U.S. Customs and Border Protection Reviewing Liquidated Damages Cases Issued for Late and Non-Payment of Duty

During discussions with U.S. Customs and Border Protection, officials noted that recent liquidated damages cases assessed for late or non-payment of duty may have been issued in error.

 According to CBP, a technical error arose in the agency’s internal computer system during the recent migration to the Automated Commercial Environment. This error caused CBP’s internal software to reflect inaccurate release dates that in some cases generated erroneous dates of entry and affected the duty payment deadline. Liquidated damages cases were issued automatically based upon these incorrect deadlines and, in some cases, the liquidated damages assessment was doubled when the broker petitioned for relief.

CBP has formed a working group to oversee this matter and correct the computer glitch. CBP has also directed field offices to cancel outstanding liquidated damages cases where appropriate and, if necessary, refund the amounts that were paid in connection with improperly issued claims. These cases will then be stricken from the importer’s history so as not to create a record of non-compliance. Going forward, field offices have been directed to carefully review suspected instances of late or non-payment of duties prior to issuing liquidated damages.

While Customs stated that it will try to remedy those cases it can identify, we encourage brokers and importers to be proactive in reviewing recent liquidated damages cases rather than relying on CBP’s own internal review of this matter. Open liquidated damages should be resolved as soon as possible to avoid further complications with sureties and future CBP enforcement action. We have also excerpted below an e-mail from CBP’s Los Angeles Field Office on how to proceed locally. We will update this post should additional ports offer similar guidance.

“As part of our ongoing effort to keep the Los Angeles Trade Community updated on ACE, we want to provide you with information concerning a technical issue with ACE cargo release that may cause incorrect release dates to be set. CBP Headquarters has determined this is a complex problem, involving both CBP and Trade system issues. CBP is working with the Trade to identify the cause to address the issue and find a workable solution.

As a result of this issue, liquidated damages may have been initiated in error due to incorrect release dates for late filing of entry summaries and late payments of Periodic Monthly Statements (PMS). The Office of Administration, Revenue Division initiates liquidated damages for PMS non-payments and late-payments. Port Entry Personnel initiates liquidated damages for Non-PMS late filing of entry summaries.

For liquidated damage cases that broker/filers believe may have been issued in error due to incorrect release dates, they may submit a written request for cancellation. We will also accept request to refund liquidated damages that may have already been paid for this same issue. The request should be submitted to the below CBP personnel with the case number, entry number, and proof of release.

• PMS Liquidated Damage Cases (Port Code 4111)– Send an email with the above information to Program Manager Delia Crawford at This e-mail address is being protected from spambots. You need JavaScript enabled to view it . The email subject line should read “Cancel PMS Liquidated Damages – ACE Cargo Release”

• Non-PMS Liquidated Damage Cases (Port Code 2704) – Send an email with the above information to Entry Branch Chief Anthony Turner at This e-mail address is being protected from spambots. You need JavaScript enabled to view it . The email subject line should read “Cancel Liquidated Damages – ACE Cargo Release”

Questions regarding the issue should be directed to Program Manager Delia Crawford at the email address above or at (562) 256-8771.”

Please feel free to contact Richard M. Wortman at (213) 452-0860 or Patrick J. Caulfield at (212) 973-7785 with any questions or comments.

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