Importers May File Protests to Wait Out Official CBP Section 232 Metal Content Guidance, Lawyer Says
Importers may consider filing protests on entries subject to Section 232 steel and aluminum tariffs that are rate advanced under a new policy interpretation being put out by the base metals Center of Excellence and Expertise, customs lawyer Larry Friedman said in a blog post Dec. 15.
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The recent policy, which says overhead and processing costs for steel and aluminum inputs aren’t considered non-steel or non-aluminum content for Section 232 purposes (see 2512110025 and 2512120049), appears to contradict official guidance on CBP’s website, and it’s unclear whether “represents a final or even official policy decision of CBP Headquarters,” Friedman said. “To be clear, this may turn out to be the policy CBP adopts, but we do not know that to be true.”
The Section 232 tariff FAQ -- last updated July 31 -- says steel or aluminum content should be valued “based on the invoice paid by the buyer of the steel/aluminum content to, or for the benefit of the seller of the steel/aluminum content.” Informal base metals CEE guidance sent out over the last few months has said the “current position” is that means “what the importer paid for the steel/aluminum content of the finished article.”
However, according to Friedman, “the use of ‘for the steel/aluminum content’ in this FAQ appears to differentiate the purchase of the steel/aluminum content from the purchase of the finished imported good. The invoice paid by the buyer of the steel/aluminum content appears to refer to the purchase of the metal content by the manufacturer of the imported good.”
That more expansive interpretation would “make sense” because the only documentation required for Section 232 metal content would be the invoices for the metals from the supplier, rather than “potentially multiple documents covering an unknown number of non-aluminum and non-steel components,” as would be required under the CEE’s guidance, Friedman said.
"Read as we have suggested, the importer needs the supplier to provide one additional invoice or other support for the purchase price of the metal content. That is consistent with focusing on the metal ‘content,’ which is distinct from the fully fabricated finished article less the non-metal parts.
Friedman said it isn’t clear that the base metals CEE guidance represents a “final or even official policy position of CBP Headquarters,” noting that it didn’t come out on official letterhead or via an official channel like a CSMS message.
But until CBP headquarters clarifies the policy, importers that choose to report metal values based on the supplier’s purchase price then get a CBP Form 29 rate advancing the entry can protest that rate advance. Or, if an importer chooses to follow the CEE guidance, it can accept the rate advance or pro-actively amend entries via a post-summary correction, then file a protest if CBP headquarters subsequently publishes more favorable guidance and seek a refund, Friedman said.
“Remember that protests are due within 180 days following liquidation (and not before). If an importer is participating in Reconciliation, it may be possible to correct the metal values at the time of recon. By that time, there may be guidance,” Friedman said.