Customs New Policy on Post-Importation Claims for Free Trade Agreements
September 18, 2014

This past month, Customs and Border Protection (CBP) published a guidance document prohibiting the use of protests, pursuant to 19 U.S.C. section 1514, as a mechanism to claim duty preferences under free trade agreements and preference programs.  Protests allowed the importer to file a claim with CBP up to 6 months after liquidation of the entry.  According to CBP’s new guidance, protests filed to make a duty preference claim will be denied. Notwithstanding CBP’s long standing practice, going forward, importers will be limited to pre-liquidation claims including under 19 U.S.C. section 1520(d), post summary corrections (PSC’s), and post entry amendments (PEA’s). 

CBP advised that its change in policy reflects decisions of the Court of Appeals for the Federal Circuit and will be revising all internal and external guidelines to reflect those decisions. 

CBP’s August guidance went one step further and listed each FTA or preference program and the attendant post-importation pre-liquidation claim that is available to importers.  Some of the FTA’s specifically provide for claims under 19 U.S.C. section 1520(d).  If a preference program does not have a statutory post-importation mechanism, an importer is limited to post summary corrections and post entry amendments.

In light of CBP’s new policy, importers should take steps to ensure the qualification and to assert their preference claims pre-liquidation in order not to lose the duty benefit.  In addition, a review of liquidated entries would be prudent.

The following preferential trade programs or Free Trade Agreements will be limited to post summary corrections and post entry amendments:

US-Australia FTA

US-Bahrain FTA

US-Israel FTA

US-Jordan FTA

US-Morocco FTA

US-Singapore FTA

AGOA

CBERA/CBTPA

Civil Aircraft Agreement

Generalized System of Preferences

Insular Possessions

Uruguay Round Concession on Intermediate dyes and Chemicals

Pharmaceutical Appendix 

The other FTA’s that include a mechanism for a 1520(d) claim will also continue to accept PSC’s and PEA’s.  Those FTA’s are:

NAFTA

US-Chile FTA

CAFTA-DR

US-Peru FTA

US-Korea FTA

US-Columbia FTA

US-Panama FTA

US-Oman FTA