DRA-4-OT:RR:CTF:ER
H171176 JLG
Jennifer Tagliaferro
U.S. Customs and Border Protection
Protest and Control
1100 Raymond Boulevard, Suite 402
Newark, NJ 07102
RE: Protest No. 4601-08-100680; Validity of Notice to Redeliver
Dear Ms. Tagliaferro:
The following is our decision regarding the Application for Further Review (“AFR”) of Protest number 4601-08-100680, filed by counsel on behalf of Seven Star Trading Import and Export (“Seven Star” “protestant”). Seven Star protests the Notice to Mark and the Notice to Redeliver issued by U.S. Customs and Border Protection (“CBP”).
FACTS:
On November 12, 2007, a shipment of merchandise imported and entered by Seven Star under entry number AH3-xxxx587-7, arrived at the port of New York/Newark from China. The entry/immediate delivery (CBP Form 3461) and entry summary (CBP Form 7501), describe the merchandise as 1500 cartons of “detergent.” The commercial invoice, bill of lading, and packing list describe the merchandise as “washing powder.” The CBP Form 7501 lists the country of origin as Mexico and the country of export as China. According CBP officials at the port, the entry included three different types of detergent: Ariel Oxi Azul, Ariel Downy, and Roma. The CBP Form 6051D indicates that on December 11, 2007, CBP detained the entry for examination for a potential IPR violation. On December 18, 2007, Seven Star was notified that a shipment of “Ariel detergent” had been detained pursuant to 19 U.S.C. § 1499 and 19 C.F.R. § 151.16(c), for “other agency requirements.”
Subsequently, on December 26, 2007, CBP issued a Notice to Mark (CBP Form 4647) instructing Seven Star that 1500 cartons of “Ariel Oxi Azul Detergent” did not have the correct country of origin requirements. The CBP Form 4647 further stated that the merchandise must be appropriately marked to comply with the U.S. Fair Packaging and Labeling Act, the U.S. Federal Hazardous Substances Act, and the Federal Trade Commission Marking Requirements. Counsel for Seven Star submitted a letter to CBP, dated January 9, 2008, requesting conditional release of the merchandise to a public warehouse, pursuant to 19 C.F.R. § 134.53, so that Seven Star could examine and remark the merchandise appropriately. Accordingly, the port maintains the merchandise was released to Seven Star on January 23, 2008.
The port advised that on January 17, 2008, it examined samples from the shipment and determined that the “Ariel with Downy” and “Roma” detergents were properly marked and did not involve an IPR violation. Subsequently, on February 1, 2008, CBP determined two of the samples were counterfeit. On February 8, 2008, CBP issued a Notice to Redeliver (CBP Form 4647) instructing Seven Star to redeliver 1,500 cartons of detergent to CBP within 30 days. In Section 15 of the redelivery demand entitled “Remarks/Instructions/Other Action Required of Importer,” the following statement was written: “Merchandise described above must be immediately redelivered to CBP.” No further information was provided. Therefore, the redelivery notice did not provide any legal basis for the redelivery demand.
Assuming the redelivery notice was due to a marking issue, by letter dated February 15, 2008, Seven Star’s counsel requested release of the shipment claiming that the merchandise was appropriately marked at the time of entry. Seven Star stated that the entry consisted of multiple brands of detergent -- Ariel Oxi Azul, Ariel Downy, and Roma -- that were all properly marked. Further, Seven Star stated that only 300 boxes of the imported shipment contained Ariel Oxi Azul, the detergent identified on the redelivery notice, and noted that while the “lettering [on the Ariel Oxi Azul packaging] was not distinct,” the samples and photographs of the merchandise showed that “Made in Mexico” was clearly written on the back of the packaging. Included with this letter were samples of the merchandise and an executed CBP Form 4647 certifying that the imported merchandise was appropriately marked at the time of entry. In March 2008, counsel for Seven Star contacted the port to determine why the merchandise remained subject to redelivery despite the certification confirming the merchandise was properly marked. On March 14, 2008, the port explained to Seven Star’s counsel that the Notice to Redeliver was due to an intellectual property rights violation and not a marking issue. Consequently, on March 26, 2008, Seven Star filed a Protest and AFR challenging the validity of the Notices to Mark and Redeliver, and requested accelerated disposition of the Protest. On April 18, 2008, Seven Star withdrew its request for accelerated disposition of the protest and submitted an amended protest and AFR pursuant to 19 C.F.R. § 174.24 and 19 C.F.R § 174.25.
It should be noted that on April 15, 2008, before the amended protest and AFR was submitted, the port issued a Request for Information (CBP Form 28) instructing Seven Star to provide the actual manufacturer ID, name, and address of the manufacturer. On April 21, 2008, the protestant responded to the Request for Information with pages from Wikipedia stating that Ariel laundry detergent is made by P&G. The protestant also included pages from the website www.business.com which provided the address of P&G in Mexico. Subsequently, on May 9, 2008, CBP issued a Notice of Penalty or Liquidated Damages (CBP Form 5955A) for Seven Star’s failure to redeliver the goods to CBP. The entry liquidated on December 5, 2008, and CBP did not assess any marking duties at the time of liquidation.
