Rule2024-04713
Investigation of Claims of Evasion of Antidumping and Countervailing Duties
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
March 18, 2024
Effective
April 17, 2024
Issuing agencies
Homeland Security DepartmentU.S. Customs and Border ProtectionTreasury Department
Abstract
This document adopts as final, with changes, interim amendments to the U.S. Customs and Border Protection (CBP) regulations that were published in the Federal Register on August 22, 2016, as CBP Dec. 16-11, which implemented procedures to investigate claims of evasion of antidumping and countervailing duty (AD/CVD) orders in accordance with section 421 of the Trade Facilitation and Trade Enforcement Act of 2015. This document also announces that CBP deployed a case management system in April 2021, which CBP and the public use for filing, tracking, and adjudicating allegations of evasion of AD/CVD orders.
Full Text
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<title>Federal Register, Volume 89 Issue 53 (Monday, March 18, 2024)</title>
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[Federal Register Volume 89, Number 53 (Monday, March 18, 2024)]
[Rules and Regulations]
[Pages 19239-19262]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-04713]
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DEPARTMENT OF HOMELAND SECURITY
U.S. Customs and Border Protection
DEPARTMENT OF THE TREASURY
19 CFR Part 165
[USCBP-2016-0053; CBP Dec. 24-04]
RIN 1515-AE10
Investigation of Claims of Evasion of Antidumping and
Countervailing Duties
AGENCY: U.S. Customs and Border Protection, Department of Homeland
Security; Department of the Treasury.
ACTION: Final rule.
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SUMMARY: This document adopts as final, with changes, interim
amendments to the U.S. Customs and Border Protection (CBP) regulations
that were published in the Federal Register on August 22, 2016, as CBP
Dec. 16-11, which implemented procedures to investigate claims of
evasion of antidumping and countervailing duty (AD/CVD) orders in
accordance with section 421 of the Trade Facilitation and Trade
Enforcement Act of 2015. This document also announces that CBP deployed
a case management system in April 2021, which CBP and the public use
for filing, tracking, and adjudicating allegations of evasion of AD/CVD
orders.
DATES: Effective on April 17, 2024.
FOR FURTHER INFORMATION CONTACT: Victoria Cho, Chief, EAPA
Investigations Branch, Office of Trade, U.S. Customs and Border
Protection, (202) 945-7900, or <a href="/cdn-cgi/l/email-protection#a6d0cfc5d2c9d4cfc788c5cec9e6c5c4d688c2ced588c1c9d0"><span class="__cf_email__" data-cfemail="1a6c73796e7568737b347972755a79786a347e7269347d756c">[email protected]</span></a>, or Kristina
Horgan, Supervisory International Trade Analyst, EAPA Investigations
Branch, Office of Trade, U.S. Customs and Border Protection, (202) 897-
9399, or <a href="/cdn-cgi/l/email-protection#b1dac3d8c2c5d8dfd09fd9dec3d6d0dff1d2d3c19fd5d9c29fd6dec7"><span class="__cf_email__" data-cfemail="78130a110b0c1116195610170a1f1916381b1a08561c100b561f170e">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
Table of Contents
I. Background
A. Enforce and Protect Act of 2015
B. Interim Final Rule
C. Operations
II. Discussion of Comments
A. Subpart A--General Provisions
B. Subpart B--Initiation of Investigations
C. Subpart C--Investigation Procedures
D. Subpart D--Administrative Review of Determinations
E. Other Comments
III. Technical Changes and Clarifications to the Interim Regulations
IV. Conclusion
V. Statutory and Regulatory Requirements
A. Executive Orders 13563 and 12866
B. Regulatory Flexibility Act
C. Paperwork Reduction Act
Signing Authority
List of Subjects
Amendments to the Regulations
I. Background
A. Enforce and Protect Act of 2015
On February 24, 2016, President Obama signed into law the Trade
Facilitation and Trade Enforcement Act of 2015 (TFTEA), which contains
Title IV--Prevention of Evasion of Antidumping and Countervailing Duty
Orders (short title ``Enforce and Protect Act of 2015'' or ``EAPA'')
(Pub. L. 114-125, 130 Stat. 122, 155 (Feb. 24, 2016) (19 U.S.C. 4301
note)). EAPA established a formal process for U.S. Customs and Border
Protection (CBP) to investigate allegations of evasion of antidumping
and countervailing duty (AD/CVD) orders. Section 421 of TFTEA amended
the Tariff Act of 1930 by establishing a new framework for CBP to
investigate allegations of evasion of AD/CVD orders, under newly
created section 517 (``Procedures for Investigating Claims of Evasion
of Antidumping and Countervailing Duty Orders''), and required that
regulations be prescribed as necessary, and provisions be implemented
within 180 days of TFTEA's enactment. See 19 U.S.C. 1517.
B. Interim Final Rule
On August 22, 2016, CBP published an interim final rule (the
``IFR'') (CBP Dec. 16-11) in the Federal Register (81 FR 56477),
setting forth procedures for the investigation of claims of evasion of
antidumping and countervailing duty orders in a new part 165 in title
19 of the Code of Federal Regulations (19 CFR part 165), with a 60-day
public comment period. The IFR became effective on August 22, 2016. On
September 8, 2016, CBP published a technical correction in the Federal
Register (81 FR 62004) to correct language in the definition of ``evade
or evasion'' in 19 CFR 165.1, by adding a comma that was inadvertently
omitted. On October 21, 2016, CBP published an extension of the comment
period in the
[[Page 19240]]
Federal Register (81 FR 72692), providing an additional 60 days for
interested persons to submit comments in response to the IFR in order
to have as much public participation as possible in the formulation of
the final rule.
Operations
The first EAPA allegation was submitted to CBP in September 2016,
approximately one month after the interim regulations became effective.
Between September 2016 and the end of fiscal year 2021, CBP's Trade
Remedy Law Enforcement Directorate (TRLED) has processed approximately
490 EAPA allegations and initiated 179 investigations; in addition, CBP
has processed 39 requests for administrative review and issued 19 final
administrative determinations.
In these past few years, CBP has gained considerable expertise
processing EAPA allegations and has continued to ensure that EAPA
proceedings are transparent and that all parties are afforded an
opportunity for full participation and engagement during the
investigation. To enhance convenience and provide further transparency,
on April 1, 2021, CBP deployed the EAPA Portal, an electronic case
management system for the filing, tracking, and adjudicating of EAPA
allegations, and maintaining an administrative record, in one
centralized location, which may be accessed on CBP's website at <a href="https://www.cbp.gov/trade/trade-enforcement/tftea/eapa">https://www.cbp.gov/trade/trade-enforcement/tftea/eapa</a> when clicking on the
field titled ``Filing an EAPA Allegation.'' \1\
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\1\ Trade users must submit an EAPA allegation through the EAPA
Portal. The EAPA Portal can be reached in two ways. First, through
the Trade Violation Reporting (TVR) system, also known as e-
Allegations, used for reporting various trade violations. Trade
users can access e-Allegations at <a href="https://eallegations.cbp.gov/s">https://eallegations.cbp.gov/s</a> and
submit an EAPA allegation by clicking on the field entitled ``Report
Enforce and Protect Act Violations.'' Second, trade users may also
access the EAPA Portal via the EAPA website at <a href="https://cbp.gov/trade/trade-enforcement/tftea/eapa">https://cbp.gov/trade/trade-enforcement/tftea/eapa</a> by clicking the field titled
``Filing an EAPA Allegation.'' To submit an EAPA allegation in the
EAPA Portal, trade users must create a CBP user account first, at
<a href="https://www.login.gov/create-an-account">https://www.login.gov/create-an-account</a>. As new technology becomes
available, CBP may replace the current process or utilize additional
methods for accepting EAPA allegations or requests for
investigations from Federal agencies.
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In the EAPA Portal, parties to the investigation may view decisions
and public administrative record documents (including public versions
of documents associated with the investigation), check the status of
the investigation, and submit factual information, written arguments,
and documents relevant to the investigation. The EAPA Portal also sends
notifications to the parties to the investigation with deadline
reminders and actions to be taken. In addition, when this final rule is
effective, an alleger will be able to withdraw an allegation and a
Federal agency will be able to withdraw a request for an investigation
(referral) in the EAPA Portal.\2\ With a new case management system in
place, and CBP's extensive experience with the current EAPA process,
CBP is now ready to finalize the interim regulations, with several
modifications as described below.
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\2\ Guidance for trade users regarding the EAPA Portal, and
additional resources, such as a quick reference guide and a recorded
demonstration on how to access and navigate within the EAPA Portal,
can be found on CBP's website at <a href="https://www.cbp.gov/trade/trade-enforcement/tftea/eapa">https://www.cbp.gov/trade/trade-enforcement/tftea/eapa</a> when clicking on the field titled ``Filing an
EAPA Allegation'' at the bottom of the page.
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II. Discussion of Comments
Although the interim regulatory amendments were promulgated without
prior public notice and comment procedures pursuant to the agency
organization, procedure, and practice exemption in 5 U.S.C. 553(b)(A),
the IFR provided for the submission of public comments that would be
considered by CBP before adopting the interim amendments as final. The
60-day public comment period was set to end on October 21, 2016, but
was extended that day for an additional 60 days. The extended comment
period closed on December 20, 2016.
CBP received 17 submissions in response to the publication of the
interim regulations, each of them including comments on multiple
topics. The comments involved various aspects of the EAPA process, from
the initiation of an investigation to the administrative review of a
determination as to evasion. CBP reviewed all public comments received
in response to the interim final rule and made some changes to the
interim regulations based on those comments. In addition, CBP has
included some clarifications where needed to ensure a transparent
investigation process. A description of the public comments received,
along with CBP's analysis, are set forth below. The comments and
responses have been grouped together by subpart of the EAPA
regulations, where appropriate.
General Provisions (Subpart A)
Subpart A (General Provisions) provides definitions of terms
relevant to the EAPA process, specifies the entries that may be the
subject of an allegation, identifies when a power of attorney is
required, and addresses the submission of business confidential
information. This subpart further sets forth the means by which CBP may
obtain information for EAPA proceedings, addresses the circumstances
when CBP may apply adverse inferences in an EAPA investigation and in
an administrative review, and details the reporting responsibilities in
case of public health and safety issues associated with an
investigation. Multiple comments were received regarding subpart A,
dealing with questions on the various definitions in Sec. 165.1, and
the submission requirements in Sec. Sec. 165.3 and 165.5. Some
commenters requested clarification on certain aspects of the
application of adverse inferences in case of a party's failure to
comply with CBP's request for information.
Comment: Multiple commenters stated that CBP should not require the
identification of an importer as a condition for initiation of an
investigation. The commenters noted that Congress did not require the
identification of an importer of record and that by doing so, CBP could
be encouraging the proliferation of shell or paper companies to act as
importers. The commenters further stated that TFTEA instructed CBP to
investigate any allegation that reasonably suggests that covered
merchandise has been entered into the customs territory of the United
States through evasion. Therefore, the commenters suggest that CBP
should remove the phrase ``by an importer'' in Sec. 165.1 in the
``allegation'' definition, and, for the same reason, remove references
to the identification of an importer in various sections of part 165,
such as Sec. Sec. 165.4(c)(3), 165.11(b)(3) and 165.14(b)(1). One
commenter referenced the Trade Secrets Act (18 U.S.C. 1905) and the
statute's goal to bar against unauthorized disclosure by government
officials of confidential information received in the course of their
employment or official duties, which could include the identity of an
importer. The commenter argued that CBP may protect the identity of an
importer without having to narrow the scope of the investigation by
simply not requiring the specific identification of an importer of
record in an allegation.
Response: CBP disagrees with the commenters' suggestion to remove
language in the regulations that requires that an alleger provide the
identity of the importer against whom an allegation is filed. The text
of 19 U.S.C. 1517(b)(2) refers to ``. . . an allegation that a person
has entered covered merchandise . . .'' (emphasis added), which
requires the specific identification of an importer. Removing the
reference to ``a person,'' i.e., an importer, in the regulations, would
require a statutory change prior to making a change in the regulation.
[[Page 19241]]
Furthermore, CBP considers the requirements in the regulations to be
consistent with the Trade Secrets Act. While the Trade Secrets Act
protects against the unauthorized disclosure of confidential
information, CBP does not consider the identity of the importer to be
confidential. In fact, Sec. 165.4(c)(3) specifically states that the
name and address of an importer against whom the allegation is brought
is not protected as business confidential information.
Comment: One commenter requested that an illustrative list of
examples of evasion schemes be included in the definition of ``evade or
evasion'' in Sec. 165.1.
Response: CBP agrees with the commenter that it would be helpful to
add some examples of evasion to the definition, such as the
transshipment, misclassification and/or undervaluation of covered
merchandise. Accordingly, CBP has added such language at the end of the
definition of ``evade or evasion'' in Sec. 165.1.
Comment: One commenter expressed concern that the EAPA provisions
would be misused by domestic interested parties or competitors in an
effort to disrupt the supply chains of foreign producers and U.S.
importers. Another commenter raised the concern that the EAPA
provisions have the potential to brand innocent importers as evaders of
the law, regardless of their good faith efforts to comply with AD/CVD
orders.
Response: While CBP understands these concerns, CBP carefully
investigates and reviews the evidence, in accordance with all
applicable legal requirements, at each stage of the process before
making a determination as to evasion.
Comment: Multiple commenters asked CBP to expand the list of
interested parties who are allowed to participate in EAPA
investigations. The commenters argued that the limitation in the
interim regulations deprives CBP of the resources, experience, and
insights from other domestic producers or importers, especially in
cases when Federal agencies request an investigation, such that the
domestic industry affected by the evasion would have no right to
provide information or otherwise participate in the investigation. One
of the commenters suggested to amend the regulation to include in an
EAPA investigation, whether initiated pursuant to the filing of an
allegation by an interested party or pursuant to a request by a Federal
agency, ``any other party meeting the definition of ``interested
party'' in Sec. 165.1 that submits an entry of appearance to CBP in a
timely fashion,'' in addition to the interested party who filed an
allegation and the importer who allegedly engaged in evasion. Two other
commenters stated that CBP should expand the regulatory definition of
``interested party'' to align with the broader statutory definition of
the ``United States importer'' in section 517(a)(6)(A)(i) of the Tariff
Act of 1930.
Response: CBP disagrees with the commenters' requests to expand the
list of interested parties who are allowed to participate in EAPA
investigations. The primary focus of CBP's determination in an EAPA
investigation is narrow, i.e., whether evasion, as defined by 19 U.S.C.
1517(a)(5), occurred or not. CBP's current EAPA process does not allow
for interested parties other than the alleger to participate during the
first 90 days of an investigation.
Moreover, the regulatory definition of the term ``interested
party'' aligns with the statutory definition. See 19 U.S.C.
1517(a)(6)(A) and 19 CFR 165.1. Both provisions allow for interested
parties to participate in an investigation by filing an allegation. The
statutory definition for ``interested party'' includes, inter alia, the
United States importer of covered merchandise. The regulatory
definition of an ``interested party'' in Sec. 165.1, which is not
limited to importers of record, but includes any importer of covered
merchandise, including the party against whom the allegation is
brought, is consistent with the statutory definition.
Comment: One commenter suggested to limit the definition of the
term ``importer'' to an importer of record of covered merchandise and
amend the definition of ``interested party'' in Sec. 165.1
accordingly. The commenter argued that CBP did not provide any reason
for expanding the definition beyond the importer of record, and thus
only the alleger and alleged evader should be included in the
definition.
Response: CBP disagrees with the commenter's definition of
``importer.'' In current practice, allegations are usually made against
importers of record of covered merchandise, in accordance with the
statute. However, CBP has defined the term ``importer'' by regulation
in 19 CFR 101.1 as the importer of record, the consignee, the actual
owner of the merchandise, or the transferee of the merchandise, and CBP
may initiate investigations against such parties if an allegation
reasonably suggests that evasion is occurring.
Comment: Multiple commenters asked for clarification of the
interaction of the evasion provisions with the penalties provision
(section 592 of the Tariff Act of 1930, as amended (19 U.S.C. 1592)),
the impact of a prior disclosure pursuant to section 592(c)(4) on an
EAPA investigation, and identification of appropriate cases involving
AD/CVD orders where penalties would be contemplated and potentially
assessed. One of the commenters opined that an EAPA investigation is
not a section 592 investigation and cannot lead to a section 592
penalties matter; thus, the investigation definition in Sec. 165.1
should be deleted. Another commenter suggested that CBP clarify in
Sec. 165.28(a) that CBP is not required to initiate any other actions,
including a section 592 proceeding. Lastly, a commenter asked for the
revision of Sec. 165.11 to expressly provide that the filing of an
evasion allegation operates as a ``formal investigation'' to preclude
the acceptance of a prior disclosure, with regard to the same set of
facts, importer(s), entries and AD/CVD orders, under 19 U.S.C. 1592.
