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U.S. INTERNATIONAL TRADE COMMISSION,
Washington, D.C., July 18, 1978. MICHAEL J. ALTIER, Esq. Deputy Counsel, Subcommittee on Improvements in Judiciary Machinery, Dirk-
son Senate Office Building, Washington, D.C. DEAR MR. ALTIER: This is in response to Senator DeConcini's letter of July 6, 1978, requesting our views on the June 30, 1978, draft of the so-called “Customs Courts Act of 1978." The following comments focus on those provisions of the June 30 version of this bill which, if enacted, would adversely affect the conduct of Commission proceedings and their judicial review. Specifically, these provisions concern the judicial review of the Commission's advisory findings and recommendations in those proceedings in which the Commission is not authorized to: issue final orders and the requirement that the Commission create administrative records in investigations conducted under the Antidumping Act, 1921, and the countervailing duty statute to facilitate judicial review of such proceedings.
With respect to the judicial review of advisory findings and recommendations, the Commission has taken the position that judicial review should be limited to determining the procedural regularity of these actions. This is consistent with proposed section 1583 (c), to amend title 28 of the U.S. Code, in the bill which would limit Customs Court review of the actions of the Office of the Special Trade Representative under section 301 of the Trade Act of 1974. Accordingly, we suggest that proposed section 1583(b) be reworded to read:
(b) After the decision of the President has become final, the Customs Court shall possess exclusive jurisdiction to review advice, findings, recommendations or determinations of the International Trade Commission pursuant to sections 131, 201, 301, 406, and 503 of the Trade Act of 1974, and 22 of the Agricultural Adjustment Act, as amended, solely for the purposes.
of determining the procedural regularity of those actions. With regard to the proposed new sections 2634 (c) and 2634 (d) to amend title 28 of the U.S. Code by requiring the creation of a documentary record in Commission investigations under the Antidumping Act, 1921, and the countervailing duty statute, the Commission has taken the position that these investigations are not “record” proceedings for several reasons. First, the satutory time limits for these investigations are inconsistent with the concept of record proceedings and preclude the Commission's use of compulsory process to obtain necessary information. Second, these acts are not adversary in nature. The Commission performs a fact-finding function. Neither statute authorizes the Commission to impose sanctions on interested parties to these investigations for a failure to cooperate with the information gathering activities of the agency. The hearings conducted by the Commission are not trial-type proceedings, but, rather, legislative-type hearings. Although each of these statutes contemplates that the Commission hold hearings, the hearing ordered is required within the context of whatever investigation the Commission “deems necessary,” and, in the case of the antidumping act, is specifically exempt from the provisions for adjudication in the Administrative Procedure Act. Finally, we do not believe that the Congress intended that the investigations conducted under these statutes be subject to requirements for administrative records. The Commission's investigations under these statutesto determine the impact of imports on domestic industries—are in the nature of market research studies. Should special duties be imposed on the basis of a Commission determination that a U.S. industry is being injured, an interested party may petition for a revocation of the order imposing the duty within two. years of its issuance. Thus, any “record” could become stale for "changed circumstances within those two years
For these reasons, the position of the Commission has been, and remains, that the only documents relevant to the Customs Court's review are the official notices published in connection with the investigation and the actual determination of the Commission and the statement of reasons in support thereof. Cf., Dunlop v. Bachowski, 421 U.S. 560, at 572–573 (1975). Accordingly, we suggest that the description of the Commission's administrative record in proposed Sections 2634(c) and 2634(d) to amend title 28 be changed to read :
(d) Upon service of the complaint on the United States International Trade Commission or its designee in an action contesting one of the determinations set forth in section 516(d) (2) (A) (or (d) (2) (B)) of the Tariff Act of 1930, as amended, the Commission or its designee shall forthwith transmit to the United States Customs Court, its determination together with a complete statement of findings and conclusions, and the reasons or
bases therefor, on all the material issue of fact or law presented consistent with confidential treatment granted by the Secretary of the Treasury or the
Commission, as the case may be, in the course of making its determination. In the June 30 draft of the “Customs Courts Act of 1978," both proposed new sections 2634 (c) and 2634(d) would require the Commission to transmit to the Customs Court all information developed in connection with the investigation and permit the Commission to seal information obtained on a confidential basis. These sections further provide that the confidentiality of such information shall be preserved in the litigation but that the court could review the confidential material in camera if such review is necessary to the disposition of the litigation. Although these provisions of the bill make no reference to protective orders, it is inconceivable that the courts would determine the relevance of the confidential information to the disposition of the litigation sua sponte. Because the parties to these investigations do not have an opportunity at the Commission level to gain access to the confidential materials on which the Commission bases its determinations, it is our view that it would be anomalous if judicial review proceedings could be used to gain this information—not otherwise available from which to frame arguments to the court. This would result in relitigation, rather than judicial review, and would seriously jeopardize the finality of Commission determinations. More important, however, such increased access to confidential information would interfere with prompt voluntary compliauce with the Commission's requests for proprietary data, in turn preventing the Commission from making informed determinations in these investigations. For these reasons we do not believe that the provisions for maintaining the confidentiality of information during judicial review would actually ameliorate the effect of creating a documentary administrative record.
