CSMS Message: 93-000579

TO : ALL ABI BROKERS.

FROM : LISA CROSBY

SUBJECT : GSP-CLAIMS FOR REFUNDS

DATE : 06/18/93

3168071
JUNE 17, 1993

CATEGORY: GSP CO:TO:T:T LAC

TO : REGIONAL DIRECTORS FOR COMMERCIAL OPERATIONS, DISTRICT
AND PORT DIRECTORS

FROM : DIRECTOR
OFFICE OF TRADE OPERATIONS

SUBJECT: RETROACTIVE RENEWAL OF THE GENERALIZED SYSTEM OF
PREFERENCES--REQUESTS FOR REFUNDS

PASS TO: ENTRY OFFICERS, IMPORT SPECIALISTS AND INSPECTORS, AND
OTHER INTERESTED PARTIES SUCH AS BROKERS AND IMPORTERS

BACKGROUND:

AS INDICATED IN EMAIL MESSAGE 3155071, DATED JUNE 9, 1993,
THE GENERALIZED SYSTEM OF PREFERENCES (GSP) WILL EXPIRE AT MIDNIGHT
ON JULY 4, 1993, UNLESS EXTENDED BY LAW. A PROVISION TO RENEW THE
GSP RETROACTIVELY FROM ITS EXPIRATION THROUGH SEPTEMBER 30, 1994,
WAS INCLUDED IN THE 1993 BUDGET RECONCILIATION ACT PASSED BY THE
HOUSE. THE HOUSE'S RENEWAL PROVISION WOULD PERMIT THE REFUND OF
DUTIES PAID WHILE THE PROGRAM WAS LAPSED, UPON THE REQUEST OF THE
IMPORTER; THE SENATE VERSION OF THE 1993 BUDGET RECONCILIATION ACT
DID NOT CONTAIN THE GSP PROVISION. IT IS NOT YET KNOWN WHETHER THE
GSP PROVISION WILL BE ADDED DURING CONFERENCE AND THEREFORE APPEAR
IN THE FINAL BILL THAT IS SIGNED INTO LAW BY THE PRESIDENT.

CUSTOMS HEADQUARTERS RECOGNIZES THE IMPACT THAT RETROACTIVE
RENEWAL AND NUMEROUS RELIQUIDATIONS WILL HAVE ON BOTH IMPORTERS
AND FIELD OFFICES. AFTER CONSULTING WITH REGIONAL OFFICES,
IMPORTERS AND CUSTOMS BROKERS, CUSTOMS HEADQUARTERS HAS DEVELOPED
A MECHANISM TO FACILITATE REFUNDS, SHOULD THE GSP BE RENEWED
RETROACTIVELY. ALTHOUGH CUSTOMS HEADQUARTERS WAS UNABLE TO
ACCOMMODATE EVERY PROPOSAL, THE PLAN DESCRIBED BELOW WORKS BEST
FOR ALL LOCATIONS NATIONWIDE. THIS PLAN WILL BE IMPLEMENTED JULY
5, 1993, IF THE GSP HAS NOT BEEN EXTENDED.

ACTION:
CLAIMS--DUTIES MUST BE DEPOSITED

1. NO CLAIMS FOR DUTY-FREE TREATMENT UNDER THE GSP MAY BE MADE
FOR MERCHANDISE ENTERED OR WITHDRAWN FROM WAREHOUSE ON OR
AFTER JULY 5, 1993. DUTIES AT THE MFN RATE MUST BE DEPOSITED,
OR A CLAIM MAY BE MADE UNDER ANOTHER PREFERENTIAL PROGRAM FOR
WHICH THE MERCHANDISE QUALIFIES (E.G., ANDEAN TRADE PREFERENCE
ACT, CARIBBEAN BASIN INITIATIVE, U.S.-ISRAEL FREE TRADE AREA
AGREEMENT).

