Is Your Organization Eligible for Duty Drawback?

Determining your organization's eligibility for the U.S. Customs Duty Drawback Program is a crucial first step in reclaiming potential refunds on duties paid. I recently sat down with a colleague to discuss the types of organizations that may qualify. You can watch the video below or continue reading for a summary.

Understanding Duty Drawback

Duty drawback allows companies to reclaim duties, also called tariffs, paid on imported goods that are subsequently exported or destroyed. This process, however, involves navigating complex regulations and maintaining extensive documentation — factors that can make or break a claims filing.

Who is Eligible for Duty Drawback? Eligibility for duty drawback includes various parties involved in importing and exporting goods. Here are the four main types of organizations CITTA Brokerage works with:

Importer and Exporter of Record: Organizations that both import and export goods are directly eligible for duty drawback, allowing straightforward reclamation of duties.
Exporter Who is Not the Importer: If your company exports goods purchased domestically, you can still qualify by collaborating with the importer to recover duties, especially when dealing with multiple suppliers.
Importer Who is Not the Exporter: Companies that only import goods, which are then exported by another party, may qualify by coordinating with the exporter to claim refunds.
Intermediate Consignee: In complex transactions involving multiple parties, eligibility extends to intermediate consignees. Coordination and non-disclosure agreements are often necessary to protect proprietary information while enabling cooperation.

The Importance of Collaboration

Collaboration among all parties involved in the supply chain is critical to successfully navigating the duty drawback process. Stakeholders are often internally motivated to cooperate, especially when duty-embedded costs are involved, leading to potential price negotiation opportunities. A brokerage specializing in duty drawback can play a vital role in facilitating these relationships, ensuring compliance and maximizing returns.

Why Work with a Brokerage?

The duty drawback process is complex, involving extensive documentation and stringent compliance requirements. Working with a brokerage that specializes in duty drawback can help simplify this process, ensuring that claims are filed correctly and that all regulatory requirements are met. A brokerage's expertise in managing relationships, protecting sensitive information, and maintaining compliance is invaluable in maximizing potential refunds.

Learn More

To better understand if your organization is eligible for duty drawback, visit CITTABrokerage.com or write to info@CITTABrokerage.com.

*Jade Goodell is a licensed customs broker and the Director of Operations at CITTA Brokerage, a customs brokerage that helps businesses compete globally by maximizing their trade rights by forging strong partnerships with clients, their brokers, freight forwards, and other stakeholders.