Response: CBP welcomes the opportunity to provide some
clarification in response to the comments received on the interaction
between an EAPA investigation and section 592 actions, as well as the
impact of a prior disclosure on an EAPA investigation. An importer may
be precluded from filing a prior disclosure for violations discovered
during the course of an EAPA investigation but may not be precluded
from filing a prior disclosure for violations discovered outside of the
course of the EAPA investigation. The determination of whether a prior
disclosure is accepted requires a fact-specific assessment as to the
importer(s), entries and AD/CVD order(s) involved. In addition, CBP
disagrees with the commenter's request for a regulatory change to the
``investigation'' definition in Sec. 165.1 as the definition is
accurate and should not be removed. CBP retains the discretion to
accept or reject a prior disclosure for any facts that were not
discovered during the course of an EAPA investigation.
Further, CBP does not agree with the amendment of Sec. 165.28(a),
as one of the commenters suggested. CBP appreciates the opportunity to
clarify that CBP is not required to initiate any other actions,
including section 592 proceedings. If CBP finds that entries are
already liquidated when an affirmative determination as to evasion is
made, then CBP's recourse to recover the lost duties is to initiate a
section 592 proceeding or any other appropriate action separate from
the EAPA proceeding. If TRLED makes an affirmative determination of
evasion, pursuant to Sec. 165.27, a Center of Excellence and Expertise
(Center) will
[[Page 19242]]
be directed to collect cash deposits and take other enforcement actions
as necessary. TRLED may also refer the case to other components within
CBP and partner government agencies (PGAs) to review the facts and
perhaps assess a penalty, depending on the circumstances.
Finally, CBP disagrees with the last commenter, that an EAPA
investigation operates as a formal investigation and precludes prior
disclosure under 19 U.S.C. 1592. The importer who is alleged to have
engaged in evasion will have the burden to show that it is not aware of
an ongoing investigation. If the importer is able to do so, and meets
all other relevant criteria, then the importer may have the opportunity
to file a prior disclosure with CBP.
Comment: Multiple commenters stated that the one-year threshold for
entries that may be the subject of an allegation is too narrow as it
severely restricts the allegations that can be pursued, and thus should
be eliminated. One of the commenters argued that there is no statutory
support for this limitation. Another commenter suggested the
application of a statute of limitations (SOL) that is consistent with
the SOL for violations of section 592 of the Tariff Act of 1930, as
amended, in order to provide interested parties with sufficient time to
uncover evasion and prepare an allegation. See 19 U.S.C. 1621. Finally,
one commenter expressed support for the regulation and claimed that
only entries made within one year before receipt of an allegation may
be the subject of an allegation.
Response: CBP appreciates the comments but disagrees that CBP is
limited to investigating entries of merchandise made within one year
before the receipt of an allegation. As stated in the preamble of the
IFR, CBP deemed a one-year period for an EAPA investigation appropriate
as it would allow for a timely determination using current and readily
available information, and prevent situations where CBP would encounter
entries that were already liquidated, or importers that are no longer
active. See 81 FR 56477, at 56479. Notwithstanding the above, the
regulations provide CBP with the discretion to investigate other
entries of such covered merchandise, and CBP will exercise such
authority on a case-by-case basis. See 19 CFR 165.2.
Comment: One commenter stated that Sec. 165.3 does not specify
what action CBP will take if the required proof of execution of a power
of attorney is missing.
Response: CBP agrees with the commenter's statement and,
accordingly, has added a new paragraph (f) in Sec. 165.3, clarifying
that CBP will reject any submission, and not consider or place such
submission on the administrative record, if a party has not provided
proof of execution of a power of attorney to CBP, as required pursuant
to the first sentence of paragraph (e) of Sec. 165.3, within five
business days of an interested party's first submission during an
investigation or administrative review. CBP further added language in
the new paragraph (f), that CBP will reject any submission, and not
consider or place such submission on the administrative record, if a
party has not provided proof of authority to execute a power of
attorney pursuant to paragraph (c) of Sec. 165.3 upon CBP's request.
Comment: One commenter stated that CBP did not specify what action
it may take if a submission fails to meet the form requirements of
Sec. 165.5(b)(1), and thus proposed to add a paragraph (b)(4) to
include the rejection of a submission as a consequence for failure to
meet those requirements.
Response: CBP welcomes the opportunity to clarify that CBP will
reject a submission that does not fulfill the form requirements of
Sec. 165.5(b)(1), and will not consider or place it on the
administrative record. Accordingly, CBP added a new paragraph (b)(4) in
Sec. 165.5 to reflect this clarification. For the same reasons, CBP
amended Sec. 165.41(f) to clarify that CBP will reject a request for
administrative review if the content requirements in paragraph (f) are
not met.
Comment: One commenter stated that it is unclear whether the person
making a submission pursuant to Sec. 165.5(b)(2) can be the authorized
representative of the party, the party itself, or both. The commenter
stated that the final regulation should clarify who needs to sign each
type of certification.
Response: CBP disagrees with the commenter's statement. The interim
regulation is clear as it reads ``on behalf of,'' allowing for an
authorized representative, such as an attorney, in addition to the
party itself to make the certification. Moreover, this has not been an
issue in practice.
Comment: One commenter expressed concern that adverse inferences
may be imposed on a party if an importer complies with CBP's request,
but the foreign supplier does not. The commenter requested
clarification as to whether evasion could be found in the described
scenario with regard to the foreign supplier, but not the importer, and
what such a finding would mean in terms of the application of duties or
other measures. Another commenter expressed a similar concern and asked
for Sec. 165.5 to be amended to include a requirement that CBP notify
the importer whenever CBP issues a questionnaire to a foreign supplier
to give the importer the opportunity to leverage its relationship with
the supplier to obtain the supplier's full cooperation and avoid
adverse inferences.
Response: A determination of evasion is based on an analysis of the
record, including responses to requests for information by both the
U.S. importer and foreign manufacturer. The scenario where one party
cooperates to the best of its ability, and another does not, creates a
difficult situation for CBP to conduct its analysis, and thus evasion
could still be found, depending on the available information. CBP
evaluates carefully on a case-by-case basis and may apply adverse
inferences as to the party not acting to the best of its ability to
cooperate with the investigation, in accordance with 19 U.S.C.
1517(c)(3)(B). The consequences, if any, that flow from such a finding
will vary on a case-by-case basis. With regard to the suggestion to
include a notification requirement in Sec. 165.5, CBP provides the
public versions of all documents, including questionnaires, to all
parties to the investigation and does not believe that any additional
notifications are necessary.
Comment: Two commenters noted that the use of a party's behavior in
a prior proceeding should not be an indicator for whether to apply
adverse inferences in the current proceeding, as stated in Sec.
165.6(b), arguing that only the party's behavior in the current
proceeding should be relevant for adverse inferences. Another commenter
asked CBP to amend paragraph (b) to clarify the distinction between the
intent of paragraph (a) and paragraph (b) by stating that CBP may
select from facts otherwise available, including information from a
prior determination in another CBP investigation, when applying adverse
inferences under paragraph (a).
One of the commenters also stated that the way paragraph (c) of
Sec. 165.6 is written, it unfairly applies adverse inferences even if
the information sought is already on the record. According to the
commenter, it should be irrelevant which party provided the information
as long as the information was provided to CBP.
Response: CBP disagrees; section 165.6, as written, accurately
reflects the statutory language. Both the statute and the regulation
distinguish between adverse inferences to be applied when a party fails
to cooperate and comply with CBP's request for more information
[[Page 19243]]
in the current proceeding (Sec. 165.6(a) and section 412(b)(1)(A) of
TFTEA), and adverse inferences to be applied based on a prior
determination in another CBP proceeding, or any other available
information (Sec. 165.6(b) and section 412(b)(2)(B) and (C) of TFTEA).
However, to be clearer and avoid any confusion, CBP has revised Sec.
165.6(b) so the regulatory language more closely resembles the
statutory language in section 412(b)(2) of TFTEA, without making any
changes to the substance of the language. In addition, CBP further
amended Sec. 165.6(b) to clarify that CBP may only consider ``any
other available information'' that has been placed on the
administrative record for purposes of applying adverse inferences.
CBP believes that when it comes to adverse inferences, the
determination to be made is whether the party from whom CBP requested
information provided the information. The fact that another party had
already provided information to CBP does not relieve the party of its
obligation to provide the requested information, as the other party's
submission may have been incorrect or incomplete. Lastly, as to the
commenter's unfairness argument, the regulations allow for due process
via administrative review by CBP and judicial review by the U.S. Court
of International Trade (CIT) in case an interested party believes that
adverse inferences were inappropriately applied.
Comment: One commenter talked about instances where CBP requests
information from a foreign government and receives no response, and
stated that, in such situations, CBP would need to examine the facts
available on the record to determine how to address the failure to
respond, and reach a determination based on those facts available.
Response: CBP agrees as 19 U.S.C. 1517(c)(2)(a)(iv) and (c)(3)
clearly state that CBP cannot apply adverse inferences as a result of
failure of a foreign government to respond to a CBP information
request. CBP will make a determination based on the facts available on
the administrative record, which may include, among other things,
adverse inferences made against other interested parties.
Comment: One commenter stated that the ``to the best of its
ability'' standard in Sec. 165.6(a) is vague and lacks a definition.
The commenter argued that it is unclear as to what level of cooperation
with CBP's information request is acceptable and what level is
insufficient, making the regulatory language unfair.
Response: CBP disagrees with the commenter's statement. CBP ensures
that the request procedure is transparent to those parties involved in
an EAPA investigation by providing all documents on the administrative
record. Further, the parties to the investigation, which include the
party filing the allegation and the importer, and the foreign producer
or exporter of the covered merchandise, are given sufficient time
during an EAPA investigation to gather and provide the requested
information to CBP. CBP then carefully evaluates the information on a
case-by-case basis to determine whether the party cooperated and
complied with CBP's request to the best of its ability and takes into
account the specific circumstances surrounding each request before
deciding whether adverse inferences are appropriate. The regulations
also provide for due process in the form of administrative review and
judicial review in cases where the importer is of the opinion that the
``to the best of its ability'' standard was met, but CBP nonetheless
applied adverse inferences.
B. Initiation of Investigations (Subpart B)
Subpart B (Initiation of Investigations) deals with the initiation
of an investigation, such as the filing of an allegation by an
interested party or a request for investigation (referral) by another
Federal agency, specifies the date of receipt of an allegation, and
discusses the consolidation of allegations, as well as referrals to the
Department of Commerce (Commerce) to determine whether merchandise
described in the allegation is properly within the scope of an AD/CVD
order. Commenters submitted questions on the availability of technical
assistance and guidance for small businesses and requested additional
methods for withdrawal of allegations and requests from Federal
agencies. CBP also received several comments surrounding the process of
the consolidation of allegations, and CBP's notification procedures.
Lastly, commenters asked for additional information about the timing of
CBP's scope referral and Commerce's scope proceeding.
Comment: While one commenter supported the requirement in Sec.
165.11(e) for CBP to provide technical assistance and guidance to small
businesses, another commenter was concerned with the provision and
stated that CBP should not assist small businesses with the preparation
and filing of an allegation. The commenter argued that it should be the
filing party's responsibility to meet the filing requirements in order
to maintain a fair and transparent investigation.
Response: CBP appreciates the comments. Small businesses are
entitled to technical assistance, upon request, from CBP if they
satisfy the applicable standards set forth in 15 U.S.C. 632 and 13 CFR
part 121. CBP notes that section 411(b)(4)(E) of TFTEA requires the
provision of technical assistance and advice to eligible small
businesses to prepare and submit an allegation. Furthermore, CBP
encourages filings by small and medium businesses and continues to
provide technical assistance to those businesses upon request.
Comment: One commenter suggested that CBP include a paragraph (f)
in Sec. 165.11, limiting communications with CBP to the parties to the
investigation. The commenter asked CBP not to publicize the filing of
an allegation or accept or respond to any unsolicited oral
communication concerning the allegation or investigation from any
person other than from a party to the investigation prior to a
determination to not initiate an investigation under Sec. 165.15, or a
determination as to evasion under Sec. 165.27(a).
Response: CBP disagrees with the commenter's request to include a
paragraph (f) in Sec. 165.11 that would limit communications to the
parties to the investigation. CBP believes that the notice of
initiation of an investigation, which includes facts and evidence from
the submitted allegation, is the best time at which to notify all
parties to the investigation, as well as the public, in an effort to
make the EAPA proceedings as transparent as possible. If, and when,
unsolicited information is submitted to CBP regarding an allegation or
investigation, CBP has the discretion to decide, throughout the
investigation, if it will place this information on the administrative
record or not (including prior to the notice of initiation of an
investigation).
Comment: Multiple commenters disagreed with the term ``date of
receipt'' in Sec. 165.12(a). The commenters argued that the overall
intent of TFTEA is for CBP to proceed swiftly and adhere to strict
deadlines, but claimed that the way the interim regulation is written,
the date of receipt is entirely within CBP's control, and thus the
regulatory language runs counter to the statutory language that states
unambiguously that not later than 15 business days after receiving an
allegation, CBP shall initiate an investigation. See 19 U.S.C.
1517(b)(1). For the same reasons, additional commenters requested that
CBP specify the exact number of days within which CBP is required to
issue
[[Page 19244]]
an acknowledgment of receipt, one of the suggestions being that the
deadline is no later than two days after receipt of the allegation.
Response: CBP disagrees with the commenters' request to redefine
the term ``date of receipt'' and specify an exact number of days within
which CBP issues an acknowledgment of receipt of an allegation. It is
clearly stated in the regulation that an allegation is received when
CBP acknowledges a properly filed allegation. An allegation cannot be
considered to be received until it is properly filed, i.e., the
allegation contains all the information and certifications required
pursuant to Sec. 165.11. The statute and interim regulations provide
CBP the flexibility to properly examine the allegations as resources
allow. Initiating an investigation within 15 business days of an
allegation being in CBP's possession could lead to an inefficient use
of CBP's resources, as poorly filed allegations or incomplete
allegations would cause CBP to perform work that should have been done
by the alleger.
Comment: One commenter called attention to a scenario that could
arise in the context of an interaction between Sec. 165.12 (date of
receipt of an allegation) and Sec. 165.2 (entries dating back to one
year before receipt of an allegation). The commenter stated that,
depending on the time of receipt of the allegation by CBP pursuant to
Sec. 165.12, the time period for investigating entries made within one
year prior to CBP's receipt of the allegation could become shorter
unintentionally if CBP takes time to acknowledge the receipt of the
allegation, and thus entries of allegedly covered merchandise could
potentially end up outside of the one-year period from the date of
receipt, as specified in Sec. 165.2.
Response: CBP disagrees that the regulation should be changed to
cover entries made within one year before the original date of
submission of the allegation, instead of the date of receipt of the
allegation. CBP acknowledges that the scenario described above could
make it difficult in certain instances to cover the alleged actions in
the time frame set forth in Sec. 165.2. However, as mentioned above in
response to another comment, it is in CBP's discretion to investigate
other entries of covered merchandise, i.e., entries outside of the one-
year time frame, if the circumstances warrant.
Comment: One commenter stated that CBP should amend Sec. 165.12(b)
to provide for consequences for withdrawing an allegation, such as
prohibiting re-submission of a new allegation for a specified time
period after withdrawal. In addition, the commenter stated that there
should be consequences for providing false allegations.
Response: CBP disagrees with the commenter that consequences should
be tied to a withdrawal of an allegation. CBP further notes that
consequences for making false statements in EAPA investigations are
provided for in Sec. 165.5(b)(3).
Comment: One commenter asked CBP to amend Sec. 165.12(b) and Sec.
165.14(a) to allow for the withdrawal of a submission through any other
method approved or designated by CBP, in addition to email, to make
these provisions consistent with other provisions, such as Sec.
165.5(b)(1) and Sec. 165.11(a).
Response: CBP agrees with the commenter. One of the new
functionalities of the EAPA Portal is the ability for parties to submit
withdrawal requests through this system as a method approved or
designated by CBP. Accordingly, CBP has amended the language in
Sec. Sec. 165.12(b) and 165.14(a) to allow for additional methods for
the submission of withdrawal requests. As mentioned above, this
functionality will be available in the EAPA Portal upon effectiveness
of this final rule.
Comment: One commenter asked CBP to consolidate allegations prior
to the initiation of an investigation, noting that the ``reasonably
suggests'' standard in Sec. 165.15(b)(2) is met in a case where
multiple importers are contributing to an evasion scheme, but each
importer-specific allegation may present, on its own, insufficient
information to satisfy the initiation standard. The commenter stated
that it would be imperative under those circumstances for CBP to
consider and consolidate the multiple allegations to meet the
``reasonably suggests'' standard.
Response: Under Sec. 165.13(a), CBP has the authority to
consolidate allegations at any point prior to the issuance of a
determination (even prior to the initiation of an investigation) and
may do so if certain criteria set forth in Sec. 165.13(b) are met.
Comment: One commenter suggested that CBP modify its regulations to
grant the parties to the investigation an opportunity to comment on (or
object to) consolidation prior to any decision to consolidate. The
commenter argued that such a regulatory change would promote engagement
with the parties as to why or why not consolidation would be beneficial
or burdensome.
