Letter from Customs Broker About Duty Deferment (Template for Deferment Application)
The following is a letter from Universal Cargo’s house customs broker concerning the duty deferment for importers whose businesses are suffering from the COVID-19 pandemic.
On April 20, 2020, U.S. Customs and Border Protection (CBP) announced that importers can request a 90-day deferral to pay certain estimated duties, taxes, and fees if you are experiencing a significant financial hardship due to the coronavirus disease (COVID-19). Entries filed in March or April of 2020 are eligible and can be deferred for 90 calendar days from the date that the deposit would otherwise be due. Please read the requirements as defined by CBP and refer to the provided links to determine your eligibility. If you would like to request the 90 day deferral, please provide the following statement on Company Letterhead signed by a member of the importer’s company with the legal authority requesting your customs broker to defer duty payments (Universal Cargo customers, please send these letters to your Account Executive):
On behalf of [IMPORTER], importer of record number [XX-XXXXXX], I confirm that my company satisfies the requirements set forth by CBP in the April 22, 2020 temporary final rule titled, “Temporary Postponement of the Time to Deposit Certain Estimated Duties, Taxes, and Fees During the National Emergency Concerning the Novel Coronavirus Disease (COVID-19) Outbreak,” published at 85 Federal Register 22349. I understand that I may be required to submit proof of our qualification to CBP and instruct [CUSTOMS BROKER] to defer payment of duties on our behalf for all eligible entries by 90 calendar days from the date that the deposit would otherwise be due. I further understand that the deferral does not allow for refunds of duties already paid or apply to certain entries, warehouse withdrawals, antidumping or countervailing duties, or Section 201, 232 or 301 duties. I also hold [CUSTOMS BROKER] harmless of any negligence based on our instructions.
Upon receipt, your customs broker will then determine which entries are eligible to defer payment based on CBP’s instructions and guidelines. Because this is a dynamic process in an evolving landscape, customs brokers do not guarantee that all eligible shipments will be postponed; however, we will do our best to ensure that eligible shipments are deferred on a daily basis.
Significant Financial Hardship:
CBP has defined that an importer will be considered to have a significant financial hardship if the operation of such importer is fully or partially suspended during March 2020 or April 2020 due to orders from a competent governmental authority limiting commerce, travel, or group meetings due to COVID-19, and as a result of such suspension, the gross receipts of such importer for March 13-31, 2020 or April 2020 are less than 60 percent of the gross receipts for the comparable period in 2019.
An eligible importer does not need to file documentation with CBP to be eligible for this relief but must maintain documentation as part of its books and records establishing that it meets the requirements for relief. CBP may also conduct a review of the documentation at a future date to ensure compliance with the requirements.
This temporary postponement of payment of estimated duties, taxes, and fees does not apply to any entry, or withdrawal from warehouse, for consumption, where the entry summary includes merchandise subject to antidumping duties, countervailing duties and/or Section 201, 232 or 301 duties.
In order to take advantage of the 90-day postponement period, importers/filers must ensure their entries do not include merchandise that is ineligible for the postponed payment. If, for example, an entry is filed with merchandise subject to antidumping duties, AND merchandise not subject to antidumping duties, the entire entry will NOT be eligible for the 90-day postponed payment. As an alternative, CBP is authorizing the submission of separate entries pursuant to 19 CFR § 141.52. This authorization only applies to entries that have not yet been filed; it does not apply to entries that have already been filed. So if, as in the above example, a shipment has merchandise subject to antidumping duties, AND merchandise not subject to anti-dumping duties, two separate entries can be made.
[Please note: Customs broker cannot separate entries or docs, customers must separate the docs as desired and create multiple entry requests.]
Estimated duties, taxes, and fees paid on single pay basis or Daily Statement may be postponed up to 90 days from the payment due date. Example:
- Original Due Date 90-Day Postponement
- April 30, 2020 postponed to July 29, 2020
Estimated duties and fees paid via Periodic Monthly Statement (PMS) may be postponed up to three months, as defined by the 15th working day of the third month. Example:
- Original Due Date 3 Month Postponement
- April 21, 2020 to July 22, 2020
- May 21, 2020 to August 21, 2020