, 2006, on file in the 
CRU.
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    \1\ In an entry of appearance, dated November 15, 2006, The 
Coca-Cola Company and a subsidiary, The Coca-Cola Export 
Corporation, Mexico Branch (collectively Coca-Cola), clarified that 
it, rather than Coca-Cola FEMSA, S.A. de C.V., was the foreign 
producer and exporter of the subject merchandise under 
investigation.
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Citrofrut

    On November 20, 2006, we issued a questionnaire to Citrofrut 
requesting that it respond to section A of the questionnaire by 
December 11, 2006. Because Citrofrut did not respond by this due date, 
we sent a letter on December 13, 2006, in which we informed the company 
that we had not received a response from it despite confirmation from 
FedEx that Citrofrut had received the questionnaire. We informed 
Citrofrut further that, if it intended to respond to the questionnaire, 
it should do so by December 20, 2006. On December 14, 2006, Citrofrut 
submitted documentation demonstrating that it exports lime juice but 
not lemon juice from Mexico to the United States. The petitioner did 
not comment.
    We find that the supporting documentation submitted by Citrofrut is 
sufficient to demonstrate its assertion that it only exports lime 
juice. On August 6, 2006, before the petition was filed, Citrofrut's 
broker in the United States filed post-summary adjustment documents 
with CBP to address the incorrect classification it had used on certain 
entries at the time of entry. We have confirmed that CBP has accepted 
the reclassification claim with respect to imports from Citrofrut. 
Therefore, we preliminarily determine that Citrofrut is no longer a 
mandatory respondent in the investigation of lemon juice from Mexico. 
If it begins to export lemon juice, its exports will be subject to the 
all-others cash-deposit rate.

Use of Adverse Facts Available

    For the reasons discussed below, we determine that the use of 
adverse facts available (AFA) is appropriate for the preliminary 
determination with respect to Citrotam.
A. Use of Facts Available
    Section 776(a)(2) of the Act provides that, if an interested party 
withholds information requested by the administering authority, fails 
to provide such information by the deadlines for submission of the 
information and in the form or manner requested, subject to subsections 
(c)(1) and (e) of section 782 of the Act, significantly impedes a 
proceeding under this title, or provides such information but the 
information cannot be verified as provided in section 782(i), the 
administering authority shall use, subject to section 782(d) of the 
Act, facts otherwise available in reaching the applicable 
determination. Section 782(d) of the Act provides that, if the 
administering authority determines that a response to a request for 
information does not comply with the request, the administering 
authority shall promptly inform the responding party and provide an 
opportunity to remedy the deficient submission. Section 782(e) of the 
Act states further that the Department shall not decline to consider 
submitted information if all of the following requirements are met: (1) 
the information is submitted by the established deadline; (2) the 
information can be verified; (3) the information is not so incomplete 
that it cannot serve as a reliable basis for reaching the applicable 
determination; (4) the interested party has demonstrated that it acted 
to the best of its ability; (5) the information can be used without 
undue difficulties. On November 7, 2006, we mailed a package to 
Citrotam via Federal Express (FedEx) containing a copy of the 
respondent-selection memorandum and a request for model-match comments. 
Based on information we found on the internet we addressed the package 
to Citrotam's general manager (GM). FedEx reported that it was not able 
to deliver the package to Citrotam because it had been told that the 
company had moved from the location for which we had provided an 
address. We continued our efforts to locate Citrotam, including working 
with the U.S. Embassy in Mexico City, as well as obtaining contact 
information for Citrotam from the Embassy of Mexico in Washington, DC. 
We obtained information indicating that Citrotam is out of business and 
has been replaced by a new firm, Productos Naturales de Citricos 
(Pronacit), which may be using the former location of Citrotam to do 
business and has the same GM as Citrotam.
    On November 21, 2006, after many attempts, when we finally 
contacted the GM, he confirmed that the new name for Citrotam is 
Pronacit. He also confirmed to the Embassy of Mexico in Washington, DC, 
that Citrotam had changed its name to Pronacit. See e-mail message 
dated December 12, 2006, attached to the Memorandum to the File 
entitled ``Efforts to Contact Citrotam Internacional, S.P.R. De R.L.,'' 
dated February 20, 2007 (Citrotam Memo). As discussed in detail in the 
Citrotam Memo, we made additional efforts to contact the GM to obtain 
an address for Pronacit. When FedEx was unable to deliver the package 
to the address provided by the GM to the Embassy of Mexico, we 
attempted to contact the GM again and spoke with the GM's assistant. On 
January 12, 2007, at the suggestion of the GM's assistant, we sent a 
letter to the assistant's residence containing questions pertaining to 
successor-in-interest status, as well as our antidumping duty 
questionnaire and other documents requesting that Citrotam/Pronacit 
respond by January 26, 2007. We confirmed that the package was 
delivered to the assistant's residence on January 16, 2007. We have 
received no response. See Citrotam Memo.
    Citrotam/Pronacit failed to respond to our detailed requests for 
information regarding successorship. Pursuant to section 776(a) of the 
Act, we find that Citrotam/Pronacit withheld information that we 
requested, failed to provide such information by the deadlines for the 
submission of the information or in the form and manner requested, 
subject to subsections (c)(1) and (e) of section 782, and significantly 
impeded a

