LIQ-4-01; LIQ-11 RR:CR:DR
229761 RDC
U.S. Customs Service
Port Director
One East Bay St.
Savannah, GA 31401
RE: Scarlett Vikas International, Inc. - Protest number 1704-93-100161; petroleum wax candles from the People's Republic of China; 19 USC § 1514; antidumping case number A-570-504; Mitsubishi Electronics America, Inc. v. United States, 44 F.3d 973 (Fed Cir. 1994); deemed liquidation; liquidation by operation of law; 19 USC § 1504(d)
Dear Sir or Madam:
The above-referenced Protest was forwarded to this office for further review. We note that this Protest was received at the Port of Savannah on March 18, 1993. Subsequently, the original file was sent to this office but not received; a copy of the file was received on December 20, 2002. An additional submission from the Protestant's counsel was received on January 9, 2003. Our decision follows.
FACTS:
Scarlett Vikas International, Inc., ("Scarlett"), requests further review of Protest number 1704-93-100161 which protests the liquidation of entry numbers 86-422xxx-8 and 86-422xxx-1. Specifically, the Protestant protests the imposition of "$42,921.26 in additional antidumping duties beyond estimated antidumping duties deposited by Scarlett at time of entry." The goods upon which the additional antidumping duties were imposed are described on the CF 7501s as "candles and tapers," from China and classified at 755.2500, Tariff System of the United States, (TSUS).
According to the CF 7501s, entry number 86-422xxx-8 was entered on April 24, 1986, and entry number 86-422xxx-1 was entered on April 28, 1986. The CF 7501s for both entries are dated May 8, 1986; both show that among the goods entered were "candles and tapers" subject to antidumping duty order, Customs identification number A-570-504. The CF 7501 for entry number 244-8 shows that a duty of 6.3 percent and an antidumping duty of 60.66 percent were initially paid. On the CF 7501 for entry number 86-422xxx-1 there are two line numbers for "candles and tapers." The first shows that a duty of 6.3 percent and an antidumping duty of "free" were initially paid. The second line shows that a duty of 6.3 percent and an antidumping duty of 60.66 percent were initially paid. On both entries the antidumping duty rate- 60.66 percent and the "free" on entry 86-422xxx-1- have been struck through by hand and replaced with "35.73 %". Handwritten in red ink next to the changes on entry 86-422xxx-8 and on the preceding page on entry 86-422xxx-1 is "per 328116 dated 10/14/92 liq. at rate in effect at time of entry for A570-504."
The Protestant explains that stating the antidumping duty rate as "free" on entry 86-422xxx-1 was an error. According to the Protestant, this error was corrected with an amended entry summary and Scarlett tendered antidumping duty at the rate of 60.66 percent for this entry. Also included in the file is a CF 29, Notice of Action dated November 17, 1992, addressed to Scarlett. This notice states that the referenced entries, 86-422xxx-1 and 86-422xxx-8, were "liquidated according to liquidation instructions for the anti-dumping case A570-504. The entr[ies have] been processed with an anti-dumping rate of 135.73%, which was the rate in effect at the time of entry."
On September 30, 1985, the Department of Commerce ("DOC"), International Trade Administration, published notice of the Initiation of an Antidumping Duty Investigation regarding petroleum wax candles from the People's Republic of China (PRC) (50 FR 39743 ). On February 19, 1986, the DOC published Notice of a Preliminary Determination that petroleum wax candles from the PRC were being, or were likely to be, sold in the United States at less than fair value. That notice stated that Customs had been directed to suspend the liquidation of all entries of such candles on or after the date of publication of that Notice, February 19, 1986, and to collect cash deposits or the posting of a bond at the weighted-average dumping margin of 60.66 percent on these entries (51 FR 6016). On March 7, 1986, the DOC published Notice that it had amended its preliminary determination and that the antidumping margin applicable to petroleum wax candles from the PRC was corrected to 135.73 percent (51 FR 7977).
