U. S. Customs and Border Protection (CBP) issued a Guidance document covering the Customs procedures applicable to the new duties imposed on derivative aluminum and steel articles under Section 232 on February 4, 2020, CSMS #41538803. The new Section 232 duties imposed by the President are effective on entries filed on and after February 8, 2020.

Derivative products are “downstream” articles from the original Section 232 article coverage in which aluminum or steel represent at least two thirds of the value of the finished article. The articles must meet certain thresholds for increased import volumes. The articles identified by the President for imposition of additional duties are steel nails, tacks, drawing pins, corrugated nails, staples, and similar derivative articles; aluminum stranded wire, cables, plaited bands, and the like (including slings and similar derivative articles); and bumper and body stampings of aluminum and steel for motor vehicles and tractors. They are specifically identified in the CSMS message, together with the applicable tariff numbers and Chapter 99 tariff numbers. https://content.govdelivery.com/bulletins/gd/USDHSCBP-279d4f3?wgt_ref=USDHSCBP_WIDGET_2?utm_source=csms.cbp.gov&utm_medium=csms.cbp.gov&utm_term=undefined&utm_content=undefined&utm_campaign=(not%20set)&gclid=undefined&dclid=undefined&GAID=1016774988.1544196117

The Customs procedures for these newly identified articles will be essentially the same as those already in place for Section 232. Entry documents must show the applicable Chapter 99 numbers as well as the tariff classifications for the articles themselves; additional duties of 25% for steel and 10 % for aluminum will be collected; the quota and excluded countries remain the same; restrictions apply for FTZ entries; GSP and AGOA preferences are not recognized; drawback will not be allowed. Further Guidance will be issued if product exclusions are granted.

A court action has already been filed seeking an injunction against implementation of these additional duties, based on the previous decision in the case on the increase of duties for steel from Turkey. That case (currently under appeal) held that the President’s authority under Section 232 could only be exercised within specified time periods and pursuant to specific procedures. Unless and until the court acts, CBP will follow the procedures outlined above with regard to importation of the specified derivative products.

Steven W. Baker

AIIS Customs Committee Chair

swbaker@swbakerlaw.com

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