Deemed Liquidation: Whose Rate is this Anyway
690 FORDHAM INTERNATIONAL LA WJOURNAL [Vol. 10:689
Fordham International Law Journal
Copyright c 1986 by the authors. Fordham International Law Journal is produced by The
Berkeley Electronic Press (bepress). http://ir.lawnet.fordham.edu/ilj
Deemed Liquidation: Whose Rate is this
Lawrence M. Segan
This Note argues that there are many reasons to believe that Congress did intend section 504
to operate as a penalty on Customs for failure to liquidate in a timely manner. Part I discusses
the process by which imports are liquidated and how section 504 has been implemented. Part II
examines how the CIT has interpreted the statute. Part III argues that the practice of Customs
and the CIT’s interpretation conflict with the congressional intent behind section 504. Finally, this
Note concludes that in order to conform to Congress’ intent, the importer’s asserted rate should be
given effect in deemed liquidation situations.
DEEMED LIQUIDATION: WHOSE RATE IS THIS ANYWAY?
As required by section 504 of the Tariff Act of 19301
(section 504) the United States Customs Service (Customs) must
liquidate 2 entries 3 of imported merchandise within one year of
the time of entry.4 An entry not liquidated within one year
"shall be deemed liquidated at the rate of duty, value, quantity,
and amount of duties asserted at the time of entry by the
importer of record."' 5 Despite the statute's apparent clarity, in
actual practice the rate of these liquidations by operation of
law, or "deemed liquidations," is not necessarily the rate
asserted by the importer. Rather, the rate used for deemed
liquidations is more likely to be a rate insisted upon by Customs.
Recent cases indicate that the United States Court of
International Trade (CIT) has approved Customs' practice. 6 Relying
on the legislative history of section 504, the Court has
reasoned that Congress could not have intended to impose a
penalty on Customs for failure to liquidate in a timely manner.7
This Note argues that there are many reasons to believe
that Congress did intend section 504 to operate as a penalty on
Customs for failure to liquidate in a timely manner. Part I
discusses the process by which imports are liquidated and how
section 504 has been implemented by Customs. Part II
examines how the CIT has interpreted the statute. Part III argues
that the practice of Customs and the CIT's interpretation
conflict with the congressional intent behind section 504. Finally,
this Note concludes that in order to conform to Congress'
intent, the importer's asserted rate should be given effect in
deemed liquidation situations.
I. LIQUIDATION OF ENTRIES AND INTERPRETATION OF
SECTION 504 BY THE CUSTOMS SERVICE
A. The Liquidation Process
Customs is required by statute to appraise and classify
merchandise, determine the amount of duties to be paid,
liquidate the entry, and give notice of such liquidation.' The actual
process by which this occurs has several basic steps. The
importer, usually acting through his Customs broker, is required
to file an entry within five days after arrival of the
merchandise. 9 If the information on the entry' 0 is acceptable to
Customs officials," the merchandise will be released to the
importer's custody and a copy of the entry documentation
returned to the importer.' 2 Within ten days after filing the entry
the importer must file the entry summary, 3 which is a slightly
more detailed version of the entry, with the original entry
doc8. 19 U.S.C. § 1500 (1982). The Customs Courts Act of 1970 merged all
decisions regarding value, quantity, classification and amount of duties into a single
action, the liquidation. Pub. L. No. 91-271, § 207, 84 Stat. 274, 284 (codified at 19
U.S.C. § 1514). Liquidation is the basis for protest of a Customs' decision. Id.
Denial of protest by Customs is grounds for invoking the jurisdiction of the Court of
International Trade (CIT). 19 U.S.C. § 1514(a); 28 U.S.C. § 1581(a).
9. 19 C.F.R. § 141.5 (five day requirement for filing of entry).
10. Customs Form 3461 is normally used for entries. 19 C.F.R. § 142.3(a)(
Required information includes, among other things, a description of the
merchandise, quantity, value, and tariff classification.
11. See 19 C.F.R. § 152 (classification and appraisement of merchandise).
12. 19 C.F.R. § 142.16(a); see R. STORM, supra note 2, § 2.5 (1986).
13. "'Entry summary' means any other documentation [other than the entry
documentation] necessary to enable Customs to assess duties, and collect statistics
on imported merchandise, and determine whether other requirements of law or
regulation are met." 19 C.F.R. § 141.0a(b). This definition is derived from 19 U.S.C.
§ 1484, which requires that the importer of record file within 10 days after the entry
"such other documentation as is necessary to enable such officer to assess properly
the duties on the merchandise, collect accurate statistics with respect to the
merchandise, and determine whether any other applicable requirement of law ... is met." 19
U.S.C. § 1484(a)(l)(B). Customs Form 7501 is normally used for the entry summary.
19 C.F.R. § 142.11(a).
umentation attached.14 This second set of documents is
reviewed by Customs officials, usually within the one year
required by section 504, and liquidation, the final assessment of
duties, occurs.' 5 Notice of liquidation is posted in the
customhouse and a courtesy notice is typically sent to the importer.' 6
If the importer disagrees with the determination of the
amount of duties owed, he may file a protest with Customs.' 7
Protest must be filed within 90 days after, but not before,
liquidation.' 8 If the protest is denied, then at that point all
administrative remedies are considered exhausted and the importer
may appeal Customs' decision to the CIT.' 9
When Customs fails to liquidate the entry within one year,
the entry is "deemed liquidated" pursuant to section 504 at
the rate asserted by the importer at the time of entry.20
However, under its interpretation of the statute, Customs often
disregards the importer's assertion in deemed liquidations.
14. 19 C.F.R. § 142.12(b) (ten day requirement for filing of entry summary).
15. See R. STURM, supra note 2, § 8.
16. Under the Customs regulations, bulletin notice of liquidation "shall be
posted for the information of importers in a conspicuous place in the customhouse at
the port of entry .... " 19 C.F.R. § 159.9(b). In addition, Customs will endeavor to
provide a courtesy notice of liquidation to importers or their agents. 19 C.F.R.
17. 19 U.S.C. § 1514.
19. 28 U.S.C. § 1581.
20. 19 U.S.C. § 1504. The full text of the statute follows:
§ 1504. Limitation on liquidation
Except as provided in subsection (b) of this section, an entry of merchandise
not liquidated within one year from:
) the date of entry of such merchandise;
) the date of the final withdrawal of all such merchandise covered by
a warehouse entry; or
) the date of withdrawal from warehouse of such merchandise for
consumption where ... duties may be deposited after the filing of an entry
or withdrawal from warehouse;
shall be deemed liquidated at the rate of duty, value, quantity, and amount
of duties asserted at the time of entry by the importer of record.