On July 10, 1986, the Department of Commerce published Notice of its Final Determination of Sales at Less Than Fair Value with regard to petroleum wax candles from the PRC (51 FR 25085). This Notice stated, in part:
"We are directing the United States Customs Service to continue to suspend liquidation of all entries of petroleum wax candles from the PRC that are entered, . . . for consumption, on or after February 19, 1986, . . . . The United States Customs Service shall continue to require a cash deposit or the posting of a bond equal to the estimated weighted-average . . . . The bond or cash deposit amounts established in our amended preliminary determination of March 7, 1986, remain in effect with respect to entries or withdrawals made prior to the date of publication of this notice [July 10, 1986]. . . .
On August 28, 1986, the DOC published notice of the Antidumping Duty Order for petroleum wax candles from the PRC (51 FR 30686). This Notice stated in part: "all unliquidated entries, . . . of petroleum wax candles from the PRC made on or after February 19, 1986, . . . will be liable for the possible assessment of antidumping duties." On November 25, 1988, the DOC published the notice of final results of antidumping duty administrative review regarding petroleum wax candles from the PRC.
On October 14, 1992, liquidation instructions, message number 3288116 were issued to Customs by the International Trade Administration ("ITA"), DOC. This message instructed Customs to:
"assess antidumping duties on merchandise entered, . . . for consumption during the periods listed below at the cash deposit . . . required at the time of entry."
The period specified for all firms other than PC Interprises is "2/19/86 - 7/31/87." The liquidation instructions also stated:
"this telex constitutes the immediate lifting of suspension of liquidation of entries for the merchandise and periods listed above."
According to the Protestant both protested entries were liquidated on December 18, 1992. Scarlett filed the instant Protest on March 18, 1993.
ISSUE:
Were the entries liquidated in accordance with the law and regulations?
LAW AND ANALYSIS:
We note initially that the instant Protest was timely filed, i.e., within 90 days of the liquidation of the entries (19 USC § 1514(c)(3)(B)). Under 19 USC § 1514(a) "decisions of the Customs Service, including the legality of all orders and findings entering into the same, as to . . . the liquidation or reliquidation of an entry . . . are final unless a protest of that decision is filed within 90 days of the notice of liquidation (19 USC §1514(c)(3)(B)). According to the Protestant, the subject entries were liquidated on December 18, 1992; this Protest was filed on March 18, 1993. Also, per § 1514(a)(5), the matter protested, the liquidation of the entries, is subject to protest.
The Protestant seeks further review per 19 CFR § 174.24(b) and states "further review of this protest is justified for the reason that it involves questions of law or fact which have not previously been ruled upon by the Commissioner of Customs or his designee or by the Customs courts." We assume since this Protest was forwarded by the port of Savannah to this office that it is also the opinion of the Port that this Protest warrants further review. Under 19 USC § 1515, "[u]pon the request of the protesting party . . . a protest may be subject to further review by another appropriate customs officer, under the circumstances and in the form and manner that may be prescribed . . . in regulations." We agree that further review is warranted.
The Protestant states that this protest is against the "district director's decision . . . to liquidate the subject entries assessing" antidumping duties in excess of the antidumping duties deposited at entry. Generally, antidumping duty rates correctly applied by Customs are not protestable, (Fujitsu Ten Corp. v. United States, 957 F. Supp. 245; Ct. Intl. Trade 1997)) because "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)). Customs "may not independently modify, directly or indirectly the determinations, [the Department of Commerce's] underlying facts, or their enforcement" (Royal Business Machines Inc. v. United States, 507 F. Supp. 1007, 1014 n.18 (Ct. Int'l Trade 1980), aff'd, 69 C.C.P.A. 61, 669 F.2d 692 (CCPA 1982)).
Thus, the role of the Customs Service with regard to antidumping duties is simply to follow Commerce's instructions in collecting deposits of estimated duties and assessing antidumping duties at the time of liquidation. The Customs Service plays no part in calculating the amount of antidumping duty which is imposed with respect to specific entries. Customs simply takes the dumping margin determined by Commerce and applies it to the entries as directed by Commerce's instructions. Accordingly, while both the Customs Service and Commerce play a part in the enforcement of the antidumping laws, their roles are separate and distinct. Only decisions made by the Customs Service may be protested per 19 USC § 1514(a). However, an importer may protest Customs' failure to follow a Commerce instruction under 19 USC § 1514 (American Hi-Fi International, Inc. v. United States, 19 C.I.T. 1340 (1995); Xerox Corporation v. United States, 289 F.3d 792 (U.S. App. 2002); HRL 229330 (March 12, 2002)).
