Customs Ruling HQ H328752 - Application for Further Review of Protest No. 4909-21-100585; Section 201 Duties; Section 301 Duties; Antidumping Duties; Countervailing Duties; Solar Modules

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HQ H328752
Mar 01, 2024

Type : Entry • HTSUS :
Related: 230074; 221591; H304677; H301813; H265169; H293759

OT:RR:CTF:EPDR H328752 JW

Center Director
Electronics Center of Excellence and Expertise
U.S. Customs and Border Protection
301 East Ocean Blvd.
Long Beach, CA 90802

Attn: Omar De Jesus, Import Specialist

Re: Application for Further Review of Protest No. 4909-21-100585; Section 201 Duties; Section 301 Duties; Antidumping Duties; Countervailing Duties; Solar Modules

Dear Center Director:

This letter is in response to the Application of Further Review ("AFR") of Protest No. 4909-21-100585, filed on November 23, 2021,[1] by Astronergy Solar ("Astronergy" or "Protestant"). Astronergy is protesting "U.S. Customs and Border Protection's [ ] liquidation, appraisement and assessment of antidumping duty [ ], countervailing duty [ ], Section 201 Safeguard duty, and Section 301 duty" on an entry of solar modules[2] that Astronergy claims are of Cambodian origin. This protest was designated as the lead protest by Protestant, who claims that "Protest no. 2809-21-108798 concerns the same merchandise and has been suspended[.]"

FACTS:

This AFR arises from a May 4, 2019 consumption entry of "solar panels" (as described on the commercial invoice) shipped from Enalex Energy (KH) Co., Ltd., located in Cambodia, and that Astronergy entered as the importer of record. Astronergy claims the solar panels are of Cambodian origin but were wrongly liquidated as Chinese origin products and, on this basis, assessed Section 201 duties, Section 301 duties, antidumping duties ("ADD") and countervailing duties ("CVD") (collectively, "Additional Duties").

On December 7, 2012, the Department of Commerce ("Commerce") issued the ADD order in case A-570-979 and the CVD order in case C-570-980 on certain crystalline silicon photovoltaic cells, whether or not assembled into modules, from China. 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); 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). Further, on June 15, 2021 in response to a scope inquiry from another entity, Commerce issued a scope ruling, which noted, inter alia, that "the presence of a p/n junction is the factor which ultimately separates a non-subject solar wafer from a subject solar cell[.]" Final Scope Ruling on the Antidumping and Countervailing Duty Orders on Crystalline Silicon Photovoltaic Cells from the People's Republic of China: ET Solar Inc., June 15, 2021, Commerce barcode 4133803-01.

Prior to the assessment of these Additional Duties, U.S. Customs and Border Protection ("CBP") issued a Request for Information to Protestant asking for documentation to substantiate the product origin. However, as noted in CBP's Notice of Action (dated January 16, 2020), Astronergy "failed to respond to the CF28 Document Request for Information issued on 08/03/2019 and a CF29 Proposed Rate Advancement issued 10/04/19[.]" As a result, CBP found that the solar panels were subject to ADD and CVD, along with "Section 201 trade remedies for solar panels and Section 301 duties for articles from China[.]"

On March 2, 2020, Commerce noted to CBP in Message No. 0062401 (pertaining to case no. A-570-979) that "Commerce has not received a request for an administrative review of the antidumping duty order for the period and on the merchandise identified below except for the firm(s) listed in paragraph 3." The identified merchandise was:

Product: Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled into Modules Country: People's Republic of China Case number: A-570-979 Period: 12/1/2018 through 11/30/2019

Commerce further instructed CBP in this Message No. 0062401 to, inter alia, "liquidate all entries for all firms except those listed in paragraph 3 and assess antidumping duties on merchandise entered, or withdrawn from warehouse, for consumption at the cash deposit or bonding rate in effect on the date of entry." While Chint Solar (Zhejiang) Co., Ltd. and Chint Solar (Hong Kong) Company Limited were identified in paragraph 3, Astronergy was not.

