By Mark R. Ludwikowski et al.
Clark Hill PLC is an IMA Member
The International Trade Commission (“ITC”) has announced a new petition cycle for domestic manufacturers to seek temporary duty suspensions and reductions in accordance with the American Manufacturing Competitiveness Act of 2016 (“AMCA”). Petitions will be accepted until December 10, 2019 for consideration and inclusion in a Miscellaneous Tariff Bill (“MTB”) providing relief. This MTB would lower or eliminate duties on hundreds of products sourced globally, and could yield significant savings for qualified importers.
To qualify under the MTB program, importers must meet four criteria:
1. Revenue Loss Limit: The revenue loss threshold for the U.S. government is set at $500,000 per each approved provision. Duty elimination requests surpassing this amount may get the duties reduced, but only to the level that meets the mandated revenue limit threshold.
2. No Domestic Production Opposition: The purpose of the temporary duty suspension is to permit the limited duty free importation of products not made in the United States. If a domestic producer objects to the granting of a duty suspension for a product, and the objection is validated, Congress will not approve the duty suspension request.
3. Uncontroversial: Congress grants certain agencies of the U.S. government with oversight during the review process to determine the validity of the requested duty suspension provision. An agency may oppose the request based on policy or legal grounds. These cases may be deemed by Congress as controversial and be ineligible for duty suspension. In our experience, the instances where an agency objects on policy or legal grounds are very limited.
4. Enforceable: The U.S. Customs and Border Protection (“CBP”) is in charge of administering the duty suspensions at the time of importation. Therefore, the requested duty suspension must be written in a way that allows CBP to enforce the provision at the time of importation.
Companies importing goods that meet these conditions can receive significant duty savings initially for a period of three years. Petitioners may also request three year extensions every couple of years, thus making the original duty suspension granted virtually unending.
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