Changes to interest rate calculations for reconciliation

Changes published today in CBP Admin Message CSMS# 19-000310 Interest Rates for Reconciliation

Effective July 2019, CBP will no longer publish on CBP.gov the quarterly interest rates for Reconciliation. Filers can find the quarterly rates on the www.irs.gov website by querying “quarterly interest rates for (YYYY)” in the search engine located on the upper right hand corner of the webpage.

The Reconciliation section of the ACE Business Rules will be updated with the above website for identifying the quarterly rates.

If you have any questions or require additional information, please email OT-RECONFOLDER@CBP.DHS.GOV, Commercial Operations, Revenue and Entry Division, Office of Trade.

To which CEE do you belong?

U.S. Customs Centers of Excellence and Expertise, aka “CEEs” are Customs way to better align with modern business practices. Whether or not you are currently engaged with your CEE, Importers are already assigned to one.

Ever wonder how to find out which CEE team has been assigned to your company? 

Well, it’s not as difficult as you may have thought… In order to get the details, you just need to do a simple bond query with your company’s Federal Identification number, either though your surety, Customs broker, or in ABI/ACE directly . The query results will show you who your CEE team is.  Below is an example of how it looks in the ABI response.

It’s as simple as that! Contact CustomsNow if you have any questions.

CBP Trade Symposium announced – July 23rd-24th

CBP TRADE SYMPOSIUM IN CHICAGO – CBP sent out a formal notice that the Trade Symposium will be held in Chicago this year. The registration will open on Thursday, June 13th, at noon EST. Learn more here.

This is always a great event to get up-to-date information on current trade activities. The event sells out quickly so be sure to register early!

Processes for US Goods Returned

Goods that were manufactured in the United States (US) and returned to the US are eligible for free entry back into the country only if:

  • They have not undergone any advancement in value due to upgrades, repairs, improvements in condition or any other processing which would elevate the value of the item.  
  • If the goods were subjected to changes which improved the condition then you would be responsible for paying duty on the fair market value of the labor or the item as it has been changed.  Chapter 9802 would cover the repairs, changes value. 
  • **NOTE**, duty is only assessed on the actual repair or improvement not on the entire value of the goods. 

If the goods have not been subjected to any of the outlined processes above then you would file a CBP Form 3311, Declaration for Free Entry of American Goods Returned here.   This would entitle you to free entry under HTS 9801.00.10 as duty free.

GOODS FOR WHICH DUTY HAS ALREADY BEEN PAID RETURNING TO THE US

A common question which arises is “what if I have goods on which duty has already been paid returning to the US”, for example a product sold that is defective, damaged, doesn’t conform to a certain specification outlines by the buyer etc..  

Subheading 9801.00.26, HTS provides for articles, previously imported, with respect to which the duty was paid, if

  • They were exported within 3 years after the date of such previous importation.
  • Sold for exportation and exported to individuals for their personal use, re-imported for the reason hat such articles do not conform to sample or specifications
  • Re-imported without having been advance in value or improved in condition by any process of manufacture or other means while abroad.
  • Re-imported as personal returns from those individuals; and re-imported by and for the account of the person who exported the goods from the United States within one year of the exportation.

If all of these conditions are satisfied, the goods are eligible to be re-imported duty free.  Also, if the goods are imported under HTS 9801.00.26 they are not subject to visa or quota requirements as well.

However, if the goods were originally exported with the benefit of drawback, the goods will not be eligible for duty-free treatment upon re-import.  The reason being, U.S. Note 1(a), Subchapter I, Chapter98, HTS, states that subheading 9801.00.26 would not apply to an article exported with the benefit of drawback.

***NOTE*** CBP has the right to request proof from the exporting party that duty was paid upon the previous import of the items.   

“The New NAFTA” – informative article from SupplyChainBrain

nafta-main

Need a good introduction to “New NAFTA”?  An article written today by Robert J. Bowman, SupplyChainBrain, called “The New NAFTA: What Does It Mean For Supply Chains?”, is a great place to start.

This Q&A covers topics associated with the new agreement and the potential impact to U.S. supply chains.

Specifics about the new deal, called the United States-Mexico-Canada Agreement, or USMCA, have been published on the Office of The United States Trade Representative website, found here.

