90-Day Duty Payment Deferral in Response to COVID-19

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April 20, 2020

Customs & Border Protection has issued a CSMS notice alerting the trade to an emergency order from the White House to defer the collection of some duties for goods entered between March 1 and April 30, 2020. A follow-up notce concerning processing payments is here. No interest will be owed on the delayed payments.

This action is fairly limited in its application. Most important, the notices specifically exclude the tariffs that are most likley to be causing economic distress for importers. Duties collected pursuant to antidumping and countervailing duty orders, Section 201, Section 232, and Section 301 are excluded. In other words, the impact of this order will primarily benefit importers making entries between today and April 30 for MFN duties only.

Also, the order does not include a refund of duties already deposited. As a result, the actual application is primarily to entries to be made between today and the end of April. Importers using monthly statement processing may see a more substantial benefit. It also appears that an importer with a positive reconciliation payment due by the end of the month without any trade remedy duties may be able to defer the payment.

To qualify for this deferral, an importer must demonstrate "a significant financial hardship." The starting point for that is that the importer’s operation must be fully or partially suspended during March or April 2020 due to orders from a competent governmental authority limiting commerce, travel, or group meetings because of COVID-19. That business suspension must have resulted in the gross receipts of the importer for March 13-31, 2020 or April 2020 being less than 60 percent of the gross receipts for the comparable period in 2019. Importers taking advantage of this order need not file additional documentation with CBP to be eligible for this relief. However, importers must maintain documentation as part of its books and records establishing that it meets the requirements.