By: Brian Walczyk, Compliance Manager, TradeInsights, LCB, CCS

The White House released an Executive Order detailing the new IEEPA Reciprocal tariff rates late yesterday, July 31^st, afternoon.

The order details how the rates will be enforced (new chapter 99 HTS numbers in Annex II), and that for any country not named in the order’s Annex I the rate would be 10%.

Named countries in Annex I range from 15% to 41%.

The EU did get a particular carve out in how their reciprocal tariff rate is handle, being an inclusive rate with the Most Favored Nations (MFN) and Reciprocal not to exceed 15%. If the MFN is greater than 15%, for the EU, then no additional reciprocal would be applied. The EU is the only set of countries listed to have the reciprocal tariffs treated this way.

The Annex I rates take effect on 12:01 a.m. EST on August 7^th for goods entered for consumption, or withdrawn from warehouse for consumption.

There is an in-transit exemption where the 10%, current rate, is applicable if the goods are loaded to the “mother” vessel before August 7^th and entered for consumption before October 5^th.

The order further explains that any good that CBP determines to have transshipped to avoid the reciprocal tariffs will be subject to a 40% rate in addition to the MFN rate and any applicable fine or penalty associated to the evasion.

We will continue to monitor the situation and provide updates as they become available. Please contact your V. Alexander account team, or you may also contact our Trade Compliance team at tradeinsights@valexander.com with any questions, and you can always follow us on our website www.valexander.com for updates on this and other topics.