CE Customs & Tariff Classification Flashcards

What is antidumping duty (ADD) and when can it be imposed on U.S. exports to a foreign country?

Answer: A duty imposed by an importing country when foreign goods are sold below fair market value, injuring domestic industry

Antidumping duties are imposed when an exporter sells goods in a foreign market at prices below their home market value or below cost, harming the importing country's domestic producers.

What is a countervailing duty (CVD) and what triggers its imposition?

Answer: A duty applied to offset foreign government subsidies that give exported goods an unfair competitive advantage

Countervailing duties are imposed by an importing country to neutralize subsidies provided by foreign governments to their exporters, leveling the competitive playing field.

Under the U.S. de minimis rule (Section 321), what is the maximum value of goods that can enter the U.S. duty-free per shipment per day?

Answer: $800

Under Section 321, shipments valued at $800 or less may enter the United States duty-free and with minimal formal entry requirements, once per person per day.

What is a foreign trade zone (FTZ) and how does it benefit U.S. manufacturers that export goods?

Answer: A designated area where goods can be stored, manipulated, or manufactured without paying duties until entering U.S. commerce

FTZs allow manufacturers to import foreign components, process them, and pay duty only on the finished product when it enters U.S. commerce, or export without paying any duty.

What is the purpose of country-of-origin (COO) marking requirements on exported goods?

Answer: To inform the ultimate purchaser in the destination country of the country where the goods were produced

Country-of-origin marking, such as 'Made in USA,' informs consumers and customs authorities where goods were manufactured, which affects applicable duty rates and trade restrictions.

When goods undergo 'substantial transformation' in a second country, what is the key legal consequence for trade purposes?

Answer: The second country becomes the country of origin for tariff and trade regulation purposes

Substantial transformation means goods have been so significantly changed in a country that a new and different article emerges, making that country the new country of origin for customs and trade purposes.