H309718

HQ H309718 November 26, 2024 OR:RR:CTF:EPDR H309718 ND Category: Entry Center Director Automotive and Aerospace Center for Excellence and Expertise 1 World Trade Center Suite 741 Long Beach, CA 90831 Attn: Judy Staudt, Assistant Center Director and Lillian Imes, Supervisory Import Specialist Re: Application for Further Review of Protest Number 5301-23-109115; New Pneumatic Off-the-Road Tires from the People’s Republic of China; Antidumping and Countervailing Duties Dear Center Director, The purpose of this decision is to address the application for further review (“AFR”) of Protest Number 5301-23-109115 filed by Leviathan Corp. d/b/a OTRUSA (“Leviathan”), regarding the assessment of antidumping duties (“ADD”) pursuant to case number A-570-912 and countervailing duties (“CVD”) pursuant to case number C-570-913. FACTS: On December 7, 2012, Leviathan entered a single entry, number XXX-XXXX575-7, of thirty-six pneumatic off-the road tires (“OTR tires”) from the People’s Republic of China (“China”). New pneumatic off-the-road tires (“OTR tires”) from China are subject to the ADD order in case number A-570-912 and the CVD order in case number C-570-913 (collectively “the Orders”). See Certain New Pneumatic Off-the-Road Tires from the People’s Republic of China: Notice of Amended Final Affirmative Determination of Sales at Less Than Fair Value and Antidumping Duty Order, 73 Fed. Reg. 51,624 (Sept. 4, 2008); Certain New Pneumatic Off-the-Road Tires from the People’s Republic of China: Countervailing Duty Order, 73 Fed. Reg. 51,626 (Sept. 4, 2008). Upon entry, Leviathan entered the OTR tires as a “type 01” entry and did not identify the merchandise as subject to the Orders. Upon review by U.S. Customs and Border Protection (“CBP”), Leviathan amended the entry to “type 03” and asserted the ADD rate and CVD rate were 12.83% and 5.65% respectively. On November 27, 2013, with respect to case number C-570-913, the Department of Commerce (“Commerce”) directed CBP to assess CVD for entries of OTR tires from China entered for consumption between January 1, 2012, and December 31, 2012, at the cash deposit rate in effect on the date of entry, which was 5.65%. Message No. 3331317; see also Implementation of Determinations Under Section 129 of the Uruguay Round Agreements Act: Certain New Pneumatic Off-the-Road Tires; Circular Welded Carbon Quality Steel Pipe; Laminated Woven Sacks; and Light-Walled Rectangular Pipe and Tube From the People's Republic of China, 77 Fed. Reg. 52,683 (Aug. 30, 2012). Also on November 27, 2013, with respect to case number A-570-912, Commerce directed CBP to assess ADD for entries of tires from China entered for consumption between September 1, 2012, and August 31, 2013, that were produced and exported by Triangle Tyre Co., LTC (“Triangle Tyre”) at the cash deposit rate in effect on the date of entry, which was 12.83%. Message No. 3331303; see also Implementation of Determinations Under Section 129 of the Uruguay Round Agreements Act: Certain New Pneumatic Off-the-Road Tires; Circular Welded Carbon Quality Steel Pipe; Laminated Woven Sacks; and Light-Walled Rectangular Pipe and Tube From the People's Republic of China, 77 Fed. Reg. 52,683 (Aug. 30, 2012). On May 5, 2015, Commerce notified CBP of an injunction that enjoined all entries exported by the China-wide entity and were entered for consumption between September 1, 2012, and August 31, 2013. Message No. 5125301. On November 4, 2022, Commerce notified CBP that the injunction had been lifted and instructed CBP to assess ADD for shipments of OTR tires exported by the China-wide entity entered for consumption between September 1, 2012, and August 31, 2013, at 105.31%. Message No. 2308402. Because CBP initially determined that the exporter was Tianjin Leviathan International Trade Co., Ltd. (“Tianjin”), CBP did not assess the exporter and producer combination rate for ADD afforded to Triangle Tyre. Rather, on December 9, 2022, CBP liquidated the subject entry and assessed antidumping duties at the China-wide rate of 105.31% and countervailing duties at the rate of 5.65%. On June 6, 2023, Leviathan protested the assessed ADD. Leviathan argues that CBP erroneously assessed ADD duties at the China-wide rate rather than the exporter and producer combination rate attributed to Triangle Tyre. Thus, Leviathan believes the entry should have liquidated with ADD equal to the cash deposit rate for merchandise exported and produced by Triangle Tyre as asserted on the date of entry. We note that in its protest Leviathan argues that cash deposit rate for ADD was 13.92% by referencing Commerce’s change to the cash deposit made effective March 23, 2015. See Certain New Pneumatic Off-the-Road Tires From the People's Republic of China: Notice of Amended Final Determination Pursuant to a Final Court Decision, 81 Fed. Reg. 47754 (July 22, 2016). The cash deposit effective at the entry date of December 7, 2012, however, was 12.83%. Implementation of Determinations