I hope this information is helpful to you. If we can be of further assistance, please call on us. Sincerely yours,
MICHAEL H. STEIN, General Counsel.
AMERICAN IMPORTERS ASSOCIATION INC.,
New York, N.Y., July 20, 1978. Senator DENNIS DECONCINI, Subcommittee on Improvements in Judiciary Machinery, Dirksen Senate Office
Building, Washington, D.C. DEAR SENATOR DECONCINI: We received the revised version of S. 2857 and appreciate your continuing interest in developing a bill that all segments of the trade community can support.
While we remain vitally concerned with S. 2857, we were institutionally incapable of presenting you with a thoughtful analysis of the revision by July 17—only six days after we received it. As a national association we act not only for the interests of our members but also with their direct participation. Their input is especially important in the earlier stages of an issue and also when an issue is as important and comprehensive as is Customs Court reform. Very short deadlines effectively preclude our participation. They certainly eliminate the opportunity for communication with our members beyond the New York area. It is ironic that this deadline for comment on the redrafted bill precedes the closing of the public record on the original bill; we find ourselves preparing a statement on a bill no longer under serious consideration.
Although we have not been able to subject your redraft to our normal procedures for study, we want to provide at least some preliminary comments. We find that although the redraft is an improvement, many serious deficiencies remain. We have enclosed a list of some of those problems.
We at AIA are disappointed with the manner and haste with which this bill is being moved.
While there is now, as a result of the efforts of your Subcommittee, some form of discussion of the concepts in the bill, these discussions are only superficial--based on quick impressions. Even more serious is the lack of attention being given to the specific language used to incorporate these concepts. There has been little effort expended to ascertain precisely what the bill is saying. Each commenting party must operate on what his quick reading assumes the bill says. These short-cut analyses can only lead to problems as the Customs Court interprets, section by section and word by word, the provisions in the bill.
It is the importer, not judges, lawyers, or legislators, who will pay for hurried and unconsidered drafting. Importers will have to spend many thousands of dollars for the resolution of language problems in unnecessary litigation and appeals. Furthermore, the taxpayer will pay because the government will have to defend these cases.
The most serious example of this casual “leave it to the Court" attitude reaches to the very heart of the bill. There has been no attempt to define the meaning and scope of the phrase "directly affecting imports” in section 1581. No one seems to have thought through its potential scope or decided how far it should apply. Yet without such an effort, we cannot even approach a precise knowledge regarding the potential application of many of the bill's sections. Again, the failure to define "customs laws” in section 1585 leaves unresolved one of the present jurisdictional disputes. Language in sections 1585 and 2640 is unclear on its face; almost certainly many more ambiguities are waiting to be discovered, if not by serere scrutiny now, then by unfortunate importers only after their cases are in court. Even the very careful and lengthy work done on the 1970 Customs Court Act—work which had begun many years earlier-proved to contain flaws.
We repeat our support for many provisions of this bill. We do not want to find ourselves in the unhappy position of having to recommend to our member companies that they actively oppose a bill which, although containing needed reform, on balance presents too many unanswered questions and interpretative pitfalls. Major reforms are not to be made in haste. A major alteration in our judicial system should be acted upon with even greater deliberation.
Although this letter may appear very negative, we intend to be constructive. We wish to assist you in developing the best possible system of judicial review for international trade. We simply do not believe that such a result is possible if the current pace of consideration is continued.
If the schedules of the Subcommittee and its staff provide time for this bill this year, we submit that the time will be better spent in developing a solid bill for the Ninty-sixth Congress. Importers and the government have managed quite well with the existing system for seven years; both will continue to manage during the time it takes to examine this bill in the proper manner. Very truly yours,
GERALD O'BRIEN, Executive Vice President.
