H303404

90 K Street N.E., Washington, DC 20229 U.S. Customs and Border Protection HQ H303404 June 25, 2020 LIQ 4-01 H303404 SMS OT:RR:CTF:ER Center Director Industrial and Manufacturing Materials Center U.S. Customs and Border Protection 726 Exchange Street, Suite 400 Buffalo, NY 14210 Attn: Fernando A. Biscarra and Laramarie Calero, Supervisory Import Specialists RE: Application for Further Review of Protest Number 2002-18-100050; Concerning Product under Antidumping Order A-xxx-xxx Dear Center Director: The following is our decision regarding the Application for Further Review (“AFR”) of Protest Number 2002-2018-100050, filed on behalf of Protestant on July 25, 2018, which contests the antidumping duties (“ADD”) assessed on its entries of Product. This protest is designated the lead to protest number 4909-2018-100018, filed on July 27, 2018. Counsel has requested confidential treatment be afforded to certain information submitted in connection with this AFR request. In consideration of the request and sufficient justification presented pursuant to 19 C.F.R. § 177.2(b)(7), this office will not identify the party having any connection to the transactions under review nor any other identifying or financial information provided to U.S. Customs and Border Protection (“CBP”). FACTS: Protestant is a manufacturer of Product, which has been importing Product into the United States since 1987. According to CBP’s Automated Commercial Environment, (“ACE”), Protestant made 693 entries of Product, which it produced and exported, and are subject to this protest.  We note, however, that Protestant asserts that four of these entries were entered prior to the period of review (“POR”). Protestant does not dispute that these entries are subject to antidumping order A-xxx-xxx. At the time of entry Protestant made ADD cash deposits of []% ad valorem. With regard to the antidumping order on Product in April of 2013, the U.S. Department of Commerce (“Commerce” or “DOC”) published its final results of ADD administrative review for the POR. [] (“Final Results”). In these Final Results, Commerce assigned Protestant a dumping margin of []%, and instructed CBP, to collect cash deposits equal to this rate. Id. Subsequently, Protestant filed suit challenging Commerce’s determination. The Court of International Trade (“CIT”) issued a Temporary Restraining Order (“TRO”) and a preliminary injunction enjoining liquidation of the subject entries of the Product. See DOC Message No. xxxxxxx. After multiple appeals and affirmations Commerce’s Final Results were upheld in Federal Court. Following the conclusion of litigation, in DOC Message xxxxxxx, dated December [] 2017, Commerce issued liquidation instructions for all shipments of Product, produced and exported by Protestant and entered between the POR. Message xxxxxxx instructed CBP to liquidate and assess ADD liability of [] percent. Id. The Industrial and Manufacturing Materials Center for Excellence and Expertise (“Center”) liquidated 539 entries between February 2, 2018 and April 27, 2018. On February 2, 2018, and February 16, 2018, CBP attempted to liquidate 153 entries. However electronic notice of liquidation for these 153 entries failed to post to cbp.gov until September 18, 2018. One entry, number xxx-xxxxx7933, was liquidated on April 6, 2018, and noted in ACE as “voided” by the Port of San Juan (“the Port”), liquidation was suspended on June 7, 2018, and the entry was “deemed liquidated” on July 13, 2018, and then reliquidated on July 27, 2018; furthermore, liquidation was again suspended on February 7, 2019. The first notice of liquidation of entry number xxx-xxxx7933 was posted on July 13, 2018, and the comment “deemed liquidated” was included in ACE. On February 12, 2018, CBP notified Protestant that its $50,000 continuous import bond was insufficient and required a replacement bond at a higher amount. On March 30, 2018, Protestant requested a ruling from Regulations and Rulings (“RR”) for guidance on CBP’s authority to evaluate and accept claims for compromising ADD. We directed Protestant to CBP’s Office of Finance, which rejected Protestant’s offer in compromise. Additionally, Protestant has submitted a Freedom of Information Act (“FOIA”) request to RR’s FOIA Branch, regarding CBP interest calculation determination policy. Protestant filed two protests, on July 25, 2018, and July 27, 2018, respectively, protesting CBP’s handling of its entries. Additionally, Protestant submitted supplemental information and arguments on March 14, 2019, and January 21, 2020. Protestant does not dispute that its entries are subject to ADD under case number A-xxx-xxx or that Commerce directed that CBP assess a specific ADD rate of []% on its relevant entries. Additionally, Protestant concedes that its entries were subject to CBP instructions published in DOC Message No xxxxxxx, dated December [] 2017. Protestant advances the following arguments in its protest. ISSUES: Whether CBP failed to adhere