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HQ 230144





March 9, 2005

LIQ-4-01; LIQ-11 RR:CR:DR
230144RDC

CATEGORY: PROTEST

Port Director, Customs and Border Protection Los Angeles – Long Beach Seaport
301 E. Ocean Blvd.
Suite 1400
Long Beach, CA 90802

RE: Protest number 2704-03-101208; 19 U.S.C. § 1504(d); 19 U.S.C. § 1514; antidumping duty; removal of suspension of liquidation; suspension of liquidation; deemed liquidation; liquidation by operation of law; notice to CBP; 19 C.F.R. § 159.1; Fujitsu Gen. America, Inc. v. United States (110 F. Supp. 2d 1061 (Ct. Int’l Trade 2000); (aff’d 283 F.3d 1364 (Fed. Cir. 2002); Peer Chain Co. v. United States, (316 F. Supp. 2d 1357 (Ct. Intl. Trade 2004); liquidation instructions.

Dear Port Director:

On September 19, 2003, the above-referenced Protest was forwarded to this office for further review. We have considered the points raised by your office and the Protestant. Our decision follows.

FACTS:

The Protestant, Kompass Food Trading International (Kompass), protests the liquidation of 24 entries that were assessed increased antidumping duty (AD) at liquidation. According to the Protestant and the CF 7501 for one representative entry, number 605-xxxx206-0, the goods entered were subject to AD case A-549-813-000, canned pineapple from Thailand. (See Final Determination of Sales at Less Than Fair Value: Canned Pineapple Fruit from Thailand, 60 Fed. Reg. 29,553 (June 5, 1995)). On the CF 7501, AD of 24.64 percent is asserted to be the applicable rate and the Protestant states that it made a “cash deposit for the estimated dumping duties at a rate of 24.64 percent” at entry. According to CBP’s automated data collection system (ACS), the protested entries were entered between 7/12/1996 and 6/30/1997. We note that the Protestant lists the incorrect entry dates for many of the entries and the actual dates of entry are several days after those stated by Kompass. Kompass states “in each instance, the merchandise was exported from Thailand by Vita Food Factory (1989) Ltd.” (Vita). An invoice dated 9/16/1996, shows Vita as also the manufacturer of the canned pineapple.

On 8/28/1997 an administrative review of the AD order was initiated for case number A-549-813 for the period 7/1/1996 to 6/30/1997 (Notice of Initiation of Antidumping Duty Administrative Review (62 Fed. Reg. 45,621, 8/28/1997)). Among those exporters or producers named as subject to the administrative review was Vita. On 8/14/1998 the final results of this administrative review were published (63 Fed. Reg. 43,661). That notice advised that, for canned pineapple from Thailand manufactured or exported by Vita and entered between 7/1/1996 and 6/30/1997 the applicable AD rate was 51.16 percent. Kompass, among others, challenged these final results in the Court of International Trade (CIT). An order enjoining liquidation of the protested entries (and others) was issued on 10/22/1998.

On 7/31/2000 the CIT issued its decision affirming the results of the Administrative Review (Kompass Food Trading International v. United States, 24 CIT 678 (Ct. Intl. Trade 2000)) (Kompass Food). According to Kompass, no appeal was taken from this decision. On 1/17/2003 Message number 3017208 containing liquidation instructions from the Department of Commerce, International Trade Administration (DOC) was issued. These instructions directed CBP to liquidate entries of canned pineapple from Thailand entered between 7/01/1996 and 06/30/1997 with AD at 24.46 percent. Message number 302302, issued 1/23/2003, from the DOC corrected the liquidation instructions contained in Message number 3017208 and directed AD of “51.16 percent of the entered value” to be assessed.

According to the liquidation / reliquidation worksheet prepared by the port, AD of 51.16 percent was imposed on Kompass’ protested entries at liquidation on 2/21/2003. Interest was also assessed on each entry on the difference between the 24.64 percent AD deposited at entry and the 51.16 percent imposed at liquidation. The instant Protest was received on 5/19/2003. Kompass contends that the entries were deemed liquidated as entered per 19 U.S.C. § 1504(d) and challenges the imposition of the interest on the additional antidumping duties assessed at liquidation.

ISSUES:

1. Did CBP liquidate the protested entries more than 6 months after receiving notice per § 1504(d) that the injunction enjoining liquidation was dissolved?

2. If not, is interest applicable to the additional antidumping duties assessed at liquidation?

LAW AND ANALYSIS:

We note initially that the instant Protest was timely filed, i.e., within 90 days of the liquidation of the entries (19 U.S.C. § 1514(c)(3)(B)). Under 19 U.S.C. § 1514(a) “decisions of the Customs Service, including the legality of all orders and findings entering into the same, as to . . . the liquidation or reliquidation of an entry . . . are final unless a protest of that decision is filed within 90 days of the notice of liquidation (19 U.S.C. §1514(c)(3)(B)). The protested entries were liquidated 2/21/2003 and this Protest was received 5/19/2003.

