HQ 0224618 - Application for further review of Protest No. 2704-93- 100499; Interest; Antidumping duties; 19 U.S.C. 1677g(a); 19 CFR 353.24(c); Timken Co. v. United States, 777 F. Supp. 20 (CIT 1991) - United States International Trade Commision Rulings

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HQ 224618

May 26, 1994

ENT-1-03/LIQ-4-01-CO:R:C:E 224618 JRS

CATEGORY: ENTRY LIQUIDATION

District Director of Customs
ATTN: Protest Review Unit
300 South Ferry Street, Terminal Island
San Pedro, California 90731

RE: Application for further review of Protest No. 2704-93- 100499; Interest; Antidumping duties; 19 U.S.C. 1677g(a); 19 CFR 353.24(c); Timken Co. v. United States, 777 F. Supp. 20 (CIT 1991)

Dear Sir:

The above-referenced protest was forwarded to this office for further review. We have considered the issue raised and our decision follows.

FACTS:

This protest involves three entries filed on November 15, 1983, December 16, 1983 and January 13, 1984, on importations of pressure sensitive plastic tape manufactured by Comet, S.A.R.A., Italy. This merchandise is subject to an affirmative antidumping finding (T.D. 77-258) published on October 21, 1977 (42 FR 56110). The Trade Agreements Act of 1979 transferred the administration of the antidumping laws from the Department of the Treasury to the Department of Commerce on January 2, 1980. Annual administrative reviews of antidumping findings issued by Treasury were required by section 751 of the Tariff Act of 1930. On August 5, 1983, the International Trade Administration, Department of Commerce, issued its notice of Final Results of Administrative Review of Antidumping Finding [A-475-059] in the Federal Register (48 FR 35686-35688). Therein, Customs was instructed to assess antidumping duties against all subject entries (including Comet) of said merchandise at the margin of 2.79% and to require a cash deposit of estimated antidumping duties based on the 2.79% margin entered or withdrawn from warehouse, for consumption on or after the date of publication of the notice in the Federal Register. This margin was in effect at the time each of the three entries were filed. No antidumping duty deposit, however, was presented with any of the entries.

Customs issued CIE 2/90, dated August 6, 1990, relating to suspension of liquidation and liquidation instructions from the original Department of Commerce (DOC)'s telexes that were published during the period of 12/3/85 through 1/23/88 on the applicable rates and periods for the various manufacturers and exporters for whom DOC had not received a request for an administrative review for certain antidumping duty findings, including A-475-059. DOC stated that interest shall be calculated from the date of payment of estimated duties through the date of liquidation only for those entries made after January 1, 1980. The 1979 Act introduced both the provision requiring actual cash deposits of estimated dumping duties pending liquidation (19 U.S.C. 1673e(a)(3)) and the corresponding provision requiring the imposition of interest whenever the estimated duties on deposit differed from the actual duties due (19 U.S.C. 1677g(a)).

All three entries were liquidated on November 20, 1992, with an increase of duties, which included both the 2.79% antidumping duty margin and interest on these duties from the dates of entry to the date of liquidation. The importer filed a protest on February 9, 1993, against the assessment of interest.

It is the protestant's argument that no interest can be charged because no antidumping deposit was made. As authority for his position, the protestant cites Timken Co. v. United States, 777 F. Supp. 20 (CIT 1991) and states that "[i]n Timken, it was decided that interest cannot be charged against unpaid anti-dumping duties when no deposit was made."

ISSUE:

Whether interest is properly assessed on liquidation of an entry for which an importer did not make the required cash deposit specified in an Antidumping Duty Order or Finding or, an Administrative Review relating to such Order or Finding.

LAW AND ANALYSIS:

We note that the protest was timely filed on February 9, 1993, in accordance with 19 U.S.C. 1514(c)(2)(A), and is a protestable decision under 19 U.S.C. 1514(a)(5) because it does not fall within the exception of 19 U.S.C. 1514(b) as the protestant challenges the assessment of interest on antidumping duties and not the antidumping duty determination itself.

