FINES, PENALTIES and Protests

Claims | PROTESTS | FINES AND PENALTIES | PETITIONS

Claims depending on type of transaction:

1. PERSPECTIVE TRANSACTIONS - Goods had not arrived into the USA and entry had not been made.
2. CURRENT TRANSACTIONS - Entry had been made but not liquidated yet.
3. COMPLETED TRANSACTIONS - Entry is done but there is still a problem.

PERSPECTIVE TRANSACTIONS:

a. Importer write a letter (no special form) to Port Director with description of product. Port Director will respond.
Benefit: Quick response. Drawback: Valid in the particular port only. Another port may assign higher duty.

b. If importing something new, then write a letter (no special form) to JFK National Import Specialist or to headquarters. It will be evaluated, assigned new HTS# and binding to all ports.

CURRENT TRANSACTIONS:

Importer has to request for Internal Advise (under part 177)

• Importer gives his written position to Port Director;
• The Port Director (Import Specialist) must write back a letter with his position;
• Both statements sent to headquarters and the headquarters makes decision what ruling is going to be.

If importer wants correct clerical errors in liquidation (part 173) then importer writes a letter "Correction of clerical errors" to Port Director:

• Part 173.4(a) claim - if heed to correct clerical errors in payment of duty;
• Claims 528; 528.4; 1520.4 etc for different types of errors.

COMPLETED TRANSACTIONS:

Claim under part 173.3 "Request for voluntary re-liquidation".
Customs or Broker can re-liquidate entry within 90 days of the liquidation.
I.e. after liquidation you must wait 90 more day to be assured that the liquidation is final.

Re-liquidation is for correction clerical errors. After 90 days, if Customs does not respond, then the claim automatically becomes favorable to the importer.

PROTESTS. (CFR 19.174)

Importer must file protest within 90 days of liquidation.

Protests CANNOT be favorable to Customs. It can be favorable to the importer only.

• Importer file protest in the appropriate form IN THE SAME PORT WHERE THE ENTRY WAS MADE.
  It must be received by Customs within 90 days of the liquidation (not post marked).
• Customs must responds within 2 (TWO) years. I Customs does not, then importer won by operation of low.

Acceleration of review or disposition. This situation when importer informally knows that Customs will deny his protest and willing to appeal further:

1. Importer files a regular protest;
2. After 90 days he submits a Letter with title to Accelerate the review or Disposition;
3. Now Customs has 30 days to respond;
4. If Customs did not respond THEN IMPORTER LOSE and;
5. Importer has right to appeal.
6. Appeal to Court of International Trade in 180 days. If you lose then;
7. U.S. Court of Appeal. If you lose then;
8. Appeal to Supreme Court.

Notice:

• NAFTA errors goes under 520(d) claims
• For everything else form 520(c)
  

FINES AND PENALTIES (CFR 19.171 appendix):

Under Tariff act of 1930:

• 19 USC 1497 - for PASSENGERS ONLY = Appendix A;
• 19 USC 1592 - for Customs Brokers and Importers = Appendix B;
• 19 USC 1641 - for Customs Brokers ONLY = Appendix C

All fines and penalties have different levels. As the result you can have a MITIGATING or AGGRAVATING factor.

• MITIGATING factor - invulnerably mistakes. It may decrease fine;
• Regular fee;
• AGGRAVATING factor - when Customs feel that something could be done to prevent it, but it had not been done. It may increase fine.

NOTICE: Total value of fine is Value of goods (1) + Duty on it (2) + Fine itself (3)

* - DOMESTIC VALUE is VALUE OF GOODS + DUTY & TAXES

** - This is for FALSE statements in documents. It DOES NOT apply to clerical errors or mistakes of facts. Customs officer issues to violator PRE-PENALTY NOTICE. It states a culpability level: Negligence (1); Gross Negligence (2); or Fraud (3). For Negligence and Gross Negligence it must be over $500.

*** - Government lost revenue.

**** - Duty free merchandises.

PETITIONS

4097; 5092; 6041 forms letter must be sand from a Penalty Notice:

• If it final penalty - within 60 days (19 CFR 171(g));
• If against Broker - within 30 days;
• If you must to expedite it - within 20 days

While filing a petition you can request for the Oral Presentation. It must be in writing in the original petition. Otherwise, you lose right to the Oral Presentation.