OT:RR:CTF:ER H097501 GGK
Port Director
U.S. Customs and Border Protection
2350 N. Sam Houston Parkway East
Suite 1000
Houston, TX 77032
Attn: Laura Webb, Supervisory Import Specialist
Re: Application for Further Review of Protest No. 5309-10-100013
Dear Port Director:
This letter is in response to the Application for Further Review (“AFR”) of Protest Number 5309-10-100013, filed on behalf of American Home Assurance Company (“AHAC”). Our decision follows.
FACTS:
The subject merchandise for Entry xxx-xxxx308-3 (“Entry 308-3”) was crawfish tail meat, classified under subheading 0306.19.0010, HTSUS. According to the Entry and Application for Immediate Delivery (CBP Form 3461), filed with Customs and Border Protection (“CBP”) on February 9, 2001, the merchandise arrived at the Port of Huntington Beach, California on January 11, 2001, and was transported under a transportation entry to the destination port, the Port of Houston.
After the merchandise arrived at the Port of Houston, the importer of record, American Coast Processing Enterprise Corporation (“American Coast”), filed the Warehouse Entry (entry type 21) and Entry Summary (CBP Form 7501) for Entry 308-3 on February 9, 2001. According to the February 9, 2001 Entry Summary, the warehouse entry was secured by a continuous bond issued by a surety other than AHAC (the “Continuous Bond Surety”). This Entry Summary described the merchandise as freshwater crawfish pellets classified under subheading 0306.19.0010, Harmonized Tariff Schedule of the United States (“HTSUS”).
The Port of Houston subsequently determined that the merchandise was subject to antidumping duties (“ADD”) covering freshwater crawfish tail meat from China, Antidumping Duty Order A570-848-023. See Message No. 8365208, dated December 30, 2008. The notations also indicate the applicable ADD rate. Subsequently, on March 16, 2001, American Coast filed a single transaction bond (Bond No. WA906382704682, or the “STB”), executed by AHAC on March 2, 2001, for Entry xxx-xxxx270-4 (“Entry 270-4”) to insure payment for all duties, taxes, and fees owed. The second entry number, i.e., Entry 270-4, was generated in accordance with CBP procedures in order to identify the warehouse withdrawal transaction described below. Thus, the merchandise described in Entry 270-4 is the same merchandise described in Entry 308-3. The STB identifies the warehouse withdrawal as the transaction secured by the bond and indicates that the bond obligates the importer and AHAC to ensure the performance of all the conditions of the basic importation and entry bond described in 19 C.F.R. § 113.62.
On March 16, 2001, American Coast filed a second CBP Form 7501 for the shipment, designated Entry 270-4, in order to withdraw the merchandise from the warehouse. That warehouse withdrawal indicates the merchandise was subject to antidumping duties; reports the same net quantity of crawfish tail meat described in the original warehouse entry; cross-references the warehouse entry (Entry 308-3) by entry number; identifies the same ultimate consignee and importer of record (American Coast); and identifies both sureties (i.e., the Continuous Bond Surety and AHAC) by surety code.
The U.S. Department of Commerce (“Commerce”) published the antidumping duty order in this case in the Federal Register on September 15, 1997. See Notice of Amendment to Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Freshwater Crawfish Tail Meat from the People’s Republic of China, 62 Fed. Reg. 48,218 (Sept. 15, 1997). On September 29, 2000, the exporter of the merchandise in AHAC’s protest, China Kingdom Import & Export Co., Ltd. (“China Kingdom”), requested a new shipper administrative review of its shipments. See Freshwater Crawfish Tail Meat From the People’s Republic of China: Initiation of New Shipper Antidumping Administrative Review, 65 Fed. Reg. 66,525 (Nov. 6, 2000) (“Initiation of New Shipper Review”). In that notice, Commerce stated:
Concurrent with the publication of this initiation notice, we will instruct the U.S. Customs Service to allow, at the option of the importer, the posting of a bond or security in lieu of a cash deposit for each entry of the merchandise exported by the companies listed above, until the completion of the review.
Initiation of New Shipper Review, 66 Fed. Reg. at 66,525.