[[Page 20832]]

proceeding under this title. Therefore, we are resorting to the use the 
facts otherwise available in reaching the applicable determination. We 
preliminarily find that the facts available, including statements from 
the GM, U.S. Embassy officials in Mexico, and Embassy of Mexico 
officials, support the conclusion that Pronacit is the successor to 
Citrotam. Moreover, because Citrotam/Pronacit failed to respond to any 
of our requests for information, we are relying on facts otherwise 
available to assign a dumping margin to Citrotam/Pronacit.
B. Application of Adverse Inferences for Facts Available
    In selecting from among the facts otherwise available, section 
776(b) of the Act provides that, if the administering authority finds 
that an interested party has failed to cooperate by not acting to the 
best of its ability to comply with a request for information from the 
administering authority, in reaching the applicable determination under 
this title, the administering authority may use an inference adverse to 
the interests of that party in selecting from among the facts otherwise 
available. See, e.g., Notice of Preliminary Determination of Sales at 
Less Than Fair Value and Postponement of Final Determination: Certain 
Circular Welded Carbon-Quality Line Pipe From Mexico, 69 FR 59892 
(October 6, 2004); see also Notice of Preliminary Determination of 
Sales at Less Than Fair Value, Postponement of Final Determination, and 
Affirmative Preliminary Determination of Critical Circumstances in 
Part: Prestressed Concrete Steel Wire Strand From Mexico, 68 FR 42378 
(July 17, 2003).
    Adverse inferences are appropriate ``to ensure that the party does 
not obtain a more favorable result by failing to cooperate than if it 
had cooperated fully.'' See Statement of Administrative Action 
accompanying the Uruguay Round Agreements Act, H. Doc. No. 103-316, at 
870 (1994) (SAA). Furthermore, ``affirmative evidence of bad faith, or 
willfulness, on the part of a respondent is not required before the 
Department may make an adverse inference.'' See Final Rule.
    Because we have preliminarily determined under section 776(a) of 
the Act that Pronacit is the successor to Citrotam and because, in 
refusing to respond to our requests for information, Citrotam/Pronacit 
has failed to cooperate to the best of its ability, we find that the 
application of an AFA rate for Citrotam/Pronacit is warranted in this 
preliminary determination.
    The Department finds that Citrotam/Pronacit failed to cooperate to 
the best of its ability because it continued to be non-responsive 
despite numerous attempts to obtain information. See Citrotam Memo. 
Consequently, the Department has preliminarily determined that, in 
selecting from among the facts otherwise available, an adverse 
inference is warranted. See section 776(b) of the Act; see also Notice 
of Final Determination of Sales at Less than Fair Value: Circular 
Seamless Stainless Steel Hollow Products from Japan, 65 FR 42985 (July 
12, 2000), where the Department applied total AFA because the 
respondents failed to respond to the antidumping questionnaire.
    If, however, within 30 days after issuance of this preliminary 
determination, Pronacit is able to demonstrate on the record of the 
investigation that it is not the successor to Citrotam and cooperates 
fully during the remainder of the investigation, the Department may 
reconsider this issue for purposes of the final determination.
C. Selection of Information Used as Facts Available
    Where the Department applies AFA because a respondent failed to 
cooperate by not acting to the best of its ability to comply with a 
request for information, section 776(b) of the Act authorizes the 
Department to rely on information derived from the petition, a final 
determination, a previous administrative review, or other information 
placed on the record. See also 19 CFR 351.308(c) and the SAA at 829-
831. In this case, because we are unable to calculate a margin for 
Citrotam/Pronacit and because an adverse inference is warranted, we 
have assigned to Citrotam/Pronacit the highest product-specific margin, 
205.37 percent, which we have calculated in this investigation based on 
the data reported by a respondent.