Generally, AD rates correctly applied by CBP are not protestable, (see Fujitsu Ten Corp. v. United States, 957 F. Supp. 245 (Ct. Intl. Trade 1997)) because “Customs has a merely ministerial role in liquidating antidumping duties” (Mitsubishi Electronics America, Inc. v. United States, 44 F.3d 973, 977 (Fed. Cir. 1994)). CBP “may not independently modify, directly or indirectly the determinations, [the Department of Commerce’s] underlying facts, or their enforcement” (Royal Business Machines Inc. v. United States, 507 F. Supp. 1007, 1014 n.18 (Ct. Int'l Trade 1980), aff'd, 69 C.C.P.A. 61, 669 F.2d 692 (CCPA 1982)). However, per § 1514(a)(5) the matter protested, the liquidation of the subject entries, is subject to protest.

The Protestant contends that the subject entries liquidated as entered per 19 U.S.C. § 1504(d) “because of the extraordinary length of time that passed between the decision” (on 7/31/2000, in Kompass Food) in Kompass’ suit challenging the final results of the administrative review and the issuance of liquidation instructions (on 1/23/2003) . . . .” Section 1504(d) requires CBP to liquidate entries within 6 months of receiving notice that a suspension of liquidation has lifted or the entries are “deemed liquidated” as entered. Kompass argues that the injunction was lifted “at the latest” on 9/29/2000 when the time for appealing the Kompass Food decision to the CAFC expired. Kompass contends that since CIT decisions are issued publicly and notice was served on the United States as a party, CBP had notice that the injunction enjoining liquidation of the subject entries was dissolved on the date the CIT decision in Kompass Food was issued. Thus the Protestant concludes that per § 1504(d), the protested entries were deemed liquidated 6 months after that decision was issued, i.e., 1/31/2001.

In Peer Chain Co. v. United States, (316 F. Supp. 2d 1357 (Ct. Intl. Trade 2004)) (Peer Chain) the CIT relied on Fujitsu Gen. America, Inc. v. United States, (110 F. Supp. 2d 1061 (Ct. Int’l Trade 2000); (aff’d 283 F.3d 1364 (Fed. Cir. 2002)) (Fujitsu), when rejecting the argument that since CIT decisions are issued publicly and notice was served on the United States as a party, CBP had notice that the injunction enjoining liquidation of the subject entries was dissolved on the date the relevant CIT decision was issued. Kompass argues that because the decision in Kompass Food was made generally available to the public, that publication constituted notice to CBP. In Peer Chain, the manufacturer of the entered goods challenged the AD rate determined by the DOC’s administrative review. The DOC never published notice in the Federal Register of the CAFC’s decision in this action. Almost five years later the DOC sent a non-public message to CBP, directing it to liquidate the relevant entries and assess AD duty at the applicable rate. CBP liquidated the entries one month after receiving the message and billed the plaintiff for the AD duty and interest. The plaintiff in Peer Chain challenged the liquidation of these entries in the CIT by arguing that the DOC’s failure to publish notice of the CAFC decision frustrated the deemed liquidation provision of 19 U.S.C. § 1504(d). (316 F. Supp. 2d 1357). Peer Chain contended that the government should be deemed to have notice that the injunction dissolved prior to the DOC’s non-public message to CBP.

The court in Peer Chain determined that only CBP’s inaction - not the DOC’s - was remedied by deemed liquidation under § 1504(d) (316 F. Supp. 2d 1357, 1363). The Peer Chain court relied on Fujitsu when concluding that the DOC’s failure to act cannot be redressed by deemed liquidation per § 1504(d). In Fujitsu, the liquidation of the entries at issue was enjoined when the DOC's final results of an administrative review were challenged in the CIT (283 F.3d 1364). The CIT affirmed the DOC's final results as adjusted on remand and the CAFC affirmed this decision. However, the DOC delayed issuing the Federal Register notice of this decision and issuing liquidation instructions to CBP for nearly a year. CBP liquidated the subject entries after receiving the liquidation instructions. Fujitsu argued that because the DOC did not publish notice of the relevant decision in the Federal Register until more than a year after the decision had been issued, “the government should not be allowed to ‘sidestep’ the six-month limitation period in 19 U.S.C. § 1504(d) by having Commerce ignore for over a year the ten-day publication requirement in section 1516a(e).” (Fujitsu at 1382.)

The CAFC stated that there is no language in § 1516a to provide a consequence for failure to publish a decision and rejected Fujitsu’s contention. (Fujitsu at 1382). Further, the CAFC held that deemed liquidation only applies to entries that CBP fails to liquidate within 6 months after receiving notice that suspension of liquidation was lifted (283 F.3d 1364, 1382). The Fujitsu court described the application § 1504(d) (1993) by stating:

Thus, in order for a deemed liquidation to occur, (1) the suspension of liquidation that was in place must have been removed; (2) Customs must have received notice of the removal of the suspension; and (3) Customs must not liquidate the entry at issue within six months of receiving such notice.

