[Federal Register Volume 59, Number 94 (Tuesday, May 17, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-11966]
[[Page Unknown]]
[Federal Register: May 17, 1994]
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DEPARTMENT OF COMMERCE
[C-357-001]
Leather Wearing Apparel From Argentina; Preliminary Results of
Countervailing Duty Administrative Review
AGENCY: International Trade Administration/Import Administration
Department of Commerce.
ACTION: Notice of Preliminary Results of Countervailing Duty
Administrative Review.
SUMMARY: The Department of Commerce is conducting an administrative
review of the countervailing duty order on leather wearing apparel from
Argentina during the period January 1, 1991 through December 31, 1991.
We preliminarily determine the total net subsidy to be zero for all
companies during this review period. We invite interested parties to
comment on these preliminary results.
EFFECTIVE DATE: May 17, 1994.
FOR FURTHER INFORMATION CONTACT: Sylvia Chadwick or Rick Herring,
Office of Countervailing Compliance, International Trade
Administration, U.S. Department of Commerce, Washington, DC 20230;
telephone: (202) 482-2786.
SUPPLEMENTARY INFORMATION:
Background
On March 5, 1992, the Department of Commerce (the Department)
published in the Federal Register a notice of ``Opportunity to Request
Administrative Review'' (57 FR 7910) of the countervailing duty order
on leather wearing apparel (LWA) from Argentina (48 FR 11480; March 18,
1983). On March 19, 1992, the Amalgamated Clothing and Textile Workers
Union (ACTWU), requested an administrative review of the order. We
published the notice of initiation on April 13, 1992 (57 FR 12798)
covering the period January 1, 1991 through December 31, 1991. On April
20, 1992, the government of Argentina (GOA) objected to ACTWU's
request, alleging that ACTWU lacked standing as an interested party as
defined under the law. The GOA neither submitted evidence nor presented
any argument that ACTWU lacked standing. The Department determined that
the ACTWU had standing to request a review pursuant to 19 CFR
355.2(i)(4), as ``a certified or recognized union or group of workers
which is representative of the industry or of sellers * * * in the
United States of the like product produced in the United States.''
ACTWU had participated as an interested party in the original
investigation and subsequent reviews of this case. For further
discussion of the Department's position on the standing of ACTWU to
request a review, see decision memorandum to Joseph A. Spetrini dated
October 15, 1992; ``Interested Party'' Status of Domestic Party
Concerning the Countervailing Duty Order on Leather Wearing Apparel
from Argentina which is on file in the Central Records Unit (room B099
of the Main Commerce Building).
Scope of Review
Imports covered by this review are shipments of Argentine leather
coats, jackets and other apparel including leather vests, pants and
shorts for men, boys, women, girls and infants. Also included are outer
shells and parts and pieces of leather wearing apparel. This
merchandise is classifiable under item number 4203.10.40 of the
Harmonized Tariff Schedule (HTS). The HTS item number is provided for
convenience and Customs purposes. The written description remains
dispositive.
The review period is January 1, 1991 through December 31, 1991.
This review involves one company, Comercio Internacional S.A.C.I.F.I.A.
(Comercio), which accounts for virtually all exports to the U.S., and
nine government programs.
Analysis of Programs
1. Rebate of Indirect Taxes (Reembolso)
The Reembolso program provides a cumulative tax rebate paid upon
export and is calculated as a percentage of the f.o.b. invoice price of
the exported merchandise. As stated in Sec. 355.44(d)(4)(ii) of the
Proposed Regulations (54 FR 23382), the Department will find that the
entire amount of any such rebate is countervailable unless the
following conditions are met: (1) the program operates for the purpose
of rebating prior stage cumulative indirect taxes and/or import
charges; (2) the government accurately ascertained the level of the
rebate; and (3) the government reexamines its schedules periodically to
reflect the amount of actual indirect taxes and/or import charges paid.
In prior investigations and administrative reviews of the Argentine
Reembolso program, the Department determined that these conditions have
been met, and, as such, the entire amount of the rebate has not been
countervailed (see, e.g., Leather Wearing Apparel from Argentina, Final
Results of Countervailing Duty Administrative Review (56 FR 10410;
March 12, 1991); Cold Rolled Carbon Steel Flat-rolled Products from
Argentina, Final Results of Countervailing Duty Administrative Review
(56 FR 28527; June 21, 1991); Oil Country Tubular Goods from Argentina,
Final Results of Countervailing Duty Administrative Review (56 FR
64493; December 10, 1991).
However, once a rebate program meets this threshold, the Department
must still determine in each case whether there is an overrebate; that
is, the Department must still analyze whether the rebate for the
subject merchandise exceeds the total amount of indirect taxes and
import duties borne by inputs that are physically incorporated into the
exported product. If the rebate exceeds the amount of allowable
indirect taxes and import duties, the Department will, pursuant to
Sec. 355.44(d)(4)(i) of the Proposed Regulations, find a
countervailable benefit equal to the difference between the Reembolso
rebate rate and the allowable rate determined by the Department (i.e.,
the overrebate).
