“We just shipped 252 handmade Rwanda baskets to the US but on arrival we were charged duty. The US customs official in Dallas Airport Texas advised us that the AGOA agreement for items coming from Rwanda was cancelled on 31st December 2017. Is this true?
I looked into the data on the USITC website and there has been both GSP and AGOA trade recorded from all Hub supported countries (including Rwanda) since January 1, 2018.
I would double check with the customs person. GSP expired on December 31, 2017, but even in that case the traditional practice has been to pay the tariff (while continuing to claim GSP in the customs paperwork). After GSP is renewed, the exporter will receive retroactive credit.
In any case, if it is an AGOA eligible product is unaffected by GSP's temporary expiration per the below.
African Growth and Opportunity Act (AGOA)
The expiration of GSP has no effect on goods entered under the African Growth and Opportunity Act (AGOA). Effective January 1, 2017, the Harmonized Tariff Schedule of the United Sates (HTSUS) was modified so that all non-textile, AGOA-eligible tariff items indicate SPI “D” in the “Special” column. As such, since January 1, 2017, all non-textile AGOA claims have been made using the SPI “D”. AGOA preference remains in effect through September 30, 2025, irrespective of the expiration of GSP.
(a) Supporting information to show Customs that Baskets are AGOA eligible
Refer to the current US Harmonized Tariff System (USHTS) online version see --https://hts.usitc.gov/current and look up Chapter 46 which deals with plaited goods, baskets and wickerwork.
Look for the section which best describes your product (most likely under 4602 .19. xx) and refer to the "Special" duty column where you will see the special program indicator (SPI) codes.
You will note that normal duty under Chapter 46 ranges from free (0%) to 10%, but that baskets are eligible for preferential tariffs under several SPI codes. The baskets are duty free under both GSP (SPI code "A") and AGOA (SPI code "D").
You can have your Customs broker show this to the Customs Officers as proof that that baskets are also eligible under AGOA, despite GSP having expired. I attach a pdf copy of Chapter 46 for ease of reference but it is best to use the online version as the tariffs change from time to time. This, together with a valid certificate of origin, will help to justify duty free entry.
(b) Documents where the SPI is indicated
In terms of where the SPI is used, it is inserted in field 27 in the US Customs Entry document called CBP form 7501. For ease of reference, refer to the check list for documentation of exports to US and a blank CBP form 7501, also attached. Your Customs Broker will know how to fill it out but as an exporter you should generally be familiar with the form and the meaning some of the information codes therein.
The Special Program Indicator indicates the importer desires to claim preferential duty rates for qualifying goods. Duty rates are charged based on the SPI indicated and the justification of why the product is eligible for the special treatment- which is provided mainly in the certificate of origin which accompanies the goods. Note that exporters are required to keep the records justifying eligibility of goods shipped, for a period of up to 5 years. Exporters should present these supporting records to US Customs if requested to do so.
(C) Whether to pay duty or attempt to claim reimbursement when GSP reinstated
This depends on how much duty is at stake and how much it will cost you to get the paperwork sorted out quickly. I suggest you get your US customs broker to advice.
The Customs and Border Protection Website is a useful resource -- so see link: