CBP Looking at AD/CV Duty Evasion Allegations Involving Imported Wooden Cabinets

CNC Associates is being investigated after allegations of evasion of antidumping and countervailing duties required on imported wooden cabinets and vanities and components from China, CBP said in a May 5 notice. The investigation stems from allegations filed under the Enforce and Protect Act (EAPA) by MasterBrand Cabinets, an Indiana cabinetmaker, CBP said. The company alleged that CNC evaded AD/CV duties using transshipment through Malaysia. MasterBrand is represented by Wiley Rein lawyer Timothy Brightbill, who represents several EAPA allegers.

Wooden cabinets and vanities and components thereof (WCV) from China are subject to AD (A-570-106) and CVD (C-570-107) orders and MasterBrand alleged that the importer sent covered goods through Malaysia to avoid the duties. CNC is said to have claimed the goods were manufactured by Bagus Timber Sdn Bhd of Malaysia. MasterBrand provided CBP data showing that shipments from China of WCV classified in subheading 9403.40.9060 plummeted after the imposition of preliminary duties, while imports of WCV “from Malaysia increased by an enormous 37,623 percent from 2018 to 2019, and by an additional 1,897 percent in January through September 2020 compared to the same period in 2019.” MasterBrand also hired a foreign market researcher, who visited the listed address for the manufacturer and found an abandoned lot, CBP said. Efforts to find an operating factory owned by the manufacturer in Malaysia were also unsuccessful, it said.

Based on MasterBrand's allegations, CBP began an investigation and issued CF-28 requests for information in February this year, it said. The responsive entry documents from CNC “included a certificate of origin certified by the Chinese Chamber of Commerce and Industry in Klang, Malaysia,” CBP said. It's “unusual” that the “Chinese Chamber of Commerce made the certification to Malaysian origin,” CBP said. Two recent cargo exams of CNC imports also “resulted in the discovery of the failure to mark the WCV with the proper country of origin,” the agency said.

In addition to the evidence provided in the allegation, “both the CF-28 responses and the cargo exams cast doubt as to the country of origin of the merchandise,” the agency said. That is enough to elicit “reasonable suspicion” as to evasion, the agency said. As a result, CBP said it will impose interim measures on CNC's imports of WCV, including live entry requirements, rate adjustments and suspended liquidations for unliquidated entries under investigation.