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Drawback — Duty Refund Programs

Overview of manufacturing drawback, unused merchandise drawback, and rejected goods drawback.

19 USC 131319 CFR 190

Structured from CBP-designated exam references; confirm the editions approved for your exam sitting.

The textbook layer behind Study Map

From learning route to full explanation

This guide selects among direct-identification unused, manufacturing, substitution, and rejected-merchandise drawback before calculating a refund. It connects identification, manufacture, possession, same-subheading substitution, notice, export or destruction, the five-year framework, and the ordinary 99-percent limitation.

Study Map tells you what to learn and in what order; this page explains the rules, decision method, and boundaries. Reading completion is not proof of mastery.

1. Direct-Identification Unused Merchandise Drawback2. Manufacturing Drawback3. Substitution Drawback4. Rejected Merchandise Drawback

Textbook chapter 1

Direct-Identification Unused Merchandise Drawback

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Answer first

Prove that the exported or destroyed merchandise is the designated imported merchandise, remained unused for drawback purposes, met notice requirements, and stayed within the statutory period. Under 19 U.S.C. § 1313(j)(1), directly identified imported merchandise may support drawback when exported or destroyed under CBP supervision without being used in the United States and within five years after importation. Operations such as testing, cleaning, or repacking are not automatically disqualifying, but they must not amount to manufacture or production. The ordinary refund ceiling is 99% of eligible duties, taxes, and fees.

Rule breakdown

Controlling rule for Direct-Identification Unused Merchandise Drawback

19 U.S.C. § 1313(j)(1), (i), and (r) ↗

The result must be derived from the cited legal elements rather than from a label, commercial expectation, or memorized shortcut. Under 19 U.S.C. § 1313(j)(1), directly identified imported merchandise may support drawback when exported or destroyed under CBP supervision without being used in the United States and within five years after importation. Operations such as testing, cleaning, or repacking are not automatically disqualifying, but they must not amount to manufacture or production. The ordinary refund ceiling is 99% of eligible duties, taxes, and fees. Apply every stated condition to the documented facts and stop if an essential condition cannot be proved.

Evidence route for Direct-Identification Unused Merchandise Drawback

19 U.S.C. § 1313(j)(1), (i), and (r); 19 CFR §§ 190.2 and 190.31; 19 CFR §§ 190.35–190.37 ↗

Use the official source in the order required by the issue and record both the rule and the fact that satisfies it. The assigned lookup is: From § 190.2, list five allowed operations that do not by themselves make merchandise 'used.' Then locate the line where an operation becomes disqualifying and connect it to the prior-notice rule in § 190.35. Follow this source route: 19 U.S.C. § 1313(j)(1) → § 190.2 definition → § 190.31 eligibility → §§ 190.35–190.37 procedure. A technically accepted filing or a completed reading is not itself proof that the legal outcome is correct.

Decision path

  1. 1

    Set the gate for Direct-Identification Unused Merchandise Drawback

    Prove that the exported or destroyed merchandise is the designated imported merchandise, remained unused for drawback purposes, met notice requirements, and stayed within the statutory period. Identify the legally significant party, merchandise, event, date, value, status, and document before selecting a rule or performing a calculation.

  2. 2

    Verify 19 U.S.C. § 1313(j)(1), (i), and (r)

    Open 19 U.S.C. § 1313(j)(1), (i), and (r), complete the chapter lookup task, and preserve the exact subsection, table, form, or agency guide used. Follow 19 U.S.C. § 1313(j)(1) → § 190.2 definition → § 190.31 eligibility → §§ 190.35–190.37 procedure rather than jumping directly to a remembered result.

  3. 3

    Test the boundary of Direct-Identification Unused Merchandise Drawback

    Apply each controlling element to the documented facts, calculate only after eligibility is established, and compare the result with the worked example conclusion: $495 is the ordinary maximum on the stated eligible duty. Identity, nonuse, timing, export proof, notice, and claim completion must all be proved before payment. Record any unresolved fact instead of converting uncertainty into a pass or mastery claim.

Worked example

Scenario: An importer paid $20 duty on each of 100 identical devices. Twenty-five of the same imported devices were only inspected and repacked, then timely exported with the required identification and notice. What is the ordinary maximum direct-identification drawback on those 25 devices?

