Abady Law Firm, P.C. – Customs and Import/Export Attorney Blog

Learn the Basics of Customs and International Trade Policy and Procedure

Can I get a refund for state sales tax paid while on my trip to the United States?

How to obtain a refund of sales tax paid while visiting the United States

In general, states within the United States provide an exemption from sales and use tax on tangible personal property purchased in that particular state and thereafter exported to another country.  This is would be beneficial for those who travel to the United States from foreign countries and hand carry their goods; however, only Louisiana and Texas currently offers refund of sales tax in such cases.

Other than hand carry, the process for applying for a sales tax refund may be different, depending on the state you have purchased the goods from.  In certain situations it may make economic sense (i.e. shipping fees and import duties at the country of destination) to make large purchases in the United States and have them shipped by carrier to your foreign address.

For example:  Mr. Doe buys $100,000.00 worth of products in New York and pays 8.875% in sales tax equalling $8,875.00, Shipping those goods to and paying import duties (as opposed to hand carry in luggage) in Hong Kong is only $2,500.00.  As long as Mr. Doe keeps all his receipts and shows proof of export for said products Mr. Doe would get back $6,375.00 from the New York State Tax Department.  Thus, instead of paying $108,875.00 (cost of products including tax) he would only end up paying $102,500.00 for those products.

*It may also make sense if you are traveling with a group of people to consolidate a shipment all together to a foreign destination in order to benefit from a sales tax refund.

To get the sales tax refunded one must keep all shipping documentation as evidence that the goods left the United States. Shipping documentation may include a U.S. Postal Service, UPS, FedEx receipt, or a freight forwarder’s receipt and a copy of the original bill of lading issued by a licensed carrier describing the goods to which a refund will be requested.

Keep in mind that the requirements are comprehensive and there may be a limited period of time to which one may be permitted to request a sales tax refund.  Further, the wait time for the refund can take months.  Thus, it may be beneficial to contact an attorney who has experience in this area.

Contact us today for legal assistance is preparing an application for the return of sales tax paid on exported goods.

Customs Attorney: Liquidated Damages – Amended Guidelines for Untimely Petitions and Mitigation of Claims

Recently, U.S. Customs and Border Protection (“CBP”) amended its guidelines for the cancellation and mitigation of claims for liquidated damages in situations where the Petitioner is late in filing claims for relief.  Petitions are considered “untimely” or “late” if they fall outside of the established regulatory time frames or after the expiration of any lawfully obtained extensions.  19 C.F.R. Part 172.

Under the new guidelines, untimely petitions will be accepted or considered only if the petitioner is able to demonstrate the existence of “extraordinary circumstances that prevented the petitioner from filing a timely petition or timely seeking a lawful extension of time in which to file a petition” (with limited exceptions).   The Fines, Penalties, and Forfeitures Officer will exercise his or her discretion in determining whether the Petitioner meets the “extraordinary circumstances” standard.

As far as mitigation is concerned:

In calculating the mitigated amount on a late petition, CBP (with limited exceptions) will:

1. Determine the base amount (i.e., the amount of mitigation that would have been afforded on a timely petition or the previously available option one amount).

2. Determine the “additional mitigation amount” by multiplying the full assessed amount of the claim by 0.1%  (.001) and then multiply by the number of days the petition is late.

3. The product will be the additional amount which will be added to the base amount to produce the mitigated amount applied to the untimely filed petition.

For example, a $100,000 liquidated damages claim for which a petition is filed 30 days late will be mitigated to the amount provided by the guidelines plus an additional amount calculated by the new formula (30 days late x .001 = .03 x 100,000 = $3,000 added charge.)

The above went into effect January 9, 2013.

As discussed above, untimeliness can result into substantial monetary loss.  Thus, it is best to consult with an attorney regarding the new guideline applications and exceptions.

You may call us at 347-512-9007 for more information on your international trade and customs issues.

Customs Attorney: Confidential Treatment of Shipping Manifests

How can I prevent information about my imports from being available to the public?

As some of you may or may not be aware pursuant to the privacy statute, 19 C.F.R. § 103.31 (d), the public is allowed to collect manifest data (e.g., bills of lading) at every port of entry. The information is limited to vessel manifests (air, rail, and truck manifests will not be available to the general public in any form).

Websites such as panjiva.com and importgenius.com collect and publish names of importers/suppliers/manufacturers from vessel manifest data. This can be troubling for some because entities such as your competitors are able to access information related to the sourcing and/or manufacturing of your products. However, an importer/shipper may make a request for confidentiality. The confidential protection is valid for 2 years, after which time a renewal is needed. Send in renewal requests 60 days prior to the expiration of the 2 year confidentiality period.

