HQ 0224809 - Protest No. 0201-93-100201; Mistake of Fact; Substitution of Consumption Entry for TIB; 19 U.S.C. 1520(c)(1) - United States International Trade Commision Rulings

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HQ 224809

October 22, 1993

LIQ-9-01-CO:R:C:E 224809 SLR

CATEGORY: LIQUIDATION

District Director
U.S. Customs Service
Main and Stebbins Streets, PO Bldg.
P.O. Box 1490
St. Albans, VT 05478

RE: Protest No. 0201-93-100201; Mistake of Fact; Substitution of Consumption Entry for TIB; 19 U.S.C. 1520(c)(1)

Dear Sir:

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

FACTS:

A temporary importation bond (TIB) was filed under subheading 9813.00.65, of the Harmonized Tariff Schedules of the United States Annotated (HTSUSA) for the subject merchandise on June 25, 1992. The merchandise consists of equipment and theatrical effects exported to Canada from the U.S. for performances by the "Kirov Ballet" and subsequent return.

On January 13, 1993, protestant submitted a request for permission to substitute a consumption entry for the TIB entry alleging mistake of fact. This request was denied on February 25, 1993. The subject protest was filed on April 30, 1993. Protestant alleges that a TIB entry was not intended by the importer but, that due to a misunderstanding, a TIB entry was filed rather than a consumption entry. Protestant contends that this is a mistake of fact remediable under 19 U.S.C. 1520(c)(1).

ISSUE:

Whether a consumption entry may be substituted for a TIB entry under 19 U.S.C. 1520(c)(1).

LAW AND ANALYSIS:

Initially, we note that the protest, with application for further review, was timely filed under the statutory and regulatory provisions for protests (see 19 U.S.C. 1514 and 19 CFR Part 174).

There is no regulatory or statutory authority to grant protestant the relief sought. The Customs regulations allow for the substitution of a TIB entry for a consumption entry. Specifically, 19 CFR 10.31(g) provides:

(g) Claim for free entry under Chapter 98, . may be made for articles of any character described therein which have been previously entered under any other provision of law and the entry amended accordingly upon compliance with the requirements of this section, provided. . . or even though released from Customs custody if it is established that the original entry was made on the basis of clerical error, mistake of fact, or other inadvertence within the meaning of section 520(c)(1), ....

Therefore, the regulation is very specific in setting forth under what circumstances substitution will be permitted. There is nothing in the pertinent regulation to indicate that substitution of a consumption entry for a TIB entry is permitted.

Protestant contends that, under 19 U.S.C. 1520(c)(1), Customs has the authority to grant substitution of a consumption entry for a TIB entry based on mistake of fact. The statutory provision in question states:

(c) Reliquidation of entry

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

(1) a clerical error, mistake of fact, or other inadvertence not amounting to an error in the construction of the law, ....

TIB entries are never liquidated. 19 CFR 10.31(h). Consequently, an entry which is never liquidated cannot be reliquidated. The correct procedure to follow when an importer finds that the TIB entry was not proper is to so inform the District Director of Customs. The bond is then considered as being breached and liquidated damages are assessed. The district director will consider the circumstances when arriving at a decision on whether or not (and if so, how much) to mitigate the liquidated damages in relation to duties that would have been payable on the ordinary consumption entry. HQ 723561/726002 dated August 13, 1984.

HOLDING:

A consumption entry cannot be substituted for a TIB entry under 19 U.S.C. 1520(c) (1) since there has been no liquidation. This protest should be denied.

In accordance with Section 3A(11) (b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed by your office to the protestant no later than 60 days from the date of this letter. 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
Commercial Rulings Division

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