LIQ 4-01, 4-02
OT:RR:CTF:ER
H302524 CC
Center Director
Industrial and Manufacturing Materials
Center of Excellence and Expertise (CEE)
U.S. Customs and Border Protection
JFK Airport, Bldg. #77
Jamaica, N.Y. 11430
Attn: Joanne Tesoriero, Supervisory Import Specialist
Re: Application for Further Review of Protest number 1703-2016-100470; Multilayered Wood Flooring from the People’s Republic of China; Antidumping and Countervailing Duties; Complete Flooring Supply Corporation
Dear Center Director:
This is in response to the application for further review (“AFR”) of Protest Number 1703-2016-100470 forwarded to our office on January 28, 2019. The protesting party is Complete Flooring Supply Corporation (“CFS”), the importer of record on the relevant entries and self-described “wholesale distributor of high-end affordable hard surface flooring.” CFS protests the liquidation and assessment of antidumping duties (“ADs”) and countervailing duties (“CVDs”) plus interest with respect to 125 entries of wood flooring products.
FACTS:
From January 2, 2013 to November 27, 2013, Protestant CFS entered 120 entries of wood flooring. According to records in CBP’s Automated Commercial Environment (“ACE”) and other documents filed by CFS, the entries listed the PRC as the country of origin and exporting country and commercial invoices show that CFS purchased the merchandise from Shanghai Lairunde. In addition, the manufacturer’s identification code (“MID”) listed on the entries was associated with Shanghai Lairunde. All entries listed an AD case number of A-570-970-062, the case number the Department of Commerce (“Commerce”) assigned when Shanghai Lairunde was both exporter and producer. All entries also included the CVD case number C-570-971-000.
From December 4 to 26, 2013, CFS entered an additional five entries of wood flooring that also listed the PRC as the country of origin and exporting country, included AD case number A-570-970-062 and CVD case number C-570-971-000, and listed a MID associated with Shanghai Lairunde.
On September 9 and 16, 2016, CBP liquidated Protestant’s 120 entries at the AD rate of 13.74 percent and CVD rate of 1.38 percent.
On December 28, 2016, CFS filed the instant protest protesting the liquidation of the 125 entries described above. On the last page of their Memorandum in support of the protest, CFS alleged that “the calculation of duties and interest owed on some of the subject entries, as presented in bills issued to CFS by CBP, in [sic] incorrect.” CFS did not indicate that the calculations on “all” of the subject entries were incorrect, only that calculations on “some of the subject entries” were incorrect. CFS also did not identify which of the 125 entries protested were correctly or incorrectly calculated or how CBP had allegedly miscalculated the duties and interest owed. CBP requested, through CFS’ counsel, that CFS identify the entries and the errors specifically. CFS declined to do so.
On May 3, 2019, CBP liquidated Protestant’s five December 2013 entries and assessed antidumping duty of 17.37 percent and CVD at 1.38 percent of the entered value.
Antidumping Case A-570-970
In December 2011, the U.S. Department of Commerce (“Commerce”) published an AD order for case number A-570-970, Multilayered Wood Flooring From the People’s Republic of China: Amended Final Determination of Sales at Less Than Fair Value, 76 Fed. Reg. 76,690 (December 8, 2011). Entries of multilayered wood flooring (“MLWF”) from the People’s Republic of China (“PRC”) produced and exported by Shanghai Lairunde Wood Co., Ltd. (“Shanghai Lairunde”), were assigned a weighted-average dumping margin of 3.30 percent. Id. at 76,693. Commerce sent CBP Message No. 1349303 on December 15, 2011, which included instructions to CBP to collect cash deposits of 3.30 percent for entries of MLWF exported and produced by Shanghai Lairunde.
In July 2015, Commerce completed its final determination in case A-570-970 and published Multilayered Wood Flooring From the People's Republic of China: Final Results of Antidumping Duty Administrative Review and Final Results of New Shipper Review; 2012-2013, covering the period from December 1, 2012, through November 30, 2013. 80 Fed. Reg. 41,476 (July 15, 2015). As part of the final result determination of its administrative review, Commerce assigned a 13.74 percent weighted-average dumping margin to entries of MLWF exported by Shanghai Lairunde during the period of review. Id. at 41,478.
On August 7, 2015, in accordance with its July 15, 2015, final result determination, Commerce issued Message No. 5219301 for A-570-970, which included instructions that liquidate entries covering shipments of MLWF from the PRC exported by Shanghai Lairunde and entered, or withdrawn from warehouse, for consumption during the period December 1, 2012, through November 30, 2013, and CBP assess an antidumping liability equal to 13.74 percent of the entered value of subject merchandise.
CVD Case C-570-971
In May 2016, Commerce completed its administrative review in C-570-971 and published Multilayered Wood Flooring From the People's Republic of China: Final Results and Partial Rescission of Countervailing Duty Administrative Review; 2013 for the period of review from January 1, 2013, through December 31, 2013. 81 Fed. Reg. 32,291 (May 23, 2016). As part of its final results determination, Commerce assigned to Shanghai Lairunde as a producer/exporter a final 1.38 percent net subsidy rate. Id. at 32,293.
