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HQ 228712

May 13, 2002

PRO-2-02 RR:CR:DR 228712 LLB


Port Director of Customs

6747 Engle Road
Middleburg Heights, OH 44130

RE: Internal Advice; Protest No. 4101-99-100297; deemed liquidation; 19 U.S.C. § 1504(d); Fujitsu General America, Inc. et. al v. United States, 110 F. Supp. 2d 1061(Ct. Int’l Trade 2000), aff’d, No. 01-1042, 2002 Lexis 4402 (Fed. Cir. 2002); 19 U.S.C. § 1514; HQ 227793 (November 4, 1998); HQ 228249 (August 23, 1999); Rheem Metalurgica S/A v. United States, 951 F. Supp. 241, 249-50 (Ct. Int’l Trade 1996) aff’d 160 F. 3d 1357 (Fed. Cir.1998); Wolff Shoe Co. v. United States, 936 F. Supp. 1084, (Ct. Int'l Trade 1996), reversed in part, 141 F.3d 1116 (Fed. Cir. 1998); HQ 228678 (May 13, 2002)

Dear Sir or Madam:

This office has reviewed the Customs Protest and Summons Information Report, Customs Form 6445 dated January 10, 2000. Insofar as the protestant has not filed an application for further review of the foregoing protest, we are construing you submission of the CF 6445, as a request for internal advice. Our decision follows.


This protest involves entries

The entries protested are 885-xxxx580-5; 885-xxxx805-6; 885-xxxx076-9; 885-xxxx703-7; and 885-xxxx823-3. of cylindrical roller and radial ball bearings from Japan filed between October 1990 and March 1991. The merchandise was the subject of an antidumping order issued by the Department of Commerce (“Commerce”). See 54 Fed. Reg. 20904 (May 15, 1989). The order stated that the merchandise was subject to dumping margin of 51.21% and 73.55%, respectively, and accordingly, directed Customs to collect cash deposits of antidumping duties from the protestant on unliquidated entries of ball bearings filed on or after November 9, 1988. According to the Automated Commercial System (ACS), the cash deposits on the entries were fully paid.

In 1991, the entries were suspended as Commerce initiated a review of anti-friction bearings (other than tapered rolling bearings) from, inter alia, Japan for the relevant period of May 1, 1990 through April 30, 1991. 56 Fed. Reg. 29618 (June 28, 1991). On February 28, 1998, Commerce published its final results, as amended, of the administrative review for the subject period, indicating that appraisement instructions would be issued to Customs after publication. 63 Fed. Reg. 8908 (1998). On June 9, 1998, Commerce issued Customs instructions to liquidate entries of ball bearings imported by American Koyo Corporation at a dumping margin of 9.92% and cylindrical roller bearings imported by the same at 1.89%.

On September 10, 1999, protestant wrote a letter to Customs stating that its records showed that the entries should have liquidated according to the aforementioned instructions issued by Commerce. The protestant inquired whether the subject entries had been liquidated and if not, requested that the entries be liquidated. According to ACS, the entries were liquidated “no change” on October 8, 1999. A protest was filed arguing that the entries were deemed liquidated; however, not at the dumping margin asserted at the time of entry, e.g. 73.55% and 51.21%, but at the final assessment rate issued by Commerce, plus interest thereto.


1. Whether the matter is protestable and timely under 19 U.S.C. § 1514

2. Whether the subject entries were deemed liquidated by operation of law pursuant to 19 U.S.C. § 1504 a.) If so, whether the countervailing duty rate is the countervailing duty rate “asserted at the time of entry by the importer of record” or the rate indicated in the liquidation instructions from the Department of Commerce

Issue 1

Generally, decisions of the Customs Service, including, inter alia, the liquidation or reliquidation of an entry, are final unless a valid protest is filed. 19 U.S.C. § 1514(a)(5). The protestant argues that the subject entry deemed liquidated. The Court of International Trade recently held that deemed liquidation occurs by operation of law, and, therefore, does not involve a Customs decision. Fujitsu General America, Inc. et. al v. United States, 110 F. Supp. 2d 1061, 1069 (Ct. Int’l Trade 2000), aff’d, No. 01-1042, 2002 Lexis 4402 (Fed. Cir. 2002). However, “[a] Customs decision to liquidate certain entries anew after the entries had already deemed liquidated is a protestable decision under 19 U.S.C. § 1514(a)(5).” Id. (internal citation omitted). In HQ 228678 (February 27, 2002) citing Fujitsu, supra, Customs held that its liquidation of an entry close to two months after the entry had deemed liquidated constituted a protestable decision under § 1514. Similarly, in the present case, Customs liquidated the subject entry on October 8, 1999, close to ten months after the entry deemed liquidated (as discussed in Issue 2), and therefore, pursuant to Fujitsu and HQ 228678, such liquidation constituted a Customs decision that is protestable under 19 U.S.C. § 1514(a)(5).