  1. 1.Trace the exported 25 devices to the designated import records and confirm that inspection and repacking did not become manufacture or production.
  2. 2.Calculate eligible duty attributable to those units: 25 × $20 = $500.
  3. 3.Apply the ordinary 99% ceiling: $500 × 0.99 = $495, subject to every procedural and fee-eligibility rule.
  4. 4.Boundary check: change one decisive fact identified by “From § 190.2, list five allowed operations that do not by themselves make merchandise 'used.' Then locate the line where an operation becomes disqualifying and connect it to the prior-notice rule in § 190.35.” and explain whether the result changes under 19 U.S.C. § 1313(j)(1), (i), and (r); 19 CFR §§ 190.2 and 190.31; 19 CFR §§ 190.35–190.37.

Conclusion: $495 is the ordinary maximum on the stated eligible duty. Identity, nonuse, timing, export proof, notice, and claim completion must all be proved before payment.

Common traps and corrections

× Assuming any domestic operation is 'use,' or assuming every listed operation can never become manufacture.

✓ The shortcut “Assuming any domestic operation is 'use,' or assuming every listed operation can never become manufacture.” skips a controlling distinction in Direct-Identification Unused Merchandise Drawback. Return to 19 U.S.C. § 1313(j)(1), (i), and (r), follow 19 U.S.C. § 1313(j)(1) → § 190.2 definition → § 190.31 eligibility → §§ 190.35–190.37 procedure, and test the decisive fact against this boundary: Under 19 U.S.C. § 1313(j)(1), directly identified imported merchandise may support drawback when exported or destroyed under CBP supervision without being used in the United States and within five years after importation. Operations such as testing, cleaning, or repacking are not automatically disqualifying, but they must not amount to manufacture or production. The ordinary refund ceiling is 99% of eligible duties, taxes, and fees. Do not infer eligibility, release, or mastery from the shortcut.

× Using inventory similarity instead of an authorized direct-identification method.

✓ The shortcut “Using inventory similarity instead of an authorized direct-identification method.” skips a controlling distinction in Direct-Identification Unused Merchandise Drawback. Return to 19 U.S.C. § 1313(j)(1), (i), and (r), follow 19 U.S.C. § 1313(j)(1) → § 190.2 definition → § 190.31 eligibility → §§ 190.35–190.37 procedure, and test the decisive fact against this boundary: Under 19 U.S.C. § 1313(j)(1), directly identified imported merchandise may support drawback when exported or destroyed under CBP supervision without being used in the United States and within five years after importation. Operations such as testing, cleaning, or repacking are not automatically disqualifying, but they must not amount to manufacture or production. The ordinary refund ceiling is 99% of eligible duties, taxes, and fees. Do not infer eligibility, release, or mastery from the shortcut.

× Exporting or destroying before providing notice when no waiver applies.

✓ The shortcut “Exporting or destroying before providing notice when no waiver applies.” skips a controlling distinction in Direct-Identification Unused Merchandise Drawback. Return to 19 U.S.C. § 1313(j)(1), (i), and (r), follow 19 U.S.C. § 1313(j)(1) → § 190.2 definition → § 190.31 eligibility → §§ 190.35–190.37 procedure, and test the decisive fact against this boundary: Under 19 U.S.C. § 1313(j)(1), directly identified imported merchandise may support drawback when exported or destroyed under CBP supervision without being used in the United States and within five years after importation. Operations such as testing, cleaning, or repacking are not automatically disqualifying, but they must not amount to manufacture or production. The ordinary refund ceiling is 99% of eligible duties, taxes, and fees. Do not infer eligibility, release, or mastery from the shortcut.

× Claiming 100% rather than applying the ordinary 99% ceiling.