Notwithstanding section 1500(e) of this title, notice of liquidation need not be given
of any entry deemed liquidated.
The Secretary may extend the period in which to liquidate an entry by giving
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B. Customs' Interpretation of Section 504
In actual practice, what rate is asserted and when it is
asserted is largely determined by Customs. Because of its
authority to review entries prior to acceptance 2 ' and reject a form
which appears to be erroneous 2 2 Customs officials may refuse
to permit entry unless a rate acceptable to Customs is shown
on the entry documentation.2 3
Customs' authority to determine the rate asserted by the
importer and to decide when it was asserted was further
expanded by the Customs regulations issued pursuant to
section 504(a). 24 In 1979, before promulgating the
regulanotice of such extension to the importer of record in such form and manner
as the Secretary shall prescribe in regulations,
) information needed for the proper appraisement or classification of
the merchandise is not available to the appropriate customs officer;
) liquidation is suspended as required by statute or court order; or
) the importer of record requests such extension and shows good
(c) Notice of suspension
If the liquidation of any entry is suspended, the Secretary shall, by
regulation, require that notice of such suspension be provided to the importer of
record concerned and to any authorized agent and surety of such importer
Any entry of merchandise not liquidated at the expiration of four years from
the applicable date specified in subsection (a) of this section, shall be
deemed liquidated at the rate of duty, value, quantity, and amount of duty
asserted at the time of entry by the importer of record, unless liquidation
continues to be suspended as required by statute or court order. When
such a suspension of liquidation is removed, the entry shall be liquidated
within 90 days therefrom.
21. 19 C.F.R. § 141.64. "Entry and entry summary documentation shall be
reviewed before acceptance to ensure that all entry and statistical requirements are
complied with and that the indicated values and rates of duty appear to be correct."
tions, Customs issued a bulletin interpreting the new statute. 5
According to this bulletin, deemed liquidations were to occur
at the rate appearing in the entry summary26 rather than the
entry. 7 The bulletin also redefined the "time of entry."2 8
Although the relevant statutes and regulations clearly define
the time of entry as the time of release of the merchandise, 9
Customs decided that for purposes of deemed liquidation, the
time of entry would be the time of filing the entry summary.30
As a result, the regulations now state that deemed liquidations
are to occur at the rate "asserted by the importer at the time of
filing an entry summary for consumption in proper form, with
estimated duties attached .... In actual practice, therefore,
Customs has two opportunities to review and reject the rate
asserted by the importer: first upon entry, and again upon
filing the entry summary.
The language of section 504 gives rise to three possible
interpretations. One reading, favorable to importers, would
25. T.D. 79-221, 13 Cust. B. & Dec. 641 (1979).
26. See supra note 13 and accompanying text.
27. See T.D. 79-221, 13 Cust. B. & Dec. at 685-86. As stated in the Customs
[P]roposed sections 159.11(a) and 159.12(0 have been revised to reflect
that an entry deemed liquidated by operation of law shall be deemed
liquidated at the rate of duty, value, quantity, and amount of duties asserted at
the time of filing the entry summary for consumption in proper form, with
estimated duties attached ....
Id. at 685; see supra note 3.
29. Under 19 U.S.C. § 1484 the importer of record shall make entry "by filing
with the appropriate customs officer such documentation as is necessary to enable
such officer to determine whether the merchandisemay be releasedfrom customs custody ......
19 U.S.C. § 1484(a)(
)(A) (emphasis added). The Customs regulations similarly
refer to the release of the merchandise. 19 C.F.R. § 141.0a(a); see supra note 3. Under
the regulations, "[wihen the entry documentation is filed in proper form without an
entry summary, the 'time of entry' shall be: (
) The time the appropriate Customs
officer authorizes the release of the merchandise or any part of the merchandise
covered by the entry documentation .... ." 19 C.F.R. § 141.68(a). Where the entry
summary is filed at the time of entry, the time of entry is the time of filing the entry
summary. 19 C.F.R. § 141.68(b); see C.S.D. 82-80, 16 Cust. B. & Dec. 822, 823.
30. T.D. 79-221, 13 Cust. B. & Dec. at 685-86. According to Customs, "'Time
of entry' is used in section 209 of Public Law 95-410 (19 U.S.C. § 1504) to refer to
the time the merchandise enters the commerce of the United States. Therefore, for
purposes of liquidation, Customs believes this term has a different meaning than that
set forth in proposed section 141.68." Id.; see supra note 29 (text of 19 C.F.R.
31. 19 C.F.R. § 159.11(a).
allow that whatever the importer asserted when attempting to
obtain release of merchandise, whether or not Customs
actually released the merchandise, would be the asserted rate. A
second, more strict interpretation, following the language of
the statute, would allow the rate that Customs accepted when
releasing the merchandise to govern. The third interpretation,
which has been adopted by Customs, is that the rate appearing
on the entry summary, whether or not it was asserted by the
importer at the time of entry, is the correct rate for deemed
liquidation. The CIT has adopted this last interpretation.
II. INTERPRETATION OF SECTION 504 BY THE COURT
OF INTERNATIONAL TRADE
The CIT has addressed the issue of deemed liquidation on
several recent occasions. 3 In most instances, the CIT has
avoided the issue of whose rate is proper either by denying
jurisdiction 34 or holding that there was a valid extension of the
initial one year period under section 504(b).3 5 In
DetroitZoolog32. See infra notes 33-58 and accompanying text.
33. See, e.g., Miller & Co. v. United States, No. 86-110, slip op. at 3-4 (Ct. Int'l
Trade Oct. 24, 1986); Old Republic Ins. Co. v. United States, 645 F. Supp. 943,
94850 (Ct. Int'l Trade 1986); American Permac, Inc. v. United States, 642 F. Supp. 1187,
1191-97 (Ct. Int'l Trade 1986); Philipp Bros., Inc. v. United States, 630 F. Supp.
1317, appealdismissed, No. 86-1122, slip op. (Fed. Cir.July 18, 1986), decision on remand
upheld, No. 86-107, slip op. (Ct. Int'l Trade Oct. 22, 1986); Pagoda Trading Co. v.
United States, 617 F. Supp. 96, 99-100 (Ct. Int'l Trade 1985); Special Commodity
Group v. Baldrige, 6 Ct. Int'l Trade 264, 265-66 (1983).
34. See Miller & Co., No. 86-110, slip op. (Ct. Int'l Trade Oct. 24, 1986); Detroit
Zoological Soc'y v. United States, 630 F. Supp. 1350 (Ct. Int'l Trade 1986).
