PRO 2-05
OT:RR:CTF:ER H239242 GGK
Port Director
Customs and Border Protection
2350 N. Sam Houston Pkwy E.
Suite 1000
Houston, TX 77032-3100
Attn: Mary Pugh, Supervisory Import Specialist
RE: L.F.I. Incorporated’s Application for Further Review of Protest 5309-12-100590
Dear Port Director:
This is in response to the application for further review (“AFR”) for Protest 5309-12-100590 (“protest”), filed by L.F.I. Incorporated (“L.F.I.”), on August 29, 2012. We note that the protest and AFR were initially denied by the Houston Service Port (“Port”) on November 6, 2012. Thereafter, on November 21, 2013, LFI filed a request to set aside the denial of further review and to void the denial of the protest pursuant to 19 U.S.C. §§ 1515(c) and (d), which was granted by this office on January 17, 2013. Our further review of the protest is below.
FACTS:
L.F.I. is a company that imports various food products, including preserved mushrooms. In August 2009, the company imported a shipment of preserved mushrooms manufactured in the People’s Republic of China (“PRC”). Upon making entry on August 17, 2009, the shipment was assigned entry number xxx-xxxx314-3. Entry xxx-xxxx314-3 is at issue in the instant protest.
Certain preserved mushrooms from the PRC are subject to antidumping duties. See Notice of Amendment of Final Determination of Sales at Less Than Fair Value and Antidumping Duty Order: Certain Preserved Mushrooms From the People’s Republic of China, 64 Fed. Reg. 8,308 (Feb. 19, 1999). Liquidation of the entry at issue was suspended pending the Department of Commerce’s (“Commerce”) administrative review covering all entries of certain preserved mushrooms from the PRC entered between February 1, 2009 and January 31, 2010. On September 14, 2011, Commerce published the final results of the administrative review. See Certain Preserved Mushrooms From the People’s Republic of China: Final Results of Antidumping Duty Administrative Review and Rescission in Part, 76 Fed. Reg. 56,732 (Sept. 14, 2011). Subsequently, on November 10, 2011, Commerce published an amended final results of the administrative review to correct ministerial errors. See Certain Preserved Mushrooms From the People’s Republic of China: Amended Final Results of Antidumping Duty Administrative Review, 76 Fed. Reg. 70,112 (Nov. 10, 2011).
Thereafter, Commerce issued multiple liquidation instructions to CBP based on its final results and amended final results. Two liquidation instructions are at issue in this protest. First, on November 25, 2011, Commerce issued Message Number 1329307. According to these instructions, Commerce instructed CBP to assess an antidumping liability that is lower than the rate assigned to the PRC-wide entity for all shipments of certain preserved mushrooms from the PRC “manufactured or exported by” specific firms and entered for consumption during the period between February 1, 2009 and January 31, 2010. Id. Included in the named firms are the manufacturer, Ayecue (Liaocheng) Foodstuff Co., Ltd. (“Ayecue Liaocheng”), and the exporter, Ayecue International SLU (“Ayecue International”). Id. The second set of liquidation instructions applied to certain preserved mushrooms from the PRC exported by the PRC-wide entity and entered for consumption during the period of review. See Message Number 1334302 (Nov. 30, 2011). Based on these instructions, entries exported by the PRC-wide entity are subject to an antidumping liability equal to 198.63 percent of the entered value.
Upon receiving these instructions, the Port reviewed the commercial documents provided with the entry summary documentation and determined that while Ayecue Liaocheng was the manufacturer of the mushrooms, the evidence did not support a finding that Ayecue International was the exporter of the merchandise. Based on this conclusion, the Port liquidated the entry of mushrooms on March 2, 2012, and assessed the antidumping liability assigned to the PRC-wide entity. L.F.I. filed its protest on August 29, 2012, arguing that the Ayecue Liaocheng/Ayecue International rate should have been assessed instead. Moreover, on September 10, 2012, L.F.I. supplemented its protest with additional commercial documents to establish the identities of various parties involved in the sale and importation of the shipment of mushrooms. L.F.I. contends that the commercial documentation evidences Ayecue International as the exporter of the merchandise. Therefore, its entry was subject to the lower specific rate assigned to Ayecue Liaocheng and Ayecue International.
