Sugar From Mexico: Suspension of Countervailing Duty Investigation, 78044-78051 [2014-30392]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 79, Number 248 (Monday, December 29, 2014)]
[Notices]
[Pages 78044-78051]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-30392]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-201-846]


Sugar From Mexico: Suspension of Countervailing Duty 
Investigation

AGENCY: Enforcement and Compliance, International Trade Administration, 
Department of Commerce.

DATES: Effective Date: December 19, 2014.

SUMMARY: The Department of Commerce (``the Department'') has suspended 
the countervailing duty investigation on sugar from Mexico. The basis 
for this action is an agreement between the Department and the 
Government of Mexico (``GOM''), wherein the GOM has agreed not to 
provide any new or additional export or import substitution subsidies 
on the subject merchandise and has agreed to restrict the volume of 
direct or indirect exports to the United States of sugar from all 
Mexican producers/exporters in order to eliminate completely the 
injurious effects of exports of this merchandise to the United States.

[[Page 78045]]


FOR FURTHER INFORMATION CONTACT: Judith Wey Rudman or Sally Craig 
Gannon at (202) 482-0192 or (202) 482-0162, respectively; Bilateral 
Agreements Unit, Office of Policy, Enforcement and Compliance, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street & Constitution Avenue NW., Washington, DC, 20230.

SUPPLEMENTARY INFORMATION:

Background

    On April 17, 2014, the Department initiated a countervailing duty 
investigation under section 702 of the Tariff Act of 1930, as amended 
(``the Act''), to determine whether manufacturers, producers, or 
exporters of sugar from Mexico receive subsidies. See Sugar from 
Mexico: Initiation of Countervailing Duty Investigation, 79 FR 22790 
(April 24, 2014). On August 25, 2014, the Department preliminarily 
determined that countervailable subsidies are being provided to 
producers and exporters of sugar from Mexico and aligned the final 
countervailing duty determination with the final antidumping duty 
determination. See Sugar from Mexico: Preliminary Affirmative 
Countervailing Determination and Alignment of Final Countervailing Duty 
Determination With Final Antidumping Duty Determination, 79 FR 51956 
(September 2, 2014) (``Preliminary Determination'').
    On October 27, 2014, the Department and the GOM initialed a 
proposed agreement to suspend the countervailing duty investigation on 
sugar from Mexico. After initialing the proposed agreement, consistent 
with 704(e)(1) of the Act, the Department notified and consulted with 
the petitioners (i.e., the American Sugar Coalition and its individual 
members: American Sugar Cane League, American Sugar Refining, Inc., 
American Sugarbeet Growers Association, Florida Sugar Cane League, 
Hawaiian Commercial and Sugar Company, Rio Grande Valley Sugar Growers, 
Inc., Sugar Cane Growers Cooperative of Florida, and United States Beet 
Sugar Association) concerning its intention to suspend the antidumping 
investigation on sugar from Mexico. The Department also notified the 
other parties to the investigation and the International Trade 
Commission (``ITC'') of the proposed agreement, consistent with 
704(e)(1) of the Act. Also on October 27, 2014, we invited interested 
parties to provide written comments on the proposed suspension 
agreement by no later than the close of business on November 10, 2014. 
See ``Memorandum to All Interested Parties'' and ``Draft Agreement 
Suspending the Countervailing Duty Investigation on Sugar from 
Mexico,'' dated October 27, 2014. On October 30, 2104, the Department 
issued a memorandum titled ``Proposed Scope Clarification'' and 
requested comments from interested parties. On November 7, 2014, we 
extended the deadline to submit comments on the draft suspension 
agreement and the proposed scope clarification until November 18, 2014. 
See memorandum titled ``Sugar from Mexico: Notice of Extension of 
Deadline to Submit Comments on Draft Suspension Agreements and Scope 
Clarification,'' dated November 7, 2014. We received comments from 
numerous parties by the November 18, 2014, deadline.
    The Department and the GOM signed the suspension agreement on 
December 19, 2014. See Agreement Suspending the Countervailing Duty 
Investigation on Sugar from Mexico, signed on December 19, 2014 
(``Suspension Agreement''), attached hereto. Based on the scope 
comments received in this investigation, the Department has revised the 
scope of this investigation, as provided in the scope of the Suspension 
Agreement.

Scope of Agreement

    See Section I, Product Coverage, of the Suspension Agreement.

