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Goods manufactured in the U.S. that have been previously exported and are now returning require a formal declaration called American Goods Returned (AGR) also referred to as U.S. Made Goods Returned (USGR).
Common Mistake Made By Importers With U.S. Goods Returned
Do not assume that the return of goods to the United States will be without some difficulty. A common mistake that importers make when declaring U.S. goods is that they do not know where the products were manufactured. Just because the product was purchased in the United States it doesn't necessarily mean it was manufactured in the United States.
U.S. Goods Returning Are Usually Eligible For Duty-Free Status
All goods are subject to duty every time they enter the U.S. unless they are specifically identified as duty exempt. Did you know U.S. goods returning to the United States are usually eligible for duty-free treatment? The provision 9801.00.10 in the Harmonized Tariff Schedule allows U.S. made products to return to the U.S. without being subject to duty and the Merchandise Processing Fee. However, the provision stipulates the goods cannot be advanced in value or the condition of the goods improved while abroad.
Example 1: U.S. Manufactured Helicopter Sent To Canada For Repairs
For example, say you are the owner of a helicopter manufactured in the USA. The helicopter has electrical problems and you send it to a repair shop in Canada. When the helicopter returns the value of the repairs may be subject to duty.
Example 2: Canadian Company Purchases Goods From The U.S.
Another example would be goods purchased from the U.S. by a Canadian company. They received their shipment and the goods were refused by the buyer because they did not meet their product specifications. The goods can be returned to the U.S. duty free if the proper documentation can be supplied to U.S. customs.
Documentation Required For U.S. Goods Returning Duty Free
The most common proof is a Manufacturer's Affidavit. Like the name implies, this form is completed by the actual manufacturer of the goods. U.S. customs requires this for any shipments that are valued over $2500 and if the articles are not clearly marked with the name and address of the manufacturer.
The affidavit must:
- State that the goods are a product of the USA
- Be on the U.S. manufacturer's letterhead and
- Signed by an employee from the U.S. manufacturers facility that has the authority to sign on behalf of the company.
As supporting proof of U.S. Goods returning, U.S. Customs also requires:
- Foreign Shipper's Declaration and
- Declaration by Owner, Consignee or Agent
At some U.S. ports of entry, Customs will accept a NAFTA Certificate that is completed by the manufacturer.
Next time you get ready to ship U.S. goods remember it is not always as easy as it seems. Be sure to supply the proper paperwork to support your duty free return!
CBP Form 3311 Declaration For Free Entry Of Returned American Products
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About Author
Aimee Miller
LCB, CCS
US Trade Compliance Supervisor
Pacific Customs Brokers Inc.
Aimee Miller is the Trade Compliance Supervisor with Pacific Customs Brokers Inc. US operation, located in Blaine, Washington. She is a licensed US Customs Broker and a Certified Customs Specialist, with 19 years of operational and Trade Compliance experience in the trade and transportation industry.
I'm Aimee Miller, a Trade Compliance Supervisor with Pacific Customs Brokers Inc., based in Blaine, Washington. As a licensed U.S. Customs Broker and a Certified Customs Specialist with 19 years of operational and Trade Compliance experience, I've dealt extensively with the intricacies of international trade regulations and procedures. My expertise lies in understanding the complexities of U.S. customs and import/export processes.
Now, let's delve into the concepts discussed in the article regarding the American Goods Returned (AGR) or U.S. Made Goods Returned (USGR) declaration:
1. American Goods Returned (AGR) Declaration:
Goods manufactured in the U.S. that were exported and are returning require a formal declaration known as American Goods Returned (AGR) or U.S. Made Goods Returned (USGR). Importers often make a common mistake by assuming that goods purchased in the U.S. were necessarily manufactured there.
2. Duty-Free Status for U.S. Goods Returning:
Contrary to the general rule of goods being subject to duty upon entry to the U.S., U.S. goods returning usually qualify for duty-free treatment under provision 9801.00.10 in the Harmonized Tariff Schedule. However, this exemption comes with conditions: the goods must not have advanced in value or condition while abroad.
3. Examples Illustrating Duty Considerations:
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Example 1: Repairs in Canada: If a U.S.-manufactured helicopter is sent to Canada for repairs, the value of those repairs upon return may be subject to duty.
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Example 2: Goods Refused by Canadian Buyer: Goods purchased from the U.S. by a Canadian company, if refused and returned, can be duty-free with proper documentation.
4. Documentation Requirements for Duty-Free Return:
To ensure duty-free return, U.S. Customs requires specific documentation, including:
- Manufacturer's Affidavit: This form, completed by the actual manufacturer, states that the goods are a product of the USA and must be on the manufacturer's letterhead, signed by an authorized employee.
- Additional Supporting Proof: Foreign Shipper's Declaration, Declaration by Owner/Consignee/Agent, and in some cases, a NAFTA Certificate completed by the manufacturer.
5. CBP Form 3311 Declaration:
For free entry of returned American products, importers need to submit CBP Form 3311, providing the necessary details for customs clearance.
In conclusion, navigating the return of U.S. goods involves understanding and adhering to specific regulations, documentation requirements, and conditions for duty-free treatment, as outlined by U.S. Customs. Importers should ensure proper paperwork, including the Manufacturer's Affidavit, is in order to support duty-free returns.
