LIST 3 EXCLUSION REQUEST PROCESS
OPENS ON JUNE 30
June 20, 2019:
Back in early May, the USTR announced that LIST 3 rates would be increasing to 25%, and a committment was made to open a process for importers to request product exclusions from the LIST 3 tariffs. The imposition of the 25% rates was then delayed for a short period. Today, a
notice
from the USTR now announces the opening of the exclusion process:
"June 30, 2019 at noon EDT: The web portal for submitting exclusion requests - http://exclusions.USTR.gov - will open."
The notice explains that the exclusion requests are to be filed through a new portal system found at
exclusions.ustr.gov/
.
The submission of these
petitions must be filed by the
deadline for filing on Sept. 30, 2019.
Companies who might wish to rebut certain exclusion requests are obligated to monitor the portal and to respond with 14 days after said posts.
The USTR will then review these exclusion requests on a case-by-case basis. The USTR states that this analysis takes into account:
- The asserted rationale for the exclusion,
- Whether the exclusion would undermine the objective of the Section 301 investigation, and
- Whether the request defines the product with sufficient precision.
We have found that for many companies seeking exclusions, there is a significant amount of work and preparation required to adequately articulate and support the various factors and data that are required in the exclusion applications. As we have urged previously, companies list LIST 3 products should begin preparations for these filings as soon as possible. We do urge that companies with significant LIST 3 exposure consider immediately begin working a law firm experienced in both Customs law and with this exclusion process.
As has been the case with LIST 1 and 2 exclusion decisions, the decisions against LIST 3 exclusion applications will be issued on a rolling basis and over a significant period of time after the applications are filed.
If
a LIST 3 exclusion is ultimately granted by the USTR, the decision will valid for a period of one year from its date of publication in the Federal Register.
The exclusion will also be effective
retroactively
to the original start date of the 10% LIST 3 tariffs on Sept. 24, 2018 (meaning that importers might seek refunds from U.S. Customs on the basis of a future USTR exclusion --
provided
that the importer has protected the right to all such refunds).
In order to protect that right of refund, protests may be necessary now, or in the future, to prevent the expiry of the statute of limitations on refund claims under 19 U.S.C. 1514.
The reason for the need for protests lies in the structure of our import laws which currently require that an importer file timely protests to U.S. Customs within 180 days of the "liquidation" of an entry. ("Liquidation" is a legal event referring to the finalization of the entry and the duties payments arising from it). Again, we suggest it is critical that importers work with a legal expert to ensure that these potentially significant amounts are not lost simply due to procedural oversights.