Suspension of Investigation

    The Department consulted with the parties to the proceeding and has 
considered the comments submitted by interested parties with respect to 
the proposal to suspend the countervailing duty investigation. In 
accordance with section 704(c) of the Act, we have determined that 
extraordinary circumstances are present in this case, as defined by 
section 704(c)(4) of the Act. See the memorandum titled ``Agreement 
Suspending the Countervailing Duty Investigation on Sugar from Mexico: 
Existence of Extraordinary Circumstances, Public Interest, and 
Effective Monitoring Assessments'' from Lynn Fischer Fox, Deputy 
Assistant Secretary for Policy and Negotiations, to Paul Piquado, 
Assistant Secretary for Enforcement and Compliance, dated December 19, 
2014 (``statutory requirements memorandum'').
    The Suspension Agreement provides that: (1) The GOM will not 
provide any new or additional export or import substitution subsidies 
on the subject merchandise; and (2) the GOM will restrict the volume of 
direct or indirect exports to the United States of subject merchandise 
from all Mexican producers/exporters.
    Following consultations under section 704(a)(2)(C) of the Act, we 
have also determined that the Suspension Agreement is in the public 
interest and can be monitored effectively, as required under section 
704(d) of the Act. See statutory requirements memorandum.
    For the reasons outlined above, we find that the Suspension 
Agreement meets the criteria of section 704(c) and (d) of the Act.
    The terms and conditions of this Suspension Agreement, signed 
December 19, 2014, are set forth in the Suspension Agreement, which is 
attached to this notice.

International Trade Commission

    In accordance with section 704(f) of the Act, the Department has 
notified the ITC of the Suspension Agreement.

Suspension of Liquidation

    The suspension of liquidation ordered in the Preliminary 
Determination, shall continue to be in effect, subject to section 
704(h)(3) of the Act. Section 704(f)(2)(B) of the Act provides that the 
Department may adjust the security required to reflect the effect of 
the Suspension Agreement. The Department has found that the Suspension 
Agreement eliminates completely the injurious effects of imports and, 
thus, the Department is adjusting the security required to zero. If 
there is no request for review of suspension under section 704(h) of 
the Act, or if the ITC conducts a review and finds that the injurious 
effect of imports of the subject merchandise is eliminated completely 
by the Suspension Agreement, the Department will terminate the 
suspension of liquidation of all entries of sugar from Mexico and 
refund any cash deposits collected on entries of sugar from Mexico 
consistent with section 704(h)(3) of the Act.
    Notwithstanding the Suspension Agreement, the Department will 
continue the investigation if it receives such a request within 20 days 
after the date of publication of this notice in the Federal Register, 
in accordance with section 704(g) of the Act. Pursuant to Section XI of 
the Suspension Agreement, the Department will terminate the Suspension 
Agreement in the event that the GOM requests continuation of this 
investigation, or signatories accounting for a significant proportion 
of exports of sugar from Mexico request continuation of the antidumping 
investigation of sugar from Mexico, and will resume the investigation.

[[Page 78046]]

Administrative Protective Order Access

    The Administrative Protective Order (``APO'') the Department 
granted in the investigation segment of this proceeding remains in 
place. While the investigation is suspended, parties subject to the APO 
may retain, but may not use, information received under that APO. All 
parties wishing access to business proprietary information submitted 
during the administration of the Suspension Agreement must submit new 
APO applications in accordance with the Department's regulations 
currently in effect. See section 777(c)(1) of the Act; 19 CFR 351.103, 
351.304, 351.305, and 351.306. An APO for the administration of the 
Suspension Agreement will be placed on the record within five days of 
the date of publication of this notice in the Federal Register.
    We are issuing and publishing this notice in accordance with 
section 704(f)(1)(A) of the Act and 19 CFR 351.208(g)(2).

    Dated: December 19, 2014.
Paul Piquado,
Assistant Secretary for Enforcement and Compliance.
Attachment

AGREEMENT SUSPENDING THE COUNTERVAILING DUTY INVESTIGATION ON SUGAR 
FROM MEXICO

    Pursuant to the requirements of section 704(c) of the Tariff Act of 
1930, as amended (the Act) (19 U.S.C. 1671c(c)) and 19 CFR 351.208, and 
in satisfaction of the requirements of those provisions, the U.S. 
Department of Commerce (the Department) and the Government of Mexico 
(GOM), through the Secretaria de Economia, enter into this agreement 
suspending the countervailing duty investigation of Sugar from Mexico 
(Agreement), as follows:

