[Federal Register: October 10, 2001 (Volume 66, Number 196)]        
[Page 51640-51642]
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DEPARTMENT OF COMMERCE

International Trade Administration

[C-475-819]

 
Final Results of Sunset Review: Countervailing Duty Order on 
Certain Pasta From Italy

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

ACTION: Notice of Final Results of Expedited Sunset Review: 
Countervailing Duty Order on Certain Pasta from Italy.

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SUMMARY: On June 1, 2001, the Department of Commerce (``the 
Department'') initiated a sunset review of the countervailing duty 
order on certain pasta (``pasta'') from Italy (66 FR 29771) pursuant to 
section 751(c) of the Tariff Act of 1930, as amended (``the Act''). On 
the basis of a notice of intent to participate and adequate substantive 
comments filed on behalf of the domestic interested parties, and 
inadequate response from respondent interested parties, we determined 
to conduct an expedited (120-day) sunset review of this countervailing 
duty order. Based on our analysis of the comments received, we find 
that revocation of the countervailing duty order would be likely to 
lead to continuation or recurrence of a countervailable subsidy. The 
net countervailable subsidy and the nature of the subsidy are 
identified in the Final Results of Review section of this notice.

EFFECTIVE DATE: October 10, 2001.

FOR FURTHER INFORMATION CONTACT: Martha V. Douthit or Carole A. 
Showers, Office of Policy for Import Administration, International 
Trade Administration, U.S. Department of Commerce, 14th Street and 
Constitution Avenue, NW., Washington, DC 20230; telephone: (202) 482-
5050 or (202) 482-3330, respectively.

SUPPLEMENTARY INFORMATION:

Statute and Regulations

    Unless otherwise indicated, all citations to the Act are references 
to the provisions effective January 1, 1995, the effective date of the 
amendments made to the Act by the Uruguay Round Agreement Act 
(``URAA''). The Department's procedures for the conduct of sunset 
reviews are set forth in Procedures for Conducting Five-year ( 
``Sunset'') Reviews of Antidumping and Countervailing Duty Orders, 63 
FR 13516 (March 20, 1998) (``Sunset Regulations''), and in 19 CFR Part 
351 (2000) in general. Guidance on methodological or analytical issues 
relevant to the Department's conduct of sunset reviews is set forth in 
the Department's Policy Bulletin 98:3 Policies Regarding the Conduct of 
Five-year (``Sunset'') Reviews of Antidumping and Countervailing Duty 
Orders; Policy Bulletin, 63 FR 18871 (April 16, 1998) (``Sunset Policy 
Bulletin'').

Scope of Order

    Imports covered by this review are shipments of certain non-egg dry 
pasta in packages of five pounds (2.27 kilograms) or less, whether or 
not enriched or fortified or containing milk or other optional 
ingredients such as chopped vegetables, vegetable purees, milk, gluten, 
diastases, vitamins, coloring and flavorings, and up to two percent egg 
white. The pasta covered by this scope is typically sold in the retail 
market, in fiberboard or cardboard cartons, or polyethylene or 
polypropylene bags, of varying dimensions. Excluded from the scope of 
this order are refrigerated, frozen, or canned pastas, as well as all 
forms of egg pasta, with the exception of non-egg dry pasta containing 
up to two percent egg white. Also excluded are imports of organic pasta 
from Italy that are accompanied by the appropriate certificate issued 
by the Istituto Mediterraneo Di Certificazione (``IMC''), by 
Bioagricoop Scrl, by QC&I International Services, by Ecocert Italia, by 
the Conzorzio per il Controllo dei Prodotti Biologici, or by the 
Associazione Italiana per l'Agricoltura Biologica. The merchandise 
subject to this order is currently classifiable under item 1902.19.20 
of the Harmonized Tariff Schedule of the United States

[[Page 51641]]

(``HTSUS''). Although the HTSUS subheading is provided for convenience 
and customs purposes, the written description of the merchandise 
subject to the order is dispositive.

