LIQ-4-01; LIQ-11
RR:CR:DR 229330 IDL
Port Director of Customs
Attn: Gail Douglas
40 S. Gay St.
Room No. 205
Baltimore, MD 21202
Re: Protest No. 1303-01-100081; 19 U.S.C. 1514; 19 U.S.C. 1504(d); Antidumping Duties
Dear Ms. Douglas:
This is in response to your correspondence dated October 4, 2001, concerning Travelers Casualty and Surety Company, Protest No. 1303-01-100081.
FACTS:
Travelers Casualty and Surety Company (“Travelers”) protests liquidation of two entries of bicycle speedometers manufactured by Asahi Keiki Mfg. Co./Yagam Corporation of Japan (“Asahi/Yagam”), Entry No. 81-xxxx325, entered on June 1, 1981, and Entry No. 81-xxxx743, entered on April 15, 1981. Customs suspended the subject entries, pending an antidumping administrative review by the Department of Commerce (“Commerce”), covering eleven manufacturers and/or exporters of Japanese bicycle speedometers to the United States during the period of April 1, 1978 through October 31, 1984.
On July 31, 1987, Commerce published on Case A-588-038 (52 FR 28582), Preliminary Results of Antidumping Duty Administrative Review, Bicycle Speedometers From Japan. Commerce preliminarily determined the weighted-average dumping margin for Asahi/Yagam to be 6.15% on merchandise entered between April 1, 1980 and October 31, 1981. On November 4, 1987, Commerce published on Case A-588-038 (52 FR 42329), Bicycle Speedometers from Japan; Final Results of Antidumping Duty Administrative Review (“Final Results”), again finding a dumping margin of 6.15% for the applicable period.
On July 13, 2000, Commerce released via Message No. 0195201, liquidation instructions to Customs for Bicycle Speedometers from Japan Manufactured and Exported by Asahi Keiki Mfg. Co./Yagam Corporation (A-588-038-031), 6.15% antidumping liability, covering the period of November 1, 1978 through October 31, 1981. On August 25, 2000, Customs liquidated both entries. On November 7, 2000, Customs mailed a formal demand on surety to Travelers. The demand included the corresponding bill numbers, importer number, billing location, document dates, entry numbers, bill date, and amount due. On December 13, 2000, Travelers filed Protest No. 1303-01-100081.
Travelers argues that Customs failed to liquidate the subject entries until thirteen years after Commerce published the Final Results; that the entries liquidated by operation of law under 19 U.S.C. 1504(d); in the alternative, that such delay “constitutes an abuse of discretion” by the “Government” and prejudice to the surety that merits remedy; that Customs has failed to provide the surety with evidence of the basis of its indebtedness; that the doctrine of “laches” precludes Customs from collecting duties.
ISSUES:
(1) Whether Customs’ liquidation of the subject entries on August 25, 2000 was barred by a prior liquidation by operation of law under 19 U.S.C. 1504(d)?
(2) Whether Commerce’s delay in releasing liquidation instructions to Customs is protestable under 19 U.S.C. 1514?
(3) Whether Customs has provided the surety with evidence of the basis of its indebtedness?
(4) Whether the doctrine of “laches” precludes Customs from collecting duties?
LAW AND ANALYSIS:
Initially, we note that the protest was timely filed under the statutory and regulatory provisions for protests (see 19 U.S.C. § 1514(c)(3)). The date of mailing of Notice of Demand for Payment to the surety was November 7, 2000, and Travelers filed protest on December 13, 2000, well within the 90-day statutory time requirement under § 1514(c)(3). Although the facts presented and issues raised involve questions of law or fact which have been addressed by ORR, we will again address the issues. (see 19 CFR Part 174).
Issue (1)
Whether Customs’ liquidation of the subject entries on August 25, 2000 was barred by a prior liquidation by operation of law under 19 U.S.C. 1504(d)?
Generally, antidumping duty instructions applied by Customs are not protestable. Fujitsu Ten Corp. v. United States, Ct. Int’l Trade, Slip Op. 97-11 (January 29, 1997). The role of Customs in the antidumping process is “simply to follow Commerce’s instructions in collecting deposits of estimated duties and in assessing antidumping duties…at the time of liquidation.” HQ 228611; HQ 225382; see also, Mitsubishi Electronics America, Inc. v. United States, 44 F. 3d 973 (Fed. Cir. 1994); Nichimen America, Inc. v. United States, 938 F. 2d 1286 (1991). However, an importer may protest Customs’ failure to follow a Commerce instruction under 19 U.S.C. 1514. American Hi-Fi International, Inc. v. United States, 19 C.I.T. 1340 (1995).
Headquarters has issued numerous administrative decisions, proposing that the date for lifting of the liquidation suspension is the date Customs receives instructions from Commerce to liquidate the subject entries. See HQ 228660, April 6, 2001; HQ 225783, January 16, 1996; HQ 226285, October 10, 1997; HQ 227793, November 4, 1998; and HQ 227562, March 3, 1999. However, see also, International Trading Co. v. United States, 110 F. Supp. 2d 977; Slip Op. 00-83 (July 14, 2000), appeal pending, which interpreted 19 U.S.C. 1504(d). In that case, the court held that the direct communication from Commerce to Customs in a form releasable to the public, that the suspension of liquidation for the subject entries was removed following the previous publication of final results in the Federal Register was sufficient notice under section 1504(d) (1993) for the 6-month liquidation period to run. That communication from Commerce did not contain liquidation instructions to Customs to liquidate the subject entries, such instructions followed later.