I. Product Coverage

    The product covered by this Agreement is raw and refined sugar of 
all polarimeter readings derived from sugar cane or sugar beets. The 
chemical sucrose gives sugar its essential character. Sucrose is a 
nonreducing disaccharide composed of glucose and fructose linked by a 
glycosidic bond via their anomeric carbons. The molecular formula for 
sucrose is C12H22O11; the 
International Union of Pure and Applied Chemistry (IUPAC) International 
Chemical Identifier (InChl) for sucrose is 1S/C12H22O11/c13-l-4-
6(16)8(18)9(19)11(21-4)23-12(3-15)10(20)7(17)5(2-14)22-12/h4-11,13-
20H,1-3H2/t4-,5-,6-,7-,8+,9-,10+,11-, 12+/m1/s1; the InChl Key for 
sucrose is CZMRCDWAGMRECN-UGDNZRGBSA-N; the U.S. National Institutes of 
Health PubChem Compound Identifier (CID) for sucrose is 5988; and the 
Chemical Abstracts Service (CAS) Number of sucrose is 57-50-1.
    Sugar described in the previous paragraph includes products of all 
polarimeter readings described in various forms, such as raw sugar, 
estandar or standard sugar, high polarity or semi-refined sugar, 
special white sugar, refined sugar, brown sugar, edible molasses, 
desugaring molasses, organic raw sugar, and organic refined sugar. 
Other sugar products, such as powdered sugar, colored sugar, flavored 
sugar, and liquids and syrups that contain 95 percent or more sugar by 
dry weight are also within the scope of this Agreement.
    The scope of the Agreement does not include (1) sugar imported 
under the Refined Sugar Re-Export Programs of the U.S. Department of 
Agriculture; \1\ (2) sugar products produced in Mexico that contain 95 
percent or more sugar by dry weight that originated outside of Mexico; 
(3) inedible molasses (other than inedible desugaring molasses noted 
above); (4) beverages; (5) candy; (6) certain specialty sugars; and (7) 
processed food products that contain sugar (e.g., cereals). Specialty 
sugars excluded from the scope of this Agreement are limited to the 
following: caramelized slab sugar candy, pearl sugar, rock candy, 
dragees for cooking and baking, fondant, golden syrup, and sugar 
decorations.
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    \1\ This exclusion applies to sugar imported under the Refined 
Sugar Re-Export Program, the Sugar-Containing Products Re-Export 
Program, and the Polyhydric Alcohol Program administered by the U.S. 
Department of Agriculture.
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    Merchandise covered by this Agreement is typically imported under 
the following headings of the HTSUS: 1701.12.1000, 1701.12.5000, 
1701.13.1000, 1701.13.5000, 1701.14.1000, 1701.14.5000, 1701.91.1000, 
1701.91.3000, 1701.99.1010, 1701.99.1025, 1701.99.1050, 1701.99.5010, 
1701.99.5025, 1701.99.5050, and 1702.90.4000. The tariff classification 
is provided for convenience and customs purposes; however, the written 
description of the scope of this Agreement is dispositive.

II. Definitions

    For purposes of the Agreement, the following definitions apply:
    A. ``Anniversary Month'' means the month in which the Agreement 
becomes effective.
    B. ``Base Export Limit'' means the amount of Sugar allocated to 
producers and exporters of Sugar in Mexico at the beginning of each 
Export Limit Period.
    C. ``Date of Export'' means the date on which the product is 
exported from Mexico to the United States.
    D. ``Effective Date'' means the date on which the Department and 
the GOM sign the Agreement.
    E. ``Export License'' means the document issued by the GOM's export 
license issuing authority, pursuant to Section VI of the Agreement.
    F. ``Export Limit'' means the quantity of Mexican Sugar permitted 
to be exported, based on the Date of Export, during a given Export 
Limit Period.
    G. ``Export Limit Period'' means one of the following periods:
    1. ``Initial Export Limit Period'' covers entries of Sugar entered, 
or withdrawn from warehouse for consumption, between the Effective Date 
and September 30, 2015.
    2. ``Subsequent Export Limit Period'' covers entries of Sugar 
entered, or withdrawn from warehouse for consumption, in each 
subsequent period from October 1 through September 30.
    H. ``Interested Party'' means any person or entity that meets the 
definitions in section 771(9) of the Act.
    I. ``Indirect Exports'' means exports of Sugar from Mexico to the 
United States through one or more Third Countries, whether or not such 
exports are further processed, provided that the further processing 
does not result in a substantial transformation or a change in the 
country of origin, as determined by the Department.
    J. ``Mexico'' means the customs territory of the United Mexican 
States and foreign trade zones located within the territory of Mexico.
    K. ``Other Sugar'' means Sugar that does not meet the definition of 
Refined Sugar under this Agreement.
    L. ``Refined Sugar'' means Sugar with a polarity of 99.5 and above.
    M. ``Sugar'' means the product described under Section I, ``Product 
Coverage,'' of the Agreement.
    N. ``Target Quantity of U.S. Needs'' means 100 percent of U.S. 
Needs, as defined below.
    O. ``Third Country'' or ``Third Countries'' mean any country other 
than the United States or Mexico, including any customs territory or 
free trade zone administered, governed, or controlled by such country.
    P. ``United States'' means the customs territory of the United 
States of America (the 50 States, the District of Columbia and Puerto 
Rico) and foreign trade zones located within the territory of the 
United States.

[[Page 78047]]

    Q. ``USDA'' means the United States Department of Agriculture.
    R. ``U.S. Needs'' is calculated based on information in the WASDE 
published by USDA and means:

(Total Use * 1.135) - Beginning Stocks - Production - TRQ Imports - 
Other Program Imports - (Footnote 5 for ``other high tier'' + 
``other'')

    S. ``Violation'' means noncompliance with the terms of the 
Agreement, whether through an act or omission, except for noncompliance 
that is inconsequential or inadvertent, and does not materially 
frustrate the purposes of the Agreement.
    T. ``WASDE'' means the ``World Agriculture Supply and Demand 
Estimates'' published by the USDA.
    Any term or phrase not defined by this section shall be defined 
using either a definition provided in the Act for that term or phrase, 
or the plain meaning of that term, as appropriate.

III. Suspension of Investigation

    As of the Effective Date, in accordance with section 704(c)(1) and 
(3) of the Act and 19 CFR 351.208, the Department will suspend its 
countervailing duty investigation on Sugar from Mexico initiated on 
April 17, 2014. See Sugar from Mexico: Initiation of Countervailing 
Duty Investigation, 79 FR 22,790 (Apr. 24, 2014).

