Rulings, remedies and court proceedings for customs and trade professionals

CBP Announces EAPA Investigation on Chinese Steel Grating

CBP commenced a formal Enforce and Protect Act investigation on whether Midwest Livestock Systems evaded antidumping and countervailing duty orders by entering Chinese-origin steel grating (A-570-947/C-570-948) in the form of “tri-bar flooring” that was not declared as covered merchandise into the U.S. Based on available information, CBP determined that there was reasonable suspicion of evasion by Midwest and imposed interim measures.

Start A Trial

The investigation began June 7 following an allegation by Hog Slat, a U.S. hog production equipment manufacturer, that Midwest had entered covered steel grating from China either as a stand-alone product or as part of a package of components used to construct farrowing crates and gestation pens. Midwest's tri-bar flooring satisfies the plain language of the scope covering “certain steel grating, consisting of two or more pieces of steel, including load-bearing pieces and cross pieces, joined by any assembly process…,” Hog Slat said. Both CBP and Commerce already have determined that tri-bar flooring is subject to the AD/CVD orders.

Among these materials that Midwest advertises is“Tri-Floor All Metal Flooring,” an “extra heavy duty hot-dipped galvanized creep flooring,” which is a form of steel grating. Hog Slat also provided an affidavit stating that Midwest’s current U.S. pricing for tri-bar flooring wiring was not feasible without AD/CVD evasion, as the combined AD/CVD rate is over 200%.

After beginning the investigation, CBP issued information requests to Midwest concerning a December 2022 entry. CBP said that Midwest's responses showed that the company had imported the covered merchandise from Bai Mu Da in China and that many of the documents and explanations in the responses were provided by Bai Mu Da. CBP concluded that the grating, referred to as "tri-floors" by Bai Mu Da and Midwest, met the requirements of the scope of the orders.

In August, CBP conducted a cargo exam and found multiple pieces of tri-floor, labeled as being "Made in China." Those tri-floors appeared to be multiple pieces of steel, including load-bearing pieces and cross pieces, that were joined together by welding. CBP said that it concluded that the shipment contained tri-bar floors made from carbon steel.

None of the entry documents for the examined shipment mentioned steel gratings or tri-floors, CBP said. The entry summary form did not contain the tariff schedule subheading for steel grating, 7308.90.7000, instead listing subheadings 9817.00.5000 and 7308.90.9590.59. The forms also showed that the shipment was intended to be entered as type 01 not subject to AD/CVD. CBP concluded that the entry contained covered merchandise.

Based on the record evidence, CBP determined that reasonable suspicion existed that Midwest had entered steel grating in the form of “tri-bar flooring” into the U.S. via evasion and determined to impose interim measures. Specifically, CBP will suspend the liquidation of each unliquidated entry that entered on or after June 7. It also will extend the period for liquidating each unliquidated entry of such covered merchandise that entered before that date and take any additional measures deemed necessary, including requiring a single transaction bond or additional security or the posting of a cash deposit with respect to such covered merchandise. Finally, CBP will require live entry and reject any entry summaries that do not comply with live entry as well as evaluate Midwest Livestock’s continuous bonds to determine their sufficiency, it said.

CBP announced a similar investigation last year, also based on an allegation by Hog Slat (see 2211020054).