81 FR 87539 - Suspension Agreement on Sugar From Mexico; Administrative Review of the Agreement Suspending the Countervailing Duty Investigation on Sugar From Mexico

DEPARTMENT OF COMMERCE
International Trade Administration

Federal Register Volume 81, Issue 233 (December 5, 2016)

The Department of Commerce (the Department) is conducting an administrative review of the Agreement Suspending the Countervailing Duty Investigation of Sugar from Mexico (the CVD Agreement) for the period December 19, 2014, through December 31, 2015 (CVD review). Based upon the current record of this review, there is some indication that certain individual transactions of subject merchandise may not be in compliance with the CVD Agreement, and further, that the CVD Agreement may no longer be meeting all of the statutory requirements, as set forth in sections 704(c) and (d) of the Tariff Act of 1930, as amended (the Act). The Department, therefore, needs to obtain additional information in order to confirm whether the Government of Mexico (GOM)--the signatory to the CVD Agreement--is in compliance with the terms of the CVD Agreement, and whether the current CVD Agreement continues to meet the relevant statutory requirements referenced above. The preliminary results are set forth in the section titled ``Methodology and Preliminary Results,'' infra. Absent the issuance of a revised suspension agreement, we intend to issue a post-preliminary finding on these issues as soon as practicable. In addition, we expect to issue the final results of review within 120 days after publication of these preliminary results in the Federal Register.

[Federal Register Volume 81, Number 233 (Monday, December 5, 2016)]
[Notices]
[Pages 87539-87541]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-29075]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-201-846]


Suspension Agreement on Sugar From Mexico; Administrative Review 
of the Agreement Suspending the Countervailing Duty Investigation on 
Sugar From Mexico

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

DATES: Effective December 5, 2016.
SUMMARY: The Department of Commerce (the Department) is conducting an 
administrative review of the Agreement Suspending the Countervailing 
Duty Investigation of Sugar from Mexico (the CVD Agreement) for the 
period December 19, 2014, through December 31, 2015 (CVD review). Based 
upon the current record of this review, there is some indication that 
certain individual

[[Page 87540]]

transactions of subject merchandise may not be in compliance with the 
CVD Agreement, and further, that the CVD Agreement may no longer be 
meeting all of the statutory requirements, as set forth in sections 
704(c) and (d) of the Tariff Act of 1930, as amended (the Act). The 
Department, therefore, needs to obtain additional information in order 
to confirm whether the Government of Mexico (GOM)--the signatory to the 
CVD Agreement--is in compliance with the terms of the CVD Agreement, 
and whether the current CVD Agreement continues to meet the relevant 
statutory requirements referenced above. The preliminary results are 
set forth in the section titled ``Methodology and Preliminary 
Results,'' infra. Absent the issuance of a revised suspension 
agreement, we intend to issue a post-preliminary finding on these 
issues as soon as practicable. In addition, we expect to issue the 
final results of review within 120 days after publication of these 
preliminary results in the Federal Register.

FOR FURTHER INFORMATION CONTACT: Sally C. Gannon or David Cordell, 
Enforcement & Compliance, International Trade Administration, U.S. 
Department of Commerce, 14th Street and Constitution Avenue NW., 
Washington, DC 20230, telephone: (202) 482-0162 or (202) 482-0408.

SUPPLEMENTAL INFORMATION: 

Scope of Review

    Merchandise covered by this CVD Agreement is typically imported 
under the following headings of the HTSUS: 1701.12.1000, 1701.12.5000, 
1701.13.1000, 1701.13.5000, 1701.14.1000, 1701.14.5000, 1701.91.1000, 
1701.91.3000, 1701.99.1010, 1701.99.1025, 1701.99.1050, 1701.99.5010, 
1701.99.5025, 1701.99.5050, and 1702.90.4000. The tariff classification 
is provided for convenience and customs purposes; however, the written 
description of the scope of this CVD Agreement is dispositive.\1\
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    \1\ For a complete description of the Scope of the Order, see 
Memorandum to Paul Piquado, Assistant Secretary for Enforcement and 
Compliance, from Carole Showers, Director, Office of Policy, 
``Decision Memorandum for Preliminary Results of Administrative 
Review of the Agreement Suspending the Antidumping Duty 
Investigation on Sugar from Mexico,'' dated concurrently with and 
adopted by this notice (``Preliminary Decision Memorandum'').
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Methodology and Preliminary Results

