In a recent lawsuit brought to the Court of International Trade (CIT), importers argued that they should still be able to apply for Section 301 exclusion refunds for liquidated entries, specifically, after the protest deadline has expired. The plaintiffs challenged Customs and Border Protection’s (CBP) failure to adjust the liquidated entries under applicable exclusions as a “wrongful possession.” The Department of Justice (DOJ), however, has dismissed the litigation, citing plaintiff failure to adhere to the administrative process guidance in filing the appropriate Protest published by CBP.
Options for Section 301 Exclusions Refunds on Entries Facing Liquidation Deadline:
OPTION 1
Request an extension of the liquidation deadline
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File post-summary correction (PSC) no later than 15-days before the extended date of liquidation
OR
OPTION 2
File a protest within the 180-day period following liquidation.
The DOJ ruled that the “plaintiffs failed to file administrative protests within the statutory deadline for the particular entries covered by their amended complaints, despite having clear notice that the filing of a protest was necessary to take advantage of any change in the duty rate” and that a “timely protest would have allowed CBP to correct the liquidation and apply the exclusion decision.”
5 STEPS TO THE PROTEST PROCESS FOR SECTION 301 EXCLUSIONS:
Step 1 – Identify any pending product exclusion decision from USTR as a basis for the protest
Step 2 – Once USTR officially makes a decision regarding a product exclusion, protest must submit exclusion information to CBP
Step 3 – After a protest is filed. CBP will postpone making a determination on protests that include a claim identifying a pending product exclusions.
Step 4 – Once USTR completes the exclusion processing, CBP will process these protests pursuant to USTR’s exclusion determination.
Step 5 – CBP will refrain from denying or granting a party’s protest before the importer receives a final determination from USTR regarding its product exclusion request.
CBP issued several CSMS guidance notices, detailing the process for liquidating entries that were still pending USTR exclusion determinations in May 2019 and 2020:
REQUESTS FOR EXTENSION(S) OF LIQUIDATION FOR PENDING PRODUCT EXCLUSION REQUESTS
Approved requests extend the liquidation of an entry summary for one year.
When a product exclusion is granted, an importer may submit a PSC to request a refund on the entry summary(ies). If a product exclusion is not approved, no further action is taken, and the entry summary will liquidate as entered one year later than the originally scheduled liquidation date.
If necessary, the importer or their filer may request subsequent liquidation extensions for a total of not more than three years as mandated by 19 CFR 159.12.
CSMS# 19-000260 – Section 301 Products Excluded from Duties – Liquidation Extension Request – May 22, 2019
CSMS #42566154 – Section 232 and Section 301 – Extensions Requests, PSCs, and Protests – May 19, 2020
IMPORTERS & EXPORTERS NEED A RELIABLE COMPLIANCE PARTNER TO GUIDE THEM THROUGH THIS REGULATORY MAZE
meet kate rayer
Global Trade Manager, LCHB
Green Worldwide Shipping, LLC
