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Mexico Fresh Tomatoes Antidumping Investigation Suspension Agreement

[Federal Register: January 28, 2008 (Volume 73, Number 18)]

[Notices]

[Page 4831-4840]

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

[DOCID:fr28ja08-35]

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DEPARTMENT OF COMMERCE

International Trade Administration

[A-201-820]

Suspension of Antidumping Investigation: Fresh Tomatoes From

Mexico

AGENCY: Import Administration, International Trade Administration,

Department of Commerce.

ACTION: Notice of suspension of antidumping investigation on fresh

tomatoes from Mexico.

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EFFECTIVE DATE: January 22, 2008.

SUMMARY: The Department of Commerce has suspended the antidumping

investigation involving fresh tomatoes from Mexico. The basis for the

suspension of the antidumping investigation is an agreement between the

Department of Commerce and producers/exporters accounting for

substantially all imports of fresh tomatoes from Mexico wherein each

signatory producer/exporter has agreed to revise its prices to

eliminate completely the injurious effects of exports of this

merchandise to the United States.

FOR FURTHER INFORMATION CONTACT: Judith Wey Rudman or Jay Carreiro at

(202) 482-0192 or (202) 482-3674, respectively; Office of Policy,

Import Administration, International Trade Administration, U.S.

Department of Commerce, 14th Street & Constitution Avenue, NW.,

Washington, DC 20230.

SUPPLEMENTARY INFORMATION:

Applicable Statute and Regulations

Unless otherwise indicated, all citations to the statute are

references to the provisions effective January 1, 1995, the effective

date of the amendments made to the Tariff Act of 1930 (the Act) by the

Uruguay Round Agreements Act. In addition, unless otherwise indicated,

all citations to Department of Commerce (Department) regulations refer

to the regulations codified at 19 CFR part 353 (1996).

Background

On April 18, 1996, the Department initiated an antidumping

investigation to determine whether imports of fresh tomatoes from

Mexico are being, or are likely to be, sold in the United States at

less than fair value (LTFV) (61 FR 18377, April 25, 1996). On May 16,

1996, the United States International Trade Commission (ITC) notified

the Department of its affirmative preliminary injury determination.

On October 10, 1996, the Department and Mexican tomato growers/

exporters initialed a proposed agreement suspending the antidumping

investigation. On October 28, 1996, the Department preliminarily

determined that imports of fresh tomatoes from Mexico are being sold at

LTFV in the United States. See Notice of Preliminary Determination of

Sales at Less Than Fair Value and Postponement of Final Determination:

Fresh Tomatoes from Mexico, 61 FR 56608 (November 1, 1996) (Preliminary

Determination). On the same day the Preliminary Determination was

signed, the Department and certain growers/exporters of fresh tomatoes

from Mexico signed an agreement to suspend the investigation (1996

Suspension Agreement). See Suspension of Antidumping Investigation:

Fresh Tomatoes from Mexico, 61 FR 56618 (November 1, 1996).

On May 31, 2002, Mexican tomato growers/exporters accounting for a

significant percentage of all fresh tomatoes imported into the United

States from Mexico provided written notice to the Department of their

withdrawal from the 1996 Suspension Agreement, effective July 30, 2002.

Because the 1996 Suspension Agreement would no longer cover

substantially all imports of fresh tomatoes from Mexico, effective July

30, 2002, the Department terminated the

[[Page 4832]]

1996 Suspension Agreement, terminated the sunset review of the

suspended investigation, and resumed the antidumping investigation. See

Notice of Termination of Suspension Agreement, Termination of Sunset

Review, and Resumption of Antidumping Investigation: Fresh Tomatoes

from Mexico, 67 FR 50858 (August 6, 2002).

On November 8, 2002, the Department and Mexican tomato growers/

exporters initialed a proposed agreement suspending the resumed

antidumping investigation on imports of fresh tomatoes from Mexico. On

December 4, 2002, the Department and certain growers/exporters of fresh

tomatoes from Mexico signed a new suspension agreement (``2002

Suspension Agreement''). See Suspension of Antidumping Investigation:

Fresh Tomatoes From Mexico, 67 FR 77044 (December 16, 2002). On

November 3, 2003, the Department published the Final Results of

Analysis of Reference Prices and Clarifications and Corrections;

Agreement Suspending the Antidumping Duty Investigation on Fresh

Tomatoes From Mexico, 68 FR 62281 (November 3, 2003).

On November 26, 2007, Mexican tomato growers/exporters accounting

for a significant percentage of all fresh tomatoes imported into the

United States from Mexico provided written notice to the Department of

their withdrawal from the 2002 Suspension Agreement, effective 90 days

from the date of their withdrawal letter (i.e., February 24, 2008), or

earlier, at the Department's discretion.

On November 28, 2007, the Department and Mexican tomato growers/

exporters initialed a new proposed agreement to suspend the antidumping

investigation on imports of fresh tomatoes from Mexico. On December 3,

2007, the Department released the initialed agreement to interested

parties and afforded them an opportunity to comment on the initialed

agreement. On December 17 and 18, 2007, several interested parties

filed comments in support of the initialed agreement.

Because the 2002 Suspension Agreement would no longer cover

substantially all imports of fresh tomatoes from Mexico, the Department

published a notice of intent to terminate the 2002 Suspension

Agreement, intent to terminate the five-year sunset review of the

suspended investigation, and intent to resume the antidumping

investigation. See Fresh Tomatoes from Mexico: Notice of Intent to

Terminate Suspension Agreement, Intent to Terminate the Five-Year

Sunset Review, and Intent to Resume Antidumping Investigation, 72 FR

70820 (December 13, 2007). On January 16, 2008, the Department

published a notice of termination of the 2002 Suspension Agreement,

termination of the five-year sunset review of the suspended

investigation, and resumption of the antidumping investigation,

effective January 18, 2008. See Fresh Tomatoes from Mexico: Notice of

Termination of Suspension Agreement, Termination of Five-Year Sunset

Review, and Resumption of Antidumping Investigation, 73 FR 2887,

(January 16, 2008).

On January 22, 2008, the Department signed a new suspension

agreement (2008 Suspension Agreement) with certain growers/exporters of

fresh tomatoes from Mexico. The 2008 Suspension Agreement is attached

to this notice of Suspension of Antidumping Investigation.

Scope of the Agreement

The merchandise subject to this Agreement is all fresh or chilled

tomatoes (fresh tomatoes) which have Mexico as their origin, except for

those tomatoes which are for processing. For purposes of this

Agreement, processing is defined to include preserving by any

commercial process, such as canning, dehydrating, drying, or the

addition of chemical substances, or converting the tomato product into

juices, sauces, or purees. Fresh tomatoes that are imported for cutting

up, not further processing (e.g., tomatoes used in the preparation of

fresh salsa or salad bars), are covered by this Agreement.

Commercially grown tomatoes, both for the fresh market and for

processing, are classified as Lycopersicon esculentum. Important

commercial varieties of fresh tomatoes include common round, cherry,

grape, plum, greenhouse, and pear tomatoes, all of which are covered by

this Agreement.

