PRO-2-07-CO:R:C:E 225393 PH
District Director of Customs
U.S. Customs Service
200 East Bay Street, Room 121
Charleston, South Carolina 29401
RE: Protest No. 1601-94-100052; Jurisdiction over Protest;
Amendment of Protest; Number of Protests on Single Entry;
Denial of Protest; 19 U.S.C. 1514; 19 U.S.C. 1515
Dear Sir:
The above-referenced protest was forwarded to this office for
further review. We have considered the evidence provided, and
the points raised, by your office and the protestant. Our
decision follows.
FACTS:
According to the file, on December 2, 1993, the protestant
imported certain merchandise (the merchandise under consideration
is described in the entry summary as "wom[.] blouses, mn-mde,
oth, <2 colo") from Indonesia. According to our records, on
December 8, 1993, the merchandise was entered and released by
Customs. According to the commercial invoice for the
merchandise, the merchandise was subject to quota and a visa (for
category 647/648) was provided to Customs.
On January 10, 1994, Customs issued a Notice to Redeliver
(Customs Form 4647) to the protestant for the merchandise under
consideration. The basis for this Notice was stated to be
"Merchandise described and entered as ladies blouses, category
641. Upon examination of same style, same order#, on entry [#
stated], it was revealed that merchandise was actually jackets of
category 635. New visa for cat[.] 635 needed."
According to Customs records, the entry has not yet been
liquidated. On February 3, 1994, the protestant filed a protest,
without application for further review, of the Notice to
Redeliver. In an attachment to the protest, the protestant made
detailed arguments as to the classification of the merchandise
under consideration (i.e., contending that the merchandise was
properly classified as blouses).
On March 9, 1994, Customs made its decision on the protest,
completing blocks 13, 14, and 15 of the Customs Form 19. Block
13 was completed by placing an "X" in the box for "Protest" and
an "X" in the block for "Other, namely" under the block for
"Denied in full or in part because". The latter block, and the
block for "Approved" were not checked. After the "X-ed" block
for "Other, namely" the hand written statement "original decision
reviewed and found to be correct" was made. Block 14 was
completed with "S/S" and block 15 was signed with a Customs
official and the date of signature. The Customs Form 19 bears
the usual statement giving the protestant notice of its right to
contest a denial of the protest by bringing a civil action with
the U.S. Court of International Trade within 180 days after the
date of mailing of Notice of Denial.
Subsequently, on April 8, 1994, according to your office, the
protestant filed an "Amended Protest and Application for Further
Review." In this so-called "amended protest", the protestant
made the same arguments as made in the February 3, 1994, protest
regarding the classification of the merchandise. The protestant
also asked for further review, on the basis that "the decision to
demand redelivery is inconsistent with a ruling of the
Commissioner of Customs or his designee" [citing a March 30,
1994, Federal Register notice (59 FR 14808) proposing the
establishment of a conditional release period on entries of
textiles and stating that under 19 CFR 113.62(d) "any demand for
redelivery must be made no later than 30 days after the date that
the merchandise was released ...."]. Thus the February 3, 1994,
protest was purported to be "amended" by requesting further
review and by contending that the Notice to Redeliver was
unauthorized as a matter of law because it was made more than 30
days after the release date.
ISSUE:
May the protest in this case be granted?
LAW AND ANALYSIS:
Protests of Customs decisions (including demands for redelivery
(19 U.S.C. 1514(a)(4))) are authorized by 19 U.S.C. 1514.
Subsection (c) of section 1514 concerns the form, number, and
amendment of protests. Under that provision, "[o]nly one protest
may be filed for each entry of merchandise, except that where the
entry covers merchandise of different categories, a separate
protest may be filed for each category [there are also exceptions
for separate protests filed by different authorized persons and
with respect to certain determinations under the NAFTA
Implementation Act]." Under section 1514(c)(1), "[a] protest may
be amended, under regulations prescribed by the Secretary, to set
forth objections as to a decision or decisions described in
subsection (a) of this section which were not the subject of the
original protest, in the form and manner prescribed for a
protest, any time prior to the expiration of the time in which
such protest could have been filed under this section." Also
under section 1514(c)(1), "[n]ew grounds in support of objections
raised by a valid protest or amendment thereto may be presented
for consideration in connection with the review of such protest
pursuant to [19 U.S.C. 1515] at any time prior to the disposition
of the protest in accordance with that section."
Under 19 U.S.C. 1515(a), in pertinent part:
... the appropriate customs officer ... shall review the
protest and shall allow or deny such protest in whole or in
part. ... Notice of the denial of any protest shall be
mailed in the form and manner prescribed by the Secretary.
Such notice shall include a statement of the reasons for the
denial, as well as a statement informing the protesting
party of his right to file a civil action contesting the
denial of a protest under [19 U.S.C. 1514].
Under 19 U.S.C. 1499(c)(5)(B), as amended by section 613, title
VI, Public Law 103-182 (the Customs Modernization Act) (107 Stat.