On March 18, 2021, Commerce Message No. 1077409 (related to case no. C-570-980) instructed CBP to liquidate all entries and assess countervailing duties for subject entries of crystalline silicone photovoltaic cells whether or not assembled into modules entered for consumption between January 1, 2019, and December 31, 2019, that were produced by firms under the listed third-country case numbers except the firms listed in paragraph 3, which included "Astronergy Solar." For the firms listed in paragraph 3, Commerce instructed CBP that entries of merchandise from those firms should not be liquidated until specific instructions are issued and to continue to suspend liquidation.

Subsequently, on August 19, 2022, Commerce Message No. 2231401 (related to case no. C-570-980) instructed CBP to "assess countervailing duties on merchandise entered, or withdrawn from warehouse, for consumption during the period 01/01/2019 through 12/31/2019, at the cash deposit rate required at the time of entry," and liquidate all entries for the identified firms, which included "Astronergy Solar."

This entry was ultimately liquidated with the rate advances on May 28, 2021.

1. General Background Regarding Solar Products

Protestant does not provide much background on solar products generally or their production process. However, as Protestant, in part, challenges the imposition of additional duties based on the solar safeguard measure under Section 201, we refer to the background information on solar products available in the report of U.S. International Trade Commission ("ITC" or "Commission") from Inv. No. TA-201-75, Crystalline Silicon Photovoltaic Cells (Whether or not Partially or Fully Assembled into Other Products), USITC Pub. 4739 (Nov. 2017) that explains solar products generally and their production process. In particular, the Commission explains that:

1) "CSPV [(Crystalline Silicon Photovoltaic)] cells use crystalline silicon to convert sunlight to electricity and are the basic elements of a module[.] They have a positive layer, a negative layer and a positive negative junction (p/n junction). Electricity is generated when sunlight strikes the CSPV cell;"

2) "CSPV laminates consist of the CSPV cells that are connected, encapsulated in an ethyl vinyl acetate [ ] film, and covered with a glass front sheet and a back sheet;" and

3) "CSPV modules typically consist of the laminate that is typically 'framed' in aluminum, and then attached to a junction box."

Inv. No. TA-201-75, USITC Pub. 4739, Volume II (Nov. 2017) (Final) at I-11 to I-12.

Further, with respect to the manufacturing of such solar products, the Commission describes five principal manufacturing stages: "First, polysilicon is refined, then it is formed into ingots, which are sliced into wafers, converted to CSPV cells, and assembled into the finished product, modules[.]" Id. at I-18.

More specifically, the Commission describes the main steps in the cell manufacturing process (from wafers) as follows:

. Cleaning and texturing: First, the wafers are cleaned, then the surface of the wafer undergoes a chemical treatment that reduces the reflection of sunlight and increases light absorption[.] . Diffusion: In the next step, "phosphorus is diffused into a thin layer of the wafer surface. The molecular level impregnation occurs as the wafer surface is exposed to phosphorus gas at a high heat, a step that gives the surface a negative potential electrical orientation. The combination of that layer and the boron-doped layer below creates a positive-negative, or P/N, junction-a critical partition in the functioning of a PV cell." . Edge isolation: A thin layer of silicon is then removed from the edge of the CSPV cell to separate the positive and negative layers. . Coating: Next, a silicon nitride antireflective coating is added to the PV cells to increase the absorption of sunlight. . Printing: Metals are then printed on the solar CSPV cell to collect the electricity. On the front of the CSPV cell these metals are printed in thin metal strips called fingers, which are connected to the rest of the module via busbars. A metal layer, typically aluminum, is also printed on the back of the CSPV cell. . Co-firing: The CSPV cells then enter a furnace, where the "high temperature causes the silver paste to become imbedded in the surface of the silicon layer, forming a reliable electrical contact." . Testing and sorting: The final step in the process is the testing and sorting of the CSPV cells based on their characteristics and efficiency.

Id. at I-22 - I-23 (citations omitted). The cells are then assembled into modules. Id. at I-24.