Exhaustion of administrative remedies is a prerequisite to invoking the jurisdiction of the
CIT, and thus denial of protest must occur before an importer can appeal to the
court. See supra notes 17-19 and accompanying text. However, because liquidation is
a prerequisite to the filing of a protest, where an extension is found to be valid, the
court may deny jurisdiction on the ground that no valid protest was filed and no
denial of protest occurred. Miller & Co., No. 86-110, slip op. (Ct. Int'l Trade Oct. 24,
1986); Detroit Zoological Soc y, 630 F. Supp. at 1350.
35. See Old Republic Ins., 645 F. Supp. at 950; American Permac, 642 F. Supp. at
1191; PhilippBros., 630 F. Supp. at 1324. Under section 504(b), extension may occur
for one of three reasons: (
) Customs requires additional information, (
liquidation is suspended by statute or court order, or (
) the importer requests an
extension. 19 U.S.C. § 1504(b). See supra note 20. Suspension of liquidation by statute or
court order is distinct from extension and is but one of the three grounds upon which
extension is permitted. See Pagoda Trading,617 F. Supp. at 99; Old Republic Ins., 645 F.
Supp. at 948-49. Where liquidation is suspended by statute or court order, the
surety must be notified. 19 U.S.C. § 1504(c). However where liquidation is
extended for reasons other than suspension, there is no requirement of notice to the
ical Society v. United States, the CIT not only held that there was a
valid extension, but also stated that the proper rate for deemed
liquidation is the rate at which Customs permits entry. 6
In Detroit Zoological Society, the plaintiff was the consignee
of a locomotive and coaches to be used in its zoo train and had
attempted to classify the merchandise as duty free under Tariff
Schedules of the United States (TSUS) number 862.10:
"Articles imported for exhibition by any institution or society
established for the encouragement of... education or science ......
Customs, however, had insisted upon classification under
TSUS 690.05 and 690.15 (transportation equipment), and
806.20 ("Articles exported for repairs or alterations
...Intersurety. Old Republic Ins., 645 F. Supp. at 949 n. 14. Suspension must be authorized by
statute or court order and may even extend beyond the four year limit. 19 U.S.C.
§ 1504(d). But there is no provision for extension beyond the four year limit where
Customs requires information or the importer requests extension. 19 U.S.C.
) and (
). American Permac, 642 F. Supp. at 1191; see also 19 C.F.R.
It seems that the CIT favors finding a valid extension rather than permitting
liquidation by operation of law. In adopting its stance, the court has relied on a
ruling by the Court of Appeals for the Federal Circuit in Ambassador Div. of
Florsheim Shoe v. United States. 748 F. 2d. 1560 (Fed. Cir. 1984). In Florsheim Shoe, the
Court of Appeals reversed a decision of the CIT denying an extension of liquidation
while an administrative review of countervailing duties was pending. The Court of
Appeals found an "implied statutory requirement" that liquidations be suspended
pending periodic review by the International Trade Administration (ITA) and that
this constituted a valid ground for extension ofliquidation under § 1504(b)(
). Id. at
1563. (Under 19 U.S.C. § 1675(a), the ITA must annually review all outstanding
countervailing duty and antidumping duties, but there is no express requirement that
liquidations be suspended pending such review. Id. at 1561-63.)
The later cases involving suspension ofliquidation pending the results of
adminstrative review have adopted the reasoning ofFlorsheim Shoe. See, e.gM.,iller & Co., No.
86-110, slip. op. (countervailing duty regarding Brazilian pig iron); American Permac,
642 F. Supp. at 1190-91 (antidumping duty regarding German drycleaning
equipment); Philipp Bros., 630 F. Supp. at 1324 (countervailing duty regarding Brazilian pig
iron). Therefore, as a result of the "implied statutory requirement" rule of Florsheim
Shoe, the CIT has not reached the question of the proper rate for deemed liquidations
in cases involving suspension of liquidation due to administrative review of
countervailing or antidumping duties.
It is interesting to note that even before the implied statutory requirement rule
of Florsheim Shoe, the CIT had refused to permit deemed liquidation where
administrative review of a countervailing duty was pending. Special Commodity Group v.
Baldrige, 6 Ct. Int'l Trade 264 (1983). In Special Commodity Group, the court held,
"Where administrative proceedings are in process, and the agency has not adopted a
final decision, the matter is generally not ripe for judicial review." Id. at 269.
36. Detroit ZoologicalSoc'y, No. 86-102, slip op. at 8 (Ct. Int'l Trade Oct. 14, 1986)
(granting plaintiff's motion to supplement complaint in part, denying defendant's
motion to dismiss) (adopting footnote 9 of earlier opinion); 630 F. Supp. at 1355 n.9.
nal combustion engines").3 7 Plaintiff deposited duties 38 and
made a request for internal advice regarding the proper
Customs failed to liquidate within one year, after which
time plaintiff filed protest. Plaintiff then filed suit seeking
liquidation by operation of law under section 504(a) at the rate
actually asserted at the time of entry.40 Because protest had
not yet been denied, plaintiff did not meet the jurisdictional
requirement of exhaustion of administrative remedies.4 '
Therefore plaintiff attempted to invoke the residual
jurisdiction of the CIT 42 which authorizes jurisdiction under special
circumstances in order to avoid unjustified delays.4 3 Having
filed protest, plaintiff subsequently sought to amend its
complaint to include an allegation ofjurisdiction based on
exhaustion of administrative remedies.4 4 The immediate issues
before the court were plaintiff's motion to amend its complaint
with regard to jurisdiction and defendant's motion to dismiss
for lack of jurisdiction.4 5
The CIT held that Customs' extension of the period of
liquidation was valid and therefore no jurisdiction existed
because administrative remedies had not yet been exhausted.4 6
The court reasoned that because plaintiff had made a request
for internal advice, Customs had valid grounds for extending
liquidation under section 504(b)(
) which authorizes an
extension where "information needed for the proper appraisement
or classification of the merchandise is not available to the
ap37. 630 F. Supp. at 1353; see Tariff Schedules of the United States (1985).
38. 630 F. Supp. at 1353; see 19 U.S.C. § 1505(a) (requirement that importer
39. 630 F. Supp. at 1356; see 19 C.F.R. § 177.11. A request for internal advice
regarding proper application of the Customs laws is made by a Customs field office to
Headquarters and will be made whenever an importer so requests. Id.
40. 630 F. Supp. at 1353. While most of the entries were filed as dutiable at the
insistence of Customs officials, plaintiff claimed to have asserted duty free status for
the merchandise in oral and written statements made to Customs officials at the time
of entry. Plaintiff's Response in Opposition to Defendants' Motion to Dismiss for
Lack of Subject Matter Jurisdiction, forJudgement on the Pleadings, and/or for
SummaryJudgement at 7-8, 630 F. Supp. 1350 (Ct. Int'l Trade) (No. 85-2-00275) (1986).
