U.S. Customs and Border Protection (CBP) has issued “interim” regulations (81 Fed. Reg. 56477, August 22, 2016), effective immediately, under authority of the Trade Facilitation and Trade Enforcement Act of 2015 (specifically the provisions of the Enforce and Protect Act of 2015, or “EAPA”) to establish procedures for investigating claims of evasion of antidumping and countervailing duty orders. While U.S. Immigration and Customs Enforcement (ICE) has authority to conduct criminal investigations of ADD/CVD orders, and CBP has authority to assess civil penalties against importers for evasion, the new EAPA procedures afford private parties an opportunity to participate in investigations of ADD/CVD evasion.
Under the new investigative framework, CBP will have the authority to investigate allegations of ADD/CVD evasion that are filed by “interested parties” (or referred by another federal agency). Interested parties will receive notification of CBP’s initiation of the investigation, referrals to the U.S. Department of Commerce, and CBP’s determinations with respect to evasion, and may participate in the investigation and any administrative or judicial reviews of CBP’s determinations.
“Interested parties” who may file allegations of evasion (and “participate” in the investigation) include foreign manufacturers, producers, exporters or importers of the “covered merchandise,” domestic manufacturers, producers or wholesalers of a “like product,” as well as unions, groups of workers, and trade associations whose members manufacture, produce or wholesale a domestic like product. Allegations are to be filed electronically and must include, among other information, support of the allegation that the identified importer has engaged in evasion.
The EAPA and CBP’s regulations provide time frames for the initiation of investigations, the making of determinations, the communication of determinations to interested parties, and the initiation of interim enforcement action. Upon receipt of a properly filed allegation, CBP must make a determination within 15 days as to whether to initiate an investigation. Unless CBP makes a referral to the U.S. Department of Commerce, CBP must make a determination with respect to evasion within 300 days of the initiation (subject to extensions). In conducting its investigation, CBP may request information from interested parties, the importer alleged to have engaged in evasion, foreign producers and exporters, and the government of the country of exportation of the covered merchandise. While CBP will set forth the time for responses it its request, the 200th day after initiation of the investigation is the general deadline for information to be considered.
No later than 90 days after initiation, CBP will take “interim measures”, including suspending the liquidation of entries or extending suspension of liquidation of entries (and taking any necessary bond action) if it determines that there is “reasonable suspicion” that covered merchandise had been entered though evasion. Written arguments with respect to the alleged evasion and responses thereto by the “parties to the investigation” (the party who alleged evasion and the importer who allegedly engaged in evasion) may be submitted to CBP until 230 days after the initiation of the investigation.
Upon conclusion of the investigation, CBP will make a determination of evasion on the basis of “substantial evidence” and notify the parties to the investigation. Negative determinations will result in terminating any interim measures. Affirmative determinations will result in separate CBP action for liquidated entries of covered merchandise, and suspension or extension of liquidation of unliquidated entries (with continuation of the suspension or extension of liquidation of entries subject to interim measures), and CBP notification to the U.S. Department of Commerce.
Requests for administrative review of this “initial determination” may be made by either the party alleging evasion or the person determined to have entered merchandise through evasion, and are to be submitted to CBP’s Office of Regulations and Rulings. Parties to the investigation may submit responses to the request. The final administrative determination that results of CBP’s review are subject to judicial review by the U.S. Court of International Trade.
Information provided by: Steve Varnis - U.S. Customs Consulting - Cole International