Guide: How to obtain tariff exemption for your business?
The USTR has established an exclusion process for the first (34 billion worth of Chinese imports on List 1) and second (16 billion worth of Chinese imports List 2) round of the Section 301 Tariffs against China. But it has NOT established an exclusion process for the $200 billion worth of Chinese imports on List 3. There is currently a bipartisan bill in Congress (Import Tax Relief Act) to require the establishment of a such process for all products affected by the Section 301 tariffs.
In order to be eligible for filing a request of exemption for products on List 1 and 2, your company must have the following:
- Physical identification of the requested product exemption. This includes dimensions, weight, material composition, etc. that distinguish it from other products. Precision is key. Products may not be identified by the producer, importer, consumer, or actual use or chief use. Likewise, trademarks and tradenames cannot be used.
- The 10-digit subheading of the HTSUS applicable to the product.
- The annual volume and value of the Chinese-origin product that the purchaser (you) have purchased in each of the last 3 years.
- Whether or not the product is available in China exclusively, or other countries as well.
- Whether or not the new tariff would cause harm to the purchaser or other U.S.-affiliated organizations, individuals, or businesses.
- Whether the particular product is strategically important or related to “Made in China 2025” or other Chinese industrial programs.
Any request that contains business confidential information must be accompanied by a public version. The public version will be posted on regulations.gov. All requests, responses, replies will be filed on regulations.gov under document ID USTR-2018-0025-001. Once the Federal Register notice is published the forms will be accessible through the regulations.gov portal. The most important factors in request evaluation on the part of the USTR are: whether the product is available for purchase outside of Chinese suppliers, whether the new duties/tariffs would cause significant economic harm, and whether it is important to Chinese industrial programs (like Made in China 2025).