19 U.S.C. 58C(B)(8)(B)(III) PROVIDES THAT PRODUCTS OF THE
LEAST-DEVELOPED DEVELOPING COUNTRIES (LDDCS) LISTED IN GENERAL
NOTE 3(C)(II)(B), RELATING TO THE GSP, ARE NOT SUBJECT TO THE
MERCHANDISE PROCESSING FEE. THIS WILL CONTINUE TO BE TRUE
EVEN IF THE GSP EXPIRES.

2. FILERS USING THE AUTOMATED BROKER INTERFACE (ABI) MAY
REPROGRAM THEIR SOFTWARE SO THAT THE SPECIAL PROGRAM INDICATOR
(SPI) FOR THE GSP (THE LETTER "A") CAN STILL BE USED AS A
PREFIX TO THE TARIFF NUMBER BUT WITH THE PAYMENT OF DUTY.
DETAILS ON THE PROGRAMMING CHANGES REQUIRED WILL BE ISSUED
SHORTLY AS AN ADMINISTRATIVE MESSAGE TO ALL ABI FILERS. TO
CONTINUE USING THE SPI "A," FILERS MUST FILE PAPER ENTRY
SUMMARIES AND MUST ALSO FLAG THE SUMMARY WITH A BLUE COVER
SHEET INDICATING THAT THE IMPORTER IS REQUESTING ANY GSP
REFUND AUTHORIZED BY LAW. THIS BLUE COVER SHEET AIDS TRACKING
OF THESE SUMMARIES AND SERVES AS AN AUDIT TRAIL TO EXPLAIN A
LATER REFUND OF DUTIES. SUGGESTED WORDING IS:

TO: U.S. CUSTOMS SERVICE
_______ DISTRICT

THE ATTACHED ENTRY SUMMARY COVERS MERCHANDISE
WHICH MEETS THE REQUIREMENTS OF THE
GENERALIZED SYSTEM OF PREFERENCES (GSP).
PLEASE REFUND DUTIES PAID FOR LINE ITEMS
IDENTIFIED WITH THE PREFIX "A" IF SUCH A
REFUND IS AUTHORIZED BY THE 1993 BUDGET
RECONCILIATION ACT OR OTHER PROVISION OF LAW.

FILERS MAY CONTINUE TO USE THE SPI "A" AS THEY DO NOW (E.G.,
FOR WAREHOUSE ENTRIES, FOR FORMAL CONSUMPTION ENTRIES, FOR
BOTH ABI AND NON-ABI ENTRIES). TO CONSTITUTE A VALID CLAIM
FOR A REFUND, SUMMARIES MUST BE SUBMITTED WITH BOTH THE SPI
"A" AND THE COVER SHEET.

A CLAIM FOR A PREFERENTIAL RATE UNDER ANOTHER TRADE PROGRAM
WILL PRECLUDE USE OF THE SPI "A" TO REQUEST A REFUND. THUS,
AN IMPORTER ENTERING MERCHANDISE USING A REDUCED RATE UNDER
THE U.S.-ISRAEL FREE TRADE AREA AGREEMENT WILL BE PRECLUDED
FROM USING THE "A" TO REQUEST THAT THE U.S.-ISRAEL FTA CLAIM
BE CONVERTED TO A GSP CLAIM, SHOULD THE GSP BE RENEWED
RETROACTIVELY. IMPORTERS, HOWEVER, MAY MAKE SUCH A REQUEST
IN WRITING IF AND WHEN THE GSP IS RENEWED RETROACTIVELY (SEE
PARAGRAPH 10).

THOSE WISHING TO FILE PAPERLESS ENTRY SUMMARIES MAY NOT USE
THE SPI "A" AND MUST REQUEST A REFUND IN WRITING IF AND WHEN
THE GSP IS RENEWED RETROACTIVELY (SEE PARAGRAPH 10).

