HQ 228108 - Protest and Application for Further Review No. 1901-97-100051; Immediate Delivery Procedures; Liquidation - United States International Trade Commision Rulings

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HQ 228108

July 27, 1998

LIQ-1/PRO-2-04 RR:CR:DR 228108 CB

CATEGORY: LIQUIDATION

Port Director
U.S. Customs Service
Mobile, Alabama 36652

RE: Protest and Application for Further Review No. 1901-97-100051; Immediate Delivery Procedures; Liquidation

Dear Sir/Madam:

The above-referenced protest was forwarded to this office for a determination. We have considered the points raised and a decision follows.

FACTS:

In December, 1996, Immediate Delivery year-end procedures were published for the two-week window in which a filer can elect the entry date in order to take advantage of the best duty rate, e.g., 1996 or 1997 rates. The authority extended to shipments released December 17 through December 31, 1996.

The instructions provided that, in those instances where the CF 3461/3461(ALT) was used as the entry and the importer wanted to use the immediate delivery ("ID") procedure, the CF 3461/3461(ALT) had to be marked to reflect the change to ID. The instructions further provided that in order to clearly indicate that the ID procedure was being used, the filer had to blackout the word "ENTRY" and highlight "IMMEDIATE DELIVERY" on the CF 3461, and attach a sheet to the CF 7501 package stating, "This entry filed as an immediate delivery CF 7501 summary; ref: 19 CFR 141.69/142.22". Once the filer indicated that the ID procedure was being used, he/she could elect a date of entry in order to take advantage of tariff changes and special programs. Under ID procedures, the entry/entry summary must be filed within 10 working days.

The subject shipment arrived in Gulfport, Mississippi on December 25, 1996. Protestant filed an entry on December 26, 1996 and received a paperless release. The estimated arrival date was December 26, 1996. On January 8, 1997, protestant submitted the entry summary using the 1997 duty rates. Protestant admits that it did not indicate on the CF 3461 that it was electing the ID procedure. Additionally, the ABI submission of the CF 7501 information shows December 26, 1996 as the "entry date/comp" date. According to your office, the marking on the CF 3461 and the choice of the entry date/comp date are the only two possible ways of achieving the 1997 rates of duty for merchandise entered under the ID procedures. There was no indication anywhere on the entry packet that the broker was requesting the 1997 rates.

Subsequent to the filing of the entry, the broker realized that the incorrect importer number and name had been used. A change was requested in writing. When Customs attempted to make the requested changes, the system rejected the entry because the wrong duty rate had been paid, i.e., 1997 rate on a 1996 entry. Customs liquidated the entry with an increase to assess the additional duties. The subject protest was filed thereafter.

It is protestant's contention that it was Customs error in re-keying the entry when changing the importer of record that created the confusion. Protestant maintains that the entry it prepared and paid was correct under the year-end ID procedures. It was only when Customs changed the initial entry records and re-input the entry, did the duty rate become a problem. Further, protestant maintains that when the CF 7501 was submitted, "it was clearly made out to reflect release under an ID permit and not an Entry Permit. . . ." Moreover, that since the ACS systems accepted the entry and a copy of the paperless CF 3461 was not required to be submitted with the Entry Summary package, protestant feels that the failure to notate "ID Permit" on a paperless CF 3461 should not negate its intent of obtaining release under the 1997 duty rate.

ISSUE:

Should the subject protest be granted?

LAW AND ANALYSIS:

Initially, we note that the protest was timely filed (i.e., within 90 days of the date of liquidation) and the matter is protestable under 19 U.S.C. ?1514(a)(2) and (5). We note that the CF 19 states that protestant was filing its protest under 19 U.S.C. ?1520(c)(1). The entry was liquidated on July 7, 1997. The subject protest was filed on August 26, 1997. Thus, since the protest was filed within 90 days from the date of liquidation, the protest was properly treated as a timely protest under 19 U.S.C. ?1514, rather than a request for reliquidation under 19 U.S.C. ?1520(c)(1).

In the instant case, protestant asserts that the CF 7501 package clearly reflects release under an ID permit and not an entry permit. Contrary to protestant's assertion, a review of the CF 7501 failed to indicate where such information is clearly reflected. There is no attachment to the CF 7501 stating that the entry was filed as an immediate delivery CF 7501 summary. Nor, is there anything on the face of the CF 7501 to show that protestant was seeking an immediate delivery rather than filing a regular consumption entry. Box #4 "Entry Date" was left blank. Likewise, on the CF 3461 Box #2 "Elected Entry Date" was also left blank. Thus, there was no way for Customs to tell that what protestant intended to file was something other than a consumption entry. As stated above, the marking on the CF 3461 (i.e., crossing out "Entry") and electing a 1997 entry/entry summary date on the CF 7501 is the only way Customs can tell that the importer is seeking an immediate release.

We are, however, persuaded by protestant's assertion that since the ACS system accepted its entry with a 1997 duty rate, it had to have correctly requested release under the ID procedure. As stated above, the hard copy of the electronic CF 3461 shows an arrival date of December 25, 1996. However, the "elected entry date" box is blank. This office contacted ACS personnel and confirmed that since ACS intially accepted the entry with the 1997 rate of duty, protestant had to have correctly requested release under the ID procedures. We were informed by ACS personnel that protestant would have to have given a 1997 estimated entry date in order for ACS to have accepted electronic payment of the lower rate of duty.

We conclude that even though the hard copies of the CF 3461 and 7501 do not, on their face, indicate protestant's intent to seek an immediate release of the merchandise, the electronic "record" supports protestant's contention. Thus, the subject protest should be granted.

HOLDING:

The subject protest should be GRANTED.

Please note that because the file indicates that the protestant requested accelerated disposition of this protest on July 6, 1998, unless this decision is sent to the protestant on or before August 5, 1998, there will be a deemed denial of this protest by operation of law.

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, with the Customs Form 19, 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 A. Durant, Director
Commercial Rulings Division

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