CBP Prohibiting Post-Entry Claims for Select FTA and Preference Programs

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Sandler, Travis & Rosenberg Trade Report Aug 20, 2014

A recent change in practice by U.S. Customs and Border Protection is limiting the right of importers to claim preferential treatment under certain free trade agreements and the Generalized System of Preferences. A CBP public guidance document on this issue is expected in the near future, but in the meantime the change could result in unexpected costs for importers.

Until this change, importers could obtain a refund of duties paid for approximately one year and four months after importation by raising a new claim for preferential treatment. Importers would file a post-entry amendment before liquidation or submit an administrative protest after liquidation. This is consistent with 19 USC 1514, which gives importers the legal right to make post-importation changes to their entries.

Now, however, CBP ports of entry are denying post-importation claims made pursuant to GSP and the U.S. FTAs with Singapore and Australia. Other programs that will likely be affected include the U.S. FTAs with Bahrain, Israel (including the Qualifying Industrial Zones program), Jordan and Morocco as well as the African Growth and Opportunity Act. Imports under agreements mentioned in 19 USC 1520(d), such as NAFTA, CAFTA-DR and the U.S.-Korea FTA, are not impacted.

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