Designated merchandise means either eligible imported duty-paid merchandise or drawback products selected by the drawback claimant as the basis for a drawback claim under substitution manufacturing drawback or substitution unused merchandise drawback, as applicable, or qualified articles selected by the claimant as the basis for drawback under substitution of finished petroleum derivatives drawback.
Direct Identification Drawback
Direct identification drawback means drawback authorized either under direct identification manufacturing drawback on imported merchandise used to manufacture or produce an article which is either exported or destroyed, or under direct identification unused merchandise drawback on imported merchandise exported, or destroyed under Customs supervision, without having been used in the United States. Merchandise or articles may be identified for purposes of direct identification drawback by use of the accounting methods provided for in the Customs Regulations.
Drawback is a refund of duty paid on imported merchandise that is linked to an exportation (or destruction) of an article. In the U.S., drawback dates back practically to the dawn of the Republic. Drawback in the U.S. has changed greatly since its initial enactment, in section 3 of the second Act of Congress, the Act of July 4, 1789. That first drawback law provided for a drawback of 99% of duties paid on merchandise (except distilled spirits) if exported within a year after duty was paid or security given for duty. Changes, or adjustments, continue to be made to the drawback law, making it ever more complicated. There are three categories of drawback: manufacturing drawback, unused merchandise drawback, and rejected merchandise drawback. Within each category, there are variations such as the ability to substitute the imported article, and specific time limits to manufacture or export articles.
Drawback claim means the drawback entry and related documents required by regulation which together constitute the request for drawback payment.
Drawback entry means the document containing a description of, and other required information concerning, the exported or destroyed article on which drawback is claimed. Drawback entries are filed on Customs Form 7551.
Drawback products are finished or partially finished products manufactured or produced in the U.S. under drawback procedures. In addition to being exported or destroyed to qualify for drawback, drawback products may be used in further manufacture or production of other drawback products under drawback procedures. In the latter instance, drawback products may be designated as the basis for drawback or be deemed to be the substituted merchandise. If a drawback product is designated as the basis for drawback in a further manufacture or production, a separate 3-year period for use in manufacture or production of the drawback product and other substituted merchandise is commenced.
Exportation means the severance of goods from the mass of goods belonging to this country, with the intention of uniting them with the mass of goods belonging to some foreign country. An exportation may be deemed to have occurred when goods subject to drawback are admitted into a foreign trade zone in zone-restricted status, or are laden upon qualifying aircraft or vessels as aircraft or vessel supplies.
Exporter means that person who, as the principal party in interest in the export transaction, has the power and responsibility for determining and controlling the sending of the items out of the United States. In the case of “deemed exportations” (e.g., when goods subject to drawback are admitted into a foreign trade zone in zone-restricted status, or are laden upon qualifying aircraft or vessels as aircraft or vessel supplies), the exporter means that person who, as the principal party in interest in the transaction deemed to be an exportation, has the power and responsibility for determining and controlling the transaction (in the case of aircraft or vessel supplies, the party who has the power and responsibility for lading the vessel supplies on the qualifying aircraft or vessel).
Fungible Merchandise or Articles
Fungible merchandise or articles means merchandise or articles which for commercial purposes are identical and interchangeable in all situations.