[Title 19 CFR 191.51]
[Code of Federal Regulations (annual edition) - April 1, 2002 Edition]
[Title 19 - CUSTOMS DUTIES]
[Chapter I - UNITED STATES CUSTOMS SERVICE, DEPARTMENT OF THE TREASURY]
[Part 191 - DRAWBACK]
[Subpart E - Completion of Drawback Claims]
[Sec. 191.51 - Completion of drawback claims.]
[From the U.S. Government Printing Office]


19CUSTOMS DUTIES22002-04-012002-04-01false191.51Sec. 191.51CUSTOMS DUTIESUNITED STATES CUSTOMS SERVICE, DEPARTMENT OF THE TREASURYDRAWBACKCompletion of Drawback Claims
Sec. 191.51  Completion of drawback claims.

    (a) General. (1) Complete claim. Unless otherwise specified, a 
complete drawback claim under this part shall consist of the drawback 
entry on Customs Form 7551, applicable certificate(s) of manufacture and 
delivery, applicable Notice(s) of Intent to Export, Destroy, or Return 
Merchandise for Purposes of Drawback, applicable import entry number(s), 
coding sheet unless the data is filed electronically, and evidence of 
exportation or destruction under subpart G of this part.
    (2) Certificates. Additionally, at the time of the filing of the 
claim, the associated certificate(s) of delivery must be in the 
possession of the party to whom the merchandise or article covered by 
the certificate was delivered. Any required certificate(s) of 
manufacture and delivery, if not previously filed with Customs, must be 
filed with the claim. Previously filed certificates of manufacture and 
delivery, if required, shall be referenced in the claim.
    (b) Drawback due--(1) Claimant required to calculate drawback. 
Drawback claimants are required to correctly calculate the amount of 
drawback due. The amount of drawback requested on the drawback entry is 
generally to be 99 percent of the import duties eligible for drawback. 
(For example, if $1,000 in import duties are eligible for drawback less 
1 percent ($10), the amount claimed on the drawback entry should be for 
$990.) Claims exceeding 99 percent (or 100% when 100% of the duty is 
available for drawback) will not be paid until the calculations have 
been corrected by the claimant. Claims for less than 99 percent (or 100% 
when 100% of the duty is available for drawback) will be paid as filed, 
unless the claimant amends the claim in accordance with Sec. 191.52(c).
    (2) Merchandise processing fee apportionment calculation. Where a 
drawback claimant seeks unused merchandise drawback pursuant to 19 
U.S.C. 1313(j) for a merchandise processing fee paid pursuant to 19 
U.S.C. 58c(a)(9)(A), the claimant is required to correctly apportion the 
fee to that merchandise

[[Page 547]]

that provides the basis for drawback when calculating the amount of 
drawback requested on the drawback entry. This is determined as follows:
    (i) Relative value ratio for each line item. The value of each line 
item of entered merchandise subject to a merchandise processing fee is 
calculated (to four decimal places) by dividing the value of the line 
item subject to the fee by the total value of entered merchandise 
subject to the fee. The resulting value forms the relative value ratio.
    (ii) Merchandise processing fee apportioned to each line item. To 
apportion the merchandise processing fee to each line item, the relative 
value ratio for each line item is multiplied by the merchandise 
processing fee paid.
    (iii) Amount of merchandise processing fee eligible for drawback per 
line item. The amount of merchandise processing fee apportioned to each 
line item is multiplied by 99 percent to calculate that portion of the 
fee attributable to each line item that is eligible for drawback.
    (iv) Amount of merchandise processing fee eligible for drawback per 
unit of merchandise. To calculate the amount of a merchandise processing 
fee eligible for drawback per unit of merchandise, the line item amount 
that is eligible for drawback is divided by the number of units covered 
by that line item (to two decimal places).

    Example 1:   
Line item 1--5,000 articles valued at $10 each total $50,000
Line item 2--6,000 articles valued at $15 each total $90,000
Line item 3--10,000 articles valued at $20 each total $200,000
Total units = 21,000
Total value = $340,000
Merchandise processing fee = $485 (for purposes of this example, the fee 
cap of $485, as per 19 U.S.C. 58c(a)(9)(B)(i), is applicable)

    Line item relative value ratios. The relative value ratio for line 
item 1 is calculated by dividing the value of that line item by the 
total value ($50,000 / 340,000 = .1470). The relative value ratio for 
line item 2 is .2647. The relative value ratio for line item 3 is .5882.
    Merchandise processing fee apportioned to each line item. The amount 
of fee attributable to each line item is calculated by multiplying $485 
by the applicable relative value ratio. The amount of the $485 fee 
attributable to line item 1 is $71.295 (.1470 x $485 = $71.295). The 
amount of the fee attributable to line item 2 is $128.3795 (.2647 x $485 
= $128.3795). The amount of the fee attributable to line item 3 is 
$285.277 (.5882 x $485 = $285.277).
    Amount of merchandise processing fee eligible for drawback per line 
item. The amount of merchandise processing fee eligible for drawback for 
line item 1 is $70.5821 / (.99 x $71.295). The amount of fee eligible 
for drawback for line item 2 is $127.0957 (.99 x $128.3795). The amount 
of fee eligible for drawback for line item 3 is $282.4242 (.99 x 
$285.277).
    Amount of merchandise processing fee eligible for drawback per unit 
of merchandise. The amount of merchandise processing fee eligible for 
drawback per unit of merchandise is calculated by dividing the amount of 
fee eligible for drawback for the line item by the number of units in 
the line item. For line item 1, the amount of merchandise processing fee 
eligible for drawback per unit is $.0141 ($70.5821 / 5,000 = $.0141). If 
1,000 widgets form the basis of a claim for drawback under 19 U.S.C. 
1313(j), the total amount of drawback attributable to the merchandise 
processing fee is $14.10 (1,000 x .0141 = $14.10). For line item 2, the 
amount of fee eligible for drawback per unit is $.0212 ($127.0957 / 
6,000 = $.0212). For line item 3, the amount of fee eligible for 
drawback per unit is $.0282 ($282.4242 / 10,000 = $.0282).
    Example 2: This example illustrates the treatment of dutiable 
merchandise that is exempt from the merchandise processing fee and duty-
free merchandise that is subject to the merchandise processing fee.