Section 1581. The phrase "directly affecting imports” remains undefined. (See accompanying letter.)
Section 1583. Subsection (b) & (c) each create a cause of action. Such substantive changes belong in amendments to title 19 of the United States Code.
Section 1585. The meaning of the new language-all that follows the second comma—is confusing at best. Certainly its intent is unclear.
saction 1586 (a). In eliminating the word “tax” but retaining "fee” the redraft accepts a criticism of the first draft but carries it only halfway. Similar half solutions appear in a number of other sections as well.
Section 1591. The burden of proof to be applied in these cases remains ambiguous. If it is only to be one of substantial evidence under section 2640 (d), then we find it unacceptable.
Section 1592. While this section has been improved, we still cannot support it because of its chilling effect on importers with meritorious claims.
Section 2631. The changes in subsection (b) are an improvement but as with the changes in section 1592, they also leave the importer in the position of questioning whether he dares take a meritorious claim to court.
Section 2634. The words “summons or” should also be included here preceding each mention of a complaint.
Section 2040. The meaning of the opening language is unclear. The purpose of this bill is to clarify, not further confuse, such issues. This lack of care illustrates the nature of our concern over the drafting of the entire bill.
Section 2643. Provisions of section 516 (19 U.S.C. 1516) are not appropriate for inclusion in this section.
Section 601. This extensive reworking of section 516 is inappropriate in this bill. This is a substantive amendment to title 19 and should be presented in a separate bill.
Further, in our testimony on June 23, we asked that several other provisions be included in the bill. They do not appear in this redraft, however.
There is no provision for a small claims division in the Customs Court. Nor are there provisions for importers to challenge antidumping and countervailing
duty determinations of the Treasury Department prior to a liquidation in which such extra duties are assessed.
DEPARTMENT OF JUSTICE,
Washington, D.C., July 21, 1978. MICHAEL J. ALTIER, Esq. Deputy Counsel, Subcommittee on Improvements in Judicial Machinery, Dirksen
Senate Office Building, Washington, D.C. DEAR MR. ALTIER : Senator DeConcini's letter of July 6, 1978, requests that we direct our comments on a revised version of the Customs Courts Act of 1978 to you.
The revised version of the bill primarily clarifies the language of S. 28.37 and does not adversely affect ihe objectives of the bill. Since, in our view, the bill will make an important contribution to achieving the laudable goals stated in section 101, the Department of Justice supports the enactment of the revised version into law. Very truly yours,
BARBARA ALLEN BABCOCK,
Assistant Attorney General.
STEIN, SHOSTAK, SHOSTAK & O'HARA, INC.,
Los Angeles, Calif., July 24, 1978. Hon. DENNIS DECONCINI, Chairman, Subcommittee on Improvements in Judiciary Machinery, Dirksen Sen
ate Office Building, Washington, D.C. DEAR SENATOR DECONCINI: This statement is filed on behalf of the Customs Law Committee, Los Angeles County Bar Association, with respect to S. 2857, the Customs Courts Act of 1978 as originally proposed and as revised on June 30, 1978.
The Customs Law Committee is comprised of practicing attorneys who devote substantially all of their professional activities to the area of Customs law and administration. Included within the scope of their practices is litigation before the United States Customs Court and appeilate practice before the United States Court of Customs and Patent Appeals. Although the practice of Customs law by members of the Customs Law Committee is nation-wide in scope, a substantial number of the Committee members' clients are located in the Los Angeles and Southern California area. Inasmuch as the United States Customs District of Los Angeles is the second largest district in dollar volume of United States imports in the nation, the importing community in this area and the attorneys representing their interests have an intense concern regarding proposed legislation which affects the judicial process associated with the administration of Customs laws and regulations. For that reason, we are pleased to offer comment upon S. 2857.
We have read with interest the statement submitted to the Subcommittee at the hearings. We endorse, generally, the sentiments expressed by other members of the Customs Bar whose point of view reflects the concern of plaintiffs before the United States Customs Court. In that connection, we commend to the Subcommittee those views expressed by Andrew P. Vance, Esq., representing the Association of the Customs Bar; Robert E. Herzstein, Esq. representing the Standing Committee on Customs Law of the American Bar Association; Joseph S. Kapland, Esq., representing the Section on International Law of the American Bar Association; and Donald W. Paley, Esq., representing the New York County Lawyers Association.
