HQ 221698: Application for further review of Protest No. 2704-5- 003921; antidumping duty order concerning sorbitol crystalline from France; 19 U.S.C. 1677g

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 221698

                           May 3, 1991

LIQ-4-01/LIQ-11-CO:R:C:E  221698 JR

CATEGORY:  Entry/Liquidation

Regional Director of Customs
Commercial Operations Division
Pacific Region
One World Trade Center, Suite 534
Long Beach, CA 90831-0700

RE:  Application for further review of Protest No. 2704-5-
     003921; antidumping duty order concerning sorbitol
     crystalline from France; 19 U.S.C. 1677g

Dear Madame:

     The above-referenced protest was forwarded to this office
for further review.  We have considered the issues raised and our
decision follows.

FACTS:

     The International Trade Commission (ITC) issued its final
affirmative antidumping determination on March 29, 1982, that an
industry in the United States is being materially injured by
reason of imports of sorbitol from France.  See 47 FR 14981,
April 7, 1982.  On April 9, 1982, the International Trade
Administration (ITA) issued its final antidumping order stating
that sales of sorbitol from France were less than the fair value. 
See 47 FR 15391-15392, April 9, 1982.  The ITA ordered that all
unappraised entries of this merchandise made on or after November
30, 1981 - the date from which final assessment of duty has been
suspended - will be liable for the possible assessment of
antidumping duties and a deposit of antidumping duties must be
made on all such entries made on or after April 9, 1982.

     This protest involves an entry made on an importation of
French sorbitol crystalline at the port of Los Angeles on May 3,
1982, with a deposit of both estimated tariff and antidumping
duties in accordance with the final order of the ITA.  The entry
was liquidated on June 14, 1985, with the refund of antidumping
duties, after the liquidation of the entry had been suspended. 
On July 30, 1985, the importer timely filed a protest under 19
U.S.C. 1514(a) against Customs' nonpayment of interest on the
refund of its overpayment of antidumping duties.  

     The importer/protestant contends that it is entitled to
interest on the refund of antidumping duties received on each
individual entry entered into the United States after the final
antidumping duty order of April 9, 1982, pursuant to Section 621
of the Trade and Tariff Act of 1984 (codified at 19 U.S.C.
1677g).  The protestant argues that the special liquidation notes
to CIE's Supplement CIE-N-63/81, Supplement No. 2, issued on
November 19, 1984, redesignated Supplement No. 3 on January 1,
1985, provides for interest on refunds of dumping duties
deposited after April 9, 1982.  Alternatively, interest should be
refunded at a rate of 11% compounded daily from the date of entry
to the date of liquidation.

     The district office's position is that Section 621 of the
Tariff and Trade Act (19 U.S.C. 1677g) is effective only for
"determinations" made on or after October 30, 1984, regardless of
the date of entry.  The district office believes that the payment
of interest on overpayments or underpayments under 19 U.S.C.
1677g is inapplicable to the entry in question since the
signature on the Final Results of the Administrative Review of
the Antidumping Duty Order is March 12, 1984 (see 49 FR 10695,
dated March 22, 1984), which is before the listed effective date
of 19 U.S.C. 1677g (October 30, 1984).  Alternatively, the
district asserts that the Tax Equity and Fiscal Responsibility
Act of 1982 does not provide for the compounding of interest on
antidumping or countervailing duties, but rather like interest
paid on such refunds based on judgments or agreements with the
Court of International Trade, should be computed on a simple
basis. 

ISSUE:

     Whether interest is payable on the refund of an overpayment
of estimated antidumping duties deposited prior to the amendment
of 19 U.S.C. 1677g?  If so, what rate of interest applies?

