PRO 2-05
H293759 SMS
OT:RR:CTF:ER
Port Director
U.S. Customs and Border Protection
Port of Los Angeles/Long Beach
301 E. Ocean Blvd.
Long Beach, CA 90802
Attn: Bret Ewing, Supervisory Import Specialist
RE: Application for Further Review of Protest Number 2720-16-100930 Concerning Crystalline Silicon Photovoltaic Cells under Antidumping Order A-570-979 and Countervailing Order C-570-980
Dear Port Director:
The following is our decision regarding the Application for Further Review (“AFR”) of Protest Number 2720-16-100930, filed by NBO Group Inc., (“NBO”) on June 8, 2016, which contests the antidumping rate assessed on its entries of Crystalline Silicon Photovoltaic Cells (“solar cells”).
FACTS:
Between January 15, 2013 and November 19, 2013, NBO, made five entries of solar cells from the People’s Republic of China (“China” or “PRC”), which were subject to antidumping order A-570-979 and countervailing duty order C-570-980. See Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From the People’s Republic of China: Amended Final Determination of Sales at Less Than Fair Value, and Antidumping Duty Order, 77 Fed. Reg. 73,018 (Dec. 7, 2012) (“AD Order”); and Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From the People’s Republic of China: Countervailing Duty Order, 77 Fed. Reg. 73,017 (Dec. 7, 2012) (“CVD Order”). The entry documents for the five entries list Ningbo ETDZ Holdings, Ltd. (“ETDZ”) as the exporter of the solar cells and Hangzhou Zhejiang University Sunny Energy Science and Technology Co., Ltd. (“Hangzhou Sunny”) as the manufacturer. The following five entries are subject to the instant protest:
Date of Entry
Entry Number
Exporter
01/15/2013
xxx-xxxx9404
ETDZ
05/14/2013
xxx-xxxx7701
ETDZ
06/29/2013
xxx-xxxx0406
ETDZ
08/19/2013
xxx-xxxx0303
ETDZ
11/19/2013
xxx-xxxx4902
ETDZ
On July 14, 2015, the Department of Commerce (“Commerce”) published the final results for certain respondents for the antidumping order and period at issue. See Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From the People’s Republic of China: Final Results of Antidumping Duty Administrative Review and Final Determination of No Shipments; 2012–2013, 80 Fed. Reg. 40,998 (July 14, 2015). In the final results, Commerce determined that ETDZ, along with other listed exporters, no longer were eligible for a separate rate and were considered part of the PRC wide entity. Id. On August 7, 2015, Commerce issued a public message to U.S. Customs and Border Protection (“CBP”) instructing CBP to liquidate entries of solar cells exported by ETDZ, among others, and entered, or withdrawn from warehouse, for consumption during the period of May 25, 2012, through November 30, 2013, and to assess an antidumping liability equal to PRC-wide entity rate of 238.95 percent. See Message No. 5219317 (Aug. 7, 2015). We note that Commerce also instructed CBP to liquidate entries of solar cells exported by Hangzhou Sunny and assess an antidumping liability equal to 9.67 percent of the entered value of subject merchandise. See Message No. 5219314 (Aug. 7, 2015).
On February 20, 2015, Commerce issued automatic liquidation instructions for solar cells from the PRC for the period of January 1, 2013 through December 31, 2013, under countervailing duty order, C-570-980, except for certain listed firms, including ETDZ, which remained under administrative review. See Message No. 5051320 (Feb. 20, 2015). We note that Hangzhou Sunny was not listed as a firm excepted from automatic liquidation. Subsequently, on January 8, 2016, Commerce published a partial recession of CVD administrative review for firms, which included ETDZ, as these firms withdrew their requests for administrative review. See Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled Into Modules, From the People’s Republic of China: Preliminary Results of Countervailing Duty Administrative Review; 2013; and Partial Rescission of Countervailing Duty Administrative Review 81 Fed. Reg. 908 (Jan. 8, 2016). Consequently, Commerce issued a public notice lifting the suspension of liquidation on February 1, 2016, and instructed CBP to assess countervailing duties on solar cells entered, or withdrawn from warehouse, for consumption during the period of January 1, 2013 through December 31, 2013, at the cash deposit or bonding rate required at the time of entry. See Message No. 6032314 (Feb. 1, 2016). In this Message, ETDZ, was assigned case number C-570-980-057. Id.