✓ The shortcut “Claiming 100% rather than applying the ordinary 99% ceiling.” skips a controlling distinction in Direct-Identification Unused Merchandise Drawback. Return to 19 U.S.C. § 1313(j)(1), (i), and (r), follow 19 U.S.C. § 1313(j)(1) → § 190.2 definition → § 190.31 eligibility → §§ 190.35–190.37 procedure, and test the decisive fact against this boundary: Under 19 U.S.C. § 1313(j)(1), directly identified imported merchandise may support drawback when exported or destroyed under CBP supervision without being used in the United States and within five years after importation. Operations such as testing, cleaning, or repacking are not automatically disqualifying, but they must not amount to manufacture or production. The ordinary refund ceiling is 99% of eligible duties, taxes, and fees. Do not infer eligibility, release, or mastery from the shortcut.

Frequently asked questions

Which fact controls first for Direct-Identification Unused Merchandise Drawback?

Begin with the chapter objective and the legally controlling facts, not with the desired commercial result. Prove that the exported or destroyed merchandise is the designated imported merchandise, remained unused for drawback purposes, met notice requirements, and stayed within the statutory period. Then use 19 U.S.C. § 1313(j)(1), (i), and (r) and the remaining cited sources to test every required element before calculating or filing.

Where should I verify Direct-Identification Unused Merchandise Drawback for the exam and live work?

For the October 28, 2026 CBLE, use the designated exam source card and pinpoint 19 U.S.C. § 1313(j)(1), (i), and (r). For live work, separately verify the dated current source cards for this chapter as of the transaction date; a current statute, eCFR, HTSUS, recordation, or agency guide does not silently amend the exam edition.

Official sources and editions

Textbook chapter 2

Manufacturing Drawback

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Answer first

Connect designated merchandise to a qualifying manufacturing operation, the exported article, an approved ruling, and a supportable allocation of eligible duties. Direct-identification manufacturing drawback under § 1313(a) requires imported duty-paid merchandise to be used in manufacture or production and the resulting article to be exported or destroyed within the statutory period. The manufacturer must operate under an acknowledged general ruling or an approved specific ruling, follow its method, and support quantities, waste, multiple products, and allocation with records.

Rule breakdown

Controlling rule for Manufacturing Drawback

19 U.S.C. § 1313(a), (i), and (r) ↗

The result must be derived from the cited legal elements rather than from a label, commercial expectation, or memorized shortcut. Direct-identification manufacturing drawback under § 1313(a) requires imported duty-paid merchandise to be used in manufacture or production and the resulting article to be exported or destroyed within the statutory period. The manufacturer must operate under an acknowledged general ruling or an approved specific ruling, follow its method, and support quantities, waste, multiple products, and allocation with records. Apply every stated condition to the documented facts and stop if an essential condition cannot be proved.

Evidence route for Manufacturing Drawback

19 U.S.C. § 1313(a), (i), and (r); 19 CFR §§ 190.7–190.8; 19 CFR § 190.21 ↗

Use the official source in the order required by the issue and record both the rule and the fact that satisfies it. The assigned lookup is: Choose one general manufacturing drawback ruling in Part 190 Appendix A. Extract the authorized process, imported material, exported article, 'used in' or 'appearing in' basis, waste treatment, and minimum records into a production-flow diagram. Follow this source route: § 1313(a) → §§ 190.7–190.8 ruling → § 190.21 eligibility and allocation → Appendix A or approved specific ruling. A technically accepted filing or a completed reading is not itself proof that the legal outcome is correct.

Decision path

  1. 1

    Set the gate for Manufacturing Drawback

    Connect designated merchandise to a qualifying manufacturing operation, the exported article, an approved ruling, and a supportable allocation of eligible duties. Identify the legally significant party, merchandise, event, date, value, status, and document before selecting a rule or performing a calculation.

  2. 2

    Verify 19 U.S.C. § 1313(a), (i), and (r)

    Open 19 U.S.C. § 1313(a), (i), and (r), complete the chapter lookup task, and preserve the exact subsection, table, form, or agency guide used. Follow § 1313(a) → §§ 190.7–190.8 ruling → § 190.21 eligibility and allocation → Appendix A or approved specific ruling rather than jumping directly to a remembered result.

  3. 3

    Test the boundary of Manufacturing Drawback

    Apply each controlling element to the documented facts, calculate only after eligibility is established, and compare the result with the worked example conclusion: $1,980 on the stated simplified facts. Recovered waste, multiple products, a different ruling basis, or incomplete production records can change the result. Record any unresolved fact instead of converting uncertainty into a pass or mastery claim.

