LGLS Final - Chapter 12

Same-Condition Drawback

A drawback of duties paid on imported goods that are re-exported in the "same condition" as they were imported, provided they were not significantly altered.

Port of Entry

A major seaport, airport, inland port, and border crossing in which a customs office is located.

Tariff Classification

A method of categorizing different types or kinds of goods based on a uniform descriptive nomenclature or terminology, according to their tariff name, use, or physical characteristic.

Essential Character

A method of classification that is helpful in determining the classification of a mixture of chemicals, foodstuffs, and other substances or materials blended together, assuming that there is no classification that fits the mixture.

Manufacturing Drawback

A ninety-nine percent refund of duties and taxes paid on merchandise that is imported, subjected to manufacture or production, and then exported in five years.

Rejected Merchandise Drawback

Is allowed for imported merchandise that was shipped without consent, is defective, or does not conform to specifications or to samples.

Commercial Invoice

Is required for all shipments intended for sale or commercial use in the United States.

Foreign Trade Zone

Legally defined sites within a country that are subject to special customs procedures.

Ultimate Purchaser

The last person in the United States who receives an article in the form in which it was imported.

Rules of Origin

The legal rules used to determine the country of origin of imported products.

Dutiable Status

The legal status of imported goods at the time of entry for purposes of compliance with the tariff and customs laws.

Transaction Value

The price actually paid or payable for the merchandise when sold for export to the United States .

Entry Process

The process by which authorities determine whether any import prohibitions or restrictions apply to the goods, whether the goods are subject to any other laws or regulations affecting their entry, and whether any tariffs or import duties are due.

Tariff Engineering

The process of modifying or engineering a product prior to importation for the purposes of obtaining a lower rate of duty.

Value-Added Test

The test that determines whether a substantial transformation has resulted in an increase in value.

Notice of Adjustment

The way by which an importer is notified that additional duties are owed at the point of entry.

Non-preferential Rules of Orgin

Those rules applicable to imports from developed countries that receive normal tariff treatment.

Preferential Rules of Origin

Those rules rules applicable to goods traded within a free trade area or customs union, or that receive preferential tariff treatment under trade preference programs for developing countries.

Contract Manufacturing

A business arrangement in which the production of goods is contracted or outsourced by one firm to a manufacturing firm, often overseas.

Compound Tariff Rate

A combination of both ad valorem and specific rates.

Ad Valorem Tariff Rate

A rate based on a percentage of the value of the articles imported.

Drawback

A refund of duties already paid on imported goods when the goods are re-exported or destroyed.

Specific Tariff Rate

A specified amount per unit of weight or measure.

Regional value Content Test

A type of Value-Added Test that requires that some minimum percentage of the value of a finished article be added in a country in order for it to have "originated" there.

Production Assists

Also called dutiable assists are goods, services ,or intellectual property furnished by the importer to a foreign producer, free or at a reduced price, for use in producing merchandise for import and sale in the United States.

Customs Broker

An authorized agent, licensed by federal law, to act for and on behalf of importers in making entry of goods.

General Rules of Interpretation (GRI)

Both the procedural and substantive rules for for arriving at the correct classification.

Tariff Schedule

Classifications and tariff rates for each item are found here according to the country of origin

Customs Fraud

Clear and convincing evidence that the importer knowingly made a materially false statement of omission while entering the or attempting to enter goods into the United States.

Substantial Transformation

Occurs when the original article loses its identity as such and is transformed into a new and different article of commerce having "a new name,character, or use" different from that of the original item.

Informed Compliance

Refers to softer mechanisms designed to place the burden of voluntary compliance on importers.

Formal Entry

Refers to the administrative process required to import goods into the customs territory of a country.

Binding Ruling

Represents the official position of customs with respect to the specific transaction for which it was issued.

Tariff-Shift Rule

States that the country of origin is the last country in which all "inputs" into the finished article underwent a defined change in tariff classification.

Rule of Relative Specificity

States that where an article could be classified under more than one heading, it must be classified under the one that most specifically- most narrowly- describes the article with the greatest degree of accuracy and certainty.

Enforced Compliance

The active investigation of customs violations and the prosecution of violators.

Tariff Law

The body of laws and regulations that determines the tariff or "dutiable" status of goods and the rate of duty.

Customs Law

The body of laws, including tariff law, that extends to other areas of regulatory control over goods and people as they cross international borders.

Country of Origin

The country from which an imported article is said to have originated according to specific legal rules, known as "rules of origin'.

Name, Character, or Use Test

The court's test in determining if a transformation has occurred. There must be a new and different article to emerge, a new and distinctive name must be added, and a new character and use must be used.

Dutiable Value

The customs value of goods entered into any country must be reported by the importer of record to national customs authorities at the time of entry.

Importing

The entering of goods into the customs territory of a country.

Liquidation

The final computation and assessment of the applicable duty on entered goods by customs.

Deemed Liquidation

Under this, the goods are dutied at the rate at accepted on the entry summary form.

Substitution Drawback

Usually deal with fungible goods or agricultural commodities.

Prior Disclosure

When an importer admits, to customs, that there may be a violation. This admission must be made before learning that it is being investigated.

Informal Entry

When an item of less than $2500 in value can enter a country. No surety bond is required and import duties must be paid immediately.