LAW AND ANALYSIS:

     Prior to the enactment of the Trade Agreements Act of 1979,
interest on underpayments or overpayments was not required by
law.  However, Section 778 of the Trade Agreements Act of 1979
(19 U.S.C. 1677g (1979) (hereafter "1979 Act"), provided that
interest is payable on any overpayments or underpayments of
estimated duties deposited on merchandise entered, or withdrawn
from warehouse, for consumption on and after the publication of
the final affirmative injury determination by the International
Trade Commission.  The 1979 Act set the interest rate at 8
percent per annum, or if higher, the rate in effect under section
6621 of title 26 on the date on which the rate or amount of the
duty is finally determined.  The interest was simple interest and
was to be determined at the rate in effect on the date of final
determination.

     Section 778 was subsequently amended by section 621 of the
Trade and Tariff Act of 1984 (hereafter "1984 amendment") to
provide that interest shall be payable on the amounts deposited
on merchandise entered, or withdrawn from warehouse, for
consumption on or after the date of publication of a
countervailing duty or antidumping duty order.  The 1984
amendment provides that interest was generally payable at the
rate in effect under 26 U.S.C. 6621.  By virtue of section 6622
of title 26, interest calculated under section 6621 must be
compounded.  Thus, this amendment provided that interest be
compounded and payable at the IRS rate for any period of time
during which the entries were suspended.  Pursuant to this method
the interest payable would vary in accordance with the interest
set forth under section 6621 for the periods of suspension.  This
amendment became effective on October 30, 1984.

     In 1986, Congress clarified the effective date of the 1984
amendment by indicating that the 1984 amendment should apply to
all entries unliquidated on or after November 4, 1984.  Section
1886(b) of the Tax Reform Act of 1986, Pub. L. No. 99-514.  The
Court of International Trade in Canadian Fur Trappers Corp. v.
United States, 691 F. Supp. 364 (CIT 1988), aff'd, 884 F.2d 563
(Fed. Cir. 1989) held that "the 1984 amendment cannot be applied
for interest accruing before the effective date of that
amendment."  Canadian Fur Trappers involved entries made before
the 1984 amendment, liquidated after October 30, 1984, but before
the 1986 amendment indicating that they should be liquidated in
accordance with the 1984 amendment.  Thus, pursuant to the
amendment, the entry in this case was made before this amendment
but was liquidated after the Act became effective.  Therefore,
the entry should be liquidated in accordance with the 1984
amendment, since the law in effect at the time the entry is
liquidated shall control.  See CIT Order, dated August 25, 1988,
Canadian Fur Trappers Corp. v. United States, Consolidated Court
No. 86-07-00977 (86-05-00641).  

     We disagree with the district's finding that 19 U.S.C.
1677g, as amended in 1984, does not control the entry.  At the
time of entry on May 3, 1982, there was a final antidumping duty
order by Commerce effective April 9, 1982.  In our view interest
would properly be assessed as of the date of entry rather than
March 12, 1984, the date of the Final Results of the
Administrative Review, as the district office asserts.  We reject
the protestant's argument that interest should be compounded from
the date of entry to the date of liquidation.  A combination of
interest calculation appears to be the appropriate course of
action in this case.  It is our position that the entry would be
subject to interest in accordance with the 1984 amendment, i.e.,
compound interest at the varying IRS rates on or after November
4, 1984, see 26 U.S.C. 6621, and the 1979 simple interest
provision is applicable for interest accruing prior to the
effective date of the 1984 Act from the date of entry.     

HOLDING:

     Interest is payable on the refund of an overpayment of
estimated antidumping duties deposited prior to the amendment of
19 U.S.C. 1677g, that is, first at the rate of simple interest in
accordance with the 1979 Act from the date of entry (May 3, 1982)
until November 4, 1984, the effective date of the 1984 amendment,
and subsequently, at the compounding rate of interest set forth
in the 1984 amendment until the date of liquidation (June 14,
1985).

     You are directed to allow the protest in part, as provided
in the decision.  A copy of this decision may be provided to the
protestant.

                               Sincerely,




                               John Durant, Director
                               Commercial Rulings Division