Our advice? Check with RIM first to avoid costly problems during and after the import transaction.
There are few surprises worse than costing out a product through the manufacturing, shipping and importation cycles and discovering retroactively that the calculation is rendered null and void by the imposition of antidumping or countervailing duties. These duties imposed by the United States government above and beyond the declared Customs duties can range from a few percentage points to one hundred percent or more of the entered value. Perhaps worst of all is that until the case has been settled, importers are potentially liable for even more duty than they deposited at the time of importation, not to mention the fact that they are having to post cash bonds or collateral for those additional duties.
Antidumping and countervailing duties are imposed when someone brings a complaint before the United States Department of Commerce that an imported product is being sold for less than fair market value, or “dumped”. The difference between the two is that antidumping is targeted at companies who price at less than fair market where countervailing takes into account foreign government subsidies of a product or industry. If a determination is made by Commerce that dumping is taking place, it is up to the International Commerce Commission to determine injury.
Coming through import data collected by Customs and Border Protection, both agencies give foreign manufacturers and domestic importers the chance to submit evidence of their pricing, bills of material, calculations of sale price and costs. When the ITC sets the rates, they will usually provide specific rates for respondents and then an “all-other” rate at a countrywide level. Usually the “all-other” rate is much higher and it is in the best interest of a foreign manufacturer to respond to an inquiry from the United States government.
At RIM, we work closely with importers on two activities that can prevent them from being financially hurt by importing ADD/CVD merchandise. First, we perform classification analysis and review prior to an importation to determine country of origin, classification and whether or not the item is at risk for falling into an existing ADD/CVD case. We then can consult existing scope rulings or write and request a ruling, that determines conclusively whether or not the imported product does or does not fall within the scope of the ADD/CVD case and those duties will be applied.
These regulations are complex. RIM’s compliance team have experience handling these across a variety of commodities and industries and are best equipped to help determine whether or not this will materially impact an importer’s supply chain. For more information on how to take steps to protect or remediate antidumping problems, contact us today.