In addition, the protest must be filed within 90 days after, but not before, the notice of liquidation. 19 U.S.C. §1514(c)(3). Since the protestant filed the protest on November 8, 1999, the protest is well within 90 days of the October 8, 1999, liquidation date; and, therefore timely.

Issue 2

Pursuant to 19 U.S.C. 1504(d),
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 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. Section 1504(d) of Title 19 (1988) was amended by §641(2) of Pub.L. 103-182, the North American Free Trade Agreement Implementation Act (107 Stat. 2057), enacted December 8, 1993.1 Section 641(2) of the NAFTA Implementation Act took effect on December 8, 1993, the date of enactment of the Act. Since liquidation of the merchandise occurred after the date of the NAFTA Implementation Act, the amendment applies in this instance. See Travenol Laboratories v. U.S., 118 F.3d 749 (Fed. Cir. 1997).

(emphasis added). According to the record, the liquidation instructions regarding the subject merchandise were issued on June 9, 1998. Therefore, the entries deemed liquidated on December 9, 1998.

The protestant argues that the entries should be liquidated at 9.92 and 1.89 percent, which are the rates indicated in Commerce’s liquidation instructions. Customs has held in countervailing cases, and continues to affirm here, "that entries subject to countervailing duties which [were] liquidated by operation of law, [are] liquidated with countervailing duties due at the rate at which the importer was required to post a bond or deposit cash, upon entry." HQ 227793 (November 4, 1998); HQ 228249 (August 23, 1999); HQ 228678, supra; see Rheem Metalurgica S/A v. United States, 951 F. Supp. 241, 249-50 (Ct. Int’l Trade 1996)(Rheem I), aff’d 160 F. 3d 1357 (Fed. Cir.1998)(Rheem II). In Rheem I, the Court of International Trade held, "[t]he meaning of ‘asserted’ in § 1504(d) . . . means that which is claimed and indicated by the importer, his consignee or agent on the entry summary or warehouse withdrawal." Id. at 249, citing Customs Regulations, Relating to the Entry of Merchandise, Liquidation of Entries, Warehousing Periods, and Marking of Bulk Containers of Alcoholic Beverages, Amended, 44 Fed. Reg. 46,794, 46,809 (August 9, 1979).

Wolff Shoe Co. v. United States, 936 F. Supp. 1084, (Ct. Int'l Trade 1996), reversed in part, 141 F.3d 1116 (Fed. Cir. 1998) also addressed the foregoing issue. In Wolff, the plaintiffs argued the language of 19 U.S.C. §1504(d) should be interpreted to provide a refund of all countervailing duties that had been deposited. Wolff, 141 F. 3d at 1123. See HQ 224627 (December 23, 1996)(applying the holding in Wolff to anti-dumping case). The Court held that, "duty asserted at the time of entry by the importer" means "all of the duties claimed on the entry papers, including countervailing duties.” Wolff, 141 F.3d at 1123, citing American Permac Inc. v. United States, 642 F. Supp. 1187, 1195 n.12 (Ct. Int’l Trade 1986)(holding that "[t]he amount of duties 'asserted at the time of entry by the importer,' within the meaning of § 1504(a) and (d), is not what the importer desires to assert upon entry, but what the importer is required by Customs officers to assert when filing the entry summary."); see Rheem II, 160 F.3d at 1359.

Based on the foregoing, the subject entry was liquidated by operation of law with anti-dumping duties at the rate required of the importer to post its bond or cash deposit upon entry of its merchandise. See Rheem and Wolff, supra.


Insofar as Customs liquidated the entry after the entry liquidated by operation of law, Customs liquidation of the entry constituted a Customs decision and is, therefore, protestable under 19 U.S.C. § 1514(a)(5). However, while the entry was liquidated by operation of law, the port’s liquidation was consistent with 19 U.S.C. § 1504. The protest should be DENIED.

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.


John Durant, Director

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