CBP Adds More Data Requirements for Vehicles Seeking Preferential Treatment Under USMCA
CBP will be requiring producers of automotive parts and vehicles to supply more data elements to prove that these goods are eligible for preferential tariff treatment under the trade agreement between the U.S., Mexico and Canada, according to an interim final rule released Jan. 16.
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These additional data elements will "ensure that CBP has all the information needed to establish that the producer meets the [labor value content] LVC, steel purchasing, and aluminum purchasing requirements" of the USMCA, CBP said.
The interim final rule governing preferential tariff treatment under USMCA is effective March 18, although CBP is also taking comments on the interim final rule through then.
In a Jan. 16 cargo systems message summarizing highlights of the interim final rule, CBP noted that these additional data elements are for vehicles that have been deemed eligible for USMCA preferential treatment. The producer of these vehicles must certify to CBP that the production of the vehicle by the producer meets the LVC requirement, the steel purchasing requirement and the aluminum purchasing requirement.
The data elements for steel purchasing and aluminum purchasing certifications are: any Manufacturers Identification Code, Federal Employer Identification Number, or Importer of Record number associated with the producer; the vehicle category for which the steel or aluminum purchases are calculated; and the name and address for each steel or aluminum producer, service center, or distributor relied upon in calculating the total value of purchases of steel or aluminum that qualify as originating goods, according to CBP.
The LVC certification data elements include the name, title and contact information of the rectifier or the person completing the LVC certification; the LVC calculation used to determine that the production of the covered vehicles meets the LVC requirement; and the authorized certifier’s signature, date signed, and certifying statement.
The interim final rule says that, starting on May 17, the producer of the covered vehicle must submit the LVC, steel purchasing, and aluminum purchasing certifications to CBP at least 90 days prior to the beginning of the certification period, and those certifications must include those additional data elements, according to CBP's CSMS message.
In addition to discussing plans to add data elements to the various vehicle certifications, the interim final rule also seeks to clarify that originating goods and textile or apparel goods subject to a tariff preference level are exempt from the merchandise processing fees.
"As goods subject to TPLs are not originating goods, the certification of origin requirement does not apply for textile or apparel goods subject to a TPL claiming USMCA preferential tariff treatment," CBP said in the Jan. 16 CSMS message.
Instead, "the USMCA country where the good is being imported may require a document issued by the competent authority of a USMCA country, such as a certificate of eligibility, to provide information demonstrating that the good qualifies for duty-free treatment under a TPL, to track allocation and use of a TPL, or as a condition to grant duty-free treatment to the good under a TPL."
TPLs under the USMCA will be administered using a certificate of eligibility, CBP said in the CSMS message. "Thus, CBP is adding the TPL requirements, including the requirements for the certificate of eligibility."
CBP also seeks to revise regulations for drawback and duty-deferral programs to align them with subsequent policy determinations. This includes adding language about persons who are entitled to receive drawback and about the collection and waiver or reduction of duty under duty-deferral programs.
Other changes include a revision allowing an international traffic container to remain in international traffic. Currently, if a container doesn't exit the U.S. within 365 days, it is considered as no longer used for international traffic. The revision allows for an extension beyond that 365-day period, and that extension request must be made in ACE.
The interim final rule also includes modifications pertaining to the bonds issued when a professional organization in the U.S., Mexico or Canada brings in professional equipment that will be used temporarily and is for the purposes of carrying out a business activity, such as for sports purposes or for display or demonstration.
The interim final rule also addresses when a vehicle is temporarily imported by an operator for repair or alteration.
Overall, the interim rule seeks to amend existing provisions, as well as add new provisions, to the following: general definitions; drawback and duty deferral programs; temporary admission of goods provisions; product-specific rules of origin for automotive goods; recordkeeping requirements for importers, exporters and producers; USMCA general origin verification requirements and procedures; determination of origin provision; advance rulings requirements; review and appeal of determinations of origin and advance rulings provisions; product-specific rules of origin for textiles and apparel goods; and provisions related to customs administration and trade, according to the Federal Register notice.