NOTICES

                               [C-301-601]

     Miniature Carnations From Colombia; Final Results of Countervailing Duty
                           Administrative Review

                           Monday, April 8, 1991

 AGENCY: International Trade Administration/Import Administration, Department
 of Commerce.

 ACTION: Notice of final results of countervailing duty administrative review.

 SUMMARY: On December 6, 1990, the Department of Commerce published a notice of
 preliminary results of countervailing duty administrative review on miniature
 carnations from Colombia. We have now completed that review and determine that the
 signatories to the suspension agreement have complied with the terms of the suspension
 agreement during the period January 1, 1989 through December 31, 1989.

 EFFECTIVE DATE: April 8, 1991.

 FOR FURTHER INFORMATION CONTACT:Robert Bolling or Barbara Williams, Office of
 Agreements Compliance, International Trade Administration, U.S. Department of
 Commerce, Washington, DC 20230; telephone: (202) 377-3793.

 SUPPLEMENTARY INFORMATION:

 Background

 On December 6, 1990, the Department of Commerce ("the Department") published in the
 Federal Register (55 FR 50345) the preliminary results of its administrative review of the
 agreement suspending the countervailing duty investigation on miniature carnations
 from Colombia (52 FR 1353; January 13, 1987). We have now completed that
 administrative review in accordance with section 751 of the Tariff Act of 1930 ("the Tariff
 Act").

 Scope of Review

 Imports covered by this review are shipments of miniature carnations from Colombia.
 During the period of review, such merchandise as classifiable under item 063.10.30 of the
 Harmonized Tariff Schedule ("HTS"). The HTS item numbers are provided for convenience
 and Customs purposes. The written description remains dispositive.
 The review covers the period January 1, 1989 through December 31, 1989 and ten
 programs: (1) Tax Rebate Certificate ("CERT"); (2) Working Capital
 Resolutions--Resolutions 59, 11 and 14; (3) Fixed Capital Resolution-- Resolution 40; (4)
 Duty and Tax Exemptions under Plan Vallejo; (5) Resolution 10; (6) Fund for Agricultural
 Financing; (7) Fund for Industrial Financing; (8) Benefits to Free Industrial Zones; (9)
 Preferential Export Insurance; and (10) Countertrade. This review covers 72 producers
 and exporters of the subject merchandise (See Appendix I of this notice for a listing of the
 72 signatory producers and exporters).

 Analysis of Comments Received

 We gave interested parties an opportuntiy to comment on the preliminary results. We
 received three comments from the respondents, Asociacion Colombiana de Exportadores
 de Flores ("Asocolflores"), the Association of Floral Importers of Florida ("A.F.I.F."),
 Agrodex Ltda., Claveles Colombianos Ltda., and Horticultura de la Savana.

 Comment 1: The respondents argue that the Department erred in its preliminary
 determination by applying its new benchmark interest rates retroactively for short- and
 long-term loans. The respondents state that any new benchmark interest rates should be
 applied only prospectively, and that during calendar year 1989, the benchmark interest
 rates in effect were 22.5 percent for short- term loans and 21.0 percent for long-term
 loans. In addition, the respondents state that the signatories to the suspension agreement
 complied with its terms because the Export Promotion Fund ("PROEXPO"), an agency of
 the Colombian government, provided loans to flower growers at interest rates at or
 exceeding the previously set benchmark interest rates.

 Department's position: The Department agrees that any changes to short- term and
 long-term benchmark interest rates for this suspension agreement should be set
 prospectively. For purposes of this review, the benchmark interest rates for short-term
 and long-term loans pursuant to the suspension agreement are 22.5 percent and 21.0
 percent, respectively. These are the rates that the Department established for short- and
 long-term benchmark interest rates in 1986. The short-term rate is the average rate of the
 Fondo Financiero Agropercuario ("FFA") and the Caja Agrarian Fund, and the long-term
 rate is the FFA interest rate. The Department recognizes that the signatories to the
 suspension agreement complied with the terms of the agreement during the period of
 review.

 We note that we have revised the short-term and long-term benchmark interest rates (See
 Comment 2), and that the new rates will apply to loans granted after the date of
 publication of this notice.

 Comment 2: The respondents contend that the Department's use of the FFA and Caja
 Agrarian Fund interest rates as benchmarks for short- and long-term interest rates are
 inappropriate because they are fixed rates and that the Department should have used the
 Depositos a Termino Fijo ("DTF") rate, the certificate of deposit rate, as the benchmark.
 The respondents state that, since the signing of the suspension agreement, PROEXPO has
 switchd from fixed- rates to variable-rates based on the DTF rate. Each PROEXPO loan is
 tied to the 90-day certificate of deposit interest rate in effect at the time the loan was
 made. In addition, the respondents state that establishing a fixed benchmark based on
 1989 interest rates precludes flower growers from benefiting from any reduction in
 inflation.