Date of Sale

    Section 351.401(i) of the Department's regulations states that the 
Department will normally use the date of invoice, as recorded in the 
producer's or exporter's records kept in the ordinary course of 
business, as the date of sale. The Department may use a date other than 
the date of invoice if the alternative better reflects the date on 
which the material terms of sales (e.g., price and quantity) are 
established.
    Coca-Cola stated in its responses that the essential terms of sale 
did not change once it accepted a purchase order but indicated that 
sometimes it received the purchase order after shipment had occurred. 
In its U.S. sales database, Coca-Cola reported sales based on invoice 
dates during the POI and, when shipment dates preceded invoicing, on 
shipment dates. Based on its comment that the essential terms of sale 
do not change once a purchase order is accepted, we asked Coca-Cola to 
report sales based on the purchase-order date or, when a shipment 
preceded the purchase-order date, the shipment date as date of sale. 
Because we did not receive this information in time for inclusion in 
this preliminary determination, we have used Coca-Cola's reported 
invoice date or, where the shipment preceded invoicing, the shipment 
date as the date of sale for the preliminary determination.
    We will examine the information submitted by Coca-Cola with respect 
to its purchase order; we will also examine this issue at verification 
and incorporate our findings in our analysis for the final 
determination.

Fair-Value Comparisons

    To determine whether Coca-Cola's sales of lemon juice from Mexico 
to the United States were made at less than fair value during the POI, 
we compared the export price or constructed export price (CEP) to 
normal value, as described in the ``U.S. Price'' and ``Normal Value'' 
sections of this notice. In accordance with section 777A(d)(1)(A)(i) of 
the Act, we compared the weighted-average export prices and CEPs to 
normal value which, in this case, is constructed value (CV). In our 
comparisons, we offset the average-to-average comparisons of U.S prices 
and constructed values by any non-dumped comparisons. This approach 
comports with the methodology for investigations that we set forth in 
Antidumping Proceedings: Calculation of the Weighted-Average Dumping 
Margin During an Antidumping Investigation; Final Modification, 71 FR 
77722 (December 27, 2006).

U.S. Price

    Section 772(a) of the Act defines export price as the price at 
which the subject merchandise is first sold (or agreed to be sold) 
before the date of importation by the producer or exporter outside the 
United States to an unaffiliated purchaser for exportation to the 
United States, as adjusted under subsection (c). During the POI, Coca-
Cola produced and sold subject merchandise to the first unaffiliated 
purchaser in the United States prior to importation. For sales of this 
merchandise, we have applied the export-price methodology.

[[Page 20833]]