Scope Rulings

    (1) On August 25, 1997, the Department issued a scope ruling that 
multicolored pasta, imported in kitchen display bottles of decorative 
glass that are sealed with cork or paraffin and bound with raffia, is 
excluded from the scope of the countervailing duty order. (See August 
25, 1997 memorandum from Edward Easton to Richard Moreland, which is on 
file in Central Record Unit (``CRU'') in Room B-099 of the main 
Commerce building.)
    (2) On July 30, 1998, the Department issued a scope ruling, finding 
that multipacks consisting of six one-pound packages of pasta that are 
shrink-wrapped into a single package are within the scope of the 
countervailing duty order. (See July 30, 1998 letter from Susan H. 
Kuhbach, Acting Deputy Assistant Secretary for Import Administration, 
to Barbara P. Sidari, Vice President, Joseph A. Sidari Company, Inc., 
which is on file in the CRU).
    (3) On October 26, 1998, the Department self-initiated a scope 
inquiry to determine whether a package weighing over five pounds as a 
result of allowable industry tolerances may be within the scope of the 
countervailing duty order. On May 24, 1999, we issued a final scope 
ruling finding that, effective October 26, 1998, pasta in packages 
weighing or labeled up to (and including) five pounds four ounces is 
within the scope of the countervailing duty order. (See May 24, 1999 
memorandum from John Brinkmann to Richard Moreland, which is on file in 
the CRU.

Background

    On June 1, 2001, the Department initiated a sunset review of the 
countervailing duty order on pasta from Italy (66 FR 29771), pursuant 
to section 751(c) of the Act). The Department received a Notice of 
Intent to Participate on behalf of New World Pasta, American Italian 
Pasta Company, Borden Foods Corporation, and Dakota Growers Pasta 
Company (collectively, ``the domestic interested parties''), on June 
15, 2001, within the applicable deadline specified in section 
351.218(d)(1)(i) of the Sunset Regulations. Pursuant to section 
771(9)C) of the Act, the domestic interested parties claimed 
interested-party status as domestic producers of certain pasta. The 
domestic interested parties assert that most of them participated in 
the original investigation and the scope clarification proceeding.\1\ 
The domestic interested parties are fully committed to full 
participation in this sunset review to preserve and maintain the 
countervailing duty order.\2\ We received complete substantive response 
from the domestic interested parties on July 16, 2001, within the 30-
day deadline specified in the Sunset Regulations under section 
351.218(d)(3)(i).
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    \1\ See Substantive Response by the Domestic Industry, Sunset 
Review of the Countervailing Duty Order on Certain Pasta from Italy, 
July 2, 2001, at 4.
    \2\ Id.
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    On June 29, 2001, we received a request for an extension to file 
substantive responses and rebuttal comments from the domestic 
interested parties.\3\
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    \3\ On June 29, 2001, the Department received a letter from the 
domestic interested parties regarding request for additional time to 
file substantive and rebuttal comment in this sunset review. On June 
29, 2001, the Department granted the extension to the domestic 
parties and to all participants to file substantive and rebuttal 
comments. Pursuant to 19 CFR 351.302(b), the deadline for all 
parties for filing substantive responses was extended to July 16, 
2001. Pursuant to 19 CFR 351.218(d)(4), the deadline for filing 
rebuttal comments was therefore extended to July 23, 2001 for all 
parties. In this case, no rebuttal briefs were filed.
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    On June 28, 2001, we received a response from the European Union 
Delegation of the European Commission (``EC''), expressing its 
willingness to participate in this review as the authority responsible 
for defending the interest of the Member States of the European Union 
(``EU'').\4\ We received also a response from the Government of Italy 
(``GOI''), on June 29, 2001 expressing its willingness to participate 
in this review as the government of a country in which the subject 
merchandise is produced and exported. On July 16, 2001 we received a 
complete response from interested parties, Rienzi & Sons, Inc. 
(``Rienzi'') an importer of pasta from Italy, and N. Puglisi & F. 
Industria Paste Alimentari S.p.A. (``Puglisi'') an Italian producer of 
pasta. Rienzi and Puglisi claim interested-party status pursuant to 
section 771(9)(A) of the Act. The GOI and the EU claim interested-party 
status in this sunset review pursuant to section 771(9)(B) of the 
Act.\5\
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    \4\ See June 28, 2001 Response of the EC.
    \5\ See June 29, 2001 Response of the GOI.
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    On July 23, 2001, the Department determined that the response of 
the respondent interested parties in this review was inadequate.\6\ As 
a result, pursuant to 19 CFR 351.218(e)(2)(ii)(C), the Department 
determined to conduct an expedited, 120-day, review of the 
countervailing duty order on pasta from Italy.\7\
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    \6\ Section 351.218 (e)(1)(ii)(C)(2) provides that, where 
respondent interested parties provide inadequate response, the 
Department will conduct an expedited sunset review under section 
751(c)(3)(B) of the Act and issue final results of review based on 
the facts available.
    \7\ See July 23, 2001, Letter from Jeffrey A. May, Director, 
Office of Policy to Lynn Featherstone, Director, Office of 
Investigations, International Trade Commission, regarding Pasta from 
Italy: Expedited Sunset Reviews of Antidumping and Countervailing 
Duty Orders.
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Analysis of Comments Received

