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Protests and Appeals

By Sandra Smith

How to Get Your Money Back from US Customs

Occasionally a mistake is made in the entry documents for imported merchandise and you, the importer, pay too much Customs duty. Sometimes Customs sends you a bill for additional duties and you disagree with that action. How do you get your money back? There are several ways, depending on the situation.

First, you need to know a little about "liquidation." When an entry is liquidated, it simply means that Customs is finished looking at it, no further action will be taken on it, and it will be stored, either on paper in the Federal Records Center, or electronically in Customs' computer. The importer receives a "Courtesy Notice of Liquidation" stating the entry number, the liquidation date and the amount of the liquidated duties. It is important to note the liquidation date, because the time limits for the various types of appeals are based on that date.

If the entry has NOT liquidated, you would submit a "Supplemental Information Letter" to Customs, describing the mistake, giving them the correct information and your evidence, and asking for your refund. You have 314 days from the date of entry (or until it liquidates, whichever comes first) for this type of refund request.

If the entry HAS liquidated, and the error is a "clerical error, mistake of fact or other inadvertence not amounting to an error in the construction of the law" you have a year from the date of liquidation to correct the mistake. The law that governs this type of appeal is 19 USC 1520(c)(1) and there are very specific definitions of "clerical error, mistake of fact and other inadvertence." Talk to a broker, consultant or attorney to see if your correction would fall under this provision.

Most refunds can be obtained under 19 USC 1514, the "protest" you hear about from your broker or at seminars. Just about any aspect of the entry of merchandise can be protested under this provision - classification, value, duty rate, charges or fees, denial of drawback, exclusion of merchandise, etc. This type of protest must be submitted to Customs within 90 days after liquidation. You can also submit an "Application for Further Review" to ensure review by an uninvolved third party at the Headquarters (Washington, DC) office of Customs, in the event that the local office denies your claim. If Headquarters also denies the protest, your only real option is to sue in the Court of International Trade in New York.

Filing protests and requests for administrative review is a little more complicated than this article would lead you to believe, but there are ways to get your money back (plus interest) if you have overpaid. You should ask for details from your Customs Broker, attorney or a consultant, or read Parts 173 and 174 of the Customs Regulations.

Tip #1: to avoid having to file protests and petitions, get an advance "binding ruling" from Customs prior to importing your merchandise. These rulings give you the classification and duty rate applicable to the product.

Tip #2: file your claim for refund within 90 days of liquidation. That way, regardless of the reason for the mistake, your claim will be timely.

Tip #3: find out details from an expert

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