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CBP Offers Clarification on Duty Refunds for FDA Refused Goods

Wednesday, September 21, 2016
Sandler, Travis & Rosenberg Trade Report

U.S. Customs and Border Protection’s Los Angeles field office issued a public bulletin Sept. 19 providing the following information on refunds of duties and fees for Food and Drug Administration-regulated goods that have been refused admission into the U.S.

19 USC 1558 prohibits the remission, abatement, refund, or drawback of duties after the goods have been released from CBP custody unless (1) drawback is permitted by statute, (2) articles entered under bond are destroyed within the bonded period and satisfactory proof of destruction is provided to CBP, or (3) prohibited articles have been regularly entered in good faith but are subsequently exported or destroyed because of a U.S. law.

In general, all FDA-regulated goods are considered restricted goods and therefore not necessarily subject to refunds as described in 19 USC 1558. CBP will not automatically issue refunds on FDA refused goods. CBP will also no longer automatically accept cancellation requests on entries where duties and/or fees were paid and all of the imported goods were exported or destroyed due to FDA refusal but will consider such cancellation requests if no duties and/or fees were submitted.

For FDA refused goods to be subject to a refund as described in 19 USC 1558 they must not in any way be able to be reconditioned to meet U.S. standards. In addition, refunds will not be considered for simply opting not to submit a reconditioning request to FDA.

Importers who believe their goods are prohibited from importation by FDA can file a post-entry claim or protest to obtain a refund. All such protests or claims must contain documentation substantiating that the goods are prohibited. Importers who are unable to establish by a preponderance of evidence that the goods are prohibited may file a CF 7553, Notice of Intent, for a future drawback claim along with the documents required for supervised exportation or destruction when the refused goods are presented to CBP at the time of exportation or destruction.

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