Tomatoes imported from Mexico covered by this Agreement are

classified under the following subheadings of the Harmonized Tariff

Schedules of the United States (HTSUS), according to the season of

importation: 0702 and 9906.07.01 through 9906.07.09. Although the HTSUS

numbers are provided for convenience and customs purposes, the written

description of the scope of this Agreement is dispositive.

Suspension of Investigation

The Department consulted with the parties to the proceeding and has

considered the comments submitted with respect to the proposal to

suspend the antidumping investigation. In accordance with section

734(c) of the Act, we have determined that extraordinary circumstances

are present in this case, as defined by section 734(c)(2)(A) of the

Act. See the memorandum titled ``Existence of Extraordinary

Circumstances'' from Ronald K. Lorentzen, Acting Deputy Assistant

Secretary for Policy and Negotiations, to David M. Spooner, Assistant

Secretary for Import Administration.

The 2008 Suspension Agreement provides that the subject merchandise

will be sold at or above the established reference price and, for each

entry of each exporter, the amount by which the estimated normal value

exceeds the export price (or constructed export price) will not exceed

15 percent of the weighted-average amount by which the estimated normal

value exceeded the export price (or constructed export price) for all

LTFV entries of the producer/exporter examined during the course of the

investigation. We have determined that the 2008 Suspension Agreement

will eliminate completely the injurious effect of exports to the United

States of the subject merchandise and prevent the suppression or

undercutting of price levels of domestic fresh tomatoes by imports of

that merchandise from Mexico.

We have also determined that the 2008 Suspension Agreement is in

the public interest and can be monitored effectively, as required under

section 734(d) of the Act. See the memorandum titled ``Public Interest

Assessment of the Agreement Suspending the Antidumping Duty

Investigation on Fresh Tomatoes from Mexico'' from Ronald K. Lorentzen,

Acting Deputy Assistant Secretary for Policy and Negotiations, to David

M. Spooner, Assistant Secretary for Import Administration.

For the reasons outlined above, we find that the 2008 Suspension

Agreement meets the criteria of section 734(c) of the Act.

International Trade Commission

In accordance with section 734(f) of the Act, the Department has

notified the ITC of the 2008 Suspension Agreement.

Suspension of Liquidation

The suspension of liquidation ordered in the preliminary

affirmative determination in this case published on November 1, 1996,

and resumed on January 18, 2008 (see 73 FR 2887), shall continue to be

in effect, subject to section 734(h)(3) of the Act. Section

734(f)(2)(B) of the Act provides that the Department may adjust the

security required to reflect the effect of the 2008

[[Page 4833]]

Suspension Agreement. The Department has found that the 2008 Suspension

Agreement eliminates completely the injurious effects of imports and,

thus, the Department is adjusting the security required from

signatories to zero. The security rates in effect for imports from non-

signatory growers remain as published in the Preliminary Determination.

Notwithstanding the 2008 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 734(g) of the Act.

Administrative Protective Order Access

The Administrative Protective Orders (APOs) the Department granted

in the original investigation segment of this proceeding remain in

place. While the investigation is suspended, parties subject to those

APOs may retain, but may not use, information received under those

APOs. All parties wishing access to business proprietary information

submitted during the administration of the 2008 Suspension Agreement

must submit new APO applications. An APO for the administration of the

2008 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 publishing this notice in accordance with section 734 of the

Act and 19 CFR 353.18.

Dated: January 22, 2008.

David M. Spooner,

Assistant Secretary for Import Administration.

Attachment.

Suspension of Antidumping Investigation: Fresh Tomatoes From Mexico

Pursuant to section 734(c) of the Tariff Act of 1930, as amended

(19 U.S.C. 1673c(c)) (``the Act''), and section 353.18 of the U.S.

Department of Commerce (``the Department'') regulations (19 CFR 353.18

(1996)), the Department and the signatory producers/exporters of fresh

tomatoes from Mexico enter into this Suspension Agreement (the

``Agreement''). On the basis of this Agreement, the Department shall

suspend its antidumping duty investigation, the initiation of which was

published on April 25, 1996 (61 FR 18377), with respect to fresh

tomatoes from Mexico, subject to the terms and provisions set out

below.

I. Product Coverage

The merchandise subject to this Agreement is all fresh or chilled

tomatoes (fresh tomatoes) which have Mexico as their origin, except for

those tomatoes which are for processing. For purposes of this

Agreement, processing is defined to include preserving by any

commercial process, such as canning, dehydrating, drying, or the

addition of chemical substances, or converting the tomato product into

juices, sauces, or purees. In Appendix F of this Agreement the

Department has outlined the procedure that signatories must follow for

selling subject merchandise for processing. Fresh tomatoes that are

imported for cutting up, not further processing (e.g., tomatoes used in

the preparation of fresh salsa or salad bars), are covered by this

Agreement.

Commercially grown tomatoes, both for the fresh market and for

processing, are classified as Lycopersicon esculentum. Important

commercial varieties of fresh tomatoes include common round, cherry,

grape, plum, greenhouse, and pear tomatoes, all of which are covered by

this Agreement.

Tomatoes imported from Mexico covered by this Agreement are

classified under the following subheadings of the Harmonized Tariff

Schedules of the United States (HTSUS), according to the season of

importation: 0702 and 9906.07.01 through 9906.07.09. Although the HTSUS

numbers are provided for convenience and customs purposes, the written

description of the scope of this Agreement is dispositive.

II. U.S. Import Coverage

The signatories are the producers and exporters in Mexico which

account for substantially all of the subject merchandise imported into

the United States. The Department may at any time 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 subject to the Agreement.

III. Basis for the Agreement

Each signatory individually agrees that, in order to prevent price

suppression or undercutting, it will not sell, on and after the

effective date of the Agreement, merchandise subject to the Agreement

at prices that are less than the reference price, in accordance with

Appendix A to this Agreement.

In order to satisfy the requirements of section 734(c)(1)(B) of the

Act, each signatory agrees individually that for each entry the amount

by which the estimated normal value exceeds the export price (or the

constructed export price) will not exceed 15 percent of the weighted-

average amount by which the estimated normal value exceeded the export

price (or the constructed export price) for all less-than-fair-value

entries of the producer/exporter examined during the course of the

investigation, in accordance with the calculation methodologies

described in Appendix B of this Agreement.

IV. Monitoring of the Agreement

A. Import Monitoring

1. The Department will monitor entries of fresh tomatoes from

Mexico to ensure compliance with section III of this Agreement.

2. The Department will review publicly available data and other

official import data, including, as appropriate, records maintained by

U.S. Customs and Border Protection, to determine whether there have

been imports that are inconsistent with the provisions of this

Agreement.

B. Compliance Monitoring

1. The Department may require, and each signatory agrees to

provide, confirmation, through documentation provided to the

Department, that the price received on any sale subject to this

Agreement was not less than the established reference price. The

Department may require that such documentation be provided, and be

subject to verification, within thirty days of the sale.

2. The Department may require, and each signatory agrees to report

in the prescribed format and using the prescribed method of data

compilation, each sale of the merchandise subject to this Agreement,

either directly or indirectly to unrelated purchasers in the United

States, including each adjustment applicable to each sale, as specified

by the Department.

Each signatory agrees to permit review and on-site inspection of

all information deemed necessary by the Department to verify the

reported information.