    All issues raised by parties to this sunset review are addressed in 
the Issues and Decision Memorandum (``Decision Memorandum'') from 
Jeffrey A. May, Director, Office of Policy, Import Administration, to 
Faryar Shirzad, Assistant Secretary for Import Administration, dated 
October 1, 2001, which is hereby adopted by this notice. The issues 
discussed in the Decision Memorandum include the likelihood of 
continuation or recurrence of dumping and the magnitude of the margins 
likely to prevail were the order to be revoked. Parties can find a 
complete discussion of all issues raised in these reviews and the 
corresponding recommendations in this public memorandum, which is on 
file in the Central Records Unit, room B-099, of the main Commerce 
building. In addition, a complete version of the Decision Memorandum 
can be accessed directly on the Web at https://enforcement.trade.gov/frn, under 
the heading ``October 2001.'' The paper copy and electronic version of 
the Decision Memorandum are identical in content.

Final Results of Review

    We determine that revocation of the countervailing duty order on 
pasta from Italy would likely lead to continuation or recurrence of a 
countervailable subsidy at the rates listed below:

------------------------------------------------------------------------
                                                               Net
                 Manufacturer/producer                   countervailable
                                                             subsidy
------------------------------------------------------------------------
Agritalia, S.r.l.......................................         3.03
Arrighi S.p.A. Industrie Alimentari....................         2.92
De Matteis Agroalimentare S.p.A........................         2.55
Delverde, S.r.l........................................         4.04
F.lli De Cecco di Filippo Fara S. Martino S.p.A........         3.47
Industria Alimentare Colavita, S.p.A...................         2.08
Isola del Grano S.r.L..................................        11.71
Italpast S.p.A.........................................        11.71
Italpasta S.r.L........................................         2.92
La Molisana Alimentari S.p.A.,.........................         3.94
Labor S.r.L............................................        11.71
Molino e Pastificio De Cecco S.p.A. Pescara............         3.47

[[Page 51642]]


Pastificio Guido Ferrara...............................         1.41
Pastificio Campano, S.p.A..............................         2.54
Pastificio Riscossa F.lli Mastromauro S.r.L............         6.48
``All Other'' Manufacturers/producers/exporters........        3.89
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Barilla G.e R. F.lli S.p.A (``Barrilla'') and Gruppo Agricoltura Sana
  S.r.L. (``Gruppo'') are excluded the countervailing duty order on
  pasta from Italy.

Nature of Subsidies

    In the Sunset Policy Bulletin, the Department states that, 
consistent with section 752(a)(6)of the Act, the Department will 
provide to the Commission information concerning the nature of the 
subsidy, and whether the subsidy is a subsidy described in Article 3 or 
Article 6.1 of the Subsidies Agreement. In this review we find that 
three of the programs included in the calculations of the net 
countervailable subsidy fall within the definition of an export subsidy 
under Article 3.1(a) of the Subsidies Agreement. They are: Export 
Marketing Grants Under Law 304/90, Remission of Taxes on Export Credit 
Insurance Under Article 33 of Law 227/77, and the Export Restitution 
Program. Furthermore, some or all of the programs at issue could be 
found to be inconsistent with Article 6.1. For example, the net 
countervailable subsidy may exceed five percent, as measured in 
accordance with Annex IV of the Subsidies Agreement. The Department, 
however, has no information with which to make such a calculation; nor 
do we believe it appropriate to attempt such a calculation in the 
course of a sunset review. Moreover, we note that, as of January 1, 
2000, Article 6.1 has cease to apply (see Article 31 of the Subsidies 
Agreement). As such, we are providing the Commission with program 
descriptions in our Decision Memo.
    This notice serves as the only reminder to parties subject to 
administrative protective order (``APO'') of their responsibility 
concerning the disposition of proprietary information disclosed under 
APO in accordance with 19 CFR 351.305 of the Department's regulations. 
Timely notification of return/destruction of APO materials or 
conversion to judicial protective order is hereby requested. Failure to 
comply with the regulations and the terms of an APO is a sanctionable 
violation.
    This five-year (``sunset'') review and notice are in accordance 
with sections 751(c), 752, and 777(i)(1) of the Act.

    Dated: October 1, 2001.
Joseph A. Spetrini,
Acting Assistant Secretary for Import Administration.
[FR Doc. 01-25407 Filed 10-9-01; 8:45 am]
BILLING CODE 3510-DS-P