If you and your company are involved in international trade, at some point you may have U.S. origin products that must be returned to your facility. U.S. exporters are often surprised that they must follow U.S. Customs and Border Protection’s (CBP) requirements for the return of goods from their international customers.
"It should be simple," they often say. "The customer is just sending back something they don’t need, or the product must be repaired."
Because CBP is required to protect commerce of the United States (and much more), they want written proof that shipments being imported into the U.S. qualify for duty-free status along with the proper classification number.
Manufacturer's Affidavit for Import
That’s where a Manufacturer’s Affidavit comes in. Also known as a Declaration for Free Entry of Returned American Products, importers use it to verify that commodities valued over $2,500 are of U.S. origin, they have not been altered outside of the U.S., and they can enter the country duty-free under Harmonized Tariff Schedule Numbers 9801.00.10 or 9802.00.20.
CBP gives importers specific instructions for preparing the supporting documentation in the Code of Federal Regulations, 19 CFR Part 10.1, which is available at the Cornell University Law School’s website. However, the instructions can be difficult to read and apply in day-to-day business transactions. That’s why a U.S. Customs Broker is often called upon by importers to help prepare and submit the appropriate documentation.
Upon reading the regulations, you will find the documentary requirements include a sample Manufacturer’s Affidavit to use if the value of the goods is greater than $2,500. This declaration can be made by the owner, importer, consignee or agent of the importer who has knowledge of the facts regarding the claim for free entry.
If the owner or ultimate consignee is a corporation, the president, vice president, secretary or treasurer of the corporation may sign the declaration. It may also be signed by any employee or agent of the corporation who holds a power of attorney executed under the conditions outlined in the same regulations (CFR 19, subpart C, part 141) if the corporation can certify that the employee or other agent has or will have knowledge of the pertinent facts.
I, _______________, declare that the (above) (attached) declaration by the foreign shipper is true and correct to the best of my knowledge and belief, that the articles were manufactured by __________________ (name of manufacturer) located in ___________________ (city and state), that the articles were not manufactured or produced in the United States under subheading 9813.00.05, HTSUS, and that the articles were exported from the United States without benefit of drawback.
Additional Documentary Requirements
CBP may require additional supporting documentation if, for example, the value of the returned merchandise exceeds $2,500 and the goods aren’t clearly marked with the name and address of the U.S. manufacturer. The CBP Port Director may require other documentation or evidence to substantiate the claim for duty-free treatment, including:
- Statement from the U.S. manufacturer verifying that the articles were made in the United States,
- U.S. export invoice,
- Bill of lading or airway bill evidencing the U.S. origin of the articles, and/or
- The reason for the exportation of the articles.
CBP takes care to provide other options in the regulations for unique situations. The following points were excerpted from the regulations. Before using these options, please read CBP’s specific requirements for each situation:
- A certificate from the master of a vessel stating that products of the United States are returned without having been unladen from the exporting vessel may be accepted in lieu of the declaration of the foreign shipper.
- Photographic films and dry plates manufactured in the United States (except motion picture films to be used for commercial purposes) exposed abroad and entered under subheading 9802.00.20.
- Aircraft and aircraft parts and equipment.
- Nonconsumable vessel stores and equipment.
- When the total value of articles of claimed American origin contained in any shipment does not exceed $250, are products of the United States and do not appear to have been advanced in value or improved in condition while abroad and no quota is involved. If these requirements are met, free entry may be made under subheading 9801.00.10 on Customs Form 3311, executed by the owner, importer, consignee, or agent and filed in duplicate, without the requirement of filing documentation.
- When the aggregate value of the shipment does not exceed $10,000 and the products are imported (1) for the purposes of repair or alteration, prior to reexportation, or (2) after having been either rejected or returned by the foreign purchaser to the United States for credit, free entry may be made under subheading 9801.00.10 on Customs Form 3311 without the Manufacturer’s Certificate/Affidavit.
There are two additional documents required by CBP when U.S. goods are returned; they include the Foreign Shipper’s Declaration and the Importers Declaration. The format for these declarations are found at the Cornell University Law School’s website.
If you are an exporter who is an “accidental importer,” develop a strategy with your import Customs Broker covering such items as:
- Materials Return Authorization policy,
- Proper product classification,
- Record retention,
- Wording to be included in the import international bill of lading, and statement of value and origin (invoice for customs purposes), and
- Customs broker fees.
If your firm appropriately uses the Manufacturer’s Affidavit, you can save your firm money!
This article, which was first published in February 2003, has been updated to include current information and web links.