On Thursday, May 9, 2019, the Federal Register published a Notice of Modification of Section 301 Action by the United States Trade Representative (USTR) office increasing the rate of the additional duty from 10 percent to 25 percent on the $200 billion in List 3 products imported from China. The increase is effective Friday, May 10, 2019.

Effective Date Specifics

The Federal Register notice amends the Harmonized Tariff Schedule (HTS) of the U.S. to provide that the tariff increase for these List 3 products will be effective with respect to goods:

entered for consumption or withdrawn from warehouse for consumption, on or after 12:01am EDT time on May 10, 2019; and
exported to the U.S., on or after May 10, 2019.

This language is designed to provide a brief relief from the tariff increase for goods exported before 12:01am EDT on May 10, 2019. All importers and filers must consider both the Entry and Export dates.

According to the U.S. Customs and Border Protection (CBP): CSMS Message 19-000238

Goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01am EDT on May 10, 2019, and exported to the United States on or after May 10, 2019, report the HTS numbers 9903.88.03 and 9903.88.04 and pay the 25 percent duty rate.
Goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01am EDT on May 10, 2019, and before June 1, 2019, and exported to the United States before May 10, 2019, report HTS number 9903.88.09 and pay the 10 percent duty rate.
Goods entered into the United States on or after June 1, 2019, are subject to the 25 percent duty rate and should be reported under HTS numbers 9903.88.03 and 9903.88.04.

Exclusion Process

The official notice confirms USTR’s intention to implement a process for requesting exclusions from the tariff. USTR advised that it will publish a separate notice describing a process by which interested parties may request exclusions of specific products from the additional tariffs on these List 3 goods. It is expected that this process will mirror the exclusion process already established for List 1 and 2 products.

No Additional Tariffs Announced

This notice did not make mention of a possible additional tariff on the remaining products imported from China valued at $325 billion.

According to the federal register notice, this increase in tariffs is a result of a lack of progress in negotiations with China on a bilateral trade agreement. Per the notice, “China has chosen to retreat from specific commitments agreed to in earlier rounds.” However, trade talks do continue as senior Chinese officials arrived in Washington, DC, May 9, 2019.

For more information, please contact your local MIQ Logistics, a company of Noatum Logistics representative.