Response: CBP disagrees with the commenter's suggestion to modify
the regulatory language. The interim regulations already include the
ability for comments to be placed on the administrative record
regarding consolidation of allegations once interim measures are
announced. Pursuant to Sec. 165.23(c), the parties to the
investigation have the opportunity to submit factual information up to
day 200 of the investigation. Relatedly, CBP has revised the regulatory
language in Sec. 165.23(c)(2) providing CBP with the discretion to
officially extend the 200-day deadline for providing factual
information, as discussed in more detail in section III below.
Comment: One commenter wrote that a consolidation of allegations
does not seem appropriate in evasion investigations because only the
importer is submitting the import declaration as to whether merchandise
is covered by an AD/CVD order, and only the importer may evade an AD/
CVD order. The commenter opined that a mere similarity of covered
merchandise should not be the basis for a claim of evasion and, thus,
not a basis for consolidation.
Response: CBP disagrees with the commenter. Each EAPA allegation
regarding an importer stands on its own merit. CBP judiciously uses the
consolidation ability and bases consolidation on various criteria, such
as those listed in Sec. 165.13(b)(1)-(4). When allegations against
importers are consolidated at the interim measures point, it is because
there is reasonable suspicion that all the importers are engaged in
evasion.
Comment: Two commenters stated that CBP should allow for the filing
of one allegation against multiple importers if they are involved
together in a duty evasion scheme. Given that the entities involved in
an evasion may use a host of different importers of record as alter
egos by which to improperly enter goods, limiting an allegation to a
single importer would decrease efficiency for filers of allegations and
CBP, and increase the burden to determine which importer was involved
in an evasion. One of the commenters added that if confidentiality is a
concern, CBP should implement an administrative protective order (APO)
process in such cases.
Response: CBP disagrees with both commenters. Every EAPA allegation
stands on its own. Allowing one allegation against multiple importers
would be problematic if the alleger did not correctly name one of the
importers or provided insufficient facts against one of the importers.
In that instance, the alleger would have to withdraw the allegation
against all the importers in order to re-submit an allegation against
only one or more importers. In addition, since the statutory language
in 19 U.S.C.
[[Page 19245]]
1517(b)(2) (``. . . allegation that a person has entered covered
merchandise . . .'') (emphasis added) is written in singular form,
allowing allegations against more than one importer would be
inconsistent with the current statutory language and would require a
statutory change. Nonetheless, CBP may consolidate allegations under
certain circumstances. However, as explained in more detail below, CBP
will provide for the use of APOs as part of the EAPA process going
forward.
Comment: Multiple commenters voiced a concern regarding the 95-day
period for notification of CBP's decision to initiate an investigation
pursuant to Sec. 165.15(d)(1). The commenters argued that such a
lengthy delay in notifying the alleged evader about the initiation of
an investigation could impede an importer's due process rights by
significantly limiting the time to prepare a defense. It could deprive
the alleged evader of an opportunity to provide information or
arguments until after the interim measures are in effect. For similar
reasons, another commenter asked for immediate publication of notice of
the initiation of an investigation to enhance transparency.
Response: CBP disagrees with the commenters' suggestion that CBP
issue a notice of initiation of an investigation earlier than 95
calendar days after a decision to initiate has been made. CBP needs
adequate time to investigate the alleged evader's actions, before
notifying the parties to the investigation about the initiation of an
investigation. Issuing a notice of initiation early would allow the
alleged evader to change its tactics in order to disrupt CBP's
investigatory efforts. Pursuant to 19 U.S.C. 1517(b)(1), CBP must make
a decision as to whether the allegation reasonably suggests evasion
within 15 business days of receiving a properly filed allegation in
order to initiate an investigation. No later than 90 calendar days
after commencing an investigation, CBP must make a decision as to
whether there is reasonable suspicion that covered merchandise has been
entered into the U.S. customs territory through evasion. If CBP finds
reasonable suspicion, CBP issues a combined notice of initiation of
investigation and interim measures within five business days of that
decision. Alternatively, if no interim measures are taken, CBP may
issue a notice of initiation of investigation only, by day 95 of the
case. Thus, for ease of administrability of this regulation and others
in part 165 that provide for the notification of decisions five
business days after a decision has been made, CBP has revised Sec.
165.15(d)(1). The revised regulation states in the first sentence that
CBP will issue a notice of its decision to initiate an investigation to
all parties to the investigation no later than five business days after
day 90 of the investigation, removing the current reference to the 95-
calendar-day period. For consistency purposes, CBP also has changed the
second sentence in paragraph (d)(1) to state that in case of interim
measures, a notice to all parties to the investigation will occur no
later than five business days after day 90 of the investigation.
Furthermore, this change will make the regulatory language
consistent with the statutory language, which only mentions a 90-day
timeline, and will also create uniformity for the processes for
initiating and notifying of an investigation, and for taking and
notifying of interim measures. Notwithstanding those time frames, CBP
may make a decision earlier than 90 days if it is ready to do so after
a thorough investigation and notify the parties to the investigation
within five business days of that decision. Additionally, when revising
Sec. 165.15(d)(1), CBP has replaced the word ``notification'' in the
existing regulation with ``notice'' since CBP serves an actual notice
of initiation of an investigation on the parties to the investigation,
as opposed to notification of the parties in some other fashion.
Comment: One commenter asked CBP to amend Sec. 165.15(d) to
provide that CBP notify not only the interested party who filed the
allegation, but also the importer alleged to have engaged in evasion in
a case where CBP determines to not initiate an investigation.
Response: CBP does not agree with the commenter to amend the
regulation. In order to discourage any potential retaliatory actions by
the alleged evader against the alleging party, CBP will not notify the
alleged evader in case of a decision to not initiate an investigation.
If CBP determines to not initiate an investigation due to insufficient
evidence that there is a likelihood of evasion, CBP does not see a need
to make the alleged evader's name public in a notice to not initiate an
investigation.
Comment: One commenter asked that CBP provide for the opportunity
to request an administrative review of a decision to not initiate an
investigation so that the Commissioner of CBP may assess whether the
decision was rendered in accordance with the legislative intent of a
functioning mechanism for potential duty evasion and the plain language
of the EAPA.
Response: Under the plain language of paragraph (f) of 19 U.S.C.
1517, administrative review may be requested for determinations made
under 19 U.S.C. 1517(c). No provision in the statute authorizes CBP to
conduct an administrative review of a decision to not initiate an
investigation, which is not a determination under 19 U.S.C. 1517(c).
Furthermore, CBP provides technical assistance to allegers on
strengthening their allegations as a matter of practice and allegers
have the opportunity to refile insufficient allegations as more
information becomes available which would show that potential evasion
is occurring.
Comment: One commenter recommended that the regulations be revised
to create a single time frame for the notification of decisions to
initiate and to not initiate an investigation and suggested both time
frames be within 30 days of receipt of an allegation.
Response: CBP disagrees with the commenter's recommendation for the
creation of a single time frame for the notification of CBP's decisions
to initiate and to not initiate. Due to the different nature of these
decisions, it is not practical to have one single timeframe for CBP to
follow. There are different evidentiary standards and different timing
requirements attached to the two types of decisions. As mentioned
above, CBP has 15 business days to determine whether to initiate or to
not initiate an investigation under the ``reasonably suggests''
standard. If CBP determines that it will not initiate an investigation,
it will notify the alleger within five business days of that decision
pursuant to Sec. 165.15(d). If CBP determines within 15 business days
of a properly filed allegation that it will initiate an investigation,
CBP usually takes 90 calendar days to determine whether ``reasonable
suspicion'' exists before making a decision to implement interim
measures (or not) and informing the alleger and importer in case of a
decision to implement interim measures. Thus, a notification 30 days
after receipt of an allegation, as suggested by the commenter, is
generally too short a time frame for CBP to examine all the facts and
both determine whether to initiate an investigation and whether there
is reasonable suspicion that evasion is occurring.
Comment: One commenter asked CBP to specify how CBP will notify of
its decision to initiate, and asked CBP to require parties making
allegations to provide certain information, such as the name of a
contact person, mailing and email address of the importer alleged to
have evaded, the foreign producer or exporter of covered merchandise,
and the government of the country from
[[Page 19246]]
which the covered merchandise was exported.
Response: CBP has been providing notices of initiation of an
investigation to the parties to the investigation pursuant to Sec.
165.15(d)(1) via email. With the implementation of the EAPA Portal, CBP
notifies the parties to the investigation through the system via an
email to the alleging party and the alleged evader. In addition, CBP
publishes public versions of the notices of initiation of an
investigation on its website. Further, to respond to the second part of
the comment, CBP already requires name and address for importers; any
additional specific contact information would be too burdensome for
allegers to include in an allegation, as not all the contact
information the commenter listed above is relevant, and, in some
instances, it is already publicly available. CBP believes that
requiring this additional information would hinder the submission of
allegations, without benefit to the EAPA investigation process.
Comment: One commenter stated that CBP should add language that
would authorize CBP to self-initiate cases where the criteria in Sec.
165.15(b) are met.
Response: CBP disagrees with the commenter. An amendment of Sec.
165.15(b) would require a statutory change, as 19 U.S.C. 1517(b)(1) and
(b)(3) allow for the initiation of an investigation pursuant to the
submission of an allegation by an interested party or a request by
another Federal agency, but not self-initiation by CBP.
Comment: One commenter stated that the ``reasonably suggests''
standard in Sec. 165.15(b)(2) burdens domestic producers having to
prove evasion at the outset in order to have an investigation
initiated, whereas the statute only asks for information reasonably
available to the party who filed the allegation. See 19 U.S.C.
1517(b)(2)(B).
Response: CBP disagrees with the commenter. Pursuant to 19 U.S.C.
1517(b)(2)(B), the allegation must be accompanied by information
reasonably available to the party who filed the allegation. However,
the threshold for initiating an investigation is that the information
provided by the alleger reasonably suggests that evasion occurred,
pursuant to 19 U.S.C. 1517(b)(1), which is the same standard as in
Sec. 165.15(b)(2). The regulatory language does not unduly burden the
alleger by imposing a stricter standard. Moreover, CBP evaluates on a
case-by-case basis the merits of each allegation and decides if the
``reasonably suggests'' standard for initiation of an investigation is
met.
Comment: One commenter suggested that CBP periodically publish
examples of information that was deemed reasonably available to the
interested party and sufficient to support an allegation in prior
investigations, as well as examples of information sufficient to meet
the initiation standard.
Response: CBP currently informs the public through outreach to the
industry in the form of presentations on EAPA and provides technical
assistance and guidance when allegations are filed. In addition, as
mentioned above, CBP publishes public versions of notices of initiation
of an investigation on <a href="http://CBP.gov">CBP.gov</a>, providing examples of information that
meets the initiation standard.
Comment: One commenter stated that CBP should urge Commerce to make
public the procedures it intends to use in case of a covered
merchandise referral and include provisions to allow interested parties
to file comments.
Response: CBP disagrees with the commenter. Commerce decides how to
best respond to covered merchandise referrals in EAPA investigations,
according to its authority and current practices. Moreover, the
referral process has been working well between the two agencies and CBP
does not see a need for a change.
Comment: One commenter supported the requirement in Sec. 165.16
that CBP refer a scope issue to Commerce at any point after receipt of
the allegation, whereas a second commenter stated that CBP should,
where possible, wait until after the issuance of interim measures to
request a covered merchandise determination from Commerce. The second
commenter argued that if CBP requested a covered merchandise
determination prior to interim measures, then the covered merchandise
referral might be the first time that an importer or other party
learned about the evasion proceedings, which could undermine CBP's law
enforcement interest to quickly investigate the allegations and gather
information prior to issuing interim measures. In addition, the second
commenter asked CBP to encourage Commerce to act expeditiously when
processing a covered merchandise referral.
Response: CBP appreciates the comments. CBP decides on a case-by-
case basis whether there is a need to refer scope issues to Commerce.
According to Sec. 165.16(a), CBP may refer the issue to Commerce for
Commerce to determine whether imported merchandise constitutes covered
merchandise, at any point after receiving the allegation. The statute
(19 U.S.C. 1517(b)(4)) does not limit CBP's ability to refer a scope
matter to Commerce within a certain time frame but allows CBP to make
this decision depending on the circumstances of the specific
investigation. With regard to the second part of the last comment, CBP
has no jurisdiction over Commerce's authority to set timelines, and no
influence over another agency's internal processes.
Comment: One commenter asked that CBP modify the interim
regulations to further explain Commerce's covered merchandise
proceeding, clarify whether or not interested parties would be able to
participate in that proceeding, and whether Commerce's scope
determination is appealable.
Response: Commerce processes covered merchandise referrals and
determinations according to its own statutory and regulatory authority
and CBP cannot amend CBP's regulations to discuss or clarify Commerce's
authority and procedures. Nor is CBP in a position to opine on judicial
review related to Commerce proceedings. We note, however, that Commerce
has promulgated regulations to address covered merchandise referrals
from CBP, at 19 CFR 351.227.
Comment: One commenter asked that CBP add a definition in Sec.
165.16(c) for the word ``promptly.'' The commenter also suggested that
CBP make a referral to Commerce within 30 days of initiation of the
investigation, and CBP provide notice of the referral within five days
of the referral.
Response: CBP disagrees with the commenter's request to add a
definition for the word ``promptly.'' CBP makes determinations
regarding covered merchandise referrals on a case-by-case basis and
refers scope issues to Commerce as appropriate. As stated above, CBP
may refer to Commerce at any point after receipt of an allegation.
Further, CBP notifies the parties to the investigation as to when CBP
sends the covered merchandise referral to Commerce.
Comment: One commenter argued that CBP should provide for a
mechanism for an interested party to seek relief when CBP improperly
refuses to refer a scope issue to Commerce and for situations where CBP
improperly suspends liquidation of entries when the scope issue is
being disputed.
Response: CBP disagrees with the commenter's argument. CBP works
with the appropriate internal subject matter experts during an EAPA
investigation and, in addition, works with the Customs Liaison Unit at
Commerce, and
[[Page 19247]]
refers cases to Commerce regarding the scope of an AD/CVD order when
appropriate. The covered merchandise referral to Commerce pursuant to
19 U.S.C. 1517(b)(4) is a specific authority for CBP to use in EAPA
investigations, as needed, and should remain within CBP's discretion.
Apart from CBP's authority to refer issues to Commerce for a covered
merchandise determination, an interested party also has the ability to
seek resolution of a scope issue before Commerce pursuant to Commerce's
regulations found at 19 CFR 351.225 and 19 CFR 351.227. CBP does not
believe that an additional mechanism is needed in this rulemaking. With
regard to the second part of the comment, CBP does not believe that a
process is needed for a situation where the importer alleges that CBP
improperly suspended liquidation of entries when the scope was being
disputed. If CBP determines that there is reasonable suspicion that the
importer entered covered merchandise into the customs territory of the
United States, TRLED will instruct the Center to suspend liquidation of
entries of such covered merchandise that entered on or after the date
of initiation of the investigation or extend the period for liquidating
each unliquidated entry of such covered merchandise that entered before
the date of the initiation of the investigation, and take other
measures necessary to protect the revenue. CBP needs to conclude its
investigation to issue a determination as to evasion, and does not
overturn interim measures, such as the suspension of liquidation or the
extension of the liquidation period, until a determination has been
made.
Investigation Procedures (Subpart C)
Subpart C (Investigation Procedures) includes provisions setting
forth the EAPA investigation procedures, such as the maintenance of an
administrative record, the time period provided for an investigation
and the deadline for making a determination, the types and requirements
for the submission of factual information, and the issuance of interim
measures. This subpart also describes CBP's authority to conduct
verifications of information, deals with the submission of written
arguments to CBP and responses to written arguments, and finally sets
forth the process for the issuance of a determination as to evasion and
the assessment of duties and other actions in case of an affirmative
determination. Commenters submitted questions regarding public access
to the administrative record, questions surrounding the submission of
factual information, and the interim measures process, as well as the
verification process.
Comment: One commenter stated that it is unclear from the
regulations how and to what extent parties to the investigation would
be able to access public information during the course of the
investigation or administrative review. The commenter asked that CBP
amend the regulations to include a provision that sets forth where CBP
would maintain an up-to-date public administrative record, how CBP
would guarantee access, and when and how CBP would share public
information.
Response: The EAPA Portal provides the parties to the investigation
with access to the public documents and public versions of documents
relating to the EAPA proceeding and allows the parties to the
investigation to view the public administrative record. In addition,
CBP publishes public versions of notices of initiation of an
investigation, notices of initiation of an investigation and interim
measures, covered merchandise referrals, and determinations as to
evasion on its website, in a timely manner. Finally, CBP appreciates
the opportunity to announce that CBP has started publishing public
versions of final administrative review determinations.\3\ CBP has
uploaded earlier public versions of final administrative review
determinations to its website.
---------------------------------------------------------------------------
\3\ The final administrative review determinations may be found
online at <a href="https://www.cbp.gov/trade/trade-enforcement/tftea/eapa">https://www.cbp.gov/trade/trade-enforcement/tftea/eapa</a> by
clicking on the field titled ``Request for Administrative Review,''
and then on the blue ``Final Administrative Determinations'' button.