2057, 2174):
For purposes of [28 U.S.C. 1581], a protest against the
decision to exclude the merchandise which has not been
allowed or denied in whole or in part before the 30th day
after the day on which the protest was filed shall be
treated as having been denied on such 30th day.
Section 1581 of title 28, United States Code, referred to in the
above-quoted provision, provides for the jurisdiction of the
Court of International Trade. We note that the effective date of
title VI of the Customs Modernization Act is the date of
enactment of Public Law 103-182 (i.e., December 8, 1993, the date
of entry and release of the merchandise under consideration).
Thus, this provision is clearly applicable to the protest under
consideration.
The Customs Regulations pertaining to protests and issued under
the authority of these provisions are found in 19 CFR part 174.
Section 174.14 of the Customs Regulations authorizes the
amendment of protests within the 90-day period for filing a
protest as is done by the statute (see above) and section 174.28
provides for the consideration of additional arguments submitted
prior to the disposition of the protest, also as is done by the
statute (see above). Section 174.30 provides for the notice of
denial of a protest. Under this provision, in pertinent part:
Notice of denial of a protest shall be mailed to any person
filing a protest or his agent .... The notice shall include
a statement of the reasons for the denial, as well as a
statement informing the protesting party of the right to
file a civil action contesting the denial of the protest
.... For purposes of [19 U.S.C. 1515(a)], the date
appearing on such notice shall be deemed the date on which
such notice was mailed.
In regard to the applicability of 19 U.S.C. 1499(c)(5)(B) to the
case under consideration, we note that in United States v.
Toshoku America, Inc., 11 CIT 641, 670 F. Supp. 1006 (1987),
reversed, on grounds not applicable to the quotation below, 7
Fed. Cir. (T) 104, 879 F. 2d 815 (1989), the Court quoted
Congress as stating that:
... a demand for redelivery (or a "constructive seizure"[)]
to Customs custody is in reality no different than a
decision to exclude merchandise from entry or delivery--a
decision which the Customs Court may now review. The only
difference * * * is the time when the decision is made by
the Customs Service. The decision to exclude is made at the
time an entry is attempted. A demand for redelivery is made
after the goods have already entered but the Customs Service
subsequently decides that the goods should not have been
allowed into the commerce of the United States in the first
instance. [(] S. Rep. No. 466, 96th Cong., 1st Sess. 7
(1979).[)] [11 CIT at 644]
As noted above, the effective date of title VI of Public Law 103-
182, including the amendment adding the provision in section
1499(c)(5)(B) was December 8, 1993, the date of entry of the
merchandise under consideration. The protest under consideration
was not allowed or denied in whole or in part before the 30th day
after the day on which the protest was filed (i.e., the date of
filing of the protest was February 3, 1994, and the date of
denial of the protest was March 9, 1994). Therefore, under
section 1499(c)(5)(B), the February 3, 1994, protest was required
to have been treated as denied on the 30th day after the date of
filing (March 5, 1994).
In this case, Customs on March 9, 1994 (i.e., after the date of
"deemed" denial of the February 3, 1994, protest), mailed the
Customs Form 19, completed as described in the FACTS portion of
this ruling. The statutory and regulatory requirements required
to be met for a notice of denial of a protest are mailing of the
notice with a statement of the reasons for denial (in this case,
the statement "original decision reviewed and found to be
correct") and a statement informing the protestant of its right
to file a civil action contesting the denial of the protest
(included on the Customs Form 19). See, in this regard, Labay
International, Inc., v. United States, 83 Cust. Ct. 152, C.D.
4834 (1979), in which the Court stated "Customs unequivocally
conveyed to plaintiff notice that the request in its December 4,
1974 letter for duty-free entry as American goods returned was
denied" when the denial consisted of a hand-written notation
written directly on the document treated as the protest that
"Allen [Labay][:] Steve and I have looked over these documents
and there is not anything we can do about reliquidating". See
also, Wally Packaging, Inc., v. United States, 7 CIT 19, 578 F.
Supp. 1408 (1984); Sea-Land Service, Inc., v. United States, 14
CIT 253, 735 F. Supp. 1059 (1990), affirmed, 923 F. 2d 838 (CAFC
1991). On the basis of the foregoing, we conclude that the March
9, 1994, mailing of the Customs Form 19 for the February 3, 1994,
protest did meet the statutory and regulatory requirements for a
notice of denial of a protest.
In this case, after the date that the February 3, 1994, protest
was denied either under 19 U.S.C. 1499(c)(5)(B) or pursuant to
the March 9, 1994, mailing of the Customs Form 19, as described
above, the protestant filed a so-called "amended protest", on
April 8, 1994. Since the February 3, 1994, protest was already
denied, rather than being an "amended protest", this April 8,
1994, protest was a second protest (i.e., because, with regard to
the first protest, Customs may not rescind the denial of a
protest after it has been mailed; San Francisco Newspaper
Printing Co. v. United States, 9 CIT 517, 620 F. Supp. 738
(1985); see also Webcor Electronics v. United States, 79 Cust.
