Protest Customs Decisions; Protest Filing

What is a protest against a Customs Decisions?

Protesting customs decisionsis a longstanding administrative process before U.S. Customs & Border Protection that is the first step to challenging certain unfavorable decisions. A protest is different from a petition for relief, which is an administrative request for relief from a forfeiture, a penalty, or a claim for liquidated damages.

What decisions of Customs can be protested?

A protest can be made of decisions by customs concerning the classification of merchandise (i.e., how it is categorized in the HTSUS (tariff schedule) and taxed), appraised value, liquidation or reliquidation (final treatment), exclusion of merchandise (and deemed exclusions for failure to seizure after detention), a refusal to pay a claim for drawback, and the refusal to reliquidate a claim.

These grounds for seizure appear in 19 USC 1514, and are also set out in more detailed in Part 174 of Title 19 of the Code of Federal Regulations.

How is a protest filed with CBP?

A protest is filed with CBP either on paper, using CBP Form 19, or they can be filed electronically through the Customs ACE portal through a protest filer account. The ACE portal account makes the protest process far less painless than the old paper filing process.

What should a protest contain?

A protest should contain some obvious information; names and address of the person protesting, the importer and their importer number; the number and date of the entry (i.e., the number assigned to the shipment by your broker for tracking with CBP); the date of liquidation of the entry, or the date of the other decision being protested, and a description of the merchandise involved, and a host of other specific sets of information.

But most importantly, besides these obvious requirements that help CBP identify what is being protested, a protest must contain “nature of, and justification for the objection set forth distinctly and specifically . . . ” 19 CFR 174.13(6). In other words, you’ve got to tell Customs why you’re right, and why they’re wrong.

In many cases, this is the work of an experienced attorney; along with the protest is filed a protest memorandum, which sets forth in a clear manner the legal arguments in support of the desired result; reference is usually made to prior administrative rulings, past decisions of the Customs Court or the Court of International Trade, Treasury Decisions, the Explanatory Notes to Harmonized Tariff System, legislative history, prior treatment, and the various Customs laws and the general, section and chapter notes of the Harmonized Tariff System of the United States, where applicable.

What is an example of a protestable decision?

An example of a protestable decision as follows:

Company is importing $10,000 worth of fabric from China, and upon importation they are being classified by the importer as blankets and taxed a rate of 8.5% of their value. Importers owe CBP $850 based on this classification.

But,  Customs believes that the fabric is not actually going to be used as blankets by the importer because the dimensions are too large, and so re-classifies the merchandise as fabric and taxes it at a duty rate of 17.5% of its value. CBP says the importer owes CBP $1,750 instead of $850.

Once the entry is liquidated and duties are paid, the importers can file a protest against the classification and liquidation decision made by Customs, and argue that these goods should be treated as blankets and taxed at the 8.5% rate, not the 17.5% rate.

If the protest is granted, the protester will get a refund. If the protest is denied, the protester (actually called a “protestant”) can file a summons in the Court of International Trade, and ask a judge to review the case and determine the proper classification.

What should I do if I want to file a protest?

If you want to file a protest, get some legal advice. It will be good to talk to your Customs Broker, but it’s also important to realize that not all Customs Brokers are comfortable filing protests, and many do not understand what can and cannot be done with a protest. The more novel the issue that you seek to protest, the greater your need for an experienced attorney to help you weight the merits of the issue you wish to protest is.

If you are interested in getting advice about protest a decision of U.S. Customs & Border Protection, contact Great Lakes Customs Law.