The published determinations may also be found online at <a href="https://www.cbp.gov/trade/trade-enforcement/tftea/eapa/requests-administrative-review">https://www.cbp.gov/trade/trade-enforcement/tftea/eapa/requests-administrative-review</a> by clicking on the field titled ``Final
Administrative Determination,'' or on the blue ``Final
Administrative Determinations'' button.
---------------------------------------------------------------------------
Comment: While one commenter supported the opportunity for parties
to the investigation to submit factual information pursuant to Sec.
165.23(b), another commenter asked CBP to clarify in Sec. 165.23(a)
that CBP may request information from any party who has relevant
information.
Response: CBP appreciates the comments. However, CBP disagrees with
the second commenter that a regulatory change is needed to clarify that
CBP may request information from any party who has relevant
information. The universe of persons from whom CBP may request
information pursuant to Sec. 165.23(a) is broad, and CBP does not
believe that it needs to be specifically defined.
Comment: One commenter stated that it would be useful for the
purpose of identifying an importer, especially in situations where
importers are incorporated under multiple different names, or when
several related companies act as importers of record through an agent,
that CBP include in the scope of an EAPA investigation activities
engaged in by companies related to an identified importer, which
support the allegation.
Response: CBP disagrees with the commenter's suggestion. Although
an alleger is free to include information about the activities of a
company related to an identified importer in its allegation, the
statutory language does not require the inclusion of such information.
Furthermore, such a requirement would create an additional barrier that
may inhibit the submission of some legitimate allegations.
Comment: One commenter supported the establishment of a service
list for purposes of serving other parties with public versions of
documents, and asked CBP to amend the regulations to set forth the
requirements for the maintenance of such a list.
Response: CBP does not agree with the commenter's request to add a
requirement for maintenance of a service list in the regulations. CBP
currently releases public versions of documents to the parties to the
investigation, which CBP believes is sufficient. Public documents and
public versions of documents are also available to the parties to the
investigation in the EAPA Portal.
Comment: Multiple commenters asked CBP to modify its regulations so
that parties can submit confidential documents via a secure electronic
filing system, as opposed to email, and allow attorneys and other
interested parties to easily monitor the ongoing investigation. One
commenter also asked CBP to provide for the hand delivery of documents
if documents contain confidential information, or delivery by mail if
the document to be submitted exceeds a certain size limit.
Response: The EAPA Portal allows parties to submit confidential
documents, and the parties to the investigation, as well as their
attorneys, are able to monitor the status of an EAPA proceeding.
Further, CBP already allows for hand delivery on a case-by-case basis,
in instances of voluminous submissions or the submission of
confidential documents. A party who wishes to hand-deliver documents
must file a request with TRLED and provide a reason why the documents
cannot be filed electronically. The regulation does not need to be
amended as the option of hand delivery is already included in Sec.
165.5(b)(1) as a method approved or designated by CBP. Regarding the
last
[[Page 19248]]
comment, delivery by mail is not allowed, but if there are size
limitation issues with the EAPA Portal, parties may contact the EAPA
Investigations Branch at <a href="/cdn-cgi/l/email-protection#30555140515c5c55575144595f5e43705352401e5458431e575f46"><span class="__cf_email__" data-cfemail="42272332232e2e272523362b2d2c31022120326c262a316c252d34">[email protected]</span></a>.
Comment: One commenter requested that CBP add a provision in the
regulations to allow for the filing of a ``Bracketing Not Final''
version of a submission first, followed by the final, public version
the next business day. The commenter believes that this additional time
is necessary to review any business confidential information to make
sure that the public version is correct. The commenter argued that this
change would make CBP's regulations consistent with those of Commerce,
the U.S. International Trade Commission (ITC), and the CIT.
Response: CBP disagrees with the commenter's request to allow for
the filing of a ``Bracketing Not Final'' version first, followed by a
final, public version the next business day. Section 165.4(a)(2) states
that the public version should be filed on the same date as the
business confidential version and gives CBP the opportunity to reject a
public version, if needed. Simultaneous filing ensures that the other
parties to the investigation timely receive documents, since only
public versions are provided to other parties in an EAPA investigation.
Commerce, ITC, and CIT procedures differ in this regard, in that
confidential versions are provided to other parties under protective
orders.
Comment: One commenter asked CBP to modify Sec. 165.23(c)(1) to
set a deadline for service of the public version of a submission of
factual information, which currently is missing in the regulations.
Response: CBP disagrees with the commenter. Section 165.23, first
sentence, refers to Sec. Sec. 165.4 and 165.5 with regard to the
submission requirements. Specifically, Sec. 165.4(a)(2) addresses the
requirement to submit a public version on the same date as the business
confidential version.
Comment: One commenter asked CBP to clarify in Sec. 165.23(c)(2)
whether the service requirement applies to the submission of all
factual information, or only to factual information submitted after a
certain point in the investigation. The commenter stated that pursuant
to Sec. 165.23(c)(2), parties submitting factual information are
required to serve on parties to the investigation a public version of
the submission. The commenter went on to say that if an alleging party
submitted factual information after the initial allegation, but prior
to the issuance of interim measures, it would be unclear whether
service of that information on other parties would interfere with CBP's
enforcement efforts in case CBP had not yet notified certain parties of
the investigation.
Response: CBP disagrees with the commenter's request to modify
Sec. 165.23(c)(2). The service requirements in Sec. 165.4 apply
throughout the investigation; there is no distinction in the
regulation, or in practice, regarding the timing of the submission of
factual information. However, CBP wishes to clarify that any documents
submitted prior to the notice of initiation of an investigation will be
served by TRLED on the parties to the investigation soon after the
issuance of the notice, regardless of who submitted those documents.
For additional clarity, CBP added a sentence to that effect at the end
of Sec. 165.15(e).
Comment: One commenter stated that CBP should adopt a regulation
that imposes interim measures if Commerce finds that imported
merchandise is covered by an AD/CVD order and that tolls the CBP
deadlines for the completion of the investigation. Otherwise, the
commenter noted, if Commerce issues a scope determination which is
subject to judicial review and CBP's regulations do not toll CBP's
administrative deadlines during the pendency of judicial review, it may
be the case that an importer is labeled an ``evader'' even though the
underlying facts for the scope determination are subject to dispute.
The commenter opined that adding a regulation as described above would
ensure that importers will not be labeled as duty evaders unless and
until all their due process rights have been exhausted.
Response: CBP disagrees with the commenter. CBP considers decisions
by various internal stakeholders as well as other government agencies
when reaching the decision to take interim measures, but CBP has
independent authority to determine if or when to impose interim
measures. CBP takes interim measures after careful examination of the
facts and information provided, concluding that there is reasonable
suspicion that evasion has taken place. Judicial review of a scope
determination should not put the EAPA investigation on hold because CBP
needs to timely continue its process, as provided in the regulations,
to fully investigate the facts relating to the allegation and make a
determination as to evasion. CBP notes that Congress, through the
statutory timelines set forth in EAPA, made clear that it intended
prompt action on the part of CBP.
Comment: One commenter requested that CBP amend Sec. 165.24(c) to
state that CBP will share the public administrative record with
Commerce upon issuing interim measures. The commenter argued that the
connection between Commerce's administration and enforcement of AD/CVD
orders and CBP's efforts to combat evasion under EAPA necessitates that
the agencies share information and work together to maximize
enforcement.
Response: CBP does not see a need to amend the regulations so CBP
may share the administrative record with Commerce after the issuance of
interim measures. CBP regularly shares information with Commerce, based
on the circumstances of the case and in accordance with law.
Comment: One commenter asked CBP to clarify in Sec. 165.25 that
the verification process takes place sometime between initiation of the
investigation and the 200th calendar day after the initiation, that a
verification agenda is included, and modify the regulations to provide
for a verification report that CBP will place on the administrative
record.
Response: CBP does not agree with the commenter that the
verification process must be completed by the 200th calendar day after
initiation of an investigation. Rather, verification generally occurs
after all new factual information has been submitted to the
administrative record. The deadline for voluntary submission of new
factual information is established in Sec. 165.23. To clarify that CBP
may conduct verifications before and after the deadline for voluntary
submission of factual information, CBP has revised the language in
Sec. 165.25(b). In addition, CBP added a sentence in paragraph (b) to
confirm that the purpose of the verification is to verify the accuracy
of the information already placed on the administrative record.
Regarding the commenter's second request, CBP already provides a
verification agenda to the parties to the investigation and does not
believe that it needs to be specifically stated in the regulation.
To respond to the commenter's request regarding the verification
report, CBP added a new paragraph (c) stating that CBP will place a
report about the verification, i.e., the verification report, on the
administrative record. CBP will also require the party that underwent
the verification to place verification exhibits, which will generally
contain information compiled and verified by CBP at CBP's discretion
during the verification, on the administrative record. In accordance
with Sec. 165.4, CBP and the party that underwent the verification
will provide public versions of their verification documents, which
will be served on all parties to the
[[Page 19249]]
investigation. CBP will not accept voluntary submissions of new factual
information at the verification after the deadline for such
submissions, as referenced in Sec. 165.23. Further, parties to the
investigation cannot submit rebuttal information to either CBP's
verification report or the verification exhibits. Parties to the
investigation, however, may submit to CBP written arguments in relation
to the verification report and/or its exhibits in accordance with Sec.
165.26.
CBP also added a new paragraph (d) stating that if CBP determines
that information discovered during a verification is relevant to the
investigation and constitutes new factual information, CBP will place
it on the administrative record separately, in accordance with Sec.
165.23, and allow the parties to the investigation to submit rebuttal
information.
Comment: One commenter expressed support of Sec. 165.26 but was
concerned that the 50-page limit in paragraph (d) may be too short in
some cases. The commenter suggested that CBP explicitly state in the
regulation that it would increase the page limitation upon request when
good cause is shown.
Response: CBP disagrees with the commenter's suggestion and
supports the regulation as currently written. Written arguments are a
summary of record evidence and new information is not permitted. CBP
believes that 50 pages is a reasonable limit and does not see a need to
provide for exceptions in the regulation.
Comment: One commenter stated that CBP should clarify in Sec.
165.26(c) that CBP may request written arguments on any issue from any
interested party.
Response: CBP believes that Sec. 165.26(c) as currently written is
properly limited to the parties to the investigation. However, to make
the terminology in Sec. 165.26(c) clearer, CBP changed the regulatory
language from ``any party'' to the investigation to ``the parties'' to
the investigation.
Comment: One commenter argued that CBP should make it clear in
Sec. 165.27(a) that a determination must be based on substantial
evidence on the record, and add a reference to the administrative
record, as defined in Sec. 165.21.
Response: CBP does not see a need to add a clarification in the
regulation. Section 165.27(a) already contains language that a
determination is based on substantial evidence as to whether covered
merchandise was entered into the U.S. customs territory through
evasion. In addition, Sec. 165.21(a) states that CBP maintains an
administrative record for purposes of making a determination as to
evasion under Sec. 165.27. When both regulations are read together, it
is clearly stated that CBP's determination as to evasion is based on
substantial evidence on the administrative record. In current practice,
CBP states in its affirmative determinations that CBP reviewed the
administrative record and found that it contained substantial evidence
of evasion.
Comment: One commenter suggested that CBP add a sentence to Sec.
165.27(b) to state that CBP will provide parties to the investigation
with a public version of the administrative record no later than five
business days after making a determination as to evasion, the same date
that CBP sends the parties to the investigation a summary of the
determination limited to publicly available information. This suggested
language would mirror the language in Sec. 165.24(c) for interim
measures, which includes a notification of the decision to the parties
of the investigation, along with a public version of the administrative
record on the same date.
Another commenter suggested that Sec. 165.27(b) be amended to
provide a detailed and meaningful public explanation as to what should
be covered by the summary of CBP's determination as to evasion since
that summary would serve as the primary basis for a party's decision
whether to request an administrative review and subsequent judicial
review.
Response: With regard to the first comment, once parties to the
investigation are notified of an investigation, and then throughout the
remainder of the investigation, the administrative record is made
available in the EAPA Portal. CBP does not agree that the regulation
needs to be amended to that effect. Pursuant to Sec. 165.27(b), CBP
will provide a summary of the determination as to evasion, limited to
publicly available information, to the parties to the investigation. As
part of the public version of the determination as to evasion, CBP
includes a short summary of the redacted information in brackets that
was deemed business confidential information. Additionally, as
discussed in more detail below, CBP will provide for an APO process so
parties to the investigation may access business confidential
information. Thus, an amendment to Sec. 165.27(b) as suggested by the
second commenter is not necessary.
Comment: One commenter stated that Sec. 165.27 does not appear to
contemplate the publication of a determination as to evasion, and a
summary is available only to the parties to the investigation. The
commenter suggested that CBP add a new paragraph (c) to Sec. 165.27
stating that no later than 90 days after making a determination as to
evasion, CBP would publish a summary of the determination limited to
publicly available information in the Customs Bulletin or make the
determination otherwise available for public inspection.
Response: CBP disagrees with the commenter's suggestion to amend
Sec. 165.27. In addition to informing the parties to the investigation
about the determination electronically, CBP has been publishing a
public version of the determination on its website. The public version
of a determination is also available to the parties to the
investigation in the EAPA Portal.
Comment: One commenter stated that a party's right to judicial
review, as granted in 19 U.S.C. 1517(g), is restricted by the
regulations as the regulations limit a party's right to public
information only, and thereby deprive the party of full knowledge of
the basis for CBP's determination. It is the commenter's opinion that
CBP must provide the parties to the investigation with some level of
access to proprietary information in order for CBP to give full effect
to the statute.
Response: CBP agrees with the commenter's request to provide access
to another party's proprietary information. As discussed in more detail
below, CBP will establish an APO process to allow for the release of
business confidential information to parties to the investigation.
Administrative Review of Determinations (Subpart D)
Subpart D (Administrative Review of Determinations) specifies the
requirements for requesting an administrative review of a determination
as to evasion, discusses the submission of responses to the request for
administrative review, and describes CBP's authority to request
additional information from the parties to the investigation. This
subpart also deals with the administrative review standard, the ability
to file for judicial review of the final administrative determination,
and, finally, potential penalties and other actions that CBP may
undertake pursuant to any other relevant laws. CBP received comments
regarding the publication of final administrative determinations, the
availability of rebuttal information during an administrative review,
and questions on the de novo review process for administrative reviews.
Comment: One commenter expressed concern with regard to the 30-
business-day deadline (Sec. 165.41(d)) for requesting
[[Page 19250]]
an administrative review of a determination as to evasion and asked for
clarification in the regulations. The commenter stated that it is
unclear whether ``issuance'' in the regulation refers to the date CBP
signs the initial determination, the date it is sent to the parties,
the date it is received by the parties, or some other date.
Response: CBP appreciates the opportunity to clarify that the date
of issuance is the date that the determination is signed by CBP and
also electronically transmitted to the parties to the investigation. In
a rare case where the determination as to evasion is signed on one day
and electronically transmitted the next business day, the date of
electronic transmittal is considered the date of issuance.
Comment: One commenter asked for the regulations to be amended to
expressly allow for rebuttal information in administrative reviews.
Response: CBP disagrees with the commenter. Under Sec. 165.44, CBP
may request additional written information from the parties to the
investigation at any time during the administrative review process;
however, these requests are narrowly tailored for specific information
related to a record that has already been created during the course of
the investigation. CBP has a strict 60-business-day review period to
issue a determination on the request for administrative review. See 19
U.S.C. 1517(f) and 19 CFR 165.41(i). Any rebuttal information from the
parties on additional information requested by CBP would reduce the
number of days that Regulations and Rulings (RR) has available to
conduct a de novo review of the record information and issue a final
administrative determination. However, should CBP determine that
rebuttal information is useful, then Sec. 165.44 permits CBP to
request such information.
Comment: One commenter stated that the language in Sec. 165.45 is
contradictory because the administrative review process is described to
be de novo and, at the same time, based on specific facts and
circumstances already on the administrative record. It is the
commenter's opinion that parties should be able to provide any
information they deem appropriate in the administrative review process
since it is a de novo review.
Response: CBP disagrees with the commenter's request. EAPA requires
that an administrative review be rendered within 60 business days (19
U.S.C. 1517(f)), which is in contrast to a much longer time frame (up
to 360 calendar days) that CBP has available to render a determination
as to evasion. The short deadline for the administrative review makes
it impracticable for CBP to accept additional information that parties
wish to submit. Rather, the administrative review must be based solely
on the facts already on the record, with the exception being if CBP
believes that it needs additional information in accordance with Sec.
165.44 to be able to render its decision, as mentioned above. To
clarify even further, CBP added the phrase ``in response to a request
by CBP'' before ``pursuant to Sec. 165.44'' to emphasize that CBP will
only consider additional information if CBP specifically requested that
information.
Comment: One commenter asked CBP to add a paragraph in Sec. 165.46
that sets forth that final administrative determinations are published
in the Customs Bulletin or are otherwise made available for public
inspection no later than 90 days after the issuance of the final
administrative determination.
Response: CBP disagrees with the commenter's suggestion to amend
the regulation as there is no need to include in the regulatory text a
requirement for the publication of the final administrative
determination. As mentioned in more detail above, CBP has started
publishing final administrative determinations, limited to public
information, on its website.
