Application for Further Review, Protest No. 2809-01-100085; 19 U.S.C. 1504(d); 19 U.S.C. 1675(a)(3)(C); 19 U.S.C. 1677g.

HQ W229099 July 25, 2001 LIQ-4-01; LIQ-15 RR:CR:DR 229099 DR CATEGORY: Protest Port Director of Customs Attn: B. Horne 555 Battery St. San Francisco, CA 94126 RE: Application for Further Review, Protest No. 2809-01-100085; 19 U.S.C. 1504(d); 19 U.S.C. 1675(a)(3)(C); 19 U.S.C. 1677g. Dear Mrs. Horne: The above referenced protest was forwarded to this office for a determination. We have considered the points raised and a decision follows. FACTS: The subject protest covers four entries of roller chain, other than bicycle, made between April 27, 1982, and December 23, 1982; one entry made on May 23, 1990; and one entry made on September 5, 1990. The merchandise was the subject of antidumping order Roller Chain, Other Than Bicycle, From Japan, 38 Fed. Reg. 9226 (April 12, 1973) (“Japan Roller Chain”) issued by the Department of Commerce (“Commerce”). According to the record before us, the subject merchandise was manufactured by Sugiyama Chain Co., Ltd., of Japan (“Sugiyama”) and exported from Japan by I&OC of Japan Co., Ltd. (“IOC”). In 1986, liquidation of the 1982 entries was suspended as Commerce initiated a review of Japan Roller Chain for the relevant periods April 1, 1981 through March 31, 1985, along with other periods. See Initiation of Antidumping Duty Administrative Reviews 51 Fed. Reg. 24883 (July 9, 1986). On January 31, 1992, Commerce published the preliminary results of its administrative review of the antidumping finding on roller chain, other than bicycle, from Japan. See 57 Fed. Reg. 3745. The subject merchandise exported by IOC between April 1, 1982 and March 31, 1983 was found to have a weighted-average margin of 14.21%, and Commerce stated that it would determine, and the Customs would assess, antidumping duties on all appropriate entries, and Commerce would issue appraisement instructions directly to Customs. On September 22, 1992, Commerce published the final results of its administrative review of the Japan Roller Chain antidumping findings with respect to Sugiyama and various Japanese exporters (including IOC) of Sugiyama products to the United States for the periods April 1, 1981, through March 31, 1987, and April 1, 1989, through March 31, 1990. See 57 Fed. Reg. 43697. In the notice, the subject merchandise exported by IOC between April 1, 1982 and March 31, 1983 was found to have a weighted-average margin of 5.45%, and Commerce stated that it would determine, and Customs would assess, antidumping duties on all appropriate entries, and Commerce would issue appraisement instructions directly to Customs. However, Sugiyama and IOC challenged those final results in the CIT and obtained an injunction against liquidation of its entries during the pendency of the CIT lawsuit. See Sugiyama Chain Co., Ltd., et al., v. U.S., 852 F. Supp. 103, 19 CIT 423 (1994). The injunction was carried forward through appeal to the Court of Appeals for the Federal Circuit (“CAFC”) until November 1, 1995, when the CAFC issued its mandate affirming Commerce’s antidumping duty assessment for the entries. See Sugiyama Chain Co., Ltd., et al., v. U.S., 70 F.3d. 1290 (Fed.Cir. 1995). Also, on May 21, 1991, liquidation of the 1990 entries was suspended as Commerce initiated a review of Japan Roller Chain for the period April 1, 1990 through March 31, 1991. See 56 Fed. Reg. 23271 (May 21, 1991). The preliminary results of that review were published on February 20, 1992, and covered Sugiyama and various Japanese exporters (including IOC) of Sugiyama products. See 57 Fed. Reg. 6097 (Feb. 20, 1992). Final results of the review were published on November 27, 1992. See 57 Fed. Reg. 56319 (Nov. 27, 1982), as amended by 57 Fed. Reg. 58285 (Dec. 9, 1992). In the notice of final results, the subject merchandise exported by IOC was subjected to a dumping margin of 5.83%. The notice also stated that Commerce would instruct Customs to assess antidumping duties on all appropriate entries and would issue appraisement instructions for all companies directly to Customs. Liquidation was enjoined as Sugiyama and IOC challenged those final results in the