3. CUSTOMS AUTOMATED COMMERCIAL SYSTEM (ACS) WILL BE REPROGRAMMED
TO ACCEPT THE SPI "A" WITH THE PAYMENT OF DUTY. AFTER JULY
4, THE SPI "A" WILL CONSTITUTE AN IMPORTER'S REQUEST FOR A
REFUND OF DUTIES PAID FOR GSP LINE ITEMS, SHOULD THE GSP BE
RENEWED RETROACTIVELY. CONTINUED USE OF THE SPI "A" HAS
SEVERAL ADVANTAGES: 1) ACS WILL PERFORM ITS USUAL EDITS ON
THE INFORMATION TRANSMITTED BY THE FILER, THEREBY ENSURING GSP
CLAIMS ARE FOR ACCEPTABLE COUNTRY/TARIFF COMBINATIONS; THE
FILER WILL NOT HAVE TO WRITE A LETTER TO CUSTOMS REQUESTING
A REFUND; IT WILL ELIMINATE THE NEED FOR NUMEROUS STATISTICAL
CORRECTIONS, AS DESCRIBED IN PARAGRAPH 4.

4. FOR STATISTICAL PURPOSES, ACS WILL INTERNALLY CONVERT ANY "A"
TRANSMITTED VIA ABI AFTER JULY 4 INTO A "Q"; FOR NON-ABI
SUMMARIES, THE BUREAU OF THE CENSUS WILL CONVERT THE "A" TO
A "Q." IF THE GSP IS RENEWED RETROACTIVELY, CENSUS WILL
CONVERT ALL "Q" STATISTICS INTO "A" STATISTICS, THEREBY
ENSURING THAT NEXT YEAR'S COMPETITIVE NEED LIMITATIONS UNDER
THE GSP ARE ACCURATE. THIS WILL ALSO VASTLY REDUCE THE NUMBER
OF STATISTICAL CORRECTIONS THAT MUST BE DONE BY IMPORT
SPECIALISTS.

5. UPON ACCEPTANCE, ENTRY SUMMARIES WILL BE BYPASSED OR FORWARDED
FOR TEAM REVIEW ACCORDING TO EXISTING SUMMARY SELECTIVITY.

BYPASSED ENTRY SUMMARIES--REBATCHING

6. BYPASSED ENTRY SUMMARIES WILL BE REBATCHED USING THE NEWLY-
CREATED DOCG FUNCTION (GSP ENTRY REFILE). THE BATCH NUMBERS
CREATED BY THIS SPECIAL FUNCTION WILL FLAG THE BATCH AT THE
ENTRY LEVEL WITH THE LETTER "G" FOR "GSP" (E.G. 930706-I17E-
001-G01). ENTRY PERSONNEL WILL MARK THE BATCH FILE FOLDER OR
COVER SHEET WITH THE FULL BATCH NUMBER OF THE FIRST ENTRY
SUMMARY OF THE FIRST BATCH AND MARK THE BOX (OR FILE CABINET)
WITH THE BATCH NUMBER OF THE FIRST AND LAST BATCHES IN THE
BOX, INCLUDING THE ENTRY SEQUENCE (E.G., 930706-I17E-001-G01
THROUGH 930706-TT34-005-G01). ALTERNATELY, ENTRY PERSONNEL
MAY SIMPLY MARK THE BOX "GSP ENTRIES" AND THEN RECORD THE
BATCH INFORMATION AS USUAL.

THE DOCG FUNCTION WILL WORK LIKE THE DOCU FUNCTION, PROMPTING
THE USER WHEN THERE IS REQUEST OR RESERVE OFFICE DATA ON THE
DOCUMENT LOCATION AND RETRIEVAL (DOC) RECORD FOR THE SUMMARY.
SUMMARIES IN THE GSP, DUTY-PAID BATCHES WILL ALSO BE AVAILABLE
FOR RETRIEVAL USING THE DOCR FUNCTION (DOCUMENT FILING
RETRIEVAL REQUEST) AND THROUGH THE DRAWBACK AND PROTEST
MODULES. THE DOCF AND DOCC FUNCTIONS SHOULD BE USED TO UPDATE
THE DOC RECORD FOR THE SUMMARY ACCORDING TO EXISTING DOCUMENT
RETRIEVAL PROCEDURES.