41. See supra notes 17-19 and accompanying text.
42. 28 U.S.C. § 1581(i).
43. 630 F. Supp. at 1353 n.6.
44. Id.; see also 28 U.S.C. § 1581(a).
45. 630 F. Supp. at 1353.
46. 630 F. Supp. at 1356-57; see 28 U.S.C. § 158 1(a).
propriate customs officer."4 7 The CIT further held that a
delay of five to ten months to obtain internal advice was not
unreasonable.4" The court also denied plaintiff's claim of
jurisdiction based on special circumstances.4 9 However, the court
did permit plaintiff ten days to present a plan for further
discovery on the issue of the validity of the extensions. 51
Significantly, in its opinion the CIT stated that the proper rate for
deemed liquidation is not what the importer asserted at the
time of entry, but the rate accepted by Customs on the entry
summary, 5 adding that it was not convinced that Congress
intended to "impose a harsh penalty on Customs for a failure to
timely liquidate an entry. 52
After the court's opinion, Customs liquidated plaintiff's
entries, whereupon the plaintiff filed protests which were
subsequently denied.53 Plaintiff once again moved to amend its
complaint alleging jurisdiction of the CIT based on exhaustion
of administrative remedies.54 The court allowed jurisdiction
47. 19 U.S.C. § 1504(b)(
); 630 F. Supp. at 1356-58. According to the court,
"The term 'information,' as it is used in the statute, 19 U.S.C. § 1504(b)(
) (1982) ...
should be construed to include whatever is reasonably necessary for proper
appraisement or classification of the merchandise involved. When a request for internal
advice of a classification decision is granted, the 'information' required to make the
appropriate classification includes that advice. An extension of liquidation is thus
justified in such a case if additional time is needed to obtain the internal advice and to
consider it before making the classification decision." Id. at 1356-57.
48. Id. at 1357.
49. Id. at 1359; see 28 U.S.C. § 1581(i).
50. 630 F. Supp. at 1360.
51. Id. at 1355 n.9.
Although an entry liquidated by operation of law is "deemed liquidated at
the rate of duty, value, quantity, and amount of duties asserted at the time of
entry by the importer, his consignee, or agent," ...t.his does not eliminate
the possibility that this rate of duty and amount of duties will be contested
through protest. For, as plaintiff seems to acknowledge, the rate of duty
corresponding to the classification asserted "at the time of entry" is that
which is on the entry summary accepted by Customs and contains not what
the importer, his consignee, or agent necessarily desires but rather what
Customs insists upon as a condition precedent to release of the merchandise
.... [T]he legislative history of deemed liquidation clearly indicates that
liquidation by operation of law is designed to expedite the process of
liquidation. The court is not convinced, however, that Congress sought to
impose a harsh penalty on Customs for a failure to timely liquidate an entry.
53. No. 86-102, slip op. at 2 (Ct. Int'l Trade Oct. 14, 1986).
54. Id.; see 28 U.S.C. § 1581(a).
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but held that after reviewing the evidence, due to an ongoing
dialogue between plaintiff and Customs, the original
extensions were valid and no deemed liquidation had occurred.5 5
The court adopted footnote nine of its earlier opinion5 6 and
stated that deemed liquidation was to occur "at the rate of duty
set forth in the entry papers, as required by the Customs
Service, not at the rate at which the importer indicates to Customs
he wishes to enter the merchandise."5 7 In Detroit Zoological
Society, for the first time the CIT directly stated its position on the
question of the proper rate for deemed liquidation.
Importantly, this stance was later explicitly adopted in American
Permac, Inc. v. United States.5"
The significance of the holding in Detroit Zoological Society is
that the CIT directly addressed the issue of whose rate was
proper in deemed liquidation situations"9 and decided that
55. No. 86-102, slip op. at 6-7.
56. See supra note 51.
57. No. 86-102, slip op. at 8.
58. 642 F. Supp. 1187, 1195 n.12 (Ct. Int'l Trade 1986).
59. It is also quite significant that the court refused to allow deemed liquidation
even though the delay was merely administrative. Based on this and other cases, it
seems that the CIT is disinclined to permit deemed liquidation. See supra note 35.
One exceptional case, however, was Pagoda Trading Co. v. United States, in
which the court ordered Customs to liquidate at the rate asserted by the importer at
the time of entry. 617 F. Supp. 96 (Ct. Int'l Trade 1985). This holding, however,
cannot be viewed as inconsistent with what may be viewed as the court's
disinclination toward deemed liquidation, in that Customs had committed several
administrative errors in handling the importer's entry, including failure to liquidate after
suspension had been revoked and sending an erroneous notice of suspension to the
importer. Id. at 98-99. Despite Customs' argument that liquidation should be based
on valuation at the American Selling Price, the court ordered Customs to "assess
duties as proposed upon entry . II..d. ". at 100. Although the case involved a
suspension of liquidation due to administrative review of countervailing duties, the rule
of Florsheim Shoe did not apply because the suspension had already been revoked. See
supra note 35.
In another case of administrative failure, however, (he court refused to permit
deemed liquidation. In Old Republic Insurance Co. v. United States, the court
decided that despite Customs' failure to notify the surety of extension of liquidation as
required under section 504(c), it would not allow deemed liquidation to occur. 645
F. Supp. 943 (Ct. Int'l Trade 1986). The court advanced four basic arguments: (
the surety was not prejudiced in any tangible way, (
) Customs' reversal of a previous
ruling discharging the plaintiff surety need not have met the notice requirements of
19 C.F.R. § 177.10(c), (
) Congress had expressly omitted sureties from the list of
parties required to be notified in the event of extension, and (
) extension of the
liquidation did not materially increase the surety's risk, despite the fact that the court
held the requirements of 19 C.F.R. § 159.12 (extension of liquidation) were
incorporated into the surety bond and were a contractual obligation. Id. at 954-55. Old
Rethere was authority in the law for Customs to determine the
rate asserted at the time of entry.60 In reaching its conclusion,
the court relied on congressional intent, citing the Senate
Report on The Customs Procedural Reform and Simplification
Act of 1978 (Senate Report). 6 ' However, the Senate Report
does not necessarily support the court's contention that the
extension was valid, and nowhere addresses the issue of the
proper rate for deemed liquidation in a reject situation. 62 A
closer look at the history of section 504 reveals more clearly
what Congress intended.
III. GIVING EFFECT TO SECTION 504: DEEMED
LIQUIDATION AT THE IMPOR TER'S
A SSER TED RATE
As stated by the United States Customs Court:
It is the function of this court on judicial review to interpret
and apply the tariff laws in light of the intent of Congress.
