United States: CBP Extends Deadline For Public Comment: AD/CVD Evasion

Last Updated: November 22 2016
Article by Luis Torres

U.S. Customs and Border Protection ("CBP") published an interim final rule on August 22, 2016, in the Federal Register (See Investigation of Claims of Evasion of Antidumping and Countervailing Duties, 81 Fed. Reg. 56,477 (Aug. 22, 2016) ("Interim Rule"), concerning the investigation of antidumping ("AD") and countervailing duties ("CVD") evasion.  On October 21, 2016, CBP decided to extend the public comment period for an additional 60 days, or until December 20, 2016.   

The Interim Rule implements provisions of the newly enacted Trade Facilitation Act of 2015 ("TFTEA") which was signed into law by President Obama on February 24, 2016.  Title IV-Prevention of Evasion of Antidumping and Countervailing Duty Orders (short title "Enforce and Protect Act of 2015 or "EAPA") is a provision included within this Act which establishes a formal process for CBP to investigate allegations of the evasion of AD/CVD orders.   

Current regulations permit CBP to take enforcement actions against the evasion of AD/CVD orders, including the assessment of civil penalties against importers who evade such orders.   However, prior to the implementation of EAPA, private parties who submitted allegations as to evasion could not participate in the investigation process.  Accordingly, CBP had no obligation to inform the parties that submitted the allegations regarding the outcome of CBP's review.   

The new regulations permit private parties to make AD/CVD evasion allegations and participate in CBP's evasion investigations.  Consequently, CBP is now required to provide certain notifications and comply with new statutory deadlines for AD/CVD evasion investigations.

Under the Interim Rule, EAPA requires the Commissioner of CBP to initiate an investigation within 15 business days of receipt of a properly filed allegation from an interested party, or referral from another federal agency, that reasonably suggests that merchandise covered by an AD/CVD order has entered the customs territory of the United States through evasion.   Furthermore, when CBP receives an allegation, EAPA requires CBP to determine, not later than 300 calendar days (or 360 calendar days in extraordinarily complicated cases) after the date of the initiation of an EAPA investigation, whether there is substantial evidence that merchandise covered by an AC/CVD order was entered into the United States.  

The new regulations also authorize CBP to employ methods (as they may see appropriate) to collect such information as necessary to make the determination.  One of those methods specifically mentioned by the EAPA is the use of questionnaires.  CBP can send questionnaires to request information from the interested party making the allegation, the government of the foreign country from which the allegedly covered merchandise was exported, the importer, foreign producer, or exporter of the allegedly covered merchandise.   Additionally, CBP is required under EAPA to communicate its final determination to the interested party who made the allegation within five business days after making the determination.  

CBP must also determine within 90 calendar days of initiation of the investigation whether there is reasonable suspicion that covered goods were entered through evasion.  If that determination is affirmative, CBP will (1) suspend liquidation of unliquidated entries of covered goods entered after the date of initiation, (2) extend the period for liquidating unliquidated entries of covered goods that entered before initiation, and (3) take any additional measures necessary to protect the revenue (e.g., requiring a single transaction bond or additional security or the posting of cash deposits).

Once a determination has been made, EAPA provides a period of 30 business days for the interested party who made the allegation of evasion, or the person determined to have violated an AD/CVD order to request a de novo administrative review.  After such request, CBP has no more than 60 business days to complete its review and issue a final administrative determination. 

The Interim Rule will be subject to further comment and potential revisions before becoming final.  The new deadline for public comments is December 20, 2016. 

You may submit comments, identified by docket number, by one of the following methods:

  • Federal eRulemaking Portal: http:// www.regulations.gov. Follow the instructions for submitting comments via docket number USCBP–2016–0053.
  • Mail: Trade and Commercial Regulations Branch, Regulations and Rulings, Office of Trade, U.S. Customs and Border Protection, 90 K Street NE., 10th Floor, Washington, DC 20229– 1177.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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