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HQ 226273




February 24, 1997

LIQ-9-01-RR:IT:EC 226273 PH

CATEGORY: LIQUIDATION

Port Director of Customs
819 Water Street, Building # 6
Laredo, Texas 78040
ATTN: Protest Section

RE: Internal Advice 26/95; Protest No. 2304-95-100045; Claim for Preferential Tariff Treatment under NAFTA; 19 U.S.C. 1514; 19 U.S.C. 1520(d)

Dear Sir or Madam:

The above-referenced internal advice request was forwarded to this office for our consideration. We have considered the evidence provided and the arguments made on behalf of the importer, as well as Customs records relating to this matter. Our decision follows.

[This ruling does not address the proposal by counsel for the importer that excess quota certificate quantities be cumulated for use on another entry (the decision in the ruling regarding the applicability of the procedures for NAFTA Post-Importation Duty Refund Claims when a claim for preferential tariff treatment was made at the time of importation and granted makes a decision on the quota-cumulation issue unnecessary for purposes of the entries, claim, and protest involved in this case). We are forwarding a copy of your request and this ruling to Mr. Jerry Laderberg, Chief of the Entry & Carrier Rulings Branch of this office (Telephone: 202-482-6940) for appropriate action on the quota-cumulation issue raised in this matter.]

FACTS:

According to the file, the importer in this matter imported certain shipments of orange juice from Mexico during calendar year 1994. The merchandise under consideration in this matter was entered on 16 entries, under subheadings MX9906.20.07 and MX2009.11.0060, Harmonized Tariff Schedule of the United States (HTSUS), with duty at the rate of 9.019 cents/liter. The dates of importation of the merchandise under consideration were between March 20, 1994 and May 20, 1994. The entries were liquidated between July 22, 1994, and September 23, 1994.

By letter of December 22, 1994, the broker of the importer requested reliquidation of 7 of the 16 entries under consideration. According to this letter:

The above referenced entries were imported with NAFTA treatment and high rate duty (9.019 [cents]/Lt) as no quota coupons were available at the time of filing the Entry Summary. Please find attached original quota coupons, copies of CF 7501 and shipper invoices. We respectfully request reliquidation of these entries with the low rate [of] duty (4.625 [cents]/Lt) for the amount of [liters] covered by their respective coupon[s].

By letter of December 27, 1994, Customs denied this request, stating:

Supplement 1 to NAFTA Fact Sheet #25 stipulates that the Export Quota Certificate must be presented with the entry summary. Once liquidation has occurred, the only way you can submit the certificate is [illegible] using the protest procedures outlined in 19 CFR 174.12. This means that protest[s] have to be presented within 90 days from date of liquidation.

On March 22, 1995, the importer filed a protest (2304-95-100045), under 19 U.S.C. 1514, against the refusal of Customs to reliquidate the entries for which reliquidation was requested in the December 22, 1994, letter, described above. Suspension of the protest was requested, pending a decision on the importer's Post-Importation NAFTA Duty Refund Claim dated March 21, 1995. According to Customs records, action on the protest has been suspended.

The March 21, 1995, Post-Importation NAFTA Duty Refund Claim, referred to in the protest (see above), seeks refunds of "excess Customs duties" for the 16 entries under consideration. According to the claim, although the merchandise qualified for the benefits of the NAFTA "low-tier" rate of duty, the "high-tier" rate of duty was required to be paid because no NAFTA Quota Certificates were available at the time of entry (according to the brief of counsel on behalf of the importer (see also Office of Trade Operations FACT SHEET 25, February 3, 1994 (4034072), copy enclosed), the requirement for the certificates was effective on or after February 7, 1994, but no certificates were available until March 25, 1994). Certificates of Origin and NAFTA Export Quota Certificates were submitted with the claim.

The claim also seeks cumulation of the quantities of merchandise covered by the NAFTA Quota Certificates. If cumulation is allowed, the importer claims that the Quota Certificates involved cover 98,889 liters not needed for the entries to which the Quota Certificates were applied. The importer seeks to have this excess quantity applied to another entry, on which the NAFTA high-tier rate of duty was paid.

ISSUE:

May a NAFTA Post-Importation Duty Refund Claim be granted when a claim for preferential tariff treatment was made at the time of importation and was granted?

LAW AND ANALYSIS:

Under 19 U.S.C. 1520(d), notwithstanding that a valid protest was not filed, Customs may reliquidate an entry to refund any excess duties paid on a good qualifying under the NAFTA rules of origin for which no claim for preferential tariff treatment was made at the time of importation if the importer, within 1 year after the date of importation, files a claim meeting certain conditions (emphasis supplied). The conditions required to be met for a claim filed under section 1520(d) are that the claim must include a written declaration that the good qualified under the NAFTA rules of origin at the time of importation, copies of all applicable NAFTA Certificates of Origin, and such other documentation relating to the importation of the goods as is required by Customs. The Customs Regulations promulgated under this provision are found in 19 CFR 181.31 through 181.33 (see also General Notice on Post-Importation Duty Refund Claims Under the NAFTA, January 29, 1997, Customs Bulletin and Decisions, vol. 31, no. 5, page 1). As in the statute (see underlined material above), the Customs Regulations require as a condition precedent to relief under this provision that "no claim for preferential tariff treatment on that originating good was made at that time [i.e., when the good was imported into the United States]" (19 CFR 181.31).

In this case the above condition precedent to relief under 19 U.S.C. 1520(d) is not met. A claim for preferential tariff treatment was made at the time of importation and that claim was granted. That is, the Most Favored Nation rate of duty for the merchandise under consideration at the time under consideration was 9.25 cents per liter (subheading 2009.11.00, 1994 HTSUS). The high tier NAFTA rate of duty for such merchandise from Mexico was 9.019 cents per liter (subheading 9906.20.07, 1994 HTSUS), and the low-tier NAFTA rate of duty for such merchandise from Mexico was 4.625 cents per liter (subheading 9906.20.06, 1994 HTSUS). The merchandise under consideration was entered under subheading 9906.20.07, HTSUS (on the entry summaries for the merchandise, classification is stated as "MX9906.20.07" and "MX2009.11.0060"), with duty at the rate of 9.019 cents per liter.

Therefore, the importer's March 21, 1995, Post-Importation NAFTA Duty Refund Claim must be DENIED. On the same basis, the protest (2304-95-100045) of the denial of the importer's December 22, 1994, request for reliquidation of 7 of the 16 entries under consideration should also be denied (we note that one of these 7 entries (25...924-1) was liquidated 90 days before the date of the December 22, 1994, broker's request for reliquidation; even if this request was filed on the same date, if it was treated as a sufficient protest under 19 U.S.C. 1514, it was denied by the December 27, 1994, letter from Customs). We note that this decision is consistent with Supplement 1 to Office of Trade Operations FACT SHEET 25, February 4, 1994 (4035071), and Office of Trade Operations FACT SHEET 38, May 23, 1995 (5143071), copies enclosed.

HOLDING:

A NAFTA Post-Importation Duty Refund Claim may not be granted when a claim for preferential tariff treatment was made at the time of importation and was granted.

The Office of Regulations and Rulings will take steps to make this 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 60 days from the date of this decision.

Sincerely,

Director, International

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