J.G. Eberlein & Co., Inc.
Drawback Specialists - Licensed Customhouse Brokers
Since 1924

Types of Drawback

MANUFACTURER’S DRAWBACK

DIRECT IDENTIFICATION METHOD  

A claimant may file a claim for drawback on imported merchandise if it is used in the manufacture of an exported article. The claimant’s records must clearly establish the fact that the exported article was produced from a specific lot of imported merchandise.

 

APPLICATIONS
In order to file claims for drawback the following applications must be filed with U.S. Customs and Border Protection:

 

A. Manufacturer’s Drawback Ruling
    1. Filed in the port where claims are filed
    2. Three to six months for approval from U.S. Customs
    3. Claims may be filed pending approval no payment until approved

 

B. Accelerated Payment Privilege
    1. Must be filed after drawback ruling is approved. One to three months for approval.
    2. Allows for the payment of drawback refund within three to four weeks of filing.
    3. Drawback bond must be posted.
    4. Claims may be filed pending approval, no payment until approved.

 

DOCUMENTATION
The documents needed to prepare the applications and the actual claims include but are not limited to:  

A. Import purchase order
B. Import purchase invoice
C. Receiving record
D. Entry summary*
E. Production record**
F. Export sales invoice
G. Export bill of lading***

 

* The drawback claimant need not have paid the import duties directly to U.S. Customs and Border Protection. Import duties are often buried in the purchase price on imported merchandise obtained from an American distributor. U.S. Customs and Border Protection assumes that the drawback value of the merchandise passes on with the sale of the imported merchandise.

 

** The production record must clearly show which lot of imported merchandise was used in production. This production record should also be referenced on the export invoice along with the quantity exported.

 

*** The Customs Regulations state that the exporter is entitled to the drawback refund unless the right is waived. Many companies sell drawback eligible merchandise to domestic companies who subsequently export the merchandise. If the proper waiver is obtained from the exporter claims can also be filed against those exports.

 

TIME FRAMES
A. A claim for drawback must filed within three years from the date of export.
B. The subject export must have been produced within five years from the date of import.


SUBSTITUTION METHOD 

A claimant may file a claim for drawback on imported merchandise even if it is not physically incorporated into the exported article. The imported merchandise need only be consumed in production by the manufacturer. Other imported or domestic merchandise of the “Same Kind and Quality” may be used in the production of the exported article. The claimant’s records must clearly establish the fact that the exported merchandise was produced from merchandise of the “Same Kind and Quality”as the imported merchandise.

 

One plant may import while a second plant exports provided both plants are divisions of the same company.

 

APPLICATIONS
In order to file claims for drawback the following applications must be filed with U.S. Customs:

 

A. Manufacturer’s Drawback Ruling
   1. Filed with U.S. Customs and Border Protection in Washington, DC.
   2. Six to nine months for approval from U.S. Customs and Border Protection.
   3. Claims may be filed pending approval, no payment until approved.

 

B. Accelerated Payment Privilege
   1. Must be filed after drawback ruling is approved. One to three months for approval.
   2. Allows for payment of drawback refund within three to four weeks of filing date.
   3. Drawback bond must be posted.
   4. Claims may be filed pending approval.

 

DOCUMENTATION
The documents needed to prepare the applications and the actual claims include but are not limited to:

A. Import purchase order
B. Import purchase invoice
C. Receiving record
D. Entry summary*
E. Date exported merchandise is produced
F. Bill of material
G. Export sales invoice
H. Export bill of lading**

 

* The drawback claimant need not have paid the import duties directly to U.S. Customs and Border Protection. Import duties are often buried in the purchase price on imported merchandise obtained from an American distributor. U.S. Customs and Border Protection assumes that the drawback value of the merchandise passes on with the sale of the imported merchandise.

 

** The Customs Regulations state that the exporter is entitled to the drawback refund unless the right is waived. Many companies sell drawback eligible merchandise to domestic companies who subsequently export the merchandise. If the proper waiver is obtained from the exporter claims can also be filed against those exports.

TIME FRAMES
A. A claim for drawback must filed within three years from the date of export.
B. The subject export must have been produced within five years from the date of import.
C. The exported article must be produced within three years from the date the merchandise was physically received at the plant.  

