Refund of excess duties |
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A provision that allows to recover customs duties paid for originating goods at the time of import.
This provision usually relates to situations when a good qualifies for preferential tariff treatment at the time of import but a proof of origin is not available. Many agreements allow for the proof of origin to be issued retrospectively and customs duties to be refunded.
The application of this provision will also rely on the local customs legislation. Some customs authorities require the importer to provide an explanation of why the proof of origin was not available at the time of import and limit the ability to claim back duties to ‘exceptional’ circumstances.
Depending on the local customs legislation there are a number of reasons that would allow an importer to claim back paid customs duties. For example, if the importer provided an incorrect HS code at the time of import and can subsequently demonstrate that a different commodity code with a lower preferential rate should have been used, it may be possible to retrospectively change the import declaration and claim the overpaid duty if a proof of origin is provided.
Example:
At the time of import an origin certificate is not available to support the preferential origin claim as the exporter was not able to obtain the certificate on time. This can be due to not submitting the request on time or a number of other reasons. The importer pays the full rate of customs duties at the time of import and awaits the certificate of origin from the exporter. Once a retrospective certificate of origin is issued, the importer can claim back the overpaid customs duties. As this requires the importer to submit additional paperwork, it is not used as a standard procedure.
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