In the performance of this function, the court cannot defer
to an administrative interpretation or application of a
statute if it is inconsistent with the statutory language or
Despite the inconsistency its interpretation creates with
the statutory language,6 4 Customs has interpreted and applied
section 504 in a manner designed to protect the revenue of the
public Insuranceillustrates the willingness on the part of the CIT to hold an extension
valid despite the failure of Customs to follow statutory requirements regarding
liquidation by operation of law.
The two cases involving administrative failure, Pagoda Trading and Old Republic
Insurance, may be distinguished by the relative degrees of administrative failure.
Where there is gross failure, as in Pagoda Trading, the CIT has ordered deemed
liquidation at the importer's asserted rate. Where Customs has merely failed to follow
the notice requirements of section 504, as in Old Republic Insurance, the court has
found a valid extension, rather than permit liquidation by operation of law. But
where delay in liquidation is due to simple administrative delay on the part of
Customs, as in Detroit Zoological Society, the issue becomes much more problematic.
60. See supra note 51. Contrary to the court's finding, the rate asserted in order
to obtain release of the merchandise is not that which is on the entry summary, but
that which is on the entry. See supra notes 9-13 and accompanying text.
61. 630 F. Supp. at 1355; S. REP. No. 778, 95th Cong., 2d Sess., reprintedin 1978
U.S. CODE CONG. & ADMIN. NEWs 2211, 2242-43 [hereinafter SENATE REPORT]. See
infra notes 86-93 and accompanying text.
62. SENATE REPORT, supra note 61, at 2242-43.
63. C.B.S. Imports Corp. v. United States, 80 Cust. Ct. 61, 66 (1978).
64. See supra notes 21-32 and accompanying text.
Moreover, Congress clearly intended section
504 to alleviate administrative delay and was willing to accept a
reduction in revenue
in the interest of protecting
imA. Purpose of Section 504: Alleviation of Administrative Delay
Prior to 1978, there was no time limit on liquidations.6 7
As a result, entries
years, 68 leaving importers and sureties in a position of
prolonged uncertainty regarding liability for duties on past
importations. 6 9 Section 504 was passed in order to remedy this
In 1975, the accumulation of a substantial backlog of
unliquidated entries provided the impetus for a change in the law
regarding liquidations. In that year the House Subcommittee
on Trade held hearings on customs administration reform.7'
Reason for Change.-The provisions adopted by the committee would
increase certainty in the customs process for importers, surety companies, and
other third parties with a potential liability relating to a customs transaction.
Under the present law, an importer may learn years after goods have been
imported and sold that additional duties are due, or may have deposited
more money for estimated duties than are actually due but be unable to
recover the excess for years as he awaits liquidation. Surety companies,
which are jointly liable with importers for additional duties, would be better
able to control their liabilities. Sureties would also be better protected
against losses resulting from the dissolution of their principals in instances
where there has been undue delay in liquidating entries.
One of the immediate concerns of the subcommittee members
was the four-year delay in liquidation of entries of imported
automobiles. 72 The subcommittee addressed the question of
whether or not Customs should expedite liquidations of
outstanding automobile entries in order to avoid the retroactive
assessment of anti-dumping duties.73 It is clear that Congress'
immediate concern was administrative delay, and the hostility
of some of the subcommittee members to Customs is quite
evident from the transcripts of the hearings.7 1
The 1975 hearings led to the proposed Customs
Modernization Act of 197575 which included a provision that would
have deemed a protest denied if not actually denied within two
years after filing. 76 While this provision would have expedited
access to the CIT, it did nothing to force Customs to liquidate
in a timely manner. Customs criticized the measure as
unnecessary.77 Other witnesses before the committee criticized the
measure as a penalty on the importer 78 and several suggested
Subcomm. on Trade of the House Comm. on Ways and Means, 94th Cong., 1st Sess. (1975)
[hereinafter 1975 Hearings].
72. Id. at 3.
instead that where Customs failed to act on a protest within
two years, the protest should be deemed allowed.79
Due to heavy criticism from all sides, the proposed
Customs Modernization Act was subsequently dropped and a task
force formed to investigate customs administration.80 As a
result of the efforts of the task force, the subcommittee proposed
"deemed liquidation" in lieu of "deemed denial of protest."
This was incorporated into the act which was finally passed the
following year, known as the Customs Procedural Reform and
Simplification Act of 1978.1 The deemed liquidation measure
was supported by both Customs and private industry,82 with
the one significant point of contention being the absence of
any notice requirement for deemed liquidations.83 Despite the
objections of the private industry spokesmen, the final version
of the statute included a provision that no notice need be given
of deemed liquidations,84 a fact which strongly implies that
since deemed liquidation was expected to occur at the
importer's actual asserted rate, lack of notice would not prejudice
It is clear from the evolution of section 504 that Congress
was primarily concerned with administrative delay and sought
to force Customs to act in a timely manner. It may be argued
that in Detroit Zoological Society, the CIT failed to give adequate
consideration to legislative intent, with the result that the
decision serves as an endorsement of delays in Customs
little or no support in the hearings. The following industry organizations opposed
the measure: The American Importers' Association, National Customs Brokers and
Forwarders Association of America, Philadelphia Freight Brokers, Forwarders
&Customs Brokers Assocation, Inc., The Electronic Industries Association, The
BritishAmerican Chamber of Commerce, The Association of the Customs Bar, The Foreign
Trade Association of Southern California, The Los Angeles Area Chamber of
Commerce World Trade Committee, and The Los Angeles Customs and Freight Brokers
79. Id. at 198, 289-90, 407-08.
80. See Customs ProceduralReform Act of 1977: Hearings on H.R. 8149 Before the
Subcomm. on Trade of the House Comm. on Ways and Means, 95th Cong., 1st Sess. 1-3, 184
(1977) [hereinafter 1977 House Hearings].
81. See supra note 4.
82. 1977 House Hearings, supra note 80, at 56, 117, 276, 375, 451 (1977).
83. Id. at 68, 117, 276, 377, 451, 575.
84. 19 U.S.C. § 1504(a). However, the Customs Regulations require that
bulletin notice of deemed liquidation be provided. 19 C.F.R. §§ 159.1 1(a), 159.9(c)(
85. The court's argument that delay due to processing of a request for internal
Whose Rate is this Anyway?
The Senate Report8 6 states that deemed liquidation is to
occur at the rate asserted "in the entry document and import
documents filed with Customs under section 484 of the Tariff
Act at the time of entry."' 87 Section 484 of the Tariff Act8 8
clearly distinguishes those documents necessary to be filed at
the time of entry from those documents which constitute the
entry summary. 89 This distinction was added to the Customs
laws at the same time as deemed liquidation, both provisions
being part of the Customs Procedural Reform and
Simplification Act of 1978.90 Therefore, Congress seems to have been
aware of the meaning of the language of section 504 and
inadvice constituted valid grounds for extension seems to negate the purpose of the
law. Moreover, there is no requirement of reasonableness in section 504(b), so the
court's holding that a five to ten month delay was not unreasonable may not be
relevant in light of the legislative history or the plain language of the statute.