    On December 19, 2014, the Department signed an agreement under 
section 704(c) of the Act, with the GOM, suspending the countervailing 
duty investigation on sugar from Mexico.\2\ On January 8, 2015, 
Imperial Sugar Company (Imperial) and AmCane Sugar LLC (AmCane) each 
notified the Department that they had petitioned the U.S. International 
Trade Commission (the ITC) to conduct a review to determine whether the 
injurious effects of imports of the subject merchandise are eliminated 
completely by the CVD Agreement (a section 704(h) review).\3\ On 
January 16, 2015, Imperial and AmCane also submitted timely requests 
for continuation of the CVD investigation.\4\ On March 19, 2015, in a 
unanimous vote, the ITC found that the CVD Agreement eliminates 
completely the injurious effects of imports of sugar from Mexico.\5\ 
Subsequently, on April 24, 2015, the Department determined that AmCane 
and Imperial had standing to request continuation of this investigation 
and, as a result, published a continuation notice on May 4, 2015.\6\ On 
September 23, 2015, the Department issued a final affirmative 
determination in the CVD investigation.\7\ On November 16, 2015, the 
ITC published its final affirmative finding that an industry in the 
United States is materially injured by reason of imports of sugar from 
Mexico found to be subsidized by the GOM.\8\ Because the ITC determined 
that such injury did exist, consistent with section 704(f)(3)(B) of the 
Act, the CVD Agreement remained in force.\9\
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    \2\ See Agreement Suspending the Countervailing Duty 
Investigation on Sugar from Mexico, 79 FR 78044 (December 29, 2014), 
at Attachment, ``Agreement Suspending the Countervailing Duty 
Investigation on Sugar from Mexico'' (the CVD Agreement).
    \3\ See Letter from Imperial, ``Sugar from Mexico--Notice of 
Filing of Petition for Review of Suspension Agreements to Eliminate 
the Injurious Effect of Subject Imports,'' January 8, 2015; see also 
Letter from AmCane, ``Sugar from Mexico: Notice of Petition for 
Review of Suspension Agreements,'' January 8, 2015.
    \4\ See Letter from Imperial, ``Sugar from Mexico, Inv. Nos. A-
201-845 and C-201-846--Request for Continuation of Investigations,'' 
January 16, 2015; see also Letter from AmCane, ``Sugar from Mexico: 
Request for Continuation of Investigations,'' January 16, 2015.
    \5\ See Department Memorandum, ``Requests to Continue the 
Antidumping and Countervailing Duty Investigations on Sugar from 
Mexico,'' March 19, 2015.
    \6\ See id.
    \7\ See Sugar from Mexico: Final Affirmative Countervailing Duty 
Determination, 80 FR 57337 (September 23, 2015).
    \8\ See Sugar from Mexico (Investigation Nos. 701-TA-513 and 
731-TA-1249 (Final)), 80 FR 70833 (November 16, 2015).
    \9\ See Final CVD Determination, 80 FR at 57339. Pursuant to 
section 704(f)(3)(B) of the Act, the CVD Agreement remains in force 
and the Department shall not issue an countervailing order so long 
as (i) the CVD Suspension Agreement remains in force, (ii) the CVD 
Suspension Agreement continues to meet the requirements of 
subsections 704(c) and 704(d) of the Act, and (iii) the parties to 
the CVD Suspension Agreement carry out their obligations under the 
CVD Suspension Agreement in accordance with its terms.
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    On December 30, 2015, Imperial and AmCane submitted requests for an 
administrative review of the CVD Agreement.\10\ On December 31, 2015, 
the American Sugar Coalition and its Members \11\ (Petitioners) filed a 
request for an administrative review of the CVD Agreement.\12\
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    \10\ See Letter from Imperial, ``Sugar from Mexico, Inv. No. C-
201-846--Request for Administrative Review of the Agreement 
Suspending the Countervailing Duty Investigation,'' December 30, 
2015; Letter from AmCane, ``Sugar from Mexico: Request for 
Administrative Reviews,'' December 30, 2015.
    \11\ The members of the American Sugar Coalition are as follows: 
American Sugar Cane League, American Sugarbeet Growers Association, 
American Sugar Refining, Inc., Florida Sugar Cane League, Hawaiian 
Commercial and Sugar Company, Rio Grande Valley Sugar Growers, Inc., 
Sugar Cane Growers Cooperative of Florida, and the United States 
Beet Sugar Association.
    \12\ See Letter from American Sugar Coalition and its Members, 
``Sugar from Mexico: Request for Administrative Review,'' December 
31, 2015.
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    The review of the CVD Agreement was initiated on February 9, 
2015,\13\ for the December 19, 2014 through December 31, 2014, period 
of review (POR) but was extended on March 16, 2016, to include calendar 
year 2015.\14\ On June 2, 2016, the Department selected mandatory 
respondents \15\ and issued its questionnaire to the GOM, the signatory 
to the CVD Agreement, and asked the GOM to send full questionnaires 
(Attachment 2) to two companies (and their respective affiliates): 
Central Motzorongo S.A. de C.V. (Motzorongo) and Fideicomiso Ingenio 
San Cristobal (San Cristobal). The Department also asked that the GOM 
forward a more limited questionnaire (Attachment 1) to all Mexican 
producers and exporters of sugar to whom the GOM issued an export 
license in the POR.\16\
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    \13\ See Initiation of Antidumping and Countervailing Duty 
Administrative Reviews, 81 FR 6832 (February 9, 2016).
    \14\ On March 16, 2016, the Department expanded the period of 
review for the CVD Agreement from December 19, 2014, through 
December 31, 2014, to include calendar year 2015. As such, the 
period of review for the instant review is December 19, 2014, 
through December 31, 2015. See Memorandum to Lynn Fischer Fox 
entitled ``First Administrative Review of the Agreement Suspending 
the Countervailing Duty Investigation on Sugar from Mexico: 
Extending the Period of Review'' (March 16, 2016).
    \15\ See Department Memorandum, ``First Administrative Review of 
the Agreement Suspending the Countervailing Duty Investigation on 
Sugar from Mexico: Questionnaire Issuance,'' June 2, 2016.
    \16\ See Questionnaire Regarding the Agreement Suspending the 
Countervailing Duty Investigation on Sugar from Mexico for the 
December 19, 2014 through December 31, 2015 Period of Review, dated 
June 2, 2016.

