URGENT & IMPORTANT: Please review — New First Cost Reporting Requirements
Inserted below is the trade bulletin that was published last week regarding CBP’s new value requirements. Customs has finalized their own system enhancements to accommodate this new data field and now the trade is doing the same. Due to this, CBP has extended the final deadline to display this data in the entry summary until September 18th. However, the trade will still have to account for the valuation method on any entry made from August 20th forward once all programming is complete.
It is imperative that you contact one of our senior consultants at Metro Customs Brokers and/or Omnitrans Inc (listed below) to advise and reconfirm that:
- You are commencing/continuing to import to the USA
- You will be declaring a “First-Cost” value to US Customs
- Identify, as a general rule, if you utilize “First-Cost” on an entire shipment or portions of the shipment are declared at a higher value (i.e. sale price).
- Identify any valuation changes that you have made or will be making to your US Customs documents.
This information will allow us to determine and assist you with the best course of action to be taken for properly adhering to and remaining in compliance with the US Customs requirements of “First-Cost” declaration as noted below. We look forward in speaking with you to review the above and answer any questions or concerns that you may have.
Metro Customs Brokers, Inc. & Omnitrans Inc.
AUGUST 14, 2008 UPDATE: IMPORTERS TO BE REQUIRED TO REPORT USE OF FIRST SALE TO U.S. CUSTOMS AND BORDER PROTECTION (CBP)
Earlier this year, CBP proposed to adopt a new interpretation of the first sale rule, which determined the value of goods based on the last sale prior to bringing the shipment into the U.S. Last month, CBP announced that they will not move forward with this new interpretation and would not revisit the issue until January 2011.
CBP has now stated they will be publishing an interim rule shortly as the First Sale Rule information will be required by August 20th, 2008.
Under the recently enacted Food, Conservation, and Energy Act of 2008, also known as the Farm Bill, a new requirement was set forth requiring that the use of First Sale be reported. For one year, the U.S. International Trade Commission will report the aggregate transaction value of imported merchandise for which first sale is declared and the aggregate value of all merchandise imported into the U.S.
U.S. Customs and Border Protection (CBP) is currently working on programming changes to add a first sale declaration field to the CF 7501. If First Sale were not used, the box would remain blank.
Companies currently using the First Sale rule when determining transaction value should inform Metro Customs Brokers by declaring this on their commercial invoice. The trade anticipates that CBP will be reviewing first sale claims closely to ensure all the requirements of first sale are met.
We recommend that companies, who are considering using the First Sale rule or are presently using the First Sale rule, contact our regulatory compliance manager to discuss the process of evaluation to ensure that all requirements are in place.
Metro Customs Brokers will provide updates as more information becomes available. A copy of the Farm Bill, section 15422, page 1763 covering First Sale may be viewed by clicking on the following link.
First Sale Rule