CBP Can't Extend Protest Deadlines for Section 301 Exclusions, but Reconciliation Path 'Interesting,' Official Says

CBP does not have the authority to extend deadlines for filing protests so that importers can claim refunds of Section 301 tariffs on goods granted exclusions well after liquidation, though a path to refunds may be possible via the reconciliation process, Ana Hinojosa, executive director of CBP’s trade remedy and law enforcement division, said during the Commercial Customs Operations Advisory Committee's July 15 meeting.

The COAC’s Intelligent Enforcement Subcommittee AD/CVD Working Group had focused on tardy exclusions at the meeting. It announced three recommendations for CBP, including that the agency evaluate whether under the executive order on regulatory relief there is a way to grant regulatory relief to businesses during the COVID-19 pandemic so that importers can claim refunds after liquidation and the 180-day protest deadline.

“Because of the overwhelming number of Exclusion Orders that were received, some took close to two years to get approved,” the COAC said in a background paper released ahead of the meeting. “As a result, importers are losing millions of dollars in duty refunds because the Exclusion Orders are issued so late well beyond the opportunity to extend a liquidation of an entry (one year) or file a protest (180 days from liquidation).” The issue has been apparent to importers since at least March (see 2004020029).

While the importers that requested the non-company-specific exclusions may have told CBP to extend liquidation, importers unaware of the exclusion request may not have done so, COAC member Lisa Gelsomino said during the meeting. Those refunds are especially important to importers starved for liquidity during the COVID-19 pandemic.

The EO cited in the recommendation allows only for regulatory or administrative action by agencies, but the protest deadline is defined by law, and it’s not within CBP’s authority to change it, Hinojosa said in response to the recommendation. CBP has issued and reissued guidance to importers directing them to request extension of liquidation to protect their access to refunds, she said (see 2005040045).

On the other hand, a recommendation that CBP consider using its reconciliation program to allow importers to flag entries and maintain their eligibility for refunds, similar to what the agency does for the Generalized System of Preferences benefits program, is “interesting,” Hinojosa said. It’s “something we want to have more conversations about and see what the art of the possible is in that area,” she said.