President Donald Trump on June 30 released the annexes to Presidential Proclamation 10053, including provisions to implement the U.S.-Mexico-Canada Agreement, scheduling it for publication in the July 1 Federal Register. Among the annexes are new General Note 11 to the Harmonized Tariff Schedule, which lays out USMCA rules of origin. The proclamation also adds new special program indicators (SPIs) “S” and “S+” throughout the tariff schedule for goods eligible for USMCA treatment. These changes take effect July 1.
Harmonized Tariff Schedule
The Harmonized Tariff Schedule (HTS) is a reference manual that provides duty rates for almost every item that exists. It is a system of classifying and taxing all goods imported into the United States. The HTS is based on the international Harmonized System, which is a global standard for naming and describing trade products, and consists of a hierarchical structure that assigns a specific code and rate to each type of merchandise for duty, quota, and statistical purposes. The HTS was made effective on January 1, 1989, replacing the former Tariff Schedules of the United States. It is maintained by the U.S. International Trade Commission, but the Customs and Border Protection of the Department of Homeland Security is responsible for interpreting and enforcing the HTS.
CBP created Harmonized System Update (HSU) 2005 June 29, containing 124,980 Automated Broker Interface records and 24,925 Harmonized Tariff Schedule records, it said in a CSMS message. The update includes changes necessary to implement the U.S.-Mexico-Canada Agreement and to support the automation of softwood lumber assessments. The update also covers modifications mandated by the 484 F Committee (the Committee for Statistical Annotation of Tariff Schedules) and recent Section 301 tariff exclusions. Further information: Jennifer Keeling, Jennifer.L.Keeling@cbp.dhs.gov.
CBP is issuing an interim final rule to implement rules of origin provisions for the U.S.-Mexico-Canada Agreement that will take effect July 1. The interim rule creates new Part 182 to the customs regulations for USMCA, and amends existing NAFTA regulations under 19 CFR Part 181 so that they no longer apply to entries on or after July 1. Most of 19 CFR Part 182 is vacant, but CBP says it will fill out the regulations over the coming year. Comments on the interim regulations are due Aug. 31.
The International Trade Commission recently released a list of some of the upcoming changes to the Harmonized Tariff Schedule that will take effect on July 1. The list, provided by the National Customs Brokers & Forwarders Association of America, details changes to 10-digit statistical suffixes agreed to by the interagency 484(f) Committee. Affected tariff provisions cover dried tart cherries, rice, wines, propane, diagnostic reagents, disinfectant wipes, viral transport media, face masks and other personal protective equipment, crystalline glassware, stainless steel kegs, mobile clinic vehicles, infrared thermometers, foldable mattress foundations and ancient coins, among other things. The list is not a complete record of all changes that will take effect July 1, and does not include any tariff schedule changes necessary to implement the U.S.-Mexico-Canada Agreement.
The Commerce Department issued Federal Register notices on its recently initiated antidumping duty investigations on passenger vehicle and light truck tires from South Korea, Taiwan, Thailand and Vietnam (A-580-908, A-583-869, A-549-842, A-552-828), and countervailing duty investigation on passenger vehicle and light truck tires from Vietnam (C-552-829).
Of the 52,746 exclusion requests related to Section 301 tariffs, 75.4% have been denied, and 12.3% are still under review, a new Congressional Research Service report says. Because most exclusions are for specific products, and don't cover an entire Harmonized Tariff Schedule subheading number, it's not possible to know how much trade is covered by the exclusions, CRS said. The report noted that some Congress members complain about the Office of the U.S. Trade Representative picking winners and losers, while others feel any exclusion undermines the ability of Section 301 to address China's unfair trade practices.
Generally, an entry is liquidated after 314 days, but Geodis customs brokers told an audience of fashion industry professionals that there have been cases in which liquidation came early, and there was not enough time left to do a protest in order to get a refund after an exclusion was granted. The brokers spoke during a webinar hosted by the U.S. Fashion Industry Association.
The Commerce Department issued notices in the Federal Register on its recently initiated antidumping duty investigations on walk-behind lawn mowers from China and Vietnam (A-570-129, A-552-830), and its countervailing duty investigation on the same product from China (C-570-130). The CV duty investigation covers entries Jan. 1, 2019, through Dec. 31, 2019. The AD duty investigations cover entries Oct. 1, 2019, through March 31, 2020.
The U.S. in April imported more laptops and tablets than in any previous April in the category's history, according to Census Bureau data accessed June 15 through the International Trade Commission’s DataWeb tool. It was clear evidence of the surge in demand for work-from-home and remote-learning productivity tools after COVID-19 forced much of the U.S. into sudden lockdowns.
Importers may want to delay filing for U.S.-Mexico-Canada Agreement reconciliation because the USMCA currently doesn't allow for post-entry refunds of merchandise processing fees, CBP officials said during a National Association of Foreign-Trade Zones webinar on June 16. Maya Kamar, CBP director for textiles and trade agreements, said that although the Office of the U.S. Trade Representative is working with Congress for a legislative fix to the issue, CBP doesn't yet have clarity on whether such a bill will pass (see 2006050034).