TYPES OF DRAWBACK

Unused Drawback

If you import merchandise and then export it in essentially the same condition you may be eligible for a refund of duties paid.

Example: A shipment of 500 widgets is imported from Japan. They are received by the U.S. consignee who examines them for quality and places them into inventory. A German company then orders 200 widgets, which are removed from the U.S. inventory and exported to the German customer. The 200 widgets that were exported are eligible for unused drawback.

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Manufacturing Drawback

If you import merchandise and that merchandise is significantly changed from its original state and a new and different product is exported, you may be eligible for a refund of duties paid.

Example: A shipment of 500 widgets is imported from Japan. They are received by the U.S. consignee who examines them for quality and places them into inventory. A German company orders 200 combines. Among the components used to make 1 combine are 2 widgets. In the manufacturing process the widgets lose their own identity and become part of the finished combine. The 200 combines are manufactured and exported to the German customer. The 400 widgets used to make the 200 combines that were exported are eligible for manufacturing drawback.

Retroactive Drawback Timeline