Comment: One commenter stated that CBP should clarify that any
actions taken apart from the EAPA investigation will not disadvantage
False Claims Act (FCA) relators. The commenter stated that Sec. 165.47
expressly states that no action taken under EAPA prevents CBP from
assessing penalties of any sort related to such cases or taking action
under any other relevant laws and that CBP should extend this
recognition to claims brought under the FCA in the final regulations.
Response: CBP disagrees with the commenter's request for
clarification of Sec. 165.47. EAPA investigations do not prevent
actions by CBP or other government agencies under other authorities,
including FCA, and CBP's and other governmental agencies' rights to
undertake additional investigations or enforcement actions in cases
covered by the EAPA provisions are already established in Sec. 165.47.
See also 19 U.S.C. 1517(h).
Comment: Multiple commenters stated that a determination as to
evasion should not be a protestable decision and asked that CBP clarify
in the regulations that the administrative process and judicial review
under 19 U.S.C. 1517(f)-(g) are the only avenues by which a party may
challenge a determination.
Response: CBP agrees with the commenters that a determination as to
evasion in an EAPA investigation is not a protestable decision.
Sections 1517(f)-(g) of 19 U.S.C. establish both an administrative and
judicial review process for EAPA determinations made by CBP. The
administrative and judicial review processes are the exclusive means by
which EAPA determinations can be reviewed. However, CBP does not see a
need to clarify this in the final regulations at this time.
Other Comments
Comment: Multiple commenters asked that CBP publicly disclose key
events, such as the initiation of an investigation, or determination as
to evasion, to a wider trade community, either in form of a searchable
docket or some other type of publication process for the key documents.
The commenters argued that such disclosure would deter future evasion
attempts and promote increased compliance by all parties.
Response: CBP already publishes public versions of notices of
initiation of an investigation, notices of initiation of an
investigation along with interim measures (if CBP takes interim
measures after initiating an investigation), covered merchandise
referrals, determinations as to evasion, and now final administrative
determinations as well, on its website. To further promote transparency
of the EAPA process, those decisions are viewable in the EAPA Portal by
the parties to the investigation.
Comment: Multiple commenters have urged CBP to create an APO
process or similar process in the final regulations, which would allow
authorized representatives of interested parties to obtain and review
confidential information submitted by other interested parties. While
the commenters acknowledge that the statute did not explicitly
authorize CBP to create an APO, these commenters note that such
specific statutory authorization is not necessary given that Congress
has broadly authorized CBP to promulgate regulations necessary to
implement the provisions of TFTEA. The commenters claim that the lack
of an APO hinders the parties' ability to meaningfully participate in
EAPA proceedings in multiple ways. The commenters argue that the
parties affected by CBP's decision-making will not have full access to
information contained on the administrative record unless and until
judicial review is requested. Further, the inability to have access to
other parties' business confidential information prevents other parties
to the investigation from providing rebuttal information and from
[[Page 19251]]
submitting arguments at the administrative level based on a review of
the complete information. Finally, the commenters argue that the lack
of an APO makes the administrative process more burdensome for CBP,
because CBP must respond to irrelevant arguments and evidence submitted
by parties, who, without full access to the record, are unable to
assess the nature of that record and other parties' claims.
Response: CBP agrees with the commenters that Congress provided CBP
with authority to ``prescribe such regulations as may be necessary'' to
implement the requirements under the statute. CBP, by regulation, has
created an investigation procedure that allows participation by the
parties to the investigation. Under Sec. 165.4, any party submitting
information to CBP may request confidential treatment for information
protectable under 5 U.S.C. 552(b)(4). The party must identify such
confidential information by placing it in brackets, marking the first
page as confidential, and providing an explanation for requesting
confidential treatment. The interested party must also file a public
version of the confidential document. Under Sec. 165.4(a)(2), the
public version must contain a summary of the confidential information
with sufficient detail to permit a reasonable understanding of the
substance of the information. If the submitting interested party claims
that summarization is not possible, the claim must be accompanied by a
full explanation of the reasons supporting that claim. Public summaries
that do not meet this requirement will be rejected.
Moreover, in order to allow meaningful participation in the
proceedings, and for purposes of transparency, CBP will not accept
claims of confidential treatment for the following information: (1)
name of the party to the investigation providing the information, its
agent filing on its behalf, if any, and email address for communication
and service purposes; (2) basis upon which the party making the
allegation qualifies as an interested party as defined in Sec. 165.1;
(3) name and address of importer against whom the allegation is
brought; (4) description of covered merchandise; and (5) applicable AD/
CVD orders.
While CBP believes that the above process provides parties to the
investigation with a meaningful opportunity to participate in the EAPA
investigation, CBP acknowledges that, on July 27, 2023, the U.S. Court
of Appeals issued a decision in Royal Brush Mfg. v. United States, 75
F.4th 1250 (Fed. Cir. 2023), with respect to the issue of a need for an
administrative protective order in that case. In light of that
precedential decision, CBP is reviewing its procedures with respect to
the disclosure of business confidential information during EAPA
investigations. As such, CBP has amended Sec. 165.4 and added language
in the introductory text of paragraph (a) to state that if the
requirements of Sec. 165.4 are satisfied and the information is
privileged or confidential in accordance 5 U.S.C. 552(b)(4), CBP will
grant business confidential treatment and issue an APO, in compliance
with the mandate in Royal Brush. Further, CBP added a new paragraph
(f), stating that in each investigation where CBP grants a request for
business confidential treatment, CBP will issue an APO which will
contain terms that allow the representatives of the parties to the
investigation to access the business confidential information. CBP will
publish guidance to provide additional information on this new APO
process, and CBP is also considering whether to initiate a separate
rulemaking for purposes of further codifying an APO process. Finally,
CBP made several additional changes to Sec. 165.4, unrelated to an APO
process, which may be found in section III below.
Comment: Multiple commenters stated that CBP must follow the
statutorily mandated deadlines and should clarify in the final
regulations that they are mandatory.
Response: CBP abides by all statutory deadlines such as CBP's
decision to take interim measures no later than 90 days after
initiating an investigation under 19 U.S.C. 1517(e), CBP's
determination as to evasion no later than 300 days after initiating an
investigation pursuant to section 1517 (c)(1)(A), and the 60-business-
day timeline for making a final administrative determination pursuant
to section 1517(f)(2). CBP does not believe that a clarification in the
final regulations is necessary.
Comment: One commenter stated that CBP should clarify in the final
regulations that all ex parte communications of substance will be
memorialized in the administrative record and public versions of such
written memorialization should be promptly disclosed to the other
parties to the proceeding.
Response: CBP disagrees with the commenter that the memorialization
of ex parte communications needs to be specifically outlined in the
regulations. Substantive ex parte communications are memorialized, and
public versions are disclosed to the parties to the investigation as a
matter of practice.
Comment: One commenter voiced concerns with regard to section
411(b)(4)(B) of TFTEA, specifically the provision of information on the
status of CBP's consideration of an evasion allegation and related
decision whether or not to pursue any administrative inquiries or other
actions as a result of an allegation to a party or parties who
submitted an allegation as to evasion. The commenter stated that this
provision appears to authorize CBP to allow the alleging party to
request Federal documents, which will likely include business
confidential information of the importer. The commenter further argued
that this provision disadvantages the importer by giving the alleging
party information that the importer cannot review and of which the
importer is not aware, making this provision fundamentally unfair.
Response: CBP disagrees with the commenter, who is not interpreting
the statute in the way that CBP is administering EAPA. While the
alleging party may be aware that CBP is processing an allegation before
the alleged evader is, CBP does not share business confidential
information of other entities with the alleging party at any stage of
the investigation. All parties to the investigation are notified
whether or not interim measures are taken once an investigation is
ongoing and are allowed to participate in the investigation from that
point forward.
Comment: One commenter stated that CBP should prescribe regulations
that obligate customs brokers to collect and verify meaningful
information regarding companies that approach the broker seeking to act
as an importer of record.
Response: CBP thanks the commenter for its contribution; however,
this comment is beyond the scope of this EAPA rulemaking.
III. Technical Changes and Clarifications to the Interim Regulations
In addition to carefully considering and responding to the public
comments, CBP has reviewed the interim regulations in their totality to
assess the effectiveness of the established EAPA process and determine
whether any regulations, other than the ones addressed above in
response to public comments, should be amended. Pursuant to this
review, CBP has made some changes to clarify and update the interim
regulations, emphasizing CBP's goal for a clear and transparent process
and aligning CBP's current practice with the regulations.
CBP made some changes to Sec. 165.1 by clarifying and updating
some of the existing definitions and adding a definition. First, CBP
slightly rearranged the sentence of the definition of
[[Page 19252]]
``allegation'' in Sec. 165.1 for clarity. Next, in the definition of
``TRLED'' in Sec. 165.1, CBP removed the reference to EAPA and
replaced it with a reference to the Trade Facilitation and Trade
Enforcement Act of 2015 (TFTEA) as it is a more accurate reference. CBP
also added a definition for ``Business day'' in Sec. 165.1, which
mirrors the language in 19 CFR 101.1. CBP had received a general
comment regarding the treatment of Inauguration Day (January 20 or
January 21 if January 20 falls on a Sunday) in the context of
calculating deadlines, and CBP wants to take the opportunity to clarify
its position on this subject since this legal holiday in the
Washington, DC, area occurs every four years. Thus, pursuant to the new
definition, and in accordance with 5 U.S.C. 6103(c), Inauguration Day
is not considered a business day for purposes of an EAPA investigation.
CBP made several changes to Sec. 165.4, in addition to the changes
mentioned above. In paragraph (a), CBP added a sentence at the end of
the paragraph to state that all documents and communications that are
submitted to CBP after notice of initiation must be served on all
parties to the investigation by the submitting entity. For business
confidential documents, a public version must be served as well, in
accordance with Sec. 165.4(a)(2). This addition is not a change but
merely a confirmation of CBP's practice. Further, CBP included language
in the introductory sentence in paragraph (b) clarifying that rejected
submissions due to failure to meet the requirements of Sec. 165.4(a)
will not be placed on the administrative record. The same language
regarding the placement on the administrative record was added in Sec.
165.4(b)(3), setting forth the effects of a rejected submission.
Finally, CBP added the phrase ``unless the submitting interested party
takes any of the actions in paragraph (b)(2) of this section within the
timeframe specified in that paragraph'' at the end of the introductory
sentence in paragraph (b), referring to the possibility of corrective
action pursuant to Sec. 165.4(b)(2) in case of a nonconforming
submission.
In addition, CBP added two sentences at the end of paragraph (e),
stating that parties who are not already subject to the requirements of
Sec. 165.4, such as suppliers or customers, must adhere to the
requirements set forth in Sec. 165.4 and Sec. 165.5 when filing
submissions. With this change, CBP is clarifying its current
expectation that interested parties and other parties who submit
information to CBP must follow the same submission requirements.
Additionally, Sec. 165.5(b) states that all submissions to CBP must
adhere to the requirements in part 165. Thus, the addition of the two
sentences in paragraph (e) simply clarifies the requirements set forth
in Sec. 165.4 and Sec. 165.5 and the effect of a nonconforming
submission.\4\
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\4\ CBP added Sec. 165.5(b)(4) in this final rule and the
addition is explained in further detail below.
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In Sec. 165.5(b)(2), CBP added language to clarify that the
certification requirement, along with other submission requirements in
sections 165.4 and 165.5, applies not only to submissions by interested
parties, but also to submissions requested by CBP from any other party.
Lastly, CBP replaced the reference to ``19 CFR'' with a section symbol
in two places in Sec. 165.5(b)(2)(ii) and (iii) to make those
references consistent with other references in the regulations.
In addition, CBP added a new paragraph Sec. 165.5(b)(4), titled
``Nonconforming submissions,'' clarifying that CBP will reject
submissions that do not meet the requirements of paragraph (b) of this
section, and will not consider or place them on the administrative
record. In Sec. 165.5(c)(1), CBP added language in the first sentence
to clarify that the request for extensions applies not only to
regulatory time limits, but also to any deadlines for the submission of
information requested by CBP. CBP has allowed for requests for
extension of non-regulatory deadlines in prior investigations and takes
the opportunity to confirm in the regulation that a party may request
an extension of a deadline set by CBP. In addition, CBP added the words
``by the requester'' at the end of the third sentence of paragraph
(c)(1) in the definition of an extraordinary circumstance, which is an
unexpected event that could not have been prevented even if the
requester had taken reasonable measures. In paragraph (c)(2), CBP
replaced ``retain it in'' the administrative record with ``place it
on'' the administrative record to make the language consistent with
other sections that have similar language.
CBP revised the language in the second sentence of Sec. 165.13(c)
by replacing the 95-calendar-day reference with regulatory language
that reflects CBP's practice of notifying the parties to the
investigation within five business days of making formal a decision to
initiate an investigation and a decision to consolidate after day 90 of
the investigation. This change is similar to the change in Sec.
165.15(d)(1), as explained above. The changes to both Sec. 165.13(c)
and Sec. 165.15(d)(1) will create uniformity among the regulations
dealing with the timing of notification of decisions that CBP makes
throughout the EAPA investigation process. CBP further reorganized the
first sentence in Sec. 165.13(d) to read more easily and added a
reference to public documents that need to be served on parties to the
previously unconsolidated investigation once the parties subject to the
consolidation are notified. Both public versions of documents and
public documents are placed on the administrative record as part of the
EAPA investigation. Lastly, CBP replaced the second and third mentions
of the word ``upon'' in the first sentence of Sec. 165.13(d) with
``on'' for clarity.
CBP amended the first sentence of Sec. 165.14(a) to include the
words ``but not limited to'' after ``including'' to emphasize that any
Federal agency, in addition to Commerce and the ITC, may request an
investigation under part 165.
CBP added a phrase to Sec. 165.16(d) to include interim measures
under Sec. 165.24, along with the deadline to decide whether to
initiate an investigation and the deadline to issue a determination as
to evasion under Sec. 165.27, setting forth that the time period for
any referral to and determination by Commerce will not be counted
toward the deadlines mentioned in this paragraph. The regulation is
based on language in 19 U.S.C. 1517(b)(4)(C), which states that the
period required for the referral to Commerce and the determination
shall not be counted in calculating any deadline under this section,
and interim measures are mentioned in paragraph (e) of section 1517 as
well.
In Sec. Sec. 165.22(a) and (d), CBP replaced the phrase ``not
later'' with ``no later'' to be consistent with the use of the phrase
in other regulations. This technical change does not change the
deadlines associated with a determination as to evasion in this
section. In paragraph (d), CBP changed the word ``notification'' to
``notice'' in the paragraph heading to better reflect CBP's practice of
serving the parties to the investigation with a notice, instead of
simply notifying them of an extension of time to make a determination
as to evasion. Further, CBP rephrased some of the language in Sec.
165.22(b) to mirror the language in Sec. 165.13(a), and with this
final rule, both sections will include the ``date of receipt of the
first properly filed allegation'' instead of the ``date on which CBP
receives the first of such allegations.''
In Sec. 165.23(b), CBP changed the words ``Any party'' to the
investigation at the beginning of the sentence to ``The parties'' to
the investigation. This change clarifies CBP's intent as to who may
submit additional information and makes the language consistent with
the
[[Page 19253]]
term ``parties to the investigation,'' as defined in Sec. 165.1. For
ease of reading, CBP reorganized 165.23(c)(2), breaking it out into
subparagraph (i) dealing with the requirements associated with the
voluntary submission of factual information and subparagraph (ii)
detailing the requirements for the submission of rebuttal information
to the submitted factual information.
In the newly created paragraph (c)(2)(i), CBP added language to
provide CBP with the discretion to extend the deadline for voluntary
submission of factual information if CBP determines that circumstances
warrant an extension. In many past investigations, CBP was under
considerable time constraints to timely review and assess the
information gathered during the investigation before making a
determination as to evasion. In exceptional cases, CBP had already
extended the deadline in Sec. 165.23(c)(2). When the interim
regulations were drafted, the timelines stated therein seemed feasible;
however, CBP's experience over the past seven years has shown that
there are situations where CBP needs additional time to investigate
and, therefore, needs to have the discretion to extend the deadline for
the voluntary submission of factual information when the circumstances
warrant. There may be situations where verifications are difficult to
conduct due to travel restrictions or other obstacles, and CBP needs
the flexibility to extend the deadline for the voluntary submission of
factual information in order to conduct a fulsome investigation. If CBP
extends the deadline in Sec. 165.23(c)(2)(i), the parties to the
investigation will be notified of the extension and will be given the
opportunity to make submissions up to the end of the extended deadline.
To make the remaining language in Sec. 165.23 consistent with this
change, CBP revised the last sentence of (c)(1) by removing the
reference to the 200-day deadline and replacing it with a reference to
(c)(2), which sets forth the deadline, including the possibility for
CBP to extend the deadline at its discretion. It is important to note
that this discretionary extension of the deadline in Sec.
165.23(c)(2)(i) does not go beyond the statutory limit of 360 days (19
U.S.C. 1517(c)(1)) by which CBP is required to make a determination as
to evasion.
