CLA-2 CO:R:C:V 544033 VLB
Area Director of Customs
U.S. Customs Service
6 World Trade Center
New York, NY 10048-0945
RE: Decision on Application for Further Review of Protest
No. 1001-5-013012
Dear Sir:
This application for further review was filed against your
decision to reliquidate entries made by the importer. The
merchandise was appraised pursuant to section 402(b) of the
Tariff Act of 1930, as amended by the Trade Agreements Act of
1979 (19 U.S.C. 1401a; TAA).
The merchandise in question is ladies cotton wearing apparel
that is imported from India. The limited information submitted
in this case indicates that the merchandise was manufactured by
Company A in Bombay, India. Company B, also located in Bombay,
India, issued the invoices for the merchandise. The importer has
informed Customs that there is no relationship between the
importer and the manufacturer. However, there appears to be a
relationship between the importer and Company B.
The entries at issue were liquidated in April, 1985, and
were reliquidated in July, 1985. The importer protests the
"reliquidation, reassessment and reappraisement" of the
merchandise. The importer states the following:
These entries reliquidated (sic) at nearly three times the
entered value due to the importer's alleged failure to
respond to a Request for Information. This appraisement is
arbitrary and not in accordance with any of the statutorily
prescribed methods of appraisement. Pursuant to Ashland
Chemical Co. v. United States, Slip Op. 84-71 (1984) (copy
attached), this appraisement is unreasonable, contrary to
law and thus clearly erroneous.
In addition, the importer contends that the invoice price
represented the price actually paid or payable for the finished
merchandise exclusive of buying commissions and third party quota
charges. The importer did not submit any information to support
its position.
- 2 -
It is well settled that the burden is placed upon the
importer to prove the existence of a bona fide agency
relationship and that the amounts paid to the agent were, in
fact, bona fide buying commissions. B & W Wholesale Co. v.
United States, 58 CCPA 92, C.A.D. 1010, 436 F.2d 1399 (1971); New
Trends, Inc. v. United States, 10 CIT ____, 645 F. Supp. 957
(1986). The failure to produce documentary evidence of a
transaction, which is normally reduced to writing and would be
indicative of agency status weakens the probative value. A & A
Trading Corp. v. United States, 65 Cust. Ct. 685, A.R.D. 276
(1970).
In this case, the importer has failed to submit any evidence
that would support its contention that it had a buying agency
relationship with an Indian company or individual. Therefore,
Customs cannot provide the requested relief for the alleged
buying commissions. See, C.S.D. 88-19, 22 Cust. Bull. 844
(1988).
In addition, under the current rules, when an importer makes
quota payments to an unrelated third party, the payments are not
dutiable. C.S.D. 81-86, 15 Cust. Bull. 908 (1981). However, the
importer in this case has failed to provide any information that
shows the relationship between the parties, or the circumstances
surrounding the alleged quota purchase. Consequently, Customs is
unable to ascertain that these payments were made to a person
other that the seller of the merchandise.
In sum, the importer has failed to submit any documentation
or explanation supporting its claim. Therefore, you are directed
to deny the protest. A copy of this decision should be attached
to Form 19, Notice of Action, to be sent to the protestant.
Sincerely,
John Durant, Director
Commercial Rulings Division
1 cc CO:R:C:V:VLB:LDC:11/22/88
Area Director of Customs
U. S. Customs Service
6 World Trade Center
New York, NY 1004-0945