Customs Duty

Some new tariff provisions in the 2019 edition of the Harmonized Tariff Schedule have already been implemented, despite the ongoing partial federal government shutdown and the resulting lack of any official version published by the International Trade Commission. According to documents recently posted by the National Customs Brokers & Forwarders Association of America, changes affect classification for infant footwear, aluminum foil and paper, among other products. Extensive changes were also made to units of measure throughout the tariff schedule. On the other hand, changes made by a recent presidential proclamation, including the removal of African Growth and Opportunity Act (AGOA) benefits for Mauritania, have yet to be implemented by CBP, the NCBFAA has said. The following is a summary of the purported changes to the tariff schedule:

Continued economic "prosperity" is no "foregone conclusion” amid the broadly held concern about the impact to the U.S. economy of the Section 301 tariffs on Chinese imports, Section 232 tariffs on steel and aluminum imports, and “corresponding retaliation against U.S. exports, said Americans for Free Trade in a Jan. 9 “welcome” letter to newly elected and returning members of Congress. “We agree that China must be held to account for its violations of our trade laws and the international trade obligations all nations share,” said the coalition, whose 150 members include multiple associations of customs brokers. “Imposition of a tariff of up to 25 percent on $250 billion worth of China products -- and the threat to impose a similar duty on $267 billion more of such products -- will not remedy the situation. We continue to see stories on a daily basis about companies, both large and small, who are being harmed by these tariffs.” The coalition urges Congress to “exercise its oversight role on trade policy matters to prevent further harm to U.S. workers, consumers, and families that will result from both the existing and proposed tariffs,” it said.

BDO is launching a new customs and international trade practice following its acquisition of Global Trade Strategies (GTS), it said in a Jan. 9 press release. The new practice “will help multinational companies navigate the complex rules governing the cross-border movement of goods and services, with the goal of minimizing duty, VAT and excise tax payments, while maximizing corporate customs and trade compliance,” the professional services firm said. Damon Pike, the customs lawyer that founded GTS, will join BDO as a principal and lead the practice. GTS employees have also joined BDO and will be based in its South Florida offices.

Revenues were flat in the first quarter of fiscal year 2019, as a major decline in corporate income taxes was offset by a sharp jump in tariff revenue, the Congressional Budget Office reports. Customs duties increased by $8 billion, or 83 percent, compared with the same October-December quarter in 2017. CBO said the increase was "largely because of new tariffs imposed by the Administration during the past year." CBP said in November that it has assessed more than $10 billion under the recent Trump administration Section 201, 232 and 301 trade remedies (see 1811260010).

The ongoing partial federal government shutdown is causing some confusion for the trade community on tariff classification. CBP’s last tariff update in the Automated Broker Interface came on Dec. 19 (see 1812190004), but the International Trade Commission has not yet issued its annual update to the online Harmonized Tariff Schedule (see 1901020021). Further complicating matters, a presidential proclamation making more changes to the HTS is now set for publication on Jan. 7 (see 1812270038).

International Trade Today is providing readers with some of the top stories for 2018 in case they were missed.

In recent editions of the Official Journal of the European Union the following trade-related notices were posted:

Customs brokers may still be sued under state laws despite a 1995 law that barred state claims against companies engaged in ground transportation, the U.S. District Court for Massachusetts said in a Dec. 20 decision. The federal law only pre-empts claims against motor carriers, freight brokers and forwarders engaged in ground transportation, and customs brokers don’t fall under any of those categories, the court said, allowing portions of an importer’s case against C.H. Robinson to go forward.

Bonds covering antidumping duties were not retroactively declared invalid by a 2006 law that temporarily suspended the option to post bonds instead of cash deposits for goods subject to new shipper reviews, the Court of International Trade said in a Dec. 14 decision. Hartford Fire Insurance had argued it didn’t owe CBP uncollected duties on entries of fresh garlic from China because the Pension Protection Act, passed in August 2016, retroactively nullified existing bonds going back to April of that year. The trade court disagreed, finding the law’s retroactive application only barred importers from relying on new bonds instead of cash deposits for entries subject to new shipper reviews. Existing bonds issued before the law was enacted remained in effect, it said. “In sum, the PPA does not alter the status of bonds already lawfully filed with Customs, or the ability of Customs to collect against those bonds,” CIT said. The Trade Facilitation and Trade Enforcement Act of 2015 has since permanently ended the bond option in new shipper reviews (see 1606070008).

Six entries of stainless steel plate in coils (SSPC) imported in 1999 from Belgium that were subject to antidumping and countervailing duty orders were deemed liquidated by operation of law, Court of International Trade Judge Kenton Musgrave said in a Dec. 21 ruling. The importer, Arbed Americas, LLC, sued CBP over the 2011 liquidation of the entries. Those entries were caught up in a separate lawsuit that resulted in the U.S. Court of Appeals for the Federal Circuit suspending liquidation of all entries of SSPC from Belgium and remanding a denied preliminary injunction back to CIT.