Ct. 137, 142, C.D. 4725 (1977), in which the Court stated that
"even if the second protest were treated as an amendment of the
first, the [C]ourt would still be required to sever entry No.
K198198 and dismiss this action as to the merchandise covered by
that entry" (because of the one protest per entry rule and
because the same category of merchandise was involved, as is true
in this case, see discussion below)).
Under 19 U.S.C. 1514(c)(1), as quoted above "[o]nly one protest
may be filed for each entry of merchandise, except that where the
entry covers merchandise of different categories, a separate
protest may be filed for each category ...." In the protested
entry, there was only one category of merchandise. The February
3, 1994, protest of the Notice to Redeliver made detailed
arguments as to the classification of the merchandise entered and
the April 8, 1994, "amended protest", also of the Notice to
Redeliver, made the same arguments as to the classification of
the merchandise and also contended that the Notice to Redeliver
was untimely. The Courts have frequently interpreted the
requirement that only one protest is permitted for each entry of
merchandise (see, e.g., F. W. Myers & Co., Inc. v. United States,
6 CIT 299 (1983); Russ Togs, Inc. v. United States, 79 Cust. Ct.
119, C.D. 4722 (1977); Webcor Electronics v. United States,
supra).
In the last two cited cases (Russ Togs and Webcor Electronics),
the Court reviewed the legislative background to this provision.
In the former case (for a similar discussion and conclusion in
the latter case, see 79 Cust. Ct. at 139-141), the Court quoted
from Senate Report No. 91-576, 91st Cong., 1st Sess. (Sen. Comm.
on the Judiciary, 1969) as follows (in part):
There will be a single judicial proceeding in which all
issues, including both appraisement and classification, will
be considered. * * *
There should be a single, continuous procedure for deciding
all issues in any entry of merchandise, including
appraisement and classification issues. [Emphasis added by
Court.] [79 Cust. Ct. at 122]
The Court in Russ Togs concluded that:
In view of the legislative background cited supra, it is
apparent that one of the principal concerns of Congress ...
was to avoid piecemeal administrative processing and
subsequent litigation of different issues pertaining to the
same entry of merchandise ....
To effectuate the Congressional intent in the one protest
per entry rule ... I am clear that only the first protest
received by [C]ustoms for filing may practicably be treated
as valid. The filing of multiple protests challenging
different administrative decisions in a liquidation (viz.,
classification, appraisement, etc.) regarding the same
category of merchandise in a single entry is plainly
inimical to the objective of the statute seeking to
streamline the administrative and judicial review of
[C]ustoms decisions. [79 Cust. Ct. at 122, emphasis in
original.]
In this case, there was only one category of merchandise in the
entry protested. The first protest of the Notice of Redelivery
for that merchandise was denied, either on March 5, 1994, as a
result of the "deemed" denial provision in 19 U.S.C.
1499(c)(5)(B), or on March 9, 1994, as a result of the mailing on
that date of the Customs Form 19 giving the protestant notice of
denial. After denial of the first protest, the protestant
attempted to amend the initial protest, and the "amendment" was
filed within the 90-day period for filing the initial protest.
However, under the above authorities, the "amendment" to the
initial protest must be treated as a second protest and may not
be allowed, for the reasons given above. As the Court stated in
San Francisco Newspaper and as is stated in the notice of denial
of the protest (Customs Form 19), the protestant's proper course
of action was to bring an action contesting the denial of the
protest before the Court of International Trade (or to abandon
the protest; note that the Court in San Francisco Newspaper
stated that these were the only courses of action available to
the plaintiff in that case). The protest is DENIED.
For your information, we are enclosing a copy of our decision in
protest 1001-93-100413 (our file 224712, January 11, 1994),
illustrating our general position on the timeliness of Notices to
Redeliver (i.e., if a Notice to Redeliver is not issued until
more than 30 days after entry and release of the merchandise and
there is no action taken to establish a different conditional
release period, a timely protest against the Notice to Redeliver
should be granted). As the protestant noted in its April 8,
1994, protest, the position taken in the January 11, 1994,
protest is under reconsideration and may be changed, pursuant to
the March 30, 1994, Federal Register notice cited above.
HOLDING:
The protest is DENIED. The initial protest was denied on March
5, 1994, as a result of the "deemed" denial provision in 19
U.S.C. 1499(c)(5)(B), or on March 9, 1994, as a result of the
mailing on that date of the Customs Form 19 giving the protestant
notice of denial. Therefore April 8, 1994, "amended" protest is
actually a second protest which must be denied because only one
protest is permitted for each entry of merchandise, unless one of
the exceptions provided is applicable.
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, Freedom of Information Act, and other
public access channels.
Sincerely,
John Durant, Director
Commercial Rulings Division
Enclosure