Suspension of Antidumping Duty Investigation: Lemon Juice From Mexico, 53995-54000 [E7-18298]

Download as PDF Federal Register / Vol. 72, No. 183 / Friday, September 21, 2007 / Notices SG&A expenses are those expenses incurred for the operation of the corporation as a whole and not directly related to the manufacture of a particular product. They include corporate general and administrative expenses, financing expenses, and general research and development expenses. Additionally, direct and indirect selling expenses incurred in the HM for sales of the product under investigation are included. Such expenses are allocated to COM using a ratio of SG&A costs. mstockstill on PROD1PC66 with NOTICES Constructed Value (CV) Constructed value is equal to the sum of materials, labor and overhead (COM) and SG&A expenses plus profit in the comparison market and the cost of packing for exportation to the United States. Calculation of Suspension Agreement Normal Values Normal values (for purposes of the Agreement) are calculated by adjusting the CV and are provided for both EP and CEP transactions. In effect, any expenses uniquely associated with the covered products sold in the HM are subtracted from the CV, and any such expenses which are uniquely associated with the covered products sold in the United States are added to the CV to calculate the NV. ‘‘Export Price’’—Generally, a U.S. sale is classified as an export price sale when the first sale to an unaffiliated person occurs before the goods are imported into the United States. In cases where the foreign manufacturer knows or has reason to believe that the merchandise is ultimately destined for the United States, the manufacturer’s sale is the sale subject to review. If, on the other hand, the manufacturer sold the merchandise to a foreign trader without knowledge of the trader’s intention to export the merchandise to the United States, then the trader’s first sale to an unaffiliated person is the sale subject to review. For EP NVs, the CV is adjusted for movement costs and differences in direct selling expenses such as commissions, credit, warranties, technical services, advertising, and sales promotion. ‘‘Constructed Export Price’’—Generally, a U.S. sale is classified as a constructed export price sale when the first sale to an unaffiliated person occurs after importation. However, if the first sale to an unaffiliated person is made by a person in the United States affiliated with the foreign exporter, constructed export price applies even if the sale occurs prior to importation, unless the U.S. affiliate performs only clerical functions in connection with the sale. For CEP NVs, the CV is adjusted similar to EP sales, with differences for adjustment to U.S. and HM indirect selling expenses. Home market direct selling expenses are expenses that are incurred as a direct result of a sale. These include such expenses as commissions, advertising, discounts and rebates, credit, warranty expenses, freight costs, etc. Certain direct selling expenses are treated individually, including: —Commission expenses, i.e., payments to unaffiliated parties for sales in the HM. —Credit expenses, i.e., expenses incurred for the extension of credit to HM customers. VerDate Aug<31>2005 18:17 Sep 20, 2007 Jkt 211001 —Movement expenses, e.g., foreign inland freight and insurance expenses, warehousing, and foreign brokerage, handling and port charges. U.S. direct selling expenses are the same as HM direct selling expenses except that they are incurred for sales in the United States. Movement expenses are additional expenses associated with importation into the United States, which typically include: U.S. inland freight and insurance expenses; U.S. brokerage, handling and port charges; U.S. Customs duties, U.S. warehousing; and international freight and insurance. U.S. indirect selling expenses include general fixed expenses incurred by the U.S. sales subsidiary or affiliated exporter for sales to the United States and may also include a portion of indirect expenses incurred in the HM for export sales. The EP and CEP NVs are calculated as follows: For EP Transactions + + + = + = + + = + + + + ¥ ¥ ¥ = Direct Materials. Direct Labor. Factory Overhead. Cost of Manufacturing (COM). Home Market SG&A. Cost of Production (COP). U.S. Packing. Profit. Constructed Value. U.S. Direct Selling Expense. U.S. Commission Expense. U.S. Movement Expense. U.S. Credit Expense. HM Direct Selling Expense. HM Commission Expense.1 HM Credit Expense. NV for EP Sales. Fmt 4703 Sfmt 4703 NV for CEP Sales. 1 The Department will examine any furthermanufacturing expenses on value-added products sold to the first unaffiliated purchaser in the United States by a person affiliated with the foreign producer/exporter, and produced from subject merchandise purchased directly from that foreign producer/exporter, on a caseby-case basis and reserves the right to make adjustments to its reporting requirements and calculation methodology for these expenses. For example, in cases where a producer/exporter’s affiliate makes sales of products with significant value added to unaffiliated purchasers in the United States, or the range of such products is significant, the Department may adjust its reporting requirements and calculation methodology for the further manufacturing costs associated with the value-added products. Additionally, if the ratio of a producer/exporter’s reported sales to unaffiliated purchasers versus its sales to affiliated persons shifts over time, the Department may make further adjustments in its reporting requirements and calculation methodology for the further-manufacturing expenses associated with the value-added products. 2 If the company does not have HM commissions, HM indirect expenses are subtracted only up to the amount of the U.S. commissions. DEPARTMENT OF COMMERCE International Trade Administration [A–201–835] Suspension of Antidumping Duty Investigation: Lemon Juice From Mexico Import Administration, International Trade Administration, Department of Commerce. SUMMARY: The Department of Commerce (‘‘the Department’’) has suspended the antidumping duty investigation involving lemon juice from Mexico. The basis for this action is an agreement between the Department and The CocaCola Company and The Coca-Cola Export Corporation, Mexico Branch (collectively ‘‘Coca-Cola’’) to revise their prices to eliminate completely sales of this merchandise to the United States at less than fair value. DATES: Effective Date: September 10, 2007. AGENCY: Direct Materials. Direct Labor. Factory Overhead. Cost of Manufacturing (COM). Home Market SG&A. Cost of Production (COP). U.S. Packing. Profit. Constructed Value. U.S. Direct Selling Expense. U.S. Indirect Selling Expense. U.S. Commission Expense. U.S. Movement Expense. U.S. Credit Expense. U.S. Further-Manufacturing Expenses (if any).1 + CEP Profit. ¥ HM Direct Selling Expense. ¥ HM Commission Expense. 2 ¥ HM Credit Expense. Frm 00016 = BILLING CODE 3510–DS–P For CEP Transactions PO 00000 For CEP Transactions [FR Doc. E7–18278 Filed 9–20–07; 8:45 am] 1 If the company does not have HM commissions, HM indirect expenses are subtracted only up to the amount of the U.S. commissions. + + + = + = + + = + + + + + + 53995 FOR FURTHER INFORMATION CONTACT: Sally Gannon or James Kemp at (202) 482–0162 and (202) 482–5346, respectively, Bilateral Agreements Unit, Office of Policy, Import Administration, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue, NW., Washington, DC 20230. SUPPLEMENTARY INFORMATION: E:\FR\FM\21SEN1.SGM 21SEN1 53996 Federal Register / Vol. 72, No. 183 / Friday, September 21, 2007 / Notices mstockstill on PROD1PC66 with NOTICES Background Scope of Investigation On October 11, 2006, the Department initiated an antidumping duty investigation under section 732 of the Tariff Act of 1930, as amended (‘‘the Act’’) to determine whether imports of lemon juice from Mexico are being, or are likely to be sold in the United States at less than fair value (71 FR 61710 (October 19, 2006)). On November 3, 2007, the United States International Trade Commission (‘‘ITC’’) notified the Department of its affirmative preliminary injury determination in this case. See Lemon Juice from Argentina and Mexico, Inv. Nos. 731–TA–1105– 1106 (Preliminary) USITC Pub. No. 3891 (November 2006). On April 19, 2007, the Department preliminarily determined that lemon juice is being, or is likely to be sold in the United States at less than fair value (‘‘LTFV’’), as provided in section 733 of the Act (Notice of Preliminary Determinations of Sales at Less than Fair Value and of Critical Circumstances in Part: Lemon Juice from Mexico, 72 FR 20830 (April 26, 2007) (‘‘Preliminary Determination’’)). On May 17, 2007, the Department postponed the final determination in this investigation until no later than September 10, 2007 (Lemon Juice from Argentina and Mexico: Postponement of Final Antidumping Duty Determinations and Extension of Provisional Measures, 72 FR 28953 (May 23, 2007)). The Department and Coca-Cola initialed a proposed agreement suspending this investigation on August 10, 2007. On August 13, 2007, we invited interested parties to provide written comments on the proposed suspension agreement. On August 24, 2007, the Department also invited interested parties to provide written comments on an issue related to the draft suspension agreement with respect to purchase orders and/or long-term contracts entered into prior to September 10, 2007. In response to our requests for comment, on August 30, 2007, we received comments from petitioner Sunkist Growers Inc. and respondent Coca-Cola. We received further comments from petitioner and respondent on September 6, 2007, and again from petitioner on September 7 and 10, 2007. We have taken these comments into consideration for the final version of the suspension agreement. The Department and Coca-Cola signed the suspension agreement on September 10, 2007. For a complete description of the scope of the investigation, see Agreement Suspending the Antidumping Investigation on Lemon Juice from Mexico, Appendix A, signed September 10, 2007, attached hereto in Annex 1. VerDate Aug<31>2005 18:17 Sep 20, 2007 Jkt 211001 Suspension of Investigation The Department consulted with the parties to the proceeding and has considered the comments submitted with respect to the proposed suspension agreement. In accordance with sections 734(b) and (d) of the Act, we have determined that the agreement will completely eliminate sales at less than fair value, that the agreement is in the public interest, and that the agreement can be monitored effectively. See, Public Interest and Effective Monitoring Memorandum, dated September 10, 2007. See also, Percentage of Exports Memorandum, dated September 10, 2007. We find, therefore, that the criteria for suspension of an investigation pursuant to sections 734(b) and (d) of the Act have been met. The terms and conditions of this agreement, signed September 10, 2007, are set forth in Annex 1 to this notice. Pursuant to section 734(f)(2)(A) of the Act, the suspension of liquidation of all entries of lemon juice from Mexico entered, or withdrawn from warehouse, for consumption, as directed in the Preliminary Determination is hereby terminated. Any cash deposits on entries of lemon juice from Mexico pursuant to that suspension of liquidation shall be refunded and any bonds shall be released. This notice is published pursuant to section 734(f)(1)(A) of the Act. Dated: September 10, 2007. Michelle O’Neill, Deputy Under Secretary for International Trade. Annex 1—Agreement Suspending the Antidumping Investigation on Lemon Juice From Mexico Pursuant to section 734(b) of the Tariff Act of 1930, as amended (19 U.S.C. 1673c(b)) (the ‘‘Act’’), and 19 CFR 351.208 (the ‘‘Regulations’’), the U.S. Department of Commerce (the ‘‘Department’’) and the signatory