The United States and many of its trading partners have established laws to remedy the unfair trade practices of other countries and foreign companies that cause injury to domestic industries. U.S. law authorizes the imposition of AD/CV duties to remedy these unfair trade practices, namely dumping (i.e., sales at less than normal value) and foreign government subsidies. The U.S. AD/CV duty system is retrospective, in that importers pay estimated AD/CV duties at the time of importation, but the final amount of duties is not determined until later. By contrast, other major U.S. trading partners have AD/CV duty systems that, although different from one another, are fundamentally prospective in that AD/CV duties assessed at the time a product enters the country are essentially treated as final. Two key U.S. agencies are involved in assessing and collecting AD/CV duties owed. The Department of Commerce (Commerce) is responsible for calculating the appropriate AD/CV duty rate, which it issues in an AD/CV duty order. Commerce typically determines two types of AD/CV duty rates in the course of an initial AD/CV duty investigation on a product: a rate applicable to a product associated with several specific manufacturers and exporters, as well as an “all others” rate for all other manufacturers and exporters of the product who were not individually investigated. After the initial AD/CV duty investigation, Commerce can often conduct two subsequent types of review: administrative and new shipper. Administrative review: One year after the initial rate is established, Commerce can also conduct a review to determine the actual, rather than estimated, level of dumping or subsidization. At the conclusion of the administrative review, the final duty rate, also known as the liquidation rate, is established for the product. New shipper review: After an initial rate is established, a new shipper (i.e., a shipper who has not previously exported the product to the United States during the initial period of investigation and is not affiliated with any exporter who exported the subject merchandise) who is subject to the “all others” rate can request that Commerce conduct a review to establish the shipper’s own individual AD/CV duty rate. U.S. Customs and Border Protection (CBP), part of the Department of Homeland Security, is responsible for collecting the AD/CV duties. The initial AD/CV duty order issued by Commerce instructs CBP to collect cash deposits at the time of importation on the products subject to the order. Once Commerce establishes a final duty rate, it communicates the rate to CBP through liquidation instructions, and CBP instructs staff at each port of entry to assess final duties on all relevant products (technically called liquidating). This may result in providing importers— who are responsible for paying all duties, taxes, and fees on products brought into the United States—with a refund or sending an additional bill. CBP is also responsible for setting the formula for establishing the bond amounts that importers must pay. To ensure payment of unforeseen obligations to the government, all importers are required to post a security, usually a general obligation bond, when they import products into the United States. This bond is an insurance policy protecting the U.S. government against revenue loss if an importer defaults on its financial obligations. In general, the importer is required to obtain a bond equal to 10 percent of the amount the importer was assessed in duties, taxes, and fees over the preceding year (or $50,000, whichever is greater). In addition, importers purchasing from the new shipper can pay estimated AD/CV duties by providing a bond in lieu of paying cash to cover the duties—an option known as the new shipper bonding privilege. We previously reported that over $613 million in AD/CV duties from fiscal years 2001 through 2007 went uncollected, with the uncollected duties highly concentrated among a few industries, products, countries of origin, and importers. Recent CBP data indicate that uncollected duties from fiscal year 2001 to 2010 have grown to over $1 billion and are still highly concentrated. For example, according to CBP, five products from China account for 84 percent of uncollected duties. CBP, Congress, and Commerce have undertaken several initiatives to address the problem of uncollected AD/CV duties. However, these initiatives have not resolved the problems associated with collections. In response to the problems of collecting AD/CV duties, in July 2004, CBP announced a revision to bonds covering certain imports subject to these duties, significantly increasing the value of bonds required of importers. CBP’s goal was to increase protection for securing AD/CV duty revenue for certain imports when the final amount of duties owed exceeds the amount paid at the time of importation, without imposing an “excessive burden” on importers. In February 2005, CBP applied this revision to imports of shrimp from six countries as a test case, which covered a potential increase in the final AD duty rate