Customs Ruling HQ H303403 - Application for Further Review of Protest Numbers 3001-2018-100017 and 3001-2018-100018; Wooden Bedroom Furniture from the People’s Republic of China under Antidumping Order 570-890.

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HQ H303403
Sep 27, 2021

Type : • HTSUS :
Related: H258302; H258962; H150415

LIQ 4-01
H303403 SMS
OT:RR:CTF:ER

U.S. Customs and Border Protection
Port Director
17801 Pacific Highway S
Seattle, WA 98158-1249

Attn: Heather M. Scott, Supervisory Import Specialist

RE: Application for Further Review of Protest Numbers 3001-2018-100017 and 3001-2018-100018; Wooden Bedroom Furniture from the People’s Republic of China under Antidumping Order 570-890. Dear Port Director:

The following is our decision regarding the Application for Further Review (“AFR”) of Protest Number 3001-18-100017, filed on behalf of T&J International, LLC, d/b/a Lime Tree Sourcing (“Lime Tree”) on January 31, 2018, which contests the antidumping duties (“ADD”) and interest assessed on its entries of wooden bedroom furniture (“WBF”). We note that Protest Number 3001-18-100017 is the lead protest, and this ruling also addresses the identical arguments presented in Protest Number 3001-18-100018, also filed by Lime Tree on January 31, 2018.

FACTS:

On July 11, 2014 and July 17, 2014, Lime Tree made two entries containing WBF from the Peoples Republic of China (“China” or “PRC”), exported by Shanghai Jian Pu Import & Export Co., Ltd. (“Shanghai Jian Pu”), and assigned entry numbers, xxx-xxxx810-7 and xxx-xxxx849-5, respectively. Both entries were entered as “03,” as subject to antidumping and countervailing duties, and their U.S. Customs and Border Protection (“CBP”) Entry Summary Forms 7501 specifically contain the following product descriptions:

Other Wooden Bedroom Furniture 9403.50.9080 A-570-890-122 . . .

Other Wooden Furniture 9403.60.8081.”

Additionally, contained in the Shanghai Jian Pu issued invoices the subject merchandise is described as:

Two-Drawer Dresser with Dresser Top; Three-Drawer Nightstand; Television Cabinets/Stand with Two Doors; and Armoire Tower Base and Deck Unit.

Lime Tree made ADD cash deposits of 6.68 percent ad valorem at the time of entry, for the above listed product descriptions included in both entries.

On January 4, 2005, the U.S. Department of Commerce (“Commerce” or “DOC”) published its determination of sales of WBF from China at less than fair market value. See Notice of Amended Final Determination of Sales at Less Than Fair Value and Antidumping Order: Wooden Bedroom Furniture from the People’s Republic of China, 70 Fed. Reg. 329 (Jan. 4, 2005) (“WBF Order”) (see also message 5033207, February 2, 2005). In this Order Commerce stated that it intended to instruct CBP to collect cash deposits of estimated ADD on entries subject to the order. Id. at 330. Subsequently, on March 2, 2015, Commerce issued a notice of Initiation of Antidumping and Countervailing Duty Administrative Reviews including the WBF Order for the period of review from January 1, 2014, until December 31, 2014, for specific manufacturers including Shanghai Jian Pu. See 80 Fed. Reg. 11,166, 70 (Mar. 2, 2015).

On April 11, 2016, Commerce published its Final Results for the 2014 administrative review period, finding that Shanghai Jian Pu failed to establish eligibility for a separate entity rate and assigning it the NME-wide entity rate. See Wooden Bedroom Furniture from the People’s Republic of China: Final Results and Final Determination of No Shipments, In Part 2014 Administrative Review, 81 Fed. Reg. 21,319 (Apr. 11, 2016) (“Final Results”). See also DOC Message No. 6110303 (Apr. 19, 2016).