Worked example

Scenario: Under an applicable approved ruling and with no multiple products or recovered waste, a manufacturer pays $5,000 eligible duty on 1,000 kg of directly identified imported resin. Records prove that 400 kg appears in timely exported articles. What is the ordinary maximum drawback attributable to that resin?

  1. 1.Confirm that the operation and 'appearing in' basis follow the ruling and that the resin is directly identified.
  2. 2.Allocate eligible duty to 400 of 1,000 kg: $5,000 × 40% = $2,000.
  3. 3.Apply the ordinary 99% ceiling: $2,000 × 0.99 = $1,980.
  4. 4.Boundary check: change one decisive fact identified by “Choose one general manufacturing drawback ruling in Part 190 Appendix A. Extract the authorized process, imported material, exported article, 'used in' or 'appearing in' basis, waste treatment, and minimum records into a production-flow diagram.” and explain whether the result changes under 19 U.S.C. § 1313(a), (i), and (r); 19 CFR §§ 190.7–190.8; 19 CFR § 190.21.

Conclusion: $1,980 on the stated simplified facts. Recovered waste, multiple products, a different ruling basis, or incomplete production records can change the result.

Common traps and corrections

× Filing under a manufacturing method that is not covered by the claimant's general or specific ruling.

✓ The shortcut “Filing under a manufacturing method that is not covered by the claimant's general or specific ruling.” skips a controlling distinction in Manufacturing Drawback. Return to 19 U.S.C. § 1313(a), (i), and (r), follow § 1313(a) → §§ 190.7–190.8 ruling → § 190.21 eligibility and allocation → Appendix A or approved specific ruling, and test the decisive fact against this boundary: Direct-identification manufacturing drawback under § 1313(a) requires imported duty-paid merchandise to be used in manufacture or production and the resulting article to be exported or destroyed within the statutory period. The manufacturer must operate under an acknowledged general ruling or an approved specific ruling, follow its method, and support quantities, waste, multiple products, and allocation with records. Do not infer eligibility, release, or mastery from the shortcut.

× Confusing an ordinary operation on unused merchandise with manufacture or production.

✓ The shortcut “Confusing an ordinary operation on unused merchandise with manufacture or production.” skips a controlling distinction in Manufacturing Drawback. Return to 19 U.S.C. § 1313(a), (i), and (r), follow § 1313(a) → §§ 190.7–190.8 ruling → § 190.21 eligibility and allocation → Appendix A or approved specific ruling, and test the decisive fact against this boundary: Direct-identification manufacturing drawback under § 1313(a) requires imported duty-paid merchandise to be used in manufacture or production and the resulting article to be exported or destroyed within the statutory period. The manufacturer must operate under an acknowledged general ruling or an approved specific ruling, follow its method, and support quantities, waste, multiple products, and allocation with records. Do not infer eligibility, release, or mastery from the shortcut.

× Ignoring recovered waste or relative-value allocation when multiple products result.

✓ The shortcut “Ignoring recovered waste or relative-value allocation when multiple products result.” skips a controlling distinction in Manufacturing Drawback. Return to 19 U.S.C. § 1313(a), (i), and (r), follow § 1313(a) → §§ 190.7–190.8 ruling → § 190.21 eligibility and allocation → Appendix A or approved specific ruling, and test the decisive fact against this boundary: Direct-identification manufacturing drawback under § 1313(a) requires imported duty-paid merchandise to be used in manufacture or production and the resulting article to be exported or destroyed within the statutory period. The manufacturer must operate under an acknowledged general ruling or an approved specific ruling, follow its method, and support quantities, waste, multiple products, and allocation with records. Do not infer eligibility, release, or mastery from the shortcut.

× Claiming duties on all input when records support only the quantity used in or appearing in exported articles.

