LIQ-4-01/LIQ-11/PRO-4-CO:R:C:E 225121 PH
District Director of Customs
Chicago, Illinois 60607
RE: Application for Further Review of Protest No. 3901-93-
101190; Antidumping Duties; Reimbursement Certification;
Deemed Liquidation; Time for Liquidation after Removal of
Suspension of Liquidation; Nunn Bush Shoe Co. v. United
States; 19 CFR 353.26; 19 U.S.C. 1504(d); 19 U.S.C. 1514
Dear Sir:
The above-referenced protest was forwarded to this office
for further review. The protestant filed supplemental
submissions, dated December 10 and 16, 1993, on this matter,
copies of which we are enclosing for the protest file. We have
considered the points raised by your office and the protestant.
Our decision follows.
FACTS:
According to the file, between August 25 and December 15,
1986, the importer entered certain merchandise (certain carbon
steel fittings) from Taiwan. Eight entries are involved in the
protest. The protestant acted as surety for the entries.
The merchandise under consideration was the subject of an
antidumping investigation (case A-583-602) (Federal Register of
March 24, 1986 (51 FR 10070)). In a notice of preliminary
determination (Federal Register of August 11, 1986 (51 FR
28735)), Customs was directed to suspend liquidation of all
entries of such merchandise that are entered, or withdrawn from
warehouse, for consumption, on or after the date of publication.
A final determination was published in the Federal Register on
October 24, 1986 (51 FR 37772), pursuant to which Customs was
directed to continue to suspend liquidation of entries of the
merchandise. On December 17, 1986, in an Antidumping Duty Order,
the International Trade Administration (ITA) published a
determination in the Federal Register (51 FR 45153) that
importations of the merchandise materially injure a United States
industry and Customs was directed to require a cash deposit based
on the estimated weighted-average antidumping duty margins
provided in the notice.
Pursuant to the above determinations, the importer
deposited antidumping duties for the entries protested in the
total amount of $112,059.66. In its letters depositing the
antidumping duties, the importer stated that it was depositing
the antidumping duties under "protest," basically on the basis
that the merchandise under consideration was already shipped when
the antidumping duties became applicable.
On February 8, 1988, Customs issued a telegram (No. 001557,
Subject: Antidumping Duties (88-16)) advising that the Depart-
ment of Commerce had not received a request for an administrative
review of the antidumping duty finding/order for certain periods
on merchandise listed in the telegram. Therefore, Customs offic-
ers were directed to assess antidumping duties on the subject
merchandise entered, or withdrawn from warehouse, for consumption
during the periods listed in the telegram at the cash deposit or
bonding rate required at the time of entry. The instructions for
the merchandise under consideration were to "liquidate all
entries for all firms [for the] period [of] 8/11/86 - 11/30/87".
Customs sent a Customs Form 28, Request for Information, to
the importer on January 15, 1991, in which Customs requested the
importer to complete and return an attached "reimbursement
statement" form. This form listed each of the protested entries
and stated that pursuant to 19 CFR 353.55, the certification on
the form must be furnished (this requirement is now in 19 CFR
353.26). The certification on the form concerned whether the
importer had entered into any agreement or understanding for the
payment or refunding to the importer by the manufacturer,
producer, seller or exporter of all or any part of the
antidumping duties upon the listed entries.
On December 21, 1991, Customs sent a Customs Form 29,
Notice of Action, to the importer. This notice was in regard to
the protested entries, which were listed in the notice. Customs
stated in the notice that antidumping duties had been deposited
for the protested entries and enclosed another "reimbursement
statement" form, as described above. Customs requested the im-
porter to complete and return the reimbursement notice. Customs
stated that failure to complete and return the reimbursement
notice would result in a presumption that reimbursement occurred
and an additional assessment equal to the total dumping duties
deposited at the time of entry would be made. Customs further
advised the importer that, in general, if reimbursement is made
or expected, additional duties would be assessed in the amount of
the reimbursement. According to the box checked on the Customs
Form 29, if the importer disagreed with the proposed action, the
importer was requested to furnish its reasons in writing to
Customs within 20 days from the date of the notice; after 20 days
the entry was to be liquidated as proposed.