3. The Department may conduct administrative reviews under section

751 of the Act, upon request or upon its own initiative, to ensure that

exports of fresh tomatoes from Mexico are at prices consistent with the

terms of this Agreement. The Department may perform verifications

pursuant to administrative reviews conducted under section 751 of the

Act.

4. At any time, and without prior notice, the Department may

conduct verifications of parties handling signatory merchandise to

determine

[[Page 4834]]

whether they are selling signatory merchandise in accordance with the

terms of this Agreement.

C. Shipping and Other Arrangements

1. All reference prices will be expressed in U.S.$/lb. in

accordance with Appendix A of this Agreement. Subject to paragraph 24

of Annex 703.2 of the North American Free Trade Agreement, the quality

of each entry of fresh tomatoes exported to the United States from

Mexico will conform with any applicable U.S. Department of Agriculture

minimum grade, size, and/or quality import requirements in effect.

2. Signatories agree not to circumvent the Agreement and to

undertake measures that will help to prevent circumvention. For

example, each signatory will take the following actions:

a. It is the responsibility of all signatories to ensure that sales

of their merchandise are made consistent with the requirements of this

Agreement. To that end, each signatory shall enter into a contract,

with the party that is responsible for the first sale of its subject

merchandise to an unaffiliated customer in the United States (the

Selling Agent),\1\ that incorporates the terms of this Agreement.

Through a contractual arrangement signatories shall also require the

Selling Agent establish a contract with third parties to ensure that

adjustments for spoilage or other claims inconsistent with the

Agreement will not be permitted. Further, this contractual arrangement

must establish that the Selling Agent maintain documentation

demonstrating that sales of their merchandise are made consistent with

the requirements of this Agreement.

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\1\ The Selling Agent can be an importer, agent, broker,

distributor, or any other entity that facilitates the transaction

between the signatory and the first unaffiliated U.S. customer.

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b. Each signatory will label its boxes of subject merchandise that

are exported to the United States with its name, signatory

identification number, and a statement that ``These Tomatoes Were

Grown/Exported By a Signatory of the 2008 Suspension Agreement.'' \2\

Alternatively, if the signatory that exports the tomatoes is different

from the entity that grew the tomatoes, it will label the boxes with

its name and its signatory identification number.

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\2\ Signatories may continue to use boxes with markings from the

2002 Suspension Agreement through December 31, 2008.

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c. Each signatory will label its boxes of fresh tomatoes sold in

Mexico with its name and the title ``Prohibida Su Exportacion''.

3. Not later than thirty days after each quarter, each signatory

will submit a written statement to the Department certifying that all

sales during the most recently completed quarter were at net prices

(after rebates, backbilling, discounts for quality and other claims) at

or above the reference price and were not part of or related to any act

or practice which would have the effect of hiding the real price of the

fresh tomatoes being sold (e.g., a bundling arrangement, discounts/free

goods/financing package, swap, or other exchange). Each signatory

agrees to permit full verification of its certification as the

Department deems necessary.

D. Rejection of Submissions

The Department may reject: (1) Any information submitted after the

deadlines set forth in this Agreement; (2) any submission that does not

comply with the filing, format, translation, service, and certification

of documents requirements under 19 CFR 353.31; (3) submissions that do

not comply with the procedures for establishing business proprietary

treatment under 19 CFR 353.32, or any information that 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 use the facts otherwise available for the basis of its decision, as

it determines appropriate, unless the Department determines that

section V. applies.

E. Compliance Consultations

1. When the Department identifies, through import or compliance

monitoring or otherwise, that sales may have been made at prices

inconsistent with section III of this Agreement, the Department will

notify each signatory which it believes is responsible or, if

applicable, notify the signatory's representative. The Department will

consult with each such party for a period of up to sixty days to

establish a factual basis regarding sales that may be inconsistent with

section III of this Agreement.

2. During the consultation period, the Department will examine any

information that it develops or which is submitted, including

information requested by the Department under sections IV.A. and B.

above.

F. Review

If the Department is not satisfied at the conclusion of the

consultation period that sales by such signatory are being made in

compliance with this Agreement, the Department may conduct a review to

determine whether this Agreement is being violated by such signatory.

This provision does not limit or restrict the Department's authority to

conduct an administrative review under section 751 of the Act and

paragraph IV.B.3. of this Agreement.

G. Operations Consultations

The Department will consult with the signatory producers/exporters

regarding the operations of this Agreement. A party to the Agreement

may request such consultations in any April or September (i.e., prior

to the beginning of each season) following the first year of the

signing of this Agreement. Consistent with the statutory requirement

that the Agreement prevent the suppression or undercutting of price

levels of domestic fresh tomatoes, the Department may revise the

reference price following consultations under this provision.

In order to evaluate whether this Agreement fulfills the

requirements of section 734(c)(1)(B) of the Act, the Department may

conduct an administrative review under section 751 of the Act, upon

request or upon its own initiative, to ensure that for each entry of

each exporter the amount by which the estimated normal value exceeds

the export price (or the constructed export price) did not exceed 15

percent of the weighted-average amount by which the estimated normal

value exceeded the export price (or the constructed export price) for

all less-than-fair-value entries of the producer/exporter examined

during the course of the investigation, in accordance with the

calculation methodologies described in Appendix B. An affirmative

determination under section 751 of the Act may result in the

termination of this Agreement.

V. Violations of the Agreement

A. If the Department determines that the Agreement is being or has

been violated or no longer meets the requirements of sections 734(c) or

(d) of the Act, the Department shall take action it determines

appropriate under section 734(i) of the Act and the Department's

regulations.

B. Pursuant to section 734(i) of the Act the Department will refer

any intentional violations of the Agreement to U.S. Customs and Border

Protection. Any person who intentionally violates the Agreement shall

be subject to a civil penalty assessed in the same amount, in the same

manner, and under the same procedures as the penalty imposed for a

fraudulent violation of section 592(a) of the Act. A fraudulent

violation of section 592(a) of the Act is punishable by a civil penalty

in an amount not to exceed the domestic value of the

[[Page 4835]]

merchandise. For purposes of the Agreement, the domestic value of the

merchandise will be deemed to be the reference price, as the

signatories agree not to sell the subject merchandise at prices that

are less than the reference price or to ensure that sales of the

subject merchandise are made consistent with the terms of the

Agreement.

C. In addition, the Department will examine the activities of

signatories, their Selling Agents, and any other party to a sale

subject to the Agreement to determine whether any activities conducted

by any party aided or abetted another party's violation of the

Agreement. If any such parties are found to have aided or abetted

another party's violation of the Agreement, they shall be subject to

the same civil penalties described in section V.B. above.

Signatories of this Agreement consent to the release of all

information presented to or obtained by the Department during the

conduct of verifications with U.S. Customs and Border Protection and/or

the U.S. Department of Agriculture. Further, through a contractual

arrangement, signatories shall require that the Selling Agent consent

to the release of all information presented to or obtained by the

Department during the conduct of verifications with U.S. Customs and

Border Protection and/or the U.S. Department of Agriculture.

D. The following activities shall be considered violations of the

Agreement:

1. Sales that are at net prices (after rebates, backbilling,

discounts for quality and other claims) that are below the reference

price.

