HQ 229397 - Protest No. 4503-01-100040; Antidumping Duties; 19 U.S.C. 1514; 19 U.S.C. 1504(d) - United States International Trade Commision Rulings

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HQ 229397

September 27, 2002

RR:CR:DR 229397 IDL

CATEGORY: PROTEST

U.S. Customs Service
Att: Jim Roberts
4477 Woodson Road
Room 200
St. Louis, MO 63134

RE: Protest No. 4503-01-100040; Antidumping Duties; 19 U.S.C. 1514; 19 U.S.C. 1504(d)

Dear Mr. Roberts:

This is in response to your correspondence concerning GBS Industries, Inc., of Old Bridge, New Jersey, Protest No. 4503-01-100040.

FACTS:

Protestant, GBS Industries, Inc. (“GBS”), imported Brake Drum Rotors from China, exported by Longkou Haimeng Machinery Co., Ltd. (“Haimeng”). On January 27, 1999, Entry No. 605-xxxx468-2 (“Entry 468-2”) was made at the port of St. Louis, MO. On February 23, 1999, Entry No. 605-xxxx628-1 (“Entry 628-1”) was made at the same port. Upon entry, the port suspended liquidation and required of Haimeng a deposit of estimated antidumping duty at the rate of 43.32%. On July 20, 2001, after Commerce lifted suspension of liquidation, the port liquidated the subject entries. On October 12, 2001, GBS filed protest against the liquidations at the antidumping duty rate of 43.32%.

On April 17, 1997, the Department of Commerce (“Commerce”) had published in the Federal Register (62 FR 18740) on Case A-570-846, Notice of Antidumping Duty Order: Brake Rotors from the People’s Republic of China (“Order”). That Order established an “all others” rate of 43.32% for companies such as Haimeng, which did not have a separate rate.

On December 4, 1997, the Department of Commerce (“Commerce”) had published in the Federal Register (62 FR 64206) on Case A-570-846, Brake Rotors From the People’s Republic of China: Initiation of New Shipper Antidumping Duty Administrative Reviews.

On February 4, 1998, Commerce issued to Customs Deposit Instructions For New Shipper Review of Brake Rotors From the People’s Republic of China (“Deposit Instructions”), on Case A-570-846, via Message No. 8035111, which covered brake rotors from China exported by Haimeng:

For shipments of Brake Rotors from the People’s Republic of China entered, or withdrawn from warehouse, for consumption in the U.S. on or after December 4, 1997, a bond or other security deposit is permitted, at the importer’s option, for the following new manufacturers/exporters:

[Haimeng]..A-570-846-026..43.32%

The option of a bond in lieu of a cash deposit will remain in effect for [Haimeng] until publication of the Final Results of the New Shipper Administrative Review.

On September 29, 1998, Commerce had published in the Federal Register (63 FR 51895) on Case A-570-846, Brake Rotors From the People’s Republic of China: Preliminary Results of Antidumping Duty New Shipper Administrative Review (“Preliminary Results”).

On January 27, 1999 and February 23, 1999, Haimeng entered the subject merchandise. GBS deposited 0.00% cash deposit pursuant to the Preliminary Results. The CF 7501’s for each entry listed Case A-570-846-023 in column 30 and referenced the rate of 43.32% in column 34. However, the sums represented were not deposited.

On March 1, 1999, Commerce published in the Federal Register (64 FR 9972), on Case A-570-846, Brake Rotors From the People’s Republic of China: Final Results of Antidumping Duty New Shipper Administrative Review (“New Review”). The New Review indicated the following:

[T]he following deposit rates shall be required for merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of these final results of administrative review (1) The cash deposit rates for Haimeng will be the rates indicated above [0.00%]

On October 30, 2000, Commerce published in the Federal Register (65 FR 64664), on Case A-570-846, Brake Rotors From the People's Republic of China: Final Results of Third New Shipper Review and Final Results and Partial Rescission of Second Antidumping Duty Administrative Review (“Final Results and Partial Rescission”), covering the period April 1, 1998 through March 31, 1999. The Final Results and Partial Rescission determined that Haimeng was subject to 0.10% (de minimis) antidumping duty for the period April 1, 1998 through March 31, 1999. Further, the Final Results and Partial Rescission indicated that Commerce “will instruct the Customs Service to liquidate without regard to antidumping duties all entries of subject merchandisefor which the import-specific assessment rate is zero or de minimis”

On December 15, 2000, Commerce issued to Customs liquidation instructions for Case A-570-846, Message No. 0350201, which covered Brake Rotors from China produced or exported specifically by Haimeng (Case A-570-846-023).

On December 19, 2000, Commerce issued to Customs liquidation instructions for Case A-570-846, Message No. 0354203, which covered Brake Rotors From China entered or withdrawn from warehouse for consumption during the period April 1, 1998 through March 31, 1999.

On June 7, 2001, the port issued a Notice of Action on Entries No. 468-2 and 628-1, explaining that, per Message No. 0354203, dated December 19, 2000, antidumping liabilities are to be assessed at 43.32% percent of the entered value. On July 20, 2001, the port liquidated Entries 380-9 and 629-9 at the antidumping duty rate of 43.32%. On October 12, 2001, GBS filed Protest No. 4503-01-100040, arguing that it is liable for 0.00% antidumping duties.

ISSUES:

Whether Customs correctly assessed antidumping duties?

(2) Whether the liquidation by Customs of the subject entries on July 20, 2001 was barred by a prior liquidation by operation of law under 19 U.S.C. 1504(d)?

(3) Whether the entries are now subject to 0.00% antidumping duties?

