CBP Issues Instructions regarding GSP and ATPA Extensions, Announces MPF Rate Change

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October 26, 2011

U.S. Customs and Border Protection (CBP) has issued two memoranda concerning the renewal of the Generalized System of Preferences (GSP) and the Andean Trade Preference Act (ATPA) programs on November 5, 2011. CBP's memoranda outlines the procedures for duty refunds for entries filed during the period in which GSP lapsed (January 1, 2011 through November 4, 2011) and ATPA lapsed (February 13, 2011 through November 4, 2011). President Obama signed into law renewal legislation for the Generalized System of Preferences ( GSP) and Trade Adjustment Assistance (TAA), as well as implementing legislation for the Korea, Panama and Colombia Free Trade Agreements (FTAs), on October 21, 2011. The Colombia FTA implementing legislation includes a retroactive renewal of the Andean Trade Preferences Act (ATPA), through July 31, 2013. The instructions for requesting refunds under both the GSP and ATPA programs, as well as an update regarding MPF Rate changes, are set forth below.

GSP Refunds

On October 21, 2011, the President signed H.R. 2832, which will extend the GSP program from November 5, 2011 through July 31, 2013. Please note, CBP has indicated that the effective date of the GSP extension will be for entries made on or after November 5, 2011, not November 6, 2011 as previously reported. H.R. 2832 also allows for the refund of all duties paid on GSP-eligible merchandise that was entered or withdrawn from warehouse for consumption during the January 1, 2011 through November 4, 2011 period when GSP was in lapsed status.

Filers are entitled to file GSP-eligible entry summaries, utilizing the Special Program Indicator (SPI) "A," without the payment of duty for shipments entered or withdrawn from warehouse for consumption on or after November 5, 2011.  CBP has announced that it will begin processing refunds immediately for entries filed via ABI with the SPI "A," for duties deposited on GSP-eligible goods during the period from January 1, 2011 through November 4, 2011.  CBP advises importers to contact the appropriate port of entry for inquiries about the status of their refunds.

For ACE entry summaries where no SPI "A" was transmitted, retroactive GSP claims must be made via post-summary correction, where applicable, i.e., if the entry meets the time requirements for PSC filing.   CBP has previously stated that PSCs can only be submitted within 270 days of the date that CBP accepted the entry.  As the GSP program expired on December 31, 2010, some entries made in early 2011 may be outside the PSC time window.  GSP refund requests for all other entry summaries (e.g., warehouse withdrawals, change liquidations, re-liquidations, and suspended entry summaries) where no SPI "A" was transmitted will be processed in accordance with normal liquidation or re-liquidation procedures.

Claims may be made via post-entry amendment (PEA) or protest, as long as they meet the applicable time requirements. Any amounts owed by the U.S. pursuant to the liquidation or reliquidation of an entry will be paid without interest.

A liquidation or re-liquidation may be made with respect to an entry only if a request is filed with CBP no later than 180 days after the October 21, 2011 enactment of the law containing the GSP renewal provision (i.e., approximately April 18, 2012).  Requests for refunds must be made in writing and must contain sufficient information to enable CBP to locate the entry.  To expedite the refund, CBP recommends that the request indicate the entry number, line number, and requested refund amount. ( CBP Notice)

ATPA/ATPDEA Refunds

On October 21, 2011, the President signed H.R. 3078, which extends both the Andean Trade Preference Act (ATPA) and the Andean Trade Promotion and Drug Eradication Act (ATPDEA) programs through July 31, 2013.  The ATPA/ATPDEA programs lapsed on February 12, 2011 and have been retroactively renewed for Ecuador and Colombia, allowing for a refund of all duties paid on ATPA/ATPDEA eligible merchandise that was entered or withdrawn from warehouse for consumption while the program was lapsed (from February 13, 2011 through November 4, 2011).

Filers are entitled to file ATPA/ATPDEA eligible entry summaries, utilizing the Special Program Indicators (SPI) "J, J+" without the payment of duty for shipments entered or withdrawn from warehouse for consumption as of November 5, 2011.  For ACE entry summaries, retroactive ATPA/ATPDEA claims must be made via post-summary correction, where applicable, i.e., if the entry meets the time requirements for PSC filing.   CBP has previously stated that PSCs can only be submitted within 270 days of the date that CBP accepted the entry.  

Claims may be made via post-entry amendment (PEA) or protest, as long as they meet the applicable time requirements. Any amounts owed by the U.S. pursuant to the liquidation or reliquidation of an entry will be paid without interest.  In order to process a refund, CBP requires the following information:

1. A statement that the letter is a request for a refund as provided for under H.R. 3078.
2. The entry numbers and line items for which refunds are being requested; and
3. The amount of be refunded for each line item; and where multiple entries are involved, the total amount for all entry summaries.

A liquidation or re-liquidation may be made with respect to an entry only if a request is filed with CBP no later than 180 days after the October 21, 2011 enactment of the law containing the ATPA renewal provision (i.e., approximately April 18, 2012).  

Note that a memorandum addressing ATPA concerns for quotas and textiles will be issued shortly.  CBP is awaiting information from the Committee for the Implementation of Textile Agreements (CITA) prior to issuing this direction. (CBP Notice)

MPF Rate Change

On October 21, 2011, U.S. Customs and Border Protection (CBP) issued a Cargo Systems Messaging Service notification (CSMS #11-000262 ) stating that it is in the process of modifying its automated system (ABI) to accept the new Merchandise Processing Fee (MPF) rate of 0.3464%, which is effective as of October 1, 2011. The minimum merchandise processing amount of $25 and maximum merchandise amount of $485 have not changed. CBP is in the process of making the necessary modifications to its automated system and does not have an exact date for when the changes will be completed. CBP's message states that the agency will notify the trade industry approximately one week before they can begin submitting their summaries to ACS and ACE with the new MPF rate.

Recent trade legislation raised the MPF rate for formal entries from 0.21% to 0.3464% for the period from October 1, 2011, to June 30, 2021. The 0.3464% rate is effective continuously for this period as the Korea FTA bill was enacted after the GSP bill.

If you have any questions concerning these instructions or would like assistance in preparing refund requests to submit to CBP, please contact a Barnes/Richardson attorney.