If you need assistance in requesting such confidentiality contact a customs attorney who can help.

You may call us at 347-512-9007 for more information on your international trade and customs issues.

Customs Attorney: Customs and Border Protection: Intellectual Property Enforcement

As a Customs attorney I find it surprising that intellectual property holders do not take advantage of Customs and Border Protection’s (“CBP”) ability to protect their intellectual property (“IP”). CBP is authorized to search all imports/exports and exclude, detain, and/or seize products that are counterfeit or otherwise infringing on the intellectual property of the IP holder. The way to gain the assistance of CBP is to utilize their Intellectual Property Rights Recordation System

CBP’s record system is separate and apart from the U.S. Patent and Trademark Office and Copyright office filing. In order to maximize the IP holder’s rights at the border they should record with CBP via the e-Recordation system. CBP has provided some benefits of e-Recording:

  • Making intellectual property rights information available at the ports to help CBP personnel with infringement determinations.
  • Eliminating paper applications and the need for supporting documents.
  • Allowing rights owners to upload images of their protected rights.

Additonally, IP holders can work with Customs in order to help them identify infringers. Businesses and rights owners are encouraged to submit allegations of infringing shipments or conduct to CBP. CBP then uses this information to locate such activity. Further, IP holders can provide CBP with e-guides for detecting infringing goods. Lastly, IP holders can initiate training sessions to actual CBP inspectors at troublesome ports of entry.

To find trademark and copyright records one can access http://iprs.cbp.gov/. I urge IP holders to take advantage of these enforcement opportunities to ensure quality control of their IP rights. One can contact a Customs attorney who can guide an IP holder in maximizing the enforcement of their IP rights with CBP.

You may call us at 347-512-9007 for more information on your international trade and customs issues.

Import Export Attorney: Ghana and Gold: Possible Scams

As an attorney who focuses on import and export laws I have worked with clients who have been approached online by Ghanaians at a dating website or other forum offering a chance to purchase gold. One must take a look at the totality of circumstances in determining whether these are legitimate. More than a majority of these are scams in an effort to con persons into wiring money and never seeing a return. The U.S. Embassy has posted helpful information on this topic here: http://ghana.usembassy.gov/romance_scam.html.

If you have questions or concerns around the validity of potential gold offerings, speaking with an attorney who has handled these types of matters can save you from being scammed.

You may call us at 347-512-9007 for more information on your international trade and customs issues.

Customs Attorney: Commercial Invoice and Footwear

In general, a commercial invoice should provide enough information for a Customs and Border Protection (CBP) Officer to determine if the goods being imported are admissible, and if so, what the correct rate of duty should be applicable based on its Harmonized Tariff Number.

Customs does not provide a specific format for a commercial invoice, however they do provide the elements that should be on an invoice in 19 C.F.R. 141.85.

At a minimum, an invoice should:

1. Describe the item clearly

2. Give the quantity

3. State the value (either price paid, or estimated value based on other considerations.) Give both the value in foreign currency and U.S. dollars

4. Country of Origin (where the item was made)

5. Where it was purchased

6. Name of the business or person selling the merchandise

7. Location of the business or person selling the merchandise

8. Name and address of business or person buying the merchandise, and if different from the importer

9. The U.S. address of the person or business the goods are being shipped to

In addition, Footwear is unique and Customs requires more detail; these additional requirements may be viewed at 19 C.F.R. 141.89.  The additional invoice one must include with all their shipments is the “Interim Footwear Invoice.” A sample of a interim footwear invoice can be found here.

$50,000.00 Wire Transfer Limit from China to the U.S.

Chinese clients are presented with the issue of moving more than $50,000 per year from China to the U.S. due to Chinese banking restrictions. China controls inbound and outbound foreign exchange flows. If a Chinese citizen wants to make an overseas payment they must purchase the funds with renminbi (RMB) i.e. official currency of the People’s Republic of China. Further, when converting the RMB to a foreign currency, the bank is required to review whether the payment is for investment or for a regular payment. If it is for an investment the chances of acceptance are slim.

One has a greater chance of acceptance if done through a corporation. Chinese law provides that a corporation can make investments but they have to gain approvals from the government agencies in China such as National Development and Reform Commission (NDRC), The Ministry of Commerce (MOFCOM) and the State Administration of Foreign Exchange (SAFE). This application process takes time. Factors that are taken into account may include 1) the industry sector and size of the investment; 2) location of the corporation; 3) tax status; 4) the feasibility analysis of the investment (which may include scrunity as to the background of the corporate members).

