Mexico’s tomato industry will be heard by the U.S. Court of International Trade in New York on May 16 to receive legal support contradicting the May 7 withdrawal of the Tomato Suspension Agreement.
Mexican tomato interests have petitioned this court for an injunction to stop the U.S. Commerce Department from going forward with the termination of the agreement. They are also working through the legal channel to stop cash deposits from being imposed on the sale of Mexican tomatoes. The basis for this lawsuit is that the Commerce Department’s withdrawal from the TSA was unlawful, according to Shearman & Sterling, the Washington, DC-based law firm representing the Mexican growers.
Rosario Beltran
The U.S. Court of International Trade has nationwide jurisdiction over civil actions arising out of the customs and international trade laws of the United States.
A statement by a Mexican tomato grower consortium of five organizations on May 13 indicates that “proposals from the Florida Tomato Exchange for more than a year … include several demands that are unlawful, which is the reason the [Mexican] growers rejected the Commerce Department’s latest proposal last Friday,” May 10.
“That proposal would have stripped U.S. supermarkets and other buyers of Mexican tomatoes of their legal rights to reject tomatoes with condition defects and be reimbursed for their costs.”
On a parallel course, on May 15 Nogales-based Fresh Produce Association of the Americas released a statement urging “the Department of Commerce to continue to work with the Mexican growers of fresh tomatoes to create an updated Tomato Suspension Agreement that remains within the scope of the law. The FPAA acknowledges the difficult task of balancing an agreement that fairly addresses Florida concerns while not catering to Florida’s pressure to create an agreement that no U.S. supermarket could agree to, and which would effectively prevent supermarkets from purchasing Mexican tomatoes.”
The FPAA maintained that it is confident “that rational proposals from Commerce and the Mexican growers can result in an agreement that fairly addresses Florida concerns without unduly harming American shoppers and the entire U.S. tomato industry.”
The FPAA continued, “It is no surprise to read in the most recent release from the Mexican growers that the Florida Tomato Exchange continues to ask for protections outside the scope of existing U.S. law, including asking for major changes that would effectively block imports of Mexican tomatoes by making it economically risky for U.S. buyers.”
James Munguia, the FPAA tomato division chairman, outlined “the harm that FTE seeks to inflict on the industry by denying buyers’ rights to reject tomatoes and seek allowed reimbursements for certain costs.”
According to Shearman & Sterling, the Mexican growers have taken several key actions to protect their legal rights in light of several disappointing actions taken by the U.S. Commerce Department. Beyond the aforementioned injunctions, “the Mexican growers shortened the period they will be subject to cash deposits by 60 days. If the resumed investigation does go forward, the Commerce Department must now conclude its dumping determination on July 21, and the U.S. International Trade Commission must conclude its injury determination on September 4.”
Shearman & Sterling stated: “While the Mexican growers remain committed to a new agreement, it must be fully reflective of U.S. law and the evidence on the record of the proceeding. The Mexican growers will continue to work with the Commerce Department to that end. Otherwise, they look forward to the outcome of the investigation, in which they will seek vindication at the International Trade Commission from FTE’s baseless claims of injury. The growers were denied their legal right to have the ITC consider whether the Florida growers have the right to any protection at all in the recent sunset review because the Commerce Department terminated the agreement two days before the ITC’s scheduled vote. That right to a so-called ‘sunset review,’ in which the need for continued protection is reviewed every five years, is required under U.S. law and U.S. commitments under the World Trade Organization agreement.”
Rosario Beltran, president of the Mexican grower association, CAADES, indicated, “We would prefer to continue the stability that the suspension agreement has brought to the U.S. tomato market for the past 22 years. But we need a fair deal and one that does not require us to enter contracts that strip our U.S. customers of their legal rights.”
Robert LaRussa, who is a regulatory expert for Sherman & Sterling, told The Produce News May 15 that Mexican interests have accepted many of the proposals offered by the Florida Tomato Committee. For example, he said Mexican interests agreed to raise reference prices. But the Mexicans cannot accept the idea of limiting buyers’ rights. “It’s not our job to take away the rights of legal contracts.”
