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On September 27, U.S. Customs announced plans to conduct a prototype test
to determine the feasibility of filing paperless drawback claims. What does this mean to you? What do we know about this program?
Who Can Apply?
For this testing period, only those drawback filers who file claims at the New York/Newark Drawback Center may participate. (Drawback claimants who wish to participate in this prototype program must have submitted applications to Customs no later than October 28, 2002.)
Why Only New York/Newark Drawback Center?
In response to last years terrorist attacks that destroyed the New York Customhouse at 6 World Trade Center, Customs is hoping to reconstruct those drawback claims lost in the attacks. By focusing in on this one region, Customs can hopefully assess the feasibility of a nationwide electronic drawback-filing program.
Is It A Viable Program?
It is obviously too early to say at this point. But I, and many people I've spoken with in the industry, believe what Customs has outlined is unusable. As structured, it is useless for manufacturing substitution because Customs does not have any edit checks for basic statutory compliance - except for the date of initial export. Any paperless program for duty drawback should insure that the basic criteria for validation is met and should also capture as much important data as possible for statistical purposes. The proposed program from Customs doesn't seem to offer either of these. It is unlikely that Customs decision makers will approve another test a year from now, therefore it is critical that Customs address the program's shortcomings and get it right the first time.
What's next?
In spite of the programs shortcomings, it appears that Customs is going to continue with the test by accepting applications from the drawback community for all types of drawback claims. Customs may just cover their tracks by not approving certain types of drawback for this program - without actually coming out and saying why. We'll just have to sit back and watch.
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