Further to our update on May 8, 2019, U.S. Customs and Border Protection (“CBP”) issued a Cargo Systems Messaging Service (“CSMS”) message today that addresses how merchandise exported from China prior to May 10th, but entered for consumption in the United States on May 10th or thereafter, will be treated. A copy of CSMS #19-000236 is attached for your reference. csms-cbp
The good news is that CBP confirmed that such shipments are subject to the 10% duty rate (not the 25% duty rate). The bad news is that it will take CBP awhile to work out the programming to make that happen. As a result, importers will have to either (i) pay the 25% duty rate as of 12:01 am ET tomorrow and then file a Post-Summary Correction once the programming is completed to claim a refund, or (ii) wait to file the entry until the end of the 10-day period following arrival that is permitted under the regulations (and hope the programming is done in that window). Here is the relevant excerpt from the CSMS message:
For subject goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern standard time on May 10, 2019, and exported to the United States on or after May 10, 2019, report the following HTS numbers and duty rates:
HTS Duty Rate
9903.88.03 and 9903.88.04 25 percent
For subject goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern standard time on May 10, 2019, and exported to the United States before May 10, 2019, the 10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. CBP is working with USTR on additional guidance on the entry filing requirements for these imports.
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.
We hope that this update is helpful. If you have any questions, please let us know.