producers/exporters of Lemon Juice from Mexico (the ‘‘Signatories’’) enter into this suspension agreement (the ‘‘Agreement’’). On the basis of this Agreement, on the effective date of this Agreement, the Department shall suspend its antidumping investigation initiated on October 19, 2006 (17 FR 61710) with respect to Lemon Juice from Mexico, subject to the terms and provisions set forth below. (A) Product Coverage: PO 00000 Frm 00017 Fmt 4703 Sfmt 4703 For purposes of this Agreement, the merchandise covered is Lemon Juice, as described in Appendix A. (B) U.S. Import Coverage: The signatory producers/exporters collectively are the producers and exporters in Mexico that accounted for substantially all (not less than 85 percent) of the subject merchandise imported into the United States, as provided in the Department’s regulations at 19 CFR 351.208(c). The Department may, at anytime during the period of the Agreement, require additional producers/ exporters in Mexico to sign the Agreement in order to ensure that not less than substantially all imports into the United States are covered by the Agreement. In reviewing the operation of the Agreement for the purpose of determining whether this Agreement has been violated or is no longer in the public interest, the Department will consider imports into the United States from all sources of the merchandise described in Section A of the Agreement. For this purpose, the Department will consider factors including, but not limited to, the following: volume of trade, pattern of trade, whether or not the reseller is an original equipment manufacturer, and the reseller’s export price (EP). (C) Basis of the Agreement: On and after the effective date of the Agreement, each signatory producer/exporter individually agrees to make any necessary price revisions to eliminate completely any amount by which the normal value (NV) of this merchandise exceeds the U.S. price of its merchandise subject to the Agreement. For this purpose, the Department will determine the NV in accordance with section 773(e) of the Act and U.S. price in accordance with section 772 of the Act. For details of the Department’s calculation methodology under this Agreement, see Appendices B and C. (1) For the period from the effective date of this Agreement through the release of the first NVs, each signatory producer/exporter agrees not to sell its merchandise subject to this Agreement in the United States. However, during this period and subsequent periods, as relevant, a signatory producer/exporter may proceed with deliveries of subject merchandise made pursuant to purchase orders or long-term contracts entered into prior to September 10, 2007, if the Department determines, in accordance with its regulations, that the signatory producer’s/exporter’s appropriate date of sale is the date of the purchase order or long-term contract (see Section I(4) below). At any time, should the Department determine that the purchase order or longterm contract date was not the appropriate date of sale for a signatory producer/exporter making such deliveries, the Department may consider such deliveries to be in violation of this Agreement (see Section F below). Any signatory producer/exporter making such deliveries under this Agreement must provide a one-time report to the Department, within 30 days of these deliveries having been completed, which contains a listing of the contract or purchase order dates, the delivery quantities, the dates of delivery, the entry dates, and the prices at which the subject merchandise was sold. This E:\FR\FM\21SEN1.SGM 21SEN1 Federal Register / Vol. 72, No. 183 / Friday, September 21, 2007 / Notices mstockstill on PROD1PC66 with NOTICES information will be subject to verification in accordance with Section D(4) of this Agreement. (2) For all sales occurring on or after the date of issuance of the first NVs, through June 30, 2008 (‘‘Interim Period’’), each signatory producer/exporter issued NVs by the Department agrees not to sell its merchandise subject to this Agreement to any purchaser in the United States at prices that are less than the NVs of the merchandise, as determined by the Department on the basis of the sales and cost information submitted by the signatory producer/exporter in the course of the underlying antidumping duty investigation. The final NVs for a signatory producer/exporter during this Interim Period shall be issued within 14 days after the preliminary NVs are issued pursuant to Section E(2) of this Agreement.1 (3) For all sales occurring after the Interim Period, each signatory producer/exporter issued NVs by the Department agrees not to sell its merchandise subject to this Agreement to any purchaser in the United States at prices that are less than the NVs of the merchandise, as determined by the Department on the basis of information submitted to the Department not later than the dates specified in Section D of this Agreement and provided to the signatory producer/exporter no later than June 1 of each year. These NVs shall apply to sales occurring during the annual period (i.e., July through June) beginning 30 days following the date on which the Department provides the NVs, as stated in this paragraph. (D) Monitoring: Each signatory producer/exporter will supply to the Department all information that the Department decides is necessary to ensure that the producer/exporter is in full compliance with the terms of the Agreement. As explained below, the Department will provide each signatory producer/exporter a detailed request for information and prescribe a required format and method of data compilation, not later than the beginning of each reporting period.2 1 The issuance of the NVs for any given signatory may be delayed depending on the following: (1) Issues related to the underlying antidumping duty investigation; (2) to allow sufficient time for signatories to respond to the Department’s request for sales and cost data; and/or (3) to resolve issues raised in comments from interested parties or by the Department. In accordance with section 773(f) of the Act, the Department will examine relevant prices and costs and, for any sales period, may disregard particular prices or costs when the prices are not in the ordinary course of trade, the costs are not in accordance with the generally accepted accounting principles, the costs do not reasonably reflect the costs associated with the production and sale of the merchandise, or in other situations provided for in the Act or the Department’s regulations. Examples of possible areas in which adjustments may be necessary include, but are not limited to, costs related to energy, depreciation, transactions among affiliates, barter transactions, as well as items that are not recognized by the home country’s generally accepted accounting principles. 2 As noted in Section C(2) of this Agreement, the first NVs issued for certain signatory producer/ exporters may be based on sales and cost information submitted by those signatories in the underlying antidumping duty investigation, and the resulting NVs issued will apply to sales occurring VerDate Aug<31>2005 18:17 Sep 20, 2007 Jkt 211001 (1) Sales Information: The Department will require each producer/exporter to report, in electronic form in the prescribed format and using the prescribed method of data compilation, each sale of the merchandise subject to the Agreement, either directly or indirectly to unaffiliated purchasers in the United States, as well as sales in the comparison market (home or third country market, as appropriate), including each adjustment applicable to each sale, as specified by the Department. The first report of sales data, pursuant to Section C(3) of this Agreement, shall be submitted to the Department, in electronic form (e.g., on diskette, zip disk, or CD ROM) in the prescribed format and using the prescribed method of data compilation, not later than October 1, 2007, and shall contain the specified sales information covering the period July 1, 2006, through June 30, 2007. Subsequent reports of sales data shall be submitted to the Department not later than October 1 of each year, and each report shall contain the specified sales information for the annual period ending on June 30 of that year, except that if the Department receives information that a possible violation of the Agreement may have occurred, the Department may request sales data on a more frequent basis. (2) Cost Information: Producers/exporters must request NVs for all subject merchandise that will be sold in the United States. For those products which the producer/exporter is requesting NVs, the Department will require each producer/ exporter to report, in the prescribed format and using the prescribed method of data compilation, the following: Its actual cost of manufacturing; selling, general and administrative (SG&A) expenses; and profit data on an annual basis. As indicated in Appendix B to this Agreement, profit will be reported by the producers/exporters on an annual basis. Each such producer/exporter also must report anticipated increases in production costs in the annual period in which the information is submitted resulting from factors such as anticipated changes in production yield, changes in production process, changes in production quantities or changes in production facilities. The first report of cost data, pursuant to Section C(3) of this Agreement, shall be submitted to the Department not later than October 15, 2007, and shall contain the specified cost data covering the period July 1, 2006, through June 30, 2007. Each subsequent report shall be submitted to the Department not later than October 15 of each year, and each report shall contain the specified information for the annual period ending on June 30 of that year. (3) Special Adjustment of Normal Value: If the Department determines that the NV it determined for a previous annual period was erroneous because the reported costs for that period were inaccurate or incomplete, or for any other reason, the Department may adjust NV in a subsequent period or periods, unless the Department determines that Section F of the Agreement applies. between the issuance date of the NVs and June 30, 2008 (Interim Period). PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 53997 (4) Verification: Each producer/exporter agrees to permit full verification of all cost and sales information annually, or more frequently, as the Department deems necessary. (5) Bundling or Other Arrangements: Producers/exporters agree not to circumvent the Agreement. In accordance with the dates set forth in Section D(1) of this Agreement, producers/exporters will submit a written statement to the Department certifying that the sales reported herein were not, or are not part of or related to, any bundling arrangement, on-site processing arrangement, discounts/free goods/financing package, swap or other exchange where such arrangement is designed to circumvent the basis of the Agreement. Where there is reason to believe that such an arrangement does circumvent the basis of the Agreement, the Department will request producers/exporters to provide within 15 days all particulars regarding any such arrangement, including, but not limited to, sales information pertaining to covered and non-covered merchandise that is manufactured or sold by producers/ exporters. The Department will accept written comments, not to exceed 30 pages, from all parties no later than 15 days after the date of receipt of such producer/exporter information. If the Department, after reviewing all submissions, determines that such an arrangement circumvents the basis of the Agreement, it may, as it deems most appropriate, utilize one of two options: (1) The amount of the effective price discount resulting from such arrangement shall be reflected in the NV in accordance with Section D(3) of this