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USMCA: MPF Not Refundable

As many of our clients know, on July 1st the US-Mexico-Canada Agreement (USMCA) will replace the North American Free Trade Agreement (NAFTA).  However, what you may not know is that there has been a major change to the post-importation preference claim rules.  Under NAFTA, if a preferential duty treatment claim was not made at the time of entry and duty was paid, a refund claim could be filed for a full refund of duty and Merchandise Processing Fee (MPF).

Under the USMCA, a refund claim can still be filed after importation. However, U.S. Customs and Border Protection (CBP) will only refund the duty, not the MPF.  MPF is assessed at a rate of .3464% with a minimum of $26.79 USD and a maximum of $519.76 USD for formal entries.  Therefore, if your USMCA certificate is not provided to your broker prior to shipping or with your shipment documentation, your company will run the risk not receiving a full refund of the monies paid.

A bill was introduced to Congress on June 3rd to change this policy, but it will most likely not be passed in time for the July 1st deadline.

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COVID-19 is a global challenge. Keeping our supply chains moving is important for maintaining the health and wellbeing of citizens and businesses. While the Canada - U.S. border is now closed to non-essential traffic, it is still open for trade and commerce. We are committed to doing our part for global supply chains.

We are protecting the health and safety of our employees. They are working from home, except for critical functions that require certain equipment or managing paper/courier flow. In those cases we are following social distancing guidelines.

We are open and available to assist you, and key players in your supply chains. Our dedicated staff are available 24/7 and our brokerage and logistics experts are available to help you make adjustments to your supply chain, if necessary.

We encourage you to check out the government programs available to families, businesses, exporters and importers. And, while respecting the need for social distancing we encourage everyone, including our staff, to reach out and remain connected to family, friends, colleagues and customers.

Stay safe.

Peter Willson
Chairman & CEO
Willson International

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