OT:RR:CTF:EPDR H306804 ND
Center Director
Electronics
Center of Excellence and Expertise
U.S. Customs and Border Protection
1 World Trade Center, Suite 741
Long Beach, CA 90831
Attn: Luis S. Montes, Import Specialist
Re: Application for Further Review of Protest Number 520119100305; Section 301; Time of Entry; 19 C.F.R. § 141.68
Dear Center Director,
The purpose of this decision is to address the application for further review (“AFR”) of protest number 520119100305, filed by Structured Cable Products Inc. (“Structured Cable”) on July 26, 2019, regarding the assessment of duties pursuant to Section 301(b) of the Trade Act of 1974 (“Section 301”).
FACTS:
In July 2018, Structured Cable imported one entry, number XXX-XXXX757-1, of electrical conductors (“conductors”) from the People’s Republic of China (“China”). There is no dispute that Structure Cable’s entry would be subject to the Section 301 duties imposed by the United States Trade Representative (“USTR”) if entered for consumption on or after the effective date of the duties, i.e., August 23, 2018. See 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 (Aug. 16, 2018) (“List 2”). The notice of the imposition of List 2 Section 301 duties provides:
. . . . Products of China that are provided for in new HTSUS heading 9903.88.02, as established by Annex A of this notice that are entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 am Eastern daylight time on August 23, 2018, will be subject to an additional ad valorem duty of 25 percent. The rates of duty applicable to products of China that are provided for in new HTSUS heading 9903.99.02 apply in addition to all other applicable duties, fees, exactions, and charges.
Id.
According to the Automated Commercial Environment (“ACE”), the timeline of events is as follows. An entry summary (CBP Form 7501) was filed and accepted on July 25, 2018, which is also the cargo release date. An entry summary date was subsequently assigned on August 7, 2018, and August 25, 2018. The August 25, 2018, entry summary reflects the assessment of List 2 Section 301 duties. The additional entry summary dates are dates on which CBP modified the existing July 25, 2018, entry summary. A second cargo release was also dated August 25, 2018.
The entry summary submitted by Structure Cable is signed and dated June 18, 2018. Additionally, the entry summary identifies July 26, 2018, as the import and entry date. According to the ACE Cargo Release system, the entry filing date is July 25, 2018, the actual arrival date is July 27, 2018, and the date of release is August 25, 2018. ACE Cargo Release also identifies two bill of lading numbers that correspond to the ACE Cargo/Manifest Query, which indicates that entry XXX-XXXX757-1 contains two shipments, both of which arrived on July 26, 2018. Additionally, Structured Cable’s freight forwarder’s internal manifest notes that the date of release is July 25, 2018, and the arrival date is July 27, 2018. Finally, the document titled “Sea Freight FCL Arrival Notice,” similarly identifies both bill of lading numbers and notes that the merchandise arrived at the Port of Miami on July 25, 2018.
U.S. Customs and Border Protection (“CBP”) liquidated entry XXX-XXXX757-1 assessing a 25% ad valorem rate pursuant to the List 2 Section 301 duties. Structured Cable filed its protest on July 26, 2019, protesting the liquidation and assessment of Section 301 duties on its entry. According to Structured Cable, its entry was entered for consumption prior to the August 23, 2018, effective date of the List 2 Section 301 duties and therefore not subject to Section 301 duties. According to the Port, Structured Cable’s entry was entered for consumption after the effective date of the List 2 Section 301 duties and therefore subject to Section 301 duties.
ISSUE:
What is the legal date of entry of Structured Cable’s entry?
LAW AND ANALYSIS:
It is the opinion of your office that this protest meets the criteria for further review. We agree and are of the opinion that this involves questions of law or fact which have not been ruled upon by the Commissioner of CBP or his designee or by the Customs courts. 19 C.F.R. § 174.24(b).
Pursuant to 19 U.S.C. § 1514(c)(3)(A), a party must file a protest within 180 days after the date of liquidation. CBP liquidated entry XXX-XXXX757-1 on June 21, 2019. Structured Cable filed its protest on July 26, 2019, within 180 days of that liquidation.
The applicability of List 2 Section 301 duties to the merchandise at issue hinges on whether the merchandise was entered for consumption before or after the August 23, 2018, effective date of the List 2 Section 301 duties. See 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 (Aug. 16, 2018). While it is unclear the exact date on which Structured Cable alleges its entry was entered, Structured Cable emphasizes that it filed the entry summary on July 26, 2018, and the vessel arrived within port limits on July 27, 2018. According to Structured Cable, these facts are sufficient to prove that it entered the subject conductors prior to August 23, 2018.
