Are Your Imports Covered by Antidumping or Countervailing Duty Orders?
An antidumping or countervailing duties are imposed on imports. As an importer, the first practical question is whether your imported products are covered by the antidumping or countervailing duty order. Often, this is not a simple question. The scope of the order generally provides a narrative description of the products subject to the duties. The problem is that it is not always straightforward and does not necessarily encompass expressly every type of product or any future type of products in the same family. Importing products without being certain that there are not subject to the higher tariffs is fraught with risks because the Customs and Border Protection Office (“CBP”) could request the payment of duties and suspend the liquidation of the entry concerned. In recent years, CBP has heightened scrutiny of Chinese imports at U.S. ports to ascertain whether they are within the scope of an order and ensure that they are not evading antidumping or countervailing duties.
Here are some questions that we hear most frequently from importers:
1. Are the products excluded if they do not fall under the tariff subheading?
Along with a written description, the scope of the order lists the tariff subheading codes for the goods covered. However, the mere fact that a product falls outside the tariff subheading listed in the scope does not mean that the product is excluded from antidumping or countervailing duties. It is the narrative description of the scope that controls whether a product is covered by the scope on an order. Thus, there are instances where a product that is not covered by a tariff subheading associated with an order is still subject to the special duties.
2. Does the scope cover unassembled goods?
A question frequently asked is whether a product that is unassembled, or partially assembled or in an intermediary stage of production, is included in a scope. The answer depends upon the language used in the scope. Generally, they are excluded unless the scope clearly includes them or the intermediary product has already all the essential characteristics of the product covered by the scope.
3. Does the scope cover kits?
What about a product that is imported as part of another product or kit? The answer once again depends upon the facts in each case. This is a determination that has to be made in light of the scope description and precedents by the U.S. Department of Commerce (“DOC”). Generally, products included as a part of a kit with other products are covered unless the scope clearly excludes them or there has been a specific DOC decision excluding such kits.
The recommended course of action in all instances in which it is not clear whether a product falls within the scope of an order is to file a formal scope ruling request with the DOC. The DOC is required to rule on such issues as quickly as possible. For simple issues, the process may take 4 to 6 months. This formal ruling will put to rest any questions relating to the imported merchandise and ensure that your future business will go smoothly without unpleasant surprises.