✓ The shortcut “Claiming duties on all input when records support only the quantity used in or appearing in exported articles.” skips a controlling distinction in Manufacturing Drawback. Return to 19 U.S.C. § 1313(a), (i), and (r), follow § 1313(a) → §§ 190.7–190.8 ruling → § 190.21 eligibility and allocation → Appendix A or approved specific ruling, and test the decisive fact against this boundary: Direct-identification manufacturing drawback under § 1313(a) requires imported duty-paid merchandise to be used in manufacture or production and the resulting article to be exported or destroyed within the statutory period. The manufacturer must operate under an acknowledged general ruling or an approved specific ruling, follow its method, and support quantities, waste, multiple products, and allocation with records. Do not infer eligibility, release, or mastery from the shortcut.

Frequently asked questions

Which fact controls first for Manufacturing Drawback?

Begin with the chapter objective and the legally controlling facts, not with the desired commercial result. Connect designated merchandise to a qualifying manufacturing operation, the exported article, an approved ruling, and a supportable allocation of eligible duties. Then use 19 U.S.C. § 1313(a), (i), and (r) and the remaining cited sources to test every required element before calculating or filing.

Where should I verify Manufacturing Drawback for the exam and live work?

For the October 28, 2026 CBLE, use the designated exam source card and pinpoint 19 U.S.C. § 1313(a), (i), and (r). For live work, separately verify the dated current source cards for this chapter as of the transaction date; a current statute, eCFR, HTSUS, recordation, or agency guide does not silently amend the exam edition.

Official sources and editions

Textbook chapter 3

Substitution Drawback

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Answer first

Modernized unused-merchandise substitution is generally tested by the eligible same 8-digit HTSUS subheading, including the special rule when the description begins with ‘other’; commercial interchangeability is not the general §1313(j)(2) standard. For substitution unused-merchandise drawback under § 1313(j)(2), the designated import and substituted export generally must share the same eligible 8-digit HTSUS subheading, with special treatment when the subheading description begins with 'other.' The substituted merchandise must be unused and in the claimant's possession before export or destruction. Refund is ordinarily 99% of the lesser eligible duty measure—not automatically 99% of the designated import duties.

Rule breakdown

Controlling rule for Substitution Drawback

19 U.S.C. § 1313(j)(2) ↗

The result must be derived from the cited legal elements rather than from a label, commercial expectation, or memorized shortcut. For substitution unused-merchandise drawback under § 1313(j)(2), the designated import and substituted export generally must share the same eligible 8-digit HTSUS subheading, with special treatment when the subheading description begins with 'other.' The substituted merchandise must be unused and in the claimant's possession before export or destruction. Refund is ordinarily 99% of the lesser eligible duty measure—not automatically 99% of the designated import duties. Apply every stated condition to the documented facts and stop if an essential condition cannot be proved.

Evidence route for Substitution Drawback

19 U.S.C. § 1313(j)(2); 19 CFR §§ 190.2 and 190.32; 19 CFR § 190.51 ↗

Use the official source in the order required by the issue and record both the rule and the fact that satisfies it. The assigned lookup is: Build a substitution screen with six rows: 8-digit match, 'other' exception, Schedule B alternative, unused status, possession before export, and lesser-of calculation. Test it against one current HTSUS subheading you select. Follow this source route: § 1313(j)(2) → § 190.2 definitions → § 190.32 substitution screen → § 190.51 calculation. A technically accepted filing or a completed reading is not itself proof that the legal outcome is correct.

Decision path

  1. 1

    Set the gate for Substitution Drawback

    Apply the correct substitution standard, possession and timing rules, and the lesser-of refund limitation without pretending the exported merchandise is the imported merchandise. Identify the legally significant party, merchandise, event, date, value, status, and document before selecting a rule or performing a calculation.

  2. 2

    Verify 19 U.S.C. § 1313(j)(2)

    Open 19 U.S.C. § 1313(j)(2), complete the chapter lookup task, and preserve the exact subsection, table, form, or agency guide used. Follow § 1313(j)(2) → § 190.2 definitions → § 190.32 substitution screen → § 190.51 calculation rather than jumping directly to a remembered result.

  3. 3

    Test the boundary of Substitution Drawback

    Apply each controlling element to the documented facts, calculate only after eligibility is established, and compare the result with the worked example conclusion: $5,940, not $7,920. The substituted export's lower hypothetical duty measure limits the claim on these facts. Record any unresolved fact instead of converting uncertainty into a pass or mastery claim.

