The Court Says No Juridiction to Hear Ford Certificate of Origin Case
The U.S. Court of International Trade (USCIT) issued a decision this week and threw out request by Ford requesting that U.S. CBP be ordered to consider post-entry refund claims filed after one year from the date of importation. for a copy of the decision, please go to the following link - www.cit.uscourts.gov/slip_op/Slip_op10/10-4.pdf
The facts are that Ford imported parts from Canada into the United States and paid duties at the MFN rate. Ford did not claim NAFTA duty-free treatment at the time of entry. U.S. CBP liquidated the merchandise as dutiable. Subsequent to the date of entry, Ford filed a refund claim for post-entry NAFTA treatment and requested the return of the duties paid. However, and this is the key fact, Ford did not provide copies of the certificates of origin at the time of the entry or at the time of the refund claim. Ford did provide certificates of origin after one year had passed from the date of entry.
Due to the fact that the certificates of origin were not provided within one year of the date of importation, USCBP denied the refund claim. Ford protested and USCBP denied the protest.
The USCIT strictly construed the one year limitation period and determined that it did not have jurisdiction. Without a valid claim, there could be no valid protest of USCBP' denial of the claim.
This case is important to Canadian businesses for many reasons including:
1) Canadian exporters should review their contracts with US-based buyers to ensure that they comply with document production requirements on time in order to avoid being sued for the damages caused by their failures;
2) Canadian importers should consider what would the Canada Border Services Agency do in similar circumstances - in Canada, to claim duty-free NAFTA (or FTA) treatment, the certificate of origin must be available at the time of importation);
3) Importers should revisit their document collection procedures and their procedures for communicating relevant information to Customs within the required time frames; and
4) Importers and exporters should consider whether to discuss with government the severity and strictness of the rule and its negative effects on manufacturing businesses. In the current economic climate it seems that governments should by willing to accept late-filed documents so long as the information can be verified as the underlying facts are what should determine whether unrecoverable duties are payable or not.
