On June 25, 2015, Congress approved, and on June 29, 2015, President Obama signed into law the Trade Preferences Extension Act of 2015 (TPEA), which, among other things, reauthorizes the Generalized System of Preferences (GSP), effective July 29, 2015 through December 31, 2017. The reauthorization applies to otherwise eligible articles that were imported or withdrawn from a warehouse since GSP lapsed on August 1, 2013. Excluded, however, are goods that entered from Russia and Bangladesh, neither of which are currently eligible for GSP benefits. GSP benefits for products from Russia have been terminated while GSP benefits for products from Bangladesh are currently suspended.
The TPEA and a U.S. Customs Border and Protection (CBP) directive (here) set out requirements that must be followed in order for importers to obtain GSP benefits retroactively.
Retroactive Duty Refunds
Under the TPEA, any entry of a covered article eligible for preferential treatment that was made after July 31, 2013 and before July 29, 2015 shall be liquidated or reliquidated as though such entry occurred before the program expired. CBP will continue to collect the duty on GSP eligible entries through July 28, 2015. Importers can claim their duty refunds by filing a request for liquidation or reliquidation with CBP within 180 days of the TPEA’s enactment, i.e., by December 28, 2015. CBP will refund the duties no later than 90 days after the liquidation or reliquidation, but no interest will be paid on those refunds.
Automation. CBP has developed a mechanism to facilitate automatic refunds for duties deposited on GSP eligible goods for those entries submitted during the lapse period from August 1, 2013 through July 28, 2015 which claimed GSP by using the Special Program Indicator (SPI) “A,” “A+,” or “A*.” No action by importers will be required for entries filed with those SPIs during the lapse period. CBP expects to start issuing GSP refunds for these flagged entries shortly after July 29, 2015.
Formal/Informal Entries. For unliquidated Automated Commercial Environment (ACE) entry summaries where no SPI was transmitted, retroactive GSP claims must be made using Post-Summary Correction (PSC), as long as the claim meets the TPEA’s 180-days filing requirement noted above (i.e., by December 28, 2015) and the PSC’s requirement of filing within 270 days of entry.
For all other entries made without using the SPI indicator, ACE entries beyond the 270-day PSC period and non-Automated Broker Interface summaries, importers must affirmatively and in writing request a refund from the port of entry. The request may cover either single entry summaries or all entry summaries filed by an individual filer at a single port, and must be submitted by December 28, 2015. The request must contain sufficient information to enable CBP to locate an entry. Specifically, CBP recommends that the written request contain the following:
- A statement requesting the refund;
- An enumeration of the entry numbers and line items for which refunds are requested; and
- The amount requested to be refunded for each line item and the total amount owed (not including interest) for all entry summaries.
Such a request will likely entail cooperation between importers and their customs brokers.
Mail Entries. The addressees on mail entries must submit a claim for a refund, along with a copy of the CF 3419A, to the relevant International Mail Branch. CBP considers the copy of the CF 3419A to be the only means of identifying whether GSP products have been entered and estimated duties and fees have been paid for mail entries.
Other Conforming Requests for a Refund. CBP has indicated that a traveler’s or importer’s statement on his/her Customs declarations (CF 6059B) or informal entries (CF 363 or CF 7501) requesting a refund, excluding interest, would be treated as a conforming request for a refund. However, an importer’s failure to request a refund in this manner does not preclude him/her from otherwise making a timely written request to CBP.
The TPEA amends the GSP to authorize the designation of cotton articles classified under Harmonized Tariff Schedule of the United States subheadings 5201.00.18, 5201.00.28, 5201.00.38, 5202.99.30, or 5203.00.30 as eligible articles, but only if produced in “least-developed developing countries.” The TPEA also allows the President to designate certain luggage and travel-related articles as GSP eligible.
On July 6, 2015, the United States Trade Representative (USTR) published a notice in the Federal Register launching a limited and expedited GSP product review of goods that are subject to competitive need limitation (CNL)-related actions based on import volumes in 2014. Requests for waivers of a CNL must be filed by July 31, 2015. The results of this review are due by October 1, 2015. In August 2015, USTR will initiate the 2015 GSP Annual Review in which interested parties will be able to submit petitions to add or remove products from the list of those eligible for duty-free treatment under GSP. The results of that annual review will be due on July 1, 2016.
Other Preference Program Extensions
The TPEA also extends the African Growth and Opportunity Act for 10 years beyond the September 30, 2015 expiration date and two preferential programs for Haiti for an additional five years beyond their current 2020 expiration date.