International Trading Co. v. U.S.
| Decision Date | 01 March 2002 |
| Docket Number | No. 00-1577.,00-1577. |
| Citation | 281 F.3d 1268 |
| Parties | INTERNATIONAL TRADING COMPANY, Plaintiff-Appellee, v. UNITED STATES, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Federal Circuit |
R. Brian Burke, Rode & Qualey, of New York, NY, argued for plaintiff-appellee. With him on the brief was William J. Maloney.
James A. Curley, Attorney, Civil Division, Commercial Litigation Branch, Department of Justice, of New York, NY, argued for defendant-appellant. With him on the brief were Stuart E. Schiffer, Deputy Assistant Attorney General; David M. Cohen, Director, Department of Justice, of Washington, DC; and Joseph I. Liebman, Attorney in Charge, International Trade Field Office. Of counsel on the brief were Edward N. Maurer, Attorney, Office of Assistant Chief Counsel, United States Customs Service, of New York, NY; and Cindy G. Buys, Attorney, Office of Chief Counsel for Import Administration, Department of Commerce, of Washington, DC.
Before NEWMAN, RADER, and BRYSON, Circuit Judges.
The government appeals from a decision of the United States Court of International Trade holding that the Customs Service did not liquidate particular entries within the statutorily allotted time, and that those entries therefore were deemed liquidated at the rate deposited by the importer. The government challenges the court's decision as to when the period for Customs to liquidate the entries began to run. We reject the government's arguments and affirm the trial court's judgment.
Between March 1993 and February 1994, the International Trading Company ("ITC") imported shop towels from a company in Bangladesh, Sonar Cotton Mills (Bangladesh) Ltd. At the time of entry into the United States, the towels were subject to an antidumping order that required a cash deposit of antidumping duties at the rate of 2.72%. In April 1994, the Department of Commerce published a notice in the Federal Register that it would conduct an administrative review of the antidumping duty order on shop towels from Bangladesh covering the period of March 1, 1993, to February 28, 1994. Liquidation of the entries falling within the scope of the review was suspended pursuant to 19 U.S.C. § 1673b(d).
On February 12, 1996, Commerce published the final results of the administrative review in the Federal Register. The final results announced an antidumping duty rate of 42.31% for Sonar's towels. The next day, Commerce sent an e-mail message to Customs. Referring to the Federal Register entry of the previous day, the message noted that the administrative review had been completed, but it advised Customs not to liquidate any entries covered by the review until it received liquidation instructions.
More than six months later, on August 29, 1996, Commerce sent another e-mail message to Customs. That message, which was designated "non-public," directed Customs to assess antidumping duties at the rate of 42.31% on imports of Sonar's towels and stated "these instructions constitute the immediate lifting of suspension of liquidation of entry summaries for the merchandise and period listed above."
Customs liquidated the entries in October of 1996 and assessed antidumping duties at the rate of 42.31% of the entered value. ITC filed a formal protest, arguing that the entries were deemed liquidated by operation of law under 19 U.S.C. § 1504(d) at the rate ITC asserted at the time of entry, i.e., at the deposit rate of 2.72%, because Customs did not liquidate the entries within six months after receiving notice of the removal of suspension of liquidation. The protest was denied, and ITC's request for further administrative review was denied in a letter ruling by Customs.
ITC then filed this action in the Court of International Trade, contending that the entries should be deemed liquidated at the deposit rate. The court held that the statutory suspension of liquidation had been removed upon the publication of the final results of the administrative review in the Federal Register and that the e-mail message sent to Customs the following day provided notice to Customs that suspension had been lifted. Accordingly, the court concluded that Customs had failed to liquidate the entries within six months after receiving notice of the removal of suspension, as required by 19 U.S.C. § 1504(d). Because Customs had failed to liquidate the entries within the allotted period, the court held that the entries were deemed liquidated at the deposit rate. The government then took this appeal.
The statute that is the focus of this case, 19 U.S.C. § 1504(d) (Supp. V 1993), provides that when a suspension of liquidation 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.
That statute has subsequently been amended, but not in ways material to the issue in this case.1 Because section 1504 provides that an entry will be deemed liquidated by operation of law if Customs does not liquidate the entry within six months of receiving notice from Commerce that the suspension has been removed, it is critical to determine what constitutes the act that effects the removal of suspension and what constitutes notice of the removal to Customs. Unfortunately, neither section 1504 nor any other statute or regulation defines those statutory terms. Like the trial court, we therefore look to the structure and purposes of the Tariff Act to give those terms meaning.
The trial court agreed with ITC that suspension of liquidation for the entries at issue in this case was removed when the final results of the administrative review were published in the Federal Register. The government disagrees and argues that the suspension of liquidation was not removed until after (1) the final results were published and (2) Commerce instructed Customs to liquidate the entries. We reject the government's argument and agree with the trial court that suspension was removed upon publication of the final results in the Federal Register.
The statutory scheme governing suspension of liquidation supports the trial court's conclusion that suspension of liquidation was removed when the final results of the administrative review were published in the Federal Register. Liquidation of a particular class of entries is suspended when Commerce publishes in the Federal Register an affirmative preliminary or final determination in an antidumping investigation covering those entries. See 19 U.S.C. §§ 1673b(d) (1988); 1673d(c)(1)(C) (1994). Liquidation is suspended in that setting because it is not possible, at that point, to determine what duties will be assessed against those entries. It follows logically that suspension should be removed as soon as it is possible to determine the appropriate duties, which occurs when the antidumping duty order is issued or the final results of an administrative review are announced. The statutes providing for the publication of an antidumping duty order or the final results of an administrative review are consistent with that understanding. In the case of antidumping duty orders, the applicable statute provides that the order should set forth the antidumping duty rate and directs Customs officers to assess antidumping duties promptly against the entries that are subject to the order. 19 U.S.C. § 1673e(a) (1994). In the case of the published final results of an administrative review, the applicable statute provides that the final results should set forth the determination of antidumping duty rates that "shall be the basis for the assessment of antidumping duties" on the subject entries. 19 U.S.C. § 1675(a)(2) (1988). A fair construction of those statutes is that because they impose an obligation on Customs to liquidate the entries promptly after publication of the order in question, the suspension of liquidation is removed as of the time of the publication. Moreover, as the trial court noted, tying the removal of suspension to the issuance of an antidumping duty order or the final results in an administrative review has the virtue of parallelism with the mechanism by which suspension was initiated; thus, suspension is begun by publication of an announcement of the beginning of the antidumping investigation, and suspension is removed by the publication of the announcement of the conclusion of the investigation.
The legislative history of section 1504(d) also supports the trial court's conclusion that suspension of liquidation was removed upon publication of the final results in the Federal Register. Before section 1504 was enacted, there was no statutory restriction on the length of time Customs could take to liquidate an entry. St. Paul Fire & Marine Ins. Co. v. United States, 6 F.3d 763, 767 (Fed.Cir.1993). "Customs could delay liquidation as long as it pleased, with or without giving notice." Int'l Cargo & Surety Ins. Co. v. United States, 779 F.Supp. 174, 177 (Ct. Int'l Trade 1991). In 1978, Congress enacted section 1504 to impose a four-year time limit for liquidation. The primary purpose of section 1504 was to "increase certainty in the customs process for importers, surety companies, and other third parties with a potential liability relating to a customs transaction." Dal-Tile Corp. v. United States, 829 F.Supp. 394, 399 (Ct. Int'l Trade 1993) (internal quotations and citation omitted).
In 1993, Congress amended section 1504(d). The amendment was designed in part to address an anomaly in the prior version of the statute, which made deemed liquidation available if suspension...
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