IV. Statutory Conditions for the Agreement

    In accordance with section 704(c)(1) and (4) of the Act, the 
Department has determined that extraordinary circumstances are present 
in this investigation because the suspension of the investigation will 
be more beneficial to the domestic industry than the continuation of 
the investigation and the investigation is complex.
    In accordance with section 704(d)(1) of the Act, the Department has 
determined that the suspension of the investigation is in the public 
interest and that effective monitoring of the Agreement by the United 
States is practicable. Section 704(a)(2)(B) of the Act provides that 
the public interest includes the availability of supplies of the 
merchandise and the relative impact on the competitiveness of the 
domestic industry producing the like merchandise, including any such 
impact on employment and investment in that industry. Accordingly, if a 
domestic producer requests an administrative review of the status of, 
and compliance with, the Agreement, the Department will take these 
factors into account in conducting that review. If the Department finds 
that the Agreement is not working as intended in this regard, the 
Department will explore all appropriate measures, including 
renegotiation of the terms of the Agreement to resolve the problem or 
measures under Section 751(d)(1) of the Act.

V. Export Limits

    No Sugar covered by the Agreement, whether exported directly or 
indirectly from Mexico, shall be entered into the United States unless, 
when cumulated with all prior entries of Sugar exported from Mexico 
during the Export Limit Period in which the Sugar was exported, it does 
not exceed the applicable Export Limit set forth below. All exports of 
Sugar from Mexico that enter the United States will be counted against 
the Export Limit established for the applicable Export Limit Period.
    A. The Export Limit for the Initial Export Limit Period shall be 
calculated using the formula provided in Section V.B, beginning with 
the December allocation in Section V.B.2. The restriction in Section 
V.C.2 below shall apply, and the March allocation in Section V.B.3 
applies.
    B. The Export Limit for each Subsequent Export Limit Period will be 
seventy (70) percent of the Target Quantity of U.S. Needs as calculated 
based on the July WASDE preceding the beginning of the Export Limit 
Period. The Export Limit will be effective October 1. The Export Limit 
may be increased in the following manner:
    1. In September of each Subsequent Export Limit Period, the 
Department will determine if there is a need for additional Sugar in 
the U.S. market beyond the Export Limit calculated in July. The 
Department will calculate the Target Quantity of U.S. Needs based on 
information in the September WASDE. Effective October 1, the Export 
Limit shall be revised to equal seventy (70) percent of the Target 
Quantity of U.S. Needs, unless that amount is less than or equal to the 
Export Limit announced in July, in which case the Export Limit shall 
not change.
    2. In December of each Subsequent Export Limit Period, the 
Department will determine if there is a need for additional Sugar in 
the U.S. market beyond the Export Limit calculated in September. The 
Department will calculate the Target Quantity of U.S. Needs based on 
information in the December WASDE. Effective January 1, the Export 
Limit shall be revised to equal eighty (80) percent of the Target 
Quantity of U.S. Needs, unless that amount is less than or equal to the 
Export Limit announced in September, in which case the Export Limit 
shall not change.
    3. In March of each Subsequent Export Limit Period, the Department 
will determine if there is a need for additional Sugar in the U.S. 
market beyond the Export Limit calculated in December. The Department 
will calculate the Target Quantity of U.S. Needs based on information 
in the March WASDE. Effective April 1, the Export Limit shall be 
revised to equal 100 percent of the Target Quantity of U.S. Needs, 
unless the amount is less than or equal to the Export Limit announced 
in December, in which case the Export Limit shall not change.
    4. Prior to April 1 of any Export Limit Period, the Department may 
increase the Export Limit to address potential shortages in the U.S. 
market that are identified by USDA, in writing. After April 1, if USDA 
informs the Department, in writing, of any additional need for Sugar 
from Mexico, the Department may increase the Export Limit based upon 
USDA's request.
    C. The following restrictions on shipping patterns for exports of 
Sugar from Mexico to the United States shall also apply.
    1. No more than 30 percent of U.S. Needs calculated in each July 
and effective October 1 may be exported to the United States during the 
period October 1 through December 31.
    2. No more than 55 percent of U.S. Needs calculated in each 
December and effective January 1 may be exported to the United States 
during the period October 1 through March 31.
    3. Refined Sugar may account for no more than 53 percent of the 
exports during any given Export Limit Period.
    D. If any Sugar from Mexico is entered into the United States in 
excess of the Export Limit established for the relevant Export Limit 
Period or without a valid Export License, the Department shall consult 
with the GOM and request that the GOM reduce the export allocation for 
the producer/exporter involved by twice the volume of the entry. If the 
export allocation has been reached for the producer/exporter for the 
relevant Export Limit Period, twice the volume of the entry will be 
subtracted from the producer/exporter's allocation in the next Export 
Limit Period. If the entry cannot be tied to a specific producer/
exporter, the Department may reduce the Export Limit that is effective 
April 1 by twice the volume of the entry.
    E. Subsequent to the publication of the March WASDE but prior to 
March 31 of each Export Limit Period, the GOM will inform the 
Department if there is any amount of U.S. Needs that exporters of Sugar 
from Mexico will be