    Section 772(b) of the Act defines CEP as the price at which the 
subject merchandise is first sold (or agreed to be sold) in the United 
States before or after the date of importation 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). In 
addition to export-price sales, Coca-Cola also had CEP sales because it 
sold some subject merchandise to the first unaffiliated purchaser in 
the United States after the date of importation of the merchandise. 
Thus, we have applied the CEP methodology to these sales.
    We based export price and CEP on the packed price to unaffiliated 
purchasers in the United States. We made deductions, as appropriate, 
for billing adjustments. We also made deductions for any movement 
expenses in accordance with section 772(c)(2)(A) of the Act. 
Accordingly, we made deductions for foreign inland freight from the 
processing plant to the Mexican border and brokerage expenses incurred 
in Mexico for all sales. For CEP sales, we also made deductions for 
U.S. brokerage expenses, U.S. warehousing expenses, and inland freight 
from the central warehouse to the point of distribution.
    In accordance with section 772(d)(1) of the Act and the SAA at 823-
824, we calculated the CEP further by deducting selling expenses 
associated with economic activities occurring in the United States, 
which consisted of credit expenses. In accordance with section 
772(d)(1) of the Act, we also deducted indirect selling expenses 
associated with economic activities occurring in the United States, 
which consisted of inventory carrying costs and the profit allocated to 
expenses deducted under section 772(d)(1) in accordance with sections 
772(d)(3) and 772(f) of the Act. Because Coca-Cola reported expenses 
incurred on U.S. but not home-market sales, we calculated a CEP profit 
rate based on the expense information provided in its 2005 financial 
statement for sales of merchandise in all markets, pursuant to section 
772(f)(2)(C)(iii) of the Act. We applied this rate to those selling 
expenses associated with economic activities occurring in the United 
States to obtain the profit amount we deducted from the sales price.
    During the POI, Coca-Cola sold lemon juice to a U.S. affiliate that 
further processed the merchandise into beverage or beverage-base 
products in the United States prior to sale to unaffiliated customers. 
Coca-Cola requested that it not be required to respond to section E of 
our questionnaire concerning its further-processed merchandise and 
submitted data to support its claim that the U.S. value added for such 
sales is likely to exceed substantially the value of the imported 
subject merchandise. After reviewing its request, we found that the 
value added in the United States is likely to exceed substantially the 
value of the subject merchandise and that there is a sufficient 
quantity of U.S. sales of non-further-processed merchandise to provide 
a reasonable basis for comparison to normal value. Accordingly, we have 
implemented the special rule for value-added sales pursuant to section 
772(e) of the Act and have not included the sales of further-processed 
merchandise in our margin calculations. See Memorandum from Minoo 
Hatten to Laurie Parkhill regarding the reporting of further-
manufactured merchandise, dated March 19, 2007.

Normal Value

A. Home-Market Viability and Comparison-Market Selection
    In order to determine whether there was a sufficient volume of 
sales in the home market to serve as a viable basis for calculating 
normal value (i.e., the aggregate volume of home-market sales of the 
foreign like product is equal to or greater than five percent of the 
aggregate volume of U.S. sales), we compared Coca-Cola's volume of 
home-market sales of the foreign like product to its volume of U.S. 
sales of the subject merchandise in accordance with section 
773(a)(1)(C) of the Act. Because the volume of its home-market sales 
did not meet the five-percent threshold, we found that Coca-Cola's home 
market was not viable for price-comparison purposes. Moreover, Coca-
Cola did not sell the foreign like product to any other country during 
the POI. Consequently, pursuant to section 773(a)(4) of the Act, we 
have based normal value on CV for all sales.
B. Level of Trade
    As discussed in the ``Calculation of Normal Value Based on 
Constructed Value'' section below, we based CV selling expenses and 
profit on Coca-Cola's home-market sales of orange juice during the POI 
and CV general and administrative (GNA) expenses on its 2005 home-
market sales of soft-drink concentrates. Coca-Cola has not provided 
level-of-trade information on any of its home-market sales and, thus, 
the record has insufficient information for us to perform a level-of-
trade analysis for this preliminary determination.
C. Calculation of Normal Value Based on Constructed Value
    We calculated CV in accordance with section 773(e) of the Act, 
which states that CV shall be based on the sum of a respondent's cost 
of materials and fabrication for the subject merchandise, plus amounts 
for selling, GNA expenses, profit, and U.S. packing costs. We relied on 
the submitted CV information for Coca-Cola except in certain instances. 
First, we have determined for the preliminary determination that lemon 
juice and lemon oil are co-products in Coca-Cola's processing of 
lemons. Thus, we have revised Coca-Cola's reported cost of manufacture 
for lemon juice to include a portion of the lemon-purchase costs and a 
portion of the common lemon-processing costs incurred before the split-
off point in the production of lemon juice and lemon oil. In addition, 
we have revised Coca-Cola's reported costs for the production of lemon 
juice to include an allocable portion of the company's GNA expenses. 
For further discussion of these adjustments, see the Memorandum to Neal 
Halper from Mark Todd, ``Cost of Production and Constructed Value 
Calculation Adjustments for the Preliminary Determination,'' dated 
April 19, 2007.
    Because we have determined for purposes of this preliminary 
determination that Coca-Cola does not have a viable home market or 
third-country market, we have calculated Coca-Cola's selling expenses 
and profit based on section 773(e)(2)(B)(i) of the Act, which states 
that selling expenses and profit may be calculated based on ``actual 
amounts incurred by the specific exporter or producer. . . in 
connection with the production and sale, for consumption in the foreign 
country, of merchandise that is in the same general category of 
products as the subject merchandise.'' We have determined for the 
preliminary determination that Coca-Cola's production and sale of 
orange juice in Mexico is merchandise in the same general category of 
products as lemon juice. Thus, we have revised the CV figures for Coca-
Cola's lemon juice to include selling expenses and profit amounts that 
are based on Coca-Cola's production and sale of orange juice for 
consumption in Mexico.