Commerce completed its new shipper review on September 27, 2001. See Freshwater Crawfish Tail Meat From the People’s Republic of China: Amended Final Results of Antidumping Duty New Shipper Reviews, 66 Fed. Reg. 49,343 (Sept. 27, 2001) (“Amended Final Results of New Shipper Reviews”). In that notice, Commerce stated:
Furthermore, the following deposit requirements will be effective upon publication of this notice of amended final results of antidumping new shipper reviews for all shipments of freshwater crawfish tail meat from the PRC entered, or withdrawn from warehouse, for consumption on or after the date of publication, as provided by section 751(a)(2)(C) of the Act: (1) The cash deposit rates for the reviewed companies will be the rates shown above. . . . These deposit requirements shall remain in effect until publication of the final results of the next administrative review.
On September 28, 2001, China Kingdom requested a review of its shipments, which Commerce initiated on October 23, 2001. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Requests for Revocation in Part, 66 Fed. Reg. 54,195 (Oct. 26, 2001) (“Initiation of Administrative Review Notice”). On April 23, 2003, Commerce published the final results of the administrative review in the Federal Register. See Freshwater Crawfish Tail Meat from the People’s Republic of China; Notice of Final Results of Antidumping Duty Administrative Review, 68 Fed. Reg. 19,504 (Apr. 21, 2003).
After litigation on the administrative review concluded, Commerce published the notice of the amended final results. See Crawfish Tail Meat from the People’s Republic of China: Amended Final Results of the Administrative Review Pursuant to Final Court Decision, 73 Fed. Reg. 74,457 (Dec. 8, 2008) (stating that Commerce would “instruct [CBP] to liquidate entries of freshwater crawfish tail meat from the People’s Republic of China during the review period at the assessment rate the Department calculated for the final results of review as amended.”). Subsequently, on December 30, 2008, Commerce issued Message No. 8365208 noting that the lifting of the suspension of liquidation of entries of the subject merchandise occurred with the publication of the Federal Register notice on December 8, 2008.
On January 15, 2009, CBP issued a Notice of Action (CBP Form 29) to American Coast. That notice informed American Coast that CBP had been instructed by Commerce to liquidate Entry 308-3 with antidumping duties at the applicable rate. The Port of Houston subsequently liquidated the entry on February 20, 2009. According to the Automated Commercial System (“ACS”) report, Formal Demand on Surety for Payment of Delinquent Amounts Due (i.e., ACSR-CL-612, or the “612 Report”), CBP changed the surety billed to AHAC on September 30, 2009. AHAC first received notice of the bill when the CBP National Finance Center (“NFC”) mailed the 612 Report on October 21, 2009, for the outstanding balance of duties and interest owed for the subject importation. AHAC protested that bill on December 30, 2009, arguing, inter alia, that the subject entries were deemed liquidated, that the statute of limitations for collecting under AHAC’s bond expired, that CBP improperly assessed interest, and that CBP improperly calculated the amount of antidumping duties owed. The port sought guidance regarding the question of whether the protest should be suspended pending resolution of litigation before the U.S. Court of International Trade (“CIT”) involving payments to affected domestic producers under the Continued Dumping and Subsidy Offset Act of 2000 (“CDSOA”). The port forwarded the protest to this office for further review on February 23, 2010.
ISSUES:
Whether the subject entries were deemed liquidated;
Whether the statute of limitations for collection against AHAC’s STB has expired;
Whether CBP properly assessed interest;
Whether payment under the CDSOA to affected domestic parties is a breach of the surety contract;
Whether CBP billed the proper surety; and
Whether CBP properly calculated the amount of antidumping duties owed.
LAW AND ANALYSIS:
We note initially that the instant Protest was timely filed pursuant to 19 U.S.C. § 1514 (2001), i.e., within 90 days from the date of mailing to the surety of the notice of the demand for payment. Under 19 U.S.C. § 1514(a), “decisions of [CBP], 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.” Furthermore, pursuant to 19 U.S.C. § 1514(c)(3) (2001): “A protest by a surety which has an unsatisfied legal claim under its bond may be filed within 90 days from the date of mailing of notice of demand for payment against its bond.” In this case, because AHAC filed its protest within 90 days of the mailing of the 612 Report, the protest is timely.