The fact that Congress was responding to delays in liquidation due to pending
anti-dumping reviews might even call into question the holding of the Federal Circuit
in FlorsheimShoe. Ambassador Div. of Florsheim Shoe v. United States, 748 F.2d 1560
(Fed. Cir. 1984); see supra note 35. However, in Florsheim Shoe, the court advanced
several policy arguments which, even when viewed in light of the legislative history,
strongly justify its holding. The court there invoked the "absurd-consequences"
doctrine of statutory interpretation. Florsheim Shoe, 748 F.2d at 1564 (citing Church
of the Holy Trinity v. United States, 143 U.S. 457 (1892)). It concluded that section
504 cannot be interpreted so as to negate the effect of the countervailing duty laws
and that the deemed liquidation statute must be interpreted in harmony with these
laws. FlorsheimShoe, 748 F.2d at 1565. The potential adverse consequences resulting
from a contrary holding in Florsheim Shoe would be that importers would be able to
avoid anti-dumping or countervailing duties through deemed liquidation.
By contrast, DetroitZoological Society presents a clear case of simple administrative
delay, where substantial adverse consequences probably would not follow from a
holding in the importer's favor. The court acknowledged that the importer had
provided Customs with sufficient information to liquidate. DetroitZoological Soc'y, 630 F.
Supp. at 1356. Yet the court held that the importer's request for internal advice
justified an extension. Id. at 1356-57. The court said that it "need not determine
whether a request for internal advice is tantamount to a request for an extension of
liquidation." Id. at 1356 n.12. Yet it gave no suggestion as to what would or would
not constitute permissible administrative delay. Rather than encourage
administrative delay by permitting extensions, the court should simply allow deemed
liquidation to occur. It would seem that in such situations policy should favor deemed
86. SENATE REPORT, supra note 61.
87. Id. at 2243.
88. 19 U.S.C. § 1484 (1982).
89. 19 U.S.C. § 1484(a)(I)(A)-(B); see supra note 13.
90. Pub. L. No. 95-410, § 102(a)(l), 92 Stat. 888 (codified at 19 U.S.C. § 1484);
see supra note 4.
tended to use the rate actually asserted at the time of entry,
rather than the rate shown in the entry summary for deemed
liquidation. 9 t The specific question raised in Detroit Zoological
Society, is whether the proper rate is that which the importer
attempted to file or that which Customs accepted.9 2 When
considering section 504, Congress did not discuss the situation
where Customs rejects the importer's original assertion. Yet
according to the CIT, Congress intended that only the rate
accepted by Customs may be given effect because deemed
liquidation was not intended to be a penalty on Customs. 9 3
There is reason to believe, however, that deemed
liquidation was intended to be a penalty on Customs. Even the CIT
has referred to deemed liquidation as a penalty on Customs 9 4
and that it was designed to benefit the importer.9 5 The record
of the hearings indicates Congress' hostility towards
Customs. 96 But more significantly, Congress expected that the
91. Congress was concerned with the precise meaning of the term "entry." At
one point in the early hearings, Customs specifically defined the term for the
subcommittee. 1975 Hearings,supra note 71, at 18.
92. 630 F. Supp. at 1355 n.9.
94. American Permac, Inc. v. United States, 642 F. Supp. 1187, 1192-94 (Ct.
Int'l Trade 1986) ("[N]othing in the text or history of § 1675(a) shows that Congress
intended to impose the penalty of deemed liquidation when a review is not
completed after four years .... [T]he Senate Finance Committee . . . did not specify
deemed liquidation as a penalty for non-compliance [with the countervailing duty
laws]."); Philipp Bros. Inc. v. United States, 630 F. Supp. 1317, 1324 (Ct. Int'l Trade
1986) ("[Iln this situation, the court is unable to conclude that the statute imposes a
penalty of deemed liquidation for the delay.").
95. Pagoda Trading Co. v. United States, 617 F. Supp. 96, 99 (Ct. Int'l Trade
1985) ("There is no doubt that the statutory provision for liquidation by operation of
law was designed for the benefit of importers."); see also Peugeot Motors of America,
Inc. v. United States, 8 Ct. Int'l Trade 167, 171 (1984).
96. See supra note 74. In Detroit Zoological Society, the court cited an article by Mr.
Leonard Shayne, who, as Chairman of the National Customs Brokers and Forwarders
Assocation of America, Inc., was a participant in the congressional hearings. Detroit
Zoological Soc'y, 630 F. Supp. at 1355 n.9 (citing Shayne, Deemed Liquidated, AMERICAN
IMPORT-EXPORT BULLETIN, July 1979 at 37-40); see 1976 Hearings, supra note 77, at
249; Customs ProceduralReform Act of 1977, Hearings Before the Subcomm. on Int'7 Trade of
the Senate Comm. on Finance, 95th Cong. 2d Sess. 86 (1978) [hereinafter 1978 Senate
Hearings]. According to Mr. Shayne, Congress was extremely hostile to Customs and
intended to impose a penalty for failure to liquidate within one year. Moreover,
despite the fact that his article called for an amendment to section 504, Mr. Shayne
believes that, in the interest ofjustice, the rate of deemed liquidation should be the
rate actually asserted by the importer. Telephone interview with L. Shayne,
President, Leading Forwarders, Inc. (Dec. 15, 1986) (author's notes available at the
Fordham InternationalLaw Journal).
deemed liquidation provision would result in a revenue loss to
the government.9 7 The Senate Report indicates an estimated
annual revenue loss of $9.5 million.98 This figure was derived
from written testimony presented by Customs to the
congressional subcommittee on the proposed law99 and was accepted
by Congress and subsequently incorporated into the Senate
Report. Customs believed that due to the normal ratio of rate
advances to declines occurring when Customs actively
liquidated entries, a revenue loss would result from passage of the
measure, because deemed liquidation was to occur at the rate
asserted by the importer. 00 While it may be argued that
Customs nevertheless expected that deemed liquidation would
occur at the rate asserted in the entry summary rather than the
entry, it seems unlikely that they did, since the question of the
proper rate in reject situations was not even raised until the
1979 Customs Bulletin was issued-after section 504 was
already law. But even if Customs did originally intend to use the
entry summary, in actual practice the rate asserted by the
importer is usually the same as the rate shown in the entry
summary.' O' Consequently, Customs' calculation of the expected
revenue loss would not be significantly altered by deemed
liquidation at the importer's asserted rate. On this basis, it may
be argued that Customs expected that the importer's actual
assertion would determine the rate of deemed liquidation and
the result would still be a loss of revenue to the government.
