U.S. Customs and Border Protection (“CBP”) has announced that it will allow a 17-day grace period for the trade community to convert to the 2007 Harmonized Tariff Schedule of the United States (“HTSUS”).

Every 4 to 6 years the World Customs Organization (“WCO”) amends the Harmonized System. The 2007 HTSUS changes are significant and cannot be disregarded. 83 chapters of the HTSUS, and 240 headings have been altered, including changes in section and chapter notes. Numerous subheadings have been deleted or divided, creating new subheadings. Because of the substantial changes to the 2007 HTSUS, U.S. importers alerted CBP that additional time would be necessary to reclassify merchandise and update databases.

President Bush signed the proclamation on January 4, 2007, to implement the amendments made by the WCO, which will go into effect on February 3, 2007. The additional 17 days which CBP has granted the trade community to implement the WCO changes, will end at the close of business on Tuesday, February 20, 2007. The 2007 HTSUS will be fully enforced on entries submitted on or after February 21, 2007.

CBP stated, “The grace period will facilitate the transition to the 2007 HTSUS by allowing adequate time to address CBP actions such as the rejection of misclassified entries and will help to prevent the assessment of penalties under Title 19, United States Code, Sections 1592 and 1621 for negligence or non-egregious errors.” In addition, “Filers will be responsible for substantiating any additional time needed within the grace period for the late filing of entries and for making post-entry corrections.” Clients are reminded that it is the importer’s responsibility to properly classify its imported merchandise. It is strongly advised that all importers review their tariff classification databases during this transition period to verify if any of their merchandise has been affected by the changes in the 2007 HTSUS, and to use reasonable care in updating their tariff classifications to avoid errors when submitting entries to Customs. Failure to do so could result in penalty action.