Additionally, Commerce no longer chose to consider American Furniture Manufacturers Committee for Legal Trade and Vaughan-Bassett Furniture Company, Inc.’s (collectively, “AFMC”) claims of duty evasion by Shanghai Jian Pu. 69 Fed. Reg. 21,319. As a result of this dismissal, AFMC filed suit with the Court of International Trade (“CIT”), challenging Commerce’s failure to review its claim of duty evasion by Shanghai Jian Pu. On April 27, 2016, the CIT issued a preliminary injunction enjoining the liquidation of entries of WBF, exported by Shanghai Jian Pu in 2014. Commerce then issued Message Number 6123302 dated May 2, 2016, advising CBP of a preliminary injunction enjoining liquidation of the relevant entries. See DOC Message No. 6123302 (May 2, 2016). On March 13, 2017, the CIT granted the Government’s motion to dismiss the action, finding that AFMC received the relief it sought when Shanghai Jian Pu was found ineligible for an entity specific rate. See American Furniture Manufacturers Committee for Legal Trade and Vaughan-Bassett Furniture Company, Inc., v. United States, 2017 Ct. Intl. Trade LEXIS 24 (Ct. Int’l Trade 2017).

On May 30, 2017, Commerce issued Message 7150306 advising that,

On 03/13/2017, the U.S. Court of International Trade issued a final decision in the case of American Furniture Manufacturers Committee for Legal Trade and Vaughan-Bassett Furniture Company, Inc. v. United States (16-00070). As a result of this decision, the injunction to which message 6123302 refers enjoining liquidation of entries which are subject to the antidumping duty order on wooden bedroom furniture from the People’s Republic of China for the period 01/01/2014 through 12/31/2014 exported by Shanghai Jian Pu Import & Export Co., Ltd. dissolved on 05/12/2017.

This message also instructed CBP to liquidate entries exported by Shanghai Jian Pu at the PRC-wide rate of 216.01 percent. See DOC Message 7150306 (May. 30, 2017).

On October 27, 2017, CBP liquidated both of Lime Tree’s entries at the PRC-wide rate of 216.01 percent. Lime Tree protested the liquation of its entries on January 31, 2018. Lime Tree asserts in its protests that its entries are not subject to ADD “due to the construction of the imported goods.” Additionally, Lime Tree contends that the entries deemed liquidated as a matter of law. Lime Tree contends that the CIT injunction “was dissolved on 05/12/2017 after determination of USCIT Case No. 16-00070, as reflected in CBP Message No. 7150306. As a result, the asserted liquidation date of 10/27/17 occurred more than six (6) months after receiving notice of the removal of the suspension of liquidation; and more than six (6) months after the injunction was dissolved.” Lastly, Lime Tree implores CBP to grant relief from the rate advance and interest because it “has no history of non-compliance with CBP regulations.”

ISSUE: Whether CBP properly liquidated Lime Tree’s entries. LAW AND ANAYLSIS:

Pursuant to 19 U.S.C. § 1514, CBP decisions are final unless a protest is timely filed against that decision in accordance with § 1514(c). See 19 U.S.C. § 1514(a). Specifically, a protest must be filed within 180 days from the date of liquidation. See 19 U.S.C. § 1514(a)(5); 19 C.F.R. § 174.12(e). Here, the two entries were liquidated on October 27, 2017. Subsequently, on January 31, 2018, Lime Tree protested these liquidations, within 180 days.

Generally, it is well settled that when assessing and collecting ADD, 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. “Customs, incident to its ‘ministerial’ function of fixing the amount of duties chargeable, must make factual findings to determine ‘what the merchandise is, and whether it is described in an order’ and must decide whether to apply the order to the merchandise. LDA Incorporado v. United States, 79 F. Supp. 3d 1331, 1339 (Ct. Int’l Trade 2015). Pursuant to its ministerial function, however, CBP cannot “affect the scope of the order.” Id. Accordingly, CBP must follow Commerce’s instructions with regard to the entries of WBF from China at issue in this case.

