CBP Disburses Rest of Byrd Funds Withheld due to Litigation

U.S. Customs and Border Protection announced that on March 12, 2012 it began distributing the portion of the Continued Dumping and Subsidy Offset Act of 2000 (CDSOA, commonly referred to as the Byrd Amendment) funds¹ that it did not disburse in April 2011 due to pending litigation. According to CBP, the distribution process will continue until each fiscal year from 2006 through 2010 has been completed. CBP states that, in the event that it does not ultimately prevail in the ongoing litigation, affected domestic producers may be required to return some or all of the funds they have received.

(In April 2011 CBP began distributing some withheld CDSOA funds in response to Court of Appeals for the Federal Circuit (CAFC) decisions holding that the Byrd Amendment was not unconstitutional, but CBP continued to withhold funds for plaintiffs whose litigation was still unresolved. See ITT’s Online Archives 11042709 for summary of CBP beginning distribution for some CDSOA funds in April 2011. See ITT’s Online Archives 11120839 for summary of Fiscal Year 2011 CDSOA annual report, and 12020204 for summary of an update to that annual report.)

CBP Began Withholding in 2008 in Response to Litigation

According to CBP, a significant amount of litigation has challenged various provisions of the CDSOA, most notably the definition of the term “affected domestic producer.” As a result, CBP withheld from distribution an amount corresponding to the pro-rata share of all domestic producers who filed complete and timely certifications starting in 2006.

Distribution Commences Despite Several Court Cases in Progress

CBP distributed a portion of the withheld funds to affected domestic producers in April 2011. At that time, several court cases challenging various provisions of the CDSOA were still unresolved. At the behest of the Court, CBP agreed to continue to withhold the plaintiff(s)’s alleged pro rata share of the funds, if any, then currently being withheld for fiscal years 2006 through 2010. CBP only agreed to withhold those funds until January 31, 2012 absent an order from the Court directing CBP to do otherwise.

Some of these court cases have been resolved while others continue through the courts. Nonetheless, CBP is now proceeding with distribution of the withheld funds to the affected domestic producers.

Updated Statements Sent, Distribution to Continue Until Each FY Completed

The distribution process began on March 12, 2012 and will continue until each fiscal year from 2006 through 2010 has been completed. Distributions will be processed separately for each fiscal year and, if applicable, updated CDSOA statements for each fiscal year will be issued to the most recent address on file.

The updated statement should replace any previous statement received for that fiscal year. The fiscal year of the CDSOA statement can be determined from the 2nd and 3rd digit of the claim numbers (i.e. I0612345 or E0612345 indicates fiscal year 2006). Annual reports will be updated on the website after the distributions for all fiscal years have been completed.

Domestic Producers Liable if Courts Reverse Course in Pending Litigation

CBP states that, as a number of the cases that initially led to the withholding of these funds are still ongoing, affected domestic producers remain on notice that they may be required to return some or all of the funds they have received if CBP does not ultimately prevail in the ongoing litigation. CBP considers the negotiation of these distribution checks as an acknowledgment of this obligation.

¹The Byrd Amendment requires that the revenues from antidumping/countervailing (AD/CV) duties assessed on or after October 1, 2000 be distributed on an annual basis to the affected domestic producers for specified qualifying expenditures. Although the Byrd Amendment has been repealed, all duties on entries of goods made and filed before October 1, 2007 will still be distributed.