CBP Issues Final Rule for $2,500 Informal Entry Limit & Extending it to Textiles, Etc.
CBP issued a final rule to increase the informal entry limit from $2,000 to its maximum statutory limit of $2,500 due to inflation. CBP is also eliminating the formal entry requirement for certain textile and other articles valued over $250, as there are no longer absolute quotas and/or visa requirements for such goods. As a result, these textiles and other articles will also have a informal entry limit of $2,500. The rule is effective Jan. 7
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The final rule differs only slightly from the proposed rule. Among differences is a "technical conforming amendment to reflect a recent statutory amendment that increased the ad valorem Merchandise Processing Fee (MPF) from 0.21 percent to 0.3464 percent." Additional minor grammatical and editorial changes were made in this final rule, said CBP.
CBP Says Increasing Limit by $500 Will Save Trade About $13M in MPFs
By increasing the informal entry limit by $500, CBP believes the overall administrative burden on a number of importers and other entry filers will be reduced by expanding the availability of the simplified informal entry procedures.
CBP has also determined that increasing the informal entry limit to $2,500 will save the trade community about $13 million in MPF. CBP increased the MPF savings estimate from $11 million in the proposed rule. "Because the informal entry limit has not kept pace with inflation, some importers may have paid a higher MPF than would have been required if the informal entry limit had kept pace with inflation," said CBP. "Due to data limitations CBP is unable to determine the aggregate savings any particular firm will realize if this regulation is finalized. CBP estimates importers as a whole, however, will realize a benefit of approximately $13 million when this regulation is finalized."
CBP estimates that in FY 2011 there were about 852,000 formal entries between the value of $2,000 and $2,500. About 558,000 of those entries would have been affected by this rule because they were required to pay MPFs, it said.
Higher Informal Entry Limit also Applies to Certain Textiles, Other Products
CBP is amending 19 CFR 141, 143, and 148 to eliminate the language stating that formal entry is required for articles valued in excess of $250 that are classified in Sections VII, VIII, XI, XII; Chapter 94 of the Harmonized Tariff Schedule1. CBP is also removing paragraph (a) of 19 CFR 102.24 due to the elimination of visa programs for textile and apparel imports. As a result, these products will be subject to the higher informal entry limit of $2,500.
Other Editorial and Nomenclature Changes
In addition, CBP’s rule is amending the regulations by replacing $2,000 with $2,500 for informal entries, where it appears in 19 CFR parts 143, 10, 24, 123, 128, 141, 145, and 148. The rule also amends 19 CFR 143.21 to remove the citation for 19 CFR 141.51 and replacing it with 141.52.
The rule also makes non-substantive amendments to reflect nomenclature changes effected by the transfer of CBP to the Department of Homeland Security and other minor grammatical and editorial edits.
1Note that in 2009, CBP issued a memorandum changing several entry requirements for imported textile and apparel products. However, formal entry continued to be required, pursuant to 19 CFR 143.21(a), for shipments of articles valued in excess of $250 classified in HTS Sections VII, VIII, XI, and XII; Chapter 94; and Chapter 99, subchapters III and IV, which include tariff numbers (1) 3901.10.1000 through 4303.00.0000; (2) 5001.00.0000 through 6704.90.0000; (3) 9401.10.4000 through 9406.00.8090; and (4) 9903.02.21 through 9904.52.50.
This rule removes the formal entry only for shipments of articles valued in excess of $250 in HTS Sections VII, VIII, XI, and XII, and Chapter 94. Therefore, formal entry will still be required for such shipments of articles in HTS Chapter 99, subchapters II and IV. (See ITT's Online Archives 09061610 for summary.)
(See ITT's Online Archives 12120403 for news of CBP's submission of the final rule to OMB. See ITT's Online Archives 11102730 for initial summary announcing this proposed rule. See ITT's Online Archives 11100410 for summary of the CBP workgroup's proposal for simplified entry, entry summary, and financial processes.)
CBP contact - Elena Ryan (202) 863-6578
(FR Pub 12/06/12)