Steel Importers Try for Section 232 Exclusions in CIT, Claim Wrong HTS Number Left No Recourse

Two steel importers, voestalpine USA and Bilstein Cold Rolled Steel, want refunds for Section 232 steel and aluminum duties paid on imports of alloy steel since the Commerce Department's Bureau of Industry and Security published a Section 232 exclusion with the wrong Harmonized Tariff Schedule code, they said in a June 18 complaint filed at the Court of International Trade. Voestalpine and Bilstein say the HTS error was only remedied after the imports had been liquidated and that no protest option was available to apply the exclusions after liquidation (voestalpine USA LLC et al. v. United States, CIT #21-00290).

Due to this lack of an opportunity to protest the liquidation, the plaintiffs filed their complaint under Section 1581(i), a residual CIT jurisdiction provision for trade cases, as opposed to Section 1581(a), the jurisdiction provision for challenges to denied protests. When BIS publishes an exclusion with an incorrect HTS code, the agency allows for a "resubmission" procedure, where an exclusion request "could be made applicable by a later exclusion with the correct classification number that was explicitly linked to the earlier exclusion request by BIS." There was no way to correct the original error, the plaintiffs said.

BIS published a second exclusion that remedied the HTS error, but some of the plaintiff's imports had already liquidated under the old exclusion with no means for recourse. "Plaintiffs had no option to correct the error in the HTSUS classification ... ," the complaint said. "BIS had the authority to correct this simple error long before but refused to do so, insisting instead on compliance with the extra-regulatory “resubmission” procedure. The Entries liquidated before the approved [second exclusion] could be applied to the Entries. BIS’s failure to correct the erroneous HTSUS classification number prevented Plaintiffs from obtaining refunds before liquidation."