On December 18, 2015 and December 28, 2015, CBP liquidated the above listed five entries at the antidumping and countervailing duty rates pertaining to exporter ETDZ. NBO protested the liquidation of its entries on June 8, 2016. NBO asserts that while the entry documentation for the five entries identified the shipper information as ETDZ, the actual Chinese company, which sold the subject merchandise from China to NBO and set the export price, was Hangzhou Sunny. NBO contends that the entry documentation demonstrates that Hangzhou Sunny is the manufacturer of the subject solar cells. NBO explains that it negotiated export prices with the Chinese factory, Hangzhou Sunny, and merely arranged with ETDZ to consolidate its purchased merchandise with other merchandise to fill a container load and to prepare the export documents. Accordingly, NBO now protests the liquidation of the entries at the AD/CVD rates assigned exporter ETDZ, contending that because it identified ETDZ as the applicable exporter “as a result of mistake of fact . . . a protest is the proper recourse to correct the entries” pursuant to 19 C.F.R. §174.11. Additionally, NBO argues liquidation was premature, as CBP was enjoined from liquidating entries of solar cells exported by Hangzhou Sunny during the May 25, 2012 to November 30, 2013 period, and CVD liquidation instructions were not yet issued. The Port contends that as the entry documentation and commercial invoices list ETDZ as the exporter, it did not err in its liquidation of the five entries.
In support of its argument, NBO attached an affidavit written by its president, asserting the export prices of the solar cells were negotiated by himself and Hangzhou Sunny. After which, Hangzhou Sunny shipped the products to ETDZ, who consolidated the purchases and exported them to the United States. The president explains, that for compensation, ETDZ was paid on a flat fee basis, plus interest. Affidavits from the Sales Manager of Hangzhou Sunny were also submitted, which supported the President’s statements. Hangzhou Sunny stated that even though the purchase contract is between itself and ETDZ, it was done through the instructions of NBO. Additionally, ETDZ submitted affidavits in support of NBO’s position, and indicated it was paid a flat fee as well as, a 5% commission was “mistakenly applied in the subject solar cell panel product transactions.” ETDZ indicated that it made payments to Hangzhou Sunny and then prepared sales contracts, commercial invoices, packing lists and export documentations for NBO. The commercial invoices, packing lists, and bill of ladings all list ETDZ as the exporter of the merchandise. Included with the protest are payment receipts from NBO to EDTZ; sales contracts between ETDZ and NBO, listing ETDZ as the seller of the solar cells; sales contracts between ETDZ and Hangzhou Sunny, listing ETDZ as the purchaser; bank statements, and several messages in Chinese, which we ignored.
ISSUE:
Whether CBP properly liquidated NBO’s five entries of solar cells.
LAW AND ANALYSIS:
As an initial matter, we note that the protest was timely filed on June 8, 2016, within 180 days of liquidation of the entries on December 18, 2015 and December 28, 2015, under the statutory provisions for protests. See 19 U.S.C. § 1514(c)(3). Generally, assessed antidumping and countervailing duties properly applied by CBP are not protestable. It is well settled that when assessing and collecting AD/CVD duties, CBP follows Commerce’s instructions. “Customs has a merely ministerial role in liquidating antidumping duties.” Mitsubishi Electronics America, Inc. v. United States, 44 F.3d 973, 977 (Fed. Cir. 1994). The courts have consistently held that CBP’s role in the antidumping process is simply to follow Commerce’s instructions in collecting deposits of estimated duties and in assessing antidumping duties, together with interest, at the time of liquidation. See Fujitsu Ten Corporation of America v. United States, 21 C.I.T. 104, 107 (1997); and American Hi-Fi International, Inc. v United States, 19 C.I.T. 1340, 1342-43 (1995). Thus, CBP simply applies the antidumping and countervailing duty rates determined by Commerce, to entries of merchandise in accordance with Commerce’s liquidation instructions. Accordingly, CBP must follow Commerce’s instructions with regard to the entries of solar cells from China at issue in this case. Inasmuch as NBO protests the timing of the liquidation, i.e., disputes the application by CBP of Commerce’s liquidation instructions, this matter is protestable. See Xerox Corp. v. United States, 289 F.3d 792 (Fed. Cir. 2002); see also, HQ 221591 (Feb. 13, 1990) (a mistake in the liquidation process can be corrected by one of the statutory methods set forth in 19 U.S.C. § 1514).
