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CBP Addresses Questions About 90-Day Duty Deferral

Posted May 01, 2020

U.S. Customs and Border Protection recently provided additional guidance in response to questions about its 90-day deferral of certain estimated duties and taxes for companies experiencing significant financial hardships resulting from the COVID-19 pandemic. 

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Key Points
  • Non-resident importers of record that can demonstrate significant financial hardship are also eligible for temporary duty deferral.
  • In addition to certain estimated duties, the 90-day deferral also applies to federal excise taxes on imported products.
  • Importers must maintain documentation as part of its books and records establishing that it meets the requirements for relief. This should include copies of all the shelter in place and similar COVID-19 orders issued by the various levels of government with jurisdiction over their locality. CBP said it may conduct future reviews to ensure compliance.
  • Importers whose operations have been deemed essential, but those operations were negatively impacted in accordance with the significant financial hardship requirements, will be considered for deferment eligibility on a case-by-case basis.
  • If the importer of record’s retail stores are closed due to the pandemic but its online store is operational, this will qualify as a partial suspension of operations for purposes of the deferral.
  • For entries eligible for the deferment, the importer of record must still have a valid continuous or single transaction bond on file at the time of entry filing, and current bond formulas apply.
  • The Automated Commercial Environment will not liquidate entries for which payment has not been received due to the deferral, and after the deferral period any entry not paid will be liquidated and a bill will be issued.
  • Importers should not make drawbacks against entries during the duty deferral period. CBP advises importers delaying duty payment to not file any drawback claims until such time as payments have been properly made on the import entry(s).


No Plans to Extend Duty Deferrals

CBP is reportedly not currently planning to extend the 90-day customs duty deferral option beyond April, according to an agency official during an April 30 conference call.

It should be noted that CBP lacks the authority to grant additional days for payment of duties, taxes and fees. Any further extensions of the temporary duty postponement would, therefore, need to be initiated by another executive order from the president, or possibly even legislated by Congress. 


Need More Information?

If you have any questions about any customs or other regulatory issues related to the coronavirus pandemic and how they might impact your business, don’t hesitate to contact one of our trade experts today. Also, be sure to get the latest trade-related developments in response to the pandemic by visiting our COVID-19 Updates page.

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