Whether repairing goods is the specialty of your business or you find your company in a situation where goods are shipped to your company for repair or refurbishment, it is important to understand the regulations surrounding these types of transactions.
In the Harmonized Tariff Schedule of the United States (HTSUS) there is a provision for these types of transactions under 9802.00.40 and 9802.00.50:
“Articles returned to the United States after having been exported to be advanced in value or improved in condition by any process of manufacture or other means:” – HTSUS
This number is an associated number. Meaning, this number is used in conjunction with the standard number. Each one of these numbers requires a value. The repair tariff number is 9802.00. with the original value of the goods, while the standard number would show the value of the repair performed. For example, a mold for plastics that was originally valued at $250,000 USD, but needed repairs not under warranty which cost $100,000 USD, would be shown as:
9802.00.5060 + 250,000 USD (Original Merchandise Value)
8480.71.8020 + 100,000 USD (Value of Repair Performed)
This structure allows for the reporting, but no duty assessment on the original value. The duty would be assessed on the value of the repair if either:
- The goods do not quality for USMCA
- The documentary requirements are not met
The documentary requirements are outlined in 19 CFR 10.8 and 19 CFR 181.64 are twofold:
- A declaration from the person who performed such repairs or alterations, in substantially the following form (must be completed by the company completing the repair)
- A declaration by the owner, importer, consignee, or agent having knowledge of the pertinent facts in substantially the following form (must be completed by the owner of the merchandise being repaired)
Therefore, to enter the goods in a compliant manner, both forms should accompany your Customs invoice when the shipment documents are sent for entry. Alternatively, you can add the statements shown in 19 CFR 181.64 (c)(i) and (ii) on the invoice, provided the proper parties have completed the relevant portions.
If you have any questions or concerns, please contact the Willson US Regulatory Team at 716.260.1580, option 4 or transitionus@willsonintl.com.