LIQ-4-02/PRO-2-02-CO:R:C:E 223139 JR
Regional Director of Customs
Commercial Operations, Pacific Region
One World Trade Center, Suite 534
Long Beach, California 90831-0700
RE: Application for further review of Protest No. 2904-91-
000038, dated March 8, 1991; Countervailing duties; entries
liquidated during outstanding injunction of CIT suspending
its liquidation; voidable liquidation; 19 U.S.C. 1514(a)(5).
Dear Sir:
The above-referenced protest was forwarded to our office for
further review from the District Director, Portland, Oregon.
FACTS:
The protest involves the liquidation of an entry covering
imported cast iron man-hole covers, frames and grates exported
from India on May 31, 1985. On December 10, 1990, the
International Trade Administration (ITA), U. S. Department of
Commerce, published the final results of its 1985 administrative
review of the countervailing duty order on certain Iron Metal
Castings from India in the Federal Register (55 FR 50,747). On
instructions from the ITA, Customs Headquarter's, Office of Trade
Operations, issued an E-mail telex no. 1347113 on December 13,
1990, instructing the field offices to assess countervailing
duties at the various listed percentages on all shipments of this
merchandise exported on or after January 1, 1985 and on or before
December 31, 1985.
On December 20, 1990, the Portland district office forwarded
the entry in question for liquidation. Subsequently, but before
the entry was liquidated, the U.S. importer of record filed a
summons and complaint in the U.S. Court of International Trade
(CIT) to contest the final results of the 1985 administrative
review. The CIT issued an injunction on January 23, 1991,
suspending the liquidation of the 1985 imports of iron metal
castings during the pendency of the litigation. Despite the
outstanding injunction, Customs liquidated the entry in this
protest on February 1, 1991. The importer asserts that since the
entry was improperly liquidated, the liquidation should be
cancelled, and pursuant to the court order, liquidation should be
suspended until resolution of the court action.
ISSUE:
May Customs "unliquidate" an entry which has been liquidated
in contravention of a court injunction suspending its
liquidation?
LAW AND ANALYSIS:
The United States Court of Appeals for the Federal Circuit
has held, without commenting on the correctness of the Customs
Service's action, that Customs may not "unliquidate" a premature
liquidation. See United States v. Utex International Inc., 6
Fed. Cir. (T) 166; 857 F.2d 1408 (1988).
Customs has recently followed the Utex case. In HQ 221591,
dated February 13, 1990, an entry was improperly liquidated on
the basis of the preliminary antidumping duty investigation and
the importer timely protested. Customs held that because it
could not determine the final amount of antidumping duties to be
paid as the final antidumping duty order had not yet been issued,
Customs could not correctly liquidate the entry; therefore,
considering the options permitted under 19 U.S.C. 1514/1515, if
Customs acted on the protest for further review at that time, it
would have to deny the protest. However, Customs provided the
protestant with the opportunity to request, in writing, that
Customs withhold action on the protest until the final results of
the antidumping duty order was published. Otherwise, if Customs
denied the protest, the only course of action remaining for the
protestant would be to bring suit in the Court of International
Trade and seek equitable relief.
In this case, the protestant has timely filed a protest
under 19 U.S.C. 1514 against the liquidation of the entry and
exaction of countervailing duties at the 9.06 percentage rate
plus interest in contravention of an outstanding court
injunction. Although the liquidation of the entry was improper
when a valid court order restraining liquidation was pending,
Customs cannot cancel the liquidation as the protestant requests.
The liquidation, although voidable, is still binding unless
Customs can correctly reliquidate, which it cannot presently do.
See generally United States v. A.N. Deringer, Inc., 66 CCPA 50,
CAD 1220, 593 F.2d 1015 (1979). Since Customs can neither cancel
the liquidation of the entry nor reliquidate the entry while the
countervailing duty findings are under review in the Court of
International Trade, we have no choice but to deny this protest
if we act now.
HOLDING:
Customs may not "unliquidate" an entry which has been
liquidated in contravention of a court injunction suspending its
liquidation (despite the timely filed protest) since the entry
cannot be correctly reliquidated while the countervailing duty
order is under review in the Court of International Trade.
Accordingly, you are instructed to inform the protestant
that Customs is willing to withhold action on the protest, if the
protestant so requests in writing, until the court renders its
decision. Absent such a written request to withhold action, you
are instructed to deny this protest for the above-stated reasons.
Please inform the protestant of his options. You may issue a
copy of this decision to the protestant.
Sincerely,
John A. Durant, Director