[Federal Register Volume 63, Number 230 (Tuesday, December 1, 1998)]
[Notices]
[Pages 66121-66123]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-31983]
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DEPARTMENT OF COMMERCE
International Trade Administration
[C-475-819]
Certain Pasta from Italy: Final Results of New Shipper
Countervailing Duty Administrative Review
AGENCY: Import Administration, International Trade Administration,
Department of Commerce.
ACTION: Notice of Final Results of New Shipper Countervailing Duty
Administrative Review.
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SUMMARY: On Septmember 1, 1998, the Department of Commerce published in
the Federal Register the preliminary results of its new shipper
administrative review of the countervailing duty order on certain pasta
from Italy for the period January 1, 1997, through December 31, 1997.
We have now completed this review and determine the net subsidy to be
0.95 percent ad valorem. We will instruct the Customs Service to assess
countervailing duties with respect to all shipments of the subject
merchandise by Co. R. EX. S.r.L., the new shipper to this review,
entered during this period.
EFFECTIVE DATE: December 1, 1998.
FOR FURTHER INFORMATION CONTACT: Vincent Kane or Sally Hastings, Office
of AD/CVD Enforcement, Group I, Import Administration, U.S. Department
of Commerce, Room 3099, 14th Street and Constitution Avenue, N.W.,
Washington, D.C. 20230; telephone (202) 482-2815 or 482-3464,
respectively.
Applicable Statute: Unless otherwise indicated, all citations to
the statute are references to the provisions of the Tariff Act of 1930,
as amended by the Uruguay Round Agreements Act (URAA), effective
January 1, 1995 (the Act). The Department of Commerce (the Department)
is conducting this administrative review in accordance with section
751(a) of the Act. All other references are to the Department's
regulations codified at 19 CFR Part 351 et seq. Antidumping Duties;
Countervailing Duties; Final Rule 62 FR 27296 (May 19, 1997), unless
otherwise indicated.
SUPPLEMENTARY INFORMATION:
Background
On September 1, 1998, the Department published in the Federal
Register (63 FR 46411) the preliminary results of the new shipper
administrative review of the countervailing duty order on certain pasta
from Italy. The Department has now completed this new shipper
administrative review pursuant to section 751(a)(2)(B) of the Act, and
in accordance with 19 CFR 351.214. We invited interested parties to
comment on the preliminary results. We received no comments. The review
covers CO.R.EX., an exporter of the subject merchandise, and CO.R.EX.'s
subcontractor. (CO.R.EX. does not produce pasta but has a subcontractor
produce pasta for it from semolina supplied by Co.R.EX.) This review
covers 24 programs.
Scope of the Review
The merchandise under review consists of certain non-egg dry pasta
in packages of five pounds (or 2.27 kilograms) or less, whether or not
enriched or fortified or containing milk or other optional ingredients
such as chopped vegetables, vegetable purees, milk, gluten, diastases,
vitamins, coloring and flavorings, and up to two percent egg white. The
pasta covered by this scope is typically sold in the retail market, in
fiberboard or cardboard cartons or polyethyelen or polypropylene bags,
of varying dimensions.
Excluded from the scope of this review are refrigerated, frozen, or
canned pastas, as well as all forms of egg pasta, with the exception of
non-egg dry pasta containing up to two percent egg white. Also excluded
are imports of organic pasta from Italy that are accompanied by the
appropriate certificate issued by one of the following agencies:
Instituto Mediterraneo Di Certificazione, Bioagricoop Scrl pasta
imported in kitchen display bottles of decorative glass, which are
sealed with cork or paraffin and bound with raffia, is excluded from
the scope of this review.
[[Page 66122]]
The merchandise under review is currently classified under item
1902.19.20 of the Harmonized Tariff Schedule of the United States
(HTSUS). Although the HTSUS subheading is provided for convenience and
customs purposes, or written description of the scope of this review is
dispositive.