On July 20, 2016, following its final results determination, Commerce sent CBP Message No. 6202303 for case C-570-971, which included instructions that CBP liquidate all shipments of MLWF from the PRC entered or withdrawn from warehouse, for consumption on or after January 1, 2013, and on or before December 31, 2013, produced/exported by Shanghai Lairunde, at a 1.38% subsidy rate of the entered value.
ISSUE
Whether CBP liquidated the entries entered by CFS in accordance with Commerce’s instructions.
LAW AND ANALYSIS
As an initial matter, we note that the liquidation of the 120 entries entered by CFS between January and November 2013 is a protestable matter under 19 U.S.C. § 1514(a)(5) and 19 C.F.R. § 174.11(b)(5). In this case, CBP liquidated those entries on September 9, 2016, or September 16, 2016. CFS timely filed the protest with respect to the 120 entries on December 28, 2016, 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). The Center of Excellence and Expertise for Industrial and Manufacturing Materials 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).
However, CFS’ may not protest liquidation of the five entries it entered in December 2013, before the date of liquidation of those entries. Subsection 1514(c)(3) of Title 19 U.S.C. sets forth unambiguous rules for when a protest may be filed:
[a] protest of a decision, order, or finding described in subsection (a) shall be filed with the Customs Service within 180 days after but not before—
date of liquidation or reliquidation, or
(B) in circumstances where subparagraph (A) is inapplicable, the date of the decision as to which protest is made.
19 U.S.C. § 1514(c)(3) (emphasis added). Thus, the statute prohibits a protest from being filed before the date of liquidation or reliquidation or the date of a CBP decision. Id. § 1514(c)(3)(A).
In this case, CFS filed its protest on December 28, 2016, before the liquidation of the December 2013 entries on May 3, 2019 and the language of 19 U.S.C. § 1514(c)(3)(A) provides that CFS cannot protest with respect to those five entries. Accordingly, we do not address these entries.
Another preliminary matter is contained in CFS’ Memorandum filed in support of their protest (“Memorandum”) is their request that the protest be suspended pending resolution of a November 28, 2016 request for a scope determination from Commerce, i.e., that the “Scope of the Orders is Not Intended to Include Merchandise Contained in the Subject Entries, and AD/CVD is Therefore Not Owed.” We note that this request is moot because on March 31, 2017, Commerce issued its final determination that the wood flooring products which CFS imports from the PRC are within the scope of the AD and CVD orders on MLWF from the PRC. See Final Scope Ruling on the Antidumping and Countervailing Duty Orders on Multilayered Wood Flooring from the People’s Republic of China: Request by Complete Flooring Supply Corporation; see also Notice of Scope Rulings, 83 Fed. Reg. 26,257, 26,258 (June 6, 2018). As soon as Commerce issued its final determination in CFS’ scope ruling request, CBP had no reason to suspend this protest.
CFS also asserts in their Memorandum that their protest should be suspended pending resolution of a FOIA request for liquidation worksheets. CBP does not have statutory or regulatory authority to suspend a protest pending a FOIA request or appeal. Generally, 19 U.S.C. § 1515 provides the statutory authority for CBP to review protests filed under 19 U.S.C. § 1514. Section 1515 does not give CBP the authority to stay or suspend a protest pending a FOIA request or appeal. Id. Likewise, CBP protest regulations in Part 174 of Title 19 of the C.F.R. do not provide CBP the authority to suspend action on a protest pending a FOIA request. See 19 C.F.R. §§ 174.0–174.32. Even with respect to rulings, CBP’s regulatory authority only provides that CBP will not issue a ruling when there is pending litigation before the CIT or U.S. Court of Appeals for the Federal Circuit. 19 C.F.R. § 177.7(b).
Accordingly, CFS’ request to suspend action on this protest pending its FOIA request must be denied, because, as we stated in HQ 966932, dated March 10, 2004, “there is no provision under which CBP has the authority to ‘stay’ or suspend action on a protest pending the receipt of a response to a request under the Freedom of Information Act (‘FOIA’).” Therefore, CBP “do[es] not have the authority to suspend action” on a protest for a pending FOIA request. Id. In sum, the protest should not be suspended pending resolution of a FOIA request for liquidation worksheets.
Whether CBP liquidated the entries entered by CFS in accordance with Commerce’s instructions and correctly calculated duties and interest owed.
In their Memorandum supporting their protest, CFS alleges that “the calculation of duties and interest owed on some of the subject entries, as presented in bills issued to CFS by CBP, in [sic] incorrect.” (Emphasis added). However, this allegation is inherently ambiguous, as CFS does not state that “all” of the subject entries were incorrect, only that an unknown “some” were incorrect. In their Memorandum and subsequent communications with their Counsel, CFS failed to identify the entries which allegedly had duties and interest that were incorrectly calculated or specify how CBP had erred in its calculations.
The protest statute requires that at a minimum:
A protest must set forth distinctly and specifically-
(A) each decision described in subsection (a) as to which protest is made;
(B) each category of merchandise affected by each decision set forth under paragraph (1);
(C) the nature of each objection and the reasons therefor; and
(D) any other matter required by the Secretary by regulation.
