HQ 225597 - Protest and Application for further Review No. 3004-92-100175; carbon steel plate from Japan; interest on antidumping duties; Timken Co. v. U.S.; HQ 224710 - United States International Trade Commision Rulings

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HQ 225597

September 25, 1995

LIQ-4-01-R:C:E 225597 CC

CATEGORY: LIQUIDATION

District Director
U.S. Customs Service
9901 Pacific Highway
Blaine, WA 98230

RE: Protest and Application for further Review No. 3004-92-100175; carbon steel plate from Japan; interest on antidumping duties; Timken Co. v. U.S.; HQ 224710

Dear Sir or Madam:

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

FACTS:

According to the file, the entry of the merchandise the subject of this protest was made on July 21, 1980. The merchandise entered was certain carbon steel plate from Japan.

On May 30, 1978 the Treasury Department published a finding of dumping on carbon steel plate from Japan. T.D. 78-150 (43 FR 22937). On January 2, 1980, the authority for administering the antidumping duty law was transferred from the Department of the Treasury to the Department of Commerce by the Trade Agreements Act of 1979. Notice of preliminary results of administrative review of carbon steel plate from Japan for the manufacturer under consideration (case A-588-067) were published in the Federal Register on May 7, 1981 (46 FR 25498). Notice of final results of administrative review of carbon steel plate from Japan for the manufacturer under consideration were published in the Federal Register on September 30, 1981 (46 FR 47804). The time period under consideration was for entries made from July 1, 1977 through March 31, 1980. The review disclosed that for this time period for the subject manufacturer, a 0 percent margin existed. In addition, a cash deposit for entries of carbon steel plate made on or after September 30, 1981 was required.

Prior to October 1, 1984, annual administrative reviews of antidumping orders were required by section 751 of the Tariff Act of 1930. Consequently, the Department of Commerce initiated an administrative review of its dumping findings for the subject manufacturer during the period of April 1980 through September 1981. Section 611(a)(2)(A) of the Trade and Tariff Act of 1984 amended section 751 to provide for reviews on request rather than automatically on an annual basis. 50 FR 32556 (1985). On October 18, 1985 the subject manufacturer requested that the Department of Commerce complete the administrative review of its sales of carbon steel plate during the period of April 1980 through September 1981. On April 17, 1986 the Department of Commerce published a notice revoking the antidumping finding on carbon steel plate from Japan for entries on or after October 1, 1984. 51 FR 13039. That notice did not cover unliquidated entries of steel plate from Japan which were exported prior to October 1, 1984. Furthermore, the notice stated that the Department of Commerce would address any entries not covered in a prior administrative review and exported prior to October 1, 1984, in a separate review, if one were requested.

On August 15, 1986, the subject manufacturer withdrew its request for the completion of an administrative review during the period of April 1980 through September 1981.

In January 1988, the Department of Commerce issued E-mail instruction through Customs Headquarters to field offices regarding case A-588-067. Those instructions listed various manufacturers and exporters for whom the Department of Commerce had not received a request for an administrative review of the antidumping duty order. The Department of Commerce instructed Customs to assess antidumping duties on merchandise entered, or withdrawn from warehouse for consumption, during certain periods at certain rates. The subject manufacturer was not listed.

On August 19, 1992 the Department of Commerce issued further E-mail instructions through Customs Headquarters to field offices regarding case A-588-067. In part it was stated that "[e]ffective as of the date of issuance of this email message[,] you should no longer suspend liquidation of entries covered by this email[;] you should proceed with liquidation accordingly." These instructions required entries of carbon steel plate manufactured or exported by the subject manufacturer, and entered on withdrawn from warehouse for consumption from April 1, 1980 to September 30, 1981 to be assessed antidumping duties at a rate of 6.70 percent.

The subject entry was liquidated on September 11, 1992. The protestant states that it paid antidumping duties in the amount of $2,183.04 and interest in the amount of $8,099.69 within 45 days of the liquidation date. The protest was filed on November 4, 1992. The protestant claims that at the time of entry no cash deposit of antidumping duties was required; therefore, the interest paid should be refunded. In addition, the protestant argues that it should be paid interest on the amount to be refunded.

On January 28, 1993, Customs issued an E-mail message correcting liquidation instructions for carbon steel plate from Japan, stating that no interest was to be assessed on entries that were not subject to cash deposits (i.e., entered under bond).

ISSUE:

Whether an assessment of interest on antidumping duties is proper for the subject entry?

If the amount of interest the protestant paid is to be refunded, is the protestant due interest on that amount?

LAW AND ANALYSIS:

Initially, we note that the protest was timely filed pursuant to 19 U.S.C. 1514(c).

The protest concerns the assessment of interest on the antidumping duties from the date of entry until the date of liquidation. The assessment of interest on antidumping duties is provided for in 19 U.S.C. 1677g.

Under the antidumping duty law, The Department of Commerce, not Customs, has the authority to calculate and determine antidumping duty rates. See Mitsubishi Electronics America, Inc. v. United States, 44 F.3d 973 (Fed Cir. 1994). This authority includes the Department of Commerce's determining whether interest is due pursuant to 19 U.S.C. 1677g. See Timken Co., v. U.S., 15 CIT 526, 777 F. Supp. 20 (1991).

