2001-12-31_REPORT - M2002004 - Laserfiche WebLink

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A,- 14 Arffi-c plrlgdi.be In 199o, the United States Department of Commerce (DOC) imposed an anti-dumping duty order on imports of Gray Portland Cement and Clinker from Mexico. As a result, beginning September 1994, RGPC has been subject to the payment of estimated anti-dumping duty deposits (which are expensed as incurred) on imports of Gray Portland Cement and Clinker from Mexico. The Mexican Government initiated a formal complaint against the United States Government under the General Agreement on Tariffs and Trade (GATT) for alleged violations of GATT obligations in the anti-dumping case. On July 9, 1992, a dispute settlement panel formed under the auspices of the GATT determined that the United States violated the GATT anti-dumping code and its own anti-dumping law, by imposing anti-dumping duties on Mexican cement. The panel stated that the United States must revoke the anti-dumping order and refund all anti-dumping duties that have been paid. Although this GATT panel decision is not independently enforceable under United States law, since November 1992, the United States and Mexican Governments have been engaged in consultations seeking a settlement that would include implementation of the GATT panel recommendations. From October 1995 through April 1997, the DOC performed its Fifth Administrative Review, covering sales of imported Mexican cement, made during the period from August 1994 through July 1995. The DOC published its final determination on April 1997, establishing a dumping margin rate of 73.69%. On June 1997, RGPC requested a review by a NAFTA Panel of DOC's final determination on the Fifth Administrative Review. In June 1999, the NAFTA binational panel decided, among other minor issues, that the DOC incorrectly compared sales of both bulk and bagged cement in Mexico with only bulk cement in the United States, and instructed the DOC to recalculate the dumping margin for the Fifth Administrative Review excluding from the comparisons the bagged cement in Mexico. In November 1999, the DOC issued its amended final results of the Fifth Administrative Review pursuant to the Panel's instructions, calculating a dumping margin of 44.89% (a decrease from the original 73.690. The DOC requested a NAFTA extraordinary challenge committee to review the Panel's decision. From October 1996 through March 2001, the DOC performed its Sixth, Seventh, Eighth and Ninth Administrative Reviews, covering sales of imported Mexican cement, made during the period from August 1995 through July 1999. The DOC published its final determination for the Sixth Administrative Review on March 1998, establishing a dumping margin rate of 37.49%. In March 1999, the DOC published its final determination for the Seventh Administrative Review establishing a dumping margin rate of 49.58%, an oral argument before the NAFTA panel review is scheduled for February 27, 2002. in March 2000, the DOC published its final determination for the Eighth Administrative Review establishing a dumping margin rate of 45.98%. In March 2001, a dumping margin of 39.34% was established and then amended in May 2001 to 38.65% (the current deposit rate) for the Ninth Administrative Review. RGPC has requested a review by a NAFTA Panel of the DOC's final determination on the Sixth, Seventh, Eighth and Ninth Administrative Reviews. In October 2000, the DOC initiated its Tenth Administrative Review, covering sales of imported Mexican cement, made during the period from August Ig99 through July 20oo. The DOC will publish its final determination in March 2002. The Eleventh Administrative Review was initiated in October 2001 for sales of imported Mexican cement during the period from August 2ooo through July 2001. On August 2, 1999 the international Trade Commission of the United States (ITC) initiated the Sunset Review of the anti-dumping order on Gray Portland Cement and Clinker from Mexico. The ITC reviewed the potential effect of revoking the order on the United States cement industry. On October 9, 2000, the ITC voted not to revoke the order, and thus the U.S. Customs Service will continue collecting anti-dumping deposits. Should the actual margin on the different administrative reviews be determined to be less than the amount of anti-dumping duties already deposited with the U.S. Customs Service, the difference, together with interest, will be refunded to RGPC. Should the actual margin be determined to be greater than the initial margin, then additional payments, including interest, will be required. RGPC has estimated to the best of its ability, the potential refunds or liabilities for the different administrative reviews, and depending on the final decisions by the NAFTA panels regarding the comparison of sales made in sack versus sales made in (Thousands of Mexican pesos with purchasing power at December 31. 2001 and thousands of U.S. dollars. except for per share values and exchange rates)