Furthermore, on July 30, 1998, the Department issued a scope ruling
that multipacks consisting of six one-pound packages of pasta, which
are shrink wrapped into a single package, are within the scope of the
orders. (See July 30, 1998, letter from Susan H. Kunbach, Acting Deputy
Assistant Secretary for Import Administration, to Barbara P. Sidari,
Vice President, Joseph A. Sidari Company, Inc.)
Period of Review
The period of review (``POR'') for which we are measuring subsidies
is calendar year 1997.
Subsidies Valuation Information
Benchmark for Long-term Loans and Discount Rate: The companies
under review did not take out any long-term, fixed-rate, lira-
denominated loans or other debt obligations which could be used as
benchmarks in any of the years in which grants were received or
government loans under investigation were given. In the Final
Affirmative Countervailing Duty Determination; Certain Stainless Steel
Wire Rod from Italy, 63 FR 87077 (July 29, 1998), the Department
determined, based on information gathered during verification, that the
Italian Bankers' Association (ABI) prime rate is the most suitable
benchmark for long-term financing to Italian companies. Therefore, we
used the Italian ABI prime rate increased by the average spread over
the ABI prime rate charged by banks on loans to commercial customers as
the benchmark for long-term loans and the discount rate.
Allocation Period: In British Steel plc. v. United States, 879 F.
Supp. 1254, 1289 (CIT 1955), aff'd in part and rev'd in part on other
grounds, 127 F.3d 1471 (Fed. Cir. 1997), the U.S. Court of
International Trade (the Court) ruled against the allocation
methodology for non-recurring subsidies that the Department had
employed for the past decade, which was articulated in the General
Issues Appendix, appended to the Final Countervailing Duty
Determination; Certain Steel Products from Austria, 58 FR 37225 (July
9, 1993) (``GIA''). In accordance with the Court's remand order, the
Department determined that the most reasonable method of deriving the
allocation period for nonrecurring subsidies is a company-specific
average useful life (``AUL'') of non-renewable physical assets. This
remand determination was affirmed by the Court on July 4, 1996. See
British Steel plc v. United States, 929 F. Supp 426, 439 (CIT 1996).
Accordingly, the Department has applied this method to determine the
appropriate allocation period in this review.
Consistent with our approach in the investigation segment of this
proceeding, Final Affirmative Countervailing Duty Determination:
Certain Pasta (``Pasta'') from Italy (61 FR 30288, June 14, 1996)
(``Pasta from Italy''), we determined that the Law 64/86 grant received
by CO.R.EX.'s subcontractor was non-recurring. For purposes of
allocating the Law 64/86 grant, CO.R.EX.'s subcontractor submitted an
AUL calculation based on depreciation and asset values of productive
assets reported in its financial statements. This AUL was derived by
dividing the sum of average gross book value of depreciable fixed
assets over the past ten years by the average depreciation charges over
this period. We found this calculation to be reasonable and consistent
with our company-specific AUL objective. In this manner, we calculated
an AUL for CO.R.EX.'s subcontractor. We have used this calculated AUL
for the allocation period for the Law 64/86 industrial development
grant, the only non-recurring subsidy received by respondents.
Analysis of Programs
I. Programs Conferring Subsidies
Based upon our analysis of the responses to our questionnaires and
the record of this review, we determine the following:
Programs Previously Determined to Confer Subsidies
In the preliminary results, we found that the programs listed below
conferred countervailable benefits on the subject merchandise. We did
not receive any comments on these programs from interested parties. Our
review of the record, however, has led us to modify the calculations
for each of these programs. First, we revised the denominator used to
calculate the subsidy rate for each of the programs listed below. For
the preliminary results, we based the denominator on f.o.b. sales
values calculated on the basis of estimates of inland freight charges.
For these final results, we have used actual inland freight charges in
calculating f.o.b. sales values. These revised f.o.b. sales values
served as the denominators for calculating the subsidy rate for each of
these programs.