The Protestant pursues several arguments in its "Attachment to Protest," most of which are not decisions of the Customs Service and therefore are not within the authority of this office to address. The Protestant states that "the delay by the ITA" specifically, "the excessive delay in billing Scarlett for these additional antidumping duties violates Scarlett's constitutional rights of due process under the law." 19 USC § 1514 sets out the decisions of the Customs Service which are subject to protest under this section. Clearly, the ITA's actions are not decisions of the Customs Service and cannot be protested per 19 USC 1514. Hence, this contention is not a protestable matter under the authority of the Customs Service and this office is without authority to address this contention.
Scarlett also argues that the antidumping duty rate applicable to the protested entries is 54.21 percent, per the Antidumping Duty Order (August 28, 1986) and the difference between the 60.66 percent actually deposited and the 54.21 percent applicable should be refunded. For authority for its contentions Scarlett refers to 19 USC § 1673f (1993) which provides for the "treatment of difference between deposit of estimated antidumping duty and final assessed duty under antidumping duty order." Second, the Protestant argues that the entries should not have been liquidated with an antidumping duty rate of 135.73 percent, i.e., the protested entries should have been liquidated with 54.21 percent antidumping duties, per the Antidumping Duty Order (August 28, 1986), not 135.73 percent. The Protestant contends that 19 CFR § 353.22(e) (1992) which provides that if a timely review is not requested, then the DOC should instruct Customs to assess antidumping duties equal to the estimated duties or cash deposit rate required at the time of entry, does not apply. The application of this regulation is within the DOC's authority - not Customs - therefore we do not address this contention.
Further, Scarlett argues that the entries should have been deemed liquidated by operation of law per 19 CFR § 159.12(f) (1992). The Protestant states, in part, "the ITA should have removed the suspension [of liquidation], and instructed Customs to liquidate the entries, and Customs should have liquidated the entries, in 1987." Scarlett also argues, "the ITA abused its discretion and acted in a manner prejudicial to Scarlett. It should be held to have removed the suspension and issued liquidation instructions to Customs immediately after August 1987, when the time for filing request for administrative review expired." We need not address the Protestant's arguments as contended in its original Protest because we find that the Protestant prevails on alternate grounds.
In its supplemental submission of January 9, 2003, the Protestant argues that the entries "were deemed liquidated by operation of law on the fourth anniversary of the date of entry" per 19 USC § 1504(d) (1988), International Trading Company v. United States, (281 F.3d 1268 (U.S. App 2002)), and American Permac, Inc. v. United States, 642 F. Supp. 1187 (Ct. Intl. Trade 1986)). Scarlett argues that the publication in the Federal Register of the final results of an administrative review serves as notice to U.S. Customs of the lifting of the suspension of liquidation within the meaning of the deemed liquidation statute." Thus Scarlett concludes that the suspension of liquidation of the two protested entries was lifted on "November 25, 1988, the date of publication in the Federal Register of the final results of the first administrative review." Therefore, the protested entries were deemed liquidated "at the expiration of four years" from the date of entry, i.e., on April 24, 1990, and on April 28, 1990, respectively.
Section 1504 was enacted by Public Law 94-410, section 209(a), 92 Stat. 902. This provision was made effective "to the entry or withdrawal of merchandise for consumption on or after 180 days after the enactment of this Act [October 3, 1978]" (Section 209(b), Pub. L. 95-410). See F. W. Myers & Co., Inc. v. United States, 607 F. Supp. 1470 (1985); and Peugeot Motors of America, Inc. v. United States, 8 CIT 167, 595 F. Supp. 1154 (1984), applying this effective date to section 1504. We note that § 1504 was amended in 1984 to substitute "the importer of record" for "the importer, his consignee or agent." This amendment is not pertinent to the facts here. Further, this provision was also amended by section 641 of Public Law 103-182, the North American Free Trade Agreement Implementation Act (107 Stat. 2057, 2204), enacted December 8, 1993 but the amendment to section 1504 affected by Public Law 103-182 also would not be applicable to the present case.
