OT:RR:CTF:ER H155957 ASL
Port Director
U.S. Customs and Border Protection
330 Second Avenue S., Rm. 560
Minneapolis, MN 55401
Attn: Ms. Beverly Baer, Supervisory Import Specialist
Re: Application for Further Review of Protest No: 3501-10-100085; Hand Trucks from China; Antidumping Order A-570-891-004
Dear Port Director,
The purpose of this correspondence is to address the Application for Further Review (“AFR”) of Protest Number: 3501-10-100085, dated December 23, 2010, which we received March 24, 2011. The protesting party is Liberty Diversified Industries (“Liberty”).
FACTS:
Liberty made the following entries of hand trucks from the People’s Republic of China (“PRC”) that were subject to antidumping duty order number A-570-891-004:
Date of Entry
Entry Number
ADD Case Number
12/29/2007
xxxxxxxx946
A-570-891-004
01/13/2008
xxxxxxxx961
A-570-891-004
03/01/2008
xxxxxxxx489
A-570-891-004
07/14/2008
xxxxxxxx116
A-570-891-004
07/14/2008
xxxxxxxx132
A-570-891-004
See Notice of Antidumping Duty Order: Hand Trucks and Certain Parts Thereof From the People's Republic of China, 69 Fed. Reg. 70122 (Dec. 2, 2004). Liberty’s shipments of hand trucks were manufactured in the PRC by Qindao Taifa Group Co., Ltd. (“Taifa”). Liberty purchased the hand trucks from a third party, Denson International Ltd. (“Denson”), an entity based in Hong Kong. Taifa was not the invoicing party, nor was it listed as the foreign shipper on the bills of lading.
On November 12, 2004, the U.S. Department of Commerce (“Commerce”) issued an amended final determination finding that hand trucks from the PRC were being sold, or likely to be sold, at less than fair value within the United States. See Amended Final Determination of Sales at Less Than Fair Value: Hand Trucks and Certain Parts Thereof From the People's Republic of China, 69 Fed. Reg. 65410 (Nov. 12, 2004). Subsequently, on December 2, 2004, Commerce issued the antidumping duty order for hand trucks from the PRC. The antidumping duty order instructed Customs and Border Protection (“CBP”) to require cash deposits for PRC hand trucks produced or exported by Taifa equal to the specific weighted-average antidumping duty margin of 26.49 percent. See Notice of Antidumping Duty Order: Hand Trucks and Certain Parts Thereof From the People's Republic of China, 69 Fed. Reg. 70122 (Dec. 2, 2004). The PRC-wide rate was set at 383.60 percent. Id.
On May 15, 2007, Commerce published the final results of an administrative review of Taifa’s entries for the period of review from December 1, 2004, to November 30, 2005. See Hand Trucks and Certain Parts Thereof From the People's Republic of China: Final Results of Administrative Review and Final Results of New Shipper Review, 72 Fed. Reg. 27287 (May 15, 2007). In the final results, Commerce stated that the cash deposit rate for all non-PRC exporters will be the rate applicable to the PRC exporter that supplied that non-PRC exporter. Id.; see also, Message No. 7144206 (May 24, 2007). At the time, Taifa’s rate was 26.49 percent. Therefore, Denson’s entries had Taifa’s cash deposit rate of 26.49 percent. Id.
On May 25, 2010, Commerce published its final results of the antidumping duty administrative review, for the period of review from December 1, 2007, to November 30, 2008. Hand Trucks and Parts Thereof from the People's Republic of China: Final Results of Antidumping Duty Administrative Review, 75 Fed. Reg. 29314 (May 25, 2010). Taifa was not reviewed. On June 10, 2010, Commerce sent CBP liquidation instructions for entries exported by the PRC-wide entity during this period, stating that CBP should assess antidumping duties equal to the PRC-wide rate of 383.60 percent of the entered value of all shipments of hand trucks from the PRC exported by the PRC-wide entity. See Message No. 0161304 (June 10, 2010). On June 15, 2010, Commerce sent CBP liquidation instructions for entries exported by Taifa for this period stating that CBP should assess antidumping duties equal to the cash deposit rate at the time of entry for hand trucks from the PRC exported by Taifa. See Message No. 0166303 (June 15, 2010). Taifa’s cash deposit rate was 26.49 percent.
On September 3, 2010, CBP liquidated the entries in accordance with Message No. 0161304 and assessed an antidumping duty equal to the PRC-wide rate of 383.60 percent. On December 23, 2010, Liberty filed a protest with the port protesting the liquidation of its entries at the PRC-wide rate, arguing the liquidation of the entries was not executed in accordance with Commerce’s instructions. Liberty asserts that CBP failed to properly follow Commerce’s liquidation instruction and seeks reliquidation of these entries under the cash deposit rate of 26.49 percent. The port argues that the entries were properly liquidated because while the hand trucks were produced by Taifa, they were not exported by Taifa, but by Denson, a Hong Kong based company, and thus should have received the PRC-wide rate.
