# HQ 229330

March 12, 2002

## LIQ-4-01; LIQ-11

RR:CR:DR 229330 IDL

CATEGORY: Deemed Liquidation Determination

## Port Director of Customs

## Attn: Gail Douglas

## 40 S. Gay St.

## Room No. 205

## Baltimore, MD 21202

Re: Protest No. 1303-01-100081; 19 U.S.C. 1514; 19 U.S.C. 1504(d);
Antidumping Duties

Dear Ms. Douglas:

This is in response to your correspondence dated October 4, 2001,
concerning Travelers Casualty and Surety Company, Protest No.
1303-01-100081.

**FACTS:**

Travelers Casualty and Surety Company ("Travelers") protests liquidation
of two entries of bicycle speedometers manufactured by Asahi Keiki Mfg.
Co./Yagam Corporation of Japan ("Asahi/Yagam"), Entry No. 81-xxxx325,
entered on June 1, 1981, and Entry No. 81-xxxx743, entered on April 15,
1981. Customs suspended the subject entries, pending an antidumping
administrative review by the Department of Commerce ("Commerce"),
covering eleven manufacturers and/or exporters of Japanese bicycle
speedometers to the United States during the period of April 1, 1978
through October 31, 1984.

On July 31, 1987, Commerce published on Case A-588-038 (52 FR 28582),
[Preliminary Results of Antidumping Duty Administrative Review, Bicycle
Speedometers From Japan]{.underline}. Commerce preliminarily determined
the weighted-average dumping margin for Asahi/Yagam to be 6.15% on
merchandise entered between April 1, 1980 and October 31, 1981. On
November 4, 1987, Commerce published on Case A-588-038 (52 FR 42329),
[Bicycle Speedometers from Japan; Final Results of Antidumping Duty
Administrative Review]{.underline} ("Final Results"), again finding a
dumping margin of 6.15% for the applicable period.

On July 13, 2000, Commerce released via Message No. 0195201, liquidation
instructions to Customs for [Bicycle Speedometers from Japan
Manufactured and Exported by Asahi Keiki Mfg. Co./Yagam Corporation
(A-588-038-031)]{.underline}, 6.15% antidumping liability, covering the
period of November 1, 1978 through October 31, 1981. On August 25, 2000,
Customs liquidated both entries. On November 7, 2000, Customs mailed a
formal demand on surety to Travelers. The demand included the
corresponding bill numbers, importer number, billing location, document
dates, entry numbers, bill date, and amount due. On December 13, 2000,
Travelers filed Protest No. 1303-01-100081.

Travelers argues that Customs failed to liquidate the subject entries
until thirteen years after Commerce published the Final Results; that
the entries liquidated by operation of law under 19 U.S.C. 1504(d); in
the alternative, that such delay "constitutes an abuse of discretion" by
the "Government" and prejudice to the surety that merits remedy; that
Customs has failed to provide the surety with evidence of the basis of
its indebtedness; that the doctrine of "laches" precludes Customs from
collecting duties.

**ISSUES:**

\(1\) Whether Customs' liquidation of the subject entries on August 25,
2000 was barred by a prior liquidation by operation of law under 19
U.S.C. 1504(d)?

## 

\(2\) Whether Commerce's delay in releasing liquidation instructions to
Customs is protestable under 19 U.S.C. 1514?

\(3\) Whether Customs has provided the surety with evidence of the basis
of its indebtedness?

\(4\) Whether the doctrine of "laches" precludes Customs from collecting
duties?

**LAW AND ANALYSIS:**

Initially, we note that the protest was timely filed under the statutory
and regulatory provisions for protests (see 19 U.S.C. § 1514(c)(3)). The
date of mailing of Notice of Demand for Payment to the surety was
November 7, 2000, and Travelers filed protest on December 13, 2000, well
within the 90-day statutory time requirement under § 1514(c)(3).
Although the facts presented and issues raised involve questions of law
or fact which have been addressed by ORR, we will again address the
issues. (see 19 CFR Part 174).

Issue (1)

Whether Customs' liquidation of the subject entries on August 25, 2000
was barred by a prior liquidation by operation of law under 19 U.S.C.
1504(d)?