In addition, in newly created Sec. 165.23(c)(2)(i), CBP replaced
the clause ``except rebuttal information as permitted pursuant to the
next sentence herein'' with a reference to (c)(2)(ii), pointing to the
time frame and requirements for the submission of rebuttal information.
Lastly, in the newly created paragraph (c)(2)(ii), CBP removed the
phrase ``from the date of service of any factual information,'' keeping
only the phrase ``from the date of placement of any new factual
information'' because CBP's practice has been to use the date of
placement of new factual information on the administrative record as
the trigger for the 10-calendar-day period for providing rebuttal
information. Removing this phrase does not change the parties' rights
to provide rebuttal information and the time frame for submitting
rebuttal information.
In Sec. 165.23(d), CBP included language in the second sentence to
clarify that CBP intends to place a written summary of an oral
discussion between CBP and any party from whom CBP requests factual
information on the administrative record once an investigation has been
initiated, consistent with CBP's practice. It is important to note that
oral discussions between the alleger and CBP regarding flaws in an
allegation will not be placed on the administrative record. In
addition, CBP switched the order of the words ``confidential'' and
``business'' in the third sentence of paragraph (d) as the proper term
is ``business confidential information'' and it was erroneously written
in the interim regulations as ``confidential business information.''
In Sec. 165.24, CBP replaced the word ``notification'' in the
first sentence of paragraph (c) with ``notice'' as CBP serves an actual
notice of the decision to take interim measures. In addition, CBP
amended the last sentence of paragraph (c) stating that CBP will
provide the public version of the administrative record within 10
business days of issuing a notice of initiation of an investigation.
When the interim regulations were drafted, it seemed operationally
feasible to provide the public version of the administrative record and
the notice of initiation of investigation and interim measures on the
same date. However, due to TRLED's heavy workload, it has proven
difficult in many cases to provide the entire administrative record,
limited to public information, after day 90 of the investigation, on
the same day as the notice of initiation of investigation and interim
measures, as CBP needs time to prepare the public versions of documents
on the administrative record before providing them to the parties to
the investigation.
CBP made changes to Sec. 165.26(a)(1) and (b)(1) that are similar
to the changes discussed above for Sec. 165.23(c), providing CBP the
discretion to extend the deadlines for submitting written arguments and
responses to written arguments if the circumstances warrant. The need
to extend a deadline under Sec. 165.26(a) has frequently become
apparent, usually due to the verification process not being completed
in time. The purpose of such an extension is to grant an additional 60
days in those instances to complete the verification, give parties
adequate time to present written arguments, and for CBP to make a
determination as to evasion. In addition, CBP reorganized paragraph
(a)(1) and included language stating that an extension of the 230-
calendar-day deadline cannot exceed 300 calendar days after the
investigation was initiated, or 360 calendar days after the
investigation was initiated (in case of an extension of the deadline
for a determination as to evasion pursuant to Sec. 165.22(c)). This
change will provide CBP the additional time needed to make a sound
decision if circumstances warrant an extension. CBP also reorganized
paragraph (b)(1) to include language regarding CBP's discretion to
extend the 15-calendar-day deadline if CBP deems it necessary. Further,
CBP slightly revised Sec. 165.26(d)(2) to make the language read more
easily without changing the substance or meaning of the language.
In Sec. 165.28(c), CBP added the phrase ``in accordance with the
instructions received from the Department of Commerce'' at the end of
the sentence in order to align the regulatory language with the
statutory language in 19 U.S.C. 1517(d)(1)(D) and provide further
clarity.
In order to bring the EAPA regulations in line with the statutory
language in 19 U.S.C. 1517(c), CBP removed the word ``initial'' before
the word ``determination'' throughout Sec. Sec. 165.41, 165.45 and
165.46. CBP added ``as to evasion'' after ``determination'' in the
heading of subpart D, as well as in the section heading for Sec.
165.41 to distinguish a determination as to evasion from a
determination that is made during the administrative review. In
addition, CBP has removed the last sentence of Sec. 165.41(i) as it is
redundant and potentially confusing. The 30-business-day deadline for
filing a request for an administrative review is set forth in Sec.
165.41(d).
CBP made three changes in the introductory paragraph of Sec.
165.41(f). First, at the end of the first sentence, CBP added the
phrase ``in total (including exhibits but not table of contents or
table of authorities),'' which can also be found in Sec. 165.42, in
order to make the page limit requirements for a request for
administrative review
[[Page 19254]]
consistent with the requirements for a response to a request for
administrative review. Second, CBP replaced the word ``upon'' with ``on
for clarity. And third, CBP added a sentence to clarify that CBP will
reject a request for administrative review that does not meet the
requirements of paragraph (f) and will not consider it or place it on
the administrative record. Further, in Sec. 165.41(h), CBP removed the
language ``involving the same importer and merchandise'' as this is not
a correct statement as to the consolidation of requests for
administrative review. There is no limitation in practice as to the
possibility of consolidating separate requests for administrative
review that relate to one consolidated investigation, which may include
different importers and merchandise.
In addition, CBP added a sentence in Sec. 165.42 to clarify that
the original submitter of a request for administrative review is not
included as one of the parties who may submit a written response to the
filed request for review. It has never been CBP's intent that a party
who submitted a request for administrative review be able to respond to
its own submission, and CBP wants to confirm this intent in the final
regulation. CBP also replaced the word ``upon'' with ``on'' in Sec.
165.42 for clarity.
CBP amended Sec. 165.44 by adding two sentences at the end of the
section to clarify that CBP will only accept written submissions of
additional information in response to a request by CBP, and that
meetings or any other methods of unsolicited submission of additional
information during the administrative review are not permitted.
Throughout subpart D, only written submissions and additional written
information, and no other methods, such as oral discussions as allowed
in subpart C, will be accepted. See Sec. Sec. 165.41(f), 165.42, and
165.44.
Lastly, CBP made two minor changes in Sec. 165.46. In paragraph
(a), CBP replaced the reference to ``EAPA'' with a reference to
``TFTEA'' as it is more accurate. In addition, CBP replaced the term
``final administrative determination'' in Sec. 165.46(b) with
``administrative review'' to mirror the statutory language used in 19
U.S.C. 1517(f).
IV. Conclusion
Based on the analysis of the comments and further consideration,
CBP has decided to adopt as final the interim regulations published in
the Federal Register on August 22, 2016, as modified by the changes
based on public comments, and the technical changes and clarifications
discussed above.
V. Statutory and Regulatory Requirements
A. Executive Orders 13563 and 12866
Executive Orders 13563 (Improving Regulation and Regulatory Review)
and 12866 (Regulatory Planning and Review), as amended by Executive
Order 14094 (Modernizing Regulatory Review), direct agencies to assess
the costs and benefits of available regulatory alternatives, and if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health and safety effects, distributive impacts, and equity). Executive
Order 13563 emphasizes the importance of quantifying both costs and
benefits, reducing costs, harmonizing rules, and promoting flexibility.
The Office of Management and Budget (OMB) has not designated this
rule a significant regulatory action under section 3(f) of Executive
Order 12866, as amended by Executive Order 14094. Accordingly, OMB has
not reviewed it.
This rule has resulted in undiscounted costs to the public of
$20,008,985 to file allegations and communicate to CBP during the EAPA
investigation process and to file administrative review requests since
the IFR was published in 2016. The rule has resulted in $20,542,915 in
costs to CBP. Qualitative benefits of this rule include improved
enforcement of AD/CVD orders, increased transparency and predictability
in the processing of AD/CVD evasion allegations, and increased
communication with the public.
1. Purpose of the Rule
As mentioned above, on February 24, 2016, President Obama signed
into law the Trade Facilitation and Trade Enforcement Act of 2015,
which contains Title IV-Prevention of Evasion of Antidumping and
Countervailing Duty Orders (short title ``Enforce and Protect Act of
2015'' or ``EAPA'') (Pub. L. 114-125, 130 Stat. 122, 155, (Feb. 24,
2016) (19 U.S.C. 4301 note)). Section 421 of TFTEA requires that
regulations be promulgated where necessary to implement the provisions
of EAPA. Previous customs laws did not establish a set of specific
formal procedures for parties to submit allegations of antidumping or
countervailing duty (AD/CVD) evasion to CBP. EAPA provides CBP with new
and additional tools with which to combat the problem of AD/CVD evasion
with the establishment of a formal process for investigating
allegations of the evasion of AD/CVD orders. On August 22, 2016, CBP
published an interim final rule (IFR) in the Federal Register (81 FR
56477), which established a transparent process for making allegations,
investigating such allegations, and reporting the results of
investigations. This process provides access to information for the
parties to the investigation, giving CBP the opportunity to conduct
improved and more thorough investigations of each allegation and to
make informed AD/CVD evasion decisions. This final rule makes permanent
the interim regulations, including a change based on the previously
published technical correction, changes in light of the public comments
received in the comment period, as well as changes based on CBP's own
review of the interim regulations and the established investigation
process.
AD/CVD duties are an important trade measure that shields domestic
companies from unfair trade practices by overseas competitors. In
fiscal years 2020 and 2021, CBP assessed approximately $1.8 billion \5\
and $2.4 billion \6\ in antidumping and countervailing duties,
respectively. With so much money at stake, the incentives to circumvent
AD/CVD orders imposing these duties are high. The public benefits from
having a more formalized and clear AD/CVD evasion allegation process,
and such a process gives CBP the information it needs to be more
effective with AD/CVD enforcement. Furthermore, this rule fulfills the
legal mandate set forth in EAPA to establish a formal AD/CVD evasion
allegations process and an investigation program.
---------------------------------------------------------------------------
\5\ Source: CBP. CBP Trade and Travel Report. Available at
<a href="https://www.cbp.gov/sites/default/files/assets/documents/2021-Feb/CBP-FY2020-Trade-and-Travel-Report.pdf">https://www.cbp.gov/sites/default/files/assets/documents/2021-Feb/CBP-FY2020-Trade-and-Travel-Report.pdf</a>. Accessed June 15, 2022.
\6\ Source: CBP. CBP Trade and Travel Report. Available at
<a href="https://www.cbp.gov/sites/default/files/assets/documents/2022-Apr/FINAL%20FY2021_%20Trade%20and%20Travel%20Report%20%28508%20Compliant%29%20%28April%202022%29_0.pdf">https://www.cbp.gov/sites/default/files/assets/documents/2022-Apr/FINAL%20FY2021_%20Trade%20and%20Travel%20Report%20%28508%20Compliant%29%20%28April%202022%29_0.pdf</a>. Accessed June 15, 2022.
---------------------------------------------------------------------------
Background
The antidumping (AD) law provides relief to domestic industries
that have been materially injured or are threatened with material
injury by imported merchandise sold in the U.S. market at prices below
fair market value. The countervailing duty (CVD) law provides relief to
domestic industries that have been materially injured or are threatened
with material injury by imported merchandise sold in the U.S. market
that has been unfairly subsidized by a foreign government or
[[Page 19255]]
public entity. AD/CVD laws provide for additional import duties to be
placed on the dumped or subsidized imports to offset the unfair dumping
or subsidization of those imports.
Before the promulgation of interim final regulations, there was not
a formal procedure for interested parties and other Federal agencies to
submit allegations and evidence of AD/CVD evasion to CBP or a
requirement for CBP to undertake a formal investigation in response to
allegations of evasion. If an entity wanted to file an AD/CVD grievance
against another business it would have had to submit a grievance via
CBP's Trade Violation Reporting (TVR) system for general e-Allegations
or contact CBP by other means, and a CBP employee would assist it in
submitting its allegation. After the alleger provided all the required
information, CBP would examine the information and determine whether to
initiate an informal inquiry. There was not a formal process in place
for CBP to reach out to the entity initiating the allegation to inform
it of the results of its grievance and in many cases the alleger never
heard back from CBP after the allegation was made. There was also no
mechanism for the accused entity to know that it was under an e-
Allegation investigation nor opportunity for it to provide information
in its defense unless CBP decided to open a formal investigation. AD/
CVD grievances submitted via the ``Report Trade Violation'' option on
the TVR website are commonly referred to as ``e-Allegations.''
Costs
EAPA provides CBP with a formal process for conducting
administrative investigations involving possible evasion of AD/CVD
orders. CBP has established a new process under EAPA whereby CBP can
formally reach out to the alleger, the alleged evader, and other
interested parties with separate and distinct questionnaires in order
to acquire information that will be used to determine whether an
investigation is warranted and whether evasion is occurring or has
occurred.
Parties submitting EAPA allegations do so through the EAPA Portal,
which was launched in April 2021. New users are prompted to create an
account and provide their name and email address in the account
creation process. The creation of an account and submission of an
allegation via the EAPA Portal are estimated to take three minutes
(0.05 hours) and 12 minutes (0.20 hours) respectively, for a total time
burden of 15 minutes (0.25 hours) for a first EAPA allegation by a
user. Information provided during account creation is automatically
inserted into documents submitted to CBP through the EAPA Portal and
reduces the time burden to submit an EAPA allegation by three minutes
when compared to the time burden prior to the introduction of the EAPA
Portal. Users would also save the three minutes related to account
creation for each allegation submitted after the first when compared to
the previous method of having to submit the information again directly
into the EAPA Portal. Prior to the launching of the EAPA Portal (and
its EAPA-dedicated predecessor), EAPA allegations were submitted via a
dedicated link on CBP's TVR system to a document for the alleger to
complete and documents submitted as part of the investigation were sent
via email. The time it takes to enroll in the EAPA Portal is equal to
the time saved the first time the EAPA Portal is used. For repeat
users, there will be a three-minute time savings, but CBP lacks data to
estimate how often this takes place. To the extent the EAPA Portal is
used more than once by individual users, there will be a three-minute
savings per use. For the purpose of this analysis, CBP assumes the EAPA
Portal has no impact on time burdens.
CBP estimates that the submission of an EAPA allegation takes
approximately 15 minutes (0.25 hours).\7\ The statute requires a CBP
employee to advise and provide technical assistance to the alleger in
the filing of the EAPA allegation. In practice, this has eliminated the
necessity of a follow-up questionnaire to be filled out by the alleger.
---------------------------------------------------------------------------
\7\ Source: U.S. Customs and Border Protection. Supporting
Statement for Paperwork Reduction Act Submission: 1651-0131, e-
Allegations Submission. September 24, 2020. Available at <a href="https://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=202009-1651-006">https://www.reginfo.gov/public/do/PRAViewDocument?ref_nbr=202009-1651-006</a>.
Accessed November 24, 2020.
---------------------------------------------------------------------------
The alleged evader may receive a CBP Form 28 (CF-28) (Request for
Information) or an Initial Request for Information questionnaire and
other interested parties may receive an Initial Request for Information
questionnaire. Responding to CBP's request for information via these
instruments is optional; however, any party, except, e.g., a foreign
government, customer, or supplier, that chooses not to respond could be
subject to adverse inferences and the investigation may lead to an
unfavorable outcome for that party. The expected time burdens to
complete and submit a response to the CF-28 and Initial Request for
Information are approximately 60 and 90 hours, respectively.\8\ If CBP
determines that more information is required to bring an EAPA case to a
close, relevant parties will receive a Supplemental Request for
Information questionnaire. A Supplemental Request for Information
questionnaire is typically issued because a party did not fully answer
questions in the CF-28 or Initial Request for Information
questionnaire. The Supplemental Request for Information questionnaire
is estimated to have a time burden of 60 hours to complete and
submit.\9\
---------------------------------------------------------------------------
\8\ Source: Email correspondence with CBP's Enforcement
Operations Division on May 20, 2021.
\9\ Source: Email correspondence with CBP's Enforcement
Operations Division on May 20, 2021.
---------------------------------------------------------------------------
To estimate the cost to the industry from filing an EAPA allegation
and responding to the subsequent forms, CBP must first determine a
value of time for entities who would complete and file the forms. CBP
expects that, in most cases, these documents will be completed and
filed by an outside attorney due to the complex and specialized nature
of international trade law. CBP estimated the cost to companies to hire
an outside attorney to be $400 per hour in 2016 \10\ and adjusted the
wage to $466.38 in 2022 dollars.\11\ Each document's time burden is
then multiplied by the hourly cost to hire an outside attorney to
determine a total cost for each form. As shown in Table 1, the cost to
file a single EAPA allegation is monetized by multiplying the time
burden (.25 hours) and the hourly attorney costs ($466.38 in 2022
dollars) which results in a cost of $116.60 per filing. The estimated
cost to the industry for filing each document is shown in Table 1 along
with their corresponding time burdens.
---------------------------------------------------------------------------
\10\ Source: American Intellectual Property Law Association.
2017 Report of the Economic Survey. ``Billable Hours, Billing Rate,
Dollars Billed (Q29, Q30, Q27).'' June 2017.