In this instance Lime Tree contends that its merchandise does not fall within the scope of the ADD order; conversely, if it does fall within the scope of the order, the entries deemed liquidated at the deposit rate collected at the time of entry. Lime Tree does not dispute that Shanghai Jian Pu was the exporter of its imports, or that the pertinent Commerce instructions apply to its merchandise, if found within scope. Inasmuch as Lime Tree protests the timing of the liquidation, this matter is protestable. See Xerox Corp. v. United States, 289 F.3d 792 (Fed. Cir. 2002); see also, Headquarters Ruling (“HQ”) 221591 (Feb. 13, 1990) (a mistake in the liquidation process can be corrected by one of the statutory methods set forth in 19 U.S.C. § 1514).

Additionally, “where the importer claims that Customs erred as a matter of fact by including its goods within the scope of the order, Customs’ determination is the proper subject for a protest. LDA Incorporado v. United States, 978 F. Supp. 2d 1359, 1367 (Ct. Int’l Trade 2014) (citing Xerox Corp. v. United States, 289 F.3d 792, 795 (Fed. Cir. 2002). On the other hand, if the scope of the order is unambiguous and CBP follows Commerce’s instructions, there is no decision that is made by CBP that would be protestable. See Mitsubishi Elecs. Am., Inc. v. United States, 44 F.3d 973, 977 (Fed. Cir. 1994) (holding that CBP has a ministerial role in liquidating antidumping duties and “cannot modify Commerce’s determinations, their underlying facts, or their enforcement”); HQ H258302 (Sept. 3, 2015) (finding that “because the scope of the antidumping and countervailing duty orders was clear and CBP acted in accordance with Commerce’s instructions, CBP acted in its ministerial capacity when it liquidated its entries” and the protest “failed to raise a protestable issue”).

Accordingly, “where CBP can conclude that a product falls within the words of the order, both the affirmative scope language and any exclusions, CBP properly requires an importer to enter its goods as subject to an order.” Sunpreme, Inc. v. United States, 190 F. Supp. 3d 1185, 1202 (Ct. Int’l Trade 2016). The inquiry “comes down to whether CBP can determine that merchandise falls within the common meaning of the scope language based upon observable physical characteristics.” Id. If the importer believes that CBP has made a mistake of fact and does not want its goods to be covered by the order, the remedy is to seek a scope ruling. See LDA Incorporado, 79 F. Supp. 3d at 1342 n.12. The importer can request that CBP extend the time for liquidation if there is good cause. 19 C.F.R. § 159.12(a)(1)(ii).

At issue in this case is the WBF Order issued by Commerce in January 2005. See 70 Fed. Reg. 329. The scope of the order described the covered merchandise as follows:

The product covered by the order is wooden bedroom furniture. Wooden bedroom furniture is generally, but not exclusively, designed, manufactured, and offered for sale in coordinated groups, or bedrooms, in which all of the individual pieces are of approximately the same style and approximately the same material and/or finish.

. . . .

The subject merchandise includes the following items: (1) Wooden beds such as loft beds, bunk beds, and other beds; (2) wooden headboards for beds (whether stand-alone or attached to side rails), wooden footboards for beds, wooden side rails for beds, and wooden canopies for beds; (3) night tables, night stands, dressers, commodes, bureaus, mule chests, gentlemen's chests, bachelor's chests, lingerie chests, wardrobes, vanities, chessers, chifforobes, and wardrobe-type cabinets; (4) dressers with framed glass mirrors that are attached to, incorporated in, sit on, or hang over the dresser; (5) chests-on-chests \1\, highboys \2\, lowboys \3\, chests of drawers \4\, chests \5\, door chests \6\, chiffoniers \7\, hutches \8\, and armoires \9\; (6) desks, computer stands, filing cabinets, book cases, or writing tables that are attached to or incorporated in the subject merchandise; and (7) other bedroom furniture consistent with the above list.

