On April 26, 2021, the U.S. Trade Representative (USTR) published a notice in the Federal Register correcting a very narrow technical issue affecting certain merchandise covered by certain China Section 301 List 3 product exclusions. 

As background, on September 24, 2018, the USTR imposed a 10% duty on China-origin merchandise provided on List 3.  On May 10, 2019, this 10% duty was increased to 25%, but certain List 3 merchandise exported from China before May 10, 2019 and entered into the United States before June 15, 2019 remained subject to the lower 10% duty.  To differentiate between merchandise exported and entered within this period and subject to the lower 10% duty rate, the USTR created a unique HTSUS subheading 9903.88.09 classification for this merchandise.  However, when issuing the various rounds of China Section 301 List 3 product exclusions between August 2019 and May 2020, the USTR failed to provide for merchandise subject to the lower 10% duty rate under HTSUS subheading 9903.88.09. 

The USTR notice corrects this issue by clarifying that merchandise covered by a China Section 301 List 3 product exclusion is not subject to China Section 301 List 3 duties if it was exported before May 15, 2019 and entered before June 15, 2019 under HTSUS subheading 9903.88.09.   

Please contact Marshall Miller, Brian Murphy, or Sean Murray with questions or for assistance.