Drawback Claims on Hurricane Sandy & Updated Informal Entry Rule

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Drawback Claims on Merchandise Destroyed by Hurricane Sandy

This message is to provide guidance for claiming drawback on imported goods that were damaged or destroyed during Hurricane Sandy. If duties and taxes were paid and the goods are either exported or destroyed, the goods may qualify for a duty drawback refund under 19 U.S.C § 1313(c).

The importer will be required to provide documentation to U.S. Customs and Border Protection (CBP) with details about the condition of the merchandise, as well as any insurance claims filed. Please note that if the importer has been reimbursed for duties and taxes via an insurance claim, the merchandise is not eligible for drawback.

CBP will waive the requirement to file a CBP Form 7553, Notice of Intent to Export or Destroy, as long as the importer provides detailed supporting documents showing the movement of the merchandise from import through to its ultimate exportation or destruction. This documentation must include the submission of any comprehensive insurance claim filed by the claimant, which indicates to CBP that duties and taxes were not included, as well as third-party destruction documentation which demonstrates to CBP that the merchandise was completely destroyed and will no longer be an article of commerce. All drawback claims which are submitted to CBP should be clearly marked as "Hurricane Sandy" filings to allow for acceptance of the claim with these special requirements.

Please contact your Liberty representative with any questions or concerns.

CBP Publishes Final Rule on Informal Entry Limit and Removal of a Formal Entry Requirement

Currently, for any merchandise valued over $2,000, CBP requires importers to provide a surety bond, complete CBP form 7501, and pay a minimum of $25 in Merchandise Processing Fees (MPF). This final rule published today increases the limit, from $2,000 to $2,500, for which merchandise may qualify for an ``informal entry'', thereby eliminating the need for a surety bond, expediting the customs clearance process, and reducing the required MPF amount to $2 (assuming the entries are filed electronically). CBP is increasing the informal entry limit to mitigate the effects of inflation and in addition, to meet a commitment of the Beyond the Border Initiative between the United States and Canada, to increase and harmonize the value thresholds to $2,500 for expedited customs clearance from the current levels of $2,000 for the United States and $1,600 for Canada.

Eighteen commenters responded to the solicitation of public comments in the proposed rule. These comments can be found at http://www.regulations.gov/#!docketDetail;dct=PS;rpp=25;po=0;D=USCBP-2011-0042. The vast majority of the commenters expressed support for increasing the informal entry limit and/or removing the formal entry list.

This document also removes the language requiring formal entry for certain articles that were formerly subject to absolute quotas under the Agreement on Textiles and Clothing because CBP no longer needs to require formal entries for these articles. This document also makes a technical conforming amendment to reflect a recent statutory amendment that increased the ad valorem Merchandise Processing Fee (MPF) from 0.21 percent to 0.3464 percent. The full ruling can be found at http://www.gpo.gov/fdsys/pkg/FR-2012-12-06/html/2012-29193.htm

This rule is effective January 7, 2013.

FOR FURTHER INFORMATION CONTACT:

Elena Ryan

Acting Director

Trade Facilitation and Administration Division

Office of International Trade, Customs and Border Protection

202-863-6578.

Providence Phone:

401-727-1776

Boston Phone:

617-884-9700

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