Id. at 332.

In its protest Lime Tree does not provide any reasoning or explanations or evidence as to why the wooden bedroom furniture it entered as subject to ADD should now be found outside of the WBF Order scope. As listed above, Lime Tree entered the merchandise with the production description of wooden bedroom furniture. Additionally, contained in the Shanghai Jian Pu issued invoices the subject merchandise is described as: dressers, nightstands, cabinets, and armoires.”

Lime Tree’s request that CBP find its merchandise outside of the scope of the WBF Order, despite what is included in the entry documentation, would infringe upon Commerce’s authority to determine that a particular type of merchandise is within the class or kind of merchandise described in an existing finding of dumping and would potentially cause CBP to impermissibly alter the scope. See Sandvik v. United States, 957 F. Supp. 276 (Ct. Int’l Trade 1997), aff’d 164 F.3d 596, 598 (Fed. Cir. 1998). To do so would exceed CBP’s ministerial authority to determine factually whether the furniture falls inside the WBF Order. Accordingly, because CBP has not erred as a matter of fact that the merchandise falls under the unambiguous language of the WBF Order and Final Results, CBP followed Commerce’s instructions, and properly assessed antidumping duties on the entries under the WBF Order. If Lime Tree continues to believe that CBP has erred as a matter of fact, it must seek a scope ruling request from Commerce to determine whether the particular merchandise at issue is outside of the scope of the WBF Order. Since Lime Tree offers no evidence to support its assertion, we need not address this issue further. Next, Lime Tree contends its entries liquidated as a matter of law, six months after the May 12, 2017 dissolution of the CIT imposed injunction of liquidation and Commerce’s May 30, 2017 notice of dissolution. Section 1504(d) of Title 19 requires that CBP liquidate entries within six months after receiving “notice” that a suspension of liquidation of such entries has been removed. If CBP fails to timely liquidate the entries after receiving notice, the entries are “deemed” liquidated at the rate asserted at the time of entry. See Fujitsu Gen. Am., Inc. v. United States, 283 F.3d 1364, 1376 (Fed. Cir. 2002). “In order for a deemed liquidation to occur, (1) the suspension of liquidation that was in place must have been removed; (2) Customs must have received notice of the removal of the suspension; and (3) Customs must not liquidate the entry at issue within six months of receiving such notice.” Id.

First, for deemed liquidation to occur, the suspension of liquidation must have been removed. See Fujitsu, 283 F.3d at 1364. In Fujitsu, the Court of Appeals for the Federal Circuit concluded that where liquidation is suspended pursuant to a court injunction, the suspension is removed when a “final court decision” is reached in the cause of action before the court, i.e., when the decision can no longer be appealed. Id. at 1377; see also, 19 U.S.C. § 1516a(e) (providing that entries suspended by court order shall be liquidated when there is a final court decision). Furthermore, the CIT does not have discretion to require liquidation before a case reaches its final conclusion in the appeals process, which ensures that liquidation of subsequent entries can occur pursuant to the conclusive decision. See Hosiden Corp. v. Advanced Display Mfrs. of Am., 85 F.3d 589, 591 (Fed. Cir. 1996). See also, HQ H258962 (June 24, 2015).

