Dive Brief:

• U.S. companies importing goods from China could be missing out on a large pool of tariff refunds, which C.H. Robinson estimates add up to about $980 million for its customers alone, the transportation firm announced this week.
• The clock is winding down on shippers' ability to get refunds on the Section 301 tariffs, with a Dec. 31 exclusion deadline approaching.
• Ben Bidwell, the director of U.S. customs for C.H. Robinson, said the process used by the United States Trade Representative for issuing exclusions has made it challenging for companies to track the ones for which they're eligible.

Dive Insight:

Many companies importing goods into the U.S. have fought to figure out ways to reduce tariff costs by leveraging foreign trade zones or challenging the legality of the tariffs. Last month, about 3,500 companies filed suit seeking tariff refunds, arguing that the List 3 tariffs were unlawfully imposed.

The refunds highlighted by C.H. Robinson are unrelated to this lawsuit, and are based on existing exclusions that companies aren't taking advantage of given the complicated process the government has provided, Bidwell said.

The tariff exclusions from the USTR were issued in two different ways. Some are known as "absolute exclusions," under which anything that entered the U.S. with that tariff number is excluded from duties.

"That was a slam dunk for customers," Bidwell said, noting that C.H. Robinson would send customers their absolute exclusions, and the process for getting the refund was pretty easy from that point. But most of the time it was a bit more complicated.

"The bulk of the exclusions that were issued, however, were product specific," he said.

Product-specific tariff exclusions mean that just subsets of a tariff code are excluded. The example Bidwell provided is a blue computer mouse could be excluded, but the rest of the colors could remain subject to duties.

"Those product-specific ones ... become much more complex," he said. "And we can tell customers that they have the potential to a certain refund. However, they would still need to go through and verify that their specific product that they were importing meets the definition of that exclusion."

The majority of the exclusions have been issued retroactively after a company filed an exclusion request. And keeping up with what's approved and if it will apply to another company can be time-consuming.

Bidwell said the USTR has received about 52,000 exclusion requests and has thus far granted about 13%. After a company's exclusion application is granted, other companies that have procured the same product are able to apply for refunds. C.H. Robinson has been working to notify customers when this is a possibility.

The process for keeping up with exclusions can involve manual data entry. C.H. Robinson has created a new portal to help customers keep up with the shifting trade environment where the latest trade advisories can be found.

"One of the things that we've consistently heard is, 'We tried to navigate this on our own, and it's incredibly complex,'" Bidwell said.

The deadline for exemptions has been extended in the past, but that's not expected to happen with the Dec. 31 date. "Companies who do not submit for a refund will miss the opportunity," Bidwell said.

"It's important to note importers can still retroactively apply for exclusions depending on how their entry was filed," he said.