HQ 546141 - Request for Internal Advice; (Formerly Protest and Application for Further Review (170395200049)); Sensitized Metal Plates; 19 U.S.C. 1401a(b)(4)(A); 19 U.S.C. 1514; 19 U.S.C. 1520(c). - United States International Trade Commision Rulings

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HQ 546141

April 16, 1996
RR:IT:VA 546141 er
CATEGORY: VALUATION

Port Director
Savannah, GA

RE: Request for Internal Advice; (Formerly Protest and Application for Further Review (170395200049)); Sensitized Metal Plates; 19 U.S.C. 1401a(b)(4)(A); 19 U.S.C. 1514; 19 U.S.C. 1520(c).

Dear Sir:

This is in response to the above-referenced protest which was received by this office on September 18, 1995. For the reasons explained below, the protest will be treated as a request for internal advice. All pricing information appearing in this decision is bracketed and will be deleted from the published version. We regret the delay in responding.

FACTS:

The imported merchandise consists of sensitized metal plates purchased by Mitsubishi International Corporation in the U.S. ("Mitsubishi U.S.) from Mitsubishi Corporation in Japan ("Mitsubishi Japan"). The merchandise was imported on September 24, 1994, and the entry was liquidated on January 6, 1995. The invoice presented at the time of entry reflected the value for parts number SDP-RHN125SPEC28R 17-15/16" 2 rolls/box as [$xxxxxxxxxxxxxxxx per unit)]. According to Mitsubishi U.S., after entry and payment of duties, Mitsubishi U.S. discovered that the value listed on the invoice prepared by Mitsubishi Japan was incorrect. The claimed correct value is [xxxxxxxxxxxxxxxx per unit)].

The merchandise was appraised under transaction value based on the amount reflected on the invoice presented at the time of entry. Mitsubishi U.S. first protested the appraisement of the goods under the authority of 19 U.S.C. 1514. That protest (170395100024) was timely filed on February 10, 1995, a copy of which was submitted to this office. Customs denied the protest on April 19, 1995, because Customs believed that the difference between the declared value and the claimed value was the result of a post importation price adjustment or rebate within the meaning of 19 U.S.C. 1401a(b)(4)A).

Mitsubishi U.S. now submits that the protest should not have been made under the authority of 19 U.S.C. 1514 because the issue does not involve a construction of law. Mitsubishi U.S. asserts that because the difference in price came about as a result of clerical error, the matter should have been petitioned under 19 U.S.C. 1520(c). In a written submission dated August 30, 1995, Mitsubishi U.S., accordingly, petitioned for relief under 19 U.S.C. 1520(c) with your office. The petition is attached to the Customs Protest and Summons Information Report prepared by you on September 11, 1995 and received by this office on September 18, 1995.

A copy of a letter from Mitsubishi Japan dated August 10, 1995, to Mitsubishi U.S. is included with the petition. That letter states that the wrong unit price was indicated on the invoice for the subject entry and describes how Mitsubishi Japan issued a revised invoice and reimbursed Mitsubishi U.S. an amount representing the difference between the incorrect and correct invoices. Also submitted were copies of a revised invoice reflecting the corrected value and a credit memo to Mitsubishi U.S. The credit memo reflects an amount of [xxxxxxx], representing the difference between the value declared at the time of entry [(xxxxxxxx)] and the claimed correct value [(xxxxxxxx)]. Mitsubishi U.S., accordingly, requests reliquidation of the entry and a refund under 19 U.S.C. 1520(c).

ISSUE:

Under the circumstances presented, whether relief can be granted under section 520(c)(1) of the TAA?

Whether the post importation change in the invoiced amounts represents a rebate within the meaning of section 402(b)(4)(A) of the TAA?

LAW AND ANALYSIS:

Under section 514(a), Tariff Act of 1930, as amended (TAA; 19 U.S.C. 1514(a)), a protest may be filed against, among other things, "the appraised value of merchandise". Under paragraph (c)(2) of section 514, a protest of a decision, order, or finding described in paragraph (a) of section 514 must be filed within 90 days after the notice of liquidation or reliquidation or the date of the decision as to which the protest is made.

Under section 520(c)(1) TAA (19 U.S.C. 1520(c)(1)):

Notwithstanding a valid protest was not filed, [Customs] may, in accordance with regulations prescribed by the Secretary, reliquidate an entry to correct ... (1) a clerical error, mistake of fact, or other inadvertence not amounting to an error in the construction of a law, adverse to the importer and manifest from the record or established by documentary evidence, in any entry, liquidation, or other customs transaction , when the error, mistake, or inadvertence is brought to the attention of [Customs] within one year after the date of liquidation or exaction...

In reviewing the file, we note that while you did deny the timely filed 514 protest you have not denied the 520(c) petition; accordingly, this office does not have jurisdiction over the matter and the submission should not be treated as an application for further review of a protest. See generally, Customs Directive 3550-39 "Protest Processing" dated January 16, 1991. Under the circumstances, and because you appear to be requesting guidance as to the proper application of Customs laws with respect to a specific transaction, we will treat this matter as a request for internal advice within the meaning of section 177.11, Customs Regulations (19 CFR 177.11).

Transaction value, the preferred method of appraisement, is defined in section 402(b) of the Trade Agreements Act of 1930, as amended ("TAA"), as "the price actually paid or payable for the merchandise when sold for exportation to the United States...", plus certain statutory additions. (19 U.S.C. 1401a(b))

The "price actually paid or payable" is defined in section 402(b)(4)(A) of the TAA as "the total payment (whether direct or indirect, and exclusive of any costs, charges, or expenses incurred for transportation, insurance, and related services incident to the international shipment of the merchandise from the country of exportation to the place of importation in the United States) made, or to be made, for the imported merchandise by the buyer to, or for the benefit of, the seller." (19 U.S.C.

Section 402(b)(4)(B) of the TAA provides that "[a]ny rebate of, or other decrease in, the price actually paid or payable that is made or otherwise effected between the buyer and seller after the date of importation of the merchandise into the United States shall be disregarded in determining the transaction value ..." of the imported merchandise. (19 U.S.C. 1401a(b)(4)(B)) The corresponding Customs regulation is found at 19 CFR 152.103(a)(4).

Based on our review of the file and the evidence presented, we find that the corrected invoiced amounts do not represent post importation price adjustments or rebates within the meaning of section 402(b)(4)(B) of the TAA. Mitsubishi U.S. and Mitsubishi Japan did not intend to effect a decrease in the price actually paid or payable after the time of importation; instead, the documentation presented reveals that the change in the invoiced values represents a clerical error which was subsequently corrected. As described above, the documentation presented for our review includes a revised invoice, a letter from Mitsubishi Japan explaining the nature of the error, and a credit note. Based upon the review of this documentation, we are satisfied that the change in the invoiced values is the result of the correction of a clerical error. Given these circumstances, you should reliquidate the entry at the corrected invoiced amount and refund the overpayment of duty and fees.

HOLDING:

Based upon our review of the facts, we have determined that this matter is more properly treated as a request for internal advice, as described in 19 CFR 177.11, rather than as an application for further review of a protest. After reviewing the documentation submitted by the importer, we find that the change in invoiced values is not a post importation price adjustment or rebate within the meaning of section 402(b)(4)(B). The change in values, instead, represents a
clerical error. You should, accordingly, reliquidate the entry at the corrected invoiced amount and refund the overpayment of duty and fees.

Sincerely,

Acting Director, International
Trade Compliance Division

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