Law Firm Says CBP Not Allowing Post-Entry USMCA Claims to Avoid 25% Tariffs
Roll and Harris, a law firm specializing in customs law, put out a newsletter alerting clients that they should not assume that they can amend an entry to say that Canadian or Mexican goods qualify for USMCA if their initial entry summary didn't.
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The update, which they noted is not legal advice, said the language of the executive orders creating the carve-out to the tariffs on imports from those two countries said that "Articles that are entered free of duty ... under the terms of general note 11 to the HTSUS ... shall not be subject to the additional ad valorem rate of duty" from the executive orders that imposed 10% duties on Canadian energy products and potash, and 25% duties on all other Mexican and Canadian imports.
"Normally, USMCA treatment can be, and is, claimed at the time of entry. Importers typically claim USMCA by placing the "S" special program indicator in front of the regular tariff classification of the goods or, in some cases, by using a particular provision of Chapter 98 of the Harmonized Tariff Schedule of the United States," the lawyers wrote March 14.
However, if the importer is not sure at the time of entry if the goods qualify, or if the importer doesn't have a certificate of origin from the producer, they have, in the past, paid duties at entry, and then could assert the USMCA claim for up to one year afterward, and get a refund.
"It has come to our attention that some CBP officials are stating that for situations where duties are paid at entry and a USMCA claim is filed after importation (i.e., within the one-year time period), only the regular/normal duties will be refunded, not the 25% tariffs," they wrote.
They said they don't know if the language was sloppy draftsmanship, or that restriction is intentional. They also wrote that they don't know "whether the position that it is not possible to file a post-entry USMCA refund claim to recoup the 25% tariffs paid at importation is that of just certain CBP officials or represents official CBP policy."
However, they said, given that the deadline to file entry summaries for March 7, when the rule changed to allow the carve-out, is next week, importers should consult with their lawyers or brokers.