of up to 85 percent from the initial rate. However, shrimp importers reported that the costs were substantial because they had to pay up front higher premiums and larger collateral requirements to obtain the bonds for the initial duties. These increased up-front costs can deter malfeasance by illegitimate importers by increasing the cost of importing merchandise subject to AD/CV duties, but may also impose costs on legitimate importers that pose little risk of failing to pay retrospective AD/CV duties. The enhanced bonding requirement was subject to domestic and World Trade Organization (WTO) litigation, and CBP decided to terminate the requirement in April 2009. Congress partially addressed the risk that CBP would not be able to collect AD/CV duties from new shippers by suspending the new shipper bonding privilege from August 2006 to July 2009. As a result, importers purchasing from new shippers were required to post a cash deposit for estimated AD/CV duties, like all other importers. This requirement eliminated the risk of uncollected AD/CV revenues when the final duty amounts were assessed at the cash deposit rate or less because CBP did not have to issue a bill for the bonded amount. Upon the July 2009 expiration of the requirement, the new shipper bonding privilege was reinstated. The Treasury stated in a 2008 report to Congress that the added risk associated with the bond compared with the cash deposit is low. Commerce has taken steps to improve the transmission of liquidation instructions to CBP, which should improve CBP’s ability to liquidate AD/CV duties in a timely manner. Once Commerce determines the final AD/CV duty, it publishes a notice in the Federal Register, and CBP has 6 months to complete the liquidation process. If CBP fails to complete the liquidation process within 6 months, an entry is “deemed liquidated” at the rate asserted by the importer at the time of entry. Once an entry has been deemed liquidated, CBP cannot attempt to collect any supplemental additional duties that might have been owed because of an increase in the AD/CV duty rate from initial to final. Commerce’s liquidation instructions are necessary for CBP to assess and collect the appropriate amount of AD/CV duties in a timely manner. However, we reported in 2008 that there were frequent delays in Commerce’s transmission of liquidation instructions to CBP, and that about 80 percent of the time, Commerce failed to send liquidation instructions within its self-imposed 15-day deadline. In addition, we found that Commerce’s liquidation instructions were sometimes unclear, thereby causing CBP to take extra time to obtain clarification. In December 2007, after we made Commerce officials aware of the untimely liquidation instructions, Commerce announced a plan for tracking timeliness, including a quarterly reporting requirement. In April 2011 Commerce officials told us that Commerce had deployed a system for tracking Commerce’s liquidation instructions. In addition, Commerce and CBP established a mechanism for CBP port personnel to submit questions to Commerce regarding liquidation issues. The House and Senate Appropriations Committees directed us to examine whether international agreements to which the United States is a party could be strengthened to improve the collection of AD/CV duties from importers with no attachable assets in the United States. We reported in 2008 that U.S. agency officials believed this would be both difficult and ineffective because of two key obstacles: Few countries are willing to enter into negotiations, and U.S. and foreign governments have a practice of not enforcing a revenue claim based upon the revenue laws of another country. In addition, agency officials stated that strengthening international agreements would not substantially improve the collection of AD/CV duties, given the retrospective nature of the AD/CV duty system and the high cost of litigation. There are two key components of the U.S. AD/CV duty system that have not been addressed but could improve the collection of AD/CV duties: the retrospective nature of the system and the new shipper review process. In addition, Commerce and CBP are contemplating changes to the bonding process. One key component of the U.S. AD/CV duty system is its unique retrospective nature, which creates risks of uncollected duties both because of time lags and rate changes. As discussed earlier, importers pay the estimated amount of AD/CV duties when products enter the United States, but the final amount of duties owed is not determined until later. In 2008, we found that the average time elapsed between entry of goods and liquidation was more than 3 years. The long time lag between the initial entry of a product and the final assessment of duties heightens the risk that the government will be unable to collect the full amount owed, as importers may disappear, cease business operations, or declare bankruptcy. The final amount owed under the retrospective system of the United States can also be substantially more than the original estimate, putting revenue at risk.