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Guidance on Product Exclusions for Section 232 Steel and Aluminum Tariffs

Monday, July 30, 2018
Sandler, Travis & Rosenberg Trade Report

The Bureau of Industry and Security and U.S. Customs and Border Protection have made available the following guidance on obtaining and utilizing product exclusions from the 25 percent additional tariff on steel and the 10 percent additional tariff on aluminum being imposed for national security reasons under Section 232 of the Trade Expansion Act of 1962.

(Click here for ST&R’s web page providing comprehensive information on all U.S. tariffs imposed under Section 301 and Section 232 as well as the retaliatory tariffs trading partners are levying on U.S. goods.)

Exclusion Criteria. A product exclusion will be granted if the article is not produced in the U.S. in a sufficient and reasonably available amount of satisfactory quality or if there is a specific national security consideration warranting an exclusion.

Review Process. The Department of Commerce reviews each request for conformance with the submission requirements. Once a request is posted there is a 30-day comment period.

If there are no objections, CBP reviews the HTSUS number cited for accuracy. If CBP determines the number is inaccurate the request is denied and the requester is provided with CBP contact information. If the number is accurate the request is approved if there are no national security concerns and the decision is posted on www.regulations.gov.

If objections are submitted the DOC reviews each objection for conformance with the submission requirements. If an objection is posted the DOC reviews the request and the objection(s) and determines whether the item meets the above exclusion criteria.

Exclusion Notifications. All product exclusion decisions will be posted on www.regulations.gov. For each exclusion request the DOC will post a decision memo identifying whether the request is granted or denied.

If the request is denied due to an incorrect HTSUS number the memo provides information how on to obtain a correct classification from CBP. After the correct classification is obtained the requester may resubmit the request, noting that it is a resubmission with a revised classification and attaching the CBP determination.

If the request is denied for other reasons the memo will state the reason. If the denial is based on an objection the requester may file a new request and include information documenting the reason the new request should be granted notwithstanding the prior objection(s); e.g., the inability or refusal of the objector(s) to provide the product.

Using Exclusions. Granted exclusions will be effective five days after the decision has been posted on www.regulations.gov. An exclusion is generally granted for one year from the date of signature and will not be revoked unless the DOC has determined that submitted information was falsified. The use of an exclusion by any entity other than the organization that filed the original request is prohibited.

CBP will receive a notification from the DOC of any specific company and product to be excluded from the applicable tariff. The approved importer of record’s name, address, and IOR number, as well as the associated product exclusion number, must be submitted to CBP before the importer of record submits the exclusion number with entries to CBP. The product exclusion number is based on the last six digits of the product exclusion docket number at www.regulations.gov and should be submitted in the importer additional declaration field (54 record) of the entry summary data based on the following format: STLXXXXXX for steel products and ALUXXXXXX for aluminum products. The corresponding HTSUS Chapter 99 number for the Section 232 duties should not be submitted when the product exclusion number is submitted.

Steel importers must also submit mill certificates with their import data as required by 19 CFR 141.89.

Refunds. Granted product exclusions are retroactive to the date the request was posted for public comment. For any exclusions approved by DOC prior to June 1, 2018, importers may request a refund by submitting a post-summary correction with the product exclusion number in the importer additional declaration field.

Once products are excluded importers may claim Generalized System of Preferences or African Growth and Opportunity Act duty preferences on GSP and AGOA-eligible goods. If importers did not receive GSP or AGOA duty preferences on previous imports and those imports are now covered by a retroactive exclusion, importers may request a refund of the duties subject to GSP or AGOA preferences through a PSC.

If the entry has already liquidated, importers may protest the liquidation.

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