Importer's Miscommunication With Broker Doesn't Excuse Late GSP Refund Request, CBP Says

An importer’s late Generalized System of Preferences refund request should be denied, even though it was caused by a misunderstanding with its customs broker, CBP said in a recent ruling. Industrial Chemicals argued the late filing for a refund for duties it paid during the recent lapse in the GSP program was a protestable “mistake of fact or other inadvertence” and should be excused, CBP said. In ruling HQ H286298, issued Oct. 13, CBP held that there was no mistake on the agency’s part when it enforced the statutory 180-day deadline for filing retroactive GSP claims.

Industrial Chemicals had filed the underlying entries earlier in 2015, toward the end of the two-year period when GSP had expired before it was renewed by the Trade Preferences Extension Act in June of that year (see 1506290045). Under that law, importers had 180 days to file a request for a refund of duties paid on entries that would have been eligible for GSP but for the lapse. Industrial Chemicals’ broker emailed the importer to relay the news, which Industrial Chemicals took to mean the broker would be filing refund requests on its behalf.

But three months later, Industrial Chemicals requested a list of entries eligible for a refund. The broker said it took that to mean the importer would be submitting its own requests. The error wasn’t discovered until it was too late, when Industrial Chemicals told the broker it had not yet received refunds, following the expiration of the 180-day period. After it realized Industrial Chemicals did not submit the refund requests on its own behalf, the broker filed the requests on Feb. 2, 2016, over a month past the deadline.

After its refund requests were denied, Industrial Products protested, arguing that the issue fell under a provision for protests to remedy a “clerical error, mistake of fact, or other inadvertence.” But according to CBP, that applies only to errors at entry, liquidation or reliquidation. No error occurred at entry, and CBP’s liquidation of the entries was not mistaken because it was “in accordance with its own guidance implementing a statutorily-mandated 180-day deadline for filing retroactive GSP claims,” the ruling said.

Importers may also ask CBP to “equitably toll” a deadline, in this case allowing Industrial Chemicals to file its GSP refund request late, when the importer demonstrates it has “been pursuing its rights diligently” and “that some extraordinary circumstance stood” in its way, CBP said. But “Industrial Chemicals’ own miscommunications with its broker is ‘garden variety excusable neglect’ rather than an ‘extraordinary circumstance’ that justifies the equitable tolling of the GSP refund request deadline,” CBP said.