97. SENATE REPORT, supra note 61, at 2243.
99. 1978 Senate Hearings,supra note 96, at 68 (written testimony of U.S. Customs
in response to questions submitted to Robert E. Chasen, Commissioner of Customs):
For those entries automatically liquidated under this provision, there is a
potential duty loss. Of the approximately 540,000 entries to be
automatically liquidated annually, roughly 15 percent or 81,000 will have had errors,
which would have resulted in a rate advance or rate decline had they not
been automatically liquidated. The current ratio of rate advances to
declines is 2 to 1. The average value of duty for a changed entry is
[US]$350.00 (for both rate advances and deliveries). This calculates out to a
maximum potential duty loss of [US]$9.5 million.
101. DiSalvo Interview, supra note 23. Most entries are routinely processed with
the importer asserting his rate in the entry, obtaining release of the merchandise, and
then filing the same rate in the entry summary which is accepted by Customs. Id.
The controversy in Detroit Zoological Society will occur where the importer's original
assertion conflicts with the information on the entry summary.
Therefore, it seems likely that because Congress anticipated a
loss of revenue, deemed liquidation was expected to operate as
a penalty on Customs for failure to liquidate within one year.
The 1979 Customs Bulletin1 0 2 issued prior to issuance of
the regulations may be viewed as the point at which Customs
deviated from the intent of Congress.10 It is subject to several
criticisms. 0 4 First, the Bulletin stated that for purposes of
liquidation, the time of entry should be regarded as "the time the
merchandise enters the commerce of the United States" and
therefore the entry summary should be used for determining
the rate of deemed liquidation.' 0 5 This reasoning is suspect.
Most logically, the merchandise would enter commerce at the
time it is physically released to the importer, not the time of
filing the entry summary documentation ten days later.
Second, while the bulletin states "for purposes of liquidation," it
must be assumed that this means for purposes of deemed
liquidation, because for active liquidations the time of entry would
normally be the date of release of the merchandise. 106
Furthermore, in actual practice Customs uses the date of release
for purposes of timing the statutory one-year period.' 07 Yet
section 504 does not authorize Customs to use the "time of
entry" for determining the date of entry and the "time of entry
summary" for determining the rate asserted by the
According to one authority, when engaging in statutory
interpretation courts must take into account the congressional
intent, 0 9 including the audience to which the law is
di102. T.D. 79-221, 13 Cust. B. & Dec. 641 (1979).
103. See supra notes 24-31 and accompanying text.
104. DiSalvo Interview, supra note 23. According to one Customs official, the
language in T.D. 79-221 is ambiguous in that it refers to the rate "claimed and
indicated" by the importer and yet concludes that the entry summary should be used for
determining the asserted rate. Id.; see T.D. 79-221, 13 Cust. B. & Dec. at 685-86. In
the interest of "protecting the revenue," Customs officials will use the rate shown in
the entry summary. DiSalvo Interview, supra note 23.
105. T.D. 79-221, 13 Cust. B. & Dec. at 685-86.
106. Id.; see 19 C.F.R. § 141.68(a)(
); supra note 30 and accompanying text.
107. 19 C.F.R. § 141.68(a); 19 C.F.R. § 159.9(c)(
); DiSalvo Interview, supra
108. See 19 U.S.C. § 1504(a).
109. Frankfurter, Some Reflections on the Reading of Statutes, 47 COLUM. L. REv. 527
rected." 0 The CIT has relied upon congressional intent and
concluded that Congress could not have intended what the
statute plainly says. But based on the legislative history of section
504, a strong argument may be made that the statute means
exactly what it says. Arguably, the statute was written for the
use of Customs officials, so when Congress mandated that
Customs liquidate at the expiration of one year at the rate asserted
"at the time of entry," Customs officials may have been
incorrect to assume they meant "at the rate shown in the entry
While rejected entries and extensions of liquidation do
not preclude further administrative remedies,"' these
practices force importers to seek a remedy by filing protest, and
with denial of protest, to appeal to the CIT." 2 The difficulty
here is twofold. First, there is a statutory presumption of
correctness with regard to decisions of Customs officials. 1 3
Second, an importer is faced with a difficult burden of proof when
challenging a Customs classification in the CIT." 4 The
importer must prove not only that Customs' classification is
wrong, but that the importer's proposed classification is
right." 5' In light of the legislative history of section 504, in
rejecting a "deemed denial of protest" provision in favor of
deemed liquidation, 1 6 Congress may have intended the law to
operate conclusively on Customs, thereby obviating the need
for further appeal by the importer.
C. Proceduresfor Giving Effect to the Importer'sAssertion
If Congress believes that to give effect to the importer's
actual assertions would be opening a "Pandora's box," then
they should amend section 504 to state explicitly that the
correct rate for deemed liquidations is the rate appearing on the
entry summary. In the absence of such an amendment, the
CIT should permit deemed liquidation to occur at the rate
actually asserted by the importer." 7 This may be accomplished
in two ways. First, under a procedural approach, the importer
should be permitted to attach his original rejected entry to the
entry summary documentation accepted by Customs. In this
way, if Customs fails to liquidate within one year, the
importer's assertions will have been preserved from the time of
entry to the time of deemed liquidation." 8 Such a procedure
would require an amendment to the regulations to the effect
that the importer may attach a rejected entry form to his entry
summary, which would be used to determine the effective rate
of deemed liquidation." 9 Second, under a judicial approach,
116. See supra notes 75-81 and accompanying text.
117. The Pandora's box of deemed liquidation at the importer's asserted rate
would conceivably be that importers will attempt to enter merchandise at little or no
duty in the hope that Customs will fail to liquidate within one year. Using the
importer's rate for deemed liquidation, however, would not preclude Customs' use of
the fraud provisions of section 592 of the Tariff Act of 1930 where appropriate. 19
U.S.C. § 1592. In addition, Customs may reliquidate on account of fraud within two
years after liquidation. 19 U.S.C. § 1521.
118. By statute the entry must contain sufficient information in order to enable
Customs to liquidate. 19 U.S.C. § 1484(d). Customs Form 3461 (Entry/Immediate
Delivery) contains substantially the same information as Form 7501 (Entry
Summary). In order to make entry and obtain release of merchandise, the importer must
file the 3461, evidence of the right to make entry, commercial invoice, packing list,
any special documents required for a particular shipment, and a bond. 19 C.F.R.
). When filing the entry summary, the importer is not required to
include any additional documents except the 7501. 19 C.F.R. § 142.16(a). In other
words, there is sufficient information filed at the time of entry to provide a basis for
liquidation by operation of law.
