Recently, U.S. Customs and Border Protection (“CBP”) amended its guidelines for the cancellation and mitigation of claims for liquidated damages in situations where the Petitioner is late in filing claims for relief.  Petitions are considered “untimely” or “late” if they fall outside of the established regulatory time frames or after the expiration of any lawfully obtained extensions.  19 C.F.R. Part 172.

Under the new guidelines, untimely petitions will be accepted or considered only if the petitioner is able to demonstrate the existence of “extraordinary circumstances that prevented the petitioner from filing a timely petition or timely seeking a lawful extension of time in which to file a petition” (with limited exceptions).   The Fines, Penalties, and Forfeitures Officer will exercise his or her discretion in determining whether the Petitioner meets the “extraordinary circumstances” standard.

As far as mitigation is concerned:

In calculating the mitigated amount on a late petition, CBP (with limited exceptions) will:

1. Determine the base amount (i.e., the amount of mitigation that would have been afforded on a timely petition or the previously available option one amount).

2. Determine the “additional mitigation amount” by multiplying the full assessed amount of the claim by 0.1%  (.001) and then multiply by the number of days the petition is late.

3. The product will be the additional amount which will be added to the base amount to produce the mitigated amount applied to the untimely filed petition.

For example, a $100,000 liquidated damages claim for which a petition is filed 30 days late will be mitigated to the amount provided by the guidelines plus an additional amount calculated by the new formula (30 days late x .001 = .03 x 100,000 = $3,000 added charge.)

The above went into effect January 9, 2013.

As discussed above, untimeliness can result into substantial monetary loss.  Thus, it is best to consult with an attorney regarding the new guideline applications and exceptions.

You may call us at 347-512-9007 for more information on your international trade and customs issues.

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