Merchandise Processing Fee (MPF) Explained

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By Aimee Miller, ABC Customs Brokers Sep 07, 2016

So you have just cleared your first shipment into the United States and the prospects for increasing exports to the U.S. are high; your business plan is coming together.

Upon receipt of your first invoice from your U.S. Customs Broker you notice an additional charge that does not equal the original expenses you had expected. When you inquire, the U.S. Custom Broker explains that every shipment into the U.S. is subject to a Merchandise Processing Fee (MPF). Thankfully your first shipment was low value and the MPF was only $25.

So what can you expect for future shipments?

U.S. Customs and Border Protection (CBP) has been collecting the MPF for years. Recently the fees increased. According to CBP the new rate is “Effective October 1, 2011, the MPF for formal entries is an ad valorem fee of 0.3464 percent. The fee is based on the value of the merchandise being imported, not including duty, freight, and insurance charges. The maximum amount of the fee shall not exceed $485 and shall not be less than $25. For example, if .3464 percent of the amount of your merchandise is greater than the maximum amount of $485, the importer is only required to pay the maximum amount of $485.00.”

How do I calculate MPF?

The easiest way to calculate the amount of MPF you will be charged on your imports into U.S. is to follow this formula:

• For every $7200 of merchandise value you will pay $25 MPF
• You will never pay less than $25 for formal entries (informal entries valued under $2000.00 are subject to a $2.00 MPF)
• You never pay more than $485 (in order to reach this maximum a shipment value of $140,000 is required)
• Lastly, if your goods qualify for any special trade programs, the MPF may very well be exempt

For more information contact us to check if MPF will be applicable on your imports.