Customs Rulings and Protests Tips and Best Practices Atlanta International Forwarders and Brokers Association March 8,

2 Overview of Presentation  Binding Rulings  Contents and practice pointers  Internal Advice  Protests  Modification, revocation and “treatment”

3 Binding Rulings  CBP considers written requests from importers and other interested parties for rulings on a specifically described prospective transaction  A “prospective” customs transaction is one that is contemplated or is currently being undertaken and has not resulted in any arrival or the filing of any entry  A ruling represents the official position of CBP with respect to the particular transaction or issue described therein and is binding on all CBP personnel until modified or revoked

4 Ruling Requests  Request must contain a complete statement of all relevant facts and description of the transaction, including:  names, addresses, and other identifying information of all interested parties (if known)  the name of the port or place at which any article involved in the transaction will arrive  Request must state whether “the same transaction, or one identical to it,” has ever been considered, or is currently being considered by any CBP office or the courts  Where the transaction is but one of a series of similar and related transactions, that fact must also be stated

5 Ruling Requests  Requests can be made of CBP HQ (OR&R) or of the National Commodity Specialists in NY  NY rulings issued in ~30 days  HQ rulings can take 1 year+  NY will forward to HQ if complex; importer can request they do so if NY disagrees with importer’s position  Request should fully state position and lay out the argument and legal support for the position taken  Present all possible arguments  May argue “in the alternative”  Usually best to confront adverse rulings or decisions  May request confidential treatment of trade secrets or privileged or confidential commercial or financial information

6 Ruling Requests  Issues appropriate for ruling requests:  Classification (most common)  Value  Origin, e.g., application of substantial transformation test  Marking, e.g., applicability of exemptions  Preferential treatment, FTA, Chapter 98, etc.

7 Internal Advice  CBP Field Offices may request advice from CBP HQ  Field may request HQ review and modify or revoke a ruling; should provide notice to ruling holder  Importer may request field office seek advice from HQ  Made in writing to the field office  Contain a complete description of the transaction, the specific questions presented, the applicable law, and an argument for the conclusions advocated  Specify whether “the same transaction, or one identical to it,” has ever been considered, or is currently being considered, by any CBP office  Indicate port or ports of entry

8 Protests  CBP administrative decisions involving the following subject matters are protestable:  The appraised value of merchandise  Classification and rate and amount of duties  Charges or exactions  Exclusion of merchandise from entry  Demand for redelivery to CBP custody  Liquidation or reliquidation of an entry  Refusal to pay a claim for drawback;  Refusal to reliquidate an entry under section 520(d) (NAFTA refunds)

9 Protests  Filed with the port director whose decision is protested  Each affected entry must be protested in port of entry  Filed within 180 days of the decision  No exceptions  Include description of the merchandise affected by the decision protested  Include arguments and support or justification for protest  A declaration as to whether the entry is the subject of drawback, or whether the entry has been referenced on a certificate of delivery or certificate of manufacture and delivery

10 Protests - Further Review  Where the port disagrees, protests may be the subject of further review by CBP HQ  Must make an application for further review within the same time period as required for filing the protest  Always include application for further review in protest  Must also state that protestant  Has not previously received an adverse administrative decision from CBP nor has presently pending an application for an administrative decision on the same claim  Has not received a final adverse decision from the courts on the same claim

11 Protests - Further Review  Eligible for further review when the decision against which the protest was filed:  Is alleged to be inconsistent with a ruling of the Commissioner of Customs or his designee, or with a decision made at any port with respect to the same or substantially similar merchandise  Is alleged to involve questions of law or fact which have not been ruled upon by CBP or the courts  Involves matters previously ruled upon by CBP or the courts but facts are alleged or legal arguments presented which were not considered  Is alleged to involve questions which CBP HQ refused to consider in the form of a request for internal advice  19 C.F.R

12 Protests - Further Review  Must include a statement of any facts or additional legal arguments upon which the protesting party relies, including the criterion or criteria set forth in §174.24, which justifies further review  Fill out the AFR section of protest form, but also include written explanation of the basis of entitlement to further review  Explain how one or more of the § criterion applies in your protest

13 Protest Denials  When protest is denied, you have180 days to contest the denial in the Court of International Trade  If a protest is timely and properly filed, but is denied “contrary to proper instructions,” you may, within 90 days after the date of the protest denial, request that CBP void the denial of the protest  If further review was properly requested, and no further review was granted, you may request that CBP HQ “set aside” the port’s denial of further review  Set aside can only be based on the information and grounds set out in the original AFR  Make strong AFR request with protest so you can be sure to receive further review, even if port denies request and you must request set aside

14 Modification and Revocation  CBP may modify or revoke a ruling, internal advice decision or protest decision (further review decision)  If in effect for less than 60 days, CBP may modify or revoke immediately upon written notice to importer  If in effect for 60+ days, then CBP must publish a notice of proposed modification or revocation in the Customs Bulletin, identifying all rulings proposed to be affected  CBP must allow interested parties 30 days to comment on proposal  CBP considers comments and finalizes and publishes modification/ revocation (or abandons proposal)  New ruling takes effect immediately or 60 days after publication (importer choice)

15 “Treatment”  The issuance of a ruling that has the effect of modifying or revoking “the treatment previously accorded by CBP to substantially identical transactions” must be in accordance with the same notice and comment procedures  To establish a “treatment” entitled to such protections:  There must be evidence to establish that:  There was an actual determination by a CBP officer regarding the facts and issues involved in the claimed treatment;  The CBP officer making the actual determination was responsible for the subject matter on which the determination was made; and  Over a 2-year period immediately preceding the claim of treatment, CBP consistently applied that determination on a national basis as reflected in liquidations of entries or reconciliations or other CBP actions with respect to all or substantially all of that person's customs transactions involving materially identical facts and issues  Determination of whether a “treatment” occurred will be made by CBP on a case-by- case basis