CSMS Message: 00-000893

TO: ALL ABI BROKERS.

FROM: PAMELA MCGUYER

SUBJECT: DRA-CALCULATING MPF FOR DRAWBACK

DATE: 08/09/2000

PUBLIC INSTRUCTIONS FOR
CALCULATING MERCHANDISE PROCESSING FEES FOR DRAWBACK UNDER 19
U.S.C. 1313(J)

BACKGROUND/PURPOSE

AS A RESULT OF THE TEXPORT DECISION, CUSTOMS HAS BEEN DIRECTED
TO REFUND THE MPF IF CLAIMED BY THE FILER ON DRAWBACK CLAIMS
UNDER 19 U.S.C. 1313(J)(1) {ENTRY TYPE 42} AND 19 U.S.C.
1313(J)(2) {ENTRY TYPE 45}. IT IS ANTICIPATED THAT IT WILL TAKE
AT LEAST ONE FULL YEAR FOR CUSTOMS TO MAKE CHANGES TO THE
CURRENT ACS DRAWBACK PROGRAM NECESSARY TO TRACK AND REFUND FEES
CLAIMED AND ACCURATELY DECREMENT ASSOCIATED IMPORT ENTRIES.

DEFINITION

THE COURT, IN TEXPORT OIL CO. V. U.S., 185 FD.3D. 291 (FED CIR
1999) FOUND THE FEE IMPOSED BY 19 U.S.C. 58C(A)(9) TO BE A FEE
IMPOSED BY REASON OF IMPORTATION AND ELIGIBLE TO BE CLAIMED AS
DRAWBACK UNDER 19 U.S.C. 1313(J). THE MPF SUBJECT TO DRAWBACK
IS BASED ON A RELATIVE VALUE FORMULA.

INTERIM PROCEDURES

ALL DRAWBACK CLAIMS REQUESTING A REFUND OF THE MPF MUST BE
CLEARLY IDENTIFIED BY MARKING OR ANNOTATING THE DOCUMENT "MPF
REFUND REQUESTED".

THE CLAIM MUST CONTAIN A SEPARATE CALCULATION WORKSHEET FOR THE
FEES. THIS CALCULATION SHEET MUST BE FOR MPF REFUND ONLY AND
REMAIN SEPARATE FROM THE CALCULATION SHEET FOR OTHER DUTIES AND
TAXES FOR WHICH DRAWBACK REFUNDS ARE REQUESTED.

THE VALUE OF EACH UNIT OF ENTERED MERCHANDISE SUBJECT TO THE FEE
MUST BE CALCULATED RELATIVE TO THE TOTAL ENTERED VALUE OF THE
MERCHANDISE SUBJECT TO THE FEE. WHILE DUTY-FREE MERCHANDISE
THAT IS SUBJECT TO THE FEE IS TO BE INCLUDED IN THE RELATIVE
VALUE CALCULATION, MERCHANDISE THAT IS EXEMPT FROM THE FEE MUST
NOT BE INCLUDED.

THE TOTAL VALUE OF EACH INVOICE LINE ITEM OF MERCHANDISE SUBJECT
TO THE FEE IS CALCULATED TO SIX DECIMAL PLACES. THE LINE ITEM
VALUE AS A PERCENTAGE OF TOTAL VALUE FORMS THE RELATIVE VALUE
RATIO. THE RELATIVE VALUE RATIO IS MULTIPLIED BY THE AMOUNT OF
MPF PAID.

THE AMOUNT APPORTIONED TO EACH LINE ITEM IS MULTIPLIED BY 99
PERCENT TO CALCULATE THE AMOUNT RELATIVE TO THE LINE ITEM THAT
WOULD BE ELIGIBLE FOR DRAWBACK. THE AMOUNT APPLICABLE TO THE
LINE ITEM IS DIVIDED BY THE NUMBER OF UNITS COVERED BY THE LINE
ITEM TO CALCULATE THE AMOUNT OF DRAWBACK ELIGIBLE PER UNIT. THE
CLAIMED AMOUNT IS TO BE ROUNDED TO THE NEAREST TWO DECIMAL
PLACES.