Worked example

Scenario: Assume an imported lot and an exported domestic lot share the same eligible 8-digit subheading that does not begin with 'other.' The unused exported lot was in the claimant's possession before export. Eligible duties paid on the designated imports were $8,000, but duties that would apply to the exported lot if imported are $6,000. What is the ordinary ceiling?

  1. 1.Confirm classification, unused status, possession, sequence, quantity, and certification before calculating.
  2. 2.Apply the lesser-of rule: the lower eligible duty measure is $6,000.
  3. 3.Apply 99%: $6,000 × 0.99 = $5,940.
  4. 4.Boundary check: change one decisive fact identified by “Build a substitution screen with six rows: 8-digit match, 'other' exception, Schedule B alternative, unused status, possession before export, and lesser-of calculation. Test it against one current HTSUS subheading you select.” and explain whether the result changes under 19 U.S.C. § 1313(j)(2); 19 CFR §§ 190.2 and 190.32; 19 CFR § 190.51.

Conclusion: $5,940, not $7,920. The substituted export's lower hypothetical duty measure limits the claim on these facts.

Common traps and corrections

× Treating commercial interchangeability alone as the general modernized unused-substitution test.

✓ The shortcut “Treating commercial interchangeability alone as the general modernized unused-substitution test.” skips a controlling distinction in Substitution Drawback. Return to 19 U.S.C. § 1313(j)(2), follow § 1313(j)(2) → § 190.2 definitions → § 190.32 substitution screen → § 190.51 calculation, and test the decisive fact against this boundary: Modernized unused-merchandise substitution is generally tested by the eligible same 8-digit HTSUS subheading, including the special rule when the description begins with ‘other’; commercial interchangeability is not the general §1313(j)(2) standard. Do not infer eligibility, release, or mastery from the shortcut.

× Stopping at an 8-digit match when the subheading description begins with 'other.'

✓ The shortcut “Stopping at an 8-digit match when the subheading description begins with 'other.'” skips a controlling distinction in Substitution Drawback. Return to 19 U.S.C. § 1313(j)(2), follow § 1313(j)(2) → § 190.2 definitions → § 190.32 substitution screen → § 190.51 calculation, and test the decisive fact against this boundary: Modernized unused-merchandise substitution is generally tested by the eligible same 8-digit HTSUS subheading, including the special rule when the description begins with ‘other’; commercial interchangeability is not the general §1313(j)(2) standard. Do not infer eligibility, release, or mastery from the shortcut.

× Ignoring possession before export or destruction.

✓ The shortcut “Ignoring possession before export or destruction.” skips a controlling distinction in Substitution Drawback. Return to 19 U.S.C. § 1313(j)(2), follow § 1313(j)(2) → § 190.2 definitions → § 190.32 substitution screen → § 190.51 calculation, and test the decisive fact against this boundary: Modernized unused-merchandise substitution is generally tested by the eligible same 8-digit HTSUS subheading, including the special rule when the description begins with ‘other’; commercial interchangeability is not the general §1313(j)(2) standard. Do not infer eligibility, release, or mastery from the shortcut.

× Calculating 99% of the higher duty measure instead of applying the lesser-of limitation.

✓ The shortcut “Calculating 99% of the higher duty measure instead of applying the lesser-of limitation.” skips a controlling distinction in Substitution Drawback. Return to 19 U.S.C. § 1313(j)(2), follow § 1313(j)(2) → § 190.2 definitions → § 190.32 substitution screen → § 190.51 calculation, and test the decisive fact against this boundary: Modernized unused-merchandise substitution is generally tested by the eligible same 8-digit HTSUS subheading, including the special rule when the description begins with ‘other’; commercial interchangeability is not the general §1313(j)(2) standard. Do not infer eligibility, release, or mastery from the shortcut.

Frequently asked questions

Which fact controls first for Substitution Drawback?

Begin with the chapter objective and the legally controlling facts, not with the desired commercial result. Apply the correct substitution standard, possession and timing rules, and the lesser-of refund limitation without pretending the exported merchandise is the imported merchandise. Then use 19 U.S.C. § 1313(j)(2) and the remaining cited sources to test every required element before calculating or filing.

Where should I verify Substitution Drawback for the exam and live work?

