USTR considers drawback future in free trade negotiations
The U.S. Trade Representative’s Trade Policy Staff Committee will consider duty drawback in upcoming free-trade agreement negotiations with other countries and economic regions.
Drawback is a refund of customs duties paid on imported materials that are either exported or used in the manufacture of exported articles. With appropriate documentation, an exporter can receive up to 99 percent of duties paid. It’s one of the oldest U.S. Customs regulations on the books.
Since the early 1990s, however, the ability to claim drawback in the United States has been squeezed. The 1993 North America Free Trade Agreement substantially reduced this privilege for U.S. companies shipping to Canada and Mexico.
The recent U.S./Chilean free-trade agreement called for a gradual phase-out of drawback for shipments between the countries. Other U.S. free trade agreement talks are expected to be modeled after the U.S./Chilean trade pact.
Drawback industry committees of the American Association of Exporters and Importers, National Customs Brokers and Forwarders Association of America, and the American Petroleum Institute, want USTR to uphold drawback provisions in future free trade agreements, such as Australia, Morocco, the Southern African Customs Union, an d the Free Trade Area of the Americas.
The USTR said it would take comments from the industry through July 30. For more information, contact Gloria Blue of the Trade Policy Staff Committee at (202) 395-3475.