AHAC argues that further review is warranted because the decision against which the protest was filed involves questions of law or fact that have not been ruled upon by the Commissioner of CBP or his designee, or by the customs courts, which is one of the criterion for further review under 19 C.F.R. § 174.24(b). Your office recommended further review because the protest involves questions fact that have not previously been ruled upon, per 19 C.F.R. §§ 174.24(b) and 174.26(b)(1). Because the decision against which the protest was filed raises issues fact that have not been previously ruled upon by the CBP Commissioner, his designee, or the customs courts we determine further review is warranted.
1. Deemed Liquidation
The first issue raised by AHAC is whether the failure of CBP to provide notice to AHAC of the suspension of liquidation caused the entries to be deemed liquidated, i.e., “liquidated by operation of law.” AHAC argues that CBP was required to provide notice of suspension of liquidation to each surety that executes a bond for the importer of record. Furthermore, AHAC asserts, because CBP failed to provide such notice, the underlying entries were liquidated by operation of law under 19 U.S.C. § 1504(c).
The Government is directed by statute to give notice of the suspension of liquidation. 19 U.S.C. § 1504(c) (2000) provides:
If the liquidation of any entry is suspended, the Secretary shall by regulation require that notice of the suspension be provided, in such manner as the Secretary considers appropriate, to the importer of record or drawback claimant, as the case may be, and to any authorized agent and surety of such importer of record or drawback claimant.
19 U.S.C. § 1504(c). The applicable regulation, 19 C.F.R. § 159.58(a), requires that the port director “shall immediately notify the importer, consignee, or agent of each entry of merchandise in question with respect to which liquidation is suspended.” In the instant protest, notice relating to this entry was sent on CBP Form 4333A to the importer of record and the Continuous Bond Surety. However, a CBP Form 4333A was not provided to AHAC for the STB for this entry. Regardless, the fact that AHAC did not receive a CBP Form 4333A from CBP does not invalidate the suspension of liquidation nor cause a deemed liquidation.
To explain, we first note that the notice requirement in 19 U.S.C. § 1504(c) is a statutory procedural requirement, which does not include any expressed consequences for violations of the requirement. The courts have held that "[a]n agency's violation of a statutory procedural requirement does not necessarily invalidate the agency action, especially where Congress has not expressed any consequences for such a procedural violation." Diaz v. Dep't of Air Force, 63 F.3d 1107, 1109 (Fed. Cir. 1995). The Supreme Court has said: "We would be most reluctant to conclude that every failure of an agency to observe a procedural requirement voids subsequent agency action, especially when important public rights are at stake." Brock v. Pierce Cnty., 476 U.S. 253, 259-60, 106 S. Ct. 1834, 90 L. Ed. 2d 248 (1986). “No more should Customs’ procedural error, in failing to provide a statutorily required notification, necessarily invalidate a suspension of liquidation that, like the suspension here, occurred automatically by operation of law.” Great American Insurance Co. of NY v. United States, 738 F.3d 1320, 1329 (Fed. Cir. 2013). Thus, CBP’s failure to provide notice of the suspension of liquidation to AHAC does not necessarily invalidate the suspension of liquidation for the entries at issue and require the entries to be deemed liquidated. Rather, as explained by the Court of Appeals for the Federal Circuit in Great American Insurance Co. of NY, the rule of prejudicial error under the Administrative Procedure Act must be applied and AHAC must demonstrate that it suffered substantial prejudice as a result of CBP’s procedural error before the suspension attached to the entries can be invalidated. See 738 F.3d at 1329-30 (holding that CBP’s failure to provide a notice of suspension of liquidation pursuant to 19 U.S.C. § 1504(c) will only invalidate the suspension if the surety can demonstrate that CBP’s error caused it substantial prejudice) (internal citations omitted).