We note that the relevant commercial documents include a commercial invoice, packing list, bill of lading, freight bill/arrival notice, and freight invoice. The commercial invoice, identified by Invoice Number 20/09 and dated July 24, 2009, is issued by Ayecue International to L.F.I. for the sale of mushrooms at issue. The commercial invoice specifically notes that the mushrooms are “manufactured by Ayecue (Liaocheng)” and provides the shipping container number for the mushrooms as CMAU 0085804. The packing list is also issued by Ayecue International to L.F.I. This document references Invoice Number 20/09 and container number CMAU 0085804. Moreover, the packing list also notes that the mushrooms covered by the packing list are “manufactured by Ayecue Liaocheng.” Next, the bill of lading, recognized by B/L Number OERT205702901005, identifies Savino Del Bene (Shanghai) Co., Ltd. as the shipper of the mushrooms and Savino Del Bene U.S.A. Inc. as the consignee. Like the commercial invoice and packing list, the bill of lading identifies the container number CMAU 0085804 and notes that the mushrooms are “manufactured by Ayecue (Liaocheng).” Finally, we turn to the freight bill/arrival notice and freight invoice. Both documents are issued by Savino Del Bene U.S.A., Inc. and identify the “Supplier” of the merchandise as “Ayecue Liaocheng Foodstuff Co. Ltd.” and the Consignee as L.F.I. The freight bill/arrival notice specifically references container number CMAU 0085804, includes an internal File Reference number S44711, and notes that the shipper is Savino Del Bene Co. Ltd. Last, the freight invoice includes the internal reference number S447111 and identifies L.F.I as the party responsible for paying all freight charges. According to the company’s website, www.savinodelbene.com, Savino Del Bene Group, which includes the subsidiaries Savino Del Bene Co. Ltd., Savino Del Bene (Shanghai) Co., Ltd., and Savino Del Bene U.S.A. Inc., is a global logistics and forwarding company. Based on all of the above, we evaluate whether L.F.I.’s entry was properly liquidated.
ISSUE:
Whether CBP properly applied the PRC-wide entity’s antidumping rate to entry xxx-xxxx314-3.
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 L.F.I.’s entry occurred on March 2, 2012, and this protest was timely filed on August 29, 2012, 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, we will examine the proper application of Commerce’s liquidation instructions and the identity of the exporter of the merchandise at issue. Accordingly, the criteria for further review is satisfied per 19 C.F.R. § 174.24(b) and 19 C.F.R. § 174.26(b)(1)(iv).
Generally, it is well settled that when assessing and collecting antidumping duties CBP merely follows Commerce's instructions. See Mitsubishi Electronics America, Inc. v. United States, 44 F.3d 973, 977 (Fed. Cir. 1994). The courts have consistently held that CBP's role in the antidumping process is simply to follow Commerce’s instructions in collecting deposits of estimated duties and in assessing antidumping duties, together with interest, at the time of liquidation. See Fujitsu Ten Corporation of America v. United States, 21 C.I.T. 104, 107 (1997); and American Hi-Fi International, Inc. v United States, 19 C.I.T. 1340, 1342-43 (1995). In Mitsubishi, the Court held that "CBP has a merely ministerial role in liquidating antidumping duties." 44 F.3d at 977. Thus, CBP simply applies the antidumping duty rates determined by Commerce to entries of merchandise in accordance with Commerce’s liquidation instructions. Accordingly, CBP must follow Commerce’s instructions with regard to the entry of mushrooms from the PRC at issue in this case.
Before examining the facts before us, we first note that both the Port and L.F.I. focus on the identity of the exporter to determine which antidumping duty rate is applicable. The liquidation instructions contained in Message Number 1329307, dated November 25, 2011, however, specifically instructs CBP to assess a specific antidumping liability for all shipments of certain preserved mushrooms from the PRC “manufactured or exported” by various companies, including the manufacturer Ayecue Liaocheng and the exporter Ayecue International. Therefore, there is a question as to whether mushrooms manufactured by Ayecue Liaocheng or exported by Ayecue International would receive the specific rate. To clarify the meaning of “manufactured or exported,” CBP submitted a request for clarification to Commerce on July 28, 2014. Thereafter, on August 28, 2014, Commerce clarified in an email that the phrase “manufactured or exported by the firms listed below” requires CBP to apply the specific rate only to shipments of certain preserved mushrooms from the PRC that are manufactured by Ayecue Liaocheng and exported by Ayecue International.