Here, on March 31, 2015, Commerce issued a public message instructing CBP to continue to suspend liquidation of Shanghai Jian Pu’s entries of WBF entered in 2014. See DOC Message No. 5090305. While Final Results for 2014 entries were published on April 11, 2016, and liquidation instructions were issued on April 19, 2016, Shanghai Jian Pu commenced an action in the CIT challenging these results. Accordingly, on April 27, 2016, the CIT enjoined the liquidation of all 2014 entries of WBF exported by Shanghai Jian Pu. See DOC Message No. 6123302. On March 13, 2017, the CIT dismissed the claim. However, the injunction did not dissolve on that date. The injunction dissolved upon the expiration of the period to appeal this decision, until May 12, 2017, as the litigation became final 60 days after the final decision where no appeal was filed. See 19 U.S.C. § 1516a(e) and Fujitsu, 283 F.3d at 1377. See also, Hosiden Corp. v. Advanced Display Mfrs. of Am., 85 F.3d 589, 591 (Fed. Cir. 1996). (The CIT does not have discretion to require liquidation before a case reaches its final conclusion in the appeals process, which ensures that liquidation of subsequent entries can occur pursuant to the conclusive decision).

Second, once suspension is removed, CBP must have received notice of the removal of suspension. For court-ordered suspension of liquidation, the court in Fujitsu stated that in cases where litigation comes to an end and the court-ordered suspension of liquidation is removed, it is important that “an unambiguous and public starting point for the six-month liquidation period” is known. See Fujitsu, 283 F.3d at 1382. The court in Fujitsu found that Commerce’s subsequent publication of the court’s ruling in the Federal Register was such an “unambiguous and public starting point,” and thus, constituted notice for purpose of 19 U.S.C. § 1504(d). Id. In the instant case, the court case was dismissed and became final without publication in the Federal Register, at the end of the appeal period.

However, the simple act of the court dismissing a case does not constitute notice for purpose of 19 U.S.C. § 1504(d). In HQ H258962, dated June 24, 2015, we found that where no Federal Register notice was published following a final court ruling affirming Commerce’s final results, CBP first received public and unambiguous notice of the lifting of the suspension when Commerce issued liquidation instructions. See also, HQ H150415 (July 12, 2013). Here, on May 30, 2017, Commerce issued a public notice of the May 12, 2017 dissolution of the injunction against liquidation of the subject entries and instructed CBP to liquidate entries exported by Shanghai Jian Pu at the PRC-wide rate of 216.01 percent. See DOC Message No. 7150306. Accordingly, notice of the lifting of suspension of liquidation occurred in Commerce’s Message Number 7150306, dated May 30, 2017. Message Number 7150306 was both a public and unambiguous notice to CBP that the suspension of Lime Tree’s WBF had lifted. No prior form of notification served as public and unambiguous notice to CBP of the lifting of suspension, thus, we find that Message Number 7150306 served as “notice” pursuant to 19 U.S.C. § 1504(d). See id.

Lastly, for deemed liquidation to occur, the entries at issue must not have been liquidated within six months of CBP receiving notice of the removal of suspension. See Fujitsu, 283 F.3d at 1376. In this case, CBP first received notice of the suspension of liquidation’s lifting for Lime Tree’s WBFs, with Commerce’s Message Number 7150306 on May 30, 2017. CBP’s ministerial role is to follow liquidation instructions. In this case, CBP properly liquidated the subject entries on October 27, 2017, within six months of the May 30, 2017 notice that suspension of liquidation ended. See DOC Message No. 7150306. Accordingly, CBP timely performed a ministerial role in liquidating the entries. Thus, the entries were properly liquidated in accordance with the notice from Commerce and the subject entries did not liquidate as a matter of law.

HOLDING:

Based on the above discussion, CBP properly liquidated the subject entries of wooden bedroom furniture, pursuant to DOC Message Number 7150306 within the statutory six-month period after receiving notice of the removal of a court-ordered suspension of liquidation. Accordingly, Protest Numbers 3001-2018-100017 and 3001-2018-100018 should be DENIED

Sixty days from the date of the decision, the Office of Trade, Regulations and Rulings will make the decision available to CBP personnel, and to the public on the Customs Rulings Online Search System (CROSS) at https://rulings.cbp.gov/ which can be found on the U.S. Customs and Border Protection website at http://www.cbp.gov and other methods of public distribution.

Sincerely,

for Craig T. Clark, Director
Commercial and Trade Facilitation Division