HQ 224759 - Protest for Further Review Number 0901-92-101704; concerning the liquidation of entries subject to antidumping duties (ADD); Deemed Liquidated under 19 U.S.C. 1504; American Permac, Inc. v. U.S., 10 CIT 535 (1986); Nunn Bush Shoe Co. and Weyco Group Inc. v. United States, 784 F. Supp. 892 (CIT 1992); Canadian Fur Trappers Corp. v. United States, 12 CIT 612 (1988) - United States International Trade Commision Rulings

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HQ 224759

July 6, 1994

LIQ-4-01:CO:R:C:E 224759 SR

CATEGORY: LIQUIDATION

District Director of Customs
111 W. Huron Street
Buffalo, NY 14202-2378

RE: Protest for Further Review Number 0901-92-101704; concerning the liquidation of entries subject to antidumping duties (ADD); Deemed Liquidated under 19 U.S.C. 1504; American Permac, Inc. v. U.S., 10 CIT 535 (1986); Nunn Bush Shoe Co. and Weyco Group Inc. v. United States, 784 F. Supp. 892 (CIT 1992); Canadian Fur Trappers Corp. v. United States, 12 CIT 612 (1988)

Dear Sir:

The above-referenced protest was forwarded to this office for further review. We have considered the points raised by your office and the protestant. Our decision follows.

FACTS:

Coyne Textile Services is the importer of record for two entries of cotton shop towels from China; one was entered on August 10, 1988, and the other was entered September 28, 1988. Liquidation was suspended while the merchandise at issue was under an administrative review by the Department of Commerce to determine if antidumping duties should be assessed.

The Department of Commerce published the preliminary results of the antidumping duty administrative review on the subject merchandise for which antidumping duties were found to be due. (56 Federal Register 4020 (February 1, 1991)). The Federal Register Notice, at page 4042, stated that

The Department shall determine, and the Customs Service shall assess, antidumping duties on all appropriate entries. Individual differences between United States price and foreign market value may vary from the percentage stated above. The Department will issue appraisement instructions directly to the Customs Service.

Notice was sent from the Department of Commerce on May 26, 1992 (CIE N-129/82) directing Customs to liquidate the entries at a rate of 55.27 percent of the U.S. price. The entries were liquidated on July 24, 1992.

The protestant claims that the suspension is automatically lifted as of the date of the Federal Register Notice. Because the merchandise was liquidated almost one-and-a-half years after the date of the Federal Register Notice, and Customs did not issue an extension notice, the protestant states that the merchandise should be deemed liquidated by operation of law.

ISSUE:

Whether the subject entries were deemed liquidated by operation of law.

LAW AND ANALYSIS:

Liquidation has been defined as "the final computation by the Customs Service of all duties (including any antidumping or countervailing duties) accruing on that entry." American Permac, Inc. v. United States, 10 CIT 535, 537 ((1986). Customs is bound by certain time limits during which liquidation must occur under 19 U.S.C. 1504.

Generally, an entry of merchandise not liquidated within one year "shall be deemed liquidated at the rate of duty, value, quantity, and amount of duties asserted at the time of entry by the importer of record." 19 U.S.C. 1504(a). Liquidation may be extended under 19 U.S.C. 1504(b) for the following reasons:

Extension of liquidation is provided for under 19 U.S.C. 1504 as follows:

(b) Extension.--The Secretary may extend the period in which to liquidate an entry by giving notice of such extension to the importer, his consignee, or agent in such form and manner as the Secretary shall prescribe in regulations, if- (1) information needed for the proper appraisement or classification of the merchandise is not available to the appropriate customs officer;
(2) liquidation is suspended as required by statute or court order; or
(3) the importer, consignee, or his agent requests such extension and shows good cause therefor.

(d) Limitation.--Any entry of merchandise not liquidated at the expiration of four years from the applicable date specified in subsection (a) of this section shall be deemed liquidated at the rate of duty, value, quantity, and amount of duty asserted at the time of entry by the importer, his consignee, or agent, unless liquidation continues to be suspended as required by statute or court order. * * *

In this case liquidation was properly suspended under 19 U.S.C. 1673b(d)(1). The protestant states that the suspension was lifted on February 1, 1991, the date of the Federal Register Notice; and therefore, Customs should have sent an extension notice since it did not liquidate for more than a year. However, it is Customs position that the suspension was not lifted until Customs was instructed by the Department of Commerce on May 26, 1992. As stated in the Federal Register (see quote in the facts above) the Department of Commerce may find individual differences between the U.S. price and the foreign market value which may vary from the percentage provided in the Federal Register Notice. Until the proper percentage rate assessment is provided, Customs is unable to liquidate the merchandise.

Under 19 U.S.C. 1504(a) and (d) merchandise is deemed liquidated by operation of law four years from the date of entry unless liquidation continues to be suspended by statute or court order. In this case the suspension was lifted by the notification from Commerce to Customs on May 26, 1992; the third year of the suspension. The merchandise was liquidated less than 60 days after the suspension was lifted. Liquidation occurred less than one month before the four year anniversary of the date of entry for the first entry and approximately 2 months before the anniversary date of the second entry. The entries would not be deemed liquidated under 19 U.S.C. 1504(d).

A similar fact pattern was addressed by the Court of International Trade (CIT) in Nunn Bush Shoe Co. and Weyco Group Inc. v. United States (Nunn Bush), Slip Op. 92-9, Customs Bulletin and Decisions, vol. 26, no. 7, p. 19 (February 12, 1992), 784 F. Supp. 892. Nunn Bush dealt with entries which had been suspended pending the results of a countervailing duty investigation and later pursuant to a court injunction. The injunctions were dissolved before the entries were four years old, but in this case Customs did not liquidate certain of these entries until after four years from the date of entry.

In Nunn Bush, the CIT discussed their decision in Canadian Fur Trappers Corp. v. United States (Fur Trappers), 12 CIT 612 (1988). Fur Trappers also involved the application of 19 U.S.C. 1504(d). In that case the suspension of the entries was lifted
after the four years had expired. The CIT stated that when a suspension is lifted after the four years have passed, Customs has a discretionary period in which to liquidate the entries. Nunn Bush, p. 21-22. The Nunn Bush court held that entries not subject to a statutory or court ordered suspension of liquidation when they turned four years old were deemed liquidated by operation of law. Here, however, the two entries were liquidated before they turned four years old. Further, the amendments made in section 641 of the North American Free Trade Agreement Implementation Act (Act of December 8, 1993, 107 Stat 2057, Pub. L. 103-182) do not apply since the entries here were made before the effective date of the act.

HOLDING:

The suspension was lifted by the notification from Commerce to Customs on May 26, 1992; the third year of the suspension. The entries were liquidated before the four-year anniversary of the date of entry and therefore would not be deemed liquidated under 19 U.S.C. 1504(d). The protest is 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. Any reliquidation of the entry in accordance with this decision must be accomplished prior to the mailing of the decision. Sixty days from the date of this 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 to the public via the Diskette Subscription Service, Lexis, Freedom of Information Act and other public access channels.

Sincerely,

John Durant

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