In light of this clarification, we now turn to the facts of this case. Based on the commercial documentation submitted by L.F.I., we first note that Ayecue Liaocheng is the manufacturer of the mushrooms. Specifically, the commercial invoice, packing list, and bill of lading all state that the mushrooms are “manufactured by Ayecue Liaocheng.” Additionally, the freight bill/arrival notice and freight invoice note that the “Supplier” of the mushrooms is “Ayecue Liaocheng Foodstuff Co. Ltd.” Therefore, Ayecue Liaocheng manufactured the mushrooms at issue.
Turning to the exporter, the commercial documents identify the following companies: Ayecue Liaocheng, Ayecue International, L.F.I., and the Savino Del Bene Group subsidiaries. We know that Ayecue Liaocheng is the manufacturer of the mushrooms and L.F.I. is the purchaser. In terms of the Savino Del Bene Group subsidiaries, the companies provide logistics and forwarding services, such as the shipping of the goods. See www.savinodelbene.com. The commercial documents submitted do not identify the Savino Del Bene Group subsidiaries as the exporter of the mushrooms. First, the commercial invoice and packing list do not reference the Savino Del Bene Group subsidiaries. Therefore, these documents indicate that the Savino Del Bene Group subsidiaries did not participate in the sales transaction involving the mushrooms.
Furthermore, the freight bill/arrival notice, freight invoice, and bill of lading only identify the Savino Del Bene Group subsidiaries as the shipper of the mushrooms. Both the freight bill/arrival notice and freight invoice are issued by Savino Del Bene U.S.A., Inc. directly to L.F.I. The freight invoice directly bills L.F.I. only for freight costs and services related to the shipment of the mushrooms. The freight bill/arrival notice identifies Savino Del Bene Co. Ltd as the shipper of the merchandise. These two documents demonstrate that L.F.I. contracted with the Savino Del Bene Group subsidiaries to ship the goods to the United States. In turn, Savino Del Bene (Shanghai) Co., Ltd. contracted with the carrier to transport the mushrooms to the United States, as evidenced by the bill of lading, which identifies Savino Del Bene (Shanghai) Co., Ltd. as the shipper. As noted in HQ H152586 (December 20, 2013), the commercial practice of the transportation industry is for the carrier to identify the shipper as the party with whom the carrier has a contractual relationship. See Dictionary of Shipping Terms, Peter R. Brodie 119 (Lloyd’s of London Press Ltd. 1985). Consequently, the bill of lading, freight bill/arrival notice and freight invoice all identify the Savino Del Bene Group subsidiaries as the shipper of the merchandise. A party solely involved in the shipping of merchandise, in this case the Savino Del Bene Group subsidiaries, does not qualify as an exporter. See HQ H152586 (December 20, 2013) (holding that a party identified only as the shipper of merchandise failed to qualify as an exporter).
Finally, we turn to Ayecue International. Both the commercial invoice and packing list are issued by Ayecue International directly to L.F.I. The commercial invoice demonstrates that the mushrooms were sold to L.F.I. by Ayecue International and the packing list shows that Ayecue International prepared the mushrooms for shipment to the United States. Therefore, Ayecue International’s involvement in the sale and shipment of the mushrooms qualifies the company as an exporter. Moreover, there is no evidence that any other entity, other than Ayecue International, was involved in the sale or exportation of the mushrooms from the PRC. Therefore, we find that the exporter of the mushrooms is Ayecue International. Accordingly, because the mushrooms are manufactured by Ayecue Liaocheng and exported by Ayecue International, Message Number 1329307 applies to the entry and CBP should assess the antidumping rate assigned to Ayecue Liaocheng/Ayecue International per Message Number 1329307 (November 25, 2011).
HOLDING:
Protest 5309-12-100590 should be GRANTED in full, pursuant to the proper application of liquidation instructions issued by Commerce, and reliquidated accordingly.
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 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,
Myles B. Harmon, Director
Commercial and Trade Facilitation Division