[[Page 78048]]

unable to supply during the second half of the Export Limit Period. The 
Department will adjust the Export Limit downward by any amount that 
Mexico cannot supply. Mexico agrees that, if it cannot satisfy Mexico's 
needs using Mexican production, it will not supply those needs with 
imports from a Third Country or Countries for the purpose of filling 
the Export Limit with Sugar from Mexico. If the Department receives 
information that Mexico may have imported Sugar from a Third Country or 
Countries for this purpose during any Export Limit Period, the 
Department will hold consultations with the GOM in determining 
appropriate action, as warranted.
    F. The GOM and the Department shall hold consultations regarding 
the GOM's compliance with the provisions of this section consistent 
with Section VIII.D.2 of the Agreement.

VI. Implementation

    A. On and after 60 days from the Effective Date, presentation of a 
shipment-specific Export License is required as a condition for entry 
of Sugar from Mexico into the United States. Pursuant to 19 CFR 
351.208(i), the Department will instruct U.S. Customs and Border 
Protection (CBP) to prohibit the entry of any Sugar from Mexico not 
accompanied by an Export License.
    B. Export Licenses will be shipment-specific and must contain the 
information identified in Appendix I. Additional information may be 
included on the Export License or, if necessary, a separate page 
attached to the Export License. If the bills of lading for each 
shipment establish that the actual imports into the United States under 
that license were less than the total volume listed on the license, the 
GOM shall notify the Department in writing that the GOM intends to 
issue a new Export License in the same Export Limit Period authorizing 
additional exports equal in volume to the volume of the undershipment.
    C. The GOM will ensure compliance with all of the provisions of the 
Agreement. To ensure such compliance, the GOM will take the following 
measures:
    1. Ensure that no Sugar is exported from Mexico for entry into the 
United States during any Export Limit Period that exceeds the Export 
Limit for that Export Limit Period.
    2. Establish an Export Limit licensing and enforcement program for 
all direct and indirect exports of Sugar from Mexico to the United 
States no later than 60 days after the Effective Date. Export Licenses 
shall contain all information described in Appendix I of the Agreement.
    3. Require that applications for Export Licenses contain all of the 
information listed in Appendix I of the Agreement.
    4. Refuse to issue an Export License to any applicant that does not 
permit full verification and reporting under the Agreement of all of 
the information in the application.
    5. Issue Export Licenses sequentially, charged against the Export 
Limit for the relevant Export Limit Period, and reference any notice of 
the Export Limit allocation for the relevant Export Limit Period. 
Export Licenses shall remain valid for entry into the United States for 
90 days. The Department and the GOM may agree to an extension of the 
validity of the Export License in extraordinary circumstances.
    6. Permit full verification of all information related to the 
administration of the Agreement on an annual basis or more frequently, 
as deemed necessary.
    7. Ensure compliance with all procedures established to effectuate 
the Agreement by any official Mexican institution, chamber, or other 
authorized Mexican company, and any Mexican producer, exporter, broker, 
and trader of Sugar.
    8. Impose strict measures, such as prohibition from participation 
in the Export Limit allocation allowed by the Agreement, in the event 
that any Mexican company does not comply in full with the requirements 
established by the GOM pursuant to the Agreement.
    D. The GOM and the Department shall hold consultations regarding 
the GOM's compliance with the provisions of this section consistent 
with Section VIII.D.1 of the Agreement.

VII. Anti-Circumvention

    A. The GOM will take all necessary measures to prevent 
circumvention of the Agreement. These measures shall include requiring 
that all Mexican exporters of Sugar agree, as a condition of receiving 
any Export License under the Agreement, not to export directly or 
indirectly to the United States Sugar that is not accompanied by an 
Export License issued pursuant to the Agreement and that each such 
Mexican exporter provide the GOM with a certification that it has 
required all of its customers to agree, as part of the terms of sale, 
not to engage in any circumvention activities specified by this 
Agreement. Circumvention activities may include exporting Sugar from 
Mexico: (1) in excess of the Export Limit in any given Export Limit 
Period; (2) without an Export License; and (3) in a manner that 
requires Mexico to satisfy its needs with imports of sugar from a Third 
Country or Countries. Circumvention activities may also include, but 
are not limited to, any bundling arrangement, swap or other exchange 
where such arrangement is designed to circumvent the basis of the 
Agreement.
    1. If the GOM receives an allegation that circumvention has 
occurred, including an allegation from the Department, the GOM shall 
promptly initiate an inquiry, normally complete the inquiry within 45 
days and notify the Department of the results of the inquiry within 15 
days after the conclusion of the inquiry.
    2. If the GOM determines that a Mexican company has participated in 
a transaction circumventing the Agreement, the GOM shall impose 
penalties upon such company including, but not limited to, denial of 
access to an Export License for Sugar under the Agreement.
    3. If the GOM determines that a Mexican company has participated in 
the circumvention of the Agreement, the GOM shall count against the 
Export Limit for the Export Limit Period in which the circumvention 
took place an amount of Sugar equivalent to the amount involved in such 
circumvention and shall immediately notify the Department of the amount 
deducted. If a sufficient amount is not available in the current Export 
Limit Period, then the remaining amount shall be deducted from the 
subsequent Export Limit Period or Periods.
    B. The Department will investigate any allegations of circumvention 
which are brought to its attention both by asking the GOM to 
investigate such allegations and by itself gathering relevant 
information. The GOM will respond to requests from the Department for 
information relating to such allegations. In distinguishing normal 
arrangements from those which would result in the circumvention of a 
given Export Limit established by the Agreement, the Department will 
take the following factors into account, as deemed appropriate:
    1. Existence of any verbal or written agreement leading to 
circumvention of the Agreement;
    2. Existence and function of any subsidiaries or affiliates of the 
parties involved;
    3. Existence and function of any historical and traditional 
patterns of production and trade among the parties involved, and any 
deviation from such patterns;
    4. Existence of any payments unaccounted for by previous or 
subsequent deliveries, or any payments

