China Commerce Group Emphasizes Limits to CBP AD/CV Duty Evasion Investigations
Despite CBP's new investigatory authorities for antidumping or countervailing duty evasion allegations, the agency's role remains "ministerial" and it must still defer to the Commerce Department in many cases, the China Chamber of International Commerce said. "CBP must keep in mind that it is [Commerce] that determines the scope of antidumping and countervailing duty orders" and "CBP lacks the authority to interpret ambiguous scope language," it said. The CCOIC, represented by Alston & Bird, submitted the comments to CBP (here) as part of CBP's request for comments on its interim regulations implementing the Enforce and Protect Act (EAPA) provisions (see 1608190014).
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Evasion can only occur if its known whether the merchandise is within the scope of an order and what the amount of duties owed is, the CCOIC said. Therefore, in many cases, decisions on whether an import is covered will require a scope ruling, "as the courts have made clear that CBP may not make this decision," it said. "CBP should make clear that a difference of opinion as to whether or not merchandise is within scope" is not evasion. "Where such a legitimate difference of opinion exists, until [Commerce] begins a scope review or inquiry, imports of the merchandise are not subject to an Order," so no evasion can occur. The comments are dated Nov. 29 but were posted on Jan. 6. CBP received many comments on the issue, mostly from law firms and industry groups (see 1612270018, 1612200034, 1610170012, 1610240014, 1610260026 and 1611210009).
The final regulations should also address what happens if CBP refuses to refer a scope issue to Commerce, it said. CBP should include a "mechanism for an interested party to seek relief when CBP improperly refuses" to refer a scope issue to Commerce and suspends liquidation of entries when the scope is in dispute, the CCOIC said. CBP shouldn't be allowed to use adverse inferences that emerge in other CBP proceedings, it said. "It is improper for CBP to apply an adverse inference to a party in one investigation based on actions or activities in another investigation," the CCOIC said. A party to an investigation can introduce information from another investigation if it wants, but "it is not appropriate for CBP to make adverse inferences based on other investigations.”