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On March 30, 2012, the Senate Finance Committee and the House Ways and Means Committee announced the time frame and requirements for Members of Congress to introduce bills to be included in the Miscellaneous Tariff Bill (MTB). MTBs offer importers an opportunity to save substantial amounts in customs duties for as long as three years. In order to qualify for a duty suspension or reduction, a proposed tariff modification must: (i) be non-controversial (i.e., not generate an objection from another Member or a domestic producer), (ii) cost under $500,000 per year in loss of revenue to the US Treasury, and (iii) be administrable by US Customs and Border Protection.

In order to be included in the MTB, a bill must be:

  • A new temporary duty suspension or duty reduction on one product or item;
  • An extension of an existing temporary duty suspension or duty reduction on one product or item; or
  • A technical correction.

A duty suspension occurs when the duty rate is temporarily reduced to zero, whereas a duty reduction occurs when a duty rate is temporarily reduced but remains greater than zero.

After individual MTBs are introduced, they will undergo a vetting process that includes posting for public comment, an assessment by the Congressional Budget Office of the potential revenue loss, and a review by the Department of Commerce, the International Trade Commission, and other government agencies. All individual bills that are approved through the vetting process will be aggregated into a single bill which must be passed by Congress. The most recently passed MTB included duty suspensions and reductions on more than 700 products covering a wide range of industries.

The deadline to submit individual tariff suspension bills is April 30, 2012. The MTB process is an opportunity for companies that imports goods to potentially reduce their import duty burden.

In addition, current duty suspensions in effect under the previous MTB expire on December 31, 2012. Any importer currently benefitting from these duty suspensions must work with Congress to introduce a new bill extending the duty suspension under the new MTB.

In order to ensure that it qualifies for the MTB, an importer must:

  • Review its imported products to make sure that they are eligible for a duty suspension under the MTB;
  • Work closely with the US Senate and/or staff in crafting the individual suspension bill for its products; and
  • Communicate with the International Trade Commission, the Department of Commerce, and Customs and Border Protection to address any issues arising from the review process.

For more information about the MTB process or any other matter raised in this Legal Update, please contact Sydney H. Mintzer or Tiffany Smith.

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