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On April 20, 2020, the Secretary of the Treasury and U.S. Customs and Border Protection (CBP) announced via the CBP Customs Service Messaging System (CSMS #4243171) that they would be postponing the deadline for payment for the deposit of certain estimated duties, taxes, and fees for importers who have experienced a “significant financial hardship” due to the ongoing coronavirus disease (COVID-19) for up to 90 calendar days. This temporary postponement applies to formal entries of merchandise entered, or withdrawn from warehouse, for consumption (including entries for consumption from a Foreign Trade Zone) in March 2020 or April 2020.  CBP released an additional announcement (CSMS # 4243171) that formally outlined payment instructions for entries that qualify for this postponement period.  Customs has also established a COVID-19 website page with FAQ’s concerning the 90-day postponement and procedures.

A “significant financial hardship” for purposes of the 90-day postponement requires that the importer’s operations be fully or partially suspended during March 2020 or April 2020 due to orders from a competent governmental authority limiting commerce, travel, or group meetings due to COVID-19, and as a result of such suspension, the gross receipts of such importer for March 13-31, 2020 or April 2020 are less than 60 percent of the gross receipts for the comparable period in 2019.

Importers do not need to file documentation with CBP to be eligible for this relief but must maintain appropriate documentation as part of their books and records. Also, CBP has been clear that it may conduct a review of such documentation at a future date.

According to CBP, the temporary postponement does not apply to any entries or withdrawals from the warehouse for consumption, where the entry summary includes merchandise subject to one or more of the following:

  • Antidumping duties,
  • Countervailing duties,
  • Duties assessed pursuant to Section 232 of the Trade Expansion Act of 1962,
  • Duties assessed pursuant to Section 201 of the Trade Act of 1974, and
  • Duties assessed pursuant to Section 301 of the Trade Act of 1974.

As an example, if an entry contains goods subject to antidumping duties and other goods not subject to antidumping duties, then the entire entry will be precluded from the 90-day postponement.  However, CBP has also indicated that they will be allowing importers to utilize procedures enabling them to split goods in a consolidated shipment and enter the various goods separately.

Estimated duties, taxes, and fees paid on single pay basis or Daily Statement may be postponed up to 90 days from the payment due date. Listed below are examples of the type of time frame companies will experience during this postponement:

Example:

Original Due Date 90-Day Postponement
April 30, 2020 July 29, 2020

 

Estimated Internal Revenue Tax paid via the deferred tax schedule may be postponed up to three months from the payment due date.

Example:

Original Due Date 3 Month Postponement
April 29, 2020 July 29, 2020
May 14, 2020 August 14, 2020

Estimated duties and fees paid via Periodic Monthly Statement (PMS) may be postponed up to three months, as defined by the 15th working day of the third month.

Example:

Original Due Date 3 Month Postponement
April 21, 2020 July 22, 2020
May 21, 2020 August 21, 2020

 

Husch Blackwell encourages those who may have entries that that qualify for this 90-day postponement to reach out to our International Trade and Supply Chain team.

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Photo of Robert Stang Robert Stang

Bob focuses his practice on customs and international trade law. He brings 30 years of experience to a wide range of issues that affect inbound and outbound goods, including tariff classification, valuation, country of origin marking matters, free trade agreements, and special trade…

Bob focuses his practice on customs and international trade law. He brings 30 years of experience to a wide range of issues that affect inbound and outbound goods, including tariff classification, valuation, country of origin marking matters, free trade agreements, and special trade programs. He also has extensive customs compliance experience and regularly assists importers facing U.S. Customs and Border Protection (CBP) audits, penalties, seizures, redelivery notices and other agency enforcement activities. Bob works with importers and exporters proactively to achieve cost savings and structure programs that meet CBP “reasonable care” requirements. He also handles supply chain security issues, including Customs-Trade Partnership Against Terrorism (C-TPAT) enrollment, verification and annual reviews.

Photo of Turner Kim Turner Kim

A trade analyst, Turner conducts industry research and analyzes trade data to assist attorneys with client proceedings at the U.S. International Trade Commission, U.S. Department of Commerce and U.S. Court of International Trade. He also actively monitors U.S. government and global trade developments…

A trade analyst, Turner conducts industry research and analyzes trade data to assist attorneys with client proceedings at the U.S. International Trade Commission, U.S. Department of Commerce and U.S. Court of International Trade. He also actively monitors U.S. government and global trade developments for issues relating to client’s most critical trade matters.