Trade Tariffs : Legal Strategy and Compliance in New York

The HTS is a comprehensive classification system maintained by the U.S. International Trade Commission (USITC) that assigns every traded product a specific code. The first six digits align with the international Harmonized System, while digits seven through ten are unique to U.S. Tariff law. Duty rates vary dramatically depending on the code assigned; two similar products may face vastly different tariff burdens based on subtle differences in composition or intended use. New York importers must work with customs brokers and trade attorneys to ensure accurate classification and to obtain advance rulings from CBP when product classifications are uncertain or novel.

Even after determining the correct HTS code, the applicable duty rate depends on the country of origin of the goods. Certain countries qualify for preferential trade agreements such as the United States-Mexico-Canada Agreement (USMCA), which can reduce or eliminate tariffs on qualifying goods. Other products may be eligible for the Generalized System of Preferences (GSP) or other special trade programs. Claiming these benefits requires proper documentation, including certificates of origin and compliance with content and processing requirements. Failure to qualify for available preferences means paying full, non-preferential tariff rates, significantly increasing import costs.

When the Commerce Department initiates an antidumping or countervailing duty investigation, U.S. Importers, manufacturers, and trade associations have the right to submit comments, provide information, and participate in public hearings. This participation can influence the preliminary and final determinations that ultimately set duty rates. Companies that fail to engage in these proceedings may find themselves bound by unfavorable duty rates for years. An experienced trade attorney can help your company prepare substantive comments, gather supporting documentation, and present arguments that protect your commercial interests during these critical investigations.

If the Commerce Department or USITC issues a determination that you believe is incorrect, you have the right to challenge it through administrative and judicial review. The U.S. Court of International Trade (CIT) has exclusive jurisdiction over these disputes and applies a specialized body of law governing trade remedy cases. Appeals to the CIT must be filed within specific statutory timeframes and require detailed legal arguments supported by the administrative record. Many companies have successfully reduced or eliminated duties through CIT litigation, recovering millions of dollars in overpaid tariffs and obtaining prospective duty relief.

CBP requires detailed entry documentation for every shipment of imported goods, including commercial invoices, packing lists, bills of lading, and certificates of origin. The declared value of the goods must reflect the actual transaction price paid or payable, adjusted for certain additions and deductions specified in 19 U.S.C. § 1401a. Undervaluation(whether intentional or due to error) is a common violation that triggers duty assessments, penalties, and potential criminal referrals in egregious cases. Companies must establish internal procedures to ensure that declared values are accurate and supported by contemporaneous documentation that CBP can review upon audit.

When CBP selects your company for an audit, you have the opportunity to provide documentation and explanations that support your compliance. An effective audit defense requires organized record-keeping, clear communication with CBP, and strategic legal counsel. If CBP identifies violations, you may be able to negotiate penalty mitigation through the CBP Penalty Mitigation Program, which can reduce assessed penalties significantly if you can demonstrate reasonable care and cooperation. 

Companies that proactively engage with CBP and retain experienced customs counsel often achieve favorable audit outcomes and avoid the maximum penalties that CBP is authorized to assess.

Many companies can reduce tariff burden by restructuring their supply chains to take advantage of trade preference programs, rules of origin, and special tariff provisions. For example, products manufactured in certain countries may qualify for preferential tariff treatment, or components sourced from particular regions may enable a finished product to qualify for lower rates under trade agreements. 

These optimization strategies require careful analysis of manufacturing processes, sourcing decisions, and the specific requirements of applicable trade programs. A comprehensive tariff optimization review can identify opportunities to reduce costs while maintaining supply chain efficiency and product quality.