As you may have heard, the United States and China reached an agreement late Monday to update the Information Technology Agreement (ITA). The ITA, which was originally agreed to in 1996, seeks to reduce customs duties applicable to high-tech products.
After more than a year of stalled negotiations, an agreement was reached between the U.S. and China on the sidelines of the APEC forum currently being held in Beijing. This agreement is reported to cover 200 different tariff categories, including MRI machines, GPS devices and advanced semiconductors. The agreement needs to ratified by all 54 jurisdictions that participate in the ITA (which is expected) and this could occur as early as next month.
At this point, the text of the agreement is not yet available. It is also not clear whether the duty reductions will be immediate or phased in over time. Stay tuned for additional information.
Given that most products now include some form of technology, all companies should be interested in this development and confirm whether their products will benefit.
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