The entries were liquidated on December 18, 1992, with an
increase in the antidumping duties in the total amount of
$112,059.66 (representing the additional assessment equal to the
total dumping duties deposited, on the basis that the
reimbursement notice was not returned to Customs, as provided for
in the above-referenced Customs Forms 28 and 29) for the
protested entries. On April 2, 1993, demand for payment of the
increased antidumping duties (i.e., the $112,059.66, plus
interest) was made on the protestant surety.
On June 22, 1993, the protestant filed the protest under
consideration. The basis of the protest was that, according to
the protestant, the liquidation resulted in the incorrect and
excessive assessment of duties, including countervailing and/or
antidumping duties. The protestant stated that it intended to
submit a supplemental memorandum in support of the protest.
The protestant did submit supplementary memorandums, dated
December 10 and 16, 1993, relating to the protest/application for
further review. The December 10 submission cited a June 5, 1991,
letter from the Department of Commerce to Customs relating to the
requirement for filing a reimbursement certificate. According to
this letter, for entries during the time-period in which the
protested entries were made, the Department of Commerce required
the importer to file a reimbursement certificate with Customs
within 30 days after the earlier of: (1) publication of the
antidumping order or any administrative review thereof pursuant
to 19 CFR 353.53, or, if appropriate, 19 CFR 353.49; or (2)
importation of the merchandise in a district in which not
previously imported (see also 19 CFR 153.55, between 1980 and
1989). The letter also stated that, "[i]f the importer goes out
of business before the deadline for filing the certificate has
passed, Customs should not presume that reimbursement has
occurred [and] if the importer goes out of business after the
deadline for filing the certificate has passed, Customs should
presume that reimbursement occurred." With its December 10
submission, the protestant also provided a copy of a report from
a financial investigative and reporting service indicating that
as of May 16, 1988, the importer had discontinued operations at
the address given in the entries under protest.
In the December 16, 1993, submission, the protestant argued
that Customs was without authority to liquidate the entries under
consideration because they were deemed liquidated as entered by
operation of law on the four-year anniversary date for each of
the entries, citing 19 U.S.C. 1504(d).
Further review for the protest was requested and granted.
ISSUE:
May the protest in this case be granted?
LAW AND ANALYSIS:
Initially, we note that the protest was timely filed (i.e.,
within 90 days of the demand upon the protestant surety; see 19
U.S.C. 1514(c)(2)) and the matter protested is protestable (see
19 U.S.C. 19 U.S.C. 1514(a)(5)). The certification that the
protest is not being filed collusively to extend another
authorized person's time to protest, as required for a protest by
a surety (see 19 U.S.C. 1514(c)(2)), was provided.
For your information, we note that each of the letters from
the importer purporting to "protest" the assessment of
antidumping duties (and depositing those antidumping duties) was
sent to Customs either before the dates of entries or, in the
case of one entry, 3 days after the date of entry. The purported
"protests" were filed before liquidation and, as such, are not
valid protests under 19 U.S.C. 1514 (see 19 U.S.C. 1514(c)(2);
Atari Caribe v. United States, 16 CIT ___, 799 F. Supp. 99
(1992); Peg Bandage, Inc., v. United States, 17 CIT ___, printed
in the January 5, 1994, edition of the Customs Bulletin and
Decisions, vol. 28, no. 1, p. 265; Spiegel Bros. v. United
States, 21 CCPA 310, T.D. 46831 (1933); and Gallagher & Ascher v.
United States, 21 CCPA 313, T.D. 46832 (1933)). According to
Customs records, the only protest of the entries under
consideration is the protest here considered (i.e., the protest
by the surety of the demand for payment of the additional
assessment of antidumping duties).