[[Page 78049]]

to one party for Sugar delivered or swapped by another party;
    5. Sequence and timing of the arrangements; and
    6. Any other information relevant to the transaction or 
circumstances.
    C. The GOM and the Department shall hold consultations regarding 
anti-circumvention consistent with Section VIII.D.3 of the Agreement.

VIII. Monitoring of the Agreement

A. Import Monitoring

    1. The Department will monitor entries of Sugar from Mexico to 
ensure compliance with Section V of the Agreement.
    2. The Department will review publicly available data and other 
official import data, including, as appropriate, records maintained by 
CBP, to determine whether there have been imports that are inconsistent 
with the provisions of the Agreement. The Department also intends to 
consult with USDA regarding monthly information submitted by 
processors, refiners, and importers of Sugar from Mexico.
    3. The Department will review, as appropriate, data it receives 
through any data exchange program between U.S. and Mexican government 
agencies, to determine whether there have been imports that are 
inconsistent with the provisions of the Agreement.
    4. The Department agrees to discuss with CBP additional mechanisms 
that may be established and administered by CBP to monitor entries of 
Sugar.

B. Compliance Monitoring

    1. The GOM will collect and provide to the Department such 
information as is necessary and appropriate to monitor the 
implementation of, and compliance with, the Agreement, including the 
following:
    a. Within 30 days following the date that the GOM allocates the 
Export Limit for any Export Limit Period, the GOM shall notify the 
Department of each allocation recipient and the volume granted to each 
recipient. The GOM also shall inform the Department of any changes in 
the volume allocated to individual recipients within 30 days of the 
date on which such changes become effective.
    b. The GOM shall collect and provide to the Department information 
on exports to the United States in the format in Appendix II to the 
Agreement and, if requested, on the aggregate quantity and value of 
exports of Sugar to Third Countries. This information will be provided 
on a monthly basis as specified in Appendix II, and will be provided no 
later than 60 days following the end of each month, beginning on 
February 1, 2015 (for the period from the Effective Date through 
December 31, 2015). If the Department has concerns with the shipments 
of a particular exporter, upon request, the GOM will provide 
information related to that exporter on an expedited basis.
    c. The GOM and the Department recognize that the effective 
monitoring of the Agreement may require the GOM to provide information 
in addition to that identified in the Agreement. Accordingly, after 
consulting with the GOM, the Department may request additional 
reporting requirements consistent with U.S. law and regulations during 
the course of the Agreement. The GOM shall also collect and provide to 
the Department, generally within 60 days of the request, any such 
additional information requested by the Department.
    2. The Department has the authority to verify all information 
related to the administration of the Agreement, including all 
information relating to potential circumvention of the Agreement, 
annually or more frequently as deemed necessary. The Department will 
conduct verifications at locations and times it deems appropriate to 
ensure compliance with the terms of the Agreement.
    3. The Department may initiate administrative reviews under section 
751(a) of the Act in the month immediately following the Anniversary 
Month, upon request, or upon its own initiative, to ensure that exports 
of Sugar from Mexico satisfy the requirements of section 704(c)(1) and 
(3) of the Act. The Department may conduct administrative reviews under 
sections 751(b) and (c), and 781 of the Act, as appropriate. The 
Department may perform verifications pursuant to administrative reviews 
conducted under section 751 of the Act.

C. Rejection of Submissions

    The Department may reject: (1) any information submitted after the 
deadlines set forth in the Agreement; (2) any submission that does not 
comply with the filing, format, translation, service, and certification 
of documents requirements under 19 CFR 351.303; (3) submissions that do 
not comply with the procedures for establishing business proprietary 
treatment under 19 CFR 351.304; and (4) submissions that do not comply 
with any other applicable regulations, as appropriate. If information 
is not submitted in a complete and timely fashion or is not fully 
verifiable, the Department may use facts otherwise available for the 
basis of its decision, as it determines appropriate, consistent with 
section 776 of the Act.