We share with the Subcommittee a belief that legislation is needed to enhance the jurisdiction of the United States Customs Court and to enlarge the scope of remedies available to gants in civil actions brought to that forum. We agree that there should be amendments to the current applicable statutes to obtain a greater utilization of the expertise of the fine jurists who preside in that Court. We share the view, however, generally held by representatives of the plaintiffs' har testifying before the Subcommittee that S. 2857, in its original form, and as revised, will not achieve those goals. In our view, the Bill, if enacted, would be likely to discourage and diminish litigation before the United States Customs Court, leading to a result that all who have addressed the subject of the Courts' jurisdiction would agree is undesirable.
We believe that a great deal of progress in this area could be achieved through legislation along the lines suggested by Honorable Edward D. Re, Chief Judge, United States Customs Court. In his testimony before the Subcommittee on June 23, 1978 and in his letter to you of July 14, 1978 commenting upon the June 30 revision, Judge Re offered alternative proposed statutory amendments which are relatively few in number and clear and straightforward in test and meaning. Were Judge Re's proposals enacted into law, the United States Cutsoms Court would be granted all of the necessary powers, in law and in equity, required for the Court to effectively function. The subject matter jurisdiction of the United States Customs Court would also be enhanced with respect to causes of action brought against the Secretary of the Treasury or the United States Customs Service where immediate and irreparable injury is threatened and quick and decisive judicial action is required. This is an area of present weakness in the statutory structure of the Court and when, coupled with a grant of equity powers, would provide the Court with the judicial tools which are most needed at the present time.
We share the views expressed by many who have testified before the Subcommittee that the subject matter jurisdiction of the United States Customs Court and, to some extent, the United States Court of Customs and Patent Appeals should be enlarged. We endorse the views expressed by Chief Judge Re that that complex task requires more study and evaluation in order to develop appropriate statutory amendments. We believe the provisions of S. 2857 which purport to effect the enlargement of the subject matter jurisdiction of the Courts would not achieve those goals and do not lend themselves, for the most part, to minor textual modifications to overcome the defects in draftsmanship which we believe are evident.
The members of the Customs Law Committee are most appreciative of your efforts and interest in this matter, and of the concerns for the improvement of the judicial machinery of the United States Customs Court and of the United States Court of Customs and Patent Appeals shared by your colleagues on the Subcommittee. We trust that the work of the Subcommittee in this area will continue and we wish you to know of our interest and willingness to assist the Subcommittee as it continues to work upon legislative proposals designed to achieve the goals we all share. Very truly yours,
JAMES F. O'HARA,
Los Angeles County Bar Association.
NATIONAL CUSTOMS BROKERS & FORWARDERS
ASSOCIATION OF AMERICA, INC.,
New York, N.Y., July 25, 1978. STATEMENT OF NATIONAL CUSTOMS BROKERS & FORWARDERS ASSOCIATION OF AMER
ICA TO THE SUBCOMMITTEE ON IMPROVEMENTS IN JUDICIAL MACHINERY SENATE COMMITTEE ON THE JUDICIARY CONCERNING REVISED S. 2857 CUSTOMS COURT ACT OF 1978
Our Association is a nationwide organization of approximately 400 members located in all of the major ports of the country, as well as 23 affiliated local associations. Our members include customs brokers licensed by the U.S. Treasury Department as qualified to enter and clear merchandise through Customs, ocean freight forwarders licensed by the Federal Maritime Commission to handle export shipments, internationl air cargo forwarders licensed by the Civil Aeronautics Board, and IATA air freight sales agents.
We handle through our membership most of the general cargo imported into, as well as exported from, this country. Our Association is the only nationwide organization representing the customs brokerage and international freight forwarding industry.
Our customs broker members are specialists in all facets of the problems relating to the entry and clearance of imported merchandise. They daily handle thousands of import shipments. They are to be found as active members in all of the principal organizations in this country dealing with imports, and they are the advisers to the importing community in connection with technical and everyday customs matters. They frequently are importers of record. If they do not speak in this field on behalf of importers, they are their principal consultants whenever customs problems arise, particularly those matters that take place prior to actual litigation in court.
Our Association supports all of the statements and recommendations made before this Sub-Committee on June 23, 1978 by the American Importers Associ