THESE GSP, DUTY-PAID ENTRY SUMMARIES SHOULD NOT BE FORWARDED
TO THE FEDERAL RECORDS CENTER (FRC). IF NECESSARY, OTHER
ENTRIES SHOULD BE SENT TO THE FRC SOONER THAN USUAL TO MAKE
ROOM FOR ON-SITE STORAGE OF GSP, DUTY-PAID SUMMARIES.

ENTRY SUMMARIES DESIGNATED FOR TEAM REVIEW

7. ENTRY SUMMARIES DESIGNATED FOR TEAM REVIEW SHALL BE FORWARDED
TO THE APPROPRIATE COMMODITY SPECIALIST TEAM. ONCE THE TEAM
HAS COMPLETED ITS REVIEW, IT WILL FORWARD THE SUMMARY FOR
LIQUIDATION AS USUAL. BOTH "NO CHANGE" AND "CHANGE"
LIQUIDATIONS (RESULTING FROM ISSUES UNRELATED TO THE GSP
CLAIM) WILL BE PROCESSED AS USUAL--"CHANGE" LIQUIDATIONS WILL
NOT BE DELAYED PENDING RESOLUTION OF THE GSP ISSUE. (ALTHOUGH
IT MAY SEEM MORE EFFICIENT TO DELAY "CHANGE" LIQUIDATIONS
UNTIL THE GSP ISSUE IS RESOLVED--SO THAT DUTIES ON THE GSP
LINE ITEMS CAN BE REFUNDED VIA A "CHANGE" LIQUIDATION--THIS
OPTION IS NOT VIABLE SINCE AN EXTENSIVE DELAY IN GSP RENEWAL
COULD RESULT IN LIQUIDATIONS BY OPERATION OF LAW.) ONCE
LIQUIDATED, THESE ENTRY SUMMARIES SHALL BE REBATCHED USING THE
DOCG FUNCTION, AS DESCRIBED IN PARAGRAPH 6 REGARDING BYPASSED
ENTRY SUMMARIES. ALL GSP, DUTY-PAID SUMMARIES--BOTH "BYPASS"
AND "TEAM REVIEW"--MAY BE REBATCHED AND STORED TOGETHER.

IF THE IMPORT SPECIALIST TEAM CANNOT LIQUIDATE THE ENTRY
SUMMARY BECAUSE OF SOME OUTSTANDING ISSUE (E.G., ANTIDUMPING
DUTIES), THE SUMMARY WILL BE PLACED IN THE APPROPRIATE HOLDING
CODE, ACCORDING TO STANDARD OPERATING PROCEDURES.

IF MERCHANDISE FOR WHICH A GSP CLAIM HAS BEEN MADE IS
INELIGIBLE FOR GSP TREATMENT, THE IMPORT SPECIALIST SHALL
ISSUE A CF 29 ("NOTICE OF ACTION") TO THE IMPORTER INDICATING
THAT THE CLAIM HAS BEEN DENIED. THE IMPORT SPECIALIST SHALL
ALSO SUBMIT CORRECTED STATISTICAL INFORMATION TO CENSUS AND
STRIKE THE "A" PREFIX ON THE CF 7501. BECAUSE DUTIES WILL
HAVE BEEN DEPOSITED, IT WILL BE UNNECESSARY TO LIQUIDATE THE
SUMMARY WITH A CHANGE--THE CF 29 WILL BE THE IMPORTER'S ONLY
NOTIFICATION THAT THE GSP CLAIM HAS BEEN DENIED. IF ALL GSP
CLAIMS ON THE SUMMARY ARE DENIED, THE BLUE COVER SHEET SHALL
BE MARKED "GSP CLAIM DENIED" AND PLACED AT THE BACK OF THE
ENTRY SUMMARY PACKAGE, AND THE SUMMARY SHALL BE SENT FOR
LIQUIDATION AND NORMAL BATCHING. IF GSP HAS BEEN DENIED ONLY
AS TO SOME LINE ITEMS, THE BLUE COVER SHEET SHALL REMAIN AT
THE FRONT OF THE SUMMARY PACKAGE BUT WITH AN ANNOTATION
INDICATING FOR WHICH LINE ITEMS THE GSP CLAIM HAS BEEN DENIED;
STATISTICAL CORRECTIONS SHOULD BE DONE FOR THE APPROPRIATE
LINE ITEMS AND THE CF 7501 SHOULD ALSO REFLECT THE DENIED
CLAIMS. THESE PARTIALLY DENIED SUMMARIES SHOULD BE LIQUIDATED
AND BATCHED WITH THE GSP, DUTY-PAID SUMMARIES SO THAT A REFUND
MAY BE ISSUED FOR THOSE LINE ITEMS WITH A VALID GSP CLAIM.
AS ALWAYS, IMPORTERS MAY PROTEST DENIED GSP CLAIMS UNDER 19
U.S.C. 1514.

