Drawback has three main families under 19 USC 1313: manufacturing drawback, unused merchandise drawback, and rejected merchandise drawback. The first two get the attention, because they cover the common cases: goods re-exported after manufacture, and goods re-exported unused. The third covers the case nobody plans for: the goods arrived, and they are wrong.
Rejected merchandise drawback applies when imported merchandise does not conform to the order, is defective, or was shipped in error, and is then exported or destroyed. The goods have to be the same goods that were imported, in the same condition, and the exporter has to show that they were rejected for a reason that existed at import, not for a reason that arose after. A product that arrived defective qualifies. A product that the buyer changed their mind about does not.
The claim needs the same spine as every drawback claim: the import entry showing the duty paid by line, the export documentation showing the goods leaving, and the inventory records connecting the two. For rejected merchandise the connection matters more, because the goods have to be the exact ones that came in, and CBP will ask how you know.
That is why the notice of intent matters. Unused and rejected merchandise claims generally require a Notice of Intent to Export, which gives CBP the chance to examine the goods before they leave, unless the claimant has a waiver of prior notice. Exporting without the notice, or without a waiver, can kill a claim that was otherwise good. The drawback claim file lists the documents, and the notice is the one importers forget, because it has to be filed before the goods move, not after.
Rejected goods do not have to be shipped back. They can be destroyed under CBP supervision, and the drawback still applies, which matters when the return freight costs more than the goods are worth. The destruction has to be supervised, and the record has to show what was destroyed, when, and under whose watch. A warehouse that destroys defective goods on its own, without CBP supervision, has destroyed the claim along with the goods.
Check the duty layers before you file. The refund is 99 percent of the duties, taxes, and fees paid, but not every layer is refundable: antidumping and countervailing duties are excluded from drawback under the 2015 TFTEA modernization, and the 2025 Section 232 proclamations bar drawback on those duties. The 99 percent refund is the headline, and the eligible layers are the fine print. File the claim in ACE within five years of the import date, keep the records for three years after the claim is paid, and treat the rejected shipment as a claim from the day it arrives, not the day someone asks about the money.
Rejected merchandise drawback refunds 99 percent of duties on imported goods that do not conform to the order, are defective, or were shipped in error, and are then exported or destroyed under CBP supervision.
The import entry showing duty paid by line, export or destruction documentation, inventory records connecting the export to the import, and a Notice of Intent to Export unless waived. The goods must be the same ones that were imported.
Yes. Goods destroyed under CBP supervision qualify for drawback the same as exported goods. Destruction without CBP supervision does not qualify.
Antidumping and countervailing duties are excluded from drawback, and the 2025 Section 232 proclamations bar drawback on those duties. Check the eligible layers before filing.