Currency Conversion

    We made currency conversions into U.S. dollars in accordance with 
section 773A(a) of the Act based on exchange rates in effect on the 
dates of the U.S.

[[Page 20834]]

sales, as certified by the Federal Reserve Bank.

All-Others Rate

    Section 735(c)(5)(B) of the Act provides that, where the estimated 
weighted-average dumping margins established for all exporters and 
producers individually investigated are zero or de minimis or are 
determined entirely under section 776 of the Act, the Department may 
use any reasonable method to establish the estimated ``all others'' 
rate for exporters and producers not individually investigated. This 
provision contemplates that the Department may weight-average margins 
other than the zero, de minimis, or AFA margins to establish the all-
others rate.
    When the data does not permit the weight-averaging of such other 
margins, the SAA provides that the Department may use any other 
reasonable method. See SAA at 873. Coca-Cola is the only respondent in 
this investigation for which we have calculated a company-specific rate 
that is not based entirely on facts available. Therefore, for purposes 
of determining the ``all others'' rate and pursuant to section 
735(c)(5)(A) of the Act, we are using the dumping margin we have 
calculated for Coca-Cola as indicated in the ``Preliminary 
Determination'' section below.

Critical Circumstances

A. Citrotam/Pronacit and Coca-Cola
    On March 30, 2007, the petitioner requested that the Department 
make a finding that critical circumstances exist with respect to 
imports of lemon juice from Mexico. The petitioner alleged that there 
is a reasonable basis to believe or suspect that critical circumstances 
exist with respect to the subject merchandise.
    Since this allegation was filed earlier than the deadline for the 
preliminary determination, we must issue our preliminary critical-
circumstances determination not later than the preliminary 
determination. See 19 CFR 351.206(c)(2); see also Policy Bulletin 98/4 
regarding Timing of Issuance of Critical Circumstances Determinations, 
63 FR 55364 (October 15, 1998).
    Section 733(e)(1) of the Act provides that the Department will 
preliminarily determine that critical circumstances exist if there is a 
reasonable basis to believe or suspect that (A)(i) there is a history 
of dumping and material injury by reason of dumped imports in the 
United States or elsewhere of the subject merchandise or (ii) the 
person by whom, or for whose account, the merchandise was imported knew 
or should have known that the exporter was selling the subject 
merchandise at less than its fair value and that there was likely to be 
material injury by reason of such sales and (B) there have been massive 
imports of the subject merchandise over a relatively short period.
    In determining whether the relevant statutory criteria have been 
satisfied, the Department considered the evidence presented in the 
petitioner's March 30, 2007, submission, exporter-specific shipment 
data submitted by Coca-Cola on April 9, 2007, and the ITC Preliminary 
Report.
    To determine whether there is a history of injurious dumping of the 
merchandise under investigation, in accordance with section 
733(e)(1)(A)(i) of the Act, the Department normally considers evidence 
of an existing antidumping duty order on the subject merchandise in the 
United States or elsewhere to be sufficient. See Preliminary 
Determinations of Critical Circumstances: Steel Concrete Reinforcing 
Bars From Ukraine and Moldova, 65 FR 70696 (November 27, 2000). See 
also Notice of Preliminary Determination of Sales at Less Than Fair 
Value, Postponement of Final Determination, and Affirmative Preliminary 
Determination of Critical Circumstances in Part: Certain Lined Paper 
