HQ 229764 - Protest/AFR No. 2704-02-101256; 19 U.S.C. §§ 1504(d) & 1675(a)(3); deemed liquidation - United States International Trade Commision Rulings

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HQ 229764

March 24, 2003

LIQ-4-01; LIQ-11
229764 LLB

Category: LIQUIDATION

Port Director of Customs
Los-Angeles-Long Beach Seaport
11099 S. La Cienega Blvd.
Los Angeles, CA 90045
Attn: Gerald E. Rankin

RE: Protest/AFR No. 2704-02-101256; 19 U.S.C. §§ 1504(d) & 1675(a)(3); deemed liquidation

Dear Mr. Rankin:

The above-referenced protest has been forwarded to this office for further review. We have considered the points raised by the protestant, Sea Safari, Ltd., and your office. Our decision follows.

FACTS

The subject protest covers an entry of freshwater crawfish tail meat made on November 19, 1998. According to the entry, the crawfish was imported by Sea Safari, Ltd., and the packing invoice submitted therewith shows the crawfish was a product of China exported by Huaiyin Foreign Trade Corporation (Huaiyin). At the time of entry, freshwater crawfish tail meat from China was subject to an antidumping order issued by the Department of Commerce (Commerce). See Notice of Amendment to Final Determination of Sales at Less Than Fair Value and Antidumping Order: Freshwater Crawfish Tail Meat From the People’s Republic of China, 62 Fed. Reg. 48218 (September 15, 1997). The order stated that the merchandise was subject to a dumping margin of 91.50% and accordingly, directed Customs to collect cash deposits on entries of crawfish tail meat filed on or after March 26, 1997. Id. According to the entry documents submitted, the cash deposits on the entries were fully paid.

In 1999, the entries were suspended as Commerce initiated a review of freshwater crawfish tail meat from China for the relevant period of September 1, 1998 through August 31, 1999. See Initiation of Antidumping and Countervailing Duty Administrative Reviews and Requests for Revocation in Part, 64 Fed. Reg. 60161 (November 4, 1999). On April 24, 2001, Commerce published final results
of the administrative review for the subject period, indicating that the weighted average margin for the crawfish tails produced by those companies not specifically listed in therein (e.g. PRC-Wide Rate), was 201.63%. Freshwater Crawfish Tail Meat from the People’s Republic of China; Notice of Final Results of Antidumping Duty Administrative Review and New Shipper Reviews, and Final Partial Rescission of Antidumping Duty Administrative Review, 66 Fed. Reg. 20634 (April 24, 2001).

Commerce amended its final results; however, the weighted average margin for the protestant did not change. See Freshwater Crawfish Tail Meat From the People’s Republic of China: Amended Final Results of Administrative Review and New Shipper Reviews, 66 Fed. Reg. 30409 (June 6, 2001).

On February 22, 2002, Commerce issued Customs instructions to liquidate the entries of crawfish tails at a dumping margin of 201.63%. Accordingly, Customs liquidated the subject entry on April 19, 2002. A protest was filed thereto on June 17, 2002, in which the protestant argued that the entry deemed liquidated. We note that the protest was timely filed insofar as it was filed within 90 days of the April 19, 2002, liquidation date. See 19 U.S.C. § 1514(c)(3)(A).

ISSUE

Whether the entry deemed liquidated by operation of law pursuant to 19 U.S.C. § 1504

LAW and ANALYSIS

The protestant argues that the subject entry was deemed liquidated pursuant to § 1504(d), at the rate and amount of duty deposited at the time of entry. Pursuant to 19 U.S.C. 1504(d),

Except as provided in section 1675(a)(3) of this title, 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 had been extended under subesection (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). As amended, § 1675(a)(1) and (3) provide, in pertinent part:

§ 1675 Administrative review of determinations (a) Periodic review of amount of duty
(1) In general
At least once during each 12 month period beginning on the anniversary date of publication of . . . an antidumping duty order under this subtitle or a finding under the Antidumping Act, 1921, or notice of the suspension of an investigation, the administering authority, if a request for such a review has been received and after publication of notice of such review in the Federal Register, shall—

(B) review, and determine (in accordance with paragraph (2), the amount of any antidumping duty, and (C) review the current status of, and compliance with, any agreement by reason of which an investigation was suspended, and review the amount of any net countervailing subsidy or dumping margin involved in the agreement, and
shall publish in the Federal Register the results of such review, together with notice of any duty to be assessed, estimated duty to be deposited, or investigation to be resumed. . . .

(3) Time limits
(B) Liquidation of entries

If the administering authority orders any liquidation of entries pursuant to a review under paragraph (1), such liquidation shall be made promptly and, to the greatest extent practicable, within 90 days after the instructions to Customs are issued. In any case in which liquidation has not occurred within the 90-day period, the Secretary of Treasury shall, upon the request of the affected party, provide an explanation thereof.

(C) Effect of pending review under section 1516a

In a case in which a final determination under paragraph (1) is under review under section 1516a of this title and a liquidation of entries covered by the determination is enjoined under section 1516a(c)(2) of this title or suspended under section 1516a(g)(5)(C) of this title, the administering authority shall within 10 days after the final disposition of the review under section 1516a of this title, transmit to the Federal Register for publication the final disposition and issue instructions to the Customs Service with respect to liquidation of entries pursuant to the review. In such a case, the 90-day period referred to in subparagraph (B) shall begin on the day on which the administering authority issues such instructions.