Pursuant to 19 C.F.R. § 159.1, liquidation “means the final computation or ascertainment of the duties . . . accruing on an entry.” 19 C.F.R. § 159.1. This definition of liquidation was affirmed in Swisher International, Inc., v. U.S., 27 F. Supp. 2d. 234 (Ct. Int’l Trade 1998), rev’d on other grounds, 205 F.3d 1358 (Fed. Cir. 2000), reh’g en banc denied, LEXIS 12707 (Fed. Cir. May 22, 2000). The court found that it “is a liquidation which settles ‘the amount of duties owing.’” Id. at 237. The Court of International Trade (“CIT”) has held that the most important part of the United States’ “retrospective” duty assessment system, under which final liability for antidumping and countervailing duties is determined, is the statutorily implied suspension of liquidation contained in 19 U.S.C. § 1675 (a)(2). See SSAB N. Am. Div. v United States Bureau of Customs & Border Prot., 571 F Supp. 2d 1347, 1350-51 (Ct. Int’l Trade 2008). The suspension of liquidation enables Commerce to calculate the assessment of rates for the subject entries, which are then applied by CBP, pursuant to liquidation instructions received from Commerce after publication of the final results of their administrative review. Id. Thus, CBP cannot determine a final amount of the duties for an entry subject to AD or CVD until Commerce issues instructions for all the duties applicable to the entry. Therefore, liquidation of the protested entries was suspended as long as the liquidation remained suspended for at least one line item of goods on the entry. See HQ H017002 (Oct. 31, 2011).
While, CBP received liquidation instructions on August 7, 2015, directing it to liquidate all entries for both ETDZ and Hangzhou Sunny, of solar cells from China and asses antidumping duties, it could not liquidate the entries because they were also subject to a countervailing duty order for which suspension of liquidation had not yet lifted. Liquidation may be suspended as required by statute or court order, and a countervailing duty order of suspension is grounds for statutory suspension under 19 U.S.C. § 1504. CBP did not receive the instructions lifting the suspension of the remaining countervailing duty order at issue until February 1, 2016. Thus, CBP could not have liquidated the entries until that date. Accordingly, CBP erroneously liquidated the entries on December 18, 2015, and December 28, 2015, under Message No. 5219317, dated August 7, 2015, prior to the issuance of Message No. 6032314, dated February 1, 2016. CBP’s premature liquidation of the entries of solar cells in violation of suspension of liquidation contained in 19 U.S.C. § 1675(a)(2) was unlawful, as it rendered Commerce’s administrative review and any subsequent judicial review meaningless exercise for the subject entry. See SSAB N. Am. Div., 571 F Supp. 2d at 1352. See HQ H265169 (May 23, 2019).
While CBP liquidated the entries at issue before the countervailing liquidation instructions were issued on February 1, 2016, CBP may grant relief under the final duty determination via reliquidation pursuant to 19 U.S.C. § 1514. See United States v. Utex International, Inc., 857 F.2d 1408 (Fed. Cir. 1988); HQ 230074 (March 9, 2004); see also, HQ 221591 (Feb. 13, 1990) (cancellation of a liquidation is not a viable option under Customs laws and regulations). However, NBO asserts that the duty rate should be that assigned to Hangzhou Sunny and not that of ETDZ. DOC Message 5219317, instructed CBP to liquidate entries of solar cells “exported by” ETDZ, among others, and entered, or withdrawn from warehouse, for consumption during the pertinent period, and to assess an antidumping liability equal to PRC-wide entity rate of 238.95 percent. See Message No. 5219317 (Aug. 7, 2015).