Products From India, 71 FR 19706 (April 17, 2006). The petitioner has 
made no statement concerning a history of dumping of lemon juice from 
Mexico. Moreover, we are not aware of any antidumping duty order on 
lemon juice from Mexico in any other country. Therefore, the Department 
finds no history of injurious dumping of lemon juice from Mexico 
pursuant to section 733(e)(1)(A)(i) of the Act.
    To determine whether the person by whom, or for whose account, the 
merchandise was imported knew or should have known that the exporter 
was selling the subject merchandise at less than its fair value, in 
accordance with section 733(e)(1)(A)(ii) of the Act, the Department 
normally considers margins of 25 percent or more for export-price sales 
or 15 percent or more for CEP transactions sufficient to impute 
knowledge of dumping. See Preliminary Determination of Sales at Less 
Than Fair Value: Certain Cut-to-Length Carbon Steel Plate from the 
People's Republic of China, 62 FR 31972, 31978 (June 11, 1997). For the 
reasons explained above, we have assigned a margin of 205.37 percent to 
Citrotam/Pronacit. Based on this margin, we have imputed importer 
knowledge of dumping for Citrotam/Pronacit. See Notice of Preliminary 
Determination of Sales at Less Than Fair Value and Affirmative 
Preliminary Determination of Critical Circumstances: Wax and Wax/Resin 
Thermal Transfer Ribbons from Japan, 68 FR 71077 (December 22, 2003) 
(TTR from Japan). With respect to Coca-Cola, because the preliminary 
dumping margin for Coca-Cola is 146.10 percent, we preliminarily 
determine that the knowledge criterion has been met.
    In determining whether there is a reasonable basis to believe or 
suspect that an importer knew or should have known that there was 
likely to be material injury by reason of dumped imports, consistent 
with section 733(e)(1)(A)(ii) of the Act, the Department normally will 
look to the preliminary injury determination of the ITC. See Notice of 
Final Determination of Sales at Less Than Fair Value: Stainless Steel 
Sheet and Strip in Coils From Japan, 64 FR 30574, 30578 (June 8, 1999) 
(Stainless Steel from Japan). The ITC preliminarily found material 
injury to the domestic industry due to imports of lemon juice from 
Mexico, which are alleged to be sold in the United States at less than 
fair value, and, on this basis, the Department may impute knowledge of 
likelihood of injury to these respondents. See ITC Preliminary Report. 
Thus, we determine that the knowledge criterion for ascertaining 
whether critical circumstances exist has been satisfied.
    Because Citrotam/Pronacit has met the first prong of the critical-
circumstances test, according to section 733(e)(1)(A)(i) of the Act we 
must examine whether imports from Citrotam/Pronacit were massive over a 
relatively short period of time. Section 733(e)(1)(B) of the Act 
provides that the Department will preliminarily determine that critical 
circumstances exist if there is a reasonable basis to believe or 
suspect that there have been massive imports of the subject merchandise 
over a relatively short period.
    Section 351.206(h)(1) of the Department's regulations provides 
that, in determining whether imports of the subject merchandise have 
been ``massive,'' the Department normally will examine the volume and 
value of the imports, seasonal trends, and the share of domestic 
consumption for which the imports accounted. In addition, 19 CFR 
351.206(h)(2) provides that an increase in imports of 15 percent during 
the ``relatively short period'' of time may be considered ``massive.''
    Section 351.206(i) of the Department's regulations defines 
``relatively short period'' as normally being the period beginning on 
the date the proceeding begins (i.e., the date on which the petition is 
filed) and ending at least

[[Page 20835]]