Agreement, or (2) the Department shall determine that the Agreement has been violated and take action according to the provisions under Section F of this Agreement. (6) Rejection of Submissions: The Department may reject any information submitted after the deadlines set forth in this section or any information which it is unable to verify to its satisfaction. If information is not submitted in a complete and timely fashion, or is not fully verifiable, the Department may calculate the NV, and/ or U.S. price, based on facts otherwise available, as it determines appropriate, unless the Department determines that Section F of this Agreement applies. (E) Disclosure and Comment: (1) The Department may make available to representatives of each interested party to the proceeding, under appropriately drawn administrative protective orders, business proprietary information submitted to the Department during the reporting period as well as the results of its analysis under section 777 of the Act. (2) For sales during the Interim Period, the Department will disclose to each producer/ exporter being issued NVs the preliminary results and methodology of the Department’s calculations of the NVs on or after the effective date of this Agreement.3 At that 3 The Department will endeavor to issue the preliminary NVs for the Interim Period within five E:\FR\FM\21SEN1.SGM Continued 21SEN1 mstockstill on PROD1PC66 with NOTICES 53998 Federal Register / Vol. 72, No. 183 / Friday, September 21, 2007 / Notices time, the Department may also make available such information to the interested parties to the proceeding in accordance with this section. (3) Not later than May 2 of each ensuing annual sales period, the Department will disclose to each producer/exporter being issued NVs the preliminary results and methodology of the Department’s calculations of the NVs. At that time, the Department may also make available such information to the interested parties to the proceeding, in accordance with this section. (4) Not later than 7 days after the dates of disclosure under Sections E(2) and E(3), respectively, of this Agreement, the parties to the proceeding may submit written comments to the Department, not to exceed 15 pages. After reviewing these submissions, the Department will provide to each producer/exporter its final NVs, as provided in Sections C(2) and C(3), respectively, of this Agreement. In addition, the Department may provide such information to interested parties, as specified in this section. (F) Violations of the Agreement: If the Department determines that the Agreement is being or has been violated or no longer meets the requirements of sections 734(b) or (d) of the Act, the Department shall take action it determines appropriate under section 734(i) of the Act and the regulations. (G) Other Provisions: In entering into the Agreement, the signatory producers/exporters do not admit that any sales of merchandise subject to the Agreement have been made at less than fair value. (H) Termination or Withdrawal: Termination of the suspended investigation will be considered in accordance with the five-year review provisions of section 351.218 of the Department’s regulations. Any producer/exporter may withdraw from the Agreement at any time upon notice to the Department. Withdrawal shall be effective 60 days after such notice is given to the Department. Upon withdrawal, the Department shall follow the procedures outlined in section 734(i)(1) of the Act. (I) Definitions: For purposes of the Agreement, the following definitions apply: (1) ‘‘U.S. price’’ means the export price or constructed export price at which merchandise is sold by the producer or exporter to the first unaffiliated person in the United States, including the amount of any discounts, rebates, price protection or ship and debit adjustments, and other adjustments affecting the net amount paid or to be paid by the unaffiliated purchaser, as determined by the Department under section 772 of the Act. (2) ‘‘Normal value’’ means the constructed value (CV) of the merchandise, as determined by the Department under section 773 of the Act and the corresponding sections of the Department’s regulations, and as adjusted in accordance with Appendix B to this Agreement. days after the effective date of this Agreement, subject to the possible constraints noted in footnote #1 of Section C(2) of this Agreement. VerDate Aug<31>2005 18:17 Sep 20, 2007 Jkt 211001 (3) ‘‘Producer/Exporter’’ means (1) the foreign manufacturer or producer, (2) the foreign producer or reseller which also exports, and (3) the affiliated person by whom or for whose account the merchandise is imported into the United States, as defined in section 771(28) of the Act. (4) ‘‘Date of sale’’ means the date of the invoice as recorded in the exporter’s or producer’s records kept in the ordinary course of business, unless the Department determines that a different date better reflects the date on which the exporter or producer establishes the material terms of sale, as determined by the Department under its regulations. The effective date of this Agreement is September 10, 2007. For Mexican Producers/Exporters: Dated: September 10, 2007. Mark P. Lunn, The Coca-Cola Company and The Coca-Cola Export Corporation, Mexico Branch. For U.S. Department of Commerce: Dated: September 10, 2007. Michelle O’Neill, Deputy Under Secretary for Import Administration. Appendix A: Product Coverage For purposes of this Agreement, the merchandise covered 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 Agreement is dispositive. Appendix B: Principles of Cost General Framework The cost information reported to the Department that will form the basis of the NV calculations for purposes of the Agreement must be: 4 • Comprehensive in nature and based on a reliable accounting system (i.e., a system based on well-established standards that can be tied to the audited financial statements); 4 See footnote # 1 in Section C(2) of this Agreement. PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 • Calculated on an annual weightedaverage basis of the plants or cost centers manufacturing the product; • Based on fully-absorbed costs of production, including any downtime; • Valued in accordance with generally accepted accounting principles; and • Reflective of appropriately allocated common costs so that the costs necessary for the manufacturing of the product are not absorbed by other products. Additionally, a separate figure should be reported for each major cost component making up the cost of production. Cost of Manufacturing (COM) Costs of manufacturing are reported by major cost category and for major stages of production. Weighted-average costs are used for a product that is produced at more than one facility, based on the product’s cost at each facility and relative production quantities. Direct materials costs include the acquisition costs of all materials that are identified as part of the finished product and may be traced to the finished product in an economically feasible way. In contrast to indirect materials, direct materials are applied and assigned directly to a finished product. Direct materials costs should include transportation charges, import duties, and other expenses normally associated with obtaining the materials that become an integral part of the finished product. Direct labor costs are the labor costs identified with a specific product. These costs are not allocated among products except when two or more products are produced at the same cost center. Direct labor costs should include salary, bonus and overtime pay, training expenses, and all fringe benefits. Any contracted-labor expense should reflect the actual billed cost. Variable manufacturing overhead costs include those production costs, other than direct materials or direct labor, that generally vary in total with changes in the volume of merchandise produced at a given level of operations. Variable manufacturing overhead costs may include indirect materials (e.g., supplies used in the manufacturing process), indirect labor (e.g. supervisory labor paid on an hourly basis), utilities (e.g., energy), and other variable overhead costs. Because variable overhead costs are typically incurred for an entire production line or factory, the costs must be allocated to the products produced using a reasonable basis. Fixed manufacturing overhead costs include those production costs that generally do not vary in total with changes in the volume of merchandise produced at a given level of operations. Fixed manufacturing overhead costs may include the costs incurred for building or equipment rental, depreciation, supervisory labor paid on a salary basis, plant property taxes, and factory administrative costs. In addition, fixed manufacturing overhead costs include research and development (R&D) costs which relate specifically to the subject merchandise. Cost of Production (COP) COP is equal to the sum of direct materials, direct labor, variable manufacturing E:\FR\FM\21SEN1.SGM 21SEN1 Federal Register / Vol. 72, No. 183 / Friday, September 21, 2007 / Notices overhead, and fixed manufacturing overhead (i.e. COM) plus SG&A expenses in the home market (HM). SG&A expenses are those expenses incurred for the operation of the corporation as a whole and not directly related to the manufacture of a particular product. They include corporate general and administrative expenses, financing expenses, and general research and development expenses. Additionally, direct and indirect selling expenses incurred in the HM for sales of the product under investigation are included. Such expenses are allocated to COM using a ratio of SG&A costs. mstockstill on PROD1PC66 with NOTICES Constructed Value (CV) Constructed value is equal to the sum of materials, labor and overhead (COM) and SG&A expenses plus profit in the comparison market and the cost of packing for exportation to the United States. Calculation of Suspension Agreement Normal Values Normal values (for purposes of the Agreement) are calculated by adjusting the CV and are provided for both EP and CEP transactions. In effect, any expenses uniquely associated with the covered products sold in the HM are subtracted from the CV, and any such expenses which are uniquely associated with the covered products sold in the United States are added to the CV to calculate the NV. ‘‘Export Price’’—Generally, a U.S. sale is classified as an export price sale when the first sale to an unaffiliated person occurs before the goods are imported into the United States. In cases where the foreign manufacturer knows or has reason to believe that the merchandise is ultimately destined for the United States, the manufacturer’s sale is the sale subject to review. If, on the other hand, the manufacturer sold the merchandise to a foreign trader without knowledge of the trader’s intention to export the merchandise to the United States, then the trader’s first sale to an unaffiliated person is the sale subject to review. For EP NVs, the CV is adjusted for movement costs and differences in direct selling expenses such as commissions, credit, warranties, technical services, advertising, and sales promotion. ‘‘Constructed Export Price’’—Generally, a U.S. sale is classified as a constructed export price sale when the first sale to an unaffiliated person occurs after importation. However, if the first sale to an unaffiliated person is made by a person in the United States affiliated with the foreign exporter, constructed export price applies even if the sale occurs prior to importation, unless the U.S. affiliate performs only clerical functions in connection with the sale. For CEP NVs, the CV is adjusted similar to EP sales, with differences for adjustment to U.S. and HM indirect selling expenses. Home market direct selling expenses are expenses that are incurred as a direct result of a sale. These include such expenses as commissions, advertising, discounts and rebates, credit, warranty expenses, freight costs, etc. Certain direct selling expenses are treated individually, including: —Commission expenses, i.e., payments to unaffiliated parties for sales in the HM. VerDate Aug<31>2005 18:17 Sep 20, 2007 Jkt 211001 —Credit expenses, i.e., expenses incurred for the extension of credit to HM customers. —Movement expenses, e.g., foreign inland freight and insurance expenses, warehousing, and foreign brokerage, handling and port charges. U.S. direct selling expenses are the same as HM direct selling expenses except that they are incurred for sales in the United States. Movement expenses are additional expenses associated with importation into the United States, which typically include: U.S. inland freight and insurance expenses; U.S. brokerage, handling and port charges; U.S. Customs duties, U.S. warehousing; and international freight and insurance. U.S. indirect selling expenses include general fixed expenses incurred by the U.S. sales subsidiary or affiliated exporter for sales to the United States and may also include a portion of indirect expenses incurred in the HM for export sales. The EP and CEP NVs are calculated as follows: For EP transactions + + + = + = + + = + + + + ¥ ¥ ¥ = Direct Materials. Direct Labor. Factory Overhead. Cost of Manufacturing (COM). Home Market SG&A. Cost of Production (COP). U.S. Packing. Profit. Constructed Value. U.S. Direct Selling Expense. U.S. Commission Expense. U.S. Movement Expense. U.S. Credit Expense. HM Direct Selling Expense. HM Commission Expense. 