CSMS# 18-000689 RECONCILIATION FILING-FREE TRADE AGREEMENTS (FTA)

ace-logoACE FILING NOTICE – RECON

According to to CBP CSMS# 18-000689, issued today, November 21, when filing a reconciliation for a Free Trade Agreement issue, ACE is displaying incorrect original paid amounts. Until headquarters issues further guidance, filers should submit the reconciliation header information in the Document Imaging System (DIS) when filing the reconciliation with a FTA issue.

If you have any questions or require additional information, please send an email to
OT-RECONFOLDER@CBP.DHS.GOV, Commercial Operations, Revenue and Entry Division, Office of Trade.

Changes (again) to CBP user fees, effective October 1, 2018

As just announced in CBP’s CSMS #18-000465, dated August 1, 2018, various changes to user fees will take effect on October 1, 2018.

The Merchandise Processing Fee (MPF) ad valorem rate of 0.3464% will NOT change.  However, note the following changes:

  • The MPF minimum and maximum for formal entries (class code 499) will change – the minimum will change from $25.67 to $26.22 and the maximum will change from $497.99 to $508.70.
  • The Informal MPF (class code 311) will change to $2.10.
  • The dutiable mail fee (class code 496) will change to $5.77.
  • The surcharge for manual entry or release will change to $3.15.

The Federal Register Notice (83 FRN 37509) can be read here.  Another CSMS will be sent when the changes are in the ACE Certification environment for trade testing.

U.S. imposes 25% tariffs on approximately $50B of Chinese goods

china us trade

On Friday June 15th, 2018, the United States Trade Representative (USTR) announced that the U.S. will follow through with 25 percent tariffs on approximately $50 billion worth of goods from China in 2018 import value (read announcement here).

The list of goods covered by the order includes mainly industrially significant technology products spread across 1,102 U.S. tariff lines.  The list of specific tariff numbers can be found here and, as announced, CBP will begin collecting these additional duties beginning July 6th.

Additionally, there is a second set of HTS numbers which have been identified by the interagency Section 301 Committee as benefiting from Chinese industrial policies.  These include the “Made in China 2025” industrial policy, and the set covers about $16 billion worth of imports from China. The second set of products will undergo a public notice and comment process, including a public hearing, after which USTR will issue a final determination on the products from the list that would be subject to the duties, the agency said.  Crowell Morning Trade Law wrote a good overview on this, here.

The USTR will “soon provide an opportunity” for the public to request exclusion of “particular products” from the duties to be imposed under Section 301 of the Trade Act of 1974, and will issue a notice in the Federal Register with details on this process within the next few weeks, USTR said.

Changes to China’s manifest system – what you need to know!

chinaChina’s 24 hours Advanced Manifest Regulation Update

Have you been asked by your Chinese partners for additional company information for new shipment into and out of China?  It is our initial understanding that for US entities the information requested is the consignee or notify party’s company Employee Identification Number (EIN).   The carrier OOCL provides a good overview to their customers on  their website, here.

Our friends at NCBFAA are also working diligently on providing guidance on the new requirements for shipments to and from China. The regulations are confusing and in some cases contradictory. We will follow up with addition information as it becomes available.

The GACC published the original requirements in 2008 in Decree No. 172. These specific requirements were not implemented in 2008. Customs announced in Notice No. 56 that implement would begin June 1, 2018. (See links to the notices below).

Below are some additional links to the GACC notices:

USTR publishes proposed action and China reacts with it’s own list

Achina us trades announced, the U.S. Trade Representative (Trade Representative; USTR) has determined that the acts, policies, and practices of the Government of China related to technology transfer, intellectual property, and innovation covered in the investigation are unreasonable or discriminatory and burden or restrict U.S. commerce. The Office of the U.S. Trade Representative (USTR) is seeking public comment and will hold a public hearing regarding a proposed determination on appropriate action in response to these acts, policies, and practices. The Trade Representative proposes an additional duty of 25 percent on a list of products from China. The list of products, defined by 8-digit subheadings of the Harmonized Tariff Schedule of the United States (HTSUS), is set out in the Annex to this Notice.

The official 301FRN notice is:  OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE Docket No. USTR-2018-0005 Notice of Determination and Request for Public Comment Concerning Proposed Determination of Action Pursuant to Section 301: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation.  Read the notice here.

Attorneys Susan Kohn Ross and Kevin Rosenbaum from MSK, published a blog article today which gives a complete overview of the situation.  Read here.  As they also say, “Stay tuned for more developments”.