 Department's position: We agree that the appropriate benchmark should be variable
 because Colombia has moved from fixed-rates to variable rates based on the DTF.
 Respondents argue that the appropriate variable benchmark should be the DTF rate.
 However, they have not established that alternate sources of financing, other than that
 provided through PROEXPO, would also be provided at the DTF rate. Respondents stated
 in their response to our supplemental questionnaire that the main sources of financing for
 the agricultural sector in Colombia are the FFA and the Caja Agrarian Fund, in addition
 to the PROEXPO loans covered by the suspension agreement.

 The Department has determined that effective January 1, 1990, the Colombian
 government has changed the FFA rate from a fixed interest rate to a variable rate based
 on the DTF rate. Therefore, the Department is setting the benchmark interest rate at the
 FFA rate since it is variable and it is the general lending rate for agricultural financing in
 Colombia. The short-term benchmark interest rate is DTF+1 and long-term benchmark
 interest rate is DTF+1 plus 0.25 percentage points for each additional year after the first
 year, including any grace period. These benchmarks will apply to loans granted after the
 date of publication of this notice.

 Comment 3: The respondents argue that in the event the Department chooses to establish
 a fixed short-term 

*14241

 benchmark rate, the rate determined in the preliminary results
 is incorrect.

 Department's position: This point is moot. See our response to Comment 2.

 Final Results of Review

 After considering the comments received, we determine that the signatories to the
 suspension agreement have compiled with the terms of the suspension agreement during
 the period January 1, 1989 through December 31, 1989.
 The agreement can remain in force only as long as shipments covered by it account for at
 least 85 percent of exports of such merchandise to the United States. We have determined
 from the questionnaire response that the signatories comprised over 97 percent of
 exports of the merchandise to the United States during the period of review.
 This administrative review and notice are in accordance with section 751(a)(1) of the
 Tariff Act (19 U.S.C. 1675(a)(1)) and 19 CFR 355.22.
 Dated: March 29, 1991.

 Eric I. Garfinkel,

 Assistant Secretary for Import Administration.

 Appendix I

 Agricola La Corsaria
 Agricola La Maria Ltda.
 Agricola Las Cuadras Ltda.
 Agricola Los Arboles
 Agricola Guacatai
 Agricola Papagayo Ltdaagrodex Ltda.
 Agroindustria Del Rio Frio
 Agrosuba
 Agropecuaria Mercantil (Agronec)
 Benavides Melo Oscar (F. La Loma)
 Claveles Colombianos Ltda.
 Claveles De Los Alpes
 Deflor Ltda.
 Disagro Ltda.
 Fantasia Flowers Ltda.
 Floramerica
 Flora Bellisina
 Flores Aguila Ltda.
 Flores Alfaya Ltda.
 Flores Altamira
 Flores Calandaima
 Flores Clolombianas Ltda.
 Flores Colon Ltda.
 Flores De Funza, S.A.
 Flores De La Sabana
 Flores De Los Amigos Ltda.
 Flores De Los Andes Ltda.
 Flores De Suesca Ltda.
 Flores Del Bosque
 Flores Del Pinar
 Flores Del Potrero Ltda.
 Flores El Danubio Ltda.
 Flores El Puente Ltda.
 Flores El Zorro
 Flores Generales Ltda.
 Flores Gicro
 Flores La Union
 Flores Marandua Ltda.
 Flores Rionegro Ltda.
 Flores Tiba Ltda.
 Flores Tibati Ltda.
 Florees Tropicales Ltda.
 Flores Urimaco Ltda.
 Floresa
 Florval S.A.
 Florex S.A.
 Horticultura Del La Sabana
 Innovaction Andina
 Inverfloresinverpalmas Ltda.
 Inversiones Calipso S.A.
 Inversiones Cien Ltda.
 Inversiones Oro Verde
 Inversiones Santa Rita Ltda.
 Iturrama
 Jardines Fredonia Limitada
 Jardines Matalia
 Linda Colombiana
 Las Amalias S.A.
 M.G. Consultores
 Mercedes Ltda.
 Pompones Ltda.
 Productos Agricolas De Exporacion
 Productos Alimenticious
 Queen's Flowers De Colombia Ltda.
 Sandra Patricia Rey
 Santa Helena, S.A.
 Santana Flowers Ltda.
 Shasta Flowers Y Cia Ltda.
 Splendid Flowers Ltda.
 Tuchany S.A.
 Universal De Flores, Ltda.
 Valencia Botero Jaime (Agrobarbo)
 [FR Doc. 91-8192 Filed 4-5-91; 8:45 am]

 BILLING CODE 3510-DS-M