HQ 0220005 - Internal Advice (unnumbered), concerning Protest No. 1001-7- 007538, protesting the decision in the liquidation on July 11, 1986, of Entry No. 86-871609-9, dated May 27, 1986, covering a shipment containing, inter alia, ladies ornamented swimwear made in Israel. - United States International Trade Commision Rulings

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HQ 220005

March 14, 1988

CO:R:C:E 220005 KP

CATEGORY: ENTRY LIQUIDATION

Regional Commissioner of Customs
New York Region
6 World Trade Center
New York, New York 10048-0945

RE: Internal Advice (unnumbered), concerning Protest No. 1001-7- 007538, protesting the decision in the liquidation on July 11, 1986, of Entry No. 86-871609-9, dated May 27, 1986, covering a shipment containing, inter alia, ladies ornamented swimwear made in Israel.

Dear Sir:

With your memorandum of December 18, 1987 (your reference PRO-4:O:C:R LR), you requested our advice regarding whether, in the context of the above-referenced protest, an entry may be reliquidated pursuant to section 520(c)(1), Tariff Act of 1930, as amended (19 U.S.C. 1520(c)(1)), on the basis of a Presidential proclamation. Our decision follows:

FACTS:

Presidential Proclamation 5365 of August 30, 1985, imple- mented reductions in United States rates of duty pursuant to the United States-Israel Free Trade Area Agreement (FTA Agreement) by modifying the Tariff Schedules of the United States (TSUS). One change made by the proclamation was the insertion of items 384.19 and 384.20, TSUS, to supersede item 383.19, TSUS, with respect to articles entered on or after September 1, 1985. Duty rates under item 384.19, TSUS, for products of Israel were set at 30% ad valorem for articles entered on or after September 1, 1985, but before January 1, 1987, 12% ad valorem for articles entered on or after January 1, 1987, but before January 1, 1989, and free for articles entered on or after January 1, 1989. Among the articles provided for in item 384.19 were ornamented, knit, swimming suits and other swimwear of man-made fibers, for women, girls, or infants.

On May 27, 1986, the protestant entered at JFK Airport a shipment containing ladies ornamented swimwear from Israel. Duty on the swimwear was assessed at 30% ad valorem under item 384.19, TSUS. On July 11, 1986, the entry covering the swimwear was
liquidated with no change in duty on the swimwear. No protest was filed within the next 90 days against that liquidation decision; accordingly, the liquidation became final on October 9, 1986, pursuant to section 514(a), Tariff Act of 1930, as amended (19 U.S.C. 1514(a)).

On May 4, 1987, the President issued Presidential Proclama- tion 5646 to, among other things, modify the tariff treatment being extended to products of Israel under the TSUS pursuant to the FTA Agreement. One change effected by this proclamation was the addition of a new provision for ornamented, knit, swimming suits and other swimwear of man-made fibers, for women, girls, or infants, under item 384.17, TSUS, and the deletion of the corre- sponding provision for that merchandise in item 384.19, TSUS. This change was necessary "due to an inadvertence of both parties to the Israel Agreement" which caused the contemplated duty reduction on the swimwear to be improperly implemented. Presi- dential Proclamation 5646, 52 Fed. Reg. 16,805, 16,806 (1987). A free rate of duty was established for products of Israel entered under item 384.17, TSUS, and this rate was proclaimed to be effective with respect to articles entered, or withdrawn from warehouse for consumption, on or after September 1, 1985.

On May 26, 1987, the protestant, claiming that his imported swimwear was entitled to and would have been given duty-free treatment under the FTA Agreement but for the inadvertence noted in Presidential Proclamation 5646, filed the subject protest, requesting reliquidation of duties on the merchandise under item 384.17, TSUS, pursuant to section 520(c)(1), Tariff Act of 1930, as amended (19 U.S.C. 1520(c)(1)).