D. Consultations

1. Implementation Consultations

    a. If the GOM notifies the Department in writing, or the Department 
otherwise determines, that the GOM for any reason has not satisfied the 
implementation obligations in Section VI of the Agreement, the 
Department will consult with the GOM for a period of up to 60 days to 
ensure that the GOM complies with those obligations within those 60 
days.
    b. If the Department is not satisfied at the conclusion of the 
consultation period that exports of Sugar from Mexico are entering the 
United States in amounts consistent with the Agreement, or entered with 
a valid Export License, the Department may evaluate under section 
351.209 of its regulations, or section 751 of the Act, whether the 
Agreement is being violated, as defined in Section IX of the Agreement.

2. Compliance Consultations

    a. When the Department identifies, through import or compliance 
monitoring or otherwise, that exports of Sugar from Mexico may have 
entered the United States in volumes inconsistent with Section V of the 
Agreement, or without an Export License, the Department will notify the 
GOM. The Department will consult with the GOM for a period of up to 60 
days to establish a factual basis regarding exports that may be 
inconsistent with Section V of the Agreement.
    b. During the consultation period, the Department will examine any 
information that it develops or which is submitted, including 
information requested by the Department, under any provision of the 
Agreement.
    c. If the Department is not satisfied at the conclusion of the 
consultation period that exports of Sugar from Mexico are entering the 
United States in amounts consistent with the Agreement, or entered with 
a valid Export License, the Department may evaluate under section 
351.209 of its regulations, or section 751 of the Act whether the 
Agreement is being violated, as defined in Section IX of the Agreement.

3. Anti-Circumvention Consultations

    a. If the GOM determines that a company from a Third Country has 
circumvented the Agreement and the Department and the GOM agree that no 
Mexican company participated in or had knowledge of such activities, 
then the Department and the GOM shall hold consultations for the 
purpose of sharing information regarding such

[[Page 78050]]

circumvention and reaching mutual agreement on the appropriate measures 
to be taken to eliminate such circumvention. If the Department and the 
GOM are unable to reach mutual agreement within 45 days, then the 
Department may take appropriate measures, such as deducting the amount 
of Sugar involved in such circumvention from the Export Limit for the 
current Export Limit Period or a subsequent Export Limit Period. Before 
taking such measures, the Department will notify the GOM of the facts 
and reasons constituting the basis for the Department's intended action 
and will afford the GOM 15 days in which to comment. Alternatively, the 
Department may evaluate under section 351.209 of its regulations, or 
section 751 of the Act whether the Agreement is being violated, as 
defined in Section IX of the Agreement.
    b. In the event that the Department determines that a Mexican 
company has participated in a transaction circumventing the Agreement, 
the Department and the GOM shall hold consultations for the purpose of 
sharing evidence regarding such circumvention and reaching mutual 
agreement on an appropriate resolution of the problem. If the 
Department and the GOM are unable to reach mutual agreement within 60 
days, the Department may take appropriate measures, such as deducting 
the amount of Sugar involved in such circumvention from the Export 
Limit for the current Export Limit Period (or, if necessary, the 
subsequent Export Limit Period) or instructing U.S. Customs and Border 
Protection to deny entry to any Mexican Sugar sold by the company found 
to be circumventing the Agreement. Before taking such measures, the 
Department will notify the GOM of the basis for the Department's 
intended action and the GOM will comment within 30 days. The Department 
will enter its determinations regarding circumvention into the record 
of the Agreement. Alternatively, the Department may evaluate under 
section 351.209 of its regulations or section 751 of the Act whether 
the Agreement is being violated, as defined in Section IX of the 
Agreement.

4. Operations Consultations

    The Department will consult with the GOM regarding the operation of 
the Agreement. The Department or the GOM may request such consultations 
at any time, including consultations to revise the formula to establish 
the Export Limit.

IX. Violations of the Agreement

    A. If the Department determines that there has been a violation of 
the Agreement or that the Agreement no longer meets the requirements of 
section 704(c) or (d) of the Act, the Department shall take action it 
determines appropriate under section 704(i) of the Act and the 
Department's regulations.
    B. The following activities shall be considered violations of the 
Agreement:
    1. Exports of Sugar from Mexico in amounts greater than the Export 
Limit established in the relevant Export Limit Period.
    2. A significant amount (i.e., 5 percent or more of the Export 
Limit for the relevant Export Limit Period) of Sugar from Mexico 
exported to the United States without an Export License that is not 
reported by the GOM to the Department.
    3. Any other material violation or breach, as determined by the 
Department.

X. Disclosure and Comment

    This section provides the terms for disclosure and comment 
following consultations or during segments of the proceeding not 
involving a review under section 751 of the Act.
    A. The Department may make available to representatives of each 
Interested Party, pursuant to and consistent with 19 CFR 351.304-
351.306, business proprietary information submitted to and/or collected 
by the Department pursuant to the Agreement, as well as the results of 
the Department's analysis of that information.
    B. Under this section, the GOM and any other Interested Party shall 
file all communications and other submissions via the Department's 
Antidumping and Countervailing Duty Centralized Electronic Service 
System (ACCESS), which is available to registered users at https://access.trade.gov and to all parties at the following address:

U.S. Department of Commerce
Central Records Unit, Room 7046
1401 Constitution Ave., NW
Washington, DC 20230

    Such communications and submissions shall be filed consistent with 
the requirements provided in 19 CFR 351.303.