To determine whether AHAC suffered substantial prejudice as a result of CBP’s failure to provide a notice of the suspension of liquidation, we find the case Great American Insurance Co. of NY to be instructive. In Great American Insurance Co. of NY, the Federal Circuit addressed a factual situation almost identical to the one presented in this case, in that CBP also failed to provide notice pursuant to 19 U.S.C. § 1504(c), to the surety. Id. at 1324. In deciding the case, the Federal Circuit emphasized that the surety had, in fact, already received notice of the suspension of liquidation for the protested entries. Id. at 1331. Specifically, the court explained that, “each of the bonds in question include[d] on its face a code indicating that the covered entries were subject to an antidumping duty order. Id. In addition, notice of the initial and continued suspension of liquidation of entries covered by the order was repeatedly published in the Federal Register, years before the publication of the final results of the administrative review.” Id. (internal citations omitted). Thus, the procedural notice required under 19 U.S.C. § 1504(c) constituted additional notice to the surety. Because the surety already received notice, the Federal Circuit in Great American Insurance Co. of NY reasoned that the surety must have specific evidence that it would have taken a different action for this entry had it received the additional notice required by 19 U.S.C. § 1504(c). Id. at 1331. Thus, there is a higher bar for a surety to be able to demonstrate that failure to provide an additional notice under section 1504(c) created sufficient prejudice to relieve it from its obligations under the bond when it was already on notice that the bond covered an entry subject to an antidumping duty order.
Rather than providing specific evidence of substantial prejudice, however, the surety in Great American Insurance Co. of NY broadly asserted that “had it gotten such a notice, it could have sought reinsurance, ceased doing business with the importer to limit its future risk, or attempted to minimize its loss on these bonds by participating in the administrative review of the duties at issue and arguing for a lower rate for the entries covered by the bonds.” Id. The Federal Circuit discounted these broad assertions by first noting that the surety had never participated in past administrative reviews before Commerce or provided evidence that its participation in the review at issue could have altered the outcome of the review. Id. at 1330-31. Moreover, the Federal Circuit noted that the surety had never taken harm-avoiding actions against importers despite having received suspension notices for other entries. Id. at 1331. Thus, there was no evidence that the additional notice would have spurred the surety to take harm-avoiding action against the importer in that case, which would have been a departure from the surety’s historical practice. Id.
Similar to the facts in Great American Insurance Co. of NY, the missing notice of suspension pursuant to 19 U.S.C. § 1504(c) constitutes additional notice to the notices that AHAC already received by means of published public notices of suspension in the Federal Register. See, e.g., Notice of Amendment to Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Freshwater Crawfish Tail Meat From the People’s Republic of China, 62 Fed. Reg. 48,218 (Sept. 15, 1997). Moreover, like the bonds at issue in Great American Insurance Co. of NY, AHAC’s bond in this case also has a Rating Code of 4. According to the rating code key on the face of the bond, that code corresponds to “AD/CVD,” i.e., antidumping or countervailing duties. Therefore, at the time of bond execution, AHAC knew or should have known that the STB secured an entry for merchandise subject to estimated antidumping or countervailing duties. Consequently, there is a higher bar for AHAC to meet before it can demonstrate that CBP’s failure to provide an additional notice under section 1504(c) created sufficient prejudice to relieve it of its obligations under the bond.
Rather than provide evidence of substantial prejudice, however, AHAC broadly asserts that had it received notice under section 1504(c), the company would have participated in the administrative review process before Commerce to seek a lower antidumping duty rate and taken steps to protect its interests, including seeking further assurances or other means of subrogation from the importer. Like the surety in Great American Insurance Co. of NY, however, there is no evidence that AHAC would have participated in the review at issue even with this additional notice.
Finally, AHAC’s broad assertion that it would have sought further assurances or other means of subrogation from the importer if additional notice was received is likewise unsubstantiated by evidence. We note that based on CBP records, AHAC, throughout 2001, issued multiple bonds, continuous and single transaction, to secure at least twelve entries of freshwater crawfish tail meat from the People’s Republic of China imported by American Coast. The single transaction bonds in these other entries secured an amount similar to the single transaction bond at issue in this case. Furthermore, each of these other entries was subject to the same antidumping duty order. More importantly, for at least eight of these other entries, AHAC received notices of suspension pursuant to 19 U.S.C. § 1504(c) from CBP. Despite receiving additional notices for most of these entries, however, AHAC did not present evidence that it sought additional assurances from American Coast. Therefore, there is no evidence that the additional notice under 19 U.S.C. § 1504(c) for this single entry would have spurred AHAC to suddenly take harm-avoiding action against American Coast.
Based on all of the above, AHAC has failed to demonstrate any prejudice that resulted from CBP’s error. Therefore, the suspension of liquidation attached to the entry at issue remains valid. Furthermore, since CBP liquidated the entry within the statutory period upon receiving liquidation instructions from Commerce we determine that the underlying entry was not deemed liquidated.
