LIQ-9-01-RR:CR:DR 227605 LTO
Port Director of Customs
819 Water Street, Building 6
Laredo, Texas 78040
ATTN: Protest Section
RE: HQ 227245 modified; Protest 2304-96-100159; Post-Importation Duty Refund Claim;
Merchadise Processing Fees; 19 U.S.C. 1514; 19 U.S.C.
1520(d); 19 CFR 181.21(a)
Dear Sir or Madame:
This in reference to Protest 2304-96-100159, which was
GRANTED IN PART IN
HQ 227245, dated May 6, 1997. We have found that it is necessary
to modify the portion of this decision pertaining to the refund
of merchadise porcessing fees (MPFs) pursuant to 19 U.S.C.
1520(d). Pursuant to section 625 (c) (1), Tariff Act of 1930 (19
U.S.C. 1625(c) (1)), as amended by section 623 of Title VI
(Customs Modernization) of the North American Free Trade
Agreement Implementation Act (Pub. L. 103-182, 107 Stat. 2057),
notice of the proposed modification of HQ 227245 was published in
the Customs Bulletin, Volume 31, Number 35
(August 27, 1997).
FACTS:
In HQ 227245, we found that the requirements for a section
1520(d) post-importation duty refund claim had been met for a
particular entry, and granted the protest [regarding the denial
of the section 1520(d) claim] for this entry, "as to duties only
(underlining n original)."
Quoting the General Notice on Post-Importation Duty Refund Claims
Under the NAFTA in the
Customs Bulletin, Volume 31, Number 5, page 1 (January 29,
1997), we stated that
" [merchandise processing fees] may not be refunded pursuant to
19 U.S.C. 1520(d) and
19 CFR 181.31.'"
ISSUE:
Whether MPFs may be refunded pursuant to 19 U.S.C. 1520(d).
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LAW AND ANALYSIS:
On January 29, 1997, Customs published a General Notice
setting forth our position regarding claims under 19 U.S.C. 1520
(d), which concerns post-importation duty refund claims
for goods qualifying under the NAFTA rules of origin.
Under Article 310 of the North American Free Trade Agreement
(NAFTA) the Parties agreed to maintain the userfee schedule set
forth in Annes 310.1. Section B.1. of that
Annex provides:
The United States shall not increase its
merchandise processing fee and shall
eliminate such fee according to the
schedule set out in Article 403 of the
Canada - United States Free Trade
Agreement on originating goods where
those goods qualify to be marked as
goods of Canada pursuant to Annex 311,
with-out regard to whether the goods are
marked.
The schedule in Article 403 of the U.S.-Canada Free Trade
Agreement, in pertinent
part, provided:
With respect ot goods entered or withdrawn
from warehouse for consumption o or after
January 1, 1994, there shall be no customs
user fee.
Pursuant to section 109 of the NAFTA implementation Act
(Act of December 8, 1993, Pub. L. 103-182, 107 Stat 2057) and
Executive Order No. 12889, 58 F.R. 69681, NAFTA
entered into force on January 1, 1994. The above Agreements Show
that the Parties intended, to eliminate Customs user fees for all
Canadian origin NAFTA originating goods that were
entered on or after January 1, 1994. The Statement of
Administrative Action, H. Doc 103-159,
Vol-1 456 (Nov. 4, 1993) recognizes that the NAFTA incorporates
and carried forward most of the provisions of the U.S.- Canada
Agreement. In fact, at pages 472-473, of H. Doc. 103-159,
Vol. 1, it states that, the purpose of Annex 310.1 was to
reaffirm the requirement imposed by
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the U.S. - Canada Agreement for the U.S. to eliminate its
merchandise processing fee with respect to Canadian goods on
January 1, 1994.
Customs believes tht the expressed intent foran unqualified
elimination of imposition f the merchandise processing fee (MPF)
is best carried out by an equal elimination of the fee to
eligible goods so longas the claim for preference was lawfully
made. Therefore, Customs will refund MPFs pursuant to a section
1520 (d) claim.
HOLDING:
MPFs may be refunded pursuant to 19 U.S.C. 1520(d) and 19
CFR 181.31. Accordingly, refunds of MPFs should be allowed on
any entry on which liquidation or reliquidation has not become
final.
Sincerely,
Stuart P. Seidel
Assistant Commissioner,
Office of Regulations and
Rulings