THE FOLLOWING IS AN EXAMPLE ILLUSTRATING THE CALCULATION
PROCEDURE:

LINE ITEM NUMBER OF INDIVIDUAL TOTAL WEIGHTED WEIGHTED 99% OF
NUMBER UNITS VALUE VALUE RATIO RATIO/MPF MPF PER
PER LINE LINE

ITEM 1 5,000 WIDGETS $10 EACH $50,000 .147059 $71.323615 $70.61
ITEM 2 6,000 GISMOS $15 EACH $90,000 .264706 $128.382410 $127.10
ITEM 3 10,000 DOODADS $20 EACH $200,000 .588235 $285.293975 $282.44

GRAND TOTAL $340,000 1.000000 $485.000000 $480.15

IF THE TOTAL FEE PAID WAS $485, THE AMOUNT ATTRIBUTABLE TO EACH
LINE ITEM IS CALCULATED BY MULTIPLYING $485 BY THE APPLICABLE
RATIO. FOR LINE ITEM 1, THE AMOUNT OF THE $485 IS $71.323615
(.147059 X $485 = $71.323615). THE AMOUNT ATTRIBUTABLE TO LINE
ITEM 2 IS $128.382410 (.264706 X $485 = $128.382410). THE
AMOUNT ATTRIBUTABLE TO LINE ITEM 3 IS $285.293975 (.588235 X
$485 = 285.293975).

THE PER UNIT DRAWBACK FOR EACH LINE ITEM IS CALCULATED BY
DIVIDING THE TOTAL AMOUNT OF DRAWBACK ELIGIBLE FOR THE LINE ITEM
BY THE NUMBER OF UNITS IN THE LINE ITEM. FOR LINE
ITEM 1, THE DRAWBACK ELIGIBILITY PER UNIT IS $.014122 ($70.61
DIVIDED BY 5,000 = $.014122). IF 1,000 WIDGETS FORM THE BASIS
FOR A DRAWBACK CLAIM UNDER 19 USC 1313(J), THE TOTAL AMOUNT OF
DRAWBACK ATTRIBUTABLE TO THE MPF IS $14.12 (1,000 X .014122 =
$14.12).

THE DRAWBACK ENTRY CANNOT BE LIQUIDATED UNTIL ACS ENHANCEMENTS
HAVE BEEN IMPLEMENTED FOR THE MERCHANDISE PROCESSING FEE. THE
MPF REFUND WILL BE DONE AT THE TIME OF LIQUIDATION.

THE CUSTOMARY ACCELERATED PAYMENT OF DUTY AND TAXES SHOULD
PROCEED REGARDLESS OF THE REQUEST FOR MPF REFUND. THE
ACCELERATED PAYMENT DOES NOT INCLUDE THE MPF REFUND.

PROTEST/RELIQUIDATION

ANY PROTEST FOR THIS ISSUE MUST CONTAIN THE SAME DATA AS
REQUIRED FOR REQUESTS TO REFUND THE MPF ON DRAWBACK CLAIMS PRIOR
TO LIQUIDATION. HOWEVER, THE CALCULATION SHOULD BE BASED ON THE
LIQUIDATED VALUE AS OPPOSED TO THE ENTERED VALUE.

THE PROTEST MUST CONTAIN A SEPARATE CALCULATION WORKSHEET FOR
THE FEES. THIS CALCULATION SHEET MUST BE FOR MPF REFUND ONLY
AND REMAIN SEPARATE FROM THE CALCULATION SHEET FOR OTHER DUTIES
AND TAXES FOR WHICH DRAWBACK REFUNDS ARE REQUESTED.

RELIQUIDATION(S) CANNOT BE DONE UNTIL THE ACS ENHANCEMENTS FOR
THE MERCHANDISE PROCESSING FEE HAVE BEEN IMPLEMENTED.

DATE: AUGUST 3, 2000