Clamshell Food Container Importer Says CBP Verbally Assured It of Section 301 Exclusion
Food storage importer Huhtamaki brought a May 8 complaint to the Court of International Trade saying CBP wrongly applied Section 301 duties to its clamshell container imports. Prior to entry, the importer said, it had undertaken “a months-long wild-goose chase” with CBP that ended with verbal confirmation the imports were excluded (Huhtamaki, Inc. v. United States, CIT # 24-00050).
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Huhtamaki said it initially received a binding classification ruling from CBP that its products were covered under Harmonized Tariff Schedule subheading 4823.70 for “molded or pressed articles of paper pulp,” which it doesn’t contest.
The importer reached out to CBP's Consumer Products and Mass Merchandising Center of Excellence and Expertise for a Section 301 ruling and was assigned an import specialist. In early June 2022, that specialist told Huhtamaki’s customs broker to contact CBP’s Trade Remedy Branch, which quickly sent the importer back to the CEE import specialist, who didn’t respond.
About a month later, in early July, an assistant director for the Consumer Products and Mass Merchandising Center apologized to Huhtamaki and told it “to seek a binding ruling regarding the Exclusion Inquiries.” Huhtamaki told her it had already received a classification ruling and “had been trying to resolve the Exclusion Inquiries for months.” It was then redirected again to the same import specialist.
In early August, the import specialist informed Huhtamaki by telephone call that she and her supervisory import specialist had agreed that Huhtamaki’s products fell under a Section 301 exclusion. Both, however, “refused to reduce this Advisory Opinion to writing.”
Huhtamaki filed “approximately” 75 post-summary corrections for its entries and sought Section 301 refunds. Until “the first quarter of 2023,” CBP accepted the corrections and issued a number of refunds, but it stopped accepting them and informed Huhtamaki on March 2, 2023, that it had determined the importer’s merchandise wasn’t eligible for the exclusion. The exclusion, it said, covers “clamshell containers made of bamboo pulp,” whereas Huhtamaki’s containers were made primarily of sugarcane pulp.
The importer said CBP was equitably estopped from refusing to apply the exclusion. The agency “repeatedly refused to provide the requested determination for several months.” It then “represented to Plaintiff that the Exclusion applied to Plaintiff’s imported merchandise,” including by issuing a number of refunds before changing its stance, Huhtamaki said.
“CBP is the only authority from which Plaintiff could seek a determination of the Exclusion’s applicability and, therefore, its reliance on CBP’s prior course of conduct and its assurances was reasonable and foreseeable under the circumstances,” it said.