For the October 28, 2026 CBLE, use the designated exam source card and pinpoint 19 U.S.C. § 1313(j)(2). For live work, separately verify the dated current source cards for this chapter as of the transaction date; a current statute, eCFR, HTSUS, recordation, or agency guide does not silently amend the exam edition.

Official sources and editions

Textbook chapter 4

Rejected Merchandise Drawback

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Answer first

Match the facts to a statutory rejected-merchandise ground and preserve examination, notice, export or destruction, and documentary proof. Section 1313(c) covers duty-paid merchandise exported or destroyed under CBP supervision within five years when it failed to conform to sample or specifications, was shipped without the consignee's consent, was defective at importation, or meets the statutory retail-return ground. The claimant must identify the correct ground and give CBP the required opportunity to examine unless a valid waiver applies.

Rule breakdown

Controlling rule for Rejected Merchandise Drawback

19 U.S.C. § 1313(c) ↗

The result must be derived from the cited legal elements rather than from a label, commercial expectation, or memorized shortcut. Section 1313(c) covers duty-paid merchandise exported or destroyed under CBP supervision within five years when it failed to conform to sample or specifications, was shipped without the consignee's consent, was defective at importation, or meets the statutory retail-return ground. The claimant must identify the correct ground and give CBP the required opportunity to examine unless a valid waiver applies. Apply every stated condition to the documented facts and stop if an essential condition cannot be proved.

Evidence route for Rejected Merchandise Drawback

19 U.S.C. § 1313(c); 19 CFR §§ 190.41–190.42; 19 CFR §§ 190.91–190.92 ↗

Use the official source in the order required by the issue and record both the rule and the fact that satisfies it. The assigned lookup is: Create a four-path rejected-merchandise checklist from § 190.41. For each path, write the fact that must exist, the records that would prove it, and whether the same facts might instead support unused-merchandise drawback under § 190.43. Follow this source route: § 1313(c) statutory ground → § 190.41 path → § 190.42 timing and notice → §§ 190.91–190.92 approvals. A technically accepted filing or a completed reading is not itself proof that the legal outcome is correct.

Decision path

  1. 1

    Set the gate for Rejected Merchandise Drawback

    Match the facts to a statutory rejected-merchandise ground and preserve examination, notice, export or destruction, and documentary proof. Identify the legally significant party, merchandise, event, date, value, status, and document before selecting a rule or performing a calculation.

  2. 2

    Verify 19 U.S.C. § 1313(c)

    Open 19 U.S.C. § 1313(c), complete the chapter lookup task, and preserve the exact subsection, table, form, or agency guide used. Follow § 1313(c) statutory ground → § 190.41 path → § 190.42 timing and notice → §§ 190.91–190.92 approvals rather than jumping directly to a remembered result.

  3. 3

    Test the boundary of Rejected Merchandise Drawback

    Apply each controlling element to the documented facts, calculate only after eligibility is established, and compare the result with the worked example conclusion: $495 on the stated eligible duties. The defect-at-import evidence and compliance with notice and export procedures are essential to that result. Record any unresolved fact instead of converting uncertainty into a pass or mastery claim.

Worked example

Scenario: Ten imported pumps were proven defective at importation. Duty was $50 per pump. They were timely exported after proper notice and examination opportunity. Assuming all other requirements are met, what is the ordinary maximum drawback?

  1. 1.Match the evidence to the 'defective as of the time of importation' ground rather than relying on a later customer complaint alone.
  2. 2.Calculate eligible duties: 10 × $50 = $500.
  3. 3.Apply the ordinary 99% ceiling: $500 × 0.99 = $495.
  4. 4.Boundary check: change one decisive fact identified by “Create a four-path rejected-merchandise checklist from § 190.41. For each path, write the fact that must exist, the records that would prove it, and whether the same facts might instead support unused-merchandise drawback under § 190.43.” and explain whether the result changes under 19 U.S.C. § 1313(c); 19 CFR §§ 190.41–190.42; 19 CFR §§ 190.91–190.92.

Conclusion: $495 on the stated eligible duties. The defect-at-import evidence and compliance with notice and export procedures are essential to that result.