CIT. See Sugiyama Chain Co., Ltd., et al., v. U.S., 865 F. Supp. 843, 18 CIT 703 (July 27, 1994). That case was eventually dismissed on June 23, 1995, when the court sustained Commerce’s determinations. Sugiyama Chain Co., Ltd., et al., v. U.S., 891 F. Supp. 619, 19 CIT 903 (1995). On September 18, 2000, Commerce issued liquidation instructions to Customs for the subject merchandise entered between April 1, 1982 and March 31, 1983, and between April 1, 1990 and March 31, 1991. Both sets of instructions noted that the assessment of antidumping duties by Customs on entries of the subject merchandise is subject to the provisions of section 778 of the Tariff Act of 1930 (19 U.S.C. 1677g). Furthermore, the instructions noted that the interest provisions are not applicable to cash or bonds posted as estimated antidumping duties before the date of publication of the antidumping duty order, and interest shall be calculated from the date payment of estimated antidumping duties is required through the date of liquidation. Customs liquidated all of the subject entries on October 13, 2000. Pursuant to 19 U.S.C. 1514, Protestant filed this protest of the liquidations on January 8, 2001, and the port preliminarily determined that it did not “involve either ‘scope’ or ‘margin rate’ and should be forwarded for further review.” The protest and AFR was forwarded to this office on February 23, 2001, pursuant to 19 C.F.R. 174.24. ISSUES: Whether Customs’ assessments of antidumping duties on the subject entries barred by the statutes of limitation in 19 U.S.C. 1504(d) or 19 U.S.C. 1675(a)(3)(C) Whether Customs’ assessments of interest on underpaid antidumping cash deposits was proper LAW AND ANALYSIS: First, we note that the protest was timely filed. The merchandise was liquidated on October 13, 2000, and Protestant filed the protest on January 8, 2001. In accordance with 19 C.F.R. 174.24, the port has forwarded this application for further review to this office for review. Protestant argues that 19 U.S.C. 1675(a)(3)(C) is inapplicable here and 19 U.S.C. 1504(d), as amended, would thus apply. Protestant states that because Commerce failed to transmit to the Federal Register for publication the final disposition of the Sugiyama decisions and issue instructions to Customs within 10 days after the courts’ final decisions, the scenario described in §1675(a)(3)(C) “breaks down.” Title 19, section 1504(d) (1994 ed.)  states as follows: 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, unless liquidation is extended under [19 U.S.C. 1504)(b)], 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 has been extended under [19 U.S.C. 1504)(b)]) 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. And §1675(a)(3)(C) states as follows: In a case in which a final determination under paragraph (1) is under review under section 1516a of this title and a liquidation of entries covered by the determination is enjoined under section 1516a(c)(2) of this title or suspended under section 1516a(g)(5)(C) of this title, the administering authority shall, within 10 days after the final disposition of the review under section 1516a of this title, transmit to the Federal Register for publication the final disposition and issue instructions to the Customs Service with respect to the liquidation of entries pursuant to the review. In such a case, the 90-day liquidation period referred to in subparagraph (B) shall begin on the day on which the administering authority issues such instructions. Contrary to Protestant’s assertions, §1675(a)(3)(C) does in fact remain applicable because although Commerce may have failed to adhere to the time limits imposed by that section, such failure does not negate the duties imposed by that section and exempt Commerce from its application, and Customs would still be required to liquidate the entries within 90 days after receiving Commerce’s instructions. Here, the court actions were commenced under 19 U.S.C. 1516a and the liquidations were enjoined, with final disposition occurring in 1995 when the CIT and the CAFC affirmed Commerce’s antidumping duty assessments for the subject entries. See supra, Sugiyama, 70 F.3d. 1290 (Fed.Cir. 1995); Sugiyama, 891 F. Supp. 