2. Statute of Limitations
AHAC argues that under the applicable statute of limitations, the time for any collection action against the STB has expired. According to AHAC, the entry at issue liquidated by operation of law one year after the date of entry on February 9, 2002. Pursuant to 28 U.S.C. § 2415, the government’s right to collect additional duties is barred unless a complaint is filed within six years after the right of action accrues. Such a right of action accrues 31 days after the demand for payment was made against the importer of record. Because the government has not initiated a collection action for the subject bill, AHAC asserts that it has no liability under the statute of limitations. Because liquidation and the first demand for payment against the importer of record did not occur until February 20, 2009, the breach of the bond that started the running of the statute of limitations did not occur until 31 days later, and the six-year statute of limitations has not yet expired.
Under 28 U.S.C. § 2415(a), “[E]very action for money damages brought by the United States or an officer or agency thereof which is founded upon any contract express or implied in law or fact, shall be barred unless the complaint is filed within six years after the right of action accrues.” It is the breach of any bond condition that gives the right of action to sue on the bond, such as the bond condition to “pay, as demanded by [CBP], all additional duties, taxes, and charges.” See 19 C.F.R. § 113.62(a)(ii). Generally, “bills for duties, taxes, fees, interest, or other charges are due and payable within 30 days of the date of issuance of the bill.” 19 C.F.R. § 24.3(e). See also 19 U.S.C. § 1505(b) and (d). Thus, the government’s right of action against a surety typically accrues 31 days after issuance of the bill for additional duties, taxes, and charges, if the bill remains unpaid. See United States v. Ataka Am., Inc., 826 F. Supp. 495, 503 (Ct. Int’l Trade 1993) (under prior version of 19 U.S.C. § 1505 that made bills due within fifteen days of issuance, the Court noted the government must sue the surety within six years after the fifteenth day following liquidation). Since bills for unpaid liquidated duties, taxes, and charges are generally issued on the date of liquidation, there can be no breach of the bond obligation to pay the amount of liquidated duty due until the entry is liquidated by posting the notice of liquidation. In this case, the right of action arose 31 days after the first demand on the importer of record (the date of liquidation), i.e., 31 days after February 20, 2009. Therefore, the six-year statute of limitations in this case had not run as alleged by AHAC.
3. Assessment of Interest
Regarding the assessment of pre-liquidation interest, AHAC argues that when the payment of antidumping duties is secured by a bond, interest cannot be collected under the provisions of 19 U.S.C. § 1677g. In support of its position, AHAC relies on Fujitsu General America, Inc. v. United States, 110 F. Supp. 2d 1061 (Ct. Int’l Trade 2000) (noting that, “pursuant to 1677g(a), interest [is] assessable on payments of antidumping duties, but not on instruments serving as security for payments, such as a bond”); and Timken Co. v. United States, 37 F.3d 1470 (Fed. Cir. 1994) (explaining that, “‘amounts deposited’ in section 1677g(a) refers solely to cash deposits of estimated duties provided under sections 1671e(a)(4) [countervailing duty order] and 1673e(a)(3) [antidumping duty order].”). Because no cash deposit was made on the protested entry, AHAC argues that the entry should be reliquidated without interest. As explained below, we determine that because the subject merchandise was entered during the new shipper review of China Kingdom, American Coast was allowed to post a bond rather than a cash deposit, and therefore, interest should not have been assessed until the time of liquidation.
Upon request, Commerce conducts reviews to establish individual weighted-average dumping margins for foreign exporters or producers of merchandise subject to an antidumping duty order who did not export subject merchandise during the period of the investigation and are not affiliated with a producer or exporter who did so. See 19 U.S.C. § 1675(a)(2)(B) (2001). From January 1, 1995, the effective date of the statute authorizing new shipper reviews, until April 1, 2006, the antidumping law permitted “new shippers” to post bonds with CBP in lieu of cash deposits to serve, during the time required to conduct the review, as security for future payment of antidumping duties. See 19 U.S.C. § 1675(a)(2)(B)(iii) (suspended by the Pension Protection Act of 2006, Pub. L. No. 109-280, § 1632(a), 120 Stat. 780, 1165 (2006)).
