Section 232 Exclusions: New Threshold for Deactivation
Importers who have an exclusion to Section 232 import duties on steel and aluminum imports granted by the Bureau of Industry and Security (BIS) should be aware of the new threshold for deactivating a Section 232 exclusion.
On January 5, 2024, U.S. Customs and Border Protection (CBP) issued Cargo Systems Messaging Service (CSMS) # 58942510 - GUIDANCE: New Threshold for Deactivating Section 232 Exclusions.
Effective February 15, 2024, CBP will deactivate particular Section 232 exclusions on a weekly basis when the imported quantity for each exclusion is greater than or equal to 95 percent of the allocated quantity. Previously, exclusions have been deactivated when the imported quantity reached or exceeded 100 percent.
The new threshold is implemented following a report on tariffs indicating importers have been improperly importing goods inexcess of the granted Section 232 exclusion amounts, which has resulted in over $29 million of Section 232 duties owed by these importers.
Section 232 Exclusions to be Deactivated at the 95 percent threshold:
- Exclusions for non-quota countries, i.e. those subject to Section 232 duties;
- Exclusions for European Union (EU) countries that are subject to Section 232 steel tariff rate quotas (TRQs) and
- Exclusions valid for multiple countries subject to both Section 232 duties and any quotas.
What if my Exclusion is Deactivated?
When Section 232 exclusions are deactivated, importers will no longer be able to use the Section 232 exclusions on new entry summaries and will have to deposit the appropriate Section 232 duties on any new entry summaries. When certain exclusions are deactivated at less than 100 percent of the quantity, importers can choose to file a Post Summary Correction (PSC) to claim the remaining exclusion amounts and request a refund of any Section 232 duties paid.
For exclusions that are valid for multiple countries subject to both Section 232 duties and quotas, and that are deactivated at less than 100 percent of the allocated quantity, importers can only file a PSC for the Section 232 duty countries, or the EU steel tariff rate quotas, to claim the remaining exclusion quantity amounts.
All other Section 232 exclusions will remain at the 100 percent threshold for deactivation. These other exclusions cannot be deactivated at less than 100 percent because importers are not able to use a PSC in ACE to claim the remaining exclusion amounts.
Importers should be tracking their exclusion usage. Contact your local customs broker with any questions or concerns on Section 232 exclusion deactivation.