Because of our decision below on the "deemed liquidation"
issue under 19 U.S.C. 1504, we need not find whether the
additional assessment of antidumping duties was proper under the
applicable ITA Regulations, as explained in the June 5, 1991,
letter from the Department of Commerce to Customs (described
above). However, we note that the date of the antidumping order
in this case was December 17, 1986, and that according to the
February 8, 1988, Customs telegram issuing liquidation instruc-
tions (see above), there was no request for administrative review
of the antidumping order. You state that the date of first
importation of the merchandise in the Chicago district was August
13, 1986. The evidence submitted by the protestant on the date
the importer terminated operations at the address given in the
entries under protest indicates that the importer was not operat-
ing at the address given as of May 16, 1988. Thus, according to
the evidence presented, if the importer went out of business (we
note that the evidence is as to operations at one address) the
evidence that it may have done so is as of a date after the
deadline for filing the reimbursement certificate, in which case
the Department of Commerce advised in its June 5, 1991, letter
that Customs should presume that reimbursement occurred.
Notwithstanding the above, the controlling statute in this
matter is 19 U.S.C. 1504. This provision was amended by section
641 of Public Law 103-182, the North American Free Trade
Agreement Implementation Act (107 Stat. 2057, 2204), enacted
December 8, 1993. Before its amendment, section 1504 provided,
in pertinent part, that, except as otherwise provided in the
provision, an entry not liquidated within one year from the date
of entry was required to be deemed liquidated at the rate of
duty, value, quantity, and amount of duties asserted at the time
of entry by the importer of record. The exception to this
general rule was that Customs could extend the time for
liquidation or suspend the liquidation of the entry (suspension
of liquidation referred to cases in which liquidation was
suspended as required by statute or court order). When
liquidation of any entry was suspended, Customs was required to
provide notice of the suspension to the importer of record
concerned and to any authorized agent and surety of the importer
of record. Section 1504(d) provided that any entry not
liquidated at the expiration of four years from the date of entry
shall be deemed liquidated at the rate of duty, value, quantity,
and amount of duties asserted at the time of entry by the
importer of record, unless liquidation continued to be suspended
as required by statute or court order. The subsection also
provided that when such a suspension of liquidation was removed,
the entry was required to be liquidated within 90 days from the
date of removal.
This provision was interpreted in the case of Nunn Bush
Shoe Co. v. United States, 784 F. Supp. 892 (CIT 1992). The
Court held that when the liquidation of entries had been
suspended (under the countervailing duty law) and the suspension
of liquidation was terminated before the expiration of the four-
year period after the date of entry but the entry was not liquid-
ated within that 4-year period, section 1504 "unambiguously"
required the entries to be deemed liquidated by operation of law.
The Court held that any subsequent attempts to liquidate such
entries was invalid.
As stated above, section 641 of Public Law 103-182 amended
section 1504. As amended, section 1504(d) provides that:
When 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, other agency, or a court
with jurisdiction over the entry. Any 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.
In this case the relevant times are as follows:
Dates of entry: August 25 - December 15, 1986
Liquidation
instructions: February 8, 1988
Dates of liquidation: December 18, 1992
Thus, under either section 1504 before its amendment by
section 641 of Public Law 103-182 or section 1504 after the
amendment, the protested entries were required to be deemed
liquidated as entered before the December 18, 1992, date of
purported liquidation. I.e., under section 1504 before
amendment, as interpreted in the Nunn Bush case, supra,
liquidation was required before the four-year anniversary of the
entries, but the entries were not liquidated until after that
anniversary. Under section 1504 as amended, liquidation was
required within 6 months after Customs received notice of removal
of the suspension. Since the entries were not liquidated until
more than 4 years after issuance of the liquidation instructions,
they clearly were not liquidated within the required time. The
protest must be GRANTED.
HOLDING:
The protest (i.e., as to the demand on the surety for
payment of the increased antidumping duties) is GRANTED. 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 by your office, with the Customs
Form 19, 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 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
Enclosures