XI. Duration of the Agreement

    A. The Agreement has no scheduled termination date. Termination of 
the suspended investigation shall be considered in accordance with the 
five-year review provisions of section 751(c) of the Act, and section 
351.218 of the Department's regulations.
    B. The GOM or the Department may terminate the Agreement at any 
time. Termination of the Agreement shall be effective no later than 60 
days after the date written notice of termination is provided to the 
Department or the GOM, respectively.
    C. Upon termination, the Department shall follow the procedures 
outlined in section 704(i)(1) of the Act.
    D. The Department will terminate the Agreement in the event that 
the GOM requests continuation of the countervailing duty investigation 
of Sugar from Mexico, or Signatories accounting for a significant 
proportion of exports of Sugar from Mexico request continuation of the 
antidumping investigation of Sugar from Mexico.

XII. Other Provisions

    A. By entering into the Agreement, the GOM does not admit that 
exports of Sugar from Mexico are having or have had an injurious effect 
on Sugar producers in the United States or that the GOM has provided 
countervailable subsidies to sugar producers and exporters in Mexico. 
The GOM agrees that it will not provide any new or additional export or 
import substitution subsidies on Sugar.
    B. As of the Effective Date, the Department shall instruct U.S. 
Customs and Border Protection to refund any cash deposits collected as 
a result of the countervailing duty investigation on Sugar from Mexico. 
The Department shall instruct CBP to terminate the suspension of 
liquidation consistent with section 704(f)(2)(B) of the Act.
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Paul Piquado, Assistant Secretary for Enforcement and Compliance, U.S. 
Department of Commerce

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Date

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Francisco de Rosenzweig Mendialdua, Undersecretary for Foreign Trade, 
Ministry of Economy, Government of Mexico

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Date

Appendix I--Information To Be Contained in Export Licenses

    The GOM will issue shipment-specific Export Licenses to Mexican 
entities that shall contain the following fields:
    1. Export License Number: Indicate the Export License number for 
the shipment.
    2. Name of the Licensee: Indicate the name of the Licensee, and 
the name of the mill, if different from the Licensee.
    3. Name of the Exporter: Indicate the name of the broker/trader 
or mill, as applicable.
    4. Complete Description of Merchandise: Include the applicable 
Harmonized Tariff

[[Page 78051]]

Schedule category and the polarity of the product.
    5. Processing: Indicate ``YES'' if the Sugar is being imported 
for further processing in the United States by a USDA-recognized 
cane refiner and ``NO'' if it is not.
    6. Quantity: Indicate in metric tons raw value and short tons 
raw value.
    7. Date of Export License: Date that the Export License is 
issued.
    8. Date of Expiration of the Export License: Indicate the date 
that the Export License expires.
    9. Port of Export: Indicate the port of export.
    10. Allocation to Mill: Indicate the total amount of the Export 
Limit allocated to the individual mill during the relevant Export 
Limit Period.
    11. Allocation Remaining: Indicate the remaining amount 
available under the allocation to the individual mill during the 
relevant Export Limit Period.

Appendix II--Information on Exports of Sugar From Mexico

    In accordance with the established format, the GOM's license 
issuing authority shall collect and provide to the Department all 
information necessary to ensure compliance with the Agreement. This 
information will be provided to the Department on monthly basis. The 
GOM's license issuing authority will collect and maintain data on 
exports to the United States on a continuous basis. Data for exports 
to countries other than the United States will be reported upon 
request. The GOM's license issuing authority may provide a narrative 
explanation to substantiate all data collected in accordance with 
the following formats.
    The GOM's license issuing authority will provide a report or 
summary regarding all Export Licenses issued to entities, which 
shall contain the following information unless the information is 
unknown to the licensing authority and the licensee. Upon request, 
the GOM will provide copies of any Export License to the Department.
    1. Export License Number: Indicate the Export License number for 
the shipment.
    2. Name of the Licensee: Indicate the name of the Licensee, and 
the name of the mill, if different from the Licensee.
    3. Name of the Exporter: Indicate the name of the broker/trader 
or mill, as applicable.
    4. Complete Description of Merchandise: Include the applicable 
Harmonized Tariff Schedule category and the polarity of the product.
    5. Processing: Indicate ``YES'' if the Sugar is being imported 
for further processing in the United States by a USDA-recognized 
cane refiner and ``NO'' if it is not.
    6. Quantity: Indicate in metric tons raw value and short tons 
raw value.
    7. Date of Export License: Date that the Export License is 
issued.
    8. Date of Expiration of the Export License: Indicate the date 
that the Export License expires.
    9. Port of Export: Indicate the port of export.
    10. Allocation to Mill: Indicate the total amount of the Export 
Limit allocated to the individual mill during the relevant Export 
Limit Period.
    11. Allocation Remaining: Indicate the remaining amount 
available under the allocation to the individual mill during the 
relevant Export Limit Period.
[FR Doc. 2014-30392 Filed 12-24-14; 8:45 am]
BILLING CODE 3510-DS-P