In its protest, NBO concedes, “that the export documents show that EDTZ is the Chinese Exporter.” NBO submitted over 200 pages of documents including: commercial invoices, packing lists, and bills of lading all of which list ETDZ as the exporter of the merchandise. Also included in its submission are payment receipts from NBO to EDTZ; sales contracts between ETDZ and NBO, listing ETDZ as the seller of the solar cells; sales contracts between ETDZ and Hangzhou Sunny, listing ETDZ as the purchaser; bank statements, and several illegible messages in Chinese. Despite the affidavits submitted, these documents all reflect that ETDZ bought the solar cells from Hangzhou Sunny and sold them to NBO. These documents do not demonstrate, as NBO contends, that ETDZ was merely a shipper/consolidator of merchandise, but an active participant in the sales transactions of the solar cells, receiving payment and a commission for its sales transactions. Moreover, ETDZ did facilitate the shipments of the solar cells to the United States, from China, after it made the purchase from Hangzhou Sunny. ETDZ was the entity that had the power and responsibility for sending the goods out of China, which was properly reflected on the entry and commercial documents. Accordingly, we find that the Port did not err in assessing the five entries the PRC-wide entity rate because the shipments were exported by ETDZ.
NBO contends that while EDTZ is the Chinese exporter, it was merely the freight consolidator, and that because Hangzhou Sunny set the export price, it should be considered the exporter for AD/CVD purposes. NBO cites Apex Exports et al. v. United States, 777 F.3d 1373, 1374 (Fed. Cir. 2015) to argue that because Commerce calculates antidumping duty using the export price methodology, it is imperative that Commerce first determine which entity is setting such price. Additionally, NBO cites, Sulfanilic Acid From the People's Republic of China; Final Results and Final Partial Rescission of Antidumping Duty Administrative Review, 67 Fed. Reg. 1962 (Jan. 15, 2002) to contend that shipping agents not involved in the sales of products are not administratively reviewed as parties of interest by Commerce.
NBO requests that CBP evaluate the evidence and hold that it should be afforded a specific rate, based on alleged in-country contracts, contrary to entry documentation. However, this is a determination, as asserted by NBO, that is made by Commerce. An administrative review may be requested by an interested party, an exporter or producer covered by the antidumping order, or an importer of the subject merchandise. See 19 C.F.R. § 351.213(b)(1)-(3). Thus, it is a matter for Commerce, not CBP, to determine which party is the appropriate exporter to be assessed a specific rate, after analyzing a specific transaction. CBP’s ministerial role is to follow the liquidation instructions and to compute the duty by applying the antidumping and countervailing duty rate set by Commerce. Here Commerce’s instructions indicated that the pertinent rate should be assessed on the exporter, not that of the manufacturer. Therefore, based on the commercial and entry documents and in accordance with Commerce’s instructions, NOB’s five entries of solar cells, exported by ETDZ, an entity without a separate rate, were properly liquidated at the PRC-wide entity rate. While, CBP erroneously liquidated the entries prior to the issuance of Message No. 6032314, we note that at the time of entry the entries were assessed the appropriate countervailing deposit rate as directed by Message Number 6032314.
HOLDING:
Consistent with the decision set forth above, we find that the five entries imported by NBO and exported by ETDZ are properly assessed the PRC-wide entity. While the five entries were liquidated prior to the receipt of liquidation instructions from Commerce for both the antidumping and countervailing duty, the entries were assessed the appropriate countervailing deposit rate as directed by Message Number 6032314, dated February 1, 2016, and the appropriate antidumping rate contained in Message Number 5219317, dated August 7, 2015. The Protest is DENIED in full.
Sixty days from the date of the decision, the Office of Trade, Regulations and Rulings will make the decision available to CBP personnel, and to the public on the Customs Rulings Online Search System (CROSS) at https://rulings.cbp.gov/ which can be found on the U.S. Customs and Border Protection website at http://www.cbp.gov and other methods of public distribution.
Sincerely,
Craig T. Clark, Director
Commercial and Trade Facilitation Division