2. Any act or practice which would have the effect of hiding the

real price of the fresh tomatoes being sold (e.g., a bundling

arrangement, discounts/free goods financing package, swap, or other

exchange).

3. Sales that are not in accordance with the terms and conditions

applied by the Department when calculating prices for transactions

involving adjustments due to changes in condition after shipment as

detailed in Appendix D of this Agreement.

4. Selling signatory tomatoes to Canada in a manner that is not

consistent with the requirements of Appendix E of this Agreement.

5. Selling signatory tomatoes for processing in the United States

in a manner that is not consistent with the requirements of Appendix F

of this Agreement.

6. Any other act or practice that the Department or U.S. Customs

and Border Protection finds in violation of the Agreement.

VI. Other Provisions

A. In entering into this Agreement the signatories do not admit

that any exports of fresh tomatoes from Mexico are having or have had

an injurious effect on fresh tomato producers in the United States or

have been sold at less than fair value. The signatories also do not

admit that greenhouse, cherry, or any other particular type of tomatoes

are properly considered within the scope of the underlying

investigation.

B. The signatories may withdraw from this Agreement upon ninety

days written notice to the Department.

C. Upon request, the Department will advise any signatory of the

Department's methodology for calculating its export price (or

constructed export price) and normal value, which, for purposes of this

Agreement, are described in Appendix B of this Agreement. Further, the

Department reserves the right to modify its methodology in calculating

export price (or constructed export price) and normal value.

VII. Disclosure and Comment

A. If the Department proposes to revise the reference price as a

result of consultations under this Agreement, not later than three

months prior to the first day of each semi-annual period, the

Department will disclose the results and the methodology of the

Department's calculation of the preliminary reference price established

for that upcoming semi-annual period.

B. Not later than seven days after the date of disclosure under

paragraph VII.A., the parties to the proceeding may submit written

comments to the Department, not to exceed fifteen pages. After

reviewing these submissions, the Department will provide the final

reference price for the upcoming semi-annual period, normally within

thirty days after the date of disclosure under paragraph VII.A.

C. The Department may make available to representatives of each

interested party to the proceeding, under appropriately drawn

administrative protective orders, any business proprietary information

submitted to the Department pursuant to section IV. of this Agreement,

as well as the results of the Department's analysis of that

information.

VIII. Termination

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.

IX. Effective Date

The effective date of the Agreement is January 22, 2008.

David M. Spooner,

Assistant Secretary for Import Administration.

Dated: January 22, 2008.

The following parties hereby certify that the members of their

organization agree to abide by all terms of the Agreement:

Ing. Manuel Esteban Tarriba Urtuzuastegui, President.

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(Name and Title of Certifying Official)

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(Signature of Certifying Official)

For CAADES, Sinaloa, A.C.

Dated: January 10th 2008.

Victor Rodr[iacute]guez Hern[aacute]ndez, President

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(Name and Title of Certifying Official)

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(Signature of Certifying Official)

For Consejo Agricola de Baja California, A.C.

Dated: January 14th 2008.

Cesar Campana Acosta, President

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(Name and Title of Certifying Official)

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(Signature of Certifying Official)

For Asociacion Mexicana de Horticultura Protegida, A.C.

Dated: January 10th of 2008.

Gaspar Zaragoza Yberri, President

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(Name and Title of Certifying Official)

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(Signature of Certifying Official)

For Union Agricola Regional de Sonora, Productores de Hortalizas

Frutas y Legumbres

Dated: January 11 of 2008.

Basilio Gatzionis Torres, President

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(Name and Title of Certifying Official)

(Signature of Certifying Official)-------------------------------------

For Confederacion Nacional de Productores de Hortalizas

Dated: January 9, 2008.

Appendix A--Suspension of Antidumping Investigation--Fresh Tomatoes

From Mexico--Reference Price

Consistent with the requirements of section 734(c) of the Act,

to eliminate completely the injurious effect of exports to the

United States and to prevent the suppression or undercutting of

price levels of domestic fresh tomatoes, the Department and

signatory producer/exporters of subject merchandise hereby agree to

adopt the reference prices calculated based on the methodology

outlined in the November 1, 1996, agreement suspending the

antidumping investigation involving fresh tomatoes from Mexico, as

amended on August 14, 1998. See Suspension of Antidumping

Investigation; Fresh Tomatoes from Mexico, 61 FR 56618,

[[Page 4836]]

56620 (November 1, 1996), October 28, 1996, Memorandum to Robert S.

LaRussa titled ``The Prevention of Price Suppression or Undercutting

of Price Levels in the Suspension Agreement Covering Fresh Tomatoes

from Mexico,'' Amendment to the Suspension Agreement on Fresh

Tomatoes from Mexico, 63 FR 43674 (August 14, 1998), and Final

Results of Analysis of Reference Prices and Clarifications and

Corrections; Agreement Suspending the Antidumping Duty Investigation

on Fresh Tomatoes from Mexico, 68 FR 62281 (November 3, 2003).

Accordingly, the reference price for the July 1 through October 22

period will be $0.172 per pound and the reference price for the

October 23 through June 30 period will be $0.2169 per pound.

These reference prices will remain in effect unless modified in

accordance with the provisions of paragraph IV.G. of the Agreement.

The term ``reference price'' refers to the price F.O.B. from the

Selling Agent. The reference price includes all palletizing and

cooling charges incurred prior to shipment from the Selling Agent.

The actual movement or handling expenses beyond the point of entry

into the United States (e.g., McAllen, Nogales, Otay Mesa) must be

added to the reference price and must reflect the cost for an arm's-

length transaction. The chart below contains examples of certain

minimum common trucking charges the USDA observed during the 2007

winter season.

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F.O.B. Nogales to: Los Angeles New York Chicago

----------------------------------------------------------------------------------------------------------------

Rate ($US)/Per Truckload........................................ $900 $5,000 $3,200

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Parties should refer to http://www.ams.usda.gov/fv/mncs/

fvwires.htm to obtain examples of common trucking charges pertinent

to the current season. Where the Selling Agent sells through an

affiliated party, the transfer price from the Selling Agent to the

affiliate must be at or above the reference price and any subsequent

sale to an unaffiliated party must include the actual cost of

markups (e.g., trucking charges) that reflect arm's-length costs.

For guidance on the trucking-charge markup for such resales, parties

should also refer to http://www.ams.usda.gov/fv/mncs/fvwires.htm to

obtain common trucking charges pertinent to the current season.

During the Department's verifications of parties handling

signatory merchandise it will ascertain whether (1) the handling

expenses beyond the point of entry into the United States are added

to the reference price and reflect the actual cost for an arm's-

length transaction and (2) the transfer price from Selling Agents to

their affiliates are at or above the reference price and any

subsequent sale to an unaffiliated party includes markups (e.g.,

trucking charges) that reflect arm's-length costs.

The reference price for each type of box shall be determined

based on the average weights stated in the chart contained in

Appendix C of the Agreement.