Common traps and corrections

× Using a post-import failure as proof that the defect necessarily existed at importation.

✓ The shortcut “Using a post-import failure as proof that the defect necessarily existed at importation.” skips a controlling distinction in Rejected Merchandise Drawback. Return to 19 U.S.C. § 1313(c), follow § 1313(c) statutory ground → § 190.41 path → § 190.42 timing and notice → §§ 190.91–190.92 approvals, and test the decisive fact against this boundary: Section 1313(c) covers duty-paid merchandise exported or destroyed under CBP supervision within five years when it failed to conform to sample or specifications, was shipped without the consignee's consent, was defective at importation, or meets the statutory retail-return ground. The claimant must identify the correct ground and give CBP the required opportunity to examine unless a valid waiver applies. Do not infer eligibility, release, or mastery from the shortcut.

× Combining different statutory grounds without proving every element of any one ground.

✓ The shortcut “Combining different statutory grounds without proving every element of any one ground.” skips a controlling distinction in Rejected Merchandise Drawback. Return to 19 U.S.C. § 1313(c), follow § 1313(c) statutory ground → § 190.41 path → § 190.42 timing and notice → §§ 190.91–190.92 approvals, and test the decisive fact against this boundary: Section 1313(c) covers duty-paid merchandise exported or destroyed under CBP supervision within five years when it failed to conform to sample or specifications, was shipped without the consignee's consent, was defective at importation, or meets the statutory retail-return ground. The claimant must identify the correct ground and give CBP the required opportunity to examine unless a valid waiver applies. Do not infer eligibility, release, or mastery from the shortcut.

× Exporting rejected goods before CBP's examination opportunity when no waiver applies.

✓ The shortcut “Exporting rejected goods before CBP's examination opportunity when no waiver applies.” skips a controlling distinction in Rejected Merchandise Drawback. Return to 19 U.S.C. § 1313(c), follow § 1313(c) statutory ground → § 190.41 path → § 190.42 timing and notice → §§ 190.91–190.92 approvals, and test the decisive fact against this boundary: Section 1313(c) covers duty-paid merchandise exported or destroyed under CBP supervision within five years when it failed to conform to sample or specifications, was shipped without the consignee's consent, was defective at importation, or meets the statutory retail-return ground. The claimant must identify the correct ground and give CBP the required opportunity to examine unless a valid waiver applies. Do not infer eligibility, release, or mastery from the shortcut.

× Assuming rejected merchandise can never qualify under an alternative unused-merchandise path.

✓ The shortcut “Assuming rejected merchandise can never qualify under an alternative unused-merchandise path.” skips a controlling distinction in Rejected Merchandise Drawback. Return to 19 U.S.C. § 1313(c), follow § 1313(c) statutory ground → § 190.41 path → § 190.42 timing and notice → §§ 190.91–190.92 approvals, and test the decisive fact against this boundary: Section 1313(c) covers duty-paid merchandise exported or destroyed under CBP supervision within five years when it failed to conform to sample or specifications, was shipped without the consignee's consent, was defective at importation, or meets the statutory retail-return ground. The claimant must identify the correct ground and give CBP the required opportunity to examine unless a valid waiver applies. Do not infer eligibility, release, or mastery from the shortcut.

Frequently asked questions

Which fact controls first for Rejected Merchandise Drawback?

Begin with the chapter objective and the legally controlling facts, not with the desired commercial result. Match the facts to a statutory rejected-merchandise ground and preserve examination, notice, export or destruction, and documentary proof. Then use 19 U.S.C. § 1313(c) and the remaining cited sources to test every required element before calculating or filing.

Where should I verify Rejected Merchandise Drawback for the exam and live work?

For the October 28, 2026 CBLE, use the designated exam source card and pinpoint 19 U.S.C. § 1313(c). For live work, separately verify the dated current source cards for this chapter as of the transaction date; a current statute, eCFR, HTSUS, recordation, or agency guide does not silently amend the exam edition.

Official sources and editions

Key Terms

Drawback|退税
Manufacturing Drawback|加工退税
Unused Merchandise|未使用商品
Substitution Drawback|替代退税
Accelerated Payment|加速支付

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Back to Knowledge BaseUpdated 2026-08-19