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Change in 19 CFR Part 159 regarding Liquidation Time Limit for Duty Drawback Entries

Nancy Hiromoto, N.F. Stroth & Associates

It has been a long time coming, but finally, the trade will receive the benefit of a maximum time limit in which drawback entries must liquidate. In accordance to the public notice issued in the Federal Register on August 26, 2010, the statutory time limit for the liquidation of duty drawback entries will be limited to one year. Previously, there was no time limit established for drawback entries, which resulted in drawback claims being left open for many, many years. This unreasonable open-ended time period meant that old claims were left vulnerable to challenge by CBP. This resulted in not only delay in duty refund to the claimant, but CBP requests for claimant to re-create old claims (sometimes as far back as ten years ago) and prolonged recordkeeping of documents.

The new formal regulation will clearly lessen the liabilities of a drawback claimant, especially those who currently enjoy the privileges of accelerated payment. With the liquidation time limit for drawback entries now similar to liquidation of import entries, drawback claimants may now better plan for all the areas involved in their drawback program. 19 CFR Part 159.11(b) will be amended by removing the language that excluded drawback entries from falling under the statutory liquidation time limit of one year.