619, 19 CIT 903 (1995). However, Commerce did not issue liquidation instructions to Customs until September 18, 2000, and Customs liquidated on October 13, 2000. We note that numerous administrative Headquarters decisions have been issued which stand for the proposition that the date for lifting the liquidation suspension is the date that Customs receives instructions from Commerce to liquidate the subject entries. See, e.g., HQ 225783 (January 16, 1996); HQ 226285 (October 10, 1997); HQ 227793 (November 4, 1998); HQ 227562 (March 3, 1999); HQ 224778 (December 23, 1993); HQ 225107 (September 20, 1994). Various statements of the courts support those rulings. The Court of International Trade (CIT) has held that Customs’ obligation to collect antidumping duties does not arise until Commerce has “furnished” Customs with the determination upon which assessments must be predicated. See American Permac, Inc. v. U.S., 642 F. Supp. 1187, 1193-4, 10 CIT 535, 542 (1986). Both the CIT and the Court of Appeals for the Federal Circuit (CAFC) also referred to Commerce as having “notified” or “directed” Customs to proceed with liquidation. See Pagoda Trading Corp. v. U.S., 9 CIT 407, 408 (1985), aff’d 5. Fed. Cir. (T) 10, 14 (1986). Although the CIT has held in International Trading Co. v. U.S., 110 F. Supp. 2d 977, 2000 Ct. Int’l. Trade LEXIS 85, CIT Slip Op. 2000-83 (2000) (app’l pending), that the suspension of liquidation is removed upon the publication in the Federal Register of the final results of an antidumping administrative review, that case is under appeal. In this case, the bars to liquidation of the subject entries were removed on September 18, 2000, when the Commerce issued the liquidation instructions. Customs then liquidated the entries less than one month after the issuance of the instructions, well within the period set by the plain language of 19 U.S.C. 1675(a)(3)(C). Therefore, the liquidations were not liquidated by operation law, as asserted by Protestant, and this protest should be denied with regard to the argument that the liquidations by Customs were time-barred. **** Additionally, Protestant argues that Customs is barred from assessing interest on underpaid antidumping cash deposits because Commerce was “clearly negligent” in not promptly completing the relevant administrative review and issuing the attendant liquidation issues. Protestant argues that it was not required to make a cash deposit of estimated antidumping duties at the time of entry and therefore cannot be assessed interest on the difference between the 0% required at entry and the ultimate rates of 5.45% and 5.83% for the two review periods. First, we note that under ABC International Traders, Inc. v. United States, 19 CIT 787, 1995 Ct. Intl. Trade LEXIS 136; CIT Slip Op.95-97 (May 23, 1995); Mitsubishi Electronics America Inc. v. United States, 44 F. 3d 973 (Fed.Cir. 1994); and Nichimen America v. United States, 9 Fed. Cir. (T) 103, 938 F. 2d 1286 (1991), the assessment of interest on such overpayments or underpayments of antidumping duties, when assessed pursuant to instructions from the Department of Commerce, may not be challenged by protest under 19 U.S.C. §1514. See, e.g., HQ 225382 (July 3, 1995). We have also held that the role of Customs in the antidumping process is “simply to follow Commerce’s instructions in collecting deposits of estimated duties and in assessing antidumping duties, together with interest, at the time of liquidation.” HQ 225382 (July 3, 1995); see also, Mitsubishi, Nichimen America. However, if Customs fails to follow the instructions of the Department of Commerce, that failure may be subject to protest under 19 U.S.C. §1514. See, e.g., ABC International Traders (“...claims [that Customs erroneously liquidated certain entries and failed to follow Commerce’s liquidation instructions] may be brought before the court under 28 U.S.C. 1581(a) (1988), after denial of protests by Customs”); American Hi-Fi (“[j]urisdiction for actions challenging Customs’ failure to follow Commerce’s actual liquidation instructions ... is found under 28 U.S.C. 1581(a)”). Furthermore, Pagoda Trading Co. v. United States, 9 CIT 407, 617 F. Supp 96 (1985), aff’d, 804 