 


UNUSED MERCHANDISE DRAWBACK

DIRECT IDENTIFICATION METHOD   

A claimant may file a claim for drawback on imported merchandise that is subsequently exported in an unused condition. Prior to exportation, Customs must be advised of an export shipment in order to afford them the opportunity to examine the export shipment. The claimant’s records must clearly establish the fact that the exported merchandise was the imported merchandise.

APPLICATIONS

In order to file claims for drawback the following applications must be filed with U.S. Customs and Border Protection:

A. Waiver of Prior Notice
    1. Allows the filing of drawback claims on future exports without U.S. Customs and Border         Protection having to inspect the exported merchandise.
    2. One to three months for approval from U.S. Customs and Border Protection.
    3. Claims may be filed pending approval, no payment until approved.

B. One Time Waiver of Prior Notice
    1. Allows the retroactive filing of drawback claims for the last three years not with-standing the fact that prior notice was not given to U.S. Customs and Border Protection.
    2. One to three months for approval from U.S. Customs and Border Protection.
    3. Claims may be filed pending approval, no payment until approve.

C. Accelerated Payment Privilege
    1. Allows for payment of drawback claim within three to four weeks of filing.
    2. Claims may be filed pending approval, no payment until approved.
    3. Drawback bond must be posted.

DOCUMENTATION
The documents needed to prepare the applications and the actual claims include but are not limited to:

A. Import purchase order
B. Import purchase invoice
C. Receiving record
D. Entry summary*
E. Export sales invoice
F. Export bill of lading**

* The drawback claimant need not have paid the import duties directly to U.S. Customs. Import duties are often buried in the purchase price on imported merchandise obtained from an American distributor. U.S. Customs assumes that the drawback value of the merchandise passes on with the sale of the imported merchandise.

** The Customs Regulations state that the exporter is entitled to the drawback refund unless he waives that right. Many companies sell drawback eligible merchandise to domestic companies who subsequently export the merchandise. If the proper waiver is obtained from the exporter claims may also be filed against those exports.

TIME FRAMES
A. A claim for drawback must filed within three years from the date of export.
B. The subject merchandise must be exported within three years from the date of import.  

SUBSTITUTION METHOD 

A claimant may file a claim for drawback on imported merchandise even though the merchandise exported is not the actual imported merchandise. The exported merchandise must be”commercially interchangeable” with the imported merchandise that is used as the basis of claim. Prior to exportation, Customs must be advised of an export shipment in order to afford them the opportunity to examine the export shipment. The claimant’s records must clearly establish the fact that the exported merchandise is commercially interchangeable with the imported merchandise.  

APPLICATIONS
In order to file claims for drawback the following applications must be filed with U.S. Customs and Border Protection:  

A. Waiver of Prior Notice
   1. Allows the filing of drawback claims on future exports without U.S. Customs and Border            Protection having to inspect the exported merchandise.                                
   2. One to three months for approval from U.S. Customs and Border Protection.
   3. Claims may be filed pending approval, no payment until approved.  

B. One Time Waiver of Prior Notice
    1. Allows the retroactive filing of drawback claims for the last three years not withstanding the fact that prior notice was not given to U.S. Customs and Border Protection.
    2. One to three months for approval from U.S. Customs and Border Protection.
    3. Claims may be filed pending approval, no payment until approved.  

C. Accelerated Payment Privilege
    1. Allows for payment of drawback claim within three to four weeks of filing.
    2. Claims may be filed pending approval, no payment until approved.
    3. Drawback bond must be posted.  

D. Commercial Interchangeability Determination
    1.  An application must be filed with U.S. Customs and Border Protection to determine whether or not the exported merchandise is commercially interchangeable with the imported merchandise used as the basis of claim. 

DOCUMENTATION
The documents needed to prepare the applications and the actual claims include but are not limited to:  

A. Import purchase order
B. Import purchase invoice
C. Receiving record
D. Entry summary*
E. Export sales invoice
F. Export bill of lading**  

* The drawback claimant need not have paid the import duties directly to U.S. Customs. Import duties are often buried in the purchase price on imported merchandise obtained from an American distributor. U.S. Customs assumes that the drawback value of the merchandise passes on with the sale of the imported merchandise.  

** The Customs Regulations state that the exporter is entitled to the drawback refund unless the right is waived. Many companies sell drawback eligible merchandise to domestic companies who subsequently export the merchandise. If the proper waiver is obtained from the exporter claims may also be filed against those exports. 

TIME FRAMES
A. A claim for drawback must be filed within three years from the date of export.
B. The subject merchandise must be exported within three years from the date of import.

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