to the Administrative Procedure Act (“APA”), notice and comment rulemaking requirements and therefore, denied Protestant due process, regarding: establishing bond sufficiency; CBP’s process for offers in compromise; CBP’s method of calculating its duty and interest liabilities, including the use of an “arbitrarily assigned ‘transaction date’” Whether CBP incorrectly calculated the amount of interest due; Whether CBP failed to post notices of liquidation for 153 entries, which, as a result, are deemed liquidated by operation of law; Whether CBP liquidated entries to which DOC Message No xxxxxxx did not apply; and Whether CBP arbitrarily suspended liquidation of an entry and therefore, cannot hold Protestant liable for duties, taxes, and fees on this entry. LAW AND ANAYLSIS: As a preliminary matter, Protestant asserts that all of its claims are properly the subject of a protest under 19 U.S.C. § 1514. Pursuant to 19 U.S.C. § 1514, CBP decisions are final unless a protest is timely filed against that decision, including liquidation, (see 19 U.S.C. § 1514(a)) in accordance with 19 U.S.C. § 1514(c). Protestant asserts that its “claims are protestable” and relies on Thyssenkrupp Steel N. Am., Inc. v. United States, (886 F.3d 1215 (Ct. App. Fed. Cir. 2018), (Thyssenkrupp), for support of this assertion. In Thyssenkrupp the plaintiff importer disagreed with CBP’s application of Commerce instructions when liquidating its entries subject to ADD. Protestant states that its claims, like those of Thyssenkrupp, focus on the application of Commerce instructions and therefore are protestable. With the exception of 4 of the 693 entries, Protestant complains about almost every aspect of CBP’s procedures with regard to bonds, interest calculations, and billing but does not assert that CBP improperly applied Commerce’s instructions, or contend that CBP should have applied the instructions in Message No xxxxxxx differently than it did. In fact, its only assertion with regard to these four entries is factual, i.e., that they were entered outside the time period addressed by the instructions. That is not the case in Thyssenkrupp, and therefore, the case does not apply here. However, inasmuch as Protestant protests the accuracy of the liquidation of its entries, we agree that liquidation is protestable and further review is afforded. See Xerox Corp. v. United States, 289 F.3d 792 (Ct. App. Fed. Cir. 2002); see also, Headquarters Ruling (“HQ”) 221591 (Feb. 13, 1990) (a mistake in the liquidation process can be corrected by one of the statutory methods set forth in 19 U.S.C. § 1514). We note that protest 2002-2018-100050 was timely filed, within 180 days from the dates of liquidations, as relating to 539 entries. See 19 U.S.C. § 1514(c)(3)(A). CBP liquidated 539 entries between February 2, 2018, and April 27, 2018. Additionally, on February 2, 2018, and February 16, 2018, CBP attempted to liquidate 153 entries; however notice of liquidation for these entries was posted on S

that CBP’s failure to provide a notice of suspension of liquidation pursuant to 19 U.S.C. § 1504(c) will only invalidate the suspension if the surety can demonstrate that CBP’s error caused it substantial prejudice) (internal citations omitted).In HQ H097501, dated July 14, 2014, we explained that the courts have held that “[a]n agency’s violation of a statutory procedural requirement does not necessarily invalidate the agency action, especially where Congress has not expressed any consequences for such a procedural violation.” HQ H097501 (July 14, 2014) (quoting Diaz v. Dep’t of Air Force, 63 F.3d 1107, 1109 (Ct. App. Fed. Cir. 1995)). The Supreme Court has also concluded: “[w]e would be most reluctant to conclude that every failure of an agency to observe a procedural requirement voids subsequent agency action, especially when important public rights are at stake.” Id. (Quoting Brock v. Pierce Cnty., 476 U.S. 253, 259-60, (1986)). In HQ H097501, we held that CBP’s failure to provide notice of the suspension of liquidation did not necessarily invalidate the suspension of liquidation for the entries at issue and require the entries to be deemed liquidated. “Rather, as explained by the Court of Appeals for the Federal Circuit in Great American Insurance Co. of NY, the rule of prejudicial error under the Administrative Procedure Act must be applied and [the importer] must demonstrate that it suffered substantial prejudice as a result of CBP’s procedural error before the suspension attached to the entries can be invalidated. See Id (quoting Great American Insurance Co. of NY, 738 F.3d at 1329-30 (Ct. App. Fed. Cir. 2013). Protestant does not provide any arguments or evidence that it was substantially prejudiced by these policies merely that CBP erred in the application of its ministerial duties applying its ADD. As explained in detail below, CBP applied regulations and statutes to liquidate Protestant entries. Protestant’s bond contentions are moot and, moreover, the g