Various SKF operating divisions (5251R9N7) have won a U.S. Court of International Trade ruling against the U.S. Department of Commerce.

In essence, SKF for the third time successfully challenged Commerce's practice of issuing liquidation instructions to Customs for duties and tariffs in a particular case, just 15 days after it publishes the final results of its antidumping duty review in that case.

The court has repeatedly held the 15 day period before liquidation is illegal because it is too short to allow companies enough time to digest the antidumping review results, respond properly, and for an appeal to work its way through the system. In fact, duty appeals, trade complaints and duty recalculations can drag on for long periods.

Liquidation is the accounting of duties, fees and taxes owed for each merchandise import, and each entry is liquidated separately. What is important is that when Commerce tells Customs to liquidate the duties for particular imports, the funds are gone -- even if the duties might be successfully challenged as wrong later, by then there are no funds left to collect or refund, and so no way to fix an error.

For example, SKF in this case has challenged Commerce's decision and results in its administrative review of antidumping duties on ball bearings from France, Germany, Italy, Japan and the UK. Even if SKF is successful (which can take months, or years) in appealing and getting a remand for Commerce to review its results, that victory is meaningless if Commerce has issued the liquidation instructions and Customs has long ago disbursed the funds.

Even worse, once Customs receives and processes liquidation instructions in a particular case, there is no remedy available if it is successfully challenged. The trade court has held that when there is no remedy available, then there is essentially no case because nothing can be won, and the challenge is dismissed for lack of jurisdiction.

What often happens now is that companies wishing to challenge an administrative review on dumping duties must rush to the court to request an injunction, preventing the liquidation from happening.

The trade court has repeatedly held that Commerce liquidation instructions conflict with its decision, and that the period must be 60 days, not 15.

In this case, Commerce did not challenge the 15 day situation but instead argued that SKF had no standing because it had only "hypothetical harm" from these specific duties because no duties were actually liquidated yet.

The CIT found that SKF does have standing, and additionally that Commerce's policy of issuing liquidation instructions 15 days after publishing Final Results was "contrary to law."

The court further chastised Commerce, saying, "Commerce twice has applied to SKF a policy that the court has declared to be contrary to law and has given no indication that it will modify that policy or otherwise remedy the continuing harm the court identified in SKF III."