FAQ

Frequently Asked Questions

 

 

Antidumping and Countervailing Duties (AD/CVD) FAQs

Dumping occurs when a foreign manufacturer, producer, or exporter sells goods in the U.S. at less than fair-market value, causing injury to the U.S. industry. Duties are calculated to bridge the gap back to fair market value.

Antidumping occurs when a foreign producer, exporter, or manufacturer sells a product in the United States at a price that is below “normal value.” Normal value may be the price at which the foreign producer sells the merchandise in its own domestic market (or a third-country market) based on its production costs plus an amount for profit. Antidumping is additional duties assessed on goods to counteract dumping.

Countervailing occurs when a foreign government provides assistance and subsidies, such as tax breaks to manufacturers that export goods to the U.S. This enables the manufacturers to sell the goods cheaper than domestic manufacturers. The assessment of Countervailing duties offsets or “countervails” these subsidies. Duties are calculated to duplicate the value of the subsidy.

You need to review the scope of AD/CVD orders to determine whether the merchandise falls under the scope of an order. The scope of AD/CVD orders can be found in several places:

The key difference between antidumping and countervailing is that antidumping provides relief from unfair trade pricing practices. Countervailing provides relief from unfair trade subsidies by foreign government.

It is the Importer of Record’s responsibility to be aware of any antidumping and/or countervailing duties that may apply to its goods, and to pay the applicable AD/CV duties at the time of entry.

Failure to correctly declare AD/CVD and pay required duties at time of entry may expose the importer to serious penalties and other consequences, including a referral to U.S. Immigration and Customs Enforcement for civil and/or criminal investigation.

Liability for AD/CVD is dictated by the AD/CV case scope definition, NOT by HTS number. The U.S. Government provides a list of likely HTS numbers for each AD/CVD case for convenience only, but not all items covered by an HTS number are necessarily covered under the Scope definition. An importer must read the scope of any AD/CVD case that could apply to its goods in order to determine applicability.

If your product or products have been determined to be subject to AD/CVD, a non-reimbursement statement must be completed. This is a statement informing CBP whether or not you have been reimbursed, or if you have entered into an agreement to be reimbursed, for the AD/CVD duties that you are paying on imported products. If you fail to provide this statement prior to liquidation, CBP will assume that you have been reimbursed and will double the duties. Blanket Statement of Non-Reimbursement Form

If your product is flagged as subject to AD/CVD duties but is not within the scope of the AD/CVD order, you must fill out an ADD/CVD Statement of Non-Applicability to indicate that you have researched your product and determined that it does not fall within the scope of the AD/CVD order. (Find our forms page here)

9801 FAQs

A 9801 HTS number can be used if your goods are of U.S. origin, you have the documents to support the origin claim, and you would like to import the goods into the United States duty free.
Before using a 9801 number, ask yourself if the use of 9801 is necessary in the current situation. Calculate the amount of duty and MPF that would be owed on the product if you did not use the 9801 tariff number. Perhaps the item is already duty free under the regular tariff number and the MPF is minimal. CBP is currently heavily auditing the use of 9801 claims and it may not be worth the risk of an audit if the benefit in using 9801 is minimal.
U.S. Goods Returned
  • To receive the benefit of this provision, the importer must provide documentation to satisfy the tariff provision and conform to 19 CFR 10.1:
  1. Foreign Shipper Declaration – Single Shipment Fillable Form
  2. Statement from U.S. – Single Shipment Fillable Form
  3. Manufacturer’s Affidavit – Single shipment fillable form | Annual Blanket Fillable Form

Foreign Goods Returned

  • To receive the benefit of this provision, the importer must provide documentation to satisfy the tariff provision and conform to CSMS Message 17-000046:
  1. Foreign Shipper Declaration – Single Shipment Fillable Form
  2. Proof of Exportation, which may be in the form of ONE of the following:
    1. Foreign Customs Entry Summary (Ex: Cdn B3 Entry) -OR-
    2. U.S. Export Invoice or Bill of Lading/Airway Bill -OR-
    3. Electronic Export Information (EEI) or the Automated Export System (AES) filing exemption (Electronic System to file exports out of the U.S.)
  • Goods must be returned to the United States within three years of export from the United States.
  • Any drawback previously claimed is required to be repaid upon reimportation. There is no time limit on when U.S. goods must be returned.
You can provide a waiver, and we have one available on our forms page. However, this does not exclude you from the requirement of having the appropriate documentation to back up your 9801 claim. CBP heavily audits the use of 9801 and it is very likely you will have to produce the documents anyway. The use of a waiver is not recommended.

Bonds

Single Transaction Bonds (STBs) cover a single import transaction at one port of entry. This option is ideal for companies that typically have less than four imports into the U.S. per year, especially if the goods have low value and no Partner Government Agency (PGA) reporting (i.e., FDA, EPA, APHIS Core, etc.). An STB for merchandise that requires PGA reporting is required to be executed at three times the total entered value of the merchandise. For each shipment, the purchase of a new STB is required.

Continuous bonds cover all of an importer’s shipments, at all U.S. ports of entry, for a full year. For companies that have five or more shipments per year or have high value shipments, a continuous bond is highly recommended. A continuous bond may also be recommended for importers with products that require reporting to Partner Government Agencies (PGAs).

Duty Drawback

Drawback is 99% recovery of duty paid upon an imported product, subsequently exported out of the country in either unused or manufactured state.
Drawback can be filed against goods imported up to 5 years prior to the date of claim. Date of exportation must be after the date of import.
If you are exporting or destroying goods that were previously imported and paid duty, you may be eligible for drawback. There are many restrictions and complexities that would need to be researched to determine eligibility. For assistance in determining eligibility, e-mail drawback@anderinger.com.
It depends on the amount of recovery and the available resources in order to comply with the requirements and supporting documents/information. An annual recovery of at least $100,000 in refunds is a good start for a drawback program, but if there are few transactions and larger valued/dutiable items, a smaller program may be feasible.
The type of applications will depend upon the type of drawback program that will be pursued. There may be rulings along with special privilege applications required. It is recommended that a drawback specialist assist with the development for approval of a drawback program with CBP due to the complexity. For assistance in applying for drawback, e-mail drawback@anderinger.com.
The drawback program does not typically open a company up to import audits, however, there are specific drawback audits that could be performed by CBP. Going through the initial application process helps to vet your supporting records and make sure your company has the information to support a compliant drawback program.
Customs will issue a 99% refund, and there would be charges from the Customs Broker assisting with the program. Charges may include an application fee to get the project approved with Customs, commission rate, audit assistance fees and bond fees.
Customs keeps 1% (99% refund). There may also be processing fees from the broker.
MPF and HMF are recoverable through drawback along with duty and Section 301 duties (Section 232 duties are not recoverable through drawback).
Yes, additional duties paid on the value of assists are allowed for recovery through drawback.
Unfortunately, ADD and CVD duties are not recoverable through drawback.

Some of the most important documentation involved in drawback are the proof of exportation documentation. Since drawback is an export incentive program is it imperative that you have the ability to prove time and date of export. The import information is also required for the refund calculations.

Depending upon the type of drawback program, the documentation/information can vary. Keep in mind all business records relating to each transaction upon which drawback will be requested must be retained for at least 3 years following the liquidation of the drawback claim. The record retention period can get lengthy and go beyond a normal business retention period.

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