2. This Protest and AFR

Astronergy filed this protest and AFR on November 23, 2021. Astronergy asserts the solar panels are of Cambodian origin and describes the production process of the solar panels as follows:

. Comalex PV (KH) Technology Co., Ltd. ("Comalex"), a company unrelated to Protestant, located in Cambodia purchases "wafers" from companies located in China. o Included with the protest were sales contracts showing the purchase by Comalex of wafers from companies in China. . The wafers are then sent from China to Cambodia. o Included with the protest were invoices, packing lists, and bills of lading showing that the purchased wafers were sent from China to Comalex in Cambodia. . In Cambodia, Comalex uses the wafers to manufacture solar cells, which entails: . Cleaning of the wafers and texturing; . Diffusion (make a positive-negative junction ("p/n junction")); . Etching; . PECVD[3]; . Screen Printing; and . Appearance color and inspection. o Included with the protest were "inventory-in slip[s]" and "inventory-out slip[s]" from Comalex showing the movement of wafers into and out of inventory; a chart tracing the production of cells from wafers at Comalex; charts showing the inputs and outputs from the production steps noted above; a chart showing the daily production numbers of solar cells; and a video showing the facility and production steps. . Comalex then sells the solar cells to Chint Solar (Hong Kong) Company Limited ("Chint Solar HK"), which is affiliated with Protestant, and both are owned by Chint Solar (Zhejiang) Co., Ltd. o Included with the protest was a sales contract and invoice showing the purchase by Chint Solar HK of "solar cells" from Comalex. . Chint Solar HK purchases these solar cells from Comalex to supply them to Enalex Energy (KH) Co., Ltd. ("Enalex"), another company unrelated to Protestant, located in Cambodia. Chint Solar HK and Enalex are parties to a "Commissioned Processing Contract" for "the production, procurement and technical support of the crystalline silicon solar modules[.]" According to this contract, Chint HK provides Enalex with solar cells, and Enalex, assembles the solar cells into solar modules. o Included with the protest was a copy of this contract. . The solar cells that Chint Solar HK purchased are shipped directly in Cambodia from Comalex to Enalex. o Included with the protest was a chart from Comalex showing the quantity of cells delivered to Enalex. . The solar cells are received and placed into inventory at Enalex. o Included with the protest were "inventory-in slip[s]" from Enalex corresponding to the batch numbers identified in the Comalex to Enalex delivery chart identifying the quantity entering into Enalex inventory. . The solar cells are withdrawn and consumed for solar module production by Enalex, which are tracked by Enalex's daily production reports. o Included with the protest was a daily production report from Enalex showing the number of solar cells used and the number of solar modules produced from those cells; chart tracing the cells used in solar module production; material sheets from Enalex. . The finished solar modules are then exported from Cambodia by Enalex to the Protestant in the United States. o Included with the protest were a chart of the delivery schedule; a chart tracing exportation of the solar modules; and the documents from the entry package including the entry summary, commercial invoice, packing list, country of origin certificate, waybill and arrival notice.

CBP denied the protest on December 20, 2021, noting that the importer failed to provide sufficient information to substantiate the claim that the country of origin of the solar cells was Cambodia.

ISSUES:

1. Whether the solar panels at issue are subject to the Section 201 safeguard measure or the Section 301 duties. 2. Whether the solar panels at issue are subject to ADD and CVD.

LAW AND ANALYSIS:

As an initial matter, we note that Astronergy timely filed this protest within the 180-day filing deadline set forth by 19 U.S.C. 1514(c)(3)(A) and 19 C.F.R. 174.12(e)(1). CBP liquidated the entry at issue on May 28, 2021. Astronergy filed this protest on November 23, 2021. The Center of Excellence and Expertise for Electronics subsequently forwarded the protest to this office for further review. The criterion for further review has been satisfied because this matter involves questions of fact which have not been ruled upon by CBP or the courts. See 19 C.F.R. 174.24(b), 174.26(b)(1)(iv).

Further, we note that the analysis and role CBP plays in the Section 201 and 301 trade remedy context is different from the ADD/CVD context. See e.g., ARP Materials, Inc. v. United States, 520 F. Supp. 3d 1341, 1360 (Ct. Int'l Trade, 2021) ("Unlike in [ ] Mitsubishi [v. United States, 44 F.3d 973 (Fed. Cir., 1994) where the Federal Circuit held that because the Commerce Department determined antidumping duty rates, Customs' role in collecting those duties was 'ministerial' rather than a decision under section 1514(a)], Customs here performed more than a passive or ministerial function; in classifying Plaintiffs' entries under HTSUS subheadings subject to Section 301 duties, it made substantive legal (interpreting the HTSUS subheadings) and factual (determining whether the entries fell within those subheadings) determinations that it had the authority to make. These determinations required Customs to exercise genuine interpretive or comparable judgments.") (citation omitted) (internal quotation marks omitted). Thus, we will address each separately in the sections below.