1 HM Credit Expense. NV for EP Sales. For CEP transactions Direct Materials. Direct Labor. Factory Overhead. Cost of Manufacturing (COM). Home Market SG&A. Cost of Production (COP). U.S. Packing. Profit. Constructed Value. U.S. Direct Selling Expense. U.S. Indirect Selling Expense. U.S. Commission Expense. U.S. Movement Expense. U.S. Credit Expense. U.S. Further-Manufacturing Expense (if any).1 + CEP Profit. ¥ HM Direct Selling Expense. ¥ HM Commission Expense.2 ¥ HM Credit Expense. PO 00000 Frm 00020 Fmt 4703 Sfmt 4703 For CEP transactions = NV for CEP Sales. 1 The Department will examine any furthermanufacturing expenses on value-added products sold to the first unaffiliated purchaser in the United States by a person affiliated with the foreign producer/exporter, and produced from subject merchandise purchased directly from that foreign producer/exporter, on a caseby-case basis and reserves the right to make adjustments to its reporting requirements and calculation methodology for these expenses. For example, in cases where a producer/exporter’s affiliate makes sales of products with significant value added to unaffiliated purchasers in the United States, or the range of such products is significant, the Department may adjust its reporting requirements and calculation methodology for the further manufacturing costs associated with the value-added products. Additionally, if the ratio of a producer/exporter’s reported sales to unaffiliated purchasers versus its sales to affiliated persons shifts over time, the Department may make further adjustments in its reporting requirements and calculation methodology for the further-manufacturing expenses associated with the value-added products. 2 If the company does not have HM commissions, HM indirect expenses are subtracted only up to the amount of the U.S. commissions. Appendix C: Cost Allocation and NV Methodology 1 If the company does not have HM commissions, HM indirect expenses are subtracted only up to the amount of the U.S. commissions. + + + = + = + + = + + + + + + 53999 The following provides clarification regarding the methodologies the Department will use in calculating normal values under this Agreement: (A) For The Coca-Cola Company and The Coca-Cola Export Corporation, Mexico Branch (collectively, ‘‘Coexport’’): (1) Cost Allocation for Life of Agreement: Throughout the life of this Agreement, to allocate common costs, the Department will allocate 8.5 percent of the reported lemon fruit costs and common lemon processing costs to lemon juice and 91.5 percent of these same costs to lemon oil for purposes of calculating Coexport’s NVs, as detailed in Appendix B to this Agreement. (2) All Other Costs and Sales Expenses for Interim Period NVs: For the Interim Period only of this Agreement, the Department will use all other reported costs and sales expenses, as adjusted by the Department, where appropriate, for the preliminary determination in the underlying antidumping duty investigation, for purposes of calculating Coexport’s NVs, as detailed in Appendix B to this Agreement. (3) Monitoring of Value-Added Products after the Interim Period: In addition to the stipulations noted in footnote #1 to the calculation for CEP transactions in Appendix B to this Agreement, the Department shall normally choose between two to three products with significant value added, as reported by Coexport pursuant to Section D(1) during each NV cycle, for examination and monitoring of the related costs and sales expenses. For such value-added products, the Department shall set CEP profit to equal CV profit for purposes of the NV calculation. (4) Invoice Offsets: E:\FR\FM\21SEN1.SGM 21SEN1 54000 Federal Register / Vol. 72, No. 183 / Friday, September 21, 2007 / Notices mstockstill on PROD1PC66 with NOTICES The Department and signatory producers/ exporters agree that an arrangement wherein Coexport bases its lemon oil sales price on its cost which includes an offset for the sales value of lemon juice, and later issues a credit or additional invoice to its customer to take into account the final cost of lemon oil, as offset by the lemon juice revenue, is a normal business practice which would not normally be considered in circumvention of this Agreement as defined in Section D(5) of this Agreement. However, such an arrangement will be subject to the reporting and verification requirements of this Agreement and to consideration by the Department during each NV cycle. (B) For All Other Signatories to the Agreement: Throughout the life of this Agreement, the Department will use the signatories’ reported costs and sales expenses, as adjusted by the Department, where appropriate, for purposes of calculating the signatories’ NVs, as detailed in Appendix B to this Agreement. 16, 2007, Sunflag withdrew its request for a new shipper review. Scope of the Order Imports covered by the order are shipments of SSB. SSB means articles of stainless steel in straight lengths that have been either hot–rolled, forged, turned, cold–drawn, cold–rolled or otherwise cold–finished, or ground, having a uniform solid cross section along their whole length in the shape of circles, segments of circles, ovals, rectangles (including squares), triangles, hexagons, octagons, or other convex polygons. SSB includes cold–finished SSBs that are turned or ground in straight lengths, whether produced from hot–rolled bar or from straightened and cut rod or wire, and reinforcing bars that have indentations, ribs, grooves, or other deformations produced during the [FR Doc. E7–18298 Filed 9–20–07; 8:45 am] rolling process. BILLING CODE 3510–DS–P Except as specified above, the term does not include stainless steel semi– DEPARTMENT OF COMMERCE finished products, cut–to-length flat– rolled products (i.e., cut–to-length International Trade Administration rolled products which if less than 4.75 mm in thickness have a width A–533–810 measuring at least 10 times the Stainless Steel Bar from India: Notice thickness, or if 4.75 mm or more in of Rescission of Antidumping Duty thickness having a width which exceeds New Shipper Review of Sunflag Iron & 150 mm and measures at least twice the Steel Co. Ltd. thickness), wire (i.e., cold–formed products in coils, of any uniform solid AGENCY: Import Administration, cross section along their whole length, International Trade Administration, which do not conform to the definition Department of Commerce. of flat–rolled products), and angles, EFFECTIVE DATE: September 21, 2007. shapes, and sections. FOR FURTHER INFORMATION CONTACT: The SSB subject to these reviews is Devta Ohri, AD/CVD Operations, Office currently classifiable under subheadings 1, Import Administration, International 7222.11.00.05, 7222.11.00.50, Trade Administration, U.S. Department 7222.19.00.05, 7222.19.00.50, of Commerce, 14th Street and Constitution Avenue, NW, Washington, 7222.20.00.05, 7222.20.00.45, 7222.20.00.75, and 7222.30.00.00 of the DC 20230; telephone (202) 482–3853. Harmonized Tariff Schedule of the SUPPLEMENTARY INFORMATION: United States (HTSUS). Although the HTSUS subheadings are provided for Background convenience and customs purposes, our On February 21, 1995, the Department written description of the scope of the published in the Federal Register the order is dispositive. antidumping duty order on stainless On May 23, 2005, the Department steel bar (SSB) from India. See issued a final scope ruling that SSB Antidumping Duty Orders: Stainless manufactured in the United Arab Steel Bar from Brazil, India and Japan, Emirates out of stainless steel wire rod 60 FR 9661 (February 21, 1995). On from India is not subject to the scope of February 28, 2007, the Department this order. See Memorandum from Team received a timely request from Sunflag to Barbara E. Tillman, ‘‘Antidumping for a new shipper review of the Duty Orders on Stainless Steel Bar from antidumping duty order on SSB from India and Stainless Steel Wire Rod from India, in accordance with 19 CFR India: Final Scope Ruling,’’ dated May 351.214(c). On March 23, 2007, the 23, 2005, which is on file in the CRU in Department initiated a new shipper room B–099 of the main Department review of Sunflag. See Stainless Steel building. See also Notice of Scope Bar from India: Notice of Initiation of Antidumping Duty New Shipper Review, Rulings, 70 FR 55110 (September 20, 72 FR 15110 (March 30, 2007). On April 2005). VerDate Aug<31>2005 18:17 Sep 20, 2007 Jkt 211001 PO 00000 Frm 00021 Fmt 4703 Sfmt 4703 Rescission of Review The Department’s regulations at 19 CFR 351.214(f)(1) provide that the Department will rescind a new shipper review if the party that requested the review withdraws the request within 60 days of the date of publication of the notice of initiation of the requested review. Sunflag withdrew its request for a new shipper review on April 16, 2007, which is within the 60-day deadline. Therefore, the Department is rescinding this new shipper review of Sunflag. We note that Sunflag is currently participating in the 2006–2007 antidumping duty administrative review of SSB from India, which has the exact same period of review as this new shipper review, i.e., February 1, 2006, through January 31, 2007. Therefore, we will not issue any liquidation instructions to U.S. Customs and Border Protection until after the final results are issued for the 2006–2007 antidumping duty administrative review. Notification Regarding Administrative Protective Orders This notice also serves as a reminder to parties subject to administrative protective order (‘‘APO’’) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation. This notice is published in accordance with section 777(i) of the Tariff Act of 1930, as amended, and 19 CFR 351.213(d)(4). Dated: September 12, 2007. Gary Taverman, Acting Deputy Assistant Secretary for Import Administration. [FR Doc. E7–18710 Filed 9–20–07; 8:45 am] BILLING CODE 3510–DS–S DEPARTMENT OF COMMERCE International Trade Administration Export Trade Certificate of Review Notice of issuance of an amended Export Trade Certificate of Review, Application No. 84–18A12. ACTION: SUMMARY: On September 17, 2007, The U.S. Department of Commerce issued an amended Export Trade Certificate of Review to Northwest Fruit Exporters (‘‘NFE’’). E:\FR\FM\21SEN1.SGM 21SEN1

