Despite Admitting It Liquidated at Wrong Rate, Importer Says CBP Unlawfully Refused Refunds

An importer said that CBP liquidated 227 of its entries at an incorrect 1.02% AD rather than at the proper de minimis rate, then denied its protests and refused refunds despite a correction from Commerce (PNS Clearance v. U.S., CIT #24-00044).

At the Court of International Trade on Feb. 14, quartz countertop importer PNS Clearance filed its complaint contesting CBP’s denial of all 46 of its protests against the liquidations.

Although PNS acted as the importer of record, it said, the countertops’ actual customer was M S International. M S International’s exporter, the Indian company Pokarna Engineered Stone Limited, received a zero percent AD rate after being a respondent in Commerce’s first administrative review of quartz surface products.

On Feb. 16, 2023, the department issued instructions to CBP to liquidate all entries exported by Pokarna at its de minimis rate. At the time of Commerce’s instructions, the entries in question had been suspended by judicial injunction, PMS said. Despite Commerce’s instructions, however, they were not liquidated, it said.

In April 2023, Commerce announced that the injunction had been lifted, but it still didn't tell CBP to liquidate PNS’s entries, it said. Then, on May 12, CBP liquidated the entries on its own at the all-others rate of 1.02%. PNS said it paid the required duties at that time, but began submitting protests to the agency, which it would continue to do over the next few months.

In September, PNS said it also reached out to Commerce “for clarifying instructions” that its entries should have been liquidated at the zero percent rate. The department confirmed to both PNS and CBP -- specifically, PNS said, to AD/CVD Policy and Programs director Alexander Amdur -- that “these liquidation instructions were forthcoming and that the entries in question should not have been liquidated.”

The department “issued the long-awaited instructions” in December clarifying that the May 12 liquidations should have been at the de minimis rate, PNS said, and also approving some of PNS’s protests.

However, in January, CBP announced that although the May 12 entries had been eligible for the zero percent AD rate, it still was denying PNS’s protests “because CBP was not able to revisit the protests it denied on August 21, 2023 and November 7, 2023 in light of these new instructions.”

“CBP’s denial of Plaintiffs’ protest was unlawful because the 227 entries of quartz surface products at issue fall squarely within the parameters of Commerce’s instructions [on Feb. 16],” PNS said. “Both Commerce and CBP have confirmed in various communications with Plaintiff and its counsel that this is the case. CBP thus has no legal or factual basis for having liquidated at the 1.02% all-others rate.”

It asked CIT to order that the excess duties it paid be refunded.