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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 $0.2169 per pound.
These reference prices will remain in effect unless modified in
accordance with the provisions of paragraph IV.G. of the Agreement.
The term ``reference price'' refers to the price F.O.B. from the
Selling Agent. The reference price includes all palletizing and
cooling charges incurred prior to shipment from the Selling Agent.
The actual movement or handling expenses beyond the point of entry
into the United States (e.g., McAllen, Nogales, Otay Mesa) must be
added to the reference price and must reflect the cost for an arm's-
length transaction. The chart below contains examples of certain
minimum common trucking charges the USDA observed during the 2007
winter season.
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F.O.B. Nogales to: Los Angeles New York Chicago
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Rate ($US)/Per Truckload........................................ $900 $5,000 $3,200
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Parties should refer to https://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 https://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 https://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 https://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 https://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 https://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 https://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.
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