Agencies

[Federal Register Volume 72, Number 183 (Friday, September 21, 2007)]
[Notices]
[Pages 53995-54000]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-18298]


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DEPARTMENT OF COMMERCE

International Trade Administration

[A-201-835]


Suspension of Antidumping Duty Investigation: Lemon Juice From 
Mexico

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce (``the Department'') has suspended 
the antidumping duty investigation involving lemon juice from Mexico. 
The basis for this action is an agreement between the Department and 
The Coca-Cola Company and The Coca-Cola Export Corporation, Mexico 
Branch (collectively ``Coca-Cola'') to revise their prices to eliminate 
completely sales of this merchandise to the United States at less than 
fair value.

DATES: Effective Date: September 10, 2007.

FOR FURTHER INFORMATION CONTACT: Sally Gannon or James Kemp at (202) 
482-0162 and (202) 482-5346, respectively, Bilateral Agreements Unit, 
Office of Policy, Import Administration, International Trade 
Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230.

SUPPLEMENTARY INFORMATION: 

[[Page 53996]]

Background

    On October 11, 2006, the Department initiated an antidumping duty 
investigation under section 732 of the Tariff Act of 1930, as amended 
(``the Act'') to determine whether imports of lemon juice from Mexico 
are being, or are likely to be sold in the United States at less than 
fair value (71 FR 61710 (October 19, 2006)). On November 3, 2007, the 
United States International Trade Commission (``ITC'') notified the 
Department of its affirmative preliminary injury determination in this 
case. See Lemon Juice from Argentina and Mexico, Inv. Nos. 731-TA-1105-
1106 (Preliminary) USITC Pub. No. 3891 (November 2006). On April 19, 
2007, the Department preliminarily determined that lemon juice is 
being, or is likely to be sold in the United States at less than fair 
value (``LTFV''), as provided in section 733 of the Act (Notice of 
Preliminary Determinations of Sales at Less than Fair Value and of 
Critical Circumstances in Part: Lemon Juice from Mexico, 72 FR 20830 
(April 26, 2007) (``Preliminary Determination'')). On May 17, 2007, the 
Department postponed the final determination in this investigation 
until no later than September 10, 2007 (Lemon Juice from Argentina and 
Mexico: Postponement of Final Antidumping Duty Determinations and 
Extension of Provisional Measures, 72 FR 28953 (May 23, 2007)).
    The Department and Coca-Cola initialed a proposed agreement 
suspending this investigation on August 10, 2007. On August 13, 2007, 
we invited interested parties to provide written comments on the 
proposed suspension agreement. On August 24, 2007, the Department also 
invited interested parties to provide written comments on an issue 
related to the draft suspension agreement with respect to purchase 
orders and/or long-term contracts entered into prior to September 10, 
2007. In response to our requests for comment, on August 30, 2007, we 
received comments from petitioner Sunkist Growers Inc. and respondent 
Coca-Cola. We received further comments from petitioner and respondent 
on September 6, 2007, and again from petitioner on September 7 and 10, 
2007. We have taken these comments into consideration for the final 
version of the suspension agreement.
    The Department and Coca-Cola signed the suspension agreement on 
September 10, 2007.

 Scope of Investigation

    For a complete description of the scope of the investigation, see 
Agreement Suspending the Antidumping Investigation on Lemon Juice from 
Mexico, Appendix A, signed September 10, 2007, attached hereto in Annex 
1.

Suspension of Investigation

    The Department consulted with the parties to the proceeding and has 
considered the comments submitted with respect to the proposed 
suspension agreement. In accordance with sections 734(b) and (d) of the 
Act, we have determined that the agreement will completely eliminate 
sales at less than fair value, that the agreement is in the public 
interest, and that the agreement can be monitored effectively. See, 
Public Interest and Effective Monitoring Memorandum, dated September 
10, 2007. See also, Percentage of Exports Memorandum, dated September 
10, 2007. We find, therefore, that the criteria for suspension of an 
investigation pursuant to sections 734(b) and (d) of the Act have been 
met. The terms and conditions of this agreement, signed September 10, 
2007, are set forth in Annex 1 to this notice.
    Pursuant to section 734(f)(2)(A) of the Act, the suspension of 
liquidation of all entries of lemon juice from Mexico entered, or 
withdrawn from warehouse, for consumption, as directed in the 
Preliminary Determination is hereby terminated. Any cash deposits on 
entries of lemon juice from Mexico pursuant to that suspension of 
liquidation shall be refunded and any bonds shall be released.
    This notice is published pursuant to section 734(f)(1)(A) of the 
Act.