1. Whether the solar panels at issue are subject to the Section 201 safeguard measure or the Section 301 duties.

A. Section 201

"Section 201 of the Trade Act of 1974, codified at 19 U.S.C. 2251, provides the President of the United States with the power to impose 'safeguards' (also referred to as 'safeguard measures') that protect domestic industries from serious injury caused by imports." Solar Energy Indus. Ass'n v. United States, 2023 U.S. App. LEXIS 30058, *4 (Fed. Cir., 2023). Under Section 201, upon petitions from domestic entities or industries, (a) the U.S. International Trade Commission ("ITC" or "Commission") may make an affirmative determination that serious injury or a threat of serious injury to that industry exists; and (b) the President may then authorize "safeguards," to provide a domestic industry temporary relief from serious injury. Id. at * 5-6 (citing 19 U.S.C. 2252 and 2253).

The President issued Presidential Proclamation 9693 on January 23, 2018 authorizing a safeguard measure against imports of solar panels into the United States. Solar Energy Indus., 2023 U.S. App. LEXIS 30058 *2 (citing Proclamation 9693: To Facilitate Positive Adjustment to Competition from Imports of Certain Crystalline Silicon Photovoltaic Cells (Whether or Not Partially or Fully Assembled into Other Products) and for Other Purposes). The Presidential Proclamation imposed temporary safeguard duties of 30% on certain Crystalline Silicon Photovoltaic ("CSPV") products, to decrease by five percent each year until 2022. Invenergy Renewables LLC v. United States, 422 F. Supp. 3d 1255, 1266 (citing U.S. Int'l Trade Comm'n, Crystalline Silicon Photovoltaic Cells (Whether or not Partially or Fully Assembled into Other Products), Inv. No. TA-201-75, USITC Pub. 4739 (Nov. 2017)); see also 83 Fed. Reg. 3541 (January 25, 2018). Among the CSPV products subject to this safeguard measure are "solar cells, whether or not assembled into modules or made up into panels provided for in subheading 8541.40.60 in Annex 1 to this proclamation[.]" 83 Fed. Reg. at 3542.

Annex 1 to Presidential Proclamation 9693 modifies subchapter III of chapter 99 of the Harmonized Tariff Schedule of the United States ("HTSUS") by inserting a new U.S. note, i.e., Note 18, and provisions. See Annex 1 of 83 Fed. Reg. 3541. This modification is effective with respect to goods entered, or withdrawn from warehouse for consumption, from February 7, 2018 through February 6, 2022. Id. Under Note 18, products classified under subheading 8541.40, HTSUS, unless specifically excluded, are subject to the additional duties. See Note 18 to Chapter 99 and subheadings 9903.45.21 through 9903.45.25, HTSUS.

According to Note 18(g) to Chapter 99, "modules" within the meaning of subheading 9903.45.25, HTSUS, include, inter alia, products of subheading 8541.40.60 of the permanent HTSUS consisting of "a joined group of CSPV cells...capable of generating electricity." See Note 18 to Chapter 99 and subheadings 9903.45.21 through 9903.45.25, HTSUS. Regarding the latter criterion, CSPV cells are defined in Note 18(c) as "crystalline silicon photovoltaic cells of a thickness equal to or greater than 20 micrometers...having a p/n junction." Id. Subheading 9903.45.25, HTSUS, applies to modules which are "the product or originating good of a country other than a country described in note 18(b)." Note 18(b) in turn provides that "for the purposes of this note and the application of subheadings 9903.45.21 through 9903.45.25," certain enumerated "developing countries that are members of the World Trade Organization shall not be subject to the rates of duty...provided for therein." Among the list of countries exempt from the rates of duty appertaining to subheading 9903.45.25, HTSUS is Cambodia.

The solar panels at issue entered on May 4, 2019, when the safeguard measure, as implemented by Note 18, remained in effect. The solar panels at issue were entered under subheading 8541.40.6015. However, Protestant does not dispute that unless the solar panels at issue are considered a product of Cambodia, they would be subject to the increased duties imposed by the safeguard measure. Accordingly, the applicability of the safeguard measure turns on whether the solar panels are a product of Cambodia for purposes of Section 201 of the Trade Act of 1974 (19 U.S.C. 2251).

