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HQ 230053




January 26, 2006

LIQ-4-01; LIQ-11 RR:CR:DR 230053 LLB

Category: LIQUIDATION

Port Director
Customs and Border Protection
World Trade Bridge
715 Bob Bullock Loop
Laredo, TX 78045
Attn: Mr. Tano Macias

RE: Protest/AFR number 2304-03-100089; Hylsa, S.A. de C.V.; 19 U.S.C. §§ 1504(d) & 1514; International Trading Co v. United States, 281 F.3d 1268 (Fed. Cir. 2002); International Trading v. United States, 306 F. Supp. 2d 1265 (Ct. Int’l Trade 2004) aff’d 412 F. 3d 1303 (Fed. Cir. 2005).

Dear Mr. Macias:

The above-referenced protest was forwarded to this office for further review. We have considered the points made by the protestant Hylsa, S.A. de C.V. (Hylsa), and your office. Our decision follows.

Initially, we note that the criteria for further review have been met. The protestant asserts in its application for further review (AFR), inter alia, that pursuant to 19 C.F.R. § 174.25(b), its protest involves questions of law or fact that have not been ruled on by the Commissioner of Customs or by the Customs courts. Insofar as at the time the protestant filed its protest and AFR, an appeal was pending in the Court of Appeals for the Federal Circuit on the applicability of the 1994 amendment to § 1504(d) for entries that were subject to administrative review on or after January 1, 1995, as explained below, the criteria for further review, on the issue of deemed liquidation have been met.

FACTS

The subject protest covers 106 entries of “line pipe” made between December 17, 1992 and March 4, 1993.

Our discussion encompasses 10 representative entries made between December 17, 1992 and March 4, 1993. According to the entries, Hylsa, S.A. imported the line pipe and the packing invoices submitted therewith show the line pipe was A.P.I. 5L, galvanized, non-alloy line pipe manufactured by Hylsa, S.A. de C.V. of Mexico. The entries indicate that the line pipe was entered under subheading 7306.10.10.100, of the Harmonized Tariff Schedule of the United States (HTSUS)(1992 and 1993) at 1.9% per kilogram, ad valorem.

At the time the subject entries were filed, circular welded non-alloy steel pipe from Mexico classified, inter alia, in subheading 7306.30.50.32, HTSUS, was the subject of an antidumping order, and cash deposit instructions issued by The Department of Commerce (Commerce) directed Customs and Border Protection (CBP) to collect cash deposits in the amount of 32.62% for merchandise imported under the foregoing subheading and exported by the protestant. See Notice of Antidumping Orders: Certain Circular Welded Non-Alloy Steel Pipe from [et. al] Mexico and Amendment to Final Determination of Sales at Less Than Fair Value: Certain Circular Non-Alloy Steel Pipe from Korea, 57 Fed. Reg. 49453 (November 2, 1992); see also, Message 3321114 (November 16, 1992). According to the entries, no antidumping duties were asserted We note there are handwritten notations on the entries that indicate the antidumping case number and rate; however, this office has confirmed that these notations were made my the Port of Laredo at the time of liquidation. and no cash deposits were collected from the protestant. According to the Automated Commercial System (ACS), the merchandise was released between December 27, 1992 and March 4, 1993.

On January 18, 1994, liquidation of the entries continued to be suspended as Commerce initiated an administrative review of certain circular welded non-alloy pipe from Mexico, entered pertinently, between April 28, 1992 through October 31, 1993. See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 59 Fed. Reg. 2593 (Jan.18, 1994). In addition, at that time, Commerce was responding to a scope inquiry regarding the subject line pipe. See Final Negative Determination of Scope Inquiry on Certain Circular Welded Non-Alloy Steel Pipe and Tube From Mexico [et al.], 61 Fed. Reg. 11608 (March 21, 1996).

On February 8, 2000, Commerce published its final results of the administrative review. See Certain Circular Welded Non-Alloy Steel Pipe From Mexico; Final Results of Administrative Review, 65 Fed. Reg. 6136 (Feb. 8, 2000). On December 30, 2002, CBP received instructions from Commerce indicating that the weighted average margin for Hylsa shipments was 32.62%. At that time, the port re-classified the merchandise under subheading 7306.30.50.32, HTSUS, and liquidated the entries, according to the foregoing instructions, between January 24, and February 14, 2003. A timely protest was filed thereto, Pursuant to 19 U.S.C. § 1514(c)(3)(A), a protest must be filed has ninety days after notice of liquidation or reliquidation. The entries were liquidated between January 24, and February 14, 2003; therefore, the protestant’s April 23, 2003, protest is timely. Section 1514(c)(3) was recently amended by Miscellaneous Trade and Technical Corrections Act of 2004, Pub. L. 108-429, 118 Stat. 2434 (Dec. 4, 2004) and allows protests to be filed 180 days from the notice of liquidation or reliquidation. Since the subject merchandise was entered between December 17, 1992 and March 4, 1993, prior to the date of enactment of the foregoing Act, the amendment does not apply to this case. See Miscellaneous Trade and Technical Corrections Act of 2004 (“The amendments made by this subtitle shall apply to merchandise entered, or withdrawn from warehouse consumption, on or after the 15th day after the date of the enactment of this act.”). in which the protestant argued that 1) the entries liquidated by operation of law; 2) CBP’s unreasonably long delay in liquidating the entries constituted an abuse of discretion; 3) because the entries liquidated by operation of law assessment of interest was improper; 4) the reclassification of the merchandise was improper; and 5) a uniform and established practice existed with regard to the subject merchandise.

ISSUE

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

LAW and ANALYSIS

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 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.

The protestant argues that pursuant to Int’l Trading Co. v. United States, 281 F.3d 1268, 1277 (Fed. Cir. 2002)(hereinafter “Int’l Trading I”), the entries liquidated by operation of law 6 months after Commerce published the results of its final administrative review in the Federal Register. At the time the protestant filed its protest and AFR, there was pending litigation regarding whether CBP was exempt from the deemed liquidation mandate of section 1504(d) based on the first clause of the statute. See International Trading v. United States, 306 F. Supp. 2d 1265 (Ct. Int’l Trade 2004) aff’d 412 F. 3d 1303 (Fed. Cir. 2005).

In Int’l Trading I, Commerce published the final results of an administrative review in the Federal Register on February 12, 1996. 281 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 the requirement under § 1504(d) that CBP 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. The holding in Int’l Trading I was upheld in subsequent court cases involving the plaintiff, International Trading, for different entries. See International Trading v. United States, infra, 306 F. Supp. 2d 1265 and 412 F. 3d 1303.

In the present case, Commerce published its final results of the administrative review, on February 8, 2000, see 65 Fed. Reg. 6136; therefore, the entries deemed liquidated on August 8, 2000 at the rate of duty, value, quantity, and amount of duty asserted at the time of entry by the importer of record. Insofar as the entries liquidated by operation of law, the remaining issues are moot and therefore, are not addressed in this decision.

HOLDING

The entries liquidated by operation of law pursuant to 19 U.S.C. § 1504(d) at the rate of duty, value, quantity, and amount of duty asserted at the time of entry by the importer of record. The protest should be ALLOWED.

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 B. Harmon, Director

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