    Dated: September 10, 2007.
Michelle O'Neill,
Deputy Under Secretary for International Trade.

Annex 1--Agreement Suspending the Antidumping Investigation on Lemon 
Juice From Mexico

    Pursuant to section 734(b) of the Tariff Act of 1930, as amended 
(19 U.S.C. 1673c(b)) (the ``Act''), and 19 CFR 351.208 (the 
``Regulations''), the U.S. Department of Commerce (the 
``Department'') and the signatory producers/exporters of Lemon Juice 
from Mexico (the ``Signatories'') enter into this suspension 
agreement (the ``Agreement''). On the basis of this Agreement, on 
the effective date of this Agreement, the Department shall suspend 
its antidumping investigation initiated on October 19, 2006 (17 FR 
61710) with respect to Lemon Juice from Mexico, subject to the terms 
and provisions set forth below.
    (A) Product Coverage:
    For purposes of this Agreement, the merchandise covered is Lemon 
Juice, as described in Appendix A.
    (B) U.S. Import Coverage:
    The signatory producers/exporters collectively are the producers 
and exporters in Mexico that accounted for substantially all (not 
less than 85 percent) of the subject merchandise imported into the 
United States, as provided in the Department's regulations at 19 CFR 
351.208(c). The Department may, at anytime during the period of the 
Agreement, require additional producers/exporters in Mexico to sign 
the Agreement in order to ensure that not less than substantially 
all imports into the United States are covered by the Agreement.
    In reviewing the operation of the Agreement for the purpose of 
determining whether this Agreement has been violated or is no longer 
in the public interest, the Department will consider imports into 
the United States from all sources of the merchandise described in 
Section A of the Agreement. For this purpose, the Department will 
consider factors including, but not limited to, the following: 
volume of trade, pattern of trade, whether or not the reseller is an 
original equipment manufacturer, and the reseller's export price 
(EP).
    (C) Basis of the Agreement:
    On and after the effective date of the Agreement, each signatory 
producer/exporter individually agrees to make any necessary price 
revisions to eliminate completely any amount by which the normal 
value (NV) of this merchandise exceeds the U.S. price of its 
merchandise subject to the Agreement. For this purpose, the 
Department will determine the NV in accordance with section 773(e) 
of the Act and U.S. price in accordance with section 772 of the Act. 
For details of the Department's calculation methodology under this 
Agreement, see Appendices B and C.
    (1) For the period from the effective date of this Agreement 
through the release of the first NVs, each signatory producer/
exporter agrees not to sell its merchandise subject to this 
Agreement in the United States.
    However, during this period and subsequent periods, as relevant, 
a signatory producer/exporter may proceed with deliveries of subject 
merchandise made pursuant to purchase orders or long-term contracts 
entered into prior to September 10, 2007, if the Department 
determines, in accordance with its regulations, that the signatory 
producer's/exporter's appropriate date of sale is the date of the 
purchase order or long-term contract (see Section I(4) below). At 
any time, should the Department determine that the purchase order or 
long-term contract date was not the appropriate date of sale for a 
signatory producer/exporter making such deliveries, the Department 
may consider such deliveries to be in violation of this Agreement 
(see Section F below). Any signatory producer/exporter making such 
deliveries under this Agreement must provide a one-time report to 
the Department, within 30 days of these deliveries having been 
completed, which contains a listing of the contract or purchase 
order dates, the delivery quantities, the dates of delivery, the 
entry dates, and the prices at which the subject merchandise was 
sold. This

[[Page 53997]]

information will be subject to verification in accordance with 
Section D(4) of this Agreement.
    (2) For all sales occurring on or after the date of issuance of 
the first NVs, through June 30, 2008 (``Interim Period''), each 
signatory producer/exporter issued NVs by the Department agrees not 
to sell its merchandise subject to this Agreement to any purchaser 
in the United States at prices that are less than the NVs of the 
merchandise, as determined by the Department on the basis of the 
sales and cost information submitted by the signatory producer/
exporter in the course of the underlying antidumping duty 
investigation. The final NVs for a signatory producer/exporter 
during this Interim Period shall be issued within 14 days after the 
preliminary NVs are issued pursuant to Section E(2) of this 
Agreement.\1\
---------------------------------------------------------------------------

    \1\ The issuance of the NVs for any given signatory may be 
delayed depending on the following: (1) Issues related to the 
underlying antidumping duty investigation; (2) to allow sufficient 
time for signatories to respond to the Department's request for 
sales and cost data; and/or (3) to resolve issues raised in comments 
from interested parties or by the Department. In accordance with 
section 773(f) of the Act, the Department will examine relevant 
prices and costs and, for any sales period, may disregard particular 
prices or costs when the prices are not in the ordinary course of 
trade, the costs are not in accordance with the generally accepted 
accounting principles, the costs do not reasonably reflect the costs 
associated with the production and sale of the merchandise, or in 
other situations provided for in the Act or the Department's 
regulations. Examples of possible areas in which adjustments may be 
necessary include, but are not limited to, costs related to energy, 
depreciation, transactions among affiliates, barter transactions, as 
well as items that are not recognized by the home country's 
generally accepted accounting principles.
---------------------------------------------------------------------------

    (3) For all sales occurring after the Interim Period, each 
signatory producer/exporter issued NVs by the Department agrees not 
to sell its merchandise subject to this Agreement to any purchaser 
in the United States at prices that are less than the NVs of the 
merchandise, as determined by the Department on the basis of 
information submitted to the Department not later than the dates 
specified in Section D of this Agreement and provided to the 
signatory producer/exporter no later than June 1 of each year. These 
NVs shall apply to sales occurring during the annual period (i.e., 
July through June) beginning 30 days following the date on which the 
Department provides the NVs, as stated in this paragraph.
    (D) Monitoring:
    Each signatory producer/exporter will supply to the Department 
all information that the Department decides is necessary to ensure 
that the producer/exporter is in full compliance with the terms of 
the Agreement. As explained below, the Department will provide each 
signatory producer/exporter a detailed request for information and 
prescribe a required format and method of data compilation, not 
later than the beginning of each reporting period.\2\
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    \2\ As noted in Section C(2) of this Agreement, the first NVs 
issued for certain signatory producer/exporters may be based on 
sales and cost information submitted by those signatories in the 
underlying antidumping duty investigation, and the resulting NVs 
issued will apply to sales occurring between the issuance date of 
the NVs and June 30, 2008 (Interim Period).
---------------------------------------------------------------------------