19 U.S.C. § 1514(c)(1) (emphasis added). CBP regulations implement § 1514(c)(1) by explicitly requiring that a protest include “the nature of, and justification for the objection set forth distinctly and specifically with respect to each category, payment, claim, decision, refusal.” 19 C.F.R. § 174.13(a)(6); see HQ 965790 (Oct. 25, 2002). When acting on a protest, Customs lacks the legal authority to assume facts and arguments that are not presented by a protestant and, therefore, not in the official record.
In this case, CFS timely made its protest against the liquidation of 120 of the entries, but has not provided the justification required by 19 U.S.C. § 1514(c)(1) and 19 C.F.R. § 174.13(a)(6) for its objection that “the calculation of duties and interest owed on some of the subject entries, as presented in bills issued to CFS by CBP, in [sic] incorrect.” Counsel for CFS has not adequately supported these claims by any evidence and has not offered any other justification for the objection to the liquidations or subsequent calculations of duties and interest owed on Protestant’s entries.
Protestant also asserts in their Memorandum that “CFS Reasonably Relied on Posted Rates at Time of Entry, and the Substantial Increase in Rates at Liquidation Unfairly Impacts CFS’s Business.” Aside from the fact that CFS cites no legal authority in support of this argument, it also reflects a lack of understanding of CBP’s limited role in enforcing the AD and CVD laws.
While both CBP and Commerce play a part in the enforcement of the AD laws, Congress gave them separate and distinct roles. Pursuant to 19 U.S.C. § 1673 and Commerce regulations, Commerce calculates and determines the AD rate and then directs CBP to collect the estimated duties. See 19 U.S.C. §§ 1673d(b), 1673e(a)(1); 19 C.F.R. § 351.12(b)(1). In contrast to Commerce’s primary role in enforcing the AD laws, “CBP’s role in assessing antidumping duties is ministerial. CBP only liquidates entries pursuant to Commerce’s instructions.” HQ H097501 (July 14, 2014). 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)).”
CBP executes its ministerial role in the collection of AD/CVD duties by following Commerce’s instructions to compute and collect duties by applying rates set by Commerce. The AD laws do not provide CBP with any role in evaluating whether an importer reasonably relied on posted rates at time of entry or in determining whether an increase in rates ordered by Commerce at liquidation is “unfair.” “[CBP] merely follows Commerce's instructions in assessing and collecting duties. [CBP] does not determine the ‘rate and amount’ of antidumping duties under 19 U.S.C. § 1514(a)(2).” Mitsubishi, 44 F.3d at 977. These principles apply equally to the liquidation of CVDs as they are part of the same statutory scheme as ADs. Title VII of the Tariff Act of 1930, added by the Trade Act of 1979, Pub. L. No. 96-39, Title I § 101, 93 Stat. 144, 150 (July 26, 1979).
With respect to CFS’ AD entries entered from December 1, 2012, through November 30, 2013, to the extent that CBP liquidated the entries in accordance with the identified Commerce instructions, the liquidation is correct. On August 7, 2015, Commerce sent to CBP Message No. 5219301, which included instructions to CBP to assess an antidumping liability equal to 13.74 percent of the entered value of subject merchandise for all shipments of MLWF from the PRC exported by Shanghai Lairunde and entered, or withdrawn from warehouse, for consumption during the period December 1, 2012, through November 30, 2013.
Commerce Message No. 5219301 applied to CFS’ entries, as they were entries of MLWF from the PRC exported by Shanghai Lairunde and entered, or withdrawn from warehouse, for consumption during the period of December 1, 2012 through November 30, 2013. On September 9, 2016, CBP liquidated some of the entries entered by CFS between January 2, 2013, and November 30, 2013, and others on September 16, 2016, all at an AD rate of 13.74 percent--the rate listed in Commerce’s instructions in liquidation instructions Message No. 5219301.
Similar facts apply to CFS’ CVD entries entered during the period of review from January 1, 2013, through December 31, 2013. On July 20, 2016, Commerce sent CBP Message No. 6202303 for case C-570-971, which included instructions to CBP to liquidate all shipments of MLWF from the PRC, entered or withdrawn from warehouse, for consumption on or after January 1, 2013 and on or before December 31, 2013, by Shanghai Lairunde, at a 1.38% subsidy rate of the entered value. Message No. 6202303 applies to CFS’ entries because CFS imported shipments of MLWF from the PRC, entered or withdrawn from warehouse for consumption on or after January 1, 2013 and on or before December 31, 2013, produced/exported by Shanghai Lairunde. Accordingly, CBP liquidated the 120 entries in accordance Commerce’s instructions in Message No. 6202303.
HOLDING:
CBP liquidated the entries entered in accordance with Commerce’s instructions. Accordingly, Protest 1703-2016-100470 should be DENIED.
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, together with the CBP Form 19, to the Protestant no later than 60 days from the date of this letter. Sixty days from the date of the decision, the Office of International Trade, Regulations and Rulings, 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,
Craig T. Clark, Director
Commercial and Trade Facilitation Division