Special Bulletin · Action Required
In Effect Now: 12:01 a.m. ET, Friday, July 24, 2026
The Bottom Line
USTR announced final action on the evening of July 23, and Section 301 forced labor duties of 10% to 12.5% across 60 economies went live at 12:01 a.m. ET this morning, the same hour Section 122's global surcharge sunset. The floor did not fall; it moved to statutory ground with no rate cap and no expiration date. Relief is narrower than the headline suggests in some places and wider in others: in-transit cargo has a four-day window, USMCA-qualifying goods from Canada and Mexico are exempt, Section 232 goods are carved out entirely, and five economies get a ceiling rather than a stack. The next 96 hours are an entry-filing problem more than a duty-rate problem.
Do not model this as a flat overlay. CBP's guidance implements three distinct mechanics, and the third will catch people out.
1. Flat additional duty. For most economies the rate is simply added on top: China 12.5%, Vietnam 12.5%, India 10%, Brazil 12.5%.
2. Country-specific exemption headings. A dozen economies carry their own carve-out headings under 9903.05.93-9903.06.21, tied to subdivisions of U.S. Note 52: Argentina, Bangladesh, Cambodia, Ecuador, El Salvador, Guatemala, Indonesia, Jordan, Malaysia, Switzerland, Taiwan, the EU, and the UK. You cannot classify these from the country rate alone; you have to read the note.
3. The ceiling mechanism. This is the new one. For the EU, Japan, South Korea, Switzerland, and Taiwan, the duty is not additive. If the Column 1 rate already equals or exceeds the threshold (10% for the EU and Taiwan; 12.5% for Japan, Korea, and Switzerland), no additional duty applies at all. If Column 1 is below the threshold, the entry is assessed a combined Column 1 plus Section 301 rate equal to the threshold. A ceiling, not a stack. For high-duty lines out of Europe and Japan the practical impact may be zero, but only if you classify and file it correctly.
The rate does not track how much forced labor a country is presumed to have. It tracks whether that country adopted and enforces an import prohibition. That is why Australia, New Zealand, Norway, Singapore, Israel, Japan, and South Korea sit in the 12.5% tier while Bangladesh, Cambodia, and Pakistan sit at 10%. This is a tariff about legal architecture, not labor conditions, worth saying plainly to any client who reads the list and assumes otherwise.
Sources: CBP guidance to the trade, July 23, 2026 · Federal Register, forced-labor determinations and proposed action, June 5, 2026 · USTR final action notice, July 23, 2026
General exemptions apply across all 60 economies under headings 9903.05.85-9903.05.92:
USMCA (Canada and Mexico). Under 9903.05.93 and 9903.05.94, the additional duties do not apply to goods entered free of duty under USMCA, expressly including Chapter 98 subchapter XXIII and Chapter 99 subchapter XXII treatment, and expressly regardless of whether the good is entered under a provision showing "S or S+" in the Special sub-column. That last clause is deliberate and generous. Read it carefully.
CAFTA-DR textiles and apparel (9903.05.95). Textile and apparel goods from Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, or Nicaragua entered free of duty under CAFTA-DR are exempt. Guatemala and El Salvador have additional apparel headings (9903.06.06 and 9903.06.09); where a good qualifies under both, the importer may elect either heading.
What is not exempt: antidumping and countervailing duties, plus other duties, taxes, fees, and exactions, all continue to apply on top. This overlay displaces nothing.
Source: CBP guidance to the trade, July 23, 2026 (Chapter 99 headings and U.S. Note 52 subdivisions)
Reporting order on the entry summary line: (1) Chapter 98 if applicable; (2) Chapter 99 additional duties; (3) trade remedies in order: Section 301 first, then Section 122, then Section 232, then Section 201 duties, then Section 201 quota; (4) Chapter 99 replacement duty or other use; (5) other quota; (6) the Chapter 1-97 commodity classification. Entered value reports on the Chapter 1-97 line unless a Chapter 98 provision requires otherwise.
Foreign trade zones. Covered merchandise admitted on or after today may only be admitted as privileged foreign status under 19 C.F.R. 146.41, unless eligible for domestic status under 146.43, the same posture as the Section 232 actions, and a live trap for anyone with zone admissions scheduled this week.
Chapter 98. Broadly exempt where CBP agrees the provision applies, with the carve-outs at 9802.00.40, .50, .60, and .80. If you run assembly or repair programs, that is where the exposure hides.
Filing questions route to CBP's Trade Remedy Branch; entry summary errors route to your Client Representative or the ACE Help Desk.
Source: CBP guidance to the trade, July 23, 2026
Anyone waiting out the July 24 Section 122 sunset in hope of relief got their answer late last night. The replacement was staged, timed, and landed with the sunset to the hour. Section 301 carries no statutory rate ceiling and no 150-day clock, which is precisely why the bridge was built this way.
The biggest risk over the next 96 hours is not the rate. It is filing the entry wrong: wrong sequence, missed in-transit window, unclaimed USMCA exemption, or an FTZ admission in the wrong status.
It takes just 60 seconds to find out what Customs owes you. We’ll do the rest.
Caspian Trade, Inc.Refunds recovered. Compliance handled. Margins protected.
CBP-Approved ABI Vendor Platform. Licensed customs brokers.