International Practice Section Blog: Save on Import Duties with the Miscellaneous Tariff Bill – Apply by Dec. 10:

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  • International Practice Section Blog
    December
    03
    2019

    Save on Import Duties with the Miscellaneous Tariff Bill – Apply by Dec. 10

    Ngosong Fonkem

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    With the current trade war, companies should implement proactive strategies to tackle challenges that impact their global supply chain. Ngosong Fonkem discusses the Miscellaneous Tariff Bill process and how it can be an effective proactive strategy. Act quickly – the deadline to apply is Dec. 10.

    The trade war between the U.S. and China has significantly disrupted the once predictable global trading system.

    Trade disruptions, however, are not anomalies – as U.S. trade policy since its founding has oscillated through periods of protections. In fact, the earliest such trade disruption occurred after the war of 1812, when Thomas Jefferson imposed a trade embargo on Britain.

    Because the current trade war is likely to persist for decades – one of the U.S.’s stated goals is to decouple its economy from the Chinese economy – any astute stakeholders should develop proactive strategies to tackle challenges that will likely impact their global supply chain.

    The Miscellaneous Tariff Bill Duty Suspension Process

    One particularly effective risk management strategy for managing trade risks is to seek, through legislative means, a reduction in import duties on inputs that are needed to complete finished goods that the U.S. government deem inaccessible to U.S. companies.

    The U.S. International Trade Commission’s (ITC) Miscellaneous Tariff Bill (MTB) duty suspension process, which allows U.S. companies to petition Congress for suspensions and reductions of “normal” most favored-nation (not additional) duties paid on qualifying U.S. imports, is a particularly effective strategy to accomplish this goal.

    Ngosong Fonkem com ngosongf addison-clifton Ngosong Fonkem, West Virginia University 2011 (JD, MBA) and Tulane Law School 2012 (LLM), is a senior advisor at Addison-Clifton LLC, Milwaukee. He assists U.S. and foreign companies with compliance with U.S. trade laws and related audits and with conducting business business in Asia.

    Specifically, the MTB duty suspension process, in its current iteration, came into force under the American Manufacturing Competitiveness Act of 2016. That legislation was designed to temporarily reduce or suspend customs duties on products that are not produced in the U.S., or if such production exists, has no competition from a U.S. producer.

    To qualify for the tariff benefit, the estimated loss in revenue to the U.S. government from the duty suspension or reduction on each product must be less than $500,000 in a calendar year.

    Miscellaneous Tariff Bill: Petition Process and Timeline

    The MTB petition process begins with interested companies filing a formal petition with the ITC.

    The process for the submission and consideration of petitions is described in the MTB regulations (in 19 C.F.R §220) and is summarized here:

    • Petitions are filed: Interested parties have between Oct. 11, 2019, and Dec. 10, 2019 to file their petitions on the ITC portal.

    • Public comment period: Within 30 days after the petition request period expires, the ITC will publish the submitted petitions on their website and publish a notice in the Federal Register requesting comments from members of the public for a 45-day period.

    • ITC issues report to Congress: Within 210 days after releasing the list of petitions, the ITC will submit a final report to Congress, listing all products that satisfy the MTB criteria.

    • Congressional approval of MTB: After reviewing the ITC’s report, the House and Senate will prepare MTB legislation to amend Chapter 99 of the Harmonized Tariff Schedule of the United States (HTSUS).

    Act Quickly: Dec. 10 Deadline

    The MTB process offers a unique window of opportunity for duty savings that is available only once every few years.

    As the deadline for filing a petition is Dec. 10, 2019, interested stakeholders such as U.S. importers, manufacturers, and suppliers seeking to benefit from this unique opportunity must act swiftly.





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