    (1) Sales Information:
    The Department will require each producer/exporter to report, in 
electronic form in the prescribed format and using the prescribed 
method of data compilation, each sale of the merchandise subject to 
the Agreement, either directly or indirectly to unaffiliated 
purchasers in the United States, as well as sales in the comparison 
market (home or third country market, as appropriate), including 
each adjustment applicable to each sale, as specified by the 
Department.
    The first report of sales data, pursuant to Section C(3) of this 
Agreement, shall be submitted to the Department, in electronic form 
(e.g., on diskette, zip disk, or CD ROM) in the prescribed format 
and using the prescribed method of data compilation, not later than 
October 1, 2007, and shall contain the specified sales information 
covering the period July 1, 2006, through June 30, 2007. Subsequent 
reports of sales data shall be submitted to the Department not later 
than October 1 of each year, and each report shall contain the 
specified sales information for the annual period ending on June 30 
of that year, except that if the Department receives information 
that a possible violation of the Agreement may have occurred, the 
Department may request sales data on a more frequent basis.
    (2) Cost Information:
    Producers/exporters must request NVs for all subject merchandise 
that will be sold in the United States. For those products which the 
producer/exporter is requesting NVs, the Department will require 
each producer/exporter to report, in the prescribed format and using 
the prescribed method of data compilation, the following: Its actual 
cost of manufacturing; selling, general and administrative (SG&A) 
expenses; and profit data on an annual basis. As indicated in 
Appendix B to this Agreement, profit will be reported by the 
producers/exporters on an annual basis. Each such producer/exporter 
also must report anticipated increases in production costs in the 
annual period in which the information is submitted resulting from 
factors such as anticipated changes in production yield, changes in 
production process, changes in production quantities or changes in 
production facilities.
    The first report of cost data, pursuant to Section C(3) of this 
Agreement, shall be submitted to the Department not later than 
October 15, 2007, and shall contain the specified cost data covering 
the period July 1, 2006, through June 30, 2007. Each subsequent 
report shall be submitted to the Department not later than October 
15 of each year, and each report shall contain the specified 
information for the annual period ending on June 30 of that year.
    (3) Special Adjustment of Normal Value:
    If the Department determines that the NV it determined for a 
previous annual period was erroneous because the reported costs for 
that period were inaccurate or incomplete, or for any other reason, 
the Department may adjust NV in a subsequent period or periods, 
unless the Department determines that Section F of the Agreement 
applies.
    (4) Verification:
    Each producer/exporter agrees to permit full verification of all 
cost and sales information annually, or more frequently, as the 
Department deems necessary.
    (5) Bundling or Other Arrangements:
    Producers/exporters agree not to circumvent the Agreement. In 
accordance with the dates set forth in Section D(1) of this 
Agreement, producers/exporters will submit a written statement to 
the Department certifying that the sales reported herein were not, 
or are not part of or related to, any bundling arrangement, on-site 
processing arrangement, discounts/free goods/financing package, swap 
or other exchange where such arrangement is designed to circumvent 
the basis of the Agreement.
    Where there is reason to believe that such an arrangement does 
circumvent the basis of the Agreement, the Department will request 
producers/exporters to provide within 15 days all particulars 
regarding any such arrangement, including, but not limited to, sales 
information pertaining to covered and non-covered merchandise that 
is manufactured or sold by producers/exporters. The Department will 
accept written comments, not to exceed 30 pages, from all parties no 
later than 15 days after the date of receipt of such producer/
exporter information.
    If the Department, after reviewing all submissions, determines 
that such an arrangement circumvents the basis of the Agreement, it 
may, as it deems most appropriate, utilize one of two options: (1) 
The amount of the effective price discount resulting from such 
arrangement shall be reflected in the NV in accordance with Section 
D(3) of this Agreement, or (2) the Department shall determine that 
the Agreement has been violated and take action according to the 
provisions under Section F of this Agreement.
    (6) Rejection of Submissions:
    The Department may reject any information submitted after the 
deadlines set forth in this section or any information which it is 
unable to verify to its satisfaction. If information is not 
submitted in a complete and timely fashion, or is not fully 
verifiable, the Department may calculate the NV, and/or U.S. price, 
based on facts otherwise available, as it determines appropriate, 
unless the Department determines that Section F of this Agreement 
applies.
    (E) Disclosure and Comment:
    (1) The Department may make available to representatives of each 
interested party to the proceeding, under appropriately drawn 
administrative protective orders, business proprietary information 
submitted to the Department during the reporting period as well as 
the results of its analysis under section 777 of the Act.
    (2) For sales during the Interim Period, the Department will 
disclose to each producer/exporter being issued NVs the preliminary 
results and methodology of the Department's calculations of the NVs 
on or after the effective date of this Agreement.\3\ At that

[[Page 53998]]

time, the Department may also make available such information to the 
interested parties to the proceeding in accordance with this 
section.
---------------------------------------------------------------------------

    \3\ The Department will endeavor to issue the preliminary NVs 
for the Interim Period within five days after the effective date of 
this Agreement, subject to the possible constraints noted in 
footnote 1 of Section C(2) of this Agreement.
---------------------------------------------------------------------------

    (3) Not later than May 2 of each ensuing annual sales period, 
the Department will disclose to each producer/exporter being issued 
NVs the preliminary results and methodology of the Department's 
calculations of the NVs. At that time, the Department may also make 
available such information to the interested parties to the 
proceeding, in accordance with this section.
    (4) Not later than 7 days after the dates of disclosure under 
Sections E(2) and E(3), respectively, of this Agreement, the parties 
to the proceeding may submit written comments to the Department, not 
to exceed 15 pages. After reviewing these submissions, the 
Department will provide to each producer/exporter its final NVs, as 
provided in Sections C(2) and C(3), respectively, of this Agreement. 
In addition, the Department may provide such information to 
interested parties, as specified in this section.
    (F) Violations of the Agreement:
    If the Department determines that the Agreement is being or has 
been violated or no longer meets the requirements of sections 734(b) 
or (d) of the Act, the Department shall take action it determines 
appropriate under section 734(i) of the Act and the regulations.
    (G) Other Provisions:
    In entering into the Agreement, the signatory producers/
exporters do not admit that any sales of merchandise subject to the 
Agreement have been made at less than fair value.
    (H) Termination or Withdrawal:
    Termination of the suspended investigation will be considered in 
accordance with the five-year review provisions of section 351.218 
of the Department's regulations.
    Any producer/exporter may withdraw from the Agreement at any 
time upon notice to the Department. Withdrawal shall be effective 60 
days after such notice is given to the Department. Upon withdrawal, 
the Department shall follow the procedures outlined in section 
734(i)(1) of the Act.
    (I) Definitions:
    For purposes of the Agreement, the following definitions apply:
    (1) ``U.S. price'' means the export price or constructed export 
price at which merchandise is sold by the producer or exporter to 
the first unaffiliated person in the United States, including the 
amount of any discounts, rebates, price protection or ship and debit 
adjustments, and other adjustments affecting the net amount paid or 
to be paid by the unaffiliated purchaser, as determined by the 
Department under section 772 of the Act.
    (2) ``Normal value'' means the constructed value (CV) of the 
merchandise, as determined by the Department under section 773 of 
the Act and the corresponding sections of the Department's 
regulations, and as adjusted in accordance with Appendix B to this 
Agreement.
    (3) ``Producer/Exporter'' means (1) the foreign manufacturer or 
producer, (2) the foreign producer or reseller which also exports, 
and (3) the affiliated person by whom or for whose account the 
merchandise is imported into the United States, as defined in 
section 771(28) of the Act.
    (4) ``Date of sale'' means the date of the invoice as recorded 
in the exporter's or producer's records kept in the ordinary course 
of business, unless the Department determines that a different date 
better reflects the date on which the exporter or producer 
establishes the material terms of sale, as determined by the 
Department under its regulations.
    The effective date of this Agreement is September 10, 2007.

For Mexican Producers/Exporters:
Dated: September 10, 2007.

Mark P. Lunn,
The Coca-Cola Company and The Coca-Cola Export Corporation, Mexico 
Branch.

For U.S. Department of Commerce:
Dated: September 10, 2007.

Michelle O'Neill,
Deputy Under Secretary for Import Administration.

Appendix A: Product Coverage

    For purposes of this Agreement, the merchandise covered 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 Agreement is dispositive.

Appendix B: Principles of Cost

General Framework

    The cost information reported to the Department that will form 
the basis of the NV calculations for purposes of the Agreement must 
be: \4\
---------------------------------------------------------------------------

    \4\ See footnote  1 in Section C(2) of this Agreement.
---------------------------------------------------------------------------

     Comprehensive in nature and based on a reliable 
accounting system (i.e., a system based on well-established 
standards that can be tied to the audited financial statements);
     Calculated on an annual weighted-average basis of the 
plants or cost centers manufacturing the product;
     Based on fully-absorbed costs of production, including 
any downtime;
     Valued in accordance with generally accepted accounting 
principles; and
     Reflective of appropriately allocated common costs so 
that the costs necessary for the manufacturing of the product are 
not absorbed by other products.
    Additionally, a separate figure should be reported for each 
major cost component making up the cost of production.

Cost of Manufacturing (COM)

    Costs of manufacturing are reported by major cost category and 
for major stages of production. Weighted-average costs are used for 
a product that is produced at more than one facility, based on the 
product's cost at each facility and relative production quantities.
    Direct materials costs include the acquisition costs of all 
materials that are identified as part of the finished product and 
may be traced to the finished product in an economically feasible 
way. In contrast to indirect materials, direct materials are applied 
and assigned directly to a finished product. Direct materials costs 
should include transportation charges, import duties, and other 
expenses normally associated with obtaining the materials that 
become an integral part of the finished product.
    Direct labor costs are the labor costs identified with a 
specific product. These costs are not allocated among products 
except when two or more products are produced at the same cost 
center. Direct labor costs should include salary, bonus and overtime 
pay, training expenses, and all fringe benefits. Any contracted-
labor expense should reflect the actual billed cost.
    Variable manufacturing overhead costs include those production 
costs, other than direct materials or direct labor, that generally 
vary in total with changes in the volume of merchandise produced at 
a given level of operations. Variable manufacturing overhead costs 
may include indirect materials (e.g., supplies used in the 
manufacturing process), indirect labor (e.g. supervisory labor paid 
on an hourly basis), utilities (e.g., energy), and other variable 
overhead costs. Because variable overhead costs are typically 
incurred for an entire production line or factory, the costs must be 
allocated to the products produced using a reasonable basis.
    Fixed manufacturing overhead costs include those production 
costs that generally do not vary in total with changes in the volume 
of merchandise produced at a given level of operations. Fixed 
manufacturing overhead costs may include the costs incurred for 
building or equipment rental, depreciation, supervisory labor paid 
on a salary basis, plant property taxes, and factory administrative 
costs. In addition, fixed manufacturing overhead costs include 
research and development (R&D) costs which relate specifically to 
the subject merchandise.

