Generalized System of Preferences (GSP) Set to Expire December 31, 2017Generalized System of Preferences (GSP) Set to Expire December
- December 18, 2017
The expiration of Generalized System of Preferences (GSP) is right around the corner! Assuming the program expires, the products once eligible for being duty-free under special program indicators “A”, “A+”, and “A*” will now be subject to normal duty rates when imported. While CBP still requests that GSP eligible items are identified with an indicator, the goods will become dutiable until further notice.
To ensure importers receive duty refunds upon GSP renewal, Shapiro will continue to flag GSP-eligible importations with the SPI “A,” even as we pay normal trade relations (column 1) duty rates on your behalf on otherwise GSP-eligible importations. Please also note the following:
- CBP is working to have programming in place that will allow CBP to automate the duty refund process, in the event that GSP is renewed with a retroactive refund clause.
- CBP will continue to allow post-importation GSP claims made via post summary correction (PSC) and protest (19 USC 1514, 19 CFR 174) after the expiration of GSP, for importations made while GSP was still in effect.
- CBP will not allow post-importation GSP claims made via PSC or protest after the expiration of GSP, for importations made subsequent to expiration.
- The pending expiration of GSP does not affect goods entered with African Growth and Opportunity Act (AGOA) preference. Effective January 1, 2017, the Harmonized Tariff Schedule of the United States (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 any lapse in GSP.
That doesn’t mean GSP won’t be back! This program has been around since 1976 and will likely be reinstated in the future. The current placement of GSP began in July of 2015 after a two-year window with no GSP. The countries and products eligible for GSP may be reevaluated so there is a possibility that your current country of origin may no longer qualify.
Shapiro will continue to monitor the situation and provide updates as they become available.