GDLSK: Grunfeld Desiderio Lebowitz Silverman & Klestadt LLP
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9/9/2021 China 301 Litigation Update

As detailed in our previous litigation updates, the court issued an order on July 6, 2021, that was intended to maintain the availability of refunds for entries that were unliquidated as of the date of that order. That order contemplated that U.S. Customs and Border Protection (CBP) would suspend liquidation of plaintiffs’ List 3 or 4A entries that were unliquidated as of July 6, 2021. However, the mechanism for accomplishing that was largely left to the parties to negotiate. The government had taken the position that plaintiffs would need to provide detailed entry information to CBP every 30 days, while plaintiffs argued that such reporting was unnecessary.

After over two months of negotiations, status reports, and court conferences, the government reversed its position, conceding that the process that it had insisted was necessary would impose a burden on CBP that the agency could not meet. As a result, the government agreed to accept plaintiffs’ proposal that it simply stipulate that refunds will be available for any covered entry that was unliquidated as of July 6, 2021.

On September 8, 2021, the court issued a new order that provides that the government shall refund any duties ultimately found to have been illegally collected on entries that were not liquidated on July 6, 2021. As a result of this new order, plaintiffs will not be required to provide CBP with any entry data at this time. Covered entries will continue to be liquidated in the normal course.
The order does not apply to Section 301 entries that liquidated prior to July 6, 2021, and the availability of refunds for those entries will be determined by the court in the event that plaintiffs are ultimately successful on the merits of the case.

Finally, in the event that plaintiffs do obtain a final judgment holding that the collection of these duties was illegal, it is likely that plaintiffs will need to run a report in CBP’s Automated Commercial Environment (ACE) system to identify its covered entries. For that reason, we continue to recommend that plaintiffs obtain an ACE account with CBP, if they have not already done so. The Plaintiffs Steering Committee (of which GDLSK is an active member) has had discussions with CBP regarding what that report will entail. However, the precise details will not be finalized until the end of the litigation, in the event that plaintiffs are successful.

Should you have any questions, please contact one of our attorneys.


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