Section 778 of the Tariff Act, as amended by the Trade Agreements Act of 1979 (19 U.S.C. 1677g(a)), states the general rule on interest:

Interest shall be payable on overpayments and underpayments of amounts deposited on merchandise entered, or withdrawn from warehouse, for consumption on and after --

(1) the date of the publication of a countervailing or antidumping duty order under this subtitle or section 1303 of this title, or

(2) the date of a finding under the Antidumping Act, 1921.

19 U.S.C. 1677g(a)(1992 supp.)(Underlining added). This provision contemplates situations where a cash deposit is required to have been made upon entry, rather than where a bond is required because interest is only collectable on cash deposits.

The Commerce Regulation, 19 CFR 353.24(c), provides that interest is to be calculated "from the date that a cash deposit is required to be deposited for the entry through the date of liquidation of the entry." We agree with the Customs district office's position that "date ... required" refers to the date that a notice to the public (published in the Federal Register) requires a cash deposit to be made on the particular class of merchandise. A cash deposit of zero is a cash deposit for the purpose of assessing interest. If a pre-1980 Antidumping Duty Order or Finding is silent about deposit, the Customs district office believes that interest does not accrue on entries filed prior to the date that deposit instructions are finally published. We are in agreement.

At the time of the filing of the 3 protested entries in this case, however, cash deposits of 2.79% were required pursuant to the 1983 administrative review under section 751 of the pre-1980 Antidumping Finding. It is our opinion that even if the importer did not make the required deposit at the time of entry or the deposit was zero, so long as the importer remains liable for the antidumping duties, interest is applicable. Thus, interest is properly assessed against the 3 entries. Customs must assess interest on underpayments (including nonpayment of antidumping duties) or pay interest on overpayments of the required cash deposits for entries made after 1980. The failure of the protestant to make the required cash deposit does not excuse him from the payment of interest on his nonpayment of the required cash deposit of 2.79%. He remains liable for the interest notwithstanding his nonpayment or underpayment.

We are in agreement with Customs Los Angeles district's position that even if the importer failed to adhere to the publication of the deposit instructions and Customs failed to compel adherence, interest accrues on any subject entry filed after publication of the instructions.

We reject the protestant's reliance on Timken, supra, for the following reasons. In Timken, the entries were filed before the dumping margins were established by Commerce in its notice of final results on June 1, 1990. In contrast, the entries in this protest were filed after the margin had been established and published in the Federal Register on August 5, 1983 (i.e., between November 15, 1983 and January 13, 1984). Secondly, in Timken, there was no requirement to deposit cash at the time the entries were filed, whereas in this protest, the final results of an administrative review pertaining to pressure sensitive plastic tape from Italy specifically required a cash deposit of 2.79% of antidumping duties for entries (Comet) filed on or after August 5, 1983. (48 FR 35688). Finally, in Timken, Commerce instructed Customs not to assess interest on the entries at the time of liquidation. The reasoning was that the merchandise was entered upon security (bonds), including the entries made after 1980, and therefore, according to Commerce, interest cannot be imposed pursuant to 19 U.S.C. 1677g. In this case, the liquidation instructions from Commerce (reissued by Headquarters as CIE 2/90 on August 6, 1990) specifically advised the field to assess interest because cash deposits were required.

Interest is properly assessed, in accordance with 19 CFR 353.24(b), on the underpayment (technically nonpayment in this case) of duties for the protested entries represented by the difference between the cash deposit of estimated antidumping duties on the date of entry (that is, the deposit of $0 dollars by the importer) and the final amount of assessed dumping duties due on the date of liquidation.

HOLDING:

Interest is properly assessed on liquidation of an entry for which an importer did not pay the required cash deposit at the time of entry specified in the final results of an administrative review relating to an antidumping duty finding.

Therefore, you are instructed to DENY the protest. In accordance with Section 3A(11)(b) of Customs Directive 099 3550- 065, dated August 4, 1993, Subject: Revised Protest Directive, a copy of this decision should be mailed by your office to the protestant no later than 60 days from the date of this letter along with the Customs Form 19, Notice of Action. Any reliquidation of the entry in accordance with the decision must be accomplished prior to mailing of the decision. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, Lexis, Freedom of Information Act and other public access channels.

Sincerely,

John Durant, Director

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