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[[Page 87541]]

    The Department has conducted this review in accordance with section 
751(a)(1)(C) of the Act, which specifies that the Department shall 
``review the current status of, and compliance with, any agreement by 
reason of which an investigation was suspended.'' Pursuant to the CVD 
Agreement, the GOM agreed that the subject merchandise would be subject 
to export limits as outlined in the CVD Agreement.\17\ The Government 
also agreed to other conditions including limits on Refined Sugar \18\ 
and the issuance of shipment-specific export licenses.\19\ In addition, 
in this review, the Department is reassessing whether suspension of the 
CVD Agreement is in the ``public interest,'' including the availability 
of supplies of sugar in the U.S. market, and whether ``effective 
monitoring'' is practicable.\20\
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    \17\ See Agreement, 79 FR 78040, 78047 at Export Limits.
    \18\ See id., 79 FR 78046-78047 at Definitions and Export 
Limits.
    \19\ See id., 79 FR 78048 at Export Limits and Implementation.
    \20\ See Memorandum to Paul Piquado entitled ``Agreement 
Suspending the Countervailing Duty Investigation on Sugar from 
Mexico: Existence of Extraordinary Circumstances, Public Interest, 
and Effective Monitoring Assessments) (December 19, 2014) at pages 
3-5.
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    After reviewing the information received to date from the 
respondent companies in their questionnaire responses, there is some 
indication that certain individual transactions of subject merchandise 
may not be in compliance with the CVD Agreement and that the CVD 
Agreement may no longer be meeting all of the statutory requirements, 
as set forth in sections 704(c) and (d) of the Tariff Act of 1930 (the 
Act). However, based on the Department's review to date of the record 
information, we do not yet find a sufficient basis to make a reliable 
judgment as to whether the GOM and the Mexican respondent mills have 
adhered to the terms of the CVD Agreement and whether the CVD Agreement 
continues to meet the relevant requirements of the Act for such 
agreements. As detailed above, the Department found it necessary, late 
in the review, to seek additional information, i.e., in supplemental 
questionnaires issued to the GOM and to its two selected mill 
respondents on November 18, 2016, in order to reach a determination as 
to whether the Agreement is functioning as intended, is in the public 
interest and whether it can be effectively monitored. For a full 
description of the methodology underlying our conclusions, see 
Preliminary Decision Memorandum, dated concurrently with these results 
and hereby adopted by this notice. The Preliminary Decision Memorandum 
is a public document and is made available via Enforcement & 
Compliance's Antidumping and Countervailing Duty Centralized Electronic 
Service System (ACCESS). ACCESS is available to registered users at 
https://access.trade.gov and in the Department's Central Records Unit, 
located in Room 18022 of the main Department of Commerce building. In 
addition, a complete version of the Preliminary Decision Memorandum can 
be found on the Internet at http://www.trade.gov/enforcement. The 
signed Preliminary Decision Memorandum and the electronic version of 
the Preliminary Decision Memorandum are identical in content.

Public Comment

    As discussed above, the Department needs additional information 
before making a definitive preliminary finding. Therefore, absent the 
issuance of a revised suspension agreement, we intend to issue our 
post-preliminary finding on these issues as soon as practicable. The 
comment period on these preliminary results as well as the post-
preliminary results will be stated with the release of the post-
preliminary results. At that time interested parties will have the 
opportunity to submit case and rebuttal briefs.
    Pursuant to 19 CFR 351.310(c), interested parties who wish to 
request a hearing, or to participate if one is requested, must submit a 
written request to the Assistant Secretary for Enforcement and 
Compliance, filed electronically via ACCESS. An electronically filed 
document must be received successfully in its entirety by the 
Department's electronic records system, ACCESS, by 5 p.m. Eastern Time 
within 30 days after the date of the issuance of the post-preliminary 
results. Requests should contain: (1) The party's name, address and 
telephone number; (2) the number of participants; and (3) a list of 
issues to be discussed. Issues raised in the hearing will be limited to 
those raised in the respective case briefs. The Department intends to 
issue the final results of this administrative review, including the 
results of its analysis of the issues raised in any written briefs, not 
later than 120 days after the date of publication of this notice, 
pursuant to section 751(a)(3)(A) of the Act.
    We are issuing and publishing these results in accordance with 
sections 751(a)(1) and 777(i)(1) of the Act.

    Dated: November 29, 2016.
Paul Piquado,
Assistant Secretary for Enforcement and Compliance.
[FR Doc. 2016-29075 Filed 12-2-16; 8:45 am]
BILLING CODE 3510-DS-P