CBP Announces EAPA Investigation on LE Surfaces, Imposes Interim Measures
CBP has found sufficient evidence to initiate an investigation on whether LE North America (doing business as LE Surfaces) evaded antidumping and countervailing duty orders on quartz surface products from China and imposed interim measures, it said in a notice dated Dec. 20 and released on Jan. 9.
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CBP began its investigation on Sept. 14, following an allegation by Cambria Company. Cambria suggested that LE Surfaces transshipped quartz surface products from Chinese supplier L&E Stone Quartz Surfaces through Thailand via Leta Stone and failed to declare the correct country of origin. Cambria provided trade data showing shipments of artificial quartz stone slabs classified under HTS subheading 6810.99, shipped from Leta to LE Surfaces since June 2021 that matched the classification of quartz surface products covered by the AD/CVD orders. Cambria also alleged that LE Surfaces imported Chinese quartz surface products from Leta before Leta's Thai factory became operational, citing Leta's own press release from November 2021 announcing the factory's opening.
CBP found that Cambria's allegations reasonably suggested that LE Surfaces engaged in evasion attempts by transshipment and failure to declare the correct origin of quartz surface products. The factory opening announcement implied at least five months of evasion by transshipment even if LE Surfaces purchased quartz surface products from Leta's Thai factory, CBP said.
In October, CBP issued a questionnaire to LE Surfaces. The company explained that Leta manufactured quartz slabs from imported materials and that the production process transformed those materials into new products, thereby making Thailand the correct country of origin. CBP then conducted its own research into Leta's operations. CBP found that it was likely that Leta's factory began producing quartz surface products sometime after November 2021. However, CBP could not confirm manufacturing operations before November 2021 and cited inconsistent and unreliable documentation. Crucially, CBP concluded that even unfinished slabs would be considered subject merchandise if further processed in a third country, according to the scope of the orders.
CBP found that there was reasonable suspicion that LE Surfaces evaded the AD/CVD duties and imported covered merchandise and the agency imposed interim measures on LE Surfaces' imports of quartz surface products into the U.S. CBP has suspended the liquidation of each unliquidated entry of covered merchandise that entered on or after Sept. 14, the date of the initiation of the investigation; has extended the period for liquidating each unliquidated entry of such covered merchandise that entered before the date of the initiation of the investigation; and may take additional measures if determined to be necessary, including requiring a single transaction bond or additional security or the posting of a cash deposits. For future entries, CBP will require a Type 03 entry. CBP also will reject any entry summaries that do not comply and will evaluate the importer’s continuous bonds to determine their sufficiency.