U.S. Customs and Border Protection (CBP) provided and update on the implementation of Presidential Proclamations imposing Section 338 additional duties on certain Canadian imports. These duties are designed to offset Canadian discrimination against U.S. commerce regarding alcoholic beverages, dairy, and motor vehicles.
After a brief temporary suspension period, the new duties take effect for affected goods entered for consumption, or withdrawn from a warehouse for consumption, on or after 12:01 a.m. EST on August 22, 2026.
The guidance outlines specific Harmonized Tariff Schedule of the United States (HTSUS) headings for Canadian products:
- 50% Additional Duty: Applies to articles falling under HTSUS headings 9903.03.12, 9903.03.13, and 9903.03.14.
- 0% Additional Duty: Applies to specific exclusions such as aluminum, steel, passenger and heavy-duty vehicles, wood products, semiconductors, pharmaceuticals (9903.03.15), and civil aircraft components (9903.03.16).
- These additional duties are applied on top of any existing antidumping, countervailing, or other standard duties and fees.
Procedural Directives & Exceptions
- Chapter 98 Exceptions: The additional duty generally does not apply to goods correctly entered under Chapter 98 provisions. However, for specific subheadings (e.g., items repaired, altered, or assembled abroad), the 50% duty applies to the value of the repair, alteration, or foreign assembly.
- Foreign Trade Zones (FTZ): Affected goods entering an FTZ must be admitted as “privileged foreign status” (unless eligible for “domestic status”) and will face the additional duties upon entry for consumption.
- Drawback: The additional duties (headings 9903.04.12 to 9903.04.14) are eligible for drawback.
- HTSUS Sequencing: Please note the trade is pending additional guidance on the required on the sequencing of the 338 Trade Remedy.
The CBP update may be found here.
The full list of impacted HTS may be found here.
Previous update regarding Section 338 may be found here.
If you have any questions, please email the JSC Compliance Department.
