Case Studies

There’s Nothing Quite Like a Government Refund Check.

Client

A "motor" importer

Year

2016

Service

Customs brokerage

Challenge

Proper classification at the time of importation is critical. The tariff has tens of thousands of numbers and some items are specifically provided for while others are left more vague. Getting it right requires an understanding of the General Rules of Interpretation (GRI’s), Section Notes, Chapter Notes and in some cases, existing rulings or case law.

We came upon an importer in the Chicago area bringing in motors, or so it appeared from all our initial research. A related party to a European parent company, the parent was putting an HTS number on the invoice that their Customs broker was using to make entry. When we visited their facility and started asking questions and actually saw the product, we felt strongly that the classification was incorrect.

There's Nothing Quite Like a Government Refund Check

Solution

Camelot has five licensed Customs brokers and eight Certified Classification Specialists. We have been rigorously trained in the methodology used to classify products for importation. When we began to explore the tariff in greater detail, we discovered a flaw in the classification. Because their existing Customs broker was using the HTS provided on the invoice, they were paying four percent duty, ad valorem, on shipments with an average entered value of $200,000. This meant for each shipment, they were paying $8,000 in duty.

Using existing rulings and the rules and tools of proper classification, we determined that the goods could rightly be entered elsewhere in the tariff duty-free.

When we pointed this out to the importer, we immediately protested the entries within our control and they had the (now) former Customs broker protest the entries in their control.

The result for them? More than $50,000 in refunds - and no more paying duty on their product.

OLD DUTY RATE:

4%

NEW DUTY RATE:

0%

DUTY RECOVERED

$50,000

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