The United States and Japan have achieved a trade agreement regarding market access for certain agricultural and industrial goods, with plans to pursue subsequent negotiations for an expanded free trade agreement. On October 07, 2019, the United States and Japan reached an agreement on market access for certain agriculture and industrial goods. The Japanese Legislature approved the agreement on December 5, 2019. Presidential Proclamation 9974 was issued on December 26, 2019 establishing an entry into force date of January 1, 2020. On December 30, 2019 the Federal Register Notice (84 FR 72187) was issued to implement the Agreement.
The United States will provide tariff elimination or reduction on 241 tariff lines. The affected agricultural products include perennial plants and cut flowers, persimmons, green tea, chewing gum, and soy sauce. The United States will also reduce or eliminate tariffs on certain industrial goods from Japan such as certain machine tools, fasteners, steam turbines, bicycles, bicycle parts, and musical instruments.
U.S. Customs and Border Protection (CBP) issued CSMS Message #41149692 on December 31, 2019. Additional compliance guidance will be made available as soon as possible.
In order to receive preferential treatment, a good must be originating and meet all the requirements of the U.S.-Japan Agreement.
Annex II to the Agreement specifies the rules of origin used to determine if a good qualifies for preferential tariff treatment or “originates” under the Agreement. The product-specific rules (Annex II to the Agreement) specify the level of change of tariff classification that non-originating materials must undergo. General Note 36 will be added to the HTSUS and will include the requirements of the Agreement. The links to the US-Japan Trade Agreement text and related documents are below.
Filing Instructions:
- From January 1, 2020 through January 13, 2020, importers must pay duties on qualifying goods under the Agreement and request a preferential tariff retroactive claim by filing a post summary correction (PSC) to request the duty refund. The Automated Commercial Environment (ACE) will accept the new special program indicator ‘JP’ as a prefix to the eligible tariff number on January 14, 2020.
- On or after January 14, 2020, ACE will accept the new special program indicator ‘JP’ as a prefix to the eligible tariff number. Importers claiming preferential treatment under the Agreement must include on the entry, the special program indicator “JP” as a prefix to the eligible tariff number for each qualifying good requesting such preference.
To claim preferential tariff treatment under the U.S.-Japan Trade Agreement, the following requirements must be met:
- Country of Origin must be ‘JP’
- Country of Export must be ‘JP’
- Once programmed in ACE, the Special Program indicator 'JP' must be placed before the eligible tariff number to make the claim.
- Claims for preferential treatment under this Agreement are not exempt from the merchandise processing fee (class code 499 and class code 311).
- The tariff-rate quota allocation for beef from Japan is modified as follows:
- The country specific Japan beef quota (200,000 kg) is eliminated and added to “other countries.” This updates the “other countries or areas” limit to 65,005,000 kg.
- There is no change to the entry filing process. The ACE quota module will process eligible beef from Japan under the “Other countries or areas” quota.