Appendix B--Suspension of Antidumping Investigation--Fresh Tomatoes

From Mexico--Analysis of Prices at Less Than Fair Value

A. Normal Value

The cost or price information reported to the Department that

will form the basis of the normal value (NV) calculations for

purposes of the Agreement must be comprehensive in nature and based

on a reliable accounting system (e.g., a system based on well-

established standards and can be tied either to the audited

financial statements or to the tax return filed with the Mexican

government).

1. Based on Sales Prices in the Comparison Market

When the Department bases normal value on sales prices, such

prices will be the prices at which the foreign like product is first

sold for consumption in the comparison market in the usual

commercial quantities and in the ordinary course of trade. Also, to

the extent practicable, the comparison shall be made at the same

level of trade as the export price (EP) or constructed export price

(CEP). The calculation of normal value based on a sales price in the

comparison market will vary depending on whether the comparison is

price-to-EP or price-to-CEP.

2. Constructed Value

When normal value is based on constructed value, the Department

will compute constructed values (CVs) for each growing season based

on the sum of each respondent's growing and harvesting costs for

each type of tomato, plus amounts for selling, general and

administrative expenses (SG&A), U.S. packing costs, and profit. The

Department will collect this cost data for an entire growing season

in order to determine the accurate per-unit CV of that growing

season.

Calculation of CV:

+ Direct Materials

+ Direct Labor

+ Factory overhead

= Cost of Manufacturing

+ Home Market SG&A*

= Cost of Production

+ U.S. Packing

+ Profit*

= Constructed Value (CV)

* SG&A and profit are based on home-market sales of the foreign

like product made in the ordinary course of trade.

B. Export Price and Constructed Export Price

EP and CEP refer to the two types of calculated prices for

merchandise imported into the United States. Both EP and CEP are

based on the price at which the subject merchandise is first sold to

a person not affiliated with the foreign producer or exporter.

Calculation of EP:

Gross Unit Price

- Movement Expenses

- Discounts and Rebates

= Export Price (EP)

Calculation of CEP:

Gross Unit Price

- Movement Expenses

- Discounts and Rebates

- Direct Selling Expenses

- Indirect Selling Expenses that relate to commercial activity

in the United States

- The cost of any further manufacture or assembly incurred in

the United States

- CEP Profit

= Constructed Export Price (CEP)

C. Fair Comparisons

To ensure that a fair comparison with normal value is made, the

Department will make adjustments to the price to the first

unaffiliated customer in calculating the EP or CEP. For both EP and

CEP the Department will add packing costs, if not already included

in the price, rebated import duties, and, if applicable, certain

countervailing duties. For both EP and CEP, the Department will

deduct transportation costs and export taxes or duties. In

calculating CEP, the Department will make additional deductions for

commissions, direct selling expenses incurred in selling the

merchandise under investigation in the United States, the cost of

any further manufacture or assembly performed in the United States,

and a portion of profit. In addition, the Department will deduct

indirect selling expenses that relate to commercial activity in the

United States.

Appendix C--Suspension of Antidumping Investigation--Fresh Tomatoes

From Mexico--Box Weights

The Department has the sole authority to make revisions to the

Box Weight Chart used to apply the reference price to particular box

configurations. The reference price for each type of box shall be

determined based on the average weights stated in the chart below.

The Department will coordinate with U.S. Customs and Border

Protection in its collection and review of data for calculating and

monitoring box-specific average weights. To derive representative

average weights for each box type in the chart below, the Department

will weigh twenty sample boxes, randomly chosen without notice, from

three different shippers (i.e., an average weight of sixty boxes for

each box type in the chart).

If the Department determines to revise an average weight figure

based upon information that an average weight on the chart is no

longer accurate, the Department will provide at least fifteen days

notice to signatories (either directly or through their

representative in this proceeding) prior to the effective date of

such revised average weights for purposes of this Agreement. The

Department will determine the revised average weight in accordance

with the procedure described above. Once the Department determines

the revised average weight, the weight will become effective at the

beginning of the next growing season

[[Page 4837]]

(which will be either July 1 or October 23 of a year).

In the event that a signatory intends to export subject

merchandise to the United States in a box for which there is no

average weight on the chart, the signatory shall notify the

Department in writing no later than forty-five days prior to the

date of the first exportation of such boxes to the United States.

Signatories can obtain from the Department's Web site a copy of the

suggested form for submitting this information. See ``Notification

of Intent to Ship Tomatoes in a Specialty Pack'' at http: //

ia.ita.doc.gov/tomato/2008-agreement/documents/suggested--forms/.

This information must be submitted to the Department in accordance

with the filing instructions set forth under 19 CFR 353.31 and

353.32. The Department shall allow any interested party to submit

written comments, not to exceed ten pages, on the appropriate

average weight for the box within seven days after the filing of the

written notification by the signatory, and the Department shall

inform the signatory or its representative of the average weight for

the box no later than thirty days after filing of the written

notification by the signatory.

Box-Weight Chart.--Suspension of Antidumping Investigation on Fresh Tomatoes From Mexico

--------------------------------------------------------------------------------------------------------------------------------------------------------

July 1- October 23-

Avg. Kg. Avg. Lb. October 22 June 30

Box type * Layers Size weight weight ** $0.172/lb $0.2169/lb

Reference Reference

-------------------------------------------------------------------------------------------------------------------------------price-----------price----

Tomato (cherry)...................... ........................ 12 Baskets............. 6.32 13.93 2.40 3.02

Tomato (cherry)...................... Bulk.................... Bulk................... 8.13 17.92 3.08 3.89

Tomato............................... 2L...................... 4 x 4.................. 10.78 23.77 4.09 5.16

Tomato............................... 2L...................... 4 x 5.................. 10.81 23.83 4.10 5.17

Tomato............................... 2L...................... 5 x 5.................. 10.43 22.99 3.96 4.99

Tomato............................... 2L...................... 5 x 6.................. 9.71 21.41 3.68 4.64

Tomato............................... 3L...................... 6 x 6.................. 13.33 29.39 5.05 6.37

Tomato............................... 3L...................... 6 x 7.................. 12.92 28.48 4.90 6.18

Tomato............................... Bulk.................... 25 lbs.***............. 12.15 26.79 4.61 5.81

Tomato............................... 1L...................... Long Box............... 7.41 16.34 2.81 3.54

Tomato (Green)....................... Bulk.................... Small--20 lb........... 8.16 17.99 3.09 3.90

Tomato Grape......................... Bulk.................... 20 lb.................. 9.42 20.77 3.57 4.51

Tomato Grape......................... Clam Shell.............. 12 Baskets--12 oz...... 4.71 10.38 1.79 2.25

Tomato Cluster....................... 1L...................... 11 lb. Flat............ 5.58 12.31 2.12 2.67

--------------------------------------------------------------------------------------------------------------------------------------------------------

* Applicable regardless of production method (e.g., field grown or greenhouse grown).

** Conversion factor from kg. to lb. based on 1 kg. = 2.20462 lbs.

*** Also applicable to 4/7 bushel cartons.

Appendix D--Suspension of Antidumping Investigation--Fresh Tomatoes

From Mexico--Procedures for Making Adjustments to the Sales Price Due

to Certain Changes in Condition After Shipment

The purpose of this appendix is to explain the procedures for

making adjustments to the sales price of signatory tomatoes due to

certain changes in condition after shipment, such that the sales

price for any tomatoes accepted in a lot \1\ do not fall below the

reference price. The procedures outlined in this appendix only apply

if the adjustment reduces the net sales price below the reference

price.