Customs has the authority to grant or deny protestable decisions. According to 19 U.S.C. 1514(a), these include, "decisions of the Customs Service, including the legality of all orders and findings entering into the same, as to ...(5) the liquidation or reliquidation of an entry, or reconciliation as to the issues contained therein, or any modification thereof." Concerning the role of Customs in liquidating antidumping duties the court stated in Mitsubishi Electronics, supra, at page 977:

Further, Customs has a merely ministerial role in liquidating antidumping duties under 19 U.S.C. ? 1514(a)(5). Customs cannot "modify ... [Commerce's] determinations, their underlying facts, or their enforcement." Royal Business Machs., Inc. v. United States, 507 F.Supp. 1007, 1014 n.18 (Ct. Int'l Trade 1980), aff'd, 669 F.2d 692 (CCPA 1982).

Liquidation instructions for the subject entry were issued by the Department of Commerce on August 19, 1992. In that message, there are no instructions for Customs to assess interest that would apply to the subject manufacturer for the subject period. Further liquidation instructions were issued on January 28, 1993. In those instructions it is stated, "[n]o interest is assessed on entries that were not subject to cash deposits (i.e., entered under bonds). Interest shall be calculated from the date of payment of estimated antidumping duties through the date of liquidation."

For the subject entry, there was a pre-1980 antidumping finding for which no estimated dumping margins were calculated. In addition, there was no cash deposit required at the time of entry, and thereafter there was no administrative review which applied. On August 19, 1992 liquidation instructions were issued, assessing antidumping duties for the subject manufacturer for the subject period.

Consequently, a review of the liquidation instructions shows that Commerce did not instruct Customs to assess interest on antidumping duties due on the subject entry at liquidation. The liquidation of the subject entry with the assessment of interest was contrary to Commerce's instructions, and, therefore, was a protestable matter pursuant to 19 U.S.C. 1514.

Commerce's decision not to assess interest in this case is consistent with Timken, supra. In Timken, the court upheld the Department of Commerce's decision not to assess interest on antidumping duties. The factual situation in Timken was that there was a pre-1980 antidumping duty finding in which estimated dumping margins were never calculated, and there was no requirement for cash deposits at the time of entry, although some importers may have posted bonds. Final results of administrative review establishing dumping margins were not issued until 1990, some fourteen years after the original dumping finding was made. The court upheld Commerce's decision not to assess interest for that factual situation, finding that interest is collectible only on cash deposits and would accrue from the time the deposit is required, and that interest is not due on security, such as a bond. Therefore, the court found that Commerce did not misinterpret the relevant statutes concerning cash deposits and assessment of interest (19 U.S.C. 1673e(a)(3) and 19 U.S.C.

The factual situation here is similar to the one in Timken: a pre-1980 antidumping finding in which estimated dumping margins were never calculated, no cash deposit required at the time of entry, no administrative review that would have required such a deposit, and it appears, posting of a bond at the time of entry. Consequently, the Department of Commerce's decision not to instruct Customs to impose interest on antidumping duties at liquidation in this case is consistent with the Timken decision.

Based on the foregoing, we find that the assessment of interest on antidumping duties in this instance was not in conformity with the liquidation instructions issued by Commerce. Consequently, the protest concerning the issue of assessment of interest should be allowed, and the amount the protestant paid in interest should be refunded.

We note that this decision is consistent with HQ 224710 of August 16, 1993, a protest relating to antidumping duties for carbon steel plate from Japan (case A-588-067) for the same manufacturer and the same time period as this protest. Included in HQ 224710 was the issue of the assessment of interest to antidumping duties. In HQ 224710 we allowed the protest on the issue of the assessment of interest, finding that liquidation with the assessment of interest was improper.

In addition to the issue of the assessment of interest on antidumping duties, the protestant has raised another issue. The protestant states that it paid antidumping duties in the amount of $2,183.04 and interest in the amount of $8,099.69 within 45 days of the liquidation date, September 11, 1992. The protestant argues that it should receive, in addition to a refund of the interest paid, interest on the $8,099.69, calculated from the date Customs received that amount.

19 U.S.C. 1505(c) was amended by section 642, title VI - Customs Modernization, Public Law 103-182, the North American Free Trade Agreement Implementation Act (107 Stat. 2057), enacted December 8, 1993. In addition, section 642 repealed 19 U.S.C. 1520(d). Title VI of Public Law 103-182 took effect on the date of enactment of the Act (section 692 of the Act). Since entry the subject of this protest occurred prior to the date of enactment, the amended law does not apply in this instance. See HQ 225576 of November 15, 1994.

19 U.S.C. 1520(d) provides in part, the following:

If a determination is made to reliquidate an entry as a result of a protest filed under section 1514 of this title, ..., interest shall be allowed on any amount paid as increased or additional duties under section 1505(c) of this title at the annual rate established pursuant to that section and determined as of the 15th day after the date of liquidation or reliquidation....

In order for the protestant to receive the relief granted, there must have been paid increased or additional duties under 19 U.S.C. 1505(c). The protestant is seeking payment of interest on the $8.099.69 paid; in other words, the protestant is seeking payment of interest on the interest paid. Thus, this amount does not represent increased or additional duties paid under section 505(c). The relevant statutes cited above do not provide for the payment of interest on the interest paid (in this case, the $8,099.69 paid by the protestant). See HQ 221692 of December 3, 1990. Consequently, the protestant's request for payment of interest on the $8,099.69 is denied.

HOLDING:

The protest is allowed and denied in part. The protest is ALLOWED concerning the issue of liquidation of the subject entry with the assessment of interest on antidumping duties. Therefore the interest on the antidumping duties paid by the protestant should be refunded.

The protest is DENIED for the protestant's request for payment of interest on the $8,099.69 to be refunded.

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 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, Freedom of Information Act and other public access channels.

Sincerely,

John Durant, Director

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