INFORMAL ENTRIES

8. INFORMAL ENTRIES FILED VIA ABI ON A CF 7501 SHOULD BE
REBATCHED USING THE DOCG FUNCTION AND STORED WITH THE GSP,
DUTY-PAID SUMMARIES. THE OFFICE OF INSPECTION AND CONTROL
WILL PROVIDE SEPARATE INSTRUCTIONS ON HOW TO HANDLE OTHER
KINDS OF INFORMAL ENTRIES.

REFUNDS

9. IF THE GSP IS RENEWED RETROACTIVELY, CUSTOMS HEADQUARTERS WILL
ISSUE INSTRUCTIONS TO RELIQUIDATE SUMMARIES IN THE GSP, DUTY-
PAID BATCHES WITH A REFUND FOR THE GSP LINE ITEMS, AND TO
PROVIDE ADMINISTRATIVE REFUNDS FOR SUMMARIES THAT CANNOT BE
LIQUIDATED. NO FURTHER ACTION WILL BE REQUIRED BY FILERS.
FIELD LOCATIONS SHALL NOT ISSUE GSP REFUNDS UNTIL INSTRUCTED
TO DO SO BY CUSTOMS HEADQUARTERS.

10. SINCE USE OF THE SPI TO REQUEST A REFUND REQUIRES SOME
REPROGRAMMING BY FILERS, ITS USE IS STRICTLY VOLUNTARY.
FILERS WHO DO NOT WISH TO REPROGRAM HAVE TWO OPTIONS: 1) NOT
USE THE PREFIX "A"; OR 2) FILE SUMMARIES OFF-LINE (NON-ABI).
REFUNDS FOR SUMMARIES FILED WITHOUT THE SPI "A" AND THE BLUE
COVER SHEET MUST BE REQUESTED IN WRITING. INSTRUCTIONS ON HOW
TO REQUEST A REFUND IN WRITING WILL BE ISSUED IF AND WHEN THE
GSP IS RENEWED RETROACTIVELY. ALTHOUGH THE GSP PROVISION AS
CURRENTLY WRITTEN REQUIRES THAT IMPORTERS REQUEST REFUNDS
WITHIN 180 DAYS OF THE DATE OF ENACTMENT OF THE ACT, CUSTOMS
WILL ALLOW CLAIMS UNDER 19 U.S.C. 1520(C). OF COURSE, ENTRY
SUMMARIES FILED USING THE SPI "A" AND THE COVER SHEET WILL
RECEIVE REFUNDS WITHOUT FURTHER ACTION, SINCE THE SPI AND
COVER SHEET CONSTITUTE THE IMPORTER'S ADVANCE REQUEST FOR A
REFUND.

REQUESTS FOR EXTENSION OF LIQUIDATION

11. REQUESTS BY IMPORTERS UNDER 19 U.S.C. 1504(B)(3) FOR AN
EXTENSION OF LIQUIDATION PENDING RENEWAL OF THE GSP SHALL BE
DENIED FOR LACK OF GOOD CAUSE THEREFOR.

QUESTIONS REGARDING THESE INSTRUCTIONS RELATING TO ACS SHOULD
BE DIRECTED TO IRV FISHER AT (202) 927-1220. REMAINING QUESTIONS
MAY BE DIRECTED TO LISA CROSBY AT (202) 927-0163.

PHILIP METZGER

Referenced By

CSMS #93-000614