On August 11, 2020, US Customs and Border Protection (CBP) published in the Federal Register a general notice [CBP Dec. 20-15] that notifies the public that, in light of the President’s Executive Order 13936 on Hong Kong Normalization, issued on July 14, 2020, suspending the application of section 201(a) of the United States-Hong Kong Policy Act of 1992 to the marking statute, section 304 of the Tariff Act of 1930 (19 U.S.C. 1304), with respect to imported goods produced in Hong Kong, such goods may no longer be marked to indicate “Hong Kong” as their origin, but must be marked to indicate “China.”
The new position is applicable as of July 29, 2020. However, a transition period of 45 days will be granted for importers to implement marking consistent with this position for imported goods produced in Hong Kong. Such goods, when entered or withdrawn from warehouse for consumption into the United States after September 25, 2020, must be marked to indicate that their origin is “China” for purposes of 19 U.S.C. 1304. Failure to mark an article in accordance with the requirements of 19 U.S.C. 1304 may result in the levy of a duty of ten percent ad valorem.
19 U.S.C. 1304 provides that, unless excepted, every article of foreign origin (or its container) imported into the United States shall be marked in a conspicuous place as legibly, indelibly, and permanently as the nature of the article (or its container) will permit, in such a manner as to indicate to the ultimate purchaser in the United States the English name of the country of origin of the article. 19 C.F.R. Part 134 implements the country of origin marking requirements and exceptions of 19 U.S.C. 1304.
On June 5, 1997, immediately prior to the handover from Great Britain to the People’s Republic of China (China), the US Customs Service (CBP’s predecessor agency) issued a Federal Register notice that goods produced in Hong Kong should continue to be marked to indicate their origin as “Hong Kong” under 19 U.S.C. 1304 after Hong Kong’s reversion to the sovereignty of China on July 1, 1997. See 62 FR 30927 (June 5, 1997). Today’s notice changes that position.
The tariff implications of this notice are not clear at this time and further guidance is expected on this issue.