CBP Provides Instructions on Increased Section 301 Duties; New HTS Number Coming for Shipments on Water

CBP provided some details in a May 9 CSMS message on how importers should file entries that will be subject to the increased Section 301 duties on goods from China. The CSMS message confirms that the increased duties will only apply to goods exported and entered after May 10 (see 1905080035). During a call with software developers the same day, CBP officials explained that several pieces are still being worked out, including the addition of a tariff subheading for goods exported before May 10 and entered after the tariffs take effect.

CBP said that for "subject goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern standard time on May 10, 2019, and exported to the United States before May 10, 2019, the 10 percent duty rate will still apply." The agency "is working with USTR on additional guidance on the entry filing requirements for these imports," which will likely include a new Harmonized Tariff Schedule number. The CBP official said "we expect there will be another 99 tariff number" for those goods. "In the meantime, for goods entered on or after May 10, 2019, importers can pay the 25 percent duty and file a Post Summary Correction when filing instructions are available for the 10 percent duty. Alternatively, importers can delay filing their entry summary within the standard ten-day entry summary filing period until additional filing instructions are available for the 10 percent duty," CBP said.

Asked about what should be used as an export date, the CBP official said there "is a definition of export date for entry summary purposes in the ACE entry summary instructions." The export date in an entry summary will be the first date that CBP will check, though it should be consistent with other information, such as from a carrier, for verification purposes, he said. As to why the date of export was involved this time around, the CBP official said "you'll have to ask" the Office of the U.S. Trade Representative.

As for other entries subject to the increased duties, filers should use the HTS numbers 9903.88.03 and 9903.88.04 and a 25 percent duty rate, the agency said. An apparently premature update to CBP's system led to several industry complaints during the call. "In anticipation of the USTR notice, CBP had updated ACE to provide that goods entered on or after May 10 would be subject to the higher 25% rate of duty," the National Customs Brokers & Forwarders Association of America said in an email to members. "CBP will be reprogramming ACE to align with the USTR notice."

CBP is "also is in the process of confirming that the privileged foreign status date still holds" for foreign-trade zone entries, the agency official said. Asked about pre-filed entries that came before CBP made any changes to reflect the new tariff codes with a future entry date after May 10, another CBP official said filers may want to file a PSC or retransmit the filing with the new 99 tariff number to "protect" the 10 percent rate.