In this case, Commerce sent Customs liquidation instructions on Case A-588-038 on July 13, 2000. The following month, on August 25, 2000, Customs lifted the suspension of liquidation on the subject entries. Therefore, the entries at issue were not deemed liquidated pursuant to section 1504(d), as they were properly liquidated within six months of Commerce’s releasing of liquidation instructions to Customs.
Issue (2)
Whether Commerce’s delay in releasing liquidation instructions to Customs is protestable under 19 U.S.C. 1514?
Customs has the authority to grant or deny protestable decisions. According to 19 U.S.C. 1514(a), these include, "decisions of the Customs Service, including the legality of all orders and findings entering into the same, as to . . . (5) the liquidation or reliquidation of an entry, or reconciliation as to the issues contained therein, or any modification thereof." Concerning the role of Customs in liquidating antidumping duties the court stated in Mitsubishi Electronics, supra, at page 977:
…Customs has a merely ministerial role in liquidating antidumping duties under 19 U.S.C. 1514(a)(5). Customs cannot "modify . . . [Commerce's] determinations, their underlying facts, or their enforcement." Royal Business Machs., Inc. v. United States, 507 F.Supp. 1007, 1014 n.18 (Ct. Int'l Trade 1980), aff'd, 669 F.2d 692 (CCPA 1982).
On July 13, 2000, Commerce ordered Customs to lift suspension of liquidation of entries via Message No. 0195201. The following month, on August 25, 2000, Customs liquidated the entries, well within the six-month statutory requirement of section 1504(d).
Therefore, since Customs properly administered liquidation of the two entries, this issue is not a protestable Customs matter under section 1514.
Issue (3)
Whether Customs has provided the surety with evidence of the basis of its indebtedness?
Counsel argues that in Old Republic Insurance Co. v. U.S., 10 C.I.T. 1; 625 F.Supp. 983 (1986), the court held that Customs is under an obligation to provide some evidence of a surety’s indebtedness on a particular bond. Actually, the court was addressing notice to the surety, which would enable it to file protest within the 90-day statutory limitation of section 1514(c)(3). In this case, there is no dispute that protestant has timely filed protest under section 1514(c)(3). The issue concerns sufficiency of information provided by Customs enabling surety to identify and access records pertaining to the bond.
Customs has provided Travelers with bill numbers, importer number, billing location, document dates, entry numbers, port of entry, bill date, and amount due. [N]otice to a surety for payment is not rendered insufficient merely because the record-keeping practices of the surety are inadequate. See Magee v. Manhattan Life Ins. Co., 92 U.S. 93, 98 (1875) (a surety "must not rest supine, close his eyes, and fail to seek important information within his reach").
Customs is not required to attach a copy of the bond to its demand for payment when Customs provides sufficient information for the surety to locate the bond and ascertain its liability for payment. In the view of the Court, any difficulties facing a surety in securing copies of its import bonds or identifying its own agents can be overcome by requiring that each broker or agent submit a copy of the bond to the surety upon execution with the importer or filing with Customs. A prudent surety would thus have a copy of all bonds under which it may be liable, which could be examined immediately upon receiving a demand for payment…. Peerless Insurance Co. v. United States, 12 C.I.T. 1231; 703 F. Supp. 104; 1988 Ct. Intl. Trade LEXIS 373; SLIP OP. 88-177 (December 30, 1988), aff'd, 891 F.2d 298 (Fed. Cir. 1989).
It remains the surety’s obligation to maintain records of its bonds, particularly those that are unliquidated or only recently liquidated. Unlike Old Republic, Customs has provided adequate information in this case that would allow the surety to identify and access records pertaining to the bond.
The information provided by Customs is sufficient evidence of surety’s indebtedness.
Issue (4)
Whether the doctrine of “laches” precludes Customs from collecting duties?
Protestant contends that relief should be granted on the basis of laches. The legal doctrine of laches precludes enforcement of a legal right or claim if a long delay in asserting the right or claim has prejudiced the adverse party. We note that laches is an equitable doctrine (see, e.g., A.C. Aukerman Co. v. R.L. Chaides Const. Co., 960 F. 2d 1020, 1030-1031 (Fed. Cir. 1992); Robins Island Preservation Fund v. Southold Dev., 959 F. 2d 409, 423-424 (2nd Cir. 1992)). Equitable principles do not operate against the Government in cases involving the collection or refund of duties on imports (Air-Sea Brokers, Inc. v. United States, 66 CCPA 64, 67-68, C.A.D. 1222, 596 F. 2d 1008 (1979); see also Mitsubishi Electronics America, Inc. v. United States, CIT Slip Op. 94-155, printed in the October 26, 1994, Customs Bulletin and Decisions, Vol. 28, No. 43, p. 69). Since this is a case involving the collection or refund of duties on imports, the doctrine of laches is not available in this case. HQ 224650.
Furthermore, any prejudice to the protestant would not have resulted from a Customs decision, and, thus, would not be protestable under section 1514 (see discussion in Issue (2)).
HOLDING:
The protest should be DENIED as to Issues (1), (2), (3), and (4) for the reasons mentioned above. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you are to mail this decision, together with the Customs Form 19, to the Protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.
Sixty days from the date of the decision, the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.ustreas.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
John Durant
Director,
Commercial Rulings Division