Further, we corrected an error in the calculation of the discount
rate used to allocate the benefit amount for a Law 64/86 industrial
development grant to CO.R.EX.'s subcontractor and for the Law 341/95
consolidation loan received by CO.R.EX. For a further discussion of
this correction, see Memorandum to File: Calculation Notes for Final
Results, dated November 22, 1998 (a public version of which is on file
in room B099 of the main Commerce Building).
As a result of the calculation changes described above, the subsidy
rates for the programs listed below changed as follows:
A. Industrial Development Grants Under Law 64/86
The subsidy rate for this program decreased from 0.18 percent to
0.15 percent ad valorem.
B. Social Security Reductions and Exemptions
1. Sgravi Benefits
The subsidy rate for this program decreased from 0.01 percent to
0.00 percent ad valorem.
2. Fiscalizzazione Benefits
The subsidy rate for this program decreased from 0.06 percent to
0.04 percent ad valorem.
3. Law 407/90 Benefits
The subsidy rate for this program decreased from 0.06 percent to
0.04 percent ad valorem.
4. Law 863 Benefits
The subsidy rate for this program decreased from 0.03 percent to
0.01 percent ad valorem.
Program Determined in This Review to Confer Subsidies
In the preliminary results, we found that the program listed below
conferred countervailable benefits on the subject merchandise. We did
not receive any comments on this program from interested parties. Our
review of the record, however, has led us to modify the calculations
for this program, as described above in the section.
Programs Previously Determined to Confer Subsidies
Debt Consolidation Law 341/95
The subsidy rate for this program decreased from 0.93 percent to
0.88 percent ad valorem.
II. Programs Determined To Be Not Used
We determine that CO.R.EX. and its subcontractor did not apply for
or
[[Page 66123]]
receive benefits under the following programs during the POR:
A. VAT Reductions
B. Export Credits Under Law 227/77
C. Capital Grants Under Law 675/77
D. Retraining Grants Under Law 675/77
E. Interest Contributions on Bank Loans Under Law 675/77
F. Interest Grants Financed by IRI Bonds
G. Preferential Financing for Export Promotion Under Law 394/81
H. Corporate Income Tax (IRPEG) Exemptions
I. European Agricultural Guidance and Guarantee Fund
J. Urban Redevelopment Under Law 181
K. Local Income Tax (ILOR) Exemptions
L. Industrial Development Loans Under Law 64/86
M. Export Marketing Grants Under Law 304/90
N. Lump-Sum Interest Payment Under the Sabatini Law for Companies in
Southern Italy
O. Remission of Taxes on Export Credit Insurance under Article 33 of
Law 227/77
P. European Social Fund
Q. European Regional Development Fund
R. Export Restitution Payments
We did not receive any comments on these programs from the
interested parties and our review of the record has not led us to
change our findings from the preliminary results.
Final Results of Review
For the period January 1, 1997 through December 31, 1997, we
determine the net subsidy for CO.R.EX. to be 0.95 percent ad valorem.
We will instruct the Customs Service to assess countervailing duties at
this net subsidy rate on all entries of the subject merchandise from
CO.R.EX. entered, or withdraw from warehouse, for consumption on or
after January 1, 1997 and on or before December 31, 1997.
The Department also intends to instruct the Customs Service to
collect a cash deposit of estimated countervailing duties of 0.95
percent of the f.o.b. invoice value on all shipments of the subject
merchandise from CO.R.EX. entered, or withdrawn from warehouse, for
consumption on or after the date of publication of the final results of
this new shipper review. The cash deposit rates for all other
producers/exporters remain unchanged from the last completed
administrative review (see Final Results of Countervailing Duty
Administrative Review: Certain Pasta from Italy 63 FR 35665 (August 14,
1998)).
This administrative review and notice are in accordance with
sections 751(a) (2) (B) and 777 (i) (1) of the Act and 19 CFR 351.214.
Dated: November 23, 1998.
Robert S. LaRussa,
Assistant Secretary for Import Administration.
[FR Doc. 98-31983 Filed 11-30-98; 8:45 am]
BILLING CODE 3510-DS-M