To determine whether there was an overrebate during the review
period, the Department requested the Government of Argentina to provide
information on any changes to the Reembolso program for Leather Wearing
Apparel. According to the information provided by the Government of
Argentina, on October 16, 1986, Decree 1555/86 modified the reembolso
program and set precise and transparent guidelines to implement the
refund of indirect taxes and import charges. The decree established
three broad rebate levels covering all products and industry sectors.
The rates for levels I, II and III were 10 percent, 12.5 percent, and
15 percent, respectively. Based on the GOA's 1986 calculation of the
tax incidence in the leather wearing apparel industry, this industry
was classified in level II.
The GOA suspended cash payment of rebates under the reembolso
program in April 1989. Pursuant to the Emergency Economic Law dated
September 25, 1989 (Law 23,697), the suspension of cash payments was
continued for an additional 180 days. Rebates accrued during the
suspension period were to be paid in export credit bonds. On March 4,
1990, the entire program was suspended for 90 days by Decree 435/90.
Decree 1930/90 suspended payments of the reembolso for an additional
12-month period.
Decree 612/91 dated April 10, 1991, reinstated cash payments of the
indirect tax rebates and import charges and reduced the rate for the
leather wearing apparel industry from 12.5 percent to 8.3 percent.
Decree 1011/91 dated May 29, 1991, abolished Decree 1555/86 and
incorporated the reduced rebate rates introduced by Decree 612/91.
Therefore, during the period of review, rebates were suspended from
January through April 10, 1991, and the rebate rate was 8.3 percent
from April 11 through December 31, 1991.
Based on the information provided in the questionnaire response, we
calculated the allowable tax incidence for the subject merchandise
based on the 1986 study which was in effect during the review period.
We found that the rebate of taxes did not exceed the total amount of
allowable cumulative indirect taxes and/or import charges paid on
physically incorporated inputs, and prior stage indirect taxes levied
on the exported product at the final stage of production. Therefore, we
preliminarily determine that there was no benefit from this program
during the review period.
2. Other Programs
Based on the questionnaire responses, we preliminarily determine
that the following programs were not used during the review period: (1)
Drawback of customs duties on imported raw materials used in the
manufacture of LWA; (2) income tax deduction under Decree 173/85; (3)
income tax exemption on exported goods; (4) exemption from stamp-tax;
(5) exemption from or rebate of tariff, tributes or taxes levied on
goods imported under temporary import certificates; (6) exemption from
value-added taxes on exported goods or reimbursement of value-added
taxes on purchases of inputs; (7) pre- or post-export financing
programs; and (8) benefits for exporting from the ports south of the
Rio Colorado.
Preliminary Results of Review
We preliminarily determine the total net subsidy to be zero during
the period January 1, 1991 through December 31, 1991.
If the final results of this review remain the same as these
preliminary results, the Department intends to instruct the Customs
Service not to assess countervailing duties on shipments of the subject
merchandise from all companies, exported on or after January 1, 1991
and on or before December 31, 1991. Further, as provided by section
751(a)(1) of the Act, the Department will instruct Customs not to
collect cash deposits on shipments of this merchandise from all
companies entered or withdrawn from warehouse for consumption on or
after the date of publication of the final results of this
administrative review.
Parties to this proceeding may request disclosure of the
calculation methodology and interested parties may request a hearing
not later than ten days after the date of publication of this notice.
In accordance with 19 CFR 355.38(c)(1)(ii), interested parties may
submit written arguments in case briefs on these preliminary results
within 30 days of the date of publication of this notice. Rebuttal
briefs, limited to arguments raised in case briefs, may be submitted
seven days after the time limit for filing the case brief. Any hearing,
if requested, will be held seven days after the scheduled date for
submission of rebuttal briefs. Copies of case briefs and rebuttal
briefs must be served on interested parties in accordance with 19 CFR
355.38(e).
Representatives of parties to the proceeding may request disclosure
of proprietary information under administrative protective order no
later than 10 days after the representative's client or employer
becomes a party to the proceeding, but in no event later than the date
the case briefs are due under 19 CFR 355.38.
The Department will publish the final results of this
administrative review, including the results of its analysis of issues
raised in any case or rebuttal brief or at a hearing.
This administrative review and notice are being published in
accordance with section 751(a)(1) of the Act (19 U.S.C. 1675(a)(1)) and
19 CFR 355.22.
Dated: May 10, 1994.
Susan G. Esserman,
Assistant Secretary for Import Administration.
[FR Doc. 94-11966 Filed 5-16-94; 8:45 am]
BILLING CODE 3510-DS-P