Cost of Production (COP)

    COP is equal to the sum of direct materials, direct labor, 
variable manufacturing

[[Page 53999]]

overhead, and fixed manufacturing overhead (i.e. COM) plus SG&A 
expenses in the home market (HM).
    SG&A expenses are those expenses incurred for the operation of 
the corporation as a whole and not directly related to the 
manufacture of a particular product. They include corporate general 
and administrative expenses, financing expenses, and general 
research and development expenses. Additionally, direct and indirect 
selling expenses incurred in the HM for sales of the product under 
investigation are included. Such expenses are allocated to COM using 
a ratio of SG&A costs.

Constructed Value (CV)

    Constructed value is equal to the sum of materials, labor and 
overhead (COM) and SG&A expenses plus profit in the comparison 
market and the cost of packing for exportation to the United States.

Calculation of Suspension Agreement Normal Values

    Normal values (for purposes of the Agreement) are calculated by 
adjusting the CV and are provided for both EP and CEP transactions. 
In effect, any expenses uniquely associated with the covered 
products sold in the HM are subtracted from the CV, and any such 
expenses which are uniquely associated with the covered products 
sold in the United States are added to the CV to calculate the NV.
    ``Export Price''--Generally, a U.S. sale is classified as an 
export price sale when the first sale to an unaffiliated person 
occurs before the goods are imported into the United States. In 
cases where the foreign manufacturer knows or has reason to believe 
that the merchandise is ultimately destined for the United States, 
the manufacturer's sale is the sale subject to review. If, on the 
other hand, the manufacturer sold the merchandise to a foreign 
trader without knowledge of the trader's intention to export the 
merchandise to the United States, then the trader's first sale to an 
unaffiliated person is the sale subject to review. For EP NVs, the 
CV is adjusted for movement costs and differences in direct selling 
expenses such as commissions, credit, warranties, technical 
services, advertising, and sales promotion.
    ``Constructed Export Price''--Generally, a U.S. sale is 
classified as a constructed export price sale when the first sale to 
an unaffiliated person occurs after importation. However, if the 
first sale to an unaffiliated person is made by a person in the 
United States affiliated with the foreign exporter, constructed 
export price applies even if the sale occurs prior to importation, 
unless the U.S. affiliate performs only clerical functions in 
connection with the sale. For CEP NVs, the CV is adjusted similar to 
EP sales, with differences for adjustment to U.S. and HM indirect 
selling expenses.
    Home market direct selling expenses are expenses that are 
incurred as a direct result of a sale. These include such expenses 
as commissions, advertising, discounts and rebates, credit, warranty 
expenses, freight costs, etc. Certain direct selling expenses are 
treated individually, including:

--Commission expenses, i.e., payments to unaffiliated parties for 
sales in the HM.
--Credit expenses, i.e., expenses incurred for the extension of 
credit to HM customers.
--Movement expenses, e.g., foreign inland freight and insurance 
expenses, warehousing, and foreign brokerage, handling and port 
charges.

    U.S. direct selling expenses are the same as HM direct selling 
expenses except that they are incurred for sales in the United 
States. Movement expenses are additional expenses associated with 
importation into the United States, which typically include: U.S. 
inland freight and insurance expenses; U.S. brokerage, handling and 
port charges; U.S. Customs duties, U.S. warehousing; and 
international freight and insurance.
    U.S. indirect selling expenses include general fixed expenses 
incurred by the U.S. sales subsidiary or affiliated exporter for 
sales to the United States and may also include a portion of 
indirect expenses incurred in the HM for export sales.
    The EP and CEP NVs are calculated as follows:

------------------------------------------------------------------------
                           For EP transactions
-------------------------------------------------------------------------
+ Direct Materials.
+ Direct Labor.
+ Factory Overhead.
= Cost of Manufacturing (COM).
 
+ Home Market SG&A.
= Cost of Production (COP).
 
+ U.S. Packing.
+ Profit.
= Constructed Value.
 
+ U.S. Direct Selling Expense.
+ U.S. Commission Expense.
+ U.S. Movement Expense.
+ U.S. Credit Expense.
- HM Direct Selling Expense.
- HM Commission Expense. \1\
- HM Credit Expense.
= NV for EP Sales.
------------------------------------------------------------------------
\1\ If the company does not have HM commissions, HM indirect expenses
  are subtracted only up to the amount of the U.S. commissions.


------------------------------------------------------------------------
                          For CEP transactions
-------------------------------------------------------------------------
+ Direct Materials.
+ Direct Labor.
+ Factory Overhead.
= Cost of Manufacturing (COM).
 
+ Home Market SG&A.
= Cost of Production (COP).
 
+ U.S. Packing.
+ Profit.
= Constructed Value.
 
+ U.S. Direct Selling Expense.
+ U.S. Indirect Selling Expense.
+ U.S. Commission Expense.
+ U.S. Movement Expense.
+ U.S. Credit Expense.
+ U.S. Further-Manufacturing Expense (if any).\1\
+ CEP Profit.
- HM Direct Selling Expense.
- HM Commission Expense.\2\
- HM Credit Expense.
= NV for CEP Sales.
------------------------------------------------------------------------
\1\ The Department will examine any further-manufacturing expenses on
  value-added products sold to the first unaffiliated purchaser in the
  United States by a person affiliated with the foreign producer/
  exporter, and produced from subject merchandise purchased directly
  from that foreign producer/exporter, on a case-by-case basis and
  reserves the right to make adjustments to its reporting requirements
  and calculation methodology for these expenses. For example, in cases
  where a producer/exporter's affiliate makes sales of products with
  significant value added to unaffiliated purchasers in the United
  States, or the range of such products is significant, the Department
  may adjust its reporting requirements and calculation methodology for
  the further manufacturing costs associated with the value-added
  products. Additionally, if the ratio of a producer/exporter's reported
  sales to unaffiliated purchasers versus its sales to affiliated
  persons shifts over time, the Department may make further adjustments
  in its reporting requirements and calculation methodology for the
  further-manufacturing expenses associated with the value-added
  products.
\2\ If the company does not have HM commissions, HM indirect expenses
  are subtracted only up to the amount of the U.S. commissions.

Appendix C: Cost Allocation and NV Methodology

    The following provides clarification regarding the methodologies 
the Department will use in calculating normal values under this 
Agreement:
    (A) For The Coca-Cola Company and The Coca-Cola Export 
Corporation, Mexico Branch (collectively, ``Coexport''):
    (1) Cost Allocation for Life of Agreement:
    Throughout the life of this Agreement, to allocate common costs, 
the Department will allocate 8.5 percent of the reported lemon fruit 
costs and common lemon processing costs to lemon juice and 91.5 
percent of these same costs to lemon oil for purposes of calculating 
Coexport's NVs, as detailed in Appendix B to this Agreement.
    (2) All Other Costs and Sales Expenses for Interim Period NVs:
    For the Interim Period only of this Agreement, the Department 
will use all other reported costs and sales expenses, as adjusted by 
the Department, where appropriate, for the preliminary determination 
in the underlying antidumping duty investigation, for purposes of 
calculating Coexport's NVs, as detailed in Appendix B to this 
Agreement.
    (3) Monitoring of Value-Added Products after the Interim Period:
    In addition to the stipulations noted in footnote 1 to 
the calculation for CEP transactions in Appendix B to this 
Agreement, the Department shall normally choose between two to three 
products with significant value added, as reported by Coexport 
pursuant to Section D(1) during each NV cycle, for examination and 
monitoring of the related costs and sales expenses. For such value-
added products, the Department shall set CEP profit to equal CV 
profit for purposes of the NV calculation.
    (4) Invoice Offsets:

[[Page 54000]]

    The Department and signatory producers/exporters agree that an 
arrangement wherein Coexport bases its lemon oil sales price on its 
cost which includes an offset for the sales value of lemon juice, 
and later issues a credit or additional invoice to its customer to 
take into account the final cost of lemon oil, as offset by the 
lemon juice revenue, is a normal business practice which would not 
normally be considered in circumvention of this Agreement as defined 
in Section D(5) of this Agreement. However, such an arrangement will 
be subject to the reporting and verification requirements of this 
Agreement and to consideration by the Department during each NV 
cycle.
    (B) For All Other Signatories to the Agreement:
    Throughout the life of this Agreement, the Department will use 
the signatories' reported costs and sales expenses, as adjusted by 
the Department, where appropriate, for purposes of calculating the 
signatories' NVs, as detailed in Appendix B to this Agreement.

[FR Doc. E7-18298 Filed 9-20-07; 8:45 am]
BILLING CODE 3510-DS-P