B. Section 301

"Section 301 of the Trade Act of 1974 authorizes the [U.S. Trade Representative ("USTR")] to take various actions to protect U.S. interests when foreign trade partners violate trade agreements or otherwise take actions adverse to U.S. trade interests." ARP Materials, Inc. v. United States, 520 F. Supp. 3d 1341, 1347 (Ct. Int'l Trade, 2021) (citing 19 U.S.C. 2411(a)(1)). In 2017, under this authority, the USTR initiated a Section 301 investigation concerning certain Chinese trade practices. Id. at 1347-1348 (citing Initiation of Section 301 Investigation; Hearing; and Request for Public Comments: China's Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation, 82 Fed. Reg. 40,213, 40,213 (USTR Aug. 24, 2017)). The USTR found that China's conduct was actionable under Section 301 and proposed an additional 25 percent ad valorem duty on various products originating in that country. Id. at 1348 (citing Notice of Determination and Request for Public Comment Concerning Proposed Determination of Action Pursuant to Section 301: China's Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation, 83 Fed. Reg. 14,906, 14,907 (USTR Apr. 6, 2018)). "The USTR later imposed Section 301 tariffs on goods from China via a series of [ ] 'lists,' referred to as List 1 through List 4B. The USTR imposed the tariffs by inserting new subheadings into the HTSUS to encompass the articles on the lists." Id. (citing Notice of Action Pursuant to Section 301: China's Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation, 83 Fed. Reg. 40,823, 40,825 (USTR Aug. 16, 2018).

Subheading 9903.88.02 was inserted as part of the List 2 process. Id. U.S. note 20(c), which was also inserted simultaneously into subchapter III of chapter 99, noted that "[t]he products of China that are subject to an additional 25 percent ad valorem rate of duty under heading 9903.88.02 are products of China that are classified in the subheadings enumerated in U.S. note 20(d) to subchapter III." 83 Fed. Reg. at 40,825. Among the subheadings listed in U.S. note 20(d) is 8541.40.60. Id. at 40,835. These modifications to subchapter III of chapter 99 of the HTSUS were effective with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after August 23, 2018. Id. at 40,825.

As noted, the solar panels at issue were entered on May 4, 2019, and under subheading 8541.40.6015. However, as noted above, there is no dispute that if the solar panels at issue are considered a product of China, the Section 301 tariffs would apply. Accordingly, the applicability of the Section 301 tariffs turns on whether the solar panels are a product of China for purposes of Section 301 of the Trade Act of 1974 (19 U.S.C. 2411).

C. Substantial Transformation

When determining country of origin for purposes of administering trade remedies under Section 201 and Section 301, CBP has consistently applied the substantial transformation analysis. See e.g., Cyber Power Sys. v. United States, 560 F. Supp. 3d 1347, 1351 (Ct. Int'l Trade, 2022); CBP HQ Ruling H304677 (dated April 21, 2023) at 3. The test for determining whether a substantial transformation has occurred is whether an article emerges from a process with a new name, character or use, different from that possessed by the article prior to processing. See Texas Instruments Inc. v. United States, 69 C.C.P.A. 151 (1982); see also Belcrest Linens v. United States, 741 F.2d 1368, 1372 (Fed. Cir., 1984). This determination is based on the totality of the evidence. See National Hand Tool Corp. v. United States, 16 C.I.T. 308 (Ct. Int'l Trade, 1992), aff'd, 989 F.2d 1201 (Fed. Cir., 1993).

Consequently, for purposes of the Section 201 safeguard measure and the Section 301 duties, the solar panels at issue are "products of" the country in which they were last substantially transformed before their importation into the United States. In other words, the dispositive question in this matter is whether the solar products at issue were substantially transformed in Cambodia. For the reasons below, we conclude that they were. In particular, we find that the wafers from China were substantially transformed into solar cells in Cambodia through the addition of the p/n junction.