ISSUE:

Whether an inadvertence resulting in the improper implemen- tation of a trade agreement in the TSUS warrants under 19 U.S.C. 1520(c)(1) the reliquidation of an entry which was liquidated in accordance with the improperly implemented tariff provisions and for which liquidation has become final.

LAW AND ANALYSIS:

Title 19, United States Code, section 1520(c)(1) provides:

Notwithstanding a valid protest was not filed, the appropriate customs officer may, in accordance with regulations prescribed by the Secretary, reliquidate an entry to correct --

(1) a clerical error, mistake of fact, or other inadvertence not amounting to an error in the construction of a law, adverse
to the importer and manifest from the record or established by documentary evidence, in any entry, liquidation, or other customs transaction, when the error, mistake, or inadvertence is brought to the attention of the appropriate customs officer within one year after the date of liquidation or exaction;

The protestant filed his claim on May 26, 1987, some ten and one-half months after the entry was liquidated on July 11, 1986. Accordingly, the claim was timely filed under 19 U.S.C. 1520(c) (1). We find that the claim also was adequately brought to the attention of the Customs Service for purposes of 19 U.S.C. 1520 (c)(1), notwithstanding that it was filed on Customs Form 19, which is the form used to file protests under 19 U.S.C. 1514. Therefore, the procedural requirements of the statute have been satisfied.

As far as the merits of the claim are concerned, we encoun- tered an issue similar to the one presented here in Customs Ruling CLA-2 CO:R:CV:G 073482 JCH (Mar. 2, 1984). In that case, an entry of pickles from Poland was liquidated at the column 2 rates of duty in the TSUS pursuant to Presidential Proclamation 4991, which imposed column 2 rates of duty on Polish products exported to the United States on or after November 1, 1982. The entry of pickles was liquidated on January 3, 1983. Several months later, Presidential Proclamation 5048 amended the earlier proclamation by excepting from the column 2 duty rates articles ordered under a contract executed on or before "October 9, 1982, [sic]" and for which certain other conditions were met. All of the requirements to except the pickles from the column 2 duty rates under Presidential Proclamation 5048 were satisfied, so the importer filed a protest requesting reliquidation of the entry of pickles on July 25, 1983.

We determined in Customs Ruling 073482 that the importer's protest could not be approved under section 514, Tariff Act of 1930, as amended (19 U.S.C. 1514), because an exception to the finality of liquidations resulting from the operation of that provision can only be made by legislation. We then considered whether the protest could be regarded as an informal valid claim under 19 U.S.C. 1520(c)(1) on the premise that failure to apply the column 1 rates of duty to the subject merchandise was the result of "a clerical error, mistake of fact, or other inadver- tence not amounting to an error in the construction of the law" as contemplated by that section. However, comparing the situa- tion to United States v. Miles, 57 CCPA 1, C.A.D. 967, 416 F.2d 973 (1969), we concluded that relief was unavailable under 19 U.S.C. 1520(c)(1) inasmuch as there was no error at the time liquidation was made on the entry.

The same analysis may be applied to this section 520(c)(1) claim. The protestant would have us reliquidate its entry based on a subsequent change in the law which was necessitated by an inadvertence of both parties to the FTA Agreement. That, how- ever, is not the kind of inadvertence for which relief has been provided under 19 U.S.C. 1520(c)(1) because it did not cause an improper liquidation. According to existing law at the time that duties were liquidated on the protestant's merchandise, swimwear of the type in question was dutiable at 30% ad valorem under item 384.19, TSUS. That was the rate of duty and the tariff classi- fication selected for the protestant's merchandise. Thus, the entry was properly liquidated under existing law; there is nothing to correct pursuant to 19 U.S.C. 1520(c)(1).

HOLDING:

An inadvertence resulting in the improper implementation of a trade agreement in the TSUS does not warrant under 19 U.S.C. 1520(c)(1) the reliquidation of an entry which was liquidated in accordance with the improperly implemented tariff provisions and for which liquidation has become final. Consequently, you should deny the protestant's claim for relief under 19 U.S.C.

Sincerely,

William G. Rosoff

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