ISSUES:
Did CBP properly follow Commerce’s liquidation instructions?
LAW AND ANALYSIS:
We note initially that the instant protest was timely filed, within 180 days from the date of liquidation. 19 U.S.C. § 1514(c)(3)(A). Liquidation of Liberty’s entries was made on September 3, 2010, and this protest was filed on December 23, 2010, within 180 days. Additionally, further review is warranted because “the protest involves questions of law or fact which have not been ruled upon by the Commissioner of Customs or his designee, or by the Customs courts." 19 C.F.R. § 174.24(b). Specifically, protestant asserts that the entries were liquidated at the wrong rate. We agree that further review is warranted as the protest involves questions of law or fact that have not previously been ruled upon; accordingly, the criteria for further review by this office are satisfied per 19 C.F.R. §§ 174.24(a), 174.24(b) and 174.26(b)(1).
Liberty argues that the liquidation of its entries at the PRC-wide rate of 383.60 percent was contrary to Commerce’s instructions. Instead, Liberty seeks reliquidation of the entries at the cash deposit rate, which was 26.49 percent. See Message No. 7144206 (May 24, 2007) (stating that the cash deposit rate for all non-PRC exporters will be the rate applicable to the PRC exporter that supplied that exporter). The port determined that because Denson was the exporter and not Taifa, and the merchandise was laden in the PRC, the PRC-wide rate was applicable as Denson did not have a separate rate. However, because the hand trucks were exported by a third-party non-PRC country, and pursuant to Commerce’s instructions for this period of review, we find that Liberty’s entries should be reliquidated at the cash deposit rate of 26.49 percent.
Generally, assessed antidumping duties properly applied by CBP are not protestable, 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). However, inasmuch as Liberty protests the liquidation, i.e., disputes the application by CBP of Commerce's liquidation instructions, this matter is protestable. See Xerox Corp. v. United States, 289 F.3d 792 (Fed. Cir. 2002).
None of the material facts are in dispute here. Commerce issued two liquidation instructions that are relevant for these entries. The first liquidation instruction, which the port followed, stated that:
For all shipments of hand trucks and parts thereof from the People’s Republic of China (PRC) exported by the PRC-wide entity (A-570-891-000) entered, or withdrawn from warehouses, for consumption during the period 12/01/2007 through 11/30/2008, assess an antidumping liability equal to 383.60 percent of the entered value, except for those exported by Qindao Taifa Group Co., LTD. or Since Hardware (Guangzhou) Co., Ltd.
Message No. 0161304 (June 10, 2010). The second liquidation instruction stated that:
For all shipments of hand trucks and parts thereof from the People’s Republic of China (PRC) exported by the firms listed below and entered, or withdrawn from warehouse, for consumption during the period 12/01/2007 through 07/27/2008, assess an antidumping liability equal to the cash deposit or bonding rate at the time of entry.
Exporter
Qindao Taifa Group Co., Ltd.
Message No. 0166303 (June 15, 2010). The first instruction applies to entries of hand trucks that were exported by the PRC-wide entity. The second instruction applies to entries where the hand trucks were exported by Taifa. The port determined the former instruction to be applicable because while the hand trucks were produced by Taifa, they were not exported by Taifa, but by Denson, a Hong Kong based company. The port also noted that the merchandise was laden in the PRC, not in Hong Kong. In support of its position, the port relied on two messages from Commerce that it believes substantiated its claim that applying an antidumping duty equal to 383.60 percent of the entered value was appropriate. The messages stated that when the producer was Taifa, but the exporter was another PRC-wide entity, the PRC-wide rate applied.
As the liquidation instructions and inquiries were unclear as to which rate was applicable to entries that were exported from a third-party country, our office inquired with Commerce for a clarification as to which instruction would apply. On May 9, 2012, we received an answer from Commerce, which stated that Denson should receive Taifa’s rate “because in cases of third-country exporters that do not have their own rates (as is the case here), they receive the rate of the PRC supplier.” Based on the information provided by Commerce, Taifa’s antidumping duty rate was 26.49 percent. See Notice of Antidumping Duty Order: Hand Trucks and Certain Parts Thereof From the People's Republic of China, 69 Fed. Reg. 70122 (Dec. 2, 2004). Denson, as the third-country exporter of the Taifa hand trucks, had a cash-deposit rate equal to Taifa’s. See Hand Trucks and Certain Parts Thereof From the People's Republic of China: Final Results of Administrative Review and Final Results of New Shipper Review, 72 Fed. Reg. 27287 (May 15, 2007); Message No. 7144206 (May 24, 2007). Therefore, in accordance with Commerce’s instructions, Liberty’s entries of Taifa’s hand trucks, exported by Denson, should have been liquidated at the cash-deposit rate of 26.49 percent.
HOLDING:
Liberty’s entries should have been liquidated at the rate of 26.49 percent and protest 3501-10-100085 should be GRANTED. Therefore, the entries are to be reliquidated at the cash deposit rate at the time of entry.
No later than 60 days from the date of this letter, the Office of 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,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division