LIQ-4-01-CO:R:C:E 225107 AJS
District Director of Customs
U.S. Customs Service
300 S. Ferry Street
Terminal Island
San Pedro CA 90731
RE: Protest 2704-93-103333; acrylic sheet; antidumping; 19 U.S.C.
1504(d); suspension of liquidation is lifted when Customs receives
instructions from Commerce; American Permac v. U.S.; HQ 224778;
Pagoda Trading Corp. v. U.S.; Canadian Fur Trappers Corp. v. U.S.;
Nunn Bush Shoe Co. v. U.S.; section 632(d) NAFTA Implementation
Act.
Dear Sir:
This is our decision in protest 2704-93-103333, dated October
14, 1993, concerning the lifting of liquidation suspensions.
FACTS:
The merchandise at issue is acrylic sheet from Japan. The
sheet was manufactured by Nitto Jushi Kogyo and imported during the
period October 1980 through July 1981. The subject entries were
subject to an affirmative antidumping finding issued by the
Treasury Department on August 20, 1976 (Treasury Decision 76-240).
The subject entries were subject to the Department of Commerce's
(DOC) second administrative review of the 1976 antidumping finding
conducted in accordance with 19 U.S.C. 1675. This review covered
entries of acrylic sheet imported from Japan during the period
August 1, 1980 through July 31, 1981. The final results of the
second administrative review covering acrylic sheet from Japan were
published in the Federal Register on July 29, 1983 (48 Fed. Reg.
34,490). These results state that the DOC "shall determine and the
U.S. Customs Service shall assess, dumping duties on all entries
with purchase
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dates during the period involved." These results also state that
the DOC "will issue appraisement instructions on each exporter
directly to the Customs Service."
Customs did not receive appraisement or liquidation
instructions from the DOC for the subject entries until July 1,
1993. No reason is given for this delay. Based on these
instructions, the subject entries were promptly liquidated on July
30, 1993.
ISSUE:
Whether the subject entries were deemed liquidated by
operation of law pursuant to 19 U.S.C. 1504(d). More specifically,
at what point was the suspension of liquidation lifted on the
subject entries.
LAW AND ANALYSIS:
Initially, we note that this protest was timely filed pursuant
to 19 U.S.C. 1514(c)(2)(A). The subject entries were liquidated on
July 30, 1993 and this protest was filed on October 14, 1993. We
also note that this protest is a protestable matter pursuant to 19
U.S.C. 1514(a)(5).
Liquidation of an entry constitutes the final computation by
Customs of all duties (including any anti- dumping or
countervailing) accruing on that entry. See generally, Ambassador
Division of Florsheim Shoes v. United States, 748 F.2d 1560, 1562
(Fed. Cir. 1984). The Customs Procedural Reform and Simplification
Act of 1978 provides in section 209(a), 19 U.S.C. 1504, that an
entry is deemed liquidated as entered if Customs has not liquidated
the entry within one year from the date of entry or withdrawal from
warehouse. Customs is permitted to extend the one year period,
under 19 U.S.C. 1504(b), if liquidation is suspended by statute or
court order. The subject entries were suspended pursuant to 19
U.S.C. 1673 pending the results of an antidumping administrative
review.
On July 29, 1983, the DOC published the final results of the
administrative review for the subject entries. The protestant
asserts that the suspension of liquidation for the subject entries
was lifted at this time. However, these results state that the DOC
shall determine and Customs shall assess dumping duties on
applicable entries, and that the DOC will issue appraisement
instructions to Customs. Consequently, until Customs received
these instructions it was unable to liquidate the subject entries.
In HQ 224778
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(December 23, 1993), Customs ruled that a suspension of liquidation
is not lifted until instructions are received from the DOC. This
ruling is supported by various statements of the courts. The Court
of International Trade (CIT) stated that Customs obligation to
collect antidumping duties does not arise until the DOC has
"furnished" Customs with the determination upon which assessments
must be predicated. American Permac, Inc. v. United States, 10 CIT
535, 542 (1986). The CIT and the Court of Appeals for the Federal
Circuit also referred to the DOC as having "notified" or "directed"
Customs to proceed with liquidation. See Pagoda Trading Corp. v.
United States, 9 CIT 407, 408 (1985), aff'd 5 Fed. Cir. (T) 10, 14
(1986). In this protest, liquidation instructions were not
received until July 1, 1993. Therefore, the suspension of
liquidation on the subject entries was not lifted until July 1,
1993.
