Customs Law Advisory - Changes in US Law for Customs Protest and Reliquidation

Changes in US Law for Customs Protest and Reliquidation
On December 3, 2004 , the President signed the Miscellaneous Trade and Technical Corrections Act of 2004 (“the Act”), making numerous technical amendments to US trade laws.  Among these changes, the Act doubled the time period in which an importer may file a protest against the liquidation results for a specific entry of imported merchandise.  However, the Act also repealed a long-standing provision of US law that allowed for refunds to be claimed up to one year after liquidation, in certain cases.

US Customs and Border Protection (“Customs”) usually will close the file on (“liquidate”) import shipments (“entries”) approximately ten months after the import date.  Under prior US law at 19 US C. § 1514, a protest of a Customs decision regarding an entry was required to be filed within 90 days after the date of liquidation.  Without a protest, the decision on the amount of duty owing at liquidation is final in most cases, even if the importer overpaid.  Section 2103 of the Act amends § 1514 and extends the time for filing a protest to 180 days after liquidation.

Under prior US law at 19 US C. § 1520(c)(1), a refund requested within one year after liquidation, still could be granted in order to correct “a clerical error, mistake of fact, or other inadvertence . . . not amounting to an error in the construction of a law.”  Only situations meeting this test could take advantage of the longer time for filing a refund request.  Nonetheless, § 1520(c)(1) gave importers an additional option to correct some overpayments (see our Customs Law Advisory dated September 29, 2004:  “Appeals Court Affirms Importers’ Right to Collect Some Duty Refunds Up To One Year After Liquidation”).  Section 2105 of the Act repeals § 1520(c)(1).  Issues involving clerical error, mistake of fact or other inadvertence are now protestable under § 1514.  Thus, although the Act has lengthened the time for protest to six months, it has entirely eliminated the one-year option, regardless of the factual situation.

The Act applies to entries that are filed or withdrawn from warehouse on or after December 18, 2004 .  For any entries made before that date, and especially for any refund claims already filed with Customs, the prior law continues to apply.  We recommend that importers implement revisions to their Customs compliance procedures and compliance manuals to take these new deadlines into account.

If you have any questions regarding US Customs protests or requests for reliquidation, please contact Greg McCue at 202-429-6421.