CBP Implements Grace Period Thru November 18 for Origin-Conferring MID Requirement for Textile and Apparel Products
U.S. Customs and Border Protection (CBP) recently issued an interim rule which, effective October 5, 2005, eliminated the textile declaration requirement and newly required the Manufacturer Identification Code (MID) for textile and apparel products from all countries to be constructed from the name and address of the entity performing the origin-conferring operations, etc. (See ITT's Online Archives or 10/06/05 news 05100605 for Part I of BP's two-part summary of this interim rule.)
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On October 6, 2005, CBP posted its instructions regarding the elimination of the textile declaration and the new origin-conferring MID requirement for textile and apparel products. (See ITT's Online Archives or 10/11/05 news, 05101105 for BP summary of CBP instructions.)
CBP Postpones Enforcement of Origin-Conferring MID Requirement Thru Nov 18
CBP has now announced that it has instructed the ports to postpone taking any enforcement action on this new MID requirement through November 18, 2005.
CBP states that this will give the trade community some time to establish procedures to comply with the new regulation (i.e., interim rule), and provide accurate MIDs for shipments of textile and apparel products. During this grace period, CBP will not reject entries or assess penalties on brokers or importers for submitting incorrect MIDs for shipments of textile and apparel products.
Full Enforcement of Origin-Conferring MID Requirement Begins Nov 19
According to CBP, for all textile and apparel products listed in 19 CFR 102.21(b)(5)1 that are entered on or after November 19, 2005, CBP will fully enforce the requirements of the new regulation (i.e., interim rule).
Importers and brokers will be responsible for exercising reasonable care to accurately construct MIDs using the methodology set forth in CBP regulations (as explained in an appendix to 19 CFR 102 added by the interim rule).
CBP also states that entries and entry summaries presented to CBP with incorrect MIDs will be rejected. In addition, repetitive errors in the construction of MIDs for entries of textile and apparel products will result in the assessment of broker and importer penalties for the failure to exercise reasonable care.
(Readers should note that in its October 6, 2005 instructions regarding the origin-conferring MID, CBP had stated, among other things, that when a single entry is filed for products of more than one manufacturer, the products of each manufacturer must be separately identified.
CBP sources had explained that this means, for example, that if an importer or broker is preparing a single entry for imported apparel merchandise from one trader, that consists of (either the same or different) apparel products from five different origin-conferring manufacturers, the broker or importer filing the entry must construct a MID for each of the five origin-conferring manufacturers.
Sources had added that the trader may need to be contacted in order to obtain the information necessary to construct these MIDs.
CBP's October 6, 2005 instructions had also stated that trading companies, sellers other than manufacturers, etc. cannot be used to create MIDs.
In addition, entries and entry summaries in which the first two characters of the MID do not meet the country of origin ISO code, or that are created from a company that is known to be a trading house or agent and not a manufacturer, will be rejected for failure to properly construct an MID. However if a port [only] has suspicions that a declared MID is not a manufacturer, the ports should pursue the correct information post entry.)
1 this regulation defines textile and apparel products as any good classified in
Harmonized Tariff Schedule (HTS) Chapters 50-63 plus certain listed tariff numbers
outside this chapter range.
CBP contact: Jacqueline Sprungle (202) 344-2277
CBP TBT-05-029, dated 10/20/05, available at http://www.cbp.gov/linkhandler/cgov/import/textiles_and_quotas/tbts/TBT2005/tbt_05_029.ctt/tbt_05_029.doc