\11\ CBP calculated the 2021 adjusted dollar amount using the
percent increase in the Annual Average GDP Price Deflator (2012=100)
between 2016 and 2021. The annual average GDP Price Deflator value
in 2016 = 105.74, the annual average GDP Price Deflator value in
2021 = 118.37, the percent increase was estimated to be around
11.19444% (118.37/105.74 = 1.119444 or 11.19444%). This percent
increase was applied to the 2016 estimated hourly billing rate of
$400 for external attorneys to estimate the 2021 hourly billing rate
of $447.78 for external attorneys. CBP assumes an annual growth rate
of 4.15% based on the prior year's change in the implicit price
deflator, published by the Bureau of Economic Analysis, to arrive at
the 2022 figure.
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This rule formalized the written argument process with the
implementation of timelines for submittal. There is no additional cost
to the public as a result of the new formal written argument process as
the public already had the ability to submit written
[[Page 19256]]
arguments to CBP, though not as part of a formal process.
This rule also established a process by which either the alleger or
the alleged evader may request an administrative review of a
determination as to evasion. The interested party has 30 business days
after the determination to request an administrative review. CBP
estimates an administrative review request takes 50 hours to complete
and submit.
Table 1--Time Burdens for Documents Submitted to CBP
------------------------------------------------------------------------
Time burden Cost per submission
Document submitted (in hours) (in 2022 dollars)
------------------------------------------------------------------------
e-Allegations.................... 0.25 $116.60
EAPA allegation.................. 0.25 116.60
CF-28 Response................... 60 27,982.80
Initial Request for Information 90 41,974.20
Response........................
Supplemental Request for 60 27,982.80
Information Response............
Administrative Review Request.... 50 23,319.00
------------------------------------------------------------------------
The total cost of this rule to the industry is fully monetized by
multiplying the cost per submission from Table 1 and the number of
submissions in Table 2 and then summing the results for each year. The
product of the cost per submission and the submissions by fiscal year
are shown in Table 3, as well as the summing of each year's
undiscounted costs.
Table 2--Submissions by Fiscal Year
----------------------------------------------------------------------------------------------------------------
Document submitted 2016 2017 2018 2019 2020 2021
----------------------------------------------------------------------------------------------------------------
e-Allegations (AD/CVD) *.......... 115 76 106 91 106 147
EAPA allegations.................. 2 29 57 127 149 127
CF-28 Response.................... 1 17 19 54 46 47
Initial Request for Information 2 27 18 66 42 98
Response.........................
Supplemental Request for 0 13 18 26 13 47
Information Response.............
Administrative Review Requests.... 0 0 2 2 14 21
-----------------------------------------------------------------------------
Total Filings Caused by Rule.. 5 86 114 275 264 340
----------------------------------------------------------------------------------------------------------------
Note: Submissions are sorted by the fiscal year the case was initiated, not by the year the individual document
was received.
* Note: e-Allegation (AD/CVD) submissions are not included in Total Filings Caused by Rule.
Table 3--Industry Costs Caused by Rule by Fiscal Year
[In undiscounted 2022 dollars]
--------------------------------------------------------------------------------------------------------------------------------------------------------
6 Year
Document submitted 2016 2017 2018 2019 2020 2021 Total
--------------------------------------------------------------------------------------------------------------------------------------------------------
e-Allegations (AD/CVD) *..................................... $13,408 $8,861 $12,359 $10,610 $12,359 $17,139 $74,737
EAPA allegations............................................. 233 3,381 6,646 14,808 17,373 14,808 57,248
CF-28 Response............................................... 27,983 475,708 531,673 1,511,071 1,287,209 1,315,192 5,148,835
Initial Request for Information Response..................... 83,948 1,133,303 755,536 2,770,297 1,762,916 4,113,472 10,619,473
Supplemental Request for Information Response................ 0 363,776 503,690 727,553 363,776 1,315,192 3,273,988
Administrative Review Requests............................... 0 0 46,638 46,638 326,466 489,699 909,441
------------------------------------------------------------------------------------------
Total Industry Costs Caused by Rule...................... 112,164 1,976,169 1,844,183 5,070,367 3,757,740 7,248,361 20,008,985
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Submissions are sorted by the fiscal year the case was initiated, not by the year the individual document was received.
* Note: e-Allegation (AD/CVD) submissions are not included in Total Industry Costs Caused by Rule.
CBP incurs costs throughout the EAPA investigative process and
created two new branches to handle the new filings and resulting
investigations. These two new branches are staffed with a total of 15
full-time equivalent (FTE) employees. The average CBP Trade and Revenue
fully-loaded salary in fiscal year 2022 was $228,254.61.\12\ This rule
created 15 full-time equivalent positions and multiplying this by the
FY 2022 wage rate results in $3,423,819 in undiscounted costs annually
since 2016. As shown in Table 5, the total costs to CBP for the fiscal
years 2016-2021 were $22,811,066 and $26,205,984 discounted at three
and seven percent, respectively.
---------------------------------------------------------------------------
\12\ CBP bases this wage on the FY 2022 salary, benefits,
premium pay, non-salary costs, and awards of the national average of
CBP Trade and Revenue positions, which is equal to a GS-12, Step 10.
Source: Email correspondence with CBP's Office of Finance on June
27, 2022.
---------------------------------------------------------------------------
In summary, this rule resulted in a cost to the public of
$18,337,822 to file EAPA allegations and respond to the questionnaires,
under the EAPA investigation process since the EAPA IFR was published
in 2016. In addition, CBP estimates that it cost the public $873,171 to
file administrative review requests. In total, this rule has resulted
in an undiscounted cost to the public of $19,210,993 and $20,542,915 to
CBP.
[[Page 19257]]
Table 4--Total Cost
[In undiscounted 2022 U.S. dollars]
----------------------------------------------------------------------------------------------------------------
Fiscal year Industry CBP Total
----------------------------------------------------------------------------------------------------------------
2016............................................................ $112,164 $3,423,819 $3,535,984
2017............................................................ 1,976,169 3,423,819 5,399,988
2018............................................................ 1,844,183 3,423,819 5,268,002
2019............................................................ 5,070,367 3,423,819 8,494,186
2020............................................................ 3,757,740 3,423,819 7,181,559
2021............................................................ 7,248,361 3,423,819 10,672,181
-----------------------------------------------
Total....................................................... 20,008,985 20,542,915 40,551,900
----------------------------------------------------------------------------------------------------------------
Table 5--Monetized Present Value and Annualized Costs by Fiscal Year
----------------------------------------------------------------------------------------------------------------
Industry CBP Total
-----------------------------------------------------------------------------------
Fiscal year 3% Discount 7% Discount 3% Discount 7% Discount 3% Discount 7% Discount
rate rate rate rate rate rate
----------------------------------------------------------------------------------------------------------------
2016........................ $133,930 $168,329 $4,088,219 $5,138,229 $4,222,149 $5,306,558
2017........................ 2,290,921 2,771,679 3,969,145 4,802,084 6,260,066 7,573,762
2018........................ 2,075,644 2,417,348 3,853,539 4,487,929 5,929,183 6,905,276
2019........................ 5,540,527 6,211,417 3,741,300 4,194,326 9,281,826 10,405,743
2020........................ 3,986,587 4,302,237 3,632,330 3,919,931 7,618,916 8,222,167
2021........................ 7,465,812 7,755,747 3,526,534 3,663,487 10,992,346 11,419,233
-----------------------------------------------------------------------------------
Total................... 21,493,421 23,626,756 22,811,066 26,205,984 44,304,487 49,832,740
-----------------------------------------------------------------------------------
Annualized Cost......... 3,226,048 3,086,842 3,423,819 3,423,819 6,649,867 6,510,661
----------------------------------------------------------------------------------------------------------------
4. Benefits
Domestic producers and legitimate importers benefit from better
enforcement as a result of this rule. In fiscal year 2021, the EAPA
process prevented the evasion of over $375 million in AD/CVD
duties.\13\ As domestic producers and legitimate importers grow more
accustomed to the EAPA process, it is likely that this number will
increase but CBP is unable to quantify this growth at this time.
---------------------------------------------------------------------------
\13\ Source: CBP. CBP Trade and Travel Report. Available at
<a href="https://www.cbp.gov/sites/default/files/assets/documents/2022-Apr/FINAL%20FY2021_%20Trade%20and%20Travel%20Report%20%28508%20Compliant%29%20%28April%202022%29_0.pdf">https://www.cbp.gov/sites/default/files/assets/documents/2022-Apr/FINAL%20FY2021_%20Trade%20and%20Travel%20Report%20%28508%20Compliant%29%20%28April%202022%29_0.pdf</a>. Accessed on June 16, 2022. Although
data is available for some years prior to fiscal year 2021, in light
of the newness of the EAPA program, CBP does not believe the data
can be used to extrapolate a trend.
---------------------------------------------------------------------------
Importers and domestic producers also benefit from increased
transparency and predictability in the processing of AD/CVD evasion
allegations because of this rule. Previously, an alleger submitted an
e-Allegation to CBP and CBP was not able to provide any subsequent
follow up to that alleger. This rule increased the transparency of the
allegation process and set clear time frames for all parties involved.
Furthermore, CBP increased communication with the public as a result of
this rule, specifically regarding technical assistance and advice on
how to properly file AD/CVD evasion allegations. This outreach could
result in faster processing and response times for grievances; however,
CBP is unable to quantify these benefits.
Additionally, this rule established a stronger working relationship
among CBP, the trade community, and foreign governments in the effort
to prevent evasion of AD/CVD duties. This rule gave CBP access to more
information from all affected parties, which helps CBP improve AD/CVD
enforcement. This rule helps prevent the circumvention of the AD/CVD
laws, which benefits domestic producers by shielding them from unfair
trade practices. Furthermore, to the extent that this rule reduces the
evasion of AD/CVD payments, the government will benefit through higher
AD/CVD revenue.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.), as amended
by the Small Business Regulatory Enforcement and Fairness Act of 1996,
requires agencies to prepare and make available to the public a
regulatory flexibility analysis that describes the effect of a proposed
rule on small entities (i.e., small businesses, small organizations,
and small governmental jurisdictions) when the agency is required to
publish a general notice of proposed rulemaking for a rule. Since a
general notice of proposed rulemaking was not necessary for the IFR,
CBP is not required to prepare a regulatory flexibility analysis for
this rule.
Paperwork Reduction Act
The Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3507(d))
requires that CBP consider the impact of paperwork and other
information collection burdens imposed on the public. An agency may not
conduct, and a person is not required to respond to, a collection of
information unless the collection of information displays a valid
control number assigned by the Office of Management and Budget (OMB).
The e-Allegations submission information collection, which is
assigned OMB control number: 1651-0131,\14\ is being amended to reflect
the change in burden hours caused by the EAPA requirements, and to
include the EAPA Portal as described above, and to reflect the
provisions of Sec. Sec. 165.5(a) and 165.23(a). To create an account
to access the EAPA Portal and submit an EAPA allegation, users provide
their first name, last name, and email address and the process of
account creation is estimated to take three minutes (0.05 hours). CBP
estimates that the creation of 250 EAPA Portal accounts annually will
add a total time burden of approximately 13 hours to the public.
[[Page 19258]]
CBP estimates that 149 EAPA allegations will be filed annually which is
an increase of 82 from what was previously approved by OMB. These
additional 82 EAPA allegations will result in an additional time burden
of approximately 13 hours to the public, resulting in a total time
burden of 30 hours to the public. In total, this rule resulted in an
overall increase of 26 burden hours from what is currently approved by
OMB. This increases the total burden hours for this collection from 289
to 315. The e-Allegations submission revisions described in this rule
have been submitted to OMB for review and approval in accordance with
the requirements of the Paperwork Reduction Act (44 U.S.C. 3507). OMB
control number 1651-0131 is being revised to reflect the change in
burden hours for EAPA respondents (i.e., those responding to the EAPA
submission requirements) and to confirm the burden hours for e-
Allegations as follows:
---------------------------------------------------------------------------
\14\ CBP notes that the TVR system continues to be used for
purposes other than EAPA.
---------------------------------------------------------------------------
E-Allegations
Estimated number of annual respondents: 1,088.
Estimated number of annual responses: 1,088.
Estimated time burden per response: 15 minutes (.25 hours).
Estimated total annual time burden: 272 hours.
EAPA Allegations
Estimated number of annual respondents: 149.
Estimated number of annual responses: 149.
Estimated time burden per response: 12 minutes (0.20 hours).
Estimated total annual time burden: 30 hours.
EAPA Portal Account Creation
Estimated number of annual respondents: 250.
Estimated number of annual responses: 250.
Estimated time burden per response: 3 minutes (0.05 hours).
Estimated total annual time burden: 13 hours.
Comments concerning the collections of information and the accuracy
of the estimated annual burden, and suggestions for reducing that
burden, should be submitted to OMB via <a href="https://www.reginfo.gov">https://www.reginfo.gov</a>.
Signing Authority
This document is being issued in accordance with 19 CFR 0.1(a)(1)
pertaining to the authority of the Secretary of the Treasury (or the
Secretary's delegate) to approve regulations related to certain customs
revenue functions.
Troy A. Miller, Senior Official Performing the Duties of the
Commissioner, having reviewed and approved this document, has delegated
the authority to electronically sign this document to the Director (or
Acting Director, if applicable) of the Regulations and Disclosure Law
Division of CBP, for purposes of publication in the Federal Register.
List of Subjects in 19 CFR Part 165
Administrative practice and procedure, Business and industry,
Imports.
Amendments to the Regulations
For the reasons given above, the IFR, which was published at 81 FR
56477 on August 22, 2016, adding part 165 to Chapter I of the CBP
regulations (19 CFR part 165), is adopted as final with the following
changes:
PART 165--INVESTIGATION OF CLAIMS OF EVASION OF ANTIDUMPING AND
COUNTERVAILING DUTIES
0
1. The general authority citation for part 165 continues to read as
follows:
Authority: 19 U.S.C. 66, 1481, 1484, 1508, 1517 (as added by
Pub. L. 114-125, 130 Stat. 122, 155 (19 U.S.C. 4301 note)), 1623,
1624, 1671, 1673.
0
2. Section 165.1 is amended by:
0
a. Revising the definition of ``Allegation'';
0
b. Adding the definition ``Business day'' in alphabetical order;
0
c. Revising the definition of ``Evade or evasion''; and
0
d. Revising the definition of ``TRLED''.
The addition and revisions read as follows:
Sec. 165.1 Definitions.
* * * * *
Allegation. The term ``allegation'' refers to a filing with CBP
under Sec. 165.11 by an interested party that alleges an act of
evasion of AD/CVD orders by an importer.
* * * * *
Business day. The term ``business day'' means a weekday (Monday
through Friday), excluding national holidays as specified in Sec.
101.6(a) of this chapter.
* * * * *
Evade or Evasion. The terms ``evade'' and ``evasion'' refer to the
entry of covered merchandise into the customs territory of the United
States for consumption by means of any document or electronically
transmitted data or information, written or oral statement, or act that
is material and false, or any omission that is material, and that
results in any cash deposit or other security or any amount of
applicable antidumping or countervailing duties being reduced or not
being applied with respect to the covered merchandise. Examples of
evasion include, but are not limited to, the transshipment,
misclassification, and/or undervaluation of covered merchandise.
* * * * *
TRLED. The term ``TRLED'' refers to the Trade Remedy Law
Enforcement Directorate, Office of Trade, that conducts the
investigation of alleged evasion under this part, and that was
established as required by section 411 of the Trade Facilitation and
Trade Enforcement Act of 2015 (TFTEA).
0
f. Section 165.3 is amended by adding a new paragraph (f) to read as
follows:
Sec. 165.3 Power of attorney.
* * * * *
(f) Return of submission. If a party has not provided proof of
execution of a power of attorney to CBP within five business days of an
agent's first submission on behalf of an interested party pursuant to
paragraph (e) of this section, or proof of authority to execute a power
of attorney, if requested by CBP, pursuant to paragraph (c) of this
section, CBP will reject the submission and will not consider or place
such submission on the administrative record.
0
4. Section 165.4 is amended by:
0
a. Revising the introductory text of paragraphs (a) and (b);
0
b. Revising paragraph (b)(3) and (e);
0
c. Adding a new paragraph (f).
The revisions and addition read as follows:
Sec. 165.4 Release of information provided by interested parties.
(a) Claim for business confidential treatment. Any interested party
that makes a submission to CBP in connection with an investigation
under this part, including for its initiation and administrative
review, may request that CBP treat any part of the submission as
business confidential information except for the information specified
in paragraph (c) of this section. If the requirements of this section
are satisfied and the information for which protection is sought
consists of trade secrets and/or commercial or financial information
obtained from any person, which is privileged or confidential in
accordance with 5 U.S.C. 552(b)(4), CBP will grant business
confidential treatment and issue an administrative protective order
pursuant to paragraph (f) of this section. All documents and
[[Page 19259]]
communications that are submitted to CBP after notice of initiation of
an investigation must be served on all parties to the investigation by
the submitting entity (for business confidential documents, a public
version must be served as well, in accordance with paragraph (a)(2) of
this section).
* * * * *
(b) Nonconforming submissions. CBP will reject a submission that
includes a request for business confidential treatment but does not
meet the requirements of paragraph (a) of this section and will not
consider or place such submission on the administrative record unless
the submitting interested party takes any of the actions in paragraph
(b)(2) of this section within the timeframe specified in paragraph
(b)(2) of this section.