F.2d 665 (1986), Koyo Seiko Co., Ltd. v. United States, 16 CIT 366, 796 F. Supp. 517 (1992), and St. Paul Fire & Marine Insurance Co. v. United States, 16 CIT 663, 799 F. Supp. 120 (1992), rev’d, 6 F.3d 763 (1993), which address the relationship between the delay of liquidation instructions being issued and the accumulated interest charges, and which Protestant cites in support of its assertions regarding the interest charges, do not detract from Customs’ position because each of those cases involved either a lengthy delay by Commerce in issuing the instructions or a lengthy delay by Customs in liquidating the entries after receiving liquidation instructions from Commerce. Here, neither scenario exists. There is no allegation that Customs failed to follow the liquidation instructions issued by DOC. Indeed, Protestants admits that Customs did not fail to liquidate the entries expeditiously after receiving liquidation instructions from Commerce. See page 5 of Protestant’s Memorandum. Instead, the protest challenges the timing and content of the instructions themselves, neither of which are protestable matters for Customs to address. The liquidation instructions were not received until September 18, 2000, and Customs was unable to liquidate the subject entries until it received those instructions. As a result, the 90-day limitation period tolled on that date, and Customs liquidated the entries well within that period. Furthermore under 19 U.S.C. 1677g(a), interest shall be payable on overpayments or underpayments of amounts deposited on merchandise entered, or withdrawn from warehouse, for consumption on and after the date of publication of a countervailing or antidumping order or the date of a finding under the Antidumping Act, 1921 (represented by the difference between the required cash deposit of estimated antidumping duties that was actually deposited and the final amount of assessed duties on the date of liquidation). In HQ 226263 (December 10, 1996) we stated that the courts have conclusively held that 19 U.S.C. 1677g “requires interest only when a cash deposit of estimated duties is required under an antidumping order.”  See Dynacraft Industries, Inc. v. United States, 118 F. Supp. 2d 1286 (2000) (where estimated antidumping duties are required to be deposited pursuant 19 U.S.C. 1673e(a)(3), then 19 U.S.C. 1673f(b) explicitly provides for the recovery of interest pursuant to 19 U.S.C. 1677g). However, where the estimated rate is 0% or where Commerce waives the cash deposit, and thus no actual cash deposit has been made, then upon the determination of the final assessed duty, the importer is still required to pay interest on the ultimate underpaid amount. Here, protestant was required to make a cash deposit of 0% of the estimated duties at the time of entry, and once the final orders were published and liquidation instructions were issued, the importer was assessed antidumping duties of 5.45% and 5.83%, with interest to be assessed on any underpayments. As stated by the CAFC in Sharp Electronics Corporation v. U.S., 124 F.3d 1447, 1449 (Fed.Cir. 1997), To be sure, section 1677g speaks in terms of "amounts deposited," but it also speaks to "underpayments." Here, the underpayment was 100% of the final assessed duty. Therefore, interest is due on the entire assessment, unless the provision only applies when "amounts" are actually "deposited." We hold the provision applies whenever such amounts are statutorily owed, whether or not actually deposited, because any other result would be absurd. See also American Hi-Fi International Inc. v. U.S., 936 F. Supp. 1032, 20 CIT 910 (1996). Therefore, this protest should be denied with regard to the argument that Customs was barred from assessing interest on any underpaid antidumping cash deposits. HOLDING: This protest should be DENIED. In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed by your office 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 Customs personnel, and to the public on the Customs Home Page on the World Wide Web at www.customs.gov, by means of the Freedom of Information Act and other methods of public distribution. Sincerely, John Durant Director, Commercial Rulings Division