Client

Global supplier, importer, exporter, and distributor of chemicals, minerals, and raw materials.

Challenge

An existing customer (Client 1) had substantial imports but minimal exports upon which to claim drawback.

Solution

Under the provisions in the Trade Facilitation and Trade Enforcement Act of 2015 (TFTEA), we now can match tariff codes on an 8-digit level for drawback purposes. Based on this law, using our drawback trading concept, we can match imports from Client 1 with exports from Client 2, even if they don’t have an existing commercial relationship.

Under TFTEA, the rules for matching imports to exports have changed from “Commercially Interchangeable,” a very high standard to meet, to interchangeability based upon classification under common tariff subheadings, which is a much easier test to complete.

We identified another customer (Client 2) who had excess exports, which, under the new TFTEA interchangeability rules, could be matched up with the excess imports of Client 1. We then analyzed each party’s excess imports and exports inventory to identify those that could qualify for drawbacks under an adequately structured arrangement.

We fully appreciate that importers and exporters guard their commercial transaction details zealously. Therefore, it is our practice to obtain NDAs that give us the necessary access but protect each party from the disclosure of their details to the other. Our NDAs only permit disclosure when a Customs inquiry requires it under pre-established rules and as vetted by our trade counsel.

Establishing a commercial relationship, which can be pre-existing or created, is necessary to make a drawback claim. Therefore, employing a drawback trading concept, we demonstrated the required commercial relationship between the import rich company (Client 1) and export rich company’s (Client 2) transactions so that we could file the drawback claims resulting from their combined transactions.

Results

JMR discovered over a million dollars in refunds that neither importer nor exporter had expected to realize. JMR is in a unique position as the only A-to-Z drawback provider able to facilitate this kind of trading scenario under TFTEA, giving customers access to drawback refunds that their transactions histories hadn’t identified.