Trade Compliance Support May 2016

Trade Compliance Support May 2016

by

Trade Compliance is complicated and JD Group is here to help. Welcome to our series of trade compliance support articles specially designed to help you in managing trade compliance, avoiding surprises, reducing costs and achieving the best possible outcomes. We look forward to your questions and comments.

Biggest Change ever for the U.S. 9801.00.10XX Program

As of April 25, 2016 the rules and requirements for what is eligible under Subheding 9801.00.10XX, HTSUS will dramatically change. The new law expands the universe of articles that may be potentially imported duty-free by amending subheading 9801.00.10, previously for American goods returned, to allow the duty-free entry of any article, regardless of origin, that is exported and returned within three years of exportation, provided it is not advanced in value or improved in condition while abroad.

Old 9801.00.10XX

Requirements

  • • Product must be of U.S. Origin
  • • Cannot be advanced in value or improved in condition

Supporting Documents

  • • Manufacturer’s Affidavit or NAFTA certificate of origin
  • • Foreign Shipper / Importer’s Declarations

Commonly used in the following situations

  1. Returns of U.S. Origin Raw Materials
  2. Returns of U.S. Origin Machinery / Equipment
  3. Packaging Operations of U.S. Origin Goods
  4. Segregating returned U.S. Origin Packaging

New 9801.00.10XX

Requirements

  • • Item was exported within the last 3 years
  • • Cannot be advanced in value or improved in condition

Supporting Documents

  • • Export Documentation e.g. AES Record, Import Pedimento, Bill of Lading
  • • Foreign Shipper / Importer’s Declarations

Commonly used in the following situations

  1. Returns of Raw Materials (Any Origin)
  2. Returns of Machinery / Equipment (Any Origin)
  3. Packaging Operations of returned goods (Any Origin)
  4. Segregating returned Packaging (Any Origin)

Impact on Existing 9801 Programs

With the new law the following 9801 program will become obsolete for items that are being returned within 3 years from the date of export. As of April 25, all items currently being imported under the following 9801 programs can now be imported under the 9801.00.10XX program provided the items are within 3 years from the date of export and have not been advanced in value or improved in condition while abroad.

9801.00.2000

9801.00.2500

The Big Benefits for all Maquila/IMMEX Operations

  • • In our opinion Manufacturer’s Affidavits or NAFTA Certificates of Origin are no longer required when goods of any origin are returned within 3 years.
  • • Non-US Origin goods that are returned in their exact same condition can now be entered under the 9801 program
  • • If you perform any “kitting” or “packaging” operations in Mexico you may be able to significantly reduce your import duties by foregoing your current U.S. “inbond”operations.

The information in this article is general in nature and is not intended to constitute a legal or binding recommendation. Before engaging in any special program we strongly recommend that you consult with JD Group or another trade professional.