CBP Investigating Allegations of Glycine AD Duty Evasion
CBP is investigating Ceka Nutrition "because evidence establishes a reasonable suspicion" of evasion of an antidumping duty order on glycine from China (A-570-836), the agency said on Dec. 4 in a notice. The investigation stems from an allegation filed by GEO Specialty Chemicals in August, CBP said. GEO Specialty, "the largest domestic producer of glycine," alleged that Ceka transshipped glycine through Cambodia to avoid the AD duties, CBP said. Despite a recent report from the International Trade Commission that found no glycine production in Cambodia, "U.S. import data showed an increase in glycine shipments from Cambodia starting in 2015 and continuing through May 2017," GEO Specialty told CBP.
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GEO Specialty looked through house and master bills of lading for shipments of glycine imported by Ceka Nutrition. The research suggested that the listed shipper for several house bills of lading, JC Chemicals, has a manufacturing facility that is actually "in China rather than in the Marshall Islands or Cambodia, as reported on the bills of lading for the shipments of glycine," CBP said. Considering "there being no known glycine production in Cambodia, and JC Chemicals has a demonstrated history of shipping non-scope amino acid products to Ceka Nutrition directly from China, GEO Specialty's allegation reasonably suggested that the origin of Ceka Nutrition's glycine imports was China and, therefore, subject to the AD order," the agency said.
CBP began seeking further information from Ceka Nutrition in September through CBP Form 28s and the company responded with some documentation, CBP said. "Although the CF28s requested that Ceka Nutrition submit information regarding raw materials, manufacturing overhead, labor, general and administrative expenses, and profit, as well as proof of payment to the manufacturer, Ceka Nutrition failed to submit any of the requested information," the agency said. A subsequent site visit in Cambodia also exposed "serious discrepancies" from the items provided in the CF28 response.
The company's "own admission that it only refines glycine it imports from China and does not actually manufacture glycine renders its product within the scope of the AD order," CBP said. Therefore, "we determine that there is a reasonable suspicion that Ceka Nutrition has entered merchandise into the United States through evasion by a material false statement or act, or material omission that resulted in the reduction or avoidance of applicable AD cash deposits and duties," CBP said. As a result, CBP will impose interim measures, including "live entry" requirements for all imports from Ceka Nutrition, it said. The agency will also "reject any entry summaries and require a refile for those that are within the entry summary reject period; suspend the liquidation for any entry that has entered on or after August 28, 2017, the date of initiation of this investigation; as well as extend the period for liquidation for all unliquidated entries that entered before that date," it said.