Line item 1--700 meters of printed cloth valued at $10 per meter (total 
value $70,000) that is exempt from the merchandise processing fee under 
19 U.S.C. 58c(b)(8)(ii)(B)(iii)
Line item 2--15,000 articles valued at $100 each (total value 
$1,500,000)
Line item 3--10,000 duty-free articles valued at $50 each (total value 
$500,000)

    The relative value ratios are calculated using line items 2 and 3 
only, as there is no merchandise processing fee imposed by reason of 
importation on line item 1.

Line item 2--1,500,000 / 2,000,000 = .75 (line items 2 and 3 form the 
total value of the merchandise subject to the merchandise processing 
fee).
Line item 3--500,000 / 2,000,000 = .25

    If the total merchandise processing fee paid was $485, the amount of 
the fee attributable to line item 2 is $363.75 (.75 x $485 = $363.75). 
The amount of the fee attributable to line item 3 is $121.25 (.25 x $485 
= $121.25).
    The amount of drawback on the merchandise processing fee 
attributable to each unit of line item 2 is $.0243 ($363.75 / 15,000 = 
$.02430). The amount of drawback on the merchandise processing fee 
attributable to

[[Page 548]]

each unit of line item 3 is $.0121 ($121.25 / 10,000 = $.0121).
    If 1,000 units of line item 2 were exported, the drawback 
attributable to the merchandise processing fee is $24.23 ($.02423 x 
1,000 = $24.23).

    (c) HTSUS number(s) or Schedule B commodity number(s) of imports and 
exports. (1) General. Drawback claimants are required to provide, on all 
drawback claims they submit, the Harmonized Tariff Schedule of the 
United States (HTSUS) number(s) for the designated imported merchandise 
and the HTSUS number(s) or the Schedule B commodity number(s) for the 
exported article or articles.
    (2) Imports. For imports, HTSUS numbers shall be provided from the 
entry summary(s) and other entry documentation, when the claimant is the 
importer of record, or from the certificate of delivery and/or the 
certificate of manufacture and delivery, otherwise. Manufacturing 
drawback claimants filing drawback claims based on certificate(s) of 
manufacture and delivery filed with the claims or previously filed with 
Customs (see paragraph (a) of this section), may meet this requirement 
with the HTSUS number(s) for the designated imported merchandise on such 
certificate(s).
    (3) Exports. For exports, the HTSUS number(s) or Schedule B 
commodity number(s) shall be from the Shipper's Export Declaration(s) 
(SEDs), when required. If no SED is required (see, e.g., 15 CFR 30.58), 
the claimant shall provide the Schedule B commodity number(s) or HTSUS 
number(s) that the exporter would have set forth on the SED, but for the 
exemption from the requirement for an SED.
    (4) 6-digit level for HTSUS and Schedule B commodity numbers. The 
HTSUS numbers and Schedule B commodity numbers shall be stated to at 
least 6 digits.
    (5) Effective date. For imports, HTSUS numbers are required for 
merchandise entered, or withdrawn from warehouse, for consumption on or 
after April 6, 1998. For exports, HTSUS numbers or Schedule B commodity 
numbers are required for exported merchandise or articles exported on or 
after the date 1 year after April 6, 1998.
    (d) Place of filing. For manufacturing drawback, the claimant shall 
file the drawback claim with the drawback office listed, as appropriate, 
in the general manufacturing drawback ruling or the specific 
manufacturing drawback ruling (see Secs. 191.7 and 191.8 of this part). 
For other kinds of drawback, the claimant shall file the claim with any 
drawback office.
    (e) Time of filing. (1) General. A completed drawback claim, with 
all required documents, shall be filed within 3 years after the date of 
exportation or destruction of the merchandise or articles which are the 
subject of the claim. Except for landing certificates (see Sec. 191.76 
of this part), or unless this time is extended as provided in paragraph 
(e)(2) of this section, claims not completed within the 3-year period 
shall be considered abandoned. Except as provided in paragraph (e)(2) of 
this section, no extension will be granted unless it is established that 
Customs was responsible for the untimely filing.
    (2) Major disaster. The 3-year period for filing a completed 
drawback claim provided for in paragraph (e)(1) of this section may be 
extended for a period not to exceed 18 months if:
    (i) The claimant establishes to the satisfaction of Customs that the 
claimant was unable to file the drawback claim because of an event 
declared by the President to be a major disaster, within the meaning 
given to that term in 42 U.S.C. 5122(2), on or after January 1, 1994; 
and
    (ii) The claimant files a request for such extension with Customs 
within 1 year from the last day of the 3-year period referred to in 
paragraph (e)(1) of this section.
    (3) Record retention. If an extension is granted with respect to a 
request filed under paragraph (e)(2)(ii) of this section, the periods of 
time for retaining records under 19 U.S.C. 1508(c)(3) shall be extended 
for an additional 18 months.

[T.D. 98-16, 63 FR 11006, Mar. 5, 1998, as amended by T.D. 01-14, 66 FR 
8767, Feb. 2, 2001; T.D. 01-18, 66 FR 9649, Feb. 9, 2001]