The President, acting on a report and recommendation of the
Tariff Commission pursuant to the flexible tariff provisions of the
Tariff Act of 1930, proclaimed an increase of duty on a Japanese
product to equalize the difference between Japanese and domestic
costs of production. In fixing the increase, foreign cost of
production was determined, under § 336(e), on the "weighted average
of the invoice prices or values for a representative period,"
taking as representative the period from December 1, 1930, to
September 30, 1932; but, as the invoice prices were in yen, and as
§ 336 contains no provision for conversion of currency, the
Commission, in order to compare those prices with domestic cost,
had converted them into dollars at the average rate of exchange for
1932, selecting that period because the value of yen in dollars had
declined steadily from December, 1931, to November, 1932.
Held:
1. There is no express provision in the Act requiring that the
rate of exchange be taken from the same period as the invoice
prices, and none can be implied. P.
310 U. S.
378.
2. The President's judgment in the matter is not subject to
scrutiny by the Court of Customs and Patent Appeals or by this
Court. P.
310 U. S.
379.
3. Section 501 of the Act does not permit judicial examination
of the judgment of the President that the rates of duty
recommended
Page 310 U. S. 372
by the Commission are necessary to equalize the differences in
dometic and foreign costs of production. P.
310 U. S.
379.
4. Under § 336, the Commission serves the President as an
adviser. It is the judgment of the President on the facts submitted
to him by the Commission that determines whether or not the
recommended rate will be promulgated. P.
310 U. S.
379.
5. In substance, and to a large extent in form, the action of
the Commission and the President is but one stage of the
legislative procss. P.
310 U. S.
379.
27 C.C.P.A. ___, 104 F.2d 368, reversed.
Certiorari, 309 U.S. 643, to review a judgment of the Court of
Customs and Patent Appeals ordering a reappraisement under § 501 of
the Tariff Act of 1930.
Page 310 U. S. 375
MR. JUSTICE DOUGLAS delivered the opinion of the Court.
The Court of Customs and Patent Appeals held invalid the
Proclamation made by the President of the United States on May 1,
1934, No. 2081, 48 Stat. 1739, increasing the duty on canned clams
imported from Japan. 104 F.2d 368. We granted certiorari because of
the importance of that decision
Page 310 U. S. 376
to the administration of the flexible tariff provisions of the
Tariff Act of 1930, 46 Stat. 590, 309 U.S. 643.
In compliance with § 336(a) of that Act, the Tariff Commission,
in response to an application for an increased duty on canned
clams, instituted an investigation in June, 1932, gave public
notice of the hearing, held the hearing in October, 1932, and gave
interested parties an opportunity to be present, to produce
evidence, and to be heard. As a result of that investigation, the
Commission found that the statutory duty of 35%
ad valorem
on the foreign dutiable value [
Footnote 1] did not equalize the difference in the costs
of production of the domestic article and the Japanese article. On
such a finding, the Commission was authorized by § 336(a) to
recommend to the President an increase or decrease in the statutory
rate, but not in excess of 50 percent; or, in case the differences
could not be equalized in that manner, it was empowered by § 336(b)
to specify such
ad valorem rate of duty based upon the
American selling price [
Footnote
2] of the domestic article as it found necessary to equalize
such differences. In the latter event, however, the statutory rate
could not be increased. The Commission found that the rate of duty
on foreign value which would be necessary to equalize the
difference in costs exceeded the then existing statutory rate by
more that 50 percent. Accordingly, it proceeded under § 336(b) to
specify an
ad valorem rate based on American selling
price, and recommended to the President an increase in the duty, to
be effected by assessing the rate of 35 percent
ad valorem
on the American selling price.
It is provided in § 336(c) that the President
"shall, by proclamation, approve the rates of duty and changes
in classification and in basis of value specified in any report of
the commission under this section if, in his judgment,
Page 310 U. S. 377
such rates of duty and changes are shown by such investigation
of the commission to be necessary to equalize such differences in
costs of production."
The Proclamation referred to the report and findings of the
Commission and concluded that the change in duty recommended was,
"in the judgment of the President," necessary for that purpose.
After the President issued his Proclamation, respondent imported
some canned clams and they were appraised on the basis of the
American selling price. It was on an appeal for reappraisement
pursuant to § 501 that the Proclamation was held invalid by the
Court of Customs and Patent Appeals. Its invalidity, according to
that court, flowed from the basis on which the Commission computed
the Japanese cost of production. By § 336(e)(2), the Commission was
authorized, when the cost of production of a foreign article was
not "readily ascertainable," to accept as evidence thereof the
"weighted average of the invoice prices or values for a
representative period." The Commission took the weighted average of
such prices for the period from December 1, 1930, to September 30,
1932. Those prices were in Japanese yen. Sec. 336 contains no
provision for conversion of currency. But the Commission, in order
to compare those prices with domestic costs, converted them into
United States dollars at the average rate of exchange for 1932.
That period was selected because Japan went off the gold standard
in December, 1931, and the value of the yen in terms of United
States dollars declined steadily from that date to November, 1932.