First, we find that the wafers sourced from China undergo a change in name when they are turned into solar cells. For example, the "Sales Contract," and related documentation including the invoice and packing list, between Comalex and the Chinese companies from which the wafers were purchased, refers to the items purchased as "wafer[s]" or "solar wafer[s]." Comalex's inventory-in slips and inventory-out slips also refer to "wafer[s]." In contrast, after the wafers are turned into solar cells by Comalex, the name solar cell is used and there are no longer references to wafers. For example, the invoice between Chint Solar HK and Comalex showing the sale of solar cells from Comalex to Chint Solar (HK) refers to the sold articles as "solar cell[s]" and Enalex's inventory-in slips also refer to the products as "cells." Further, even when assembling the solar panels (and in the finished solar panel), the solar cells are consistently referred to as cells (or a slight variation thereof). Once the solar cell manufacturing process is completed, the wafer loses its name, and is referred to as the finished product, i.e., a solar cell: it does not retain its name in the finished product. For example, in the solar panel, the solar cell component is referred to as a solar cell, it is not referred to as a wafer. See e.g., Ferrostaal Metals Corp. v. United States, 664 F. Supp. 535, 541 (Ct. Int'l Trade, 1987).

Turning to character, we find that there is also a change in character as a result of the manufacturing process in Cambodia turning wafers into solar cells. For courts to find a change in character, there often needs to be a substantial alteration in the characteristics of the articles or components. See e.g., National Hand Tool, 16 C.I.T. at 311. In other cases, courts have looked to the "essence" of a completed article to determine whether an imported article has undergone a change in character as a result of post importation processing. Energizer Battery, Inc. v. United States, 190 F. Supp. 3d 1308, 1318 (Ct. Int'l Trade, 2016) (citing Uniden America Corp. v. United States, 120 F. Supp. 2d 1091, 1095-1098 (Ct. Int'l Trade, 2000) and Uniroyal, Inc. v. United States, 542 F. Supp. 1026 aff'd, 702 F.2d 1022 (Fed. Cir., 1983)). Here, the manufacturing process in Cambodia of turning the wafers into solar cells includes the process known as "doping," in which phosphorous is diffused into a thin layer of the wafer surface to create a negatively charged phosphosilicate layer terminating in a p/n junction. See e.g., CBP HQ Ruling H301813 (dated May 24, 2019). As explained in HQ H301813, "[t]his is a critical partition in the functioning of a solar cell. After the p/n junction is created, the cells can optimally gather photons and produce electricity. The essential characteristic of the solar cell is to convert sunlight into electricity,[ ] and it can do so when the p/n junction is put in place." (footnote omitted). Thus, we find that this manufacturing process results in a change in character, for example, by significantly altering the electrical properties of the wafer.

In addition, we find that the wafers sourced from China undergo a change in use as a result of the solar cell manufacturing process in Cambodia. In looking at whether there is a change in use, courts have found that a change in use has occurred when the end use of the imported product was no longer interchangeable with the end use of the product after post importation processing; in contrast, when the end use was predetermined at the time of importation, courts have generally not found a change in use. Energizer Battery, 190 F. Supp. 3d at 1319 (citing Ferrostaal Metals, 664 F. Supp. at 540-41; National Hand Tool, 16 C.I.T. at 311-12; Ran-Paige Co., Inc. v. United States, 35 Fed. Cl. 117, 121-22 (Ct. Fed. Claims, 1996); Uniroyal, 542 F. Supp. At 1031). Here, the evidence supports the finding that the wafers are not interchangeable with the solar cells. Indeed, without the addition of the p/n junction in Cambodia as part of the solar cell manufacturing process, the wafer alone would not be able to convert sunlight into electricity, which is the essential characteristic of not only the solar cell, but also the solar panels at issue. See e.g., Ferrostaal Metals, 664 F. Supp. at 540-41. Accordingly, we find that there is a change in use.

In light of the above, we find that the wafers are substantially transformed into solar cells in Cambodia as there was a change in name, character and use. As such, we find that the solar cells and the solar panels at issue[4] incorporating these cells are products of Cambodia and not subject to the Section 201 safeguard measure or the Section 301 duties.

