Latest Harmonized System updates

Industry groups asked the U.S. government to work to repeal restrictions on NAFTA drawback and duty deferral and to expand ACE, in response to the Commerce Department’s request for information (here) on regulations that hamper domestic manufacturing. Although negotiators included the drawback and deferral restrictions in NAFTA to prevent China from using Mexico as a platform for component parts to be exported to the U.S., several companies involved in duty preference programs for foreign investors and domestic firms have nevertheless convinced suppliers from Asia and Europe to establish production facilities in Mexico to replace imports from non-NAFTA sources, according to the Duty Drawback Coalition’s comments (here). To counter the negative effects of NAFTA drawback restrictions on foreign-owned manufacturing plants in Mexico, Mexico established Sectoral Promotion Programs, which reduce several standard duty rates, the coalition said. Canada has reduced duty rates to mitigate the effects of the NAFTA drawback restrictions as well, the group said.

CBP said it created Harmonized System Update (HSU) 1701 on March 7, containing 1,754 ABI records and 360 harmonized tariff records (here). Modifications include "those made as a result of Presidential Proclamation 9555, To Implement the Nepal Preference Program," CBP said. The modified records can be retrieved electronically via the procedures indicated in the CATAIR. Further information: Jennifer Keeling, Jennifer.Keeling@dhs.gov

CBP posted documents for the upcoming Commercial Customs Operations Advisory Committee (COAC) meeting on March 1 (here) in Washington. Among the posted items are draft recommendations from the Rulings and Decisions Improvement Working Group of the Trade Modernization Subcommittee (here) that suggest CBP work to ensure sufficient resources for the Office of Regulations and Rulings (R&R) "in light of the foreseeable, imminent shifts in U.S. trade and border policy." The agency must be able to maintain "trade and other critical subject matter priorities despite other issues that may become of significant concern," it said. "COAC also feels this is necessary due to the Administration’s mandate to eliminate two regulations for every one regulation that the Government issues."

The National Electrical Manufacturers Association and the Global Lighting Association (GLA) are working to develop industry positions on possible changes to tariff classification of light-emitting diode (LED) lighting products, NEMA said in a blog post (here). The effort is focused on the 2022 update to the World Customs Organization’s Harmonized System, which is revised every five years, NEMA said. The WCO included some "GLA-supported changes for LED lamps" in the most recent update that went into effect on Jan. 1 (see 1701090021). "Anticipating further changes in the 2022 code to accommodate LED luminaire componentry, the GLA developed common positions on which NEMA has met with U.S. Customs and Border Protection (CBP) officials who represent the country at the WCO," it said. While the trade groups are still working to reach a consensus on recommendations for the WCO, "NEMA continues to confer with U.S. Customs and prepare for the 2022 HS," it said.

International Trade Today is providing readers with some of the top stories for Feb. 6-10 in case they were missed.

CBP said it created Harmonized System Update (HSU) 1701 on Feb. 9, containing 1,295 ABI records and 293 harmonized tariff records (here). Modifications include Partner Government Agency indicator changes "made to support the PGA message set functionality," CBP said. The modified records can be retrieved electronically via the procedures indicated in the CATAIR. Further information: Jennifer Keeling, Jennifer.Keeling@dhs.gov

The updates to the Harmonized Tariff Schedule that took effect Jan. 1 (see 1701050035) and changed the HTS codes for multilayered wood flooring don't affect the applicability of antidumping orders on such products from China, the International Wood Products Association said in a Jan. 26 email. Antidumping orders are based on the written language of the scope and any HTS codes provided "aren't directly associated," the IWPA said. Even so, "a number of brokers are apparently running into problems because the ACE system hasn’t been updated to recognize the new entry codes," the trade group said. Asked about the issue, CBP told the IWPA "ACE will accept entry lines filed with HTS numbers that are not yet in the AD/CVD case reference file HTS tab," according to the IWPA. "Filing the entries as such WILL NOT create a reject. An informational message is all that will be sent back to the broker. It will allow entry as a type 03 with the case number added. If no case number is added then it will not allow a type 03 entry."

The World Customs Organization updated its guide for updating preferential rules of origin in light of the numerous 2017 changes to the Harmonized System tariff schedule adopted by WCO members, including the U.S., the WCO said (here). "The increasing proliferation of preferential trade agreements containing many different Rules of Origin is a source of concern for WCO Members and economic operators," the WCO said. "In this connection, every effort needs to be made to mitigate the complexity involved in the implementation of Preferential Rules of Origin. Customs administrations, which occupy a central role in the implementation of preferential agreements, should play an important part to that end." The International Trade Commission recently posted the Preliminary Edition of the 2017 Harmonized Tariff Schedule, which implements the WCO tariff changes in the U.S. and largely took effect at the beginning of 2017 (see 1701090071).

CBP said it created Harmonized System Update (HSU) 1615 on Dec. 21, containing 813 ABI records and 166 harmonized tariff records (here). Modifications include changes to statistical suffixes and changes required by presidential proclamation. Adjustments were made to several partner government agency indicators as well. The modified records can be retrieved electronically via the procedures indicated in the CATAIR. Further information: Jennifer Keeling, Jennifer.Keeling@dhs.gov

CBP said it created Harmonized System Update (HSU) 1614 on Dec. 15, containing 27,913 ABI records and 4,820 harmonized tariff records (here). Modifications include the annual special program staged rate reductions and changes required by presidential proclamation. The modified records can be retrieved electronically via the procedures indicated in the CATAIR. Further information: Jennifer Keeling, Jennifer.Keeling@dhs.gov