Under Section 129 of the Uruguay Round Agreements Act: Certain New Pneumatic Off-the-Road Tires; Circular Welded Carbon Quality Steel Pipe; Laminated Woven Sacks; and Light-Walled Rectangular Pipe and Tube From the People's Republic of China, 77 Fed. Reg. 52,683 (Aug. 30, 2012). We also note that there is no dispute as to the CVD rate applicable to Leviathan’s entry and, accordingly, we only address the matter of the applicable ADD rate. In support of its argument, Leviathan has provided several transactional documents, including two sales contracts, two commercial invoices, two packing lists, a bill of lading, and a bank statement demonstrating a payment from Leviathan to Triangle Tyre. The sales contracts, commercial invoices, and packing list concern the sale and transportation of thirty-six OTR tires. The first sales contract, dated November 1, 2012, covers the purchase of thirty-six Triangle Tyre OTR tires and lists Leviathan as the buyer, Tianjin as the payer, and Triangle Tyre as the seller and beneficiary. The second sales contract, dated November 12, 2012, is on Tianjin letterhead and lists Leviathan as the buyer and Tianjin as the seller and beneficiary. The first commercial invoice, dated November 1, 2012, is on Triangle Tyre letterhead and lists Leviathan as the buyer, Tianjin as the payer. The second commercial invoice, dated November 14, 2012, is on Tianjin letterhead and lists Leviathan as the buyer and Tianjin as the seller. The first packing list, dated November 10, 2012, is on Triangle Tyre letterhead and lists Leviathan as the buyer, Tianjin as the payer, and Triangle Tyre as the producer and exporter. The second packing list, dated November 14, 2012, is between Tianjin and Leviathan. The first sales contract, first commercial invoice, and first packing list all note the destination from Qingdao, China, to Houston, United States, and all reference the same invoice number. The bill of lading identifies Tianjin as the shipper and Leviathan as the consignee. Although the bill of lading does not reference Triangle Tyre, the container number and seal number matches those on Triangle Tyre’s packing list. Furthermore, all documents are consistent in that the merchandise was exported from the Port of Qingdao, China rather than the Port of Tianjin, China where Tianjin is located. Leviathan has further provided an agency contract between Leviathan and Tianjin that identifies Tianjin as a bona fide buying agent acting on behalf of Leviathan. Lastly, Leviathan provided a bank statement showing a $40,000 deposit sent to Triangle Tyre a couple months prior to the subject shipment along with contemporaneous emails between Leviathan and Triangle Tyre memorializing the negotiation for the deposit amount. ISSUES: Whether CBP properly assessed ADD at the correct rate on entry number XXX-XXXX575-7. Whether entry number XXX-XXXX575-7 deemed liquidated by operation of law. LAW AND ANALYSIS: As an initial matter, we note that this protest meets the crite

As an initial matter, we note that this protest meets the criteria for further review. Specifically, it raises questions of fact concerning the proper designation of transactional parties with respect to entry number XXX-XXXX575-7, which has not been ruled upon by the Commissioner of CBP or his designee or by the Customs courts. See 19 C.F.R. § 174.24(b). Additionally, we note that Protest Number 5301-23-109115 was timely filed. Pursuant to 19 U.S.C. § 1514(c)(3)(A), a party must file a protest within 180 days after the date of liquidation. Leviathan filed this protest on June 6, 2023, within 180 days of the December 9, 2022, liquidation date of entry number XXX-XXXX575-7.Whether CBP properly assessed ADD at the correct rate on entry number XXX-XXXX575-7.Once Commerce instructs CBP to liquidate entries, “[CBP] merely follows Commerce’s instructions in assessing and collecting duties.” Mitsubishi Elecs. Am. Inc. v. United States, 44 F.3d 973, 977 (Fed. Cir. 1994). Further, CBP cannot “‘modify’ . . . [Commerce’s] determinations, their underlying facts, or their enforcement.’” Id. (quoting Royal Bus. Machs. Inc. v. United States, 507 F. Supp. 1007, 1014 n. 18 (Ct. Int’l Trade 1980)). Customs plays a “merely ministerial role in liquidating [ADD].” Id. “Customs should do no more than enact the intentions of Commerce.” See e.g., Shinyei Corp. of. Am. v. United States, 35 C.I.T. 666, 669 (2011) (requiring Customs to consider documentation submitted at protest evidencing a sale, which occurred after entry, to an ultimate “sold to” customer listed in Commerce instruction). To determine the parties to a transaction, CBP has traditionally looked to the documentation filed along with the entry, such as a commercial invoice. For example, in Headquarters Ruling Letter (“HQ”) H300287, dated February 25, 2019, CBP relied on multiple commercial invoices that corresponded to the entry data on the CBP Form 7501 to establish the “customer” in a transaction for purposes of determining w