HQ 229766 - Request for Further Review of Protest No. 2704-01-100261; NMB Technologies Corp.; International Trading Co. v. United States; § 1504(d) - United States International Trade Commision Rulings

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HQ 229766

April 2, 2003

229766 MK
LIQ-11; LIQ-4- 01-RR:CR:DR

CATEGORY: LIQUIDATION

Port Director of Customs
Los Angeles-Long Beach Seaport
11099 S. La Cienega Blvd.
Los Angeles, CA 90045

RE: Request for Further Review of Protest No. 2704-01-100261; NMB Technologies Corp.; International Trading Co. v. United States; § 1504(d)

Dear Port Director:

This is in response to protest number 2704-01-100261, on behalf of NMB Technologies Corporation, filed on January 22, 2001, concerning liquidation and antidumping duties. Our decision follows:

FACTS:

The subject protest covers eighty-six entries of antifriction bearings (other than tapered roller bearings) and parts thereof from Singapore. The entries were made between May 1, 1996 and April 30, 1997. According to the entry documents, the merchandise was imported by Nippon Miniature Bearing Corp.

Customs Form 19, the liquidation instructions, and all other forms submitted refer to NMB Technologies Corporation. At the time of entry, antifriction bearings (other than tapered roller bearings) and parts thereof from Singapore were subject to an antidumping order issued by the Department of Commerce (Commerce). See Antidumping Duty Order of Sales at Less Than Fair Value: Ball Bearings and Parts Thereof From Singapore, 54 Fed. Reg. 20907 (May 15, 1989).

Commerce suspended liquidation of the entries on November 9, 1988. See Preliminary Determination of Sales of Less Than Fair Value: Ball Bearings and Parts Thereof From Singapore, 53 Fed. Reg. 45339.

Commerce reviewed the antidumping duty order on antifriction bearings (other than tapered roller bearings) and parts thereof from Singapore for a period from May 1, 1992 through April 30, 1993 and determined a weighed-average dumping margin for NMB/Pelmac from Singapore of 4.84%. See Commerce’s Notice of Preliminary Results of Antidumping Duty Administrative Reviews, Partial Termination of Administrative Reviews, and Notice of Intent to Revoke Order, 59 Fed. Reg. 9463 (February 28, 1994). The notice stated “the following deposit requirements will be effective for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of these administrative reviews.” These subsequent entries were therefore charged the 4.84% dumping margin. According to the entry documents submitted, the cash deposits on the entries were made.

Commerce initiated a review of entries of antifriction bearings (other than tapered roller bearings) and parts thereof from Singapore for the relevant period of May 1, 1996 through April 30, 1997. On June 18, 1998, Commerce published final results of the administrative review for the subject period, indicating that the weighted average margin for the antifriction bearings was 5.33%. See Antifriction Bearings (Other Than Tapered Roller Bearings) and Parts Thereof From France, Germany, Italy, Japan, Romania, Singapore, Sweden, and the United Kingdom; Final Results of Antidumping Duty Administrative Reviews, 63 Fed. Reg. 33320 (June 18, 1998).

On September 27, 2000, Commerce issued Customs instructions to liquidate the entries of antifriction bearings (other than tapered roller bearings) and parts thereof for imports by NMB from Singapore at a dumping margin of 5.93%. The Customs case number for antifriction bearings and parts thereof is A-559-201, and therefore the liquidation instructions in Message 0271206 from Commerce to Customs refers to the Customs case number. The Federal Register Notices and Orders refer to the Commerce case number for the same entries: A-559-801. Accordingly, Customs liquidated the subject entries on October 27, 2000 and November 3, 2000.

A protest was filed thereto on January 22, 2001, in which the protestant argued that the entries deemed liquidated. We note that the protest was timely filed insofar as it was filed within 90 days of both the October 27, 2000 and the November 3, 2000, liquidation dates. See 19 U.S.C. § 1514(c)(3)(A).

ISSUE:

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

LAW and ANALYSIS:

The protestant argues that the subject entries were 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 entries were subject to an administrative review, the liquidation provisions set forth in § 1675(a)(3)(B) apply to the entries. 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). § 1504(d) does not apply to the subject entries, and the entries were not deemed liquidated. Moreover, because Customs liquidated the entries on October 27, 2000 and November 3, 2000, which was less than 90 days after Commerce issued liquidation instructions on September 27, 2000, 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 entries were subject to administrative review, pursuant to the 1994 amendment of § 1504, § 1675(a)(3)(B) dictates how the entries are liquidated. Therefore, the entries did not deem liquidate. Insofar as the entries were liquidated on October 27, 2000 and November 3, 2000, within 90 days after Commerce issued the liquidation instructions to Customs on September 27, 2000, Customs satisfied the requirements of § 1675(a)(3)(B).

HOLDING:

The entries did not deem liquidate, insofar as the subject entries were 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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