NEW YORK -- Clients are asking "how can I make a bad situation better," said Mary Jo Muoio, senior vice president for trade services for Geodis, a customs broker firm. Muoio, who was speaking on a panel on "Tackling the Trade War: Solutions for Companies Across the Supply Chain" at the Apparel Importers Trade and Transportation Conference, said some of those client questions and plans are not sophisticated. She quoted one client who asked: "If I send it to Taiwan and label it Taiwan, does it get me out of the 301?" She quipped, "Well, it gets you in jail."
Customs Duty
A Customs Duty is a tariff or tax which a country imposes on goods when they are transported across international borders. Customs Duties are used to protect countries' economies, residents, jobs, and environments, by limiting the flow of imported merchandise, especially restricted and prohibited goods, into the country. The Customs Duty Rate is a percentage determined by the value of the article purchased in the foreign country and not based on quality, size, or weight.
The de minimis footnote within the U.S.-Mexico-Canada Agreement is cause for "serious concerns" for the Customs Matters and Trade Facilitation Industry Trade Advisory Committee (ITAC 12), the committee said in an addendum to its report on the trade deal. The addendum, which is dated Oct. 24 but was released by the Office of the U.S. Trade Representative this week, is among multiple reports updated after Canada agreed to join the deal between the U.S. and Mexico. While the main advisory committee offered some light criticism in its support of the deal (see 1811060023), individual ITACs included some more pointed concerns.
A first group of CBP information requests related to imports covered by the Section 301 tariffs on goods from China is expected to go out in the next couple weeks, Baker & McKenzie lawyer Ted Murphy said in a Nov. 6 blog post. CBP has said it plans to initially focus on imported electronics and will be adding new auditors to its field offices (see 1810230022). "Our contacts in Regulatory Audit have informed us that, as part of this effort, a first 'wave' of CF-28s (Requests for Information) since the imposition of the Section 301 duties will be issued in 2-4 weeks," Murphy said.
Retaliatory tariffs for U.S. tariffs on steel and aluminum were delayed again by India, the country's Department of Revenue said in a Nov. 1 notice. The tariffs, which were previously delayed to Nov. 2, are now set to take effect on Dec. 17. The retaliatory tariffs, first announced in May (see 1805180064), target agricultural products, motorcycles, steel products, and phosphoric and boric acid, and are aimed at offsetting the $241 million in duties India expects its U.S. customers to pay on its steel and aluminum exports. The tariffs were originally expected in June, but have been delayed multiple times. Many of the items already face high tariffs -- walnuts are taxed at 100 percent, fresh apples at 50 percent, chickpeas at 60 percent, motorcycles at 100 percent -- but the actions would add 10 percent more to many ag products, 20 percent more to walnuts and almonds, and 50 percent more to motorcycles.
No business or labor group came out against the U.S.-Mexico-Canada Agreement, in comments filed to the International Trade Commission, even as some groups expressed concerns about aspects of the deal to replace NAFTA. Comments are due before the ITC holds a hearing on Nov. 15.
A CBP proposal to revoke several rulings on sheep’s milk cheese hinges on a misinterpretation of the word “pecorino” as only referring to cheeses of Italian origin, the Cheese Importers Association of America said in comments to the agency dated Oct. 31. CBP’s proposed revocation of 11 ruling letters and modification of another five that currently classify sheep’s milk cheeses, including feta and manchego, in subheading 0406.90.57 for pecorino not suitable for grating would cause “a significant adverse impact for those who have invested in businesses importing the subject cheeses,” the CIAA said.
A recently filed lawsuit in D.C. federal court seeks to compel CBP testimony in a long-running case brought against an importer by a company founded to file customs fraud lawsuits. Customs Fraud Investigations says CBP is refusing to send an officer to testify in a False Claims Act whistleblower suit in Eastern Pennsylvania U.S. District Court on whether Victaulic failed to properly mark its pipe imports, and should have paid marking duties (see 1610060030).
The Cheese Importers Association of America plans to oppose a proposal from CBP to revoke and modify ruling letters involving sheep's milk cheeses (see 1809280037), the group said in a notice to its members. CBP will allow for additional time for comments on the proposal, CIAA said. "The consequence of this action will be to move several cheeses, including Manchego and Feta, from a customs classification with a 0% duty to another classification with a 9% duty," it said. "CIAA intends to submit comments and will make our letter available to members in the near future. We encourage members to submit their own letters opposing the CBP recommendation." CBP's proposal would change the classification for the cheeses from a subheading that specifically refers to Pecorino cheese.
CBP correctly based liquidations of merchandise upon the price paid by the U.S. customer and not the transfer price between a Canadian party and its related importer of record, the agency said in a July 12 ruling. CBP's decision in HQ H285847 followed an application for further review of protest from Group JS International and the company's lawyer at Sandler Travis. The ruling came through the Apparel, Footwear and Textiles Center of Excellence and Expertise.
CBP published the quarterly Internal Revenue Service interest rates used to calculate interest on overdue accounts (underpayments) and refunds (overpayments) of customs duties. For the quarter that began Oct. 1 and ends Dec. 31, 2018, the interest rates for overpayments will be 4 percent for corporations and 5 percent for non-corporations, and the interest rate for underpayments will be 5 percent for both corporations and non-corporations. These interest rates are subject to change for the calendar quarter beginning Jan. 1, 2019, and ending March 31, 2019, CBP said.