In this case, American Coast was allowed to post a bond in lieu of making a cash deposit during the new shipper administrative review. During the time required to conduct the new shipper review, between November 6, 2000, and September 26, 2001, the antidumping law permitted importers of crawfish tail meat exported by certain new shippers, including China Kingdom, to post bonds in lieu of making cash deposits to serve as security for the future payment of antidumping duties. Because the crawfish tail meat that is the subject of AHAC’s protest was entered during the new shipper review period, American Coast, as the importer, had the option of not making a cash deposit pursuant to 19 U.S.C. § 1675(a)(2)(B) (2001).
According to Automated Commercial System (“ACS”) records, the port calculated interest owed by American Coast (and AHAC as surety) based on the collection date for Entry 308-3, i.e., March 30, 2001. The courts have conclusively held that 19 U.S.C. § 1677g(a) requires pre-liquidation interest to be assessed only when a cash deposit of estimated antidumping duties is made. See Timken Co. v. United States, 37 F.3d 1470, 1472-73 (Fed Cir. 1994) (noting that “section 1677g(a) applies only to cash deposits of estimated duties”). Because American Coast did not make a cash deposit of antidumping duties, the interest provisions of 19 U.S.C. § 1677g(a) do not apply and AHAC is not liable under its bond for interest on the unpaid antidumping duty prior to the date of liquidation.
By contrast, we find that the port properly assessed interest that accrued after the date of liquidation (i.e., “post-liquidation interest”). Pursuant to 19 U.S.C. § 1505(d), when a bill is not paid in full within 30 days, “any unpaid balance shall be considered delinquent and bear [post-liquidation] interest by 30-day periods.” Therefore, the port properly assessed interest from the date of liquidation, i.e., February 20, 2009, and that interest will continue to accrue until the balance is paid in full.
4. Breach of Surety Contract
AHAC argues that payment under the CDSOA to affected domestic parties is a breach of the surety contract. Specifically, AHAC asserts that the surety bond contract language only requires remittance of duties to the United States, not third party beneficiaries. Furthermore, AHAC claims, payments to affected domestic producers are a material alteration of the bond contract which is prejudicial to the surety. However, as we have previously determined, disbursement of funds collected under the CDSOA to affected domestic parties is not a breach of the surety contract.
In Headquarters Ruling Letter H070919, dated October 14, 2009, we determined that the CDSOA did not change the importer’s obligation to pay the duties it owes, nor did it change the surety’s liability for those duties. The CDSOA did not alter the surety’s contractual liability under the terms of the bond between the importer and the surety, did not expose the surety to any additional risk, and did not alter the payment structure of the bond. Because the issue of payments to third parties under the CDSOA has been previously addressed in H070919, and because AHAC presents no new arguments of fact or law, we determine that this part of the protest may be denied consistent with our holding in H070919.
5. CBP Properly Billed AHAC
AHAC argues that CBP billed the wrong surety. AHAC argues that because the importer of record identified the Continuous Bond Surety as the responsible surety on the entry summary filed for Entry 308-3, which is the entry identified in the demand for payment, AHAC should not be liable for duties related to that entry. AHAC further claims that its liability is limited to duties, taxes and fees associated with Bond No. WA906382704682, the STB that AHAC executed. Because that STB identifies Entry 270-4, AHAC argues that it cannot be liable for duties and fees related to Entry 308-3. In addition, AHAC argues that its STB could not have been issued to cover charges related to Entry 308-3 because that entry had a transaction date that was three weeks before the date of entry for the warehouse withdrawal, Entry 270-4. AHAC also notes that the limit of liability of its bond exceeds the amount of the estimated antidumping duties for Entry 308-3. As discussed below, we determine that AHAC is liable for the duties, taxes, and fees owed under its STB.
In this case, the importer originally entered the merchandise under a warehouse entry (Entry 308-3) on February 9, 2001. While the imported merchandise was still in a warehouse, CBP determined that the merchandise was subject to Antidumping Duty Order A570-848. CBP subsequently required an STB to secure payment of the additional estimated antidumping duties. Consequently, when the importer filed the warehouse withdrawal (Entry 270-4) on March 16, 2001, the CBP Form 7501 filed to withdraw the merchandise properly identified both sureties, i.e., the Continuous Bond Surety and AHAC, by their surety codes. Because AHAC executed the March 2, 2001 STB before the merchandise was withdrawn from the warehouse under an entry for consumption, the STB was effective at the time American Coast filed the warehouse withdrawal (Entry 270-4) and entered the merchandise for consumption.