three months later. The Department's regulations also provide, however, 
that, if the Department finds that importers, exporters, or producers 
had reason to believe, at some time prior to the beginning of the 
proceeding, that a proceeding was likely, the Department may consider a 
period of not less than three months from that earlier time.
    Because there is no verifiable information on the record with 
respect to Citrotam/Pronacit's import volumes, we must use facts 
available in accordance with section 776(a) of the Act. Moreover, 
because Citrotam/Pronacit failed to cooperate to the best of its 
ability, pursuant to section 776(b) of the Act, we have used an adverse 
inference in applying facts available and determine that there were 
massive imports from Citrotam/Pronacit over a relatively short period. 
See TTR from Japan, 68 FR at 71077.
    Accordingly, because all of the necessary criteria have been met, 
in accordance with section 733(e)(1) of the Act, we preliminarily find 
that critical circumstances exist with respect lemon juice imported 
from Citrotam/Pronacit.
    On April 9, 2007, Coca-Cola filed monthly import data for shipments 
of subject merchandise to the United States for June 2006 through March 
2007. Coca-Cola's reported shipment data show that its volume of 
shipments of lemon juice is greater than the Department's 15-percent 
threshold for finding that imports have been massive. Coca-Cola 
contends that its increase in imports can be explained by seasonal 
trends. We have examined the information on the record and find that 
the increase in Coca-Cola's shipments during the comparison period is 
consistent with seasonal patterns related to the growing season for 
lemons and the corresponding production cycle for lemon juice. We 
analyzed import data for the relevant base and comparison periods for 
2003 through 2006 and find that shipments show a consistent pattern of 
seasonality. For a detailed discussion see memorandum from Minoo Hatten 
to Laurie Parkhill entitled ``Antidumping Duty Investigation on Lemon 
Juice From Mexico - Preliminary Determination of Critical 
Circumstances'' dated April 18, 2007. Therefore we determine that there 
were no massive imports from Coco-Cola over a relatively short period. 
We preliminarily find that critical circumstances do not exist with 
respect to lemon juice imported from Coca-Cola.
B. All Others
    It is the Department's normal practice to conduct its critical-
circumstances analysis of companies in the all-others group based on 
the experience of investigated companies. See Notice of Final 
Determination of Sales at Less Than Fair Value: Certain Steel Concrete 
Reinforcing Bars from Turkey, 62 FR 9737, 9741 (March 4, 1997), where 
the Department found that critical circumstances existed for the 
majority of the companies investigated and concluded that critical 
circumstances also existed for companies covered by the all-others 
rate. As we determined in Notice of Final Determination of Sales at 
Less Than Fair Value: Hot-Rolled Flat-Rolled Carbon-Quality Steel 
Products from Japan, 64 FR 24329 (May 6, 1999), applying that approach 
literally could produce anomalous results in certain cases. Thus, in 
deciding whether critical circumstances apply to companies covered by 
the all-others rate, the Department also considers the traditional 
critical-circumstances criteria.
    First, in determining whether there is a reasonable basis to 
believe or suspect that an importer knew or should have known that the 
exporter was selling lemon juice at less than fair value, we look to 
the all-others rate. See TTR from Japan, 68 FR at 71077. The dumping 
margin for the all-others category, 146.10 percent, is greater than the 
25-percent threshold necessary to impute knowledge of dumping 
consistent with section 733(e)(1)(A)(ii) of the Act. Second, based on 
the ITC's preliminary material-injury determination, we also find that 
importers knew or should have known that there would be material injury 
from the dumped merchandise consistent with 19 CFR 351.206. See ITC 
Preliminary Report.
    Finally, in determining whether imports from the all-others 
category have been massive, where possible, we have followed our normal 
practice of conducting the critical-circumstances analysis of companies 
in this category based on the experience of the investigated companies. 
We are unable to base our determination on our findings for Citrotam/
Pronacit because our determination for Citrotam/Pronacit was based on 
AFA. Consistent with TTR from Japan, we have not inferred adverse 
facts, that massive imports exist for all-others companies, because, 
unlike Citrotam/Pronacit, the all-others companies have not failed to 
cooperate to the best of their ability in this investigation. 
Therefore, an adverse inference with respect to shipment levels by the 
all-others companies is not appropriate.
    In this case, we have considered the experience of Coca-Cola. As 
discussed above, we preliminarily find that imports from Coca-Cola have 
not been massive over a relatively short period of time. Since our 
normal practice of conducting the critical-circumstances analysis of 
companies in the all-others category is based on the experience of the 
investigated companies, we determine that there have been no massive 
imports of lemon juice from companies in the all-others category. In 
addition, to ensure that relying upon the experience of the 
investigated companies did not cause anomalous results, we also 
reviewed the import statistics. In the case of lemon juice we are able 
to rely on information on the ITC's website because, in this 
investigation, the HTSUS categories for merchandise within the scope of 
the investigation (except for one) include only subject merchandise. 
The import statistics for Mexico support the conclusion that there have 
not been massive imports from Mexico.
    Consequently, the criteria necessary for determining affirmative 
critical circumstances with respect to the all-others category have not 
been met. Therefore, we have preliminarily determined that critical 
circumstances do not exist for imports of lemon juice from Mexico for 
companies in the all-others category.
    We will make a final determination concerning critical 
circumstances for all producers and exporters of subject merchandise 
from Mexico when we make our final antidumping determination in this 
investigation.