The applicable 19 USC § 1504 (1992) provides, in pertinent part:
Except as provided in subsection (b), an entry of merchandise not liquidated within one year from:
(1) the date of entry of such merchandise; . . .
shall be deemed liquidated at the rate of duty, value, quantity, and amount of duties asserted at the time of entry by the importer of record.
Thus, an entry is deemed liquidated as entered if Customs has not liquidated the entry within one year from the date of entry unless liquidation is extended as provided in § 1504(b):
The Secretary may extend the period in which to liquidate an entry by giving notice of such extension . . . , if . . . (2) liquidation is suspended as required by statute or court order; . . . .
Liquidation of the protested entries was suspended per 19 USC § 1673b(d) (1993), which stated:
If the preliminary determination of the administering authority under subsection (b) is affirmative, the administering authority-
(1) shall order the suspension of liquidation of all entries of merchandise subject to the determination which are entered, or withdrawn from warehouse, for consumption on or after the date of publication of the notice of the determination in the Federal Register, . . . .
The DOC published such a "Notice of a Preliminary Determination" on February 19, 1986; that notice also directed Customs to suspend the liquidation of entries subject to the investigation that were entered on or after the date of publication of that Notice, i.e., February 19, 1986. The protested entries were entered during April, 1986 and their liquidation was thus properly suspended.
Section 1504 further provided:
Any entry of merchandise not liquidated at the expiration of four years from the applicable date specified in subsection (a) of this section, shall be deemed liquidated at the rate of duty, value, quantity, and amount of duty asserted at the time of entry by the importer of record unless liquidation continues to be suspended as required by statute or court order. When such a suspension of liquidation is removed, the entry shall be liquidated within 90 days therefrom
(19 USC § 1504(d) (1992)).
In American Permac, Inc. v. United States the CIT held that, where liquidation suspension during periodic reviews was required by the antidumping statute, "the statutorily required suspension of liquidation continued until the ITA published the final results of its review" (642 F. Supp. 1187, 1197 (Ct. Intl. Trade 1986)). See also, International Trading Company v. United States, 281 F.3d 1268, 1277 (U.S. App. 2002) holding "that suspension of liquidation was removed . . . , when the final results of the administrative review were published in the Federal Register." Therefore, the suspension of liquidation of the protested entries was lifted on November 25, 1988, when the DOC published the notice of final results of antidumping duty administrative review. Further, under Nunn Bush Shoe Company v. United States (784 F. Supp. 892 (Ct. Intl. Trade 1992)), which held that, per 19 USC § 1504, entries not suspended in any way were deemed liquidated by operation of law when they became four years old, because the protested entries were not liquidated at the expiration of four years from the date of entry, i.e. April, 1986, these entries were deemed liquidated on April 24, 1990, and on April 28, 1990.
The Protestant next argues that the entries were "deemed liquidated at the [antidumping] cash deposit rate asserted by Scarlett at the time of entry," i.e., 60.66, per Rheem Metalurgica v. United States, 951 F.Supp 241 (Ct. Int'l. Trade (1996)). We agree that the entries should be liquidated in accordance with Rheem Metalurgica In Rheem Metalurgica the court held that entries subject to countervailing duties which liquidated by operation of law, liquidated with countervailing duties due at the rate at which the importer was required to post a bond or deposit cash, upon entry. in the amounts asserted by the importer and accepted by Customs on the entry. See also HRL 227793 (November 4, 1998). Since the alterations to the antidumping duty rates on the CF 7501 are in red ink, it is clear that per 19 CFR 141.90(d) these alterations were made by Customs officials at the port. Therefore since the importer asserted an antidumping duty at a rate of 60.66 percent, entry number 86-422xxx-8 was deemed liquidated at this rate and entry number 86-422xxx-1 was deemed liquidated with antidumping duty at a rate of 60.66 percent as asserted on the amended entry summary.
HOLDING:
The protested entries were deemed liquidated at the expiration of four years from the date of entry, i.e., April 24, 1990, and April 28, 1990, with applicable antidumping duty at the rate of 60.66. The protest should be GRANTED IN FULL.
Consistent with the decision set forth above, you are hereby directed to deny the subject protest. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed by your office to the protestant no later than 60 days from the date of this letter. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, Freedom of Information Act and other public access channels.
Sincerely,
Myles Harmon, Director
Commercial Rulings Division
4
8