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Wheatland Tube disappointed that CBP is not investigating duty evasion on steel pipe from China

Chicago-based steel tube producer Wheatland Tube, a division of Zekelman Industries, filed an allegation of duty evasion with the U.S. Customs and Border Protection (CBP) in September, providing public import data demonstrating that the 56,774 metric tons of welded pipe imported by Company "X" from China since November 2015 were subject to the AD/CVD orders, requiring cash deposits in excess of $81.5 million. Wheatland acknowledged that it did not have access to the confidential CBP import data that would be necessary to prove duty evasion and urged CBP to review such data.

Wheatland now expresses its disappointment that CBP has decided not to investigate its allegation of duty evasion on imports of Chinese circular welded pipe. This pipe is being used in solar projects, which may receive federal tax breaks.

"I am disheartened by this news," said Barry Zekelman, chairman and CEO of Zekelman Industries. "We followed the rules set forth by the Enforce and Protect Act and the EAPA regulations of CBP. This law was enacted for this type of situation. If Customs won't even investigate the claim, which they have the data and the ability to do, what protections are there for legitimate U.S. manufacturers who pay U.S. taxes and create jobs for Americans?"

According to CBP, Wheatland's "allegation reasonably suggests that Company ‘X’ imported merchandise from China that may be subject to AD/CVD order. But the allegation does not reasonably suggest that merchandise was entered through evasion. Evidence of importation, without more, is not sufficient to raise a reasonable suspicion of evasion."

Wheatland states that CBP appears to have set an impossible standard for initiating EAPA investigations by requiring that domestic producers prove, not just allege, duty evasion. According to the tubemaker, CBP is the proper party to determine if evasion occurred since it maintains the relevant import data, and it is impossible for domestic parties to make this determination.

"At the very least, we would like CBP to use the data that they have already collected regarding the importing of this product to determine if duties were properly paid," said David Seeger, president of Zekelman Industries.