(Fujitsu 283 F.3d 1364, 1376). In Fujitsu the CAFC agreed with the CIT’s holding that when a suit challenging the final results of administrative review is appealed to the CAFC, suspension of liquidation is removed when the “time for petitioning the Supreme Court for certiorari expire[d] without the filing of a petition.” (283 F.3d 1364, 1378).

The CIT issued its opinion in Kompass’ case challenging Commerce’s final results of administrative review on 7/31/2000. No appeal to the CAFC was filed. Consequently, per the CAFC’s reasoning in Fujitsu, the CIT’s decision in Kompass’ case was “final” when the time for filing an appeal of the CIT decision to the CAFC ended without an appeal being filed. Per CAFC Rules of Civil Procedure, there is a 60-day period for filing an appeal of a CIT decision with the CAFC (Ct. App. Fed. Cir., Cir. R. 10 (2003)). Therefore, the injunction enjoining liquidation of the subject entries was dissolved 60 days after the CIT issued its decision in Kompass Food, i.e., on 9/29/2000, when the time for petitioning the CAFC for review expired.

In Peer Chain, as in Kompass’ case, the DOC never published notice in the Federal Register of the court decision resolving a challenge to the final results of an administrative review. The Peer Chain court, citing Fujitsu (283 F.3d 1364), rejected plaintiff’s argument that CBP should have been “deemed notified” of the court decision on the date that the decision was published (316 F. Supp. 2d 1357, 1363-64). In Fujitsu, the plaintiff argued that CBP had notice that the court-ordered suspension of liquidation was removed on the date the CAFC issued its decision because that decision was available publicly and served on the United States (Fujitsu 283 F.3d 1364, 1380). In Fujitsu the CAFC noted that § 1504(d) requires that CBP receive notice from “the Department of Commerce, other agency, or a court with jurisdiction over the entry" and stated “[g]eneral print or electronic media publication does not satisfy that requirement.” (283 F.3d 1364, 1380-81). Consequently, the issuance of the CIT decision in Kompass Food cannot serve as notice to CBP that the injunction against liquidation in the instant Protest was dissolved.

We have no evidence to suggest that CBP received § 1504(d) notice that suspension of liquidation was removed with regard to the protested entries before the DOC issued the liquidation instructions. Accordingly, we hold that receipt of Message number 3017208 containing liquidation instructions on 1/17/2003 constituted § 1504(d) notice to CBP that suspension of liquidation of the protested entries was lifted. Therefore, since the entries were liquidated on 2/21/2003, well within the § 1504(d) 6 month period, the protested entries are not deemed liquidated.

Kompass also argues that “the continued accrual of interest during the two and a half years after the conclusion of the judicial appeal was improper.” The DOC liquidation instructions contained in Message number 3017208 state: “The assessment of antidumping duties by the Customs Service on entries of this merchandise is subject to the provisions of § 778 of the Tariff Act of 1930.” Section 778 of the Tariff Act, as amended, codified at 19 U.S.C. § 1677g(a), provides that

(a) General rule. Interest shall be payable on overpayments and underpayments of amounts deposited on merchandise entered, or withdrawn from warehouse, for consumption on and after-- (1) the date of publication of a countervailing or antidumping duty order under this title or section 303 [19 USCS § 1303], . . . .

Thus, § 1677g(a) requires payment of interest on the difference between deposited amounts of estimated duties and final assessed duties" (Timken Co. v. U.S., 37 F.3d 1470 (Fed. Cir. 1994)). The Peer Chain court also relied on the requirement in § 1677g(a) when it rejected that plaintiff’s argument equity considerations should prevent the imposition of excessive interest. (316 F. Supp. 2d 1357, 1366). Accordingly, in its ministerial capacity, CBP was required to assess interest on the additional antidumping duties due.

Finally, Kompass states, “short of the complex and costly process of filing for a writ of mandamus, there was nothing that Kompass could do to pay the Customs bills and stop the continuing accrual of interest until liquidation occurred.” On the contrary, we direct the Protestant’s attention to HRL 221875 issued 11/26/1990, which holds that an importer of record may, per 19 C.F.R. § 141.05, deposit estimated antidumping duties prior to liquidation based on the treatment of antidumping duties as regular CBP duties. Since the authorities cited in HRL 221875 have not changed materially since its issuance and are thus still in effect Kompass did in fact have an option other than filing for a writ of mandamus with which to address the accruing interest.

HOLDING:

1. CBP liquidated the protested entries within 6 months after receiving notice per § 1504(d) that the injunction enjoining liquidation was dissolved and thus, the entries were not deemed liquidated.

2. Interest per 19 U.S.C. § 1677g(a) is applicable to the additional antidumping duties assessed at liquidation.

The Protest should be DENIED in full.

In accordance with the Protest/Petition Processing Handbook (CIS HB, January 2002, pp. 18 and 21), 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 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 make the decision available to CBP personnel, and to the public on the CBP Home Page on the World Wide Web at www.cbp.gov, by means of the Freedom of Information Act, and other methods of public distribution.

Sincerely,

Myles Harmon, Director

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