2. Whether the solar panels at issue are subject to ADD and CVD.

A. The Orders On December 7, 2012, Commerce published the ADD order in case no. A-570-979 and the CVD order in case no. C-570-980 on certain crystalline silicon photovoltaic cells, whether or not assembled into modules, from China. 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 FR 73018 (December 7, 2012) ("ADD Order") and Crystalline Silicon Photovoltaic Cells, Whether or Not Assembled into Modules, from the People's Republic of China: Countervailing Duty Order, 77 FR 73017 (December 7, 2012) ("CVD Order") (collectively, "Orders"). The merchandise covered by the Orders "is crystalline silicon photovoltaic cells, and modules, laminates, and panels, consisting of crystalline silicon photovoltaic cells, whether or not partially or fully assembled into other products, including, but not limited to, modules, laminates, panels and building integrated materials." Id. The Orders cover "crystalline silicon photovoltaic cells of thickness equal to or greater than 20 micrometers, having a p/n junction formed by any means, whether or not the cell has undergone other processing, including, but not limited to, cleaning, etching, coating, and/or addition of materials (including, but not limited to, metallization and conductor patterns) to collect and forward the electricity that is generated by the cell." Id. (emphasis added). The entry at issue was liquidated on May 28, 2021 in line with Commerce Message No. 0062401 (March 2, 2020). However, while, CBP received liquidation instructions on March 2, 2020, directing it to "liquidate all entries for all firms except those listed in paragraph 3 [which did not include Protestant] and assess antidumping duties" on solar cells from China whether or not assembled into modules entered between December 1, 2018 through November 30, 2019, CBP could not liquidate the entry at issue because it was also subject to a countervailing duty order for which suspension of liquidation had not yet lifted, see Commerce Message No. 1077409 (March 18, 2021). 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 August 19, 2022 in Commerce Message No. 2231401. Thus, CBP could not have liquidated the entry at issue until that date. Accordingly, CBP erroneously liquidated the entry at issue under Message No. 0062401 (March 2, 2020), prior to the issuance of Message No. 2231401, dated August 19, 2022. CBP's premature liquidation of the entry of solar products 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. SSAB N. Am. Div. v United States Bureau of Customs & Border Prot., 571 F Supp. 2d 1347, 1352 (Ct. Int'l Trade 2008); see HQ H265169 (dated May 23, 2019); see also HQ H293759 (dated May 21, 2021). While CBP liquidated the entry at issue before the countervailing liquidation instructions was issued on August 19, 2022, 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 (dated March 9, 2004); see also, HQ 221591 (dated Feb. 13, 1990) (cancellation of a liquidation is not a viable option under Customs laws and regulations); see also HQ H293759 (dated May 21, 2021).

B. CBP's Role in the ADD/CVD Context and Protestability

"Commerce is charged with interpreting the scope of an [ADD or CVD] order, but Customs applies and enforces the order through the assessment and collection of antidumping and countervailing duties." TR Int'l Trading Co. v. United States, 4 F.4th 1363, 1368 (Fed. Cir. 2021) (citations omitted); see also 19 U.S.C. 1671e and 19 U.S.C. 1673e. "Customs merely follows Commerce's instructions in assessing and collecting duties." Mitsubishi Elecs. Am. Inc. v. United States, 44 F.3d 973, 977 (Fed. Cir. 1994). Customs cannot "modify Commerce's determinations, their underlying facts, or their enforcement." Id. (quoting Royal Bus. Machs. Inc. v. United States, 507 F. Supp. 1007, 1014, n.18 (Ct. Int'l Trade, 1980)). Customs plays a "merely ministerial role in liquidating antidumping duties," id. at 977, and "should do no more than enact the intentions of Commerce." Shinyei Corp. of Am. v. United States, 2011 Ct. Int'l Trade LEXIS 65, *10 (June 15, 2011). "When an importer disputes Customs' application of an antidumping or countervailing duty order, the proper remedy is for the importer to seek a scope inquiry from Commerce, the result of which may subsequently be challenged before the CIT. See 19 U.S.C. 1514(b) (stating that Customs' decisions on trade remedy orders are final and conclusive unless the importer files a complaint under 19 U.S.C. 1516a, the statutory provision providing for challenges to Commerce scope determinations)." Sunpreme Inc. v. United States, 892 F.3d 1186, 1193 (Fed. Cir. 2018) ("Sunpreme I"). It is only in those cases "where the scope of a duty order is unambiguous and undisputed, and the goods clearly do not fall within the scope of the order, [that] Customs' misapplication of the duty order is a protestable decision reviewable by the [Trade Court] under 1581(a)." TR Int'l Trading Co., 4 F.4th at 1368 (quoting Sunpreme I at F.3d 1192). For example, "[w]hen merchandise may be subject to an antidumping duty order, Customs makes factual findings to ascertain what the merchandise is, and whether it is described in an order." Xerox Corp. v. United States, 289 F.3d 792, 794 (Fed. Cir. 2002) (citation omitted). These types of factual determinations by CBP are generally protestable matters under 19 U.S.C. 1514(a). See TR Int'l Trading Co., 4 F.4th at 1368 ("Protests are the typical avenue for addressing factual or procedural issues in Customs determinations.") (citing 19 U.S.C. 1514(a) (noting that "any clerical error, mistake of fact, or other inadvertence" in a "liquidation" or decision regarding "rate and amount of duties chargeable" "shall be final . . . unless a protest is filed" or judicial review is obtained)).