Resource Information

For more information about this blog post, please contact Abady Law Firm, P.C. and speak with our attorney at (800) 549-5099. Also visit www.customsesq.com to chat with a lawyer — who has insight into the Chinese wire transfer limits — about your company’s legal situation and to schedule a consultation.  To chat with us, click the bottom right corner tab of our homepage.

Liquidated Damages by Customs and Border Protection

Liquidated Damages are predetermined civil penalties assessed against importers who have breached the terms of Customs bond.  These liquidated damages claims arise when an importer  fails to adhere to the Customs regulations and/or requests made by Customs on behalf of other government agencies (e.g. FDA). Specifically, a majority of the claims for liquidated damages stem from issues related to failure to redeliver goods, or improper  classification, valuation, or marking.

Petitions for relief from liquidated damages must be filed within sixty (60) days from the date of mailing to the bond principal, the notice of claim for liquidated damages, or penalty secured by a bond.  The degree at which Customs will grant mitigation is dependent on Customs mitigation guidelines and the facts and circumstances of the case.

As always when faced with a liquidated damages claim it is best to consult with a customs attorney about your options when preparing a petition to file with Customs.

Resource Information

For more information about this blog post, please contact Abady Law Firm, P.C. and speak with our customs attorney at (800) 549-5099. Also visit www.customsesq.com to chat with an import export attorney — who has insight into liquidated damages claims — about your company’s import or export situation and to schedule a consultation.  To chat with us, click the bottom right corner tab of our homepage.

Don’t forget to LIKE US on Facebook for firm news, import/export news and legal updates.  

Customs Attorney: Customs Protest

A protest (Customs Form 19) is a means by which an importer can contest the way in which an entry was finalized or liquidated. Generally, any issue regarding the value, classification, or admissibility of an entry may be raised after liquidation. 19 U.S.C. § 1514; 19 C.F.R. § 174.13.

A protest is required to be filed within 180 days (no extensions permitted) after liquidation or reliquidation of the entry (19 U.S.C. § 1514(c)(3)(A); 19 C.F.R. § 174.12(e)) or within 180 days if liquidation is inapplicable (19 U.S.C. § 1514(c)(3)(B); 19 C.F.R. § 174.12(e)(2)).

The protest form asks for basic information regarding the entry, however it is in the importers best interest to supplement the protest with a detailed analysis of why Customs should grant the claim. Generally, the protest is reviewed by local Customs, however there is an option to request that the protest be reviewed by Customs Headquarters in Washington.

If the protest is approved the entry will be reliquidated and refund due (if applicable) to those entries that were protested. 19 U.S.C. § 1515(a); 19 C.F.R. § 174.29.

For protests involving the payment of duties, if the duties have been paid and the protest is approved then Customs pays the refund amount plus interest that has accrued from the payment date. If the duty has not been paid and the protest is rejected the importer pays the duty plus interest accrued from the date that payment was due. 19 C.F.R. § 24.36.

You may call us at 347-512-9007 for legal assistance in preparing a proper protest.

Customs Seizure: Petition for Remission or Mitigation of Forfeiture

Petitions for Remission or Mitigation of Forfeiture (“petition for relief”) are written presentations (sometimes supplemented with an oral presentation) whereby an alleged violator of a customs law or regulation responds to the government’s issuance of a penalty, claim for liquidated damages, or notice of seizure. A petition is the means for the alleged violator to convince Customs that there is a reason to remit or mitigate the penalty, liquidated damages, or seizure. Petitions are usually due 30 days from the date stamp on the notice (not the date in which it is mailed or received). One may ask for an extension if need be. Customs regulations (19 C.F.R. § 171.1) provide the following information when preparing a petition:

The petition for remission or mitigation need not be in any particular form. Customs can require that the petition and any documents submitted in support of the petition be in English or be accompanied by an English translation. The petition must set forth the following:

(1) A description of the property involved (if a seizure);

(2) The date and place of the violation or seizure;

(3) The facts and circumstances relied upon by the petitioner to justify remission or mitigation; and

(4) If a seizure case, proof of a petitionable interest in the seized property.

The alleged violator begins at a disadvantage – it is the accused who has the burden of proving its innocence. Thus, it is best to consult with an attorney about your options immediately, time is of the essence!

Resource Information

For more information about this blog post, please contact Abady Law Firm, P.C. and speak with our customs attorney at (800) 549-5099. Also visit www.customsesq.com to chat with a customs lawyer — who has insight into the administrative petition process — about your company’s import situation and to schedule a consultation.  To chat with us, click the bottom right corner tab of our homepage.

Don’t forget to LIKE US on Facebook for firm news, import/export news and legal updates.