Sections 1504(d) and 1675(a)(3)(B) are directed to liquidation of entries and contain parallel provisions. Section 1504 is entitled “Limitation on liquidation”, and subsection (d) is entitled “Removal of suspension” which provides that “when a suspension . . . is removed, the Customs Service shall liquidate the entry . . . within 6 months after receiving notice of removal. . . .Any entry . . . not liquidated by the Customs Service within 6 months after receiving such notice shall be. . .” deemed liquidated at the deposit rate. Section 1675(a)(3)(B), entitled “Liquidation of entries”, provides that “any liquidation of entries,” subject “to review under paragraph 1,” i.e. to an administrative review, “shall be made promptly and, to the greatest extent practicable, within 90 days after instructions to Customs are issued.” If “liquidation has not occurred within that 90 day period, the Secretary of Treasury shall, upon request of the affected party, provide an explanation thereof.” § 1675(a)(3)(B).

Because the subject entry was subject to an administrative review, the liquidation provisions set forth in § 1675(a)(3)(B) apply to the entry. However, because the consequences of failing to timely liquidate under the two statutes are different, i.e. deemed liquidation under § 1504 versus explanation of the delay in liquidation under 1675(a)((B)(3), we need to determine whether § 1504(d) applies to entries that are subject to provisions of § 1675(a)(3)(B). When Congress amended § 1675(a)(3) in 1994, it also amended § 1504 to prevent these provisions from overlapping. After describing the amendment of § 1675(a)(3), the congressional reports state the purpose of the amendment to § 1504:

Section 220(c) of H.R. 5110 makes conforming changes to section 504 of the Act [19 U.S.C. § 1504], a provision which establishes general rules regarding the liquidation of customs entries.

H.R. Rep. No. 826 pt. 1, Uruguay Round Agreements Act, 103rd Cong., 2d Sess. (1994).

Section 220(c) of the implementing bill makes conforming changes to section 504 of the 1930 Tariff Act [19 U.S.C. § 1504], which establishes the general rules governing the liquidation of entries.

S. Rep. No. 103-412, pt. 1, Uruguay Round Agreements Act, 103rd Cong., 2d Sess. (1994). Both congressional reports thus described § 1504 as establishing general rules governing the liquidation of entries, and the amendment as conforming § 1504 to § 1675(a)(3).

The 1994 amendment added the language, “except as provided in section 1675(a)(3) . . .,” to the first sentence of § 1504(d). “Except” is defined in lexicons as follows:
except . . .vt 1: to take or leave out (something) from a number or a whole: exclude or omit (as from consideration) . . .
except . . .prep. . . .1: with the exclusion or exception of , : save . . .

Webster’s Third New International Dictionary, 791(1981).
except . . . v.t. To leave or take out: exclude; omit.-v.t. To object; take exception: with to. –prep. With the exception of ; excluding; leaving out; save; but: Tell no one except me. . . .

Funk & Wagnalls New International Dictionary, 442 (1987).

The plain meaning of the 1994 amendatory language, therefore, is that it excepts, excludes, omits, takes out or leaves out an entry from coverage under 1504(d) when the entry is subject to the provisions of § 1675(a)(3), such as the subject entry. Thus, the amendatory language creates an exception from coverage under § 1504(d) for entries that are administratively reviewed and subject to the liquidation provisions of § 1675(a)(3). Consequently, § 1504(d) does not apply to the subject entry, and the entry was not deemed liquidated. Moreover, because Customs liquidated the entry on April 19, 2002, which was less than 90 days after Commerce issued liquidation instructions on February 22, 2002, Customs satisfied the requirements of § 1675(a)(3)(B).

However, the protestant argues that pursuant to International Trading Co. v. United States, 581 F.3d 1268, 1271 (Fed. Cir. 2002), the entries deemed liquidated because they were not liquidated within 6 months after publication of the final results in the Federal Register. In International Trading, Commerce published the final results of an administrative review in the Federal Register on February 12, 1996. 581 F.3d at 1270. On August 29, 1996, more than six months after publication of the final results, Commerce sent liquidation instructions by e-mail to Customs in which it stated that suspension of liquidation was lifted, and directed the assessment of antidumping duties. Id. The court held “that suspension of liquidation was removed on February 12, 1996, when the results of the administrative review were published in the Federal Register.” Id. at 1277. As to § 1504(d)’s requirement that Customs receive notice of removal of suspension of liquidation before an entry can be deemed liquidated, the court further held that:
publication of the final results in the Federal Register constituted notice from Commerce to Customs that the suspension of liquidation on the subject entries had been removed. Customs did not liquidate the entries within six months of February 12, 1996, as required by 1504(d). The entries were therefore properly treated as having been liquidated six months after February 12, 1996, at the 2.72% antidumping duty asserted at the time of entry by ITC.

Id.

Nevertheless, International Trading is not applicable to the present case because the court in that case was applying the pre-1994 version of § 1504(d) and the present case involves the effect of the 1994 amendment on § 1504. See 281 F.3d at 1271 n.1 (stating that “[1504] has subsequently been amended, but not in ways material to the issue in this case” and “[o]ther portions of the antidumping law have also been amended. In this opinion, we refer to the pre-1994 versions of the pertinent sections of the Tariff Act, which govern this case.”).

In conclusion, since the subject entry was subject to administrative review, pursuant to the 1994 amendment of § 1504, § 1675(a)(3)(B) dictates how the entry is liquidated. Therefore, the entry did not deem liquidate. Insofar as the entry was liquidated on April 19, 2002, within 90 days after Commerce issued the liquidation instructions to Customs on February 22, 2002, Customs satisfied the requirements of § 1675(a)(3)(B).

HOLDING

The entries did not deem liquidate, insofar as the subject entry was subject to an administrative review, and liquidation according to 19 U.S.C. § 1675(a)(3)(B) was made within 90 days after the Department of Commerce issued liquidation instructions to Customs.

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 Harmon, Director

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