(or things not to do when filing a drawback claim)
Everyone has pet peeves. For some folks, its fingernails on a chalkboard that gets 'em everytime. For others, it’s the sound of a knife being sharpened. For U.S Customs Drawback Specialist, it’s having to disallow a claim, or liquidate a claim at xero because simple, but required, information on a claim is incorrect, incomplete, or missing entirely.
One of the most common mistakes that claimants make involves their I.R.S number. The I.R.S number is a "corporate fingerprint" that facilitates ACH and allows U.S Customs to readily identify the corporate entity filing a drawback claim. Claimants frequently do not include the two digit suffix of their I.R.S number on a drawback claim. A large number of I.R.S number include suffixes other than "00" and Customs cannot assume that the missing suffix on an I.R.S number is "00". Even if your I.R.S suffix is "00" it must be included.
Another common error involves proof of export. A drawback claimants is required to supply proof of export to U.S. Customs within 90 days of the presentation of the claim. Failure to provide proof of export within the prescribed time period can result in your claim being liquidated at zero!
We all hate filling out forms, but it’s amazing how simple information can be overlooked and omitted. For example, Customs often receives CF7539J forms (Unused Merchandise Drawback) with blocks 20, 21 and 31 through 33 missing. Even though the form is blatantly intended for use with unused drawback claims, it is extremely important that the claimants declare whether the merchandise was exported or destroyed (box # 20) and that the declarant sign in box #21. Likewise, the affidavit of some condition (box #31) must be completed, dated (box #32) and signed (box #33). Be meticulous when completing forms! No matter how accurate and well-organized your claim attachment are, the initial review of any claim centers on making sure that all basic information required on a claim is provided.
Believe it or not, Customs receives claims that show imports in one unit of measure and exports in another. For example, imports may be in meters, while exports are in feet! The Drawback Specialist reviewing such a claim can hardly be expected to manually convert imports to feet or exports to meters. Double check your units of measure, and type of currency. Above all, be consistent!
Finally, some claimants send in attachments that they have created without regard to the information required by customs (i.e. missing required information and including information not required). Such creativity on the part of a claimants will, at the very least, stall the processing of a claim and only serves to make the specialist’s job more difficult.
Unfortunately a Drawback Specialist rarely receives a claim that is complete and correct. U.S. Customs in Houston estimates approximately 10% of all claims filed can be reviewed and immediately liquidated. Because Drawback Specialists are rated by the number of claims that they liquidate, it is in their interest to facilitate the liquidation process. However, it is the claimants responsibililty to ensure that the information Customs receives is complete and accurate.
Compliance, Compliance, Compliance!!
If you have not already begun to revamp your existing internal duty drawback manual (or don’t even have one), now is definitely the time. With the April publication of the new drawback regulations out, U.S. Customs is telling drawback filers that they must have available their drawback manuals when reapplying for priviliges. Call your drawback liquidator to find out where you stand on this new process.
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