On July 30, 2026, U.S. Customs and Border Protection (CBP) has officially released implementation guidance for Presidential Proclamation 11020. The following high-level updates modify our previous executive summary and action items:
1. Key Implementation Changes & Mandatory Chapter 99 Reporting
- Universal Reporting Requirement (Effective July 31, 2026): All importers of subject goods under HTSUS Chapters 29 and 30 must begin reporting an applicable Chapter 99 HTSUS classification starting July 31, 2026, regardless of company size or tariff effective date.
- Interim Zero-Duty Filing for Smaller Companies: Companies not listed in Annex III (whose duties do not take effect until September 29, 2026) must still file using the zero-duty HTSUS code 9903.04.61 for all entries between July 31, 2026, and September 28, 2026.
2. Updated Tariff Rates & Chapter 99 Classifications
CBP has assigned specific HTSUS Chapter 99 headings to each duty tier. Notably, the UK negotiated rate has now been explicitly defined:
- 100% Duty Rate (9903.04.60): Standard baseline rate for patented pharmaceutical articles and APIs (effective July 31, 2026, for Annex III companies).
- 0% Interim Rate (9903.04.61): Applies to all non-Annex III companies entering goods prior to September 29, 2026.
- 15% Preferential Rate (9903.04.62): Applies to qualifying imports originating from the EU, Japan, South Korea, Switzerland, and Liechtenstein.
- 10% UK Negotiated Rate (9903.04.63): Confirmed rate for patented pharmaceutical articles originating from the United Kingdom.
- 20% Onshoring Plan Rate (9903.04.64): Applies to companies with an approved onshoring plan. (Note: This rate is scheduled to increase to 100% on April 2, 2030).
3. Rule of Application
- Lowest Rate Rule: CBP confirmed that if a product qualifies for more than one rate under the Proclamation, the lowest applicable rate shall apply.
While smaller/non-Annex III companies do not face financial tariff impacts until September 29, 2026, customs entry reporting requirements change immediately on July 31, 2026. Importers and their brokers must ensure their systems are configured to declare the appropriate Chapter 99 HTSUS headings on all Chapter 29 and 30 entries to avoid rejection or audit scrutiny.
JSC Compliance will distribute updates and guidelines as soon as CBP releases final instructions.
For additional questions, please contact the JSC Compliance department.