* * * * *
(3) Effects of rejection. If the submitting interested party does
not take any of the actions in accordance with paragraph (b)(2) of this
section, CBP will not consider the rejected submission, not place such
submission on the administrative record, and, if applicable, adverse
inferences may be drawn pursuant to Sec. 165.6.
* * * * *
(e) Information placed on the record by CBP. Any information that
CBP places on the administrative record, when obtained other than from
an interested party subject to the requirements of this section, will
include a public summary of the business confidential information as
described in paragraph (a)(2) of this section, when applicable. If CBP
places information on the record from parties who are not already
subject to the requirements of this section, CBP will require these
parties to conform to the requirements of this section and Sec. 165.5
when filing submissions. Otherwise, such submissions may be treated as
nonconforming submissions pursuant to paragraph (b) of this section
and/or Sec. 165.5(b)(4).
(f) Administrative protective order. In each investigation where
CBP has granted a request by an interested party to treat any part of
its submission as business confidential information, CBP will issue an
administrative protective order which will contain terms to allow the
representatives of parties to the investigation to access the business
confidential information.
0
5. Section 165.5 is amended by:
0
a. Revising paragraph (b)(2) introductory text;
0
b. Removing in paragraphs (b)(2)(ii) and (iii) the reference ``19 CFR''
and adding in its place ``Sec. '';
0
c. Adding a new paragraph (b)(4); and
0
d. Revising paragraphs (c)(1) and (2).
The revisions and addition read as follows:
Sec. 165.5 Obtaining and submitting information.
* * * * *
(b) * * *
(2) Certifications. Every written submission made to CBP by an
interested party or requested by CBP from any other party pursuant to
Sec. Sec. 165.4 and 165.5 must be accompanied by the following
certifications from the person making the submission:
* * * * *
(4) Nonconforming submissions. CBP will reject a submission that
does not meet the requirements of paragraph (b) of this section and
will not consider it or place it on the administrative record.
(c) * * *
(1) Requests for extensions. CBP may, for good cause, extend any
regulatory time limit, or any deadline for the submission of
information requested by CBP, if a party requests an extension in a
separate, stand-alone submission and states the reasons for the
request. Such requests must be submitted no less than three business
days before the time limit expires unless there are extraordinary
circumstances. An extraordinary circumstance is an unexpected event
that could not have been prevented even if reasonable measures had been
taken by the requester. It is within CBP's reasonable discretion to
determine what constitutes extraordinary circumstances, what
constitutes good cause, and to grant or deny a request for an
extension.
(2) Rejection of untimely submissions. If a submission is untimely
filed, CBP will not consider it or place it on the administrative
record and adverse inferences may be applied, if applicable.
0
6. Section 165.6 is amended by revising paragraph (b) to read as
follows:
Sec. 165.6 Adverse inferences.
* * * * *
(b) Adverse inferences described. An adverse inference used under
paragraph (a) may include reliance on information derived from an
allegation, a prior determination in another CBP investigation,
proceeding, or action that involves evasion of AD/CVD orders, or any
other available information on the administrative record.
* * * * *
0
7. Section 165.12 is amended by revising paragraph (b) to read as
follows:
Sec. 165.12 Receipt of allegations.
* * * * *
(b) Withdrawal. An allegation may be withdrawn by the party that
filed it if that party submits a request to withdraw the allegation to
the designated email address specified by CBP or through any other
method approved or designated by CBP.
0
8. Section 165.13 is amended by revising paragraphs (c) and (d) to read
as follows:
Sec. 165.13 Consolidation of allegations.
* * * * *
(c) Notice. Notice of consolidation will be promptly transmitted to
all parties to the investigation if consolidation occurs at a point in
the investigation after which they have already been notified of the
ongoing investigation. Otherwise, parties will be notified no later
than five business days after day 90 of the investigation.
(d) Service requirements for other parties to the investigation.
Upon notification of consolidation, parties to the consolidated
investigation must serve on the newly added parties to the
investigation, via an email message or through any other method
approved or designated by CBP, public documents and the public versions
of any documents that were previously served on parties to the
unconsolidated investigation. Service must take place within five
business days of the notice of consolidation.
0
9. Section 165.14 is amended by revising paragraph (a) to read as
follows:
Sec. 165.14 Other Federal agency requests for investigation.
(a) Requests for investigations. Any other Federal agency,
including but not limited to the Department of Commerce or the United
States International Trade Commission, may request an investigation
under this part. CBP will initiate an investigation if the Federal
agency has provided information that reasonably suggests that an
importer has entered covered merchandise into the customs territory of
the United States through evasion, unless the agency submits a request
to withdraw to the designated email address specified by CBP or through
any other method approved or designated by CBP.
* * * * *
0
10. Section 165.15 is amended by revising paragraphs (d)(1) and (e) to
read as follows:
Sec. 165.15 Initiation of investigations.
* * * * *
(d) * * *
(1) In general. CBP will issue a notice of its decision to initiate
an
[[Page 19260]]
investigation to all parties to the investigation no later than five
business days after day 90 of the investigation, and the actual date of
initiation of the investigation will be specified therein. In cases
where interim measures are taken pursuant to Sec. 165.24, notice to
all parties to the investigation will occur no later than five business
days after day 90 of the investigation.
* * * * *
(e) Record of the investigation. If an investigation is initiated
pursuant to subpart B of this part, then the information considered by
CBP prior to initiation will be part of the administrative record
pursuant to Sec. 165.21. Any documents submitted prior to the issuance
of a notice of CBP's decision to initiate an investigation will be
served by CBP on the parties to the investigation, regardless of who
submitted those documents.
0
11. Section 165.16 is amended by revising paragraph (d).
Sec. 165.16 Referrals to Department of Commerce.
* * * * *
(d) Effect on investigation. The time period required for any
referral and determination by the Department of Commerce will not be
counted toward the deadlines for CBP to decide on whether to initiate
an investigation under Sec. 165.15, whether to take interim measures
under Sec. 165.24, or the deadline to issue a determination as to
evasion under Sec. 165.27.
* * * * *
0
12. Section 165.22 is amended by:
0
a. In paragraph (a) removing the words ``not later'' and adding in
their place the words ``no later'';
0
b. Revising paragraph (b);
0
c. In paragraph (d), removing the words ``not later'' and adding in
their place the words ``no later''; and
0
c. In paragraph (d), removing the word ``Notification'' and adding in
its place the word ``Notice''.
The revision reads as follows:
Sec. 165.22 Time for investigations.
* * * * *
(b) Time for determination with consolidated allegations. If CBP
consolidates multiple allegations under Sec. 165.13 into a single
investigation under Sec. 165.15, the date of receipt of the first
properly filed allegation will be used for the purposes of the
requirement under paragraph (a) of this section with respect to the
timing of the initiation of the investigation.
* * * * *
0
13. Section 165.23 is amended by:
0
a. Revising paragraph (b);
0
b. Revising the last sentence of paragraph (c)(1);
0
c. Revising paragraph (c)(2); and
0
d. Revising paragraph (d).
The revisions read as follows:
Sec. 165.23 Submission of factual information.
* * * * *
(b) Voluntary submission of factual information. The parties to the
investigation may submit additional information in order to support the
allegation of evasion or to negate or clarify the allegation of
evasion.
(c) * * *
(1) * * * If CBP places new factual information on the
administrative record on or after the deadline for submissions of new
factual information pursuant to paragraph (c)(2) of this section (or if
such information is placed on the record at CBP's request), the parties
to the investigation will have 10 calendar days to provide rebuttal
information to the new factual information.
(2) Voluntary submission of factual information. (i) Factual
information voluntarily submitted to CBP pursuant to paragraph (b) of
this section must be submitted no later than 200 calendar days after
CBP initiated the investigation under Sec. 165.15, unless this
deadline is officially extended by CBP solely at CBP's discretion. If
CBP extends this deadline, parties to the investigation will be
notified and may make submissions up through the end of the extended
deadline. Voluntary submissions made after the 200th calendar day after
initiation of the investigation, or after the extended deadline, will
not be considered or placed on the administrative record, except
rebuttal information as provided in paragraph (c)(2)(ii) of this
section. The public version must also be served via an email message or
through any other method approved or designated by CBP on the parties
to the investigation.
(ii) Parties to the investigation will have 10 calendar days from
the date of placement of any new factual information on the record to
provide rebuttal information to that new factual information, if the
information being rebutted was placed on the administrative record no
later than 200 calendar days after CBP initiated the investigation
under Sec. 165.15, or no later than the extended deadline.
(d) Oral discussions. Notwithstanding the time limits in paragraph
(c) of this section, CBP may request oral discussion either in-person
or by teleconference. CBP will memorialize such discussions with a
written summary that identifies who participated and the topic of
discussion, and place the written summary on the administrative record.
In the event that business confidential information is included in the
written summary, CBP will also place a public version on the
administrative record.
0
14. Section Sec. 165.24 is amended by revising paragraph (c) to read
as follows:
Sec. 165.24 Interim measures.
* * * * *
(c) Notice. If CBP decides that there is reasonable suspicion under
paragraph (a) of this section, CBP will issue a notice of this decision
to the parties to the investigation within five business days after
taking interim measures. CBP will also provide parties to the
investigation with a public version of the administrative record within
10 business days of the issuance of a notice of initiation of an
investigation.
0
15. Section 165.25 is amended by:
0
a. Revising paragraph (b); and
0
b. Adding new paragraphs (c) and (d).
The revision and additions read as follows:
Sec. 165.25 Verifications of information.
* * * * *
(b) CBP may conduct verifications before and after the deadline for
the voluntary submission of new factual information as referenced in
Sec. 165.23. The general purpose of the verification is to verify the
accuracy of the information already placed on the administrative
record.
(c) CBP will place a report about the verification, i.e., the
verification report, on the administrative record. CBP will require the
party that underwent the verification to place verification exhibits on
the administrative record. Verification exhibits will generally contain
information compiled and verified by CBP at CBP's discretion during the
verification. In accordance with Sec. 165.4, both CBP and the party
that underwent the verification will provide public versions of their
verification documents, which will be served on all parties to the
investigation. CBP will not accept voluntary submissions of new factual
information at the verification after the deadline for voluntary
submission of new factual information, as referenced in Sec. 165.23.
Parties to the investigation cannot submit rebuttal information to
either CBP's verification report or the verification exhibits. Parties
to the investigation may submit to CBP written arguments in relation to
the verification report and/or its exhibits in accordance with Sec.
165.26.
(d) If CBP determines that information discovered during a
verification is
[[Page 19261]]
relevant to the investigation and constitutes new factual information,
CBP will place it on the administrative record separately, in
accordance with Sec. 165.23, and allow parties to the investigation to
submit rebuttal information.
0
16. Section 165.26 is amended by revising paragraphs (a), (b), (c), and
(d)(2) to read as follows:
Sec. 165.26 Written arguments.
* * * * *
(a) Written arguments. Parties to the investigation:
(1) May submit to CBP written arguments that contain all arguments
that are relevant to the determination as to evasion and based solely
upon facts already on the administrative record in that proceeding. All
written arguments must be:
(i) Submitted to the designated email address specified by CBP or
through any other method approved or designated by CBP;
(ii) Submitted no later than 230 calendar days after the
investigation was initiated pursuant to Sec. 165.15, unless extended
by CBP solely at CBP's discretion but no later than 300 calendar days
after the investigation was initiated, or 360 calendar days after the
investigation was initiated if the deadline for a determination as to
evasion has been extended by CBP pursuant to Sec. 165.22(c); and
(2) Must serve a public version of the written arguments prepared
in accordance with Sec. 165.4 on the other parties to the
investigation by an email message or through any other method approved
or designated by CBP the same day it is filed with CBP.
(b) Responses to the written arguments. Parties to the
investigation:
(1) May submit to CBP a response to a written argument filed by
another party to the investigation, fulfilling the following
requirements:
(i) The response must be in writing and submitted to the designated
email address specified by CBP, or through any other method approved or
designated by CBP, no later than 15 calendar days after the written
argument was filed with CBP, unless extended by CBP solely at CBP's
discretion; and
(ii) The response must be limited to the issues raised in the
written argument; any portion of a response that is outside the scope
of the issues raised in the written argument will not be considered;
and
(2) Must serve a public version of the response prepared in
accordance with Sec. 165.4 on the other parties to the investigation
by an email message or through any other method approved or designated
by CBP the same day it is filed with CBP.
(c) Written arguments submitted upon request. Notwithstanding
paragraphs (a) and (b) of this section, CBP may request written
arguments on any issue from the parties to the investigation at any
time during an investigation.
(d) * * *
(2) A concise summary of the argument or response to the argument;
* * * * *
0
17. Section 165.28 is amended by revising paragraph (c) to read as
follows:
Sec. 165.28 Assessments of duties owed; other actions.
* * * * *
(c) Cash deposits and duty assessment. CBP will require the posting
of cash deposits and assess duties on entries of covered merchandise
subject to its affirmative determination of evasion in accordance with
the instructions received from the Department of Commerce.
0
18. Revise the heading to subpart D to read as follows:
Subpart D--Administrative Review of Determinations as to Evasion
0
19. Section 165.41 is amended by:
0
a. Removing the word ``initial'' in the section heading and each time
it appears in the section;
0
b. Revising the introductory text of paragraph (f);
0
c. Revising paragraph (h); and
0
d. Removing the last sentence of paragraph (i).
The revisions read as follows:
Sec. 165.41 Filing a request for review of the determination as to
evasion.
* * * * *
(f) Content. Each request for review must be based solely on the
facts on the administrative record in the proceeding, in writing, and
may not exceed 30 pages in total (including exhibits but not table of
contents or table of authorities). It must be double-spaced with
headings and footnotes single spaced, margins one inch on all four
sides, and 12-point font Times New Roman. If it exceeds 10 pages, it
must include a table of contents and a table of cited authorities. CBP
will reject a request for review that does not meet the requirements of
this paragraph, and will not consider it or place it on the
administrative record. Each request for review must set forth the
following:
* * * * *
(h) Consolidation of requests for administrative review. Multiple
requests under the same allegation control number assigned by CBP may
be consolidated into a single administrative review matter.
* * * * *
0
20. Revise Sec. 165.42 to read as follows:
Sec. 165.42 Responses to requests for administrative review.
Any party to the investigation, regardless of whether it submitted
a request for administrative review, may submit a written response to
the filed request(s) for review. A party who submitted a request for
administrative review may not respond to its own submission. Each
written response may not exceed 30 pages in total (including exhibits
but not table of contents or table of authorities) and must follow the
requirements in Sec. 165.41(f). The written responses to the
request(s) for review must be limited to the issues raised in the
request(s) for review and must be based solely on the facts already on
the administrative record in that proceeding. The responses must be
filed in a manner prescribed by CBP no later than 10 business days from
the commencement of the administrative review. All responses must be
accompanied by the certifications provided for in Sec. 165.5. Each
party seeking business confidential treatment must comply with the
requirements in Sec. 165.4. The public version of the response(s) to
the request(s) for review must be provided to the other parties to the
investigation via an email message or through any other method approved
or designated by CBP.
0
21. Revise Sec. 165.44 to read as follows:
Sec. 165.44 Additional information.
CBP may request additional written information from the parties to
the investigation at any time during the review process. The parties
who provide the requested additional information must provide a public
version to the other parties to the investigation via an email message
or through any other method approved or designated by CBP. The
submission of additional information requested by CBP must comply with
requirements for release of information in Sec. 165.4. CBP may apply
an adverse inference as stated in Sec. 165.6 if the additional
information requested under this section is not provided. CBP will only
accept written submissions of additional information in response to a
request by CBP. No meetings or any other methods of unsolicited
submission of additional information are permitted during the
administrative review.
0
22. Revise Sec. 165.45 to read as follows:
[[Page 19262]]
Sec. 165.45 Standard for administrative review.
CBP will apply a de novo standard of review and will render a
determination appropriate under law according to the specific facts and
circumstances on the record. For that purpose, CBP will review the
entire administrative record upon which the determination as to evasion
was made, the timely and properly filed request(s) for review and
responses, and any additional information that was received in response
to a request by CBP pursuant to Sec. 165.44. The administrative review
will be completed within 60 business days of the commencement of the
review.
0
23. Section Sec. 165.46 is amended by:
0
a. Removing in paragraph (a) the acronym ``EAPA'' and adding in its
place the acronym ``TFTEA''; and
0
b. Revising paragraph (b).
The revision reads as follows:
Sec. 165.46 Final administrative determination.
* * * * *
(b) Effect of the administrative review. If the administrative
review affirms the determination as to evasion, then no further CBP
action is needed. If the administrative review reverses the
determination as to evasion, then CBP will take appropriate actions
consistent with the administrative review.
Robert F. Altneu,
Director, Regulations & Disclosure Law Division, Regulations & Rulings,
Office of Trade, U.S. Customs and Border Protection.
Aviva R. Aron-Dine,
Acting Assistant Secretary of the Treasury for Tax Policy.
[FR Doc. 2024-04713 Filed 3-15-24; 8:45 am]
BILLING CODE 9111-14-P
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</html>Indexed from Federal Register on March 18, 2024.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.