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Business Groups Seek Quick Fix of USMCA Merchandise Processing Fee ‘Drafting Error’

Posted July 08, 2020


A coalition of more than 100 business groups led by the U.S. Chamber of Commerce and the National Association of Manufacturers is calling on lawmakers to fix what that they say is a costly “drafting error” in the implementing legislation of the new United States-Mexico-Canada Agreement.

DHS Seal, Money Jar w/ Change, US-Canada-Mexican flags
Section 205 of the USMCA Implementation Act allows companies to claim a refund of the nominal government merchandise processing fee at the time their imports enter the United States. But unlike other U.S. free trade agreements, the USMCA provision prevents companies from filing a post-importation claim for refunds.

In a letter sent to leaders of the Senate Finance and House Ways and Means committees, the groups say that without the requested change being made, importers will face millions of dollars in additional processing fees because of all the post-importation claims expected to be filed in coming months. 

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Background


The request is not a new one, having been made previously during the public hearing process on the USMCA by the United States Trade Representative (here and here). Business groups then said that “Congress must work quickly to pass a technical correction amendment that would allow refund of these fees after importation by or shortly after the USMCA July 1 Entry into Force date.”  

Notably, at the same time, the Trump administration had indicated its support for a “technical correction” to the USMCA’s implementing bill’s language on MPF refunds, according to USTR Robert Lighthizer. Despite this, however, the alleged “drafting error” remained unchanged prior to the USMCA taking effect.    

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Looking Ahead


Another update to the USMCA implementing bill is expected to be published soon, perhaps in the next few weeks, to correct numerous technical errors and oversights made during the rush to meet the administration’s July 1 implementation date.

Given that Congressional lawmakers, the USTR, and Customs and Border Protection all agree this MPF technical correction needs to be passed, it seems reasonable to expect it will likely be included in the next version of the legislation.  

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Need More Information?


If you have any questions about this issue or other regulatory changes associated with implementation of the USMCA, don’t hesitate to contact one of our knowledgeable trade experts today.

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