CBP Issues Instructions on Filing & Substantiating Claims under the US-Chile FTA

CBP continues to state that until further notice, such UCFTA claims must be filed non-ABI. In addition, CBP states these instructions are subject to change once its UCFTA regulations are issued.

(The memorandum also gives an overview of the UCFTA, covering i) its general rules for originating textile and originating non-textile articles along with their de minimis provisions and exceptions, ii) its Tariff Preference Levels (TPLs) for certain non-originating fabrics and apparel and the statement of eligibility that is required from the importer at time of entry, when making such a UCFTA TPL claim, iii) UCFTA Tariff Rate Quotas (TRQs) for certain agricultural goods, iv) etc.

Use of SPI "CL" to Make a Claim for UCFTA "Originating Goods" or TPL Goods

According to the memorandum and CBP sources, a claim for UCFTA preferential treatment for originating goods or TPL goods may be filed at the time of entry summary by placing the Special Program Indicator (SPI) "CL" as a prefix to the HTS tariff number for each good or line item for which treatment is being claimed.

The UCFTA also permits post-importation claims for the preferential treatment of originating goods. CBP states that the importer may make a claim no later than one year after the date of importation. The post-importation claim must include certain documentation as specified in the memorandum.

Certification for "Originating Goods" to be Submitted to CBP Upon Request

At the request of CBP, the importer shall submit a certificate of origin or supporting documents (certification) to demonstrate that the imported goods are originating and qualify for UCFTA preferential tariff treatment.

The certification is not required to be on file at the time the claim is made. However, the importer is responsible for retaining this certification, which may be requested by CBP. The certification shall be submitted in English or Spanish. If submitted in Spanish, CBP may request an English translation.

Certification for originating goods must contain certain data elements and language. CBP states the certification need not be in a prescribed format. It may take many forms, such as a statement on company letterhead, a statement on a commercial invoice or supporting documentation which demonstrates that the imported good qualifies for UCFTA preferential treatment. The certification must contain certain data elements, including certain language, as follows:

Legal name, address, telephone and e-mail of the importer of record, exporter of the good (if different from the producer), and producer of the good (if known);

Harmonized System (HS) description of the good;

HS tariff classification number;

Applicable UCFTA preference criterion;

Commercial invoice number for a single shipment;

Blanket period for multiple shipments of identical goods (12-month maximum);

Authorized signature, company, title, telephone, fax, e-mail, and certification date; and

Certification language. This language, among other things, states that the information is true and accurate, that the goods comply with the origin requirements of the UCFTA, and that the importer assumes liability for any false statements or material omissions and responsibility for proving the representations therein. (See memorandum for text.)

Importer is responsible for accuracy of certification for originating goods. According to CBP, an importer may submit to CBP a certification that is completed or generated by an exporter or producer, or may issue the certification based on information submitted by the exporter or producer that the good qualifies as originating; however, the importer must exercise reasonable care when certifying to the accuracy and truthfulness of the information submitted to CBP. The fact that the importer has issued a certification based on information provided by the exporter or producer or submits a certificate of origin executed by the exporter or producer does not relieve the importer of the responsibility to exercise reasonable care.

Single entry or blanket certification for originating goods. CBP states that the importer may file a certification for a single entry. Alternatively, the importer may file a blanket certification for multiple importations over a period not to exceed 12 months, which may be valid for one or more originating goods.

Certification usually not required for goods valued at $2,500 or less. According to CBP, a certification shall not be required for an importation of goods that claim to be UCFTA originating that have an F.O.B. value of $2,500 or less, unless CBP considers the importation to be carried out or planned for the purposes of evading U.S. laws and regulations.

In addition, CBP states that if it conducts a verification to determine if the goods are in compliance with other CBP laws and/or regulations, CBP may require the importer to furnish a certification regardless of the monetary value of the good.

Importers must maintain records for 5 years. CBP notes that importers are required to maintain records in the U.S. for five years after the date of importation, including the certification, if completed, and all records relating to the importation of the good.

CBP's Verification of a UCFTA "Originating Goods" Claim

Inquiries regarding verification via a CBP Form 28. CBP states that the UCFTA places the burden of substantiating the validity of the claim for preferential tariff treatment on the importer. An importer may make a claim based on knowledge or information in his/her possession that the good qualifies as an originating good. CBP may verify the validity of the claim and will direct inquiries for verification via a CBP Form 28 (Request for Information) to the importer.

Additional documentation may be needed. Furthermore, when requested by CBP, the importer shall provide additional documentation above and beyond the certification regarding such issues as RVC calculation. The importer may also provide relevant information from the exporter or producer of the good. CBP states that in many instances, the exporter may be unwilling to provide cost and/or sourcing information to the importer. In this case, CBP states that it will work through the importer and that the importer is expected to arrange for the foreign supplier to provide information directly to CBP.

CBP's Determination of a UCFTA "Originating Goods" Claim

Positive or negative determination on whether the goods qualify as originating. CBP states that if the importer forwards, upon CBP's request, the certification and/or any other records or documentation demonstrating that the goods qualify for UCFTA preferential tariff treatment, CBP will notify the importer of the positive determination via a CBP Form 29 (Notice of Action) stating that the goods qualify as UCFTA originating, and will include the HTS number, description of the good and the relevant rule of origin applied to the good.

A negative determination regarding a certification, issued via a "Proposed" CBP Form 29, may be issued due to a failure to submit the certification or any relevant information. If the importer fails to comply with the "Proposed" CBP Form 29, within 20 days of the date of the notice, a CBP Form 29 "Action Taken" negative determination will be issued to the importer.

In addition, if the importer provides the certification, and CBP determines, based on the information submitted, that the goods do not qualify for preferential treatment as UCFTA originating goods, a negative determination will be sent to the importer in the form of a CBP Form 29.

CBP states that if claims were made for preferential tariff treatment based on a blanket certification against which a negative determination was established, CBP shall deny preferential tariff treatment to all importations of identical merchandise covered by that blanket certificate of origin for all entries that have not reached final liquidation.

Suspension of preferential treatment. Where CBP determines through verification that an importer has certified more than once, falsely or without substantiation, that a good qualifies as UCFTA originating, CBP states that it may suspend preferential tariff treatment to identical goods imported by such person until that person proves otherwise to CBP satisfaction.

Correction of certification. Furthermore, if CBP determines that a certification is illegible, defective or has not been completed in accordance with the requirements, the importer shall be granted no less than five working days to submit a corrected certification. Failure to provide a corrected certification shall result in denial of the claim.

Merchandise Processing Fee

According to CBP, originating goods that qualify for UCFTA preferential treatment are not subject to the Merchandise Processing Fee (MPF). TPL textile merchandise is still subject to the MPF.

Protest Rights

In addition to the post-importation refund claims cited above, importers or other interested parties may file a protest under 19 USC 1514 to contest a negative origin determination within 90 days of the date of liquidation. The protest may enable the importer to receive a refund of duties and/or MPF for eligible goods entered, or withdrawn from warehouse, for consumption.

(See ITT's Online Archives or 01/05/04 news, 04010505, for BP summary of Proclamation on UCFTA; see ITT's Online Archives or 01/07/04 news, 04010710 for BP summary of future ABI programming requirements for UCFTA; see ITT's Online Archives or 01/08/04 news, 04010810 for BP summary of UCFTA TPLs.)

CBP Memorandum (dated 01/29/04) available at http://www.cbp.gov/ImageCache/cgov/content/import/international_5fagreements/chile_5ftrade_5fagreement_2edoc/v1/chile_5ftrade_5fagreement.doc