Many EU businesses are grappling with the question of how they can reduce the cost of customs duty on imports of US origin jeans. This follows the announcement that an ADDITIONAL rate of duty of 26% plus the existing 12% (for jeans) will apply as a result of EU retaliatory action in relation to the Byrd Agreement. Basically the EU is able to protect EU businesses by imposing such duties to counteract perceived illegal subsidies given to US businesses. This is effective from 1 May 2013 and also affects the following goods:
– Sweetcorn (uncooked or cooked by steaming, boiling in water, frozen)
– Crane lorries
– Frames and mountings for spectacles or goggles, made from base metal
Depending on the supply chain and commercial set up, there is a range of customs duty reliefs available to businesses to mitigate this customs duty cost. For example if the fabric originates in the EU, its value can be stripped out from the reimported value post manufacturing in certain circumstances. Similarly where lengthy supply chains are in place it may be possible to use the First Sale for Export valuation structure.
For more information on this please contact Julie Park on +44 208 941 9200