---------------------------------------------------------------------------

\1\ For these purposes, a lot is defined as a grouping of

tomatoes in a particular shipment that is distinguishable by packing

type.

---------------------------------------------------------------------------

As explained in Appendix A of the Agreement, the term

``reference price'' refers to the price F.O.B. from the Selling

Agent. The reference price includes all palletizing and cooling

charges incurred prior to shipment from the Selling Agent. The

actual movement or handling expenses beyond the point of entry into

the United States (e.g., McAllen, Nogales, Otay Mesa) must be added

to the reference price and must reflect the cost for an arm's-length

transaction. The chart below contains examples of certain minimum

common trucking charges the USDA observed during the 2007 winter

season.

----------------------------------------------------------------------------------------------------------------

F.O.B. Nogales to: Los Angeles New York Chicago

----------------------------------------------------------------------------------------------------------------

Rate ($US)/Per Truckload........................................ $900 $5,000 $3,200

----------------------------------------------------------------------------------------------------------------

Parties should refer to http://www.ams.usda.gov/fv/mncs/

fvwires.htm to obtain examples of common trucking charges pertinent

to the current season. Where the Selling Agent sells through an

affiliated party, the transfer price from the Selling Agent to the

affiliate must be at or above the reference price and any subsequent

sale to an unaffiliated party must include the actual cost of

markups (e.g., trucking charges) that reflect arm's-length costs.

For guidance on the trucking-charge markup for such resales, parties

should also refer to http://www.ams.usda.gov/fv/mncs/fvwires.htm to

obtain common trucking charges pertinent to the current season.

Appendix G of the Agreement outlines specific actions that

signatories should take to ensure that their efforts to abide by the

Agreement are upheld in any claims taken to the U.S. Department of

Agriculture under the Perishable Agricultural Commodities Act.

To facilitate the verification of claims for changes in

condition after shipment, the contract between the signatory and the

Selling Agent must establish that claims be resolved and all paper

work be completed within fifteen business days after the USDA

inspection unless the claim is referred to PACA for mediation. When

filing quarterly certifications with the Department, signatories

should report the number of lots on which claims for condition

defects were granted, the total volume of tomatoes destroyed or

donated, and the total value of claims granted. Signatories can

obtain from the Department's Web site a copy of the suggested form

for submitting the quarterly certification information. See

``Quarterly Certification'' at http://ia.ita.doc.gov/tomato/2008-

agreement/documents/suggested--forms/.

A. Contractual Terms for Rejecting All or Part of a Lot

1. A USDA inspection certificate must be provided to support

claims for rejection of all or part of a lot. Further, no

adjustments will

[[Page 4838]]

be made for failure to meet suitable shipping conditions unless

supported by an unrestricted USDA inspection.

2. If the USDA inspection indicates that the lot has: (1) Over

8% soft/decay condition defects; (2) over 15% of any one condition

defect; or (3) greater than 20% total condition defects, the

receiver may reject the lot or may accept a portion of the lot and

reject the quantity of tomatoes lost during the salvaging process.

In those instances, price adjustments will be calculated as

described below. For purposes of this Agreement, a condition defect

is any defect listed in the chart in part A.5. below. When a lot of

tomatoes has condition defects in excess of those outlined above as

documented on a USDA inspection certificate, the documented

percentage of the tomatoes with condition defects are considered

DEFECTIVE tomatoes.

3. No adjustments will be made for failure to meet suitable

shipping conditions if the USDA inspection certificate does not

indicate one of the condition thresholds outlined above.

4. The USDA inspection must be called for no more than six hours

from the time of arrival at the destination specified by the

receiver and be performed in a timely fashion thereafter. If there

is more than one USDA inspection on a given lot, the inspection

certificate corresponding to the first inspection is the one that

will be used for making any adjustment to the sales price. However,

if an appeal inspection is conducted, it will supercede the first

inspection, as long as the appeal inspection is requested within a

reasonable amount of time from the first inspection.

The first receiver of the product, regardless of whether that

receiver is acting as an agent or a broker for an unrelated

purchaser or whether the receiver is the unrelated purchaser acting

on its own right, must specify the city/metropolitan area of the

destination of the product. The inspection will take place at the

destination of delivery as specified prior to shipment.

No adjustments will be granted for a USDA inspection at a

destination which is different from the destination specified by the

first receiver of the product. In the event that the first receiver

does not specify the city/metropolitan area of the destination of

the product, the six-hour period within which an inspection may be

requested will begin to run at such time as title to the product

transfers to the unrelated purchaser, for example, upon loading of

the product at the first handler's (importer's) warehouse in an

F.O.B. transaction and upon delivery of the product to the first

buyer's warehouse in a delivered sale.

A person or company shall be considered an agent or broker for

an unrelated purchaser: (1) When that person or company falls within

the description of types of broker operations set forth in 7 CFR

46.27; or (2) have provided a broker's memorandum of sale as set

forth in 7 CFR 46.28(a). The following paragraphs apply if a broker

or dealer is involved in the transaction.

A broker, unlike a dealer, does not take ownership or control of

the tomatoes but arranges for delivery directly to the vendor or

purchaser. Because a broker never takes ownership or control over

the tomatoes, the customer and not the broker may request an

inspection, and only the customer is entitled to any resulting

adjustments. The inspection would take place at the customer's

destination, as specified in the broker's contract with the Selling

Agent.

When a dealer is involved in the sale, the destination of

delivery stated in the contract is where the inspection is to take

place. If the dealer does not specify the destination of delivery,

the default destination of delivery is the warehouse of the Selling

Agent. With respect to a lot of tomatoes that is owned or controlled

by a dealer, it is the responsibility of the dealer to request an

inspection of the tomatoes in his possession in a timely manner, if

he deems it necessary. If the dealer does not request an inspection

in a timely manner (i.e., within six hours from the time of arrival

at the destination specified by the dealer) and resells the tomatoes

to a third party, which does request an inspection, the dealer is

then responsible for all costs and adjustments pertaining to the

inspection and the condition or quality of the tomatoes.

5. Under this Agreement, adjustments to the sales price of

signatory tomatoes will be permitted only for condition defects. The

term ``condition defect'' is intended to have the same definition

recognized by the Fresh Produce Branch of the United States

Department of Agriculture, with the exception of abnormal coloring,

and, therefore, covers the following items:

Condition Defects

(1) Sunken & Discolored Areas

(2) Sunburn

(3) Internal Discoloration

(4) Freezing Injury

(5) Chilling Injury

(6) Gray Mold Rot

(7) Bacterial Soft Rot

(8) Soft/Decay**

(9) Bruising

(10) Nailhead Spot

(11) Skin Checks

(12) Decayed and Moldy Stems

(13) Waxy Blister

(14) White Core

(15) Discolored or Dried-out Jelly Around Seeds

------------------------------------------------------------------------

** The most common decays listed by the USDA are pleospora rot, phoma

rot, alternaria rot, and blossom end rot.