[
Footnote 3]
Page 310 U. S. 378
The Court of Customs and Patent Appeals held that it was error
to convert invoice prices for one period into United States dollars
at the average rate of exchange for another period. In its view,
the phrase "weighted average of the invoice prices of values for a
representative period" contained in § 336(e)(2) must be construed
as though it read, "weighted average of the invoice prices or
values in United States currency for a representative period." The
government, however, urges that, if the Commission were forced to
take the conversion rate for the earlier period, to which it had to
resort in order to obtain the invoice prices, it would use a rate
which had merely an historical interest, and which did not reflect
the conditions which made desirable an increase in duties --
viz., the depreciation in the value of the yen.
The determination of foreign exchange value was prescribed, in
the procedure outlined by Congress, neither for the action of the
Commission nor for that of the President. [
Footnote 4] There is no express provision in the Act
that the rate of exchange must be taken for the same period as the
invoice prices. To imply it would be to add what
Page 310 U. S. 379
Congress has omitted and doubtless omitted in view of the very
nature of the problem. The matter was left at large. The
President's method of solving the problem was open to scrutiny
neither by the Court of Customs and Patent Appeals nor by us.
Whatever may be the scope of appellate jurisdiction conferred by §
501 of the Tariff Act of 1930, [
Footnote 5] it certainly does not permit judicial
examination of the judgment of the President that the rates of duty
recommended by the Commission are necessary to equalize the
differences in the domestic and foreign costs of production.
The powers which Congress has entrusted to the President under
the Act of 1930 do not essentially differ in kind from those which
have been granted him under the tariff acts for well over a
century.
See Norwegian Nitrogen Products Co. v. United
States, 288 U. S. 294,
288 U. S. 308
et seq., for a review of the statutes. Since its creation
in 1916, the Commission has acted as an adviser to the Congress or
to the President. Under § 336 of the Act of 1930, the Commission
serves the President in that role. It does not increase or decrease
the rates of duty; it is but the expert body which investigates and
submits the facts and its recommendations to the President. It is
the judgment of the President on those facts which is determinative
of whether or not the recommended rates will be promulgated. In
substance and to a great extent in form (
Norwegian Nitrogen
Products Co. v. United States, supra), the action of the
Commission and the President is but one stage of the legislative
process.
Hampton & Co. v. United States, 276 U.
S. 394. "No one has a legal right to the maintenance of
an existing rate or duty."
Norwegian Nitrogen Products Co. v.
United States, supra, p.
288 U. S. 318.
And the judgment of the
Page 310 U. S. 380
President that, on the facts, adduced in pursuance of the
procedure prescribed by Congress, a change of rate is necessary is
no more subject to judicial review under this statutory scheme than
if Congress itself had exercised that judgment. It has long been
held that, where Congress has authorized a public officer to take
some specified legislative action when, in his judgment, that
action is necessary or appropriate to carry out the policy of
Congress, the judgment of the officer as to the existence of the
facts calling for that action is not subject to review.
Martin v. Mott,
12 Wheat.19;
Monongahela Bridge Co. v. United States,
216 U. S. 177;
Dakota Central Telephone Co. v. South Dakota, 250 U.
S. 163;
United States v. Chemical Foundation,
Inc., 272 U. S. 1. As
stated by Mr. Justice Story in
Martin v. Mott, supra, pp.
25 U. S.
31-32:
"Whenever a statute gives a discretionary power to any person,
to be exercised by him upon his own opinion of certain facts, it is
a sound rule of construction that the statute constitutes him the
sole and exclusive judge of the existence of those facts."
For the judiciary to probe the reasoning which underlies this
Proclamation would amount to a clear invasion of the legislative
and executive domains. Under the Constitution, it is exclusively
for Congress, or those to whom it delegates authority, to determine
what tariffs shall be imposed. Here, the President acted in full
conformity with the statute. No question of law is raised when the
exercise of his discretion is challenged.
The other points raised are so unimportant as not to merit
discussion.
Reversed.
MR. JUSTICE McREYNOLDS is of the opinion that the judgment below
should be affirmed.
[
Footnote 1]
§ 1, Sch. 7, Par. 721(b).
[
Footnote 2]
As defined in § 402(g).
[
Footnote 3]
The Commission in its report to the President, dated April 5,
1934, stated on this point:
"The years 1931 and 1932 are representative with respect to the
domestic cost of production of canned clams and the invoice prices
of Japanese canned clams, in terms of Japanese currency. During
most of 1931, the exchange rate of the Japanese yen for the dollar
was not much below par, whereas, since that time, it has been much
below par. For this reason, the invoice prices of the Japanese
product imported in 1931, when converted to dollars at the then
current rate of exchange, are not representative of the present or
probable future invoice values in terms of dollars. The Commission
has therefore used, for comparison with the domestic costs, the
invoice prices in yen as evidence of costs of the Japanese product
during 1931 and 1932, converted to dollars at the average rate of
exchange for 1932. Although the exchange rate of the yen has risen
since April, 1933, the rate now prevailing is not much higher than
the average rate for 1932."
[
Footnote 4]
Sec. 522(b) provides that, for "the purpose of the assessment
and collection of duties" upon imports, foreign currency shall be
converted at values proclaimed by the Secretary of the Treasury for
the quarter in which the merchandise was exported. This section
clearly has no application to the issue here, since it applies only
to assessment and collection of duties matters outside the
functions and duties of the Tariff Commission.
[
Footnote 5]
That section gives either party a right to appeal to the Court
of Customs and Patent Appeals on "a question or questions of law
only."