Generally, antidumping duty instructions applied by Customs are not
protestable. [Fujitsu Ten Corp. v. United States]{.underline}, Ct. Int'l
Trade, Slip Op. 97-11 (January 29, 1997). 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...at the time of liquidation." [HQ 228611]{.underline}; [HQ
225382]{.underline}; see also, [Mitsubishi Electronics America, Inc. v.
United States]{.underline}, 44 F. 3d 973 (Fed. Cir. 1994); [Nichimen
America, Inc. v. United States]{.underline}, 938 F. 2d 1286 (1991).
However, an importer may protest Customs' failure to follow a Commerce
instruction under 19 U.S.C. 1514. [American Hi-Fi International, Inc. v.
United States]{.underline}, 19 C.I.T. 1340 (1995).

Headquarters has issued numerous administrative decisions, proposing
that the date for lifting of the liquidation suspension is the date
Customs receives instructions from Commerce to liquidate the subject
entries. See [HQ 228660]{.underline}, April 6, 2001; [HQ
225783]{.underline}, January 16, 1996; [HQ 226285]{.underline}, October
10, 1997; [HQ 227793]{.underline}, November 4, 1998; and [HQ
227562]{.underline}, March 3, 1999. However, see also, [International
Trading Co. v. United States]{.underline}, 110 F. Supp. 2d 977; Slip Op.
00-83 (July 14, 2000), *appeal pending*, which interpreted 19 U.S.C.
1504(d). In that case, the court held that the direct communication from
Commerce to Customs in a form releasable to the public, that the
suspension of liquidation for the subject entries was removed following
the previous publication of final results in the Federal Register was
sufficient notice under section 1504(d) (1993) for the 6-month
liquidation period to run. That communication from Commerce did not
contain liquidation instructions to Customs to liquidate the subject
entries, such instructions followed later.

In this case, Commerce sent Customs liquidation instructions on Case
A-588-038 on July 13, 2000. The following month, on August 25, 2000,
Customs lifted the suspension of liquidation on the subject entries.
Therefore, the entries at issue were not deemed liquidated pursuant to
section 1504(d), as they were properly liquidated within six months of
Commerce's releasing of liquidation instructions to Customs.

Issue (2)

Whether Commerce's delay in releasing liquidation instructions to
Customs is protestable under 19 U.S.C. 1514?

Customs has the authority to grant or deny protestable decisions.
According to 19 U.S.C. 1514(a), these include, \"decisions of the
Customs Service, including the legality of all orders and findings
entering into the same, as to . . . (5) the liquidation or reliquidation
of an entry, or reconciliation as to the issues contained therein, or
any modification thereof.\" Concerning the role of Customs in
liquidating antidumping duties the court stated in [Mitsubishi
Electronics]{.underline}, supra, at page 977:

...Customs has a merely ministerial role in liquidating antidumping
duties under 19 U.S.C. 1514(a)(5). Customs cannot \"modify . . .
\[Commerce\'s\] determinations, their underlying facts, or their
enforcement.\" [Royal Business Machs., Inc. v. United
States]{.underline}, 507 F.Supp. 1007, 1014 n.18 (Ct. Int\'l Trade
1980), aff\'d, 669 F.2d 692 (CCPA 1982).

On July 13, 2000, Commerce ordered Customs to lift suspension of
liquidation of entries via Message No. 0195201. The following month, on
August 25, 2000, Customs liquidated the entries, well within the
six-month statutory requirement of section 1504(d).

Therefore, since Customs properly administered liquidation of the two
entries, this issue is not a protestable Customs matter under section
1514.

Issue (3)

Whether Customs has provided the surety with evidence of the basis of
its indebtedness?

Counsel argues that in [Old Republic Insurance Co. v. U.S.]{.underline},
10 C.I.T. 1; 625 F.Supp. 983 (1986), the court held that Customs is
under an obligation to provide some evidence of a surety's indebtedness
on a particular bond. Actually, the court was addressing notice to the
surety, which would enable it to file protest within the 90-day
statutory limitation of section 1514(c)(3). In this case, there is no
dispute that protestant has timely filed protest under section
1514(c)(3). The issue concerns sufficiency of information provided by
Customs enabling surety to identify and access records pertaining to the
bond.

Customs has provided Travelers with bill numbers, importer number,
billing location, document dates, entry numbers, port of entry, bill
date, and amount due. \[N\]otice to a surety for payment is not rendered
insufficient merely because the record-keeping practices of the surety
are inadequate. See [[Magee]{.underline} *v.* [Manhattan Life Ins.
Co]{.underline}*.*, 92 U.S. 93, 98
(1875](../../../../../../../../research/buttonTFLink%3F_m=d3efa116aaa3338a94fe7098a5439584&_xfercite=%3Ccite%20cc%3D%22USA%22%3E%3C%21%5BCDATA%5B12%20C.I.T.%201231%5D%5D%3E%3C%2Fcite%3E&_butType=3&_butStat=242&_butNum=5&_butInline=1&_butinfo=%3Ccite%20cc%3D%22USA%22%3E%3C%21%5BCDATA%5B92%20U.S.%2093%2CAT%2098%5D%5D%3E%3C%2Fcite%3E&_fmtstr=FULL&docnum=1&_startdoc=1&_startchk=1&wchp=dGLStk-lSllA&_md5=ae12e416524eeab082215c905f633c26))
(a surety \"must not rest supine, close his eyes, and fail to seek
important information within his reach\").