Thus, insomuch as Astronergy is protesting a factual determination made by CBP, the matter is protestable. See Xerox Corp., 289 F.3d at 795 ("In cases such as this, where the scope of the antidumping duty order is unambiguous and undisputed, and the goods clearly do not fall within the scope of the order, misapplication of the order by Customs is properly the subject of a protest under 19 U.S.C. 1514(a)(2)."). Specifically, the question of fact that is at issue here is whether the wafers sourced from China had a p/n junction prior to importation to Cambodia. We find that the p/n junction was not added to the wafers until after the wafers had entered into Cambodia. This is supported by, for example, the documentation showing the shipment of wafers from China to Cambodia and the production records showing the step by step processing of the wafers in Cambodia along with the number of corresponding outputs.

"[M]erchandise that is subject to an antidumping or countervailing duty order must be (1) the type of merchandise described in the order and (2) from the particular country or countries covered by the scope of the order as written by Commerce." Bell Supply Co., LLC v. United States, 179 F. Supp. 3d 1082, 1085 (Fed. Cir. 2016). The scope of the Orders defines solar cells as, inter alia, "having a p/n junction[.]" The information provided by Protestant indicates that the p/n junction was not added to the wafers until after the wafers arrive in Cambodia. The wafers sourced from China do not have a p/n junction present, and as such cannot be classified as solar cells under the plain language of the scope of the Orders. Thus, as the solar cells and the solar panels at issue are from Cambodia (the information provided by Protestant suggests that other than the wafers, which are from China, the remaining components and manufacturing and assembly operations are all from, or take place in, Cambodia), and not the particular country, i.e., China, covered by the Orders, we find that the Orders do not apply.

As such, CBP should reliquidate the entry without the assessment of the Additional Duties.

HOLDING:

Based on the foregoing, we find that the solar panels at issue are not subject to the Section 201 safeguard measure, the Section 301 duties, the antidumping duty, or the countervailing duty. Accordingly, the protest should be GRANTED in full.

You are instructed to notify the Protestant of this decision no later than 60 days from the date of this decision. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to this notification. Sixty days from the date of the decision, the Office of Trade, Regulations and Rulings will make the decision available to CBP personnel and the public on the Customs Rulings Online Search System ("CROSS") at https://rulings.cbp.gov/, or other methods of public distribution.

Sincerely,

Yuliya A. Gulis, Director
Commercial and Trade Facilitation Division

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[1] Astronergy submitted a "Corrected 1st page" on November 24, 2021, and a supplemental letter on October 18, 2023.

[2] Certain documentation, such as the commercial invoice and packing list, submitted with the entry at issue in this protest refers to the imported merchandise as "solar panels." However, Protestant tends to refer to that merchandise as "solar modules" throughout its submissions in connection with this protest. As Protestant has not made a distinction with respect to these terms, "solar panels" and "solar modules" will be used interchangeably throughout this protest decision.
[3] Astronergy used this acronym to describe a step in the solar cell manufacturing process but neglected to define the acronym. Based on our independent research, we understand that "PECVD" stands for plasma enhanced chemical vapor deposition.
[4] While CBP has held in the past that assembly of solar cells into solar modules does not result in substantial transformation, we need not reach that issue here as the solar panels at issue were assembled in Cambodia, the same country as where the solar cells were manufactured. See e.g., CBP HQ Ruling H301813 (dated May 24, 2019) ("[A]ssembling solar cells into finished solar panels does not result in a product with a new name, character, and use.").