The CIT also addressed the application of 19 U.S.C. 1504(d) in
Canadian Fur Trappers Corp. v. United States (Fur Trappers), 12 CIT
612 (1988), aff'd 7 Fed. Cir. (T) 136, 139 (1989). In that case,
the suspension of the entries involved was lifted after four years
from the date of entry. The CIT stated that when a suspension is
lifted after four years have passed, Customs has a discretionary 90
days to liquidate the entries. Fur Trappers at 618, See also Nunn
Bush Shoe Co. v. United States (Nunn Bush), 784 F. Supp. 892, 894
(1992). This decision was based on the legislative history for
section 1504(d) which states that "[t]his last provision is
discretionary, rather than mandatory, and recognizes that there
will be instances when it may be impossible to complete liquidation
within 90 days because of the sheer number of entries to be
liquidated after a long continued suspension." Fur Trappers at
616, See also H.R. Rep. No. 95-621, 95th Cong., 1st sess. 26
(1977). The subject entries were also suspended more than four
years from the date of entry, and liquidated 29 days from the date
the suspension was lifted. Thus, the subject entries were timely
liquidated under the rationale of the Fur Trappers decision.
In Fur Trappers, the CIT also referred to Customs liquidating
entries "pursuant to instructions" by the DOC. Fur Trappers at
613. The plaintiff in Fur Trappers highlighted that once Customs
was notified liquidation could commence, liquidation commenced
within 90 days. Id. at 617. In this protest, once Customs was
notified liquidation commenced in 29 days. The plaintiff in Fur
Trappers also alleged that the real controversy was Commerce's
failure to promptly notify Customs that it should proceed with
liquidation. This also appears to be the real controversy in
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this protest. The CIT stated that the DOC did not offer an
explanation as to why its directions to Customs were not
expeditiously issued. Id. In this protest, the DOC also did not
offer an explanation for the delay in issuance of its instructions
to Customs. The CIT lastly stated that "it is troublesome that
this provision [i.e., 1504(d)], which was intended to afford
latitude to Customs in complicated liquidations, has the potential
for abuse when Commerce invokes its protection to justify the
agency's own lack of diligence." Id. Despite this statement,
however, the CIT did not determine that the entries were deemed
liquidated pursuant to section 1504(d). Therefore, we find the
above facts and language from Fur Trappers instructive for
determining that the subject entries were not deemed liquidated
pursuant to section 1504(d).
Section 1504(d) was amended by Section 632, title VI - Customs
Modernization, Public Law 103-182, the North American Free Trade
Agreement (NAFTA) Implementation Act (107 Stat. 2057), enacted
December 8, 1993. Section 692 states that title VI is effective on
the date of enactment of the Act. Section 632(d) states that
"[w]hen a suspension required by statute or court order is removed,
the Customs Service shall liquidate the entry within 6 months after
receiving notice of the removal from the Department of Commerce .
. ." Further- more, this section provides "[a]ny entry not
liquidated by the Customs Service within 6 months after receiving
such notice shall be treated as having been liquidated at the rate
of duty, value, quantity, and amount of duty asserted at the time
of entry by the importer of record." As stated previously, the
subject entries were liquidated 29 days after receiving notice from
Commerce. Therefore, these entries were also timely liquidated
under section 632 of the NAFTA Implementation Act.
HOLDING:
The protest is denied. The subject entries were not deemed
liquidated by operation of law pursuant to 19 U.S.C. 1504(d). More
specifically, the date for lifting of the liquidation suspension
was the date Customs received instructions from the DOC to
liquidate the subject entries.
In accordance with Section 3A(11)(b) of Customs Directive 099
3550-065, dated August 4, 1993, Subject: Revised Protest Directive,
this decision should be mailed, with the Customs Form 19, by your
office to the protestant no later than 60 days from the date of
this letter. Any reliquidation of the entry in accordance with the
decision must be accomplished prior to mailing of the decision.
Sixty
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days from the date of the decision the Office of Regulations and
Rulings will take steps to make the decision available to customs
personnel via the Customs Rulings Module in ACS and the public via
the Diskette Subscription Service, Lexis, Freedom of Information
Act and other public access channels.
Sincerely,
John Durant, Director
Commercial Rulings Division