Customs is not required to attach a copy of the bond to its demand for
payment when Customs provides sufficient information for the surety to
locate the bond and ascertain its liability for payment. In the view of
the Court, any difficulties facing a surety in securing copies of its
import bonds or identifying its own agents can be overcome by requiring
that each broker or agent submit a copy of the bond to the surety upon
execution with the importer or filing with Customs. A prudent surety
would thus have a copy of all bonds under which it may be liable, which
could be examined immediately upon receiving a demand for payment....
[Peerless Insurance Co. v. United States]{.underline}, 12 C.I.T. 1231;
703 F. Supp. 104; 1988 Ct. Intl. Trade LEXIS 373; SLIP OP. 88-177
(December 30, 1988), *aff\'d*, [891 F.2d 298 (Fed. Cir.
1989)](../../../../../../../../research/buttonTFLink%3F_m=013d7055a0570589a9b3bd854ee956a1&_xfercite=%3Ccite%20cc%3D%22USA%22%3E%3C%21%5BCDATA%5B15%20C.I.T.%20279%5D%5D%3E%3C%2Fcite%3E&_butType=3&_butStat=242&_butNum=45&_butInline=1&_butinfo=%3Ccite%20cc%3D%22USA%22%3E%3C%21%5BCDATA%5B891%20F.2d%20298%5D%5D%3E%3C%2Fcite%3E&_fmtstr=FULL&docnum=1&_startdoc=1&_startchk=1&wchp=dGLStk-lSllA&_md5=71bf8a425c7fa2e2325b05533627c3be).

It remains the surety's obligation to maintain records of its bonds,
particularly those that are unliquidated or only recently liquidated.
Unlike [Old Republic]{.underline}, Customs has provided adequate
information in this case that would allow the surety to identify and
access records pertaining to the bond.

The information provided by Customs is sufficient evidence of surety's
indebtedness.

Issue (4)

Whether the doctrine of "laches" precludes Customs from collecting
duties?

Protestant contends that relief should be granted on the basis of
laches. The legal doctrine of laches precludes enforcement of a legal
right or claim if a long delay in asserting the right or claim has
prejudiced the adverse party. We note that laches is an equitable
doctrine (see, e.g., [A.C. Aukerman Co. v. R.L. Chaides Const.
Co.]{.underline}, 960 F. 2d 1020, 1030-1031 (Fed. Cir. 1992); [Robins
Island Preservation Fund v. Southold Dev.]{.underline}, 959 F. 2d 409,
423-424 (2nd Cir. 1992)). Equitable principles do not operate against
the Government in cases involving the collection or refund of duties on
imports ([Air-Sea Brokers, Inc. v. United States]{.underline}, 66 CCPA
64, 67-68, C.A.D. 1222, 596 F. 2d 1008 (1979); see also [Mitsubishi
Electronics America, Inc. v. United States]{.underline}, CIT Slip Op.
94-155, printed in the October 26, 1994, Customs Bulletin and Decisions,
Vol. 28, No. 43, p. 69). Since this is a case involving the collection
or refund of duties on imports, the doctrine of laches is not available
in this case. [HQ 224650]{.underline}.

Furthermore, any prejudice to the protestant would not have resulted
from a Customs decision, and, thus, would not be protestable under
section 1514 (see discussion in Issue (2)).

**HOLDING:**

The protest should be DENIED as to Issues (1), (2), (3), and (4) for the
reasons mentioned above. In accordance with Section 3A(11)(b) of Customs
Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest
Directive, you are to mail this decision, together with the Customs Form
19, to the Protestant no later than 60 days from the date of this
letter. Any reliquidation of the entry or entries in accordance with the
decision must be accomplished prior to mailing 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.ustreas.gov](http://www.customs.ustreas.gov/), by means of
the Freedom of Information Act, and other methods of public
distribution.

> Sincerely,
>
> John Durant
>
> Director,

Commercial Rulings Division