HQ 225110 - Internal advice request concerning the intended purpose of CF 4811 and CF 5955a; 19 U.S.C. 1641; 19 CFR 172.1(a). - United States International Trade Commision Rulings

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HQ 225110

April 20, 1994

BRO-2-01/4-01 CO:R:C:E 225110 TLS

CATEGORY: ENTRY

District Director
U.S. Customs Service
111 West Huron Street
Buffalo, New York 14202

RE: Internal advice request concerning the intended purpose of CF 4811 and CF 5955a; 19 U.S.C. 1641; 19 CFR 172.1(a).

Dear Sir:

This office has received the above-referenced request for internal advice as provided for under Customs regulations. We have considered the request and have made the following decision.

FACTS:

A broker contends that notices of liquidated damages sent on CF 5955a must be sent directly to it by virtue of the broker having a CF 4811 on file with Customs. The CF 4811 is used for notices of liquidation, refunds, and bills. Customs routinely uses the CF 4811 to notify the broker of these matters. The CF 5955a is used to notify the importer of record and the surety of liquidated damages.

ISSUE:

Whether a broker having a CF 4811 on file with Customs requires Customs officials to notify the broker of liquidated damages as done under CF 5955a.

LAW AND ANALYSIS:

Part 24.36 of the Customs Regulations provides for the following:

(a) When it is found on liquidation or reliquidation of an entry that a refund of excessive duties or taxes, or both, is due, a refund shall be prepared in the name of the person to whom the refund is due, as determined by paragraphs (b) and (c) of this section. If the authority to mail checks to someone other than the payee, Customs Form 4811, is on file, the address of the payee shall be shown as in care of the address of the authorized persons....
(b) Refunds of excessive duties or taxes shall be certified for payment to the importer of record unless a transferee of the right to withdraw merchandise from the bonded warehouse entitled to receive the refund under section 557(b), Tariff Act of 1930, as amended, or an owner's declaration has been filed in accordance with section 485(d), Tariff Act of 1930, or a surety submits evidence of payment to Customs,... (Emphasis added.)

It is clear from the language of Part 24.36 that persons other than the importer of record may receive notice of liquidation, refund, or bill by virtue of having a CF 4811 on file with Customs indicating authorization to receive such. We note that no other use for the CF 4811 is apparent from the plain reading of 19 CFR 24.36, particularly notifying any party of liquidated damages. In fact, the CF 4811 itself lists only the following uses for the form: 1) Bills, Refunds and Notices of Liquidation; 2) Checks for Refunds or Drawback only; 3) Bills only; 4) Bills and Notices; 5) Bills and Checks; 6) Notices of Liquidation only; and Checks and Notices. The refunds referred to in Part 24.36 are for "excessive duties or taxes, or both,"; nothing in the language of the regulation suggests that Customs should read it to include refunds other than those specifically noted here. Furthermore, the CF 4811 itself is specific about what it is to be used for and no other use is implied in its format. The only other mention of CF 4811 in the regulations is under 19 CFR 174.13(c), which states that a refund request may opt to append such a request to the protest, in effect superseding a request made on CF 4811. Clearly, liquidated damages are not at issue in any of these instances.

Part 172.1(a) provides for the following:

(a) Notice of liquidated damages incurred. When there is a failure to meet the conditions of any bond posted with Customs, the principal shall be notified in writing of any liability for liquidated damages incurred by him and a demand shall be made for payment. The sureties on such bond shall also be advised in writing, at the same time as the principal, of the liability for liquidated damages incurred by the principal. (Emphasis added.)

It is also clear from the language cited here that the principal and the surety are the only parties who shall be notified according to the regulation. The broker is not mentioned at all. The principal and surety are specifically mentioned because they are the parties that stand to incur liability for failure to meet the conditions of a Customs bond. The broker does not stand to incur such liability in any instance; thus, we find no reason to require that notification be sent to the broker.

A broker has suggested a connection between the CF 4811 authorizing persons other than the importer of record to receive notices of liquidation, refunds, or bills, and the CF 5955a, which of course only is sent only to the principal under bond and the surety. The broker has not explained how these two separate documents are connected. We find no connection between the two, except that they are both Customs forms and are used to notify parties to Customs transactions of actions taken by Customs officials. No link between the two forms has been established, other than the broker's unsupported assertion that the requirements affecting the issuance of CF 4811 somehow affect the issuance of CF 5955a. Therefore, none should be inferred from the reading of 19 CFR 24.36, 19 CFR 174.13, or 19 CFR 172.1.

HOLDING:

Customs is not required to notify (pursuant to 19 CFR 172.1(a)) a broker of liquidated damages incurred because of a failure of the principal under Customs bond to meet the conditions of such bond. The CF 4811 is not intended to be used to notify the broker or any other party of liquidated damages incurred by failure to meet the conditions of a Customs bond. The CF 4811 is only to be used to notify authorized persons of liquidation, refunds of duties or taxes, or bills.

For your information, Manual Supplement 2112-04 is still effective concerning CF 28 and CF 29.

This decision should be mailed by your office to the internal advice requester no later than 60 days from the date of this letter. On that date 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, Director

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