119. It is assumed that, in the absence of fraud, Customs would not be able to
reliquidate a liquidation by operation of law. See R. ST1JRM, supra note 2, § 8.3.
Under 19 U.S.C. § 1501, a Customs officer may reliquidate those entries originally
liquidated under 19 U.S.C. § 1500. There is no provision for reliquidation of entries
liquidated under 19 U.S.C. § 1504.
the CIT should allow an importer to bring a declaratory
judgment action and prove his original assertion by his own
evidence. Where an importer's asserted rate conflicts with that
shown on the entry summary, the absence of any
administrative remedy should not preclude an importer from availing
himself of the protection of the statute.
Despite the plain language of section 504, in the interest
of protecting the revenue U.S. Customs has interpreted the
statute so that Customs officials have an opportunity to
determine the rate of deemed liquidation. The CIT has upheld
Customs' interpretation on the basis of congressional intent.
A close look at the legislative history, however, reveals that
Congress clearly intended to alleviate administrative delay and
fully expected that deemed liquidation would operate as a
penalty on Customs. For these reasons, in cases where failure to
liquidate within one year is due to mere administrative delay,
the court should permit deemed liquidation at the rate actually
asserted by the importer at the time of entry.
1. 19 U.S.C. § 1504 ( 1982 & Supp . III 1985 ).
2. " 'Liquidation' means the final computation or ascertainment of the duties or drawback accruing on an entry." 19 C.F .R. § 159 .1 ( 1986 ). See 1 R. STURM , CUSTOMS LAw & ADMINISTRATION § 8 (3d ed. 1986 ).
3. An entry is defined under the Customs regulations as "that documentation required... to be filed with the appropriate Customs officer to secure the release of imported merchandise from Customs custody, or the act of filing that documentation." 19 C.F .R. § 141 . 0a(a) ( 1986 ).
4. The one year limitation was added to the Customs laws in 1978. The Customs Procedural Reform andfSimplification Act of 1978, Pub . L. No. 95 - 410 , § 209 , 92 Stat. 888 , 902 (codified as amended at 19 U.S.C. § 1504 ( 1982 & Supp . III 1985 ) (the 1984 amendment substituted the term "importer of record" for "the importer, his consignee, or agent" ).
5. 19 U.S.C. § 1504 (a).
6. See, e.g., American Permac , Inc. v. United States , 642 F. Supp . 1187 ( Ct . Int'l Trade 1986 ) ; Detroit Zoological Soc'y v . United States , 630 F. Supp . 1350 ( Ct . Int'l Trade 1986 ), plaintiff's motion to supplement complaint grantedin part, defendant's motion to dismiss denied , No. 86 - 102 , slip op. (Ct. Int'l Trade Oct . 14 , 1986 ).
7. Detroit Zoological Soc'y, 630 F. Supp . at 1355 n.9.
22. 19 C.F.R. § 141 . 61 (e)(4). "The district director shall reject a form ... if the information provided clearly appears on its face, or is known to the Customs officer , to be erroneous. " Id.
23. Telephone interview with J. DiSalvo , Head of Protest and Control Section, United States Customs Service, New York (Nov. 17, 1986 ) [hereinafter DiSalvo Interview] (author's notes available at the Fordham InternationalLaw Journal);see also R . STURM, supra note 2, § 2.9 ( 1986 ).
24. The regulations interpreting section 504 are codified at 19 C.F .R. § 159 .11( a ) ( 1986 ).
65. See infra note 104.
66. See infra notes 94-101 and accompanying text.
67. See SENATE REPORT, supra note 61 , at 2242.
68. Dart Export Corp. v. United States , 43 C.C.P.A. 64 , cert. denied, 352 U.S. 824 ( 1956 ) (importer claiming retroactive assessment of duties after four year delay in liquidation constituted deprivation of property without due process of law); United States v . St. Paul-Mercury Indem. Co., 194 F.2d 68 ( 3d Cir . 1952 ) (in the absence of any statutory limit on liquidation, court denies surety's claim that provision in bond limited liability to three years after entry); Miles v . United States , 290 F. Supp . 395 , 397 (Cust. Ct. 1968 ) (court holds date of liquidation is beyond control of prospective complainant). Interestingly, in a very early case, a federal court of appeals denied an importer's request that a one year limit be imposed on liquidation, holding that the proposition was without any statutory or other legal support . Gandolfi v. United States , 74 F. 549 , 551 ( 2d Cir . 1896 ).
69. See SENATE REPORT, supra note 61 , at 2242- 43 . As stated in the Senate Re70 . Id.
71. Customs Administrationand Valuation of Imports: Hearings on H.R. 9220 Before the
76. Id . § 210 .
77. Customs Modernization Act and Section 592 of The TariffAct of 1930. Hearings on H.R. 9220 Before the Subcomm. on Trade of the House Comm. on Ways and Means, 94th Cong., 2d Sess . 106 - 07 ( 1976 ) [hereinafter 1976 Hearings] (statement of David R . MacDonald, Assistant Secretary for Enforcement, Operations, and Tariff Affairs).
78. Id . at 198 , 252, 279 , 289 - 90 , 352 , 407 - 08 . The proposed statute received
110. Id . at 536. As stated by Justice Frankfurter: We must, no doubt, accord the words the sense in which Congress used them .... It will help to determine for whom they were meant. Statutes are not archaeological documents to be studied in a library. They are written to guide the actions of men. As Mr. Justice Holmes remarked upon some Indian legislation "The word was addressed to the Indian mind." If a statute is written for ordinary folk, it would be arbitrary not to assume that Congress intended its words to be read with the minds of ordinary men. If they are addressed to specialists, they must be read by judges with the minds of the specialists . Id . (citation omitted).
111. See supra notes 17-19 and accompanying text.
112. Id .
113. 28 U.S.C. § 2639 ; see United States v. New York Merchandise Co., 435 F. 2d 1315 , 1318 (C.C.P.A . 1970 ) ; see also Edge Import Corp . v. United States , 484 F. Supp . 906 , 910 (Cust. Ct. 1979 ).
114. Jarvis Clark Co. v. United States , 733 F.2d 873 , 876 (Fed. Cir.), rehg denied, 739 F.2d 628 ( Fed. Cir . 1984 ) ; see generally, Note, Customs Court Act-Burden of ProofProperApplication of the Dual Burden ofProofin Customs ClassificationDisputes, 9 SUFFOLK TRANSNAT'L LJ . 97 , 99 ( 1985 ) (recent modification of the dual burden of proof).
115. Id . at 99-100;Jarvis Clark, 733 F. 2d at 876; see R. STURM , supra note 2, §§ 46 , 57 .1. * J.D. Candidate , 1988 , Fordham University School of Law.