LAW AND ANALYSIS:

Initially, we note that the protest was timely filed under the statutory and regulatory provisions for protests (see 19 U.S.C. § 1514 and 19 CFR Part 174). The entries were liquidated on July 20, 2001, and the subject protest was filed on October 12, 2001.

Further, we note that the issue in the instant case is protestable under 19 U.S.C. 1514, because Customs implementation of Commerce’s instructions for assessing antidumping duties is protested, not the antidumping determination itself. In order to protest a decision under 1514, that decision must be made by Customs. See 1514(a); see also Xerox Corp. v. United States, 289 F.3d 792 (Fed. Cir. 2002), reversing Xerox, 118 F.Supp. 2d 1353, Ct. Int’l Trade (October 19, 2000); Nichimen America, Inc. v. United States, 938 F.2d 1286 (1991 Fed. Cir.); HQ 224650 (November 25, 1994).

In contrast, the Court of International Trade held that a protestant may not challenge facts relating to determinations by Commerce in a 1514 protest action. See ABC International Traders v. United States, CIT Slip. Op. 95-97 (May 23, 1995); HQ 224623. Generally, we have held that the role of Customs in the antidumping process is "... simply to follow Commerce's instructions in collecting deposits of estimated duties and in assessing antidumping duties, together with interest, at the time of liquidation". HQ 225382 (July 3, 1995); HQ 226263 (December 10, 1996).

Issue (1)
Whether Customs correctly assessed antidumping duties?

In the instant case, the port relies on Message No. 0354203, dated December 19, 2000, in its determination that Haimeng is liable for 43.32% antidumping duties. The liquidation instructions contained in that message state the following:

For all shipments of Brake Rotors from the People’s Republic of China (PRC) made by companies not mentioned in Message Number0350201, imported by any importer, entered or withdrawn from warehouse for consumption during the period 04/01/1998 through 03/31/1999, assess an antidumping liability of 43.32% of the entered value.

However, although Message No. 0350201 (A-570-846-023) specifically mentions Haimeng, it does not specifically mention GBS as importer. Therefore, it is not clear which of the messages (0350201 or 0354203) applies here.

In any event, on February 4, 1998, prior to the time of the entries on January 27 and February 23, 1999, the cash deposit rate in effect was 43.32%, pursuant to the Order published on April 17, 1997 (62 FR 18740) and the Deposit Instructions (Message No 8035111). That rate became effective for entries dated on or after December 4, 1997.

On March 1, 1999, the date of publication of the New Review, Commerce required of Haimeng a new cash deposit rate of 0.00% for entries made on or after March 1, 1999. However, since the subject entries were entered prior to March 1, 1999, the new cash deposit rate of 0.00% did not apply to the subject entries. Thus, the deposit rate in effect at the time of entry was 43.32%, pursuant to the Deposit Instructions of February 4, 1998. Further, the importer listed both the dumping case number and the deposit rate of 43.32% on the entry (CF 7501).

Therefore, Customs correctly assessed antidumping duties.

Issue (2)
Whether liquidation by Customs of the subject entries on July 20, 2001 was barred by a prior liquidation by operation of law under 19 U.S.C. 1504(d)?

Notwithstanding our holding in Issue (1), above, the Court of International Trade, interpreting 19 U.S.C 1504(d) in International Trading Co. v. United States, 110 F.Supp. 2d 977; Slip Op. 00-83 (July 14, 2000); Slip Op. 00-1577 (Fed. Cir.) March 1, 2002, aff’d, held that suspension on liquidation for the subject entries was removed following the publication of notice of final results in the Federal Register, and was sufficient notice under section 1504(d) (1993) for the 6-month liquidation period to run.

(d) Removal of suspension
[W]hen a suspension required by statute or court order is removed, the Customs Service shall liquidate the entrywithin 6 months after receiving notice of the removal from the Department of Commerce. Any entrynot 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 or record. 19 U.S.C. 1504(d).

In this case, the subject entries were made on January 27 and February 23, 1999. On October 30, 2000, Commerce published the Final Results and Partial Rescission. Commerce listed Haimeng as liable for 0.10% (de minimis) antidumping duty liability for entries occurring during the period of April 1, 1998 through March 31, 1999.

However, under the court’s interpretation of 19 U.S.C. 1504(d) in International Trading, Customs was required to liquidate the subject entries 6 months after Commerce published the Final Results and Partial Rescission (i.e., not later than April 30, 2001). Customs failed to liquidate the subject entries until July 20, 2001.

Therefore, Entries 468-2 and 628-1 liquidated by operation of law on April 30, 2001, pursuant to 19 U.S.C. 1504(d), at the amount of duty asserted at the time of entry by the importer of record.

Issue (3)
Whether the entries are now subject to 0.00% antidumping duties?

Examination of the CF 7501 Entry Summary shows that GBS included the antidumping duty investigation code, Case A-570-846-023, and asserted antidumping duties at the rate of 43.32%.

Therefore, pursuant to 19 U.S.C. 1504(d), above, the entries are not subject to 0.00% antidumping duties, and GBS is liable for antidumping duties at the rate of 43.32%. See Rheem Metalurgica S/A, et al. v. United States, 160 F.3d 1357 (Fed. Cir. 1998).

HOLDING:

Accordingly, the protest should be DENIED for the reasons noted above. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, you are to mail this decision, together with the Customs Form 19, to the Protestant no later than 60 days from the date of this letter. Any reliquidation of the entry or entries in accordance with the decision must be accomplished prior to mailing the decision.

Sixty days from the date of the decision, the Office of Regulations and Rulings will make the decision available to Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.ustreas.gov, by means of the Freedom of Information Act, and other methods of public distribution.

Sincerely,

Myles B. Harmon, Acting Director
Commercial Rulings Division

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