HQ 228929 - Application for Further Review of Protest No. 5301-00-100084 - United States International Trade Commision Rulings

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HQ 228929

September 27, 2002

PRO 2-01 RR:CR:DR 228929 EAB

CATEGORY: PROTEST

Port Director
US Customs Service
2350 N. Sam Houston Parkway E.
Suite 1000
Houston, Texas 77032

RE: Application for Further Review of Protest No. 5301-00-100084

Dear Port Director:

This our decision on protest 5301-00-100084 filed by Grunfeld, Desiderio, Lebowitz & Silverman LLP on behalf of FAG Bearings against your decision to deny the protest due to untimliness.

FACTS:

Entries 331-NNNN414-9 (May 9, 1990), 331-NNNN497-4 (June 8, 1990), 131-NNNN171-5 (November 14, 1990), 131-NNNN293-3 (January 19, 1991) and 131-NNNN605-8 (March 25, 1991) covered certain merchandise that was subject to anti-dumping duties. Liquidation of the entries had been suspended by court orders. On February 23, 1998 Commerce published (63 FR 8908) a "Notice of final court decision and amended final results of administrative review". Therein Commerce stated, "For companies covered by these amended results, the Department will issue appraisement instructions to the U.S. Customs Service after publication of these amended final results of reviews." On October 23, 1998, Customs received instructions to refund anti-dumping duties for entries made from May 1, 1990 through April 30, 1991.

Customs failed to liquidate the subject entries before April 23, 1999. On March 10, 2000, bulletin notice of liquidation was posted and Customs ACS system was updated to indicate that the subject entries were deemed liquidated.

Protestant requested the refund of anti-dumping duties, but was denied. This protest was filed April 3, 2000 and was denied as being untimely filed more than 90 days after April 23, 1999.

ISSUES:

1. When must a protest be filed against a deemed liquidation in order to be timely filed?

2. If a protest against a deemed liquidation is timely filed, at what rate of duty are the entries to be liquidated?

LAW AND ANALYSIS:

Pursuant to 19 U.S.C. § 1514(c)(1) a protest may be filed against a decision on the liquidation of an entry (19 U.S.C. § 1514(a)(5)). Agency regulations pertaining to liquidation of duties are found in the Customs Regulations Part 159, 19 C.F.R. Part 159.

In order to protest a decision, one must have knowledge of the decision; hence, the regulations provide for the giving of notice. "Notice of liquidation of formal entries shall be made on a bulletin notice of liquidation, Customs Form 4333." 19 C.F.R. § 159.9(a).

Mere notice, without consequence, is meaningless; therefore, it is further provided that, generally, "[T]he bulletin notice of liquidation shall be dated with the date it is posted or lodged in the customhouse for the information of importers. This posting or lodging shall be deemed the legal evidence of liquidation. For electronic entry summaries, the date of liquidation will be the date of posting of the bulletin notice of liquidation [emphasis supplied]." See 19 C.F.R. § 159.9(c)(1).

Falling outside the foregoing rule and subject to their own special rule are entries liquidated by operation of law. "Entries liquidated by operation of law at the expiration of the time limitations prescribed in section 504, Tariff Act of 1930, as amended (19 U.S.C. 1504), and set out in §§ 159.11 and 159.12, shall be deemed liquidated as of the date of expiration of the appropriate statutory period." 19 C.F.R. § 159.9(c)(2)(i). Additionally, "[T]he bulletin notice of liquidation shall be posted or lodged in the customhouse within a reasonable period after each liquidation by operation of law and shall be dated as of the date of expiration of the statutory period." 19 C.F.R. § 159.9(c)(2)(ii). As with the general rule, stated above, there must be a consequence:

A protest under section 514, Tariff Act of 1930, as amended (19 U.S.C. 1514), and part 174 of this chapter shall be filed within 90 days from the date the bulletin notice of liquidation of an entry by operation of law is posted or lodged in the customhouse [emphasis supplied].

19 C.F.R. 159.9(c)(2)(iii).

The protest at hand was filed on April 3, 2000, which was within 90 days from the date bulletin notice of liquidation of the entries by operation of law was posted on March 10, 2000.

Next the protestant requests, should we find that the protest was timely filed, then we should find that the entries should be reliquidated in accordance with the instructions sent by Commerce to Customs on October 23, 1998. We decline to do this. Protestant is asking for relief to which it is not entitled.

In Canadian Fur Trappers Corp., et al. v. United States, 12 C.I.T. 612, 691 F. Supp. 364 (CIT 1988), the court stated,

The overall purpose of § 1504 was to secure a time frame for liquidation. It was intended to ameliorate situations where importers and others with a potential liability relating to customs transactions learned years after importation that additional duties were owing on that entry, or where long delays could reduce their chances of recovering a refund for any overpayment in estimated duties. S. Rep. No. 95-778, 95th Cong., 2d Sess. 32 (1978), reprinted in 1978 U.S. Code of Cong. & Admin. News 2211, 2243.

Canadian Fur Traders, supra, 616, 367.

Nowhere in either the reported cases or in Customs published rulings has it been stated that the relief and certitude of deemed liquidation turns on who, the government or the importer, lays claim to the event. When the clock is ticking, it is ticking for both parties.

When an entry is deemed liquidated, the rule is clear. Entries not actively liquidated within the statutory time period must be liquidated at the rate of duty, value, quantity and amount of duties asserted at the time of entry. See American Permac, Inc. v. United States, 642 F.Supp. 1187 (CIT 1987), Wolff Shoe Co. v. United States, 141 F.3d 1116 (Fed. Cir. 1998), HQ 228712 (May 13, 2002) and 19 U.S.C. 1504(d), which expressly provides, in part, as follows:

. . . when a suspension required by statute or court order is removed, the Customs Service shall liquidate the entry . . . within 6 months after receiving notice of the removal from the Department of Commerce, other agency, or a court with jurisdiction over the entry. Any entry (other than an entry with respect to which liquidation has been extended under subsection (b) of this section) not liquidated by the Customs Service within 6 months after receiving such notice shall be treated as having been liquidated at the rate of duty, value, quantity, and amount of duty asserted at the time of entry by the importer of record [emphasis added].

Since Customs failed to liquidate the entries within 6 months from the October 23, 1998 date of instructions from Commerce, the entries shall be treated as having been liquidated at the rate of duty, etc. asserted on the applicable CF 7501s.

For it to be otherwise, i.e. to liquidate the entries in accordance with the Commerce instructions as requested, the instant protest would have been against the decision to refuse to liquidate in accordance with the instructions and would have to have been filed within 90 days of October 23, 1998.

HOLDING:

The protest against the deemed liquidations was timely filed; however the entries were properly liquidated at the rate of duty asserted at the time of entry by the importer of record, as set forth on the applicable CF 7501s.

The Protest should be denied.

In accordance with Section 3(A)(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed, with the Customs Form 19, 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 Ruling Module in ACS and public via the Diskette Subscription Service, Freedom of Information Act and other public access channels.

Sincerely,
William G. Rosoff, for

Myles B. Harmon,
Acting Director
Commercial Rulings Division

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