19 U.S.C. § 1315(a) provides for the effective dates of rates of duty. 19 U.S.C. § 1315(a) specifically provides as follows:
(a) Except as otherwise specially provided for, the rate or rates of duty imposed by or pursuant to this chapter or any other law on any article entered for consumption . . . . shall be the rate or rates in effect when the documents comprising the entry for consumption or withdrawal from warehouse for consumption and any estimated or liquidated duties then required to be paid have been deposited with the appropriate customs officer in the form and manner prescribed by regulations of the Secretary of Treasury . . . .
Consequently, the rate applicable to the protested entries is the date on which the entry is filed and estimated duties deposited “[e]xcept as otherwise specially provided for.” Id.
19 C.F.R. § 141.68 is the implementing regulation for 19 U.S.C. § 1315(a). 19 C.F.R. § 141.68 permits importers to select the date of entry for a particular shipment. For example, 19 C.F.R. 141.68(b) provides:
When entry summary serves as entry and entry summary. When an entry summary serves as both the entry documentation and entry summary, in accordance with § 142.3(b) of this chapter, the time of entry will be the time the entry summary is filed in proper form with estimated duties attached . . . .
However, the ability of importers to select a date of entry is subject to the limitation in 19 C.F.R. 141.68(e), which provides:
Merchandise will not be authorized for release, nor will an entry or an entry summary which serves as both the entry and entry summary be considered filed or presented, until the merchandise has arrived within the port limits with the intent to unlade.
Therefore, merchandise is not entered until it arrives at the port, and it is the intent of the importer of record to unlade that merchandise in that port. Accordingly, Structured Cable’s entry of conductors was not entered until the shipments arrived at the port of unlading and with the intent to unlade.
In Headquarters Ruling (“HQ”) H121420 (May 17, 2011), we determined that the date of entry for the automobile tires was the date the tires arrived within port limits. In that case, a Presidential Proclamation authorized additional duties on certain vehicle tires from the PRC. The importer selected the date of entry as the date reflected on the entry summary, which was prior to the imposition of the additional duties. However, pursuant to 19 C.F.R. § 141.68(e), the entry date cannot predate the actual arrival of the merchandise within port limits and any entry summaries are not considered filed until the merchandise arrives at the port of unlading. See also Mussman & Schafer, Inc. v. United States, 27 Cust. Ct. 180 (1951); HQ H121420 (May 17, 2011); HQ 225111 (Oct. 4, 1994). Therefore, we determined that because the actual arrival date of the vessel carrying the automobile tires within port limits was after the effective date of the Presidential Proclamation, the automobile tires were subject to the increased duty rate.
In the instant case, Structured Cable purportedly relies on 19 C.F.R. § 141.68(b) to establish the date of entry. 19 C.F.R. § 141.68(b) permits Structured Cable to use the entry summary filing date as the date of entry so long as estimated duties were attached. ACE reflects that the entry summary was filed and accepted on July 25, 2018. ACE’s acceptance of an entry summary is sufficient evidence that the entry summary was submitted in proper form. Because Section 301 duties were not effective until August 23, 2018, no Section 301 duties were attached to the entry summary. However, the entry date cannot precede the arrival date of the merchandise within port limits with the intent to unlade pursuant to 19 C.F.R. § 141.68(e). According to Structured Cable, the arrival date of the vessel was July 27, 2018, which is therefore the earliest possible entry date. ACE Cargo release indicates that the entry summary was filed on July 25, 2018, and the actual arrival date of the merchandise was July 27, 2018. Structured Cable also provides documentation of its freight forwarder’s manifest that confirms the arrival date is July 27, 2018. ACE Cargo/Manifest Query, though, suggests that the entry contained two shipments that arrived on July 26, 2018.
The most important consideration is that ACE, CBP’s internal system of record, indicates that an entry summary was filed and accepted on July 25, 2018. It is of no consequence that ACE also lists two subsequent entry dates of August 7, 2018, and August 25, 2018, because there was an earlier entry summary filing in proper form and the merchandise arrived within port limits on July 27, 2018. See 19 C.F.R. § 141.68(e). Accordingly, the proper entry date of entry XXX-XXXX757-1 is July 27, 2018, the date on which the merchandise arrived within port limits with the intent to unlade as established by ACE and the supporting documentation. This entry date predates the August 23, 2018, effective date of the Section 301 duties. Entry XXX-XXXX757-1 should therefore be reliquidated without the assessment of Section 301 duties.
HOLDING:
The legal entry date of entry XXX-XXXX757-1 is July 27, 2018. This entry date predates the August 23, 2018, effective date of the Section 301 duties. Entry XXX-XXXX757-1 should therefore be reliquidated without the assessment of Section 301 duties. The protest is GRANTED.
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,
For Yuliya A. Gulis, Director
Commercial & Trade Facilitation Division