6. In calculating the transaction price for lots subject to an

adjustment claim for condition defects, as defined above, the

tomatoes classified as DEFECTIVE will be treated as rejected and as

not having been sold.

B. Contractual Terms for Rejection of Partial Loads

If the lot contains condition defects greater than those

outlined above and the receiver does not reject the entire lot of

tomatoes, the Department will factor certain adjustments into the

transaction price, provided that the following conditions apply:

1. The price invoiced to and paid by the receiver for the

accepted tomatoes must not fall below the reference price.

2. The Selling Agent may reimburse the receiver for actual

destruction costs associated with the DEFECTIVE tomatoes. If

properly documented, these expenses will not be considered in the

calculation of the price of the accepted tomatoes.

3. The Selling Agent may reimburse the receiver for the portion

of freight expenses allocated to the DEFECTIVE tomatoes. If properly

documented, these expenses will not be considered in the calculation

of the price of the accepted tomatoes.

4. If the Selling Agent follows the guidelines outlined below,

it may reimburse the receiver for repacking charges directly

associated with salvaging and reconditioning the lot. If properly

documented, these expenses will not be considered in the calculation

of the price of the accepted tomatoes.

a. If the salvaging and reconditioning activity is performed by

a party unaffiliated with the Selling Agent's customer the fee

charged for the service may be reimbursed if the Selling Agent's

customer can provide evidence for such costs (i.e., specifically,

proof-of-payment documentation for the invoice from the repacker).

b. If the salvaging and reconditioning activity is performed by

the Selling Agent's customer or a party affiliated with the Selling

Agent, the direct labor costs or, in lieu thereof, one-half of the

ordinary and customary repacking charges may be reimbursed. To

substantiate such costs the Selling Agent's customer or party

affiliated with the Selling Agent must provide detailed records of

the labor cost incurred for repacking or, where applicable, evidence

of the ordinary and customary repacking costs.

5. The Selling Agent may reimburse the receiver for the

inspection fees listed on the USDA inspection certificate. If

properly documented, these expenses will not be considered in the

calculation of the price of the accepted tomatoes.

6. Any reimbursements from, by, or on behalf of the Selling

Agent that are not specifically mentioned in items B.2., B.3., B.4.,

or B.5. above, or that are not properly documented, will be factored

into the calculation of the price for the accepted tomatoes.

7. The receiver may not resell the DEFECTIVE tomatoes. The

receiver may choose to have the DEFECTIVE tomatoes destroyed,

donated to non-profit food banks, or returned to the Selling Agent.

The DEFECTIVE tomatoes may not be sold.\2\

---------------------------------------------------------------------------

\2\ Tomatoes for processing must be handled in accordance with

the guidelines set forth in Appendix F of the Agreement.

---------------------------------------------------------------------------

8. In addition, for each transaction involving adjustments due

to changes in condition after shipment the Selling Agent must

obtain/maintain the following documents/information:

--Shipper name.

--Shipping manifest.

--Details of the shipper invoice, including invoice number, date,

brand, tomato type, quantity (boxes), and value.

--Documentation supporting the freight expenses incurred for the

original shipment.

--USDA inspection certificate.

--Detailed listing of the expenses incurred in salvaging the non-

DEFECTIVE tomatoes

[[Page 4839]]

and documentation supporting the expenses.

--Description of the destruction or donation process and

documentation from the landfill or food bank.

--Proof-of-payment documentation for any destruction costs.

--A statement that ``No monies or other compensation was received

for the destroyed or donated tomatoes.''

--Signature of a responsible official at the receiver.

C. Contractual Terms for Rejection of Full Loads

In cases where the receiver has rejected the full lot of

tomatoes based on condition defects, the Selling Agent may choose to

have the entire lot destroyed, donated to non-profit food banks, or

returned. If the entire lot is destroyed or donated, the Selling

Agent will require the receiver to provide the documentation noted

above for partial-lot rejections. Further, the Selling Agent may

reimburse the receiver for ordinary and customary expenses that the

receiver incurred with respect to the lot, including those expenses

associated with the destruction or donation process, as long as the

Selling Agent obtains the support documentation specified above

under B.8. The Department will treat such transactions as ``non-

sales'' provided that adequate support documentation is available.

Alternatively, the Selling Agent may sell the entire rejected

lot to another receiver. In that case, the price paid must be not

less than the reference price plus all costs incurred (e.g.,

transportation, commissions, etc.) from the F.O.B. port of entry to

the final receiver. If the final receiver finds that the lot

contains condition defects greater than those outlined above, it

shall follow the directions stated above with respect to rejection

of partial loads.

D. Contractual Terms for Partial vs. Unrestricted Lot Inspections

As explained in part A.1. above, the Department will only allow

adjustments to the transaction price for condition defects if the

USDA inspection is unrestricted. During the time between the call

for inspection and the arrival of the USDA inspector, the receiver

might sell part of the lot and, therefore, by the time the USDA

inspector arrives, that part is not available for inspection. If the

USDA inspector is allowed full access to the partial lot, the

Department will consider this an unrestricted partial-lot

inspection. Alternatively, if the USDA inspector is not allowed full

access to the partial lot, the Department will deem it a restricted

inspection. No adjustments will be made for failure to meet suitable

shipping conditions if the USDA inspection is restricted. For

purposes of this Agreement, when calculating an adjustment for

failure to meet suitable shipping conditions where an unrestricted

partial-lot inspection has taken place, only the portion of the lot

inspected is eligible for adjustment. The portion of the lot that

the receiver sold prior to the inspection will not be eligible for

an adjustment based on the USDA inspection.

For example, before the USDA inspector arrives, the receiver

sells 140 boxes of 5x5s from a lot identified as 160 5x5s on the

invoice. When the USDA inspector arrives the receiver requesting the

inspection provides full access to the partial lot within its

possession. The inspector finds that the partial lot of 20 5x5s has

soft/decay condition defects of 25 percent and notes this on this

inspection certificate. Under the Agreement, only the 20 5x5s are

eligible for an adjustment for failure to meet suitable shipping

conditions, and the 140 5x5s that the receiver already sold will not

be eligible for an adjustment based on the USDA inspection.

Appendix E--Suspension of Antidumping Investigation--Fresh Tomatoes

From Mexico--Contractual Arrangement for Documenting Sales of Signatory

Merchandise to Canada

Based on our experience in this proceeding, it is common

practice for the signatory's Selling Agent to enter the merchandise

into the United States for consumption and then re-export it to

Canada. The purpose of this appendix is to: (1) Outline the process

that each signatory of this Agreement must follow to ensure that the

Selling Agent properly documents sales to Canada as such and (2)

ensure that the signatory notifies the Canadian customer that any

resales of its merchandise from Canada into the United States must

be in accordance with the terms of this Agreement.

To document sales of Mexican tomatoes to Canada properly, this

Agreement requires that such transactions be made pursuant to a

contractual arrangement where each signatory requires that the

Selling Agent that facilitates the sale to Canada maintain the

following information in its files:

1. Signatory name and identification number;

2. Shipping manifest;

3. An invoice identifying sale date, brand, tomato type,

quantity (boxes), and value; and

4. Entry documentation from Canadian Customs (i.e., Landing Form

(Form B3) or the Canada Customs Coding Form).

