FedEx and UPS charged fees for collecting tariffs. Now, customers want that money back. - Business Insider

Importers and trade compliance professionals should be aware of a growing issue concerning fees charged by major carriers, specifically FedEx and UPS, for the collection of Section 301 tariffs on goods imported from China. These "ancillary fees" or "brokerage fees" were levied for the service of collecting tariffs that were imposed by the U.S. government. The core of the current dispute is that these fees were often not refunded to customers, even when the underlying Section 301 tariffs themselves were later waived, reduced, or refunded.

This situation primarily affects businesses and individuals who imported goods from China subject to the Section 301 tariffs, which were initially imposed by the Trump administration starting in 2018. Many importers sought and received refunds for these tariffs through various mechanisms, such as successful exclusion requests, protests, or other administrative processes with U.S. Customs and Border Protection (CBP). However, despite receiving refunds for the tariffs, customers are now finding that the separate fees charged by FedEx and UPS for the collection of those tariffs were retained by the carriers.

The fees in question were charged for the administrative service of processing and remitting the Section 301 tariffs. While the exact rates for these ancillary fees could vary, the Business Insider article highlights an example where a customer was charged a $16 fee for a $100 tariff. The crucial point is that these fees were distinct from the tariffs themselves. When the tariffs were subsequently deemed non-applicable or refunded to the importer, the carriers did not automatically refund their associated collection fees, leading to significant financial losses for affected businesses.

What Importers Should Do

Given this development, importers and trade compliance officers are strongly advised to take proactive steps:

• Review Past Invoices: Carefully examine invoices from FedEx and UPS for shipments originating from China during the period when Section 301 tariffs were in effect (starting in 2018). Look for line items labeled as "ancillary fees," "brokerage fees," "tariff collection fees," or similar charges.
• Cross-Reference with Tariff Refunds: Compare these identified fees with instances where your company received refunds or waivers for Section 301 tariffs. Identify cases where you paid a tariff collection fee but later received a refund for the tariff itself.
• Contact Carriers: Reach out to FedEx and UPS directly to inquire about a refund for these unreturned ancillary fees. Be prepared to provide documentation of both the fee payment and the subsequent tariff refund.
• Stay Informed: Be aware that customers are increasingly demanding these refunds, and the Business Insider article notes that "lawyers are getting involved," suggesting potential for collective action or legal recourse. Monitoring further developments in this area will be crucial.