Verification

    As provided in section 782(i) of the Act, we intend to verify all 
information upon which we will rely in making our final determination 
for Coca-Cola.

Preliminary Determination

    We preliminarily determine that the following weighted-average 
dumping margins exist for the period July 1, 2005, through June 30, 
2006:

------------------------------------------------------------------------
                                                       Weighted-Average
                Manufacturer/Exporter                  Margin (percent)
------------------------------------------------------------------------
The Coca-Cola Export Corporation, Mexico Branch.....              146.10
Citrotam Internacional S.P.R. de R.L.(Citrotam)/                  205.37
 Productos Naturales de Citricos (Pronacit).........
All Others..........................................              146.10
------------------------------------------------------------------------

Suspension of Liquidation

    In accordance with section 733(d) of the Act, we will instruct CBP 
to suspend liquidation of all entries of lemon juice from Mexico that 
are entered, or

[[Page 20836]]

withdrawn from warehouse, for consumption on or after the date of 
publication of this notice in the Federal Register. Additionally, for 
Citrotam/Pronacit, we will instruct CBP to suspend liquidation of 
entries made on or after 90 days prior to the publication of this 
notice in accordance with section 733(e)(2) of the Act. We will 
instruct CBP to require a cash deposit or the posting of a bond equal 
to the weighted-average margin, as indicated in the chart above, as 
follows: (1) the rates for the mandatory respondents will be the rates 
we have determined in this preliminary determination; (2) if the 
exporter is not a firm identified in this investigation but the 
producer is, the rate will be the rate established for the producer of 
the subject merchandise; (3) the rate for all other producers or 
exporters will be 146.10 percent. These suspension-of-liquidation 
instructions will remain in effect until further notice.

Disclosure

    We will disclose the calculations used in our analysis to parties 
in this proceeding in accordance with 19 CFR 351.224(b).

International Trade Commission Notification

    In accordance with section 733(f) of the Act, we have notified the 
ITC of our preliminary determination of sales at less than fair value. 
If our final antidumping determination is affirmative, the ITC will 
determine whether the imports covered by that determination are 
materially injuring, or threatening material injury to, the U.S. 
industry. The deadline for the ITC's determination will be the later of 
120 days after the date of this preliminary determination or 45 days 
after the date of our final determination.

Public Comment

    Interested parties are invited to comment on the preliminary 
determination. Interested parties may submit case briefs to the 
Department no later than seven days after the date of the issuance of 
the final verification report in this proceeding. Rebuttal briefs, the 
content of which is limited to the issues raised in the case briefs, 
must be filed within five days from the deadline for the submission of 
case briefs. Executive summaries should be limited to five pages total, 
including footnotes. Further, we request that parties submitting briefs 
and rebuttal briefs provide us with a copy of the public version of 
such briefs on diskette. Section 774 of the Act provides that the 
Department will hold a hearing to afford interested parties an 
opportunity to comment on arguments raised in case or rebuttal briefs, 
provided that such a hearing is requested by an interested party. If a 
request for a hearing is made in an investigation, the hearing normally 
will be held two days after the deadline for submission of the rebuttal 
briefs at the U.S. Department of Commerce, 14th Street and Constitution 
Avenue, N.W., Washington, DC 20230. Parties should confirm by telephone 
the time, date, and place of the hearing 48 hours before the scheduled 
time. Interested parties who wish to request a hearing, or to 
participate if one is requested, must submit a written request within 
30 days of the publication of this notice. Requests should specify the 
number of participants and provide a list of the issues to be 
discussed. Oral presentations will be limited to issues raised in the 
briefs. We will make our final determination within 75 days after the 
date of this preliminary determination.
    This determination is issued and published pursuant to sections 
733(f) and 777(i)(1) of the Act.

    Dated: April 19, 2007.
Joseph A. Spetrini,
Deputy Assistant Secretaryfor Import Administration.
[FR Doc. E7-8019 Filed 4-25-07; 8:45 am]
BILLING CODE 3510-DS-S