Court Invalidates Presidential Action
Assessing Special Duties on Certain
Derivative Steel and Aluminum Products

April 7, 2021

On April 5, 2021, in a 2-1 decision, a three judge panel for the United States Court of International Trade (USCIT) issued a decision in PrimeSource Building Products Inc., v. United States, Slip Op. No. 21-36, invalidating President Trump’s Presidential Proclamation 9980 (January 24, 2020), which imposed a 25% duty on certain imported articles made of steel, including steel nails, and a 10% duty on certain imported articles made of aluminum.  For a list of affected products see our previous newsletter published January 28, 2020.

In its decision, the court noted that PrimeSource was entitled to judgment as a matter of law, as “the action taken by Proclamation 9980 to adjust imports of derivatives was not implemented during the 105-day time period set forth in § 1862(c)(1), if that time period is considered to have commenced upon the President’s receipt of the Steel Report.” In the litigation, the government declined to “come forward” with any evidence of a dispute of material fact and did not file an answer to plaintiff’s complaint or amended complaint (as such, the facts were construed in favor of the plaintiff). The court concluded that the government waived any argument that Proclamation 9980 was issued within the 105-day time period beginning with the President’s receipt of a report qualifying under Section 232(b)(3)(A). Having waived any argument that Proclamation 9980 was issued within the 105-day time period beginning with the President’s receipt of a report qualifying under Section 232(b)(3)(A), the court granted summary judgment in favor of PrimeSource, sua sponte (“on its own”). With regard to relief on the claim, the court declared:

[W]e will declare Proclamation 9980 invalid as contrary to law and, on that basis, direct that the entries affected by this litigation be liquidated without the assessment of duties pursuant to Proclamation 9980, with refund of any deposits for such duty liability that may have been collected pursuant to Proclamation 9980. Also, should any entries of PrimeSource’s merchandise at issue in this litigation have liquidated with the assessment of 25% duties pursuant to Proclamation 9980, PrimeSource is entitled to reliquidation of those entries and a refund of any duties deposited or paid, with interest as provided by law.

It is too soon to determine if the government will appeal this decision by the USCIT. The government has 60 days to file an appeal. Importers, however, should not wait to take action for a final decision or the expiration of the statutory appeal period. Unless you have filed a companion case, without taking some action you may not receive a liquidation without the assessment of duties. It may be possible that CBP will voluntarily liquidate all entries without the assessment of the 232 duties for all derivative steel products, but you cannot count on that.

What can you do? You can file a Post Summary Correction (PSC), removing the 232 duties from the entry for the covered derivative steel and aluminum products, explaining that the assessment is unlawful under PrimeSource Building Products Inc. You must, however, watch carefully, as CBP is not obligated to process a PSC. Also, if you have liquidated entries, you will likely need to file protests asserting (now) that the collection of duties was unlawful and you are entitled to a refund. You will have a limited time period for filing the protest (180 days from the date of liquidation), as CBP may not voluntarily reliquidate the entries within the 90-day time period allowed by 19 USC §1501. You may have other avenues to seek refunds, and we encourage you to seek appropriate legal counsel to explore your opportunities for recovery of these duties.

If you have questions about Section 232 duties or other customs matters, contact George R. Tuttle, III at geo@tuttlelaw.com or at 415-986-8780.

 

The information in this article is general in nature and is not intended to constitute legal advice or to create an attorney-client relationship with respect to any event or occurrence and may not be considered as such.

Copyright © 2021 by Tuttle Law Offices. 
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Information has been obtained from sources believed to be reliable.  However, because of the possibility of human or mechanical error by our offices or by others, we do not guarantee the accuracy, adequacy, or completeness of any information and are not responsible for any errors, omissions, or for the results obtained from the use of such information.

 

 

 

 

 

 

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