Caspian is hosting an invitation-only dinner series bringing together customs, trade, and supply chain leaders for candid conversations on the issues shaping global trade today.
We'll be in the NYC and Philly areas in late August and Texas in early September. We're still mapping out the rest of our fall schedule. Let us know what city we should visit next!
The Bottom Line
Three trade developments caught our attention this week. Section 232 tariffs on patented pharmaceuticals took effect. Imports from companies named in Annex III of Proclamation 11020 now carry rates as high as 100%. The U.K. is the exception at 0%. DHS also added 43 companies to the UFLPA Entity List, putting any importer with ties to them at risk of detention.
Section 232 tariffs on patented pharmaceuticals and their ingredients took effect July 31. Imports from companies listed in Annex III of Proclamation 11020 now face combined duties of up to 100% under heading 9903.04.60.
The rate depends on the country. The U.K. moved to 0% after its pricing agreement with the U.S. Imports from the European Union, Japan, South Korea, and Switzerland remain at 15%. All other covered companies continue under the temporary zero-duty provision at 9903.04.61 until September 29, when their applicable rates begin. CBP's guidance to the trade carries the full rate table.
Unlike the February Section 122 surcharge, these Section 232 duties are eligible for drawback. Importers exporting finished pharmaceuticals or re-exporting ingredients may be able to recover duties paid at entry, but the claim depends on having the right records. Keep entry and export records tied together from the first shipment!
All Chapter 29 and 30 pharmaceutical entries must now report one of the new 9903.04 headings, even when no duty is owed. Generic drugs, their ingredients, and products of U.S. origin are excluded.
Sources: CBP guidance to the trade, CSMS #69395344, Proclamation 11020, 91 FR 18183
The U.K.'s patented pharmaceutical tariff dropped from 10% to 0% on July 31 after both governments reached a pricing agreement. CBP updated ACE under heading 9903.04.63.
Other countries currently at 15% could follow a similar path if agreements are finalized. For importers, the takeaway is simple: tariff rates are not always static. Landed cost models should account for potential changes.
Sources: Commerce notice, 91 FR 49406, CSMS #69415934
DHS added 43 companies to the Uyghur Forced Labor Prevention Act Entity List on August 3. Goods tied to those entities are now subject to a rebuttable presumption that they were made with forced labor. CBP can detain a shipment until the importer overcomes that presumption with evidence. Two of the 43 companies appear on two separate sub-lists, and two existing entries were corrected.
The risk extends beyond direct suppliers. If materials in your supply chain trace back to a listed entity, CBP can apply the presumption even if that company is not on your invoice. Review the 43 new names against your vendor and sub-tier supplier records this week.
Source: DHS notice, 91 FR 48913
Van-type trailers: Commerce issued preliminary antidumping findings on van-type trailers from Canada and Mexico and extended provisional measures. Cash deposits now apply where required. USMCA origin does not exempt goods from antidumping duties. (Canada 91 FR 49407, Mexico 91 FR 49416)
Linear hydraulic cylinders: The ITC opened AD/CVD investigations covering imports from Canada, China, India, Mexico, and South Korea. No duties are owed yet; the preliminary vote is scheduled for September 14. (91 FR 49442)
Review your pharmaceutical classifications
Pull your Chapter 29 and 30 entries and match each one to the correct 9903.04 heading. Start with the Annex III companies, which can reach a 100% duty
Screen suppliers against the updated Entity List
Check your direct vendors and sub-tiers before your next shipment
Establish the drawback process now
These duties may be recoverable, but the claim depends on having entry and export records that line up
Model your exposure for September 29
If the temporary zero-duty provision is what you currently file under, calculate landed cost at your real rate before it ends
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