Background

The Office of the U.S. Trade Representative is accepting comments through April 12 on the issues raised in a World Trade Organization dispute initiated by Hong Kong alleging that a U.S. labeling change for goods made in that territory violates WTO rules. The U.S. has asserted that the change was made on national security grounds that cannot be reviewed by the WTO.

19 USC 1304 requires articles of foreign origin to be marked so as to indicate their country of origin to purchasers. Pursuant to a July 14 executive order, U.S. Customs and Border Protection announced the suspension of the application of section 201(a) of the U.S.-Hong Kong Policy Act of 1992, under which the U.S. continued to treat Hong Kong as a separate customs territory after it reverted to Chinese control in July 1997, to 19 USC 1304.

As a result, unless excepted from marking, goods produced in Hong Kong must be marked to indicate China, rather than Hong Kong, as their country of origin. This requirement took effect Nov. 9, 2020.

CBP has said this change does not affect country of origin determinations for purposes of assessing ordinary duties under HTSUS Chapters 1-97 or temporary or additional duties (including Section 301 tariffs on goods from China) under Chapter 99. Entry summary procedures also have not changed. Given that this change only applies to marking requirements under 19 USC 1304, CBP has said, filers should continue to file their entry summaries and submit payments for applicable duties, taxes, and fees in accordance with current regulations and policies.

For more information, please contact attorney Elise Shibles at (415) 490-1403 or via email or attorney Larry Ordet at (305) 894-1003 or via email.

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