ISSUES:
Whether the Notice to Redeliver was legally sufficient.
LAW AND ANALYSIS:
As an initial matter we note that Seven Star timely filed its protest, within 180 days of the Notice to Redeliver. See 19 U.S.C. § 1514(c). A decision on the demand for redelivery of merchandise to CBP’s custody is protestable under 19 U.S.C. § 1514(a)(4). In addition, we determine Seven Star’s protest involves questions of law or fact not previously ruled upon by CBP. Namely, we must consider whether the Notice of Redelivery issued to the protestant is legally sufficient. Accordingly, further review is warranted pursuant to 19 C.F.R. §§ 174.24(b) and 174.26(b)(1)(iv).
Seven Star maintains that the Notice to Redeliver should be cancelled because it provides the incorrect description and quantity of merchandise, and fails to state the basis for redelivery. Based on our review, we determine that the Notice to Redeliver was inadequate as it did not provide the reasons that redelivery was required. Although neither the statute nor regulations specify what constitutes sufficient notice of redelivery, CBP’s regulations do set some guidelines.
CBP regulations governing the redelivery of merchandise are found in 19 C.F.R. § 141.113 and 19 C.F.R. § 113.62. Section 141.113(d) states as follows:
Other merchandise not entitled to admission. If at any time after entry the port director finds that any merchandise contained in an importation is not entitled to admission into the commerce of the United States for any reason not enumerated in paragraph (a), (b), or (c) of this section [relating to marking and labeling requirements and country of origin determinations], he shall promptly demand the return to CBP custody of any such merchandise which has been released.
19 C.F.R. 141.113(d). Entry bond conditions set forth at 19 CFR § 113.62(d) similarly provide that the principal will timely redeliver merchandise conditionally released from CBP custody that:
Fails to comply with the laws or regulations governing admission into the
United States;
(2) Must be examined, inspected, or appraised as required by 19 U.S.C. 1499; or
(3) Must be marked with the country of origin as required by law or regulation.
See 19 C.F.R § 113.62(d). The regulations further provide that a demand for redelivery is timely if it is issued no more than 30 days after the release of merchandise by CBP (if no CBP Form 28 is issued), or a different conditional release period is established, or if released after liquidation of the entry covering the subject merchandise has become final. See 19 C.F.R § 113.62(d); and 19 C.F.R §141.113(h). In this case, the merchandise was released to Seven Star on January 23, 2008, and CBP filed the redelivery demand on February 8, 2008, which was before liquidation became final. Accordingly, the Notice to Redeliver was timely issued.
While there is no statutory or regulatory provision regarding the adequacy of a redelivery notice, CBP has previously determined that a Notice to Redeliver must contain sufficient information to enable the importer to protest the demand for redelivery. See C.S.D. 85-22, 19 Cust. B & Dec. 536 (Sept. 19, 1984). In that ruling, CBP analogized a redelivery notice to a notice of a denial of a protest stating that both have the same purpose; to apprise the importer of the basis for redelivery so that the importer can invoke the appropriate laws in seeking administrative relief. Further, CBP held that a sufficient Notice for Redelivery includes: the entry number, entry date, a description of the merchandise that is to be redelivered, and the reason for redelivery. Id.; see also, HQ 225028 (March 14, 1994) (explaining that “a redelivery notice is required to contain enough information to enable the importer to protest the demand for redelivery”). In this case, the Notice to Redeliver did not provide any basis for redelivery. The notice instructed Seven Star to redeliver 1500 cartons of Ariel Oxi Azul detergent within 30 days from February 8, 2008, the date of the redelivery notice. Box 9 on CBP Form 4647 did not indicate the statute or regulations violated because it was left blank, and Box 15 stated only that the merchandise was to be redelivered to CBP. Consequently, Seven Star could not properly seek administrative relief or take corrective action. Therefore, the Notice to Redeliver is legally insufficient.
As concerns Seven Star’s arguments concerning the sufficiency of the Notice to Mark, we note that CBP did not assess any country of origin marking duties or penalties when the entry liquidated. Accordingly, any arguments regarding the Notice to Mark are moot.
Lastly, Seven Star maintains that the Notice of Detention is insufficient because it fails to include the requisite information proscribed by the applicable statute and regulations. While it is not clear whether Seven Star actually seeks to protest the Notice of Detention, we note that because the merchandise was released from CBP custody on January 23, 2008, any arguments regarding the Notice of Detention are moot.
HOLDING:
Consistent with the decision set forth above, we find that CBP failed to meet the notice requirements to demand redelivery. Therefore, you are hereby directed to ALLOW the protest with regard to the legal sufficiency of the Notice to Redeliver.
In accordance with Sections IV and VI of the CBP Protest/Petition Processing Handbook (HB 3500-08A, December 2007, pp. 24 and 26), you are to mail this decision to counsel for the protestant, together with the Customs Form 19, 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 International Trade will make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.
Sincerely,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division