On August 27, 2019, the U.S. International Trade Commission (ITC) published a final rule regarding the procedures for the preparation and filing of Miscellaneous Tariff Bill (MTB) petitions and public comments. The Miscellaneous Tariff Bill (MTB) Act temporarily reduces or eliminates import duties on specified raw materials and intermediate products used in manufacturing that are not produced or available domestically. It is intended to ensure that U.S. manufacturers are not at a disadvantage to their foreign competitors when sourcing manufacturing components. Under the MTB process, U.S. importers may petition for duty-free or reduced-duty treatment of certain imported products by submitting an MTB petition to the ITC. Typically, importers request duty relief for manufacturing raw material inputs such as chemicals, electronic goods, and proprietary parts that are not produced in the United States. However, there are no restrictions on what products and parts can be requested. In general, for an MTB petition to be successful there must not be any domestic industry opposition, and any reduction of duties resulting from the change to the duty rate for the proposed product breakout may not exceed $500,000 per annum. Importers can request an elimination or reduction of duties, depending on the annual duty savings anticipated and the $500,000 threshold.
The new rules take effect on September 26, 2019. It is anticipated that the ITC will begin accepting MTB petitions after October 15, 2019, and petitions must be filed within 60 days of this date. These dates will be confirmed after the ITC formally announces the commencement of the MTB petition process. Any successful petition would then need to pass Congress and be signed into law by the president before becoming effective. If signed into law, then the MTB petitions may become effective January 1, 2021, with an expiration date of December 31, 2024.
The new procedures appear more stringent than those applied during the 2016 round of MTB petitions. The petitions should include to the extent available: (1) CBP rulings issued on the product; and (2) a copy of other CBP documentation indicating where the article is classified in the HTS. Additionally, the petitions should include:
- an estimate of both total value and dutiable value for the product for the next five calendar years;
- an estimate of the share of total imports represented by the petitioner’s imports of the subject article;
- the names of any domestic producers of the article, if available;
- a certification of completeness and correctness; and
- an acknowledgement of the petitioner’s awareness that the information submitted is subject to ITC audit and verification.
The ITC has also indicated that there will be a clearer way to renew current MTBs. However, that information is not yet available