We note that our conclusion is supported by Headquarters Ruling Letter (“HRL”) 111992, dated April 21, 1992. In HRL 111992, legacy Customs determined that a STB that identified an incorrect entry number could insure a customs transaction provided, the bond could be associated with the transaction through other indicia. In that ruling, the legacy Customs Service held that even though the entry number on the bond was different, the agency could still identify the transaction based on the vessel name, date, parties and a handwritten correction on the bond with the correct entry number. In that case we noted that the correction to the bond was immaterial because it did not go to the substance of the bond or result in its basic revision.
Significantly, the entry summary filed for the warehouse withdrawal (Entry 270-4) cross references the original warehouse entry (Entry 308-3), as well as the surety codes for both sureties, the Continuous Bond Surety and AHAC. In addition, the Automated Commercial System (“ACS”) records for Entry 308-3 identify AHAC by surety code and indicate that the payment of duties for that entry was insured by a bond executed by AHAC in an amount consistent with the amount of AHAC’s STB. Although the amount of the bond exceeds the amount of supplemental duties owed, we note that the STB posted at the time of entry is intended to cover “estimated” duties rather than the exact amount of duties that are assessed at the time of liquidation. To this end, the bond amount matches exactly the estimated duties for Entry 270-4.
Based on the fact that American Coast associated AHAC’s STB with Entry 308-3 in the ACS and entry withdrawal records, the date and amount of the bond correspond to Entry 270-4, and the bond itself identifies Entry 270-4, we determine that AHAC intended to secure the duties, taxes, and fees owed for Entry 308-3. Therefore, AHAC is liable under Bond No. WA906382704682 for charges related to the importation of the merchandise described in Entry 308-3.
6. Calculation of Antidumping Duties
AHAC argues that the port improperly calculated the amount of antidumping duty owed for Entry 308-3. First, AHAC alleges that the port used an incorrect per kilogram amount for the entered value instead of the ad valorem percentage rate (i.e., 90.66%), as indicated by a handwritten notation on the entry summary. AHAC maintains that the port had no basis to use an entered value different from the amount declared by American Coast at the time of entry. In addition, AHAC asserts that the port improperly used the wrong antidumping rate to calculate the amount of antidumping duty.
We determine that the port properly calculated the amount of the antidumping duties owed. Initially, we note that the handwritten notation “123008” on the entry summary refers to the date of Message No. 8365208. That is, the notation reference that the message was issued on 12/30/08, or December 30, 2008, and does not indicate a change in the entered value of the imported merchandise. Thus the entered value for both entries is the same.
The port also applied the proper antidumping duty margin, as determined by Commerce, to the imported merchandise. The liquidation instructions contained in Message No. 8365208, issued December 30, 2008, directed CBP to liquidate the protested entries at a specific rate of duty rather than an ad valorem rate of duty. According to Commerce’s instruction, shipments of freshwater crawfish tail meat from China that were produced by Chaohu Daxin Foodstuff Co. Ltd., exported by China Kingdom Import & Export Co., Ltd., and imported by American Coast were properly assessed. As noted by the Court of Appeals for the Federal Circuit, CBP’s role in assessing antidumping duties is ministerial. CBP only liquidates entries pursuant to Commerce’s instructions. See Mitsubishi Elecs. Am., Inc. v. United States, 44. F.3d 973, 976-77 (Fed. Cir. 1994) (“Customs has a merely ministerial role in liquidating antidumping duties under 19 U.S.C. § 1514(a)(5).”) Consequently, the antidumping duty rate at which the imported crawfish tail meat is assessed is not subject to protest.
HOLDING:
Consistent with the decision set forth above, you are hereby directed to GRANT the protest in part with respect to pre-liquidation interest that was improperly assessed. For all other issues raised, the protest is hereby DENIED. You are to mail this decision to counsel for the inquirer no later than 60 days from the date of this letter. On that date, 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