If a signatory to the Agreement or its Selling Agent does not

document a sale to Canada in accordance with the procedures outlined

above, the Department will consider the transaction a U.S. sale.

We also require signatories to ensure that the Canadian customer

is notified that any resale of the signatory merchandise from Canada

into the United States must be in accordance with the terms of the

Agreement and that any movement or handling expenses beyond the

point of export from Mexico must be added to the reference price and

must reflect the actual cost for an arm's-length transaction.

Signatories can obtain from the Department's Web site a copy of the

suggested form for providing such notification. See ``Form for

Notifying Canadian Customer That Resales of Signatory Merchandise

Into the United States Are Covered by the Terms of the 2008

Suspension Agreement'' at http://ia.ita.doc.gov/tomato/2008-

agreement/documents/suggested--forms/. Further, through contractual

arrangement each signatory must require that the Selling Agent

maintain evidence in its files to document that the Canadian

customer was notified that any resales of the signatory merchandise

from Canada into the United States must be in accordance with the

terms of the Agreement.

Appendix F--Suspension of Antidumping Investigation--Fresh Tomatoes

From Mexico--Procedure Signatories Must Follow for Selling Subject

Merchandise for Processing

Sales to the United States of signatory tomatoes for processing

must be:

1. Sold directly to a processor (in other words, the first

purchaser in the United States of tomatoes for processing must be an

actual processor);

2. Accompanied by an ``Importer's Exempt Commodity Form''--Form

FV-6, within the meaning of 7 CFR section 980.501(a)(2) and

980.212(I), should be used for all tomatoes for processing that are

covered by the Florida Marketing Order; tomatoes for processing that

are not covered by the Florida Marketing Order (e.g., romas, grape

tomatoes, greenhouse tomatoes and any tomatoes that are entered

during the part of the year that the Florida Marketing Order is not

in effect) must be accompanied by the ``2008 Suspension Agreement--

Tomatoes for Processing Exemption Form''. The exempt commodity form

must be presented to U.S. Customs and Border Patrol at the time of

crossing at the port of entry into the United States and both the

Selling Agent and the processor must maintain a copy of the form.

3. Shipped in a packing form that is not typical of tomatoes for

the fresh market (e.g., bulk containers in excess of 50 lbs)--

examples of typical fresh-market packing forms are identified in the

Box-Weight Chart in Appendix C of the Agreement; and

4. Clearly labeled on the packaging as ``Tomatoes for

Processing''.

Signatories can obtain from the Department's Web site an example

of the ``2008 Suspension Agreement--Tomatoes for Processing

Exemption Form''. See http://ia.ita.doc.gov/tomato/2008-agreement/

documents/suggested--forms/. If a party in the United States

facilitates the transaction, through contractual arrangement each

signatory must require that the party follow the procedures outlined

above.

Appendix G--Suspension of Antidumping Investigation--Fresh Tomatoes

From Mexico--Specific Actions That Signatories Should Take To Ensure

That Their Efforts To Abide by the Agreement Are Upheld in any Claims

Taken to the U.S. Department of Agriculture Under the Perishable

Agricultural Commodities Act

This appendix provides guidance on the specific actions

signatories can take to ensure that their efforts to abide by the

Agreement are upheld in any claims taken to the Department of

Agriculture under the Perishable Agricultural Commodities Act

(PACA).

The former Chief of the Department of Agriculture's PACA branch,

James R. Frazier, has confirmed that this Agreement is

[[Page 4840]]

enforceable under PACA regulations and PACA's claim settlement

process. According to Mr. Frazier, in settling a claim, PACA will

uphold actions taken by a signatory or a signatory's representative

(collectively ``signatory'') to comply with the Agreement to the

extent that the sales contract for the transaction at issue

establishes that the sale is subject to the terms of the Agreement.

In other words, if, prior to making the sale, the signatory, or the

Selling Agent acting on behalf of the signatory through a

contractual arrangement, informs the customer that the sale is

subject to the terms of the Agreement and identifies those terms,

PACA will recognize the identified terms of the Agreement as

integral to the sales contract. In particular, signatories should

inform their customers that their contractual agreement to allow

defect claim adjustments is limited in accordance with the

Agreement, including:

Claims for adjustments must be supported by an

unrestricted USDA inspection called for no more than six hours from

the time of arrival at the receiver and performed in a timely

fashion thereafter.

The USDA inspection must find that the condition

defects exceed the thresholds outlined in Appendix D above.

Any price adjustments will be limited to the actual

percentage of condition defects as documented by a USDA inspection

certificate.

The price adjustments will be limited to actual

destruction costs, the allocated freight expense, and salvaging and

reconditioning expenses calculated in accordance with Appendix D

above.

The customer may not resell any defective tomatoes.

Instead, they must be destroyed, returned or donated to a non-profit

food bank. Signatories should provide a copy of the Agreement to any

customer which may be unfamiliar with its terms or which has

questions about those terms.

The process by which a signatory could provide evidence to PACA

that its sales contracts were made subject to the terms of the

Agreement including, in particular, those terms listed above is

outlined below.

The signatory should maintain written documentation

demonstrating that it had informed its customers and the customers

accepted that the sales were subject to the terms of the Agreement

prior to issuing the invoice. A signed contract to that effect would

be the best evidence of that fact; however, a purchase by the

customer after being informed of the relevance of the Agreement is

evidence of acceptance.

The signatory should send letters to its customers via

registered mail, return receipt requested, informing the customers

that, as a signatory to the Agreement, all of the signatory's sales

are subject to the terms of the Agreement and that, by purchasing

from them, the buyer agrees to those terms. The letter should also

indicate that the signatory's sales personnel do not have authority

to alter the terms of the Agreement.

In addition, the signatory should include a statement

on its order confirmation sheets that its contract with the buyer is

subject to the terms of the Agreement as detailed in the signatory's

``pre-season'' letter and maintain a copy of the order confirmations

and fax receipts demonstrating that they were sent to the customer

prior to making the sale. If the sale is to a first-time purchaser

that did not receive a ``pre-season'' letter, a letter should be

supplied to the buyer prior to making a sale.

The signatory should instruct its sales personnel to

inform customers making purchases by telephone or at the loading

dock that the sale is subject to the terms of the Agreement and its

restrictions on price adjustments and, by purchasing from them, the

buyer agrees to those terms. In fact, the sales personnel should

provide a copy of the letter to the customer and, ideally, have the

customer acknowledge receipt of the letter, in writing, prior to

making the sale. Such an established practice will help to ensure

that even new customers are informed properly of the terms of sale

prior to completing a contract.

PACA does not require any one particular form of written

documentation but USDA officials have confirmed that, if signatories

maintain written evidence demonstrating that their customers were

informed that their sales were made subject to the terms of the

Agreement prior to sale, PACA will recognize those terms as part of

the sales contract.

[FR Doc. E8-1442 Filed 1-25-08; 8:45 am]

BILLING CODE 3510-DS-P


TANC offers these agreements electronically as a public service for general reference. Every effort has been made to ensure that the text presented is complete and accurate. However, copies needed for legal purposes should be obtained from official archives maintained by the appropriate agency.