Implementation
Guidance on the US-Japan Agreement and Modification of Duties on Imports from Japan
Executive
Order 14345 and its implementation guidance on the U.S.–Japan Agreement (Sept 2025):
·
Executive
Order (EO) 14345
(signed Sept 4, 2025) implements the U.S.–Japan
framework agreement announced in July 2025.
·
Issued
under IEEPA
and Section 232 of the
Trade Expansion Act (1962).
·
Establishes
a baseline 15% tariff
on nearly all Japanese imports, with special provisions for autos, auto parts, and aerospace
products.
·
Commerce
issued implementing notice with Harmonized Tariff Schedule (HTSUS) changes
(published Sept 16, 2025).
·
If
Column 1 duty rate ≥ 15% → no
additional tariff (HTSUS 9903.02.72).
·
If
Column 1 duty rate < 15% → tariff increased to 15% total (HTSUS
9903.02.73).
·
Effective
for goods entered/withdrawn on or after Aug
7, 2025.
·
Filers
must use new HTSUS codes 9903.02.72/73 (effective Sept 16, 2025).
·
Japanese
civil aircraft (under WTO Agreement on Trade in Civil Aircraft), except unmanned aircraft, are
exempt from additional tariffs on aluminum, steel,
copper, and reciprocal duties.
·
Use
HTSUS 9903.96.02
(duty-free).
·
Tariffs
based on Column 1 duty rate:
o If ≥ 15% → no extra duty
(HTSUS 9903.94.40 for autos, 9903.94.42 for parts).
o If < 15% → total duty = 15%
(HTSUS 9903.94.41 for autos, 9903.94.43 for parts).
·
Applies
to entries on or after Sept
16, 2025.
·
Subject
to “stacking” provisions of EO 14289 & Proclamation 10947 (re aluminum/steel tariffs).
·
Aluminum, steel, copper, and auto/auto parts under
earlier Section 232 proclamations remain exempt from reciprocal tariffs.
·
File
under HTSUS 9903.01.33.
·
Reciprocal
tariff exemptions under headings 9903.01.25, 9903.01.30–34 still apply.
Order
of reporting multiple HTS codes on entries:
1.
Ch. 98
subheading (if any).
2.
Ch. 99
for additional duties.
3.
Trade
remedies (301 → IEEPA fentanyl → IEEPA reciprocal → Section
232/201).
4.
Replacement
duty (e.g., MTB).
5.
Other
quota duties.
6.
Ch.
1–97 for commodity tariff.
·
Retroactive
to Aug 7, 2025
(reciprocal tariffs).
·
Full
implementation (new HTS codes) effective Sept
16, 2025.
Bottom
Line: The
U.S.–Japan agreement equalizes tariffs at a baseline 15%, removes some aerospace
products from extra duties, modifies auto/auto parts duties, and clarifies
filing rules. It consolidates Japan’s treatment under both reciprocal tariffs
and Section 232 measures.
Executive
Order 14345, “Implementing the United States-Japan Agreement” (EO 14345) signed
on September 4, 2025, was issued pursuant to the International Emergency
Economic Powers Act (IEEPA) and Section 232 of the Trade Expansion Act of 1962
(Section 232). The Executive Order
orders modifications to the IEEPA and Section 232 tariffs applicable to
imported articles of Japan to implement the framework agreement between the
United States and Japan (Agreement) announced by the President in July of
2025. As explained in the Executive
Order, under the Agreement, the United States will apply a baseline 15 percent
tariff on nearly all Japanese imports entering the United States, alongside
separate sector-specific treatment for automobiles and automobile parts and
aerospace products.
Specifically,
EO 14345 modifies the additional rates of duty applicable to products of Japan
set forth in the following five previous presidential actions:
1.
Executive
Order 14257 of April 2, 2025 (Regulating Imports with a Reciprocal Tariff to
Rectify Trade Practices that Contribute to Large and Persistent Annual United
States Goods Trade Deficits), as amended;
2.
Proclamation
10908 of March 26, 2025, (Adjusting Imports of Automobiles and Automobile Parts
Into the United States), as amended;
3.
Proclamation
9704 of March 18, 2018 (Adjusting Imports of Aluminum
Into the United States), as amended;
4.
Proclamation
9705 of March 8, 2018 (Adjusting Imports of Steel Into
the United States), as amended;
5.
Proclamation
10962 of July 30, 2025 (Adjusting Imports of Copper Into
the United States), as amended.
EO 14345
required the Secretary of Commerce (Commerce) to publish a notice in the Federal
Register to make the necessary modifications to the Harmonized Tariff
Schedule of the United States (HTSUS) as necessary and appropriate to
effectuate the EO. On September 15,
2025, Commerce posted the implementing notice, Implementing Certain
Tariff-Related Elements of the United States-Japan Agreement, with the relevant
HTSUS modifications for public inspection on the Federal Register’s
website, with a scheduled publication date of September 16, 2025. This updated guidance is based on the HTSUS
modifications announced by Commerce in the notice implementing EO 14345 as
posted for public inspection on September 15, 2025 and scheduled for
publication in the Federal Register on September 16, 2025.
GUIDANCE
APPLICATION
OF MODIFIED DUTY RATES
General
Reciprocal Tariff
The
reciprocal tariff for products of Japan is dependent on the Column 1 ad valorem
or ad valorem equivalent duty rate applicable to the products.
·
For a
product of Japan with a Column 1 duty rate greater than or equal to 15 percent,
the additional reciprocal tariff is zero (0). Use HTSUS heading 9903.02.72.
·
For a
product of Japan with a Column 1 duty rate less than 15 percent, the sum of the
Column 1 and the reciprocal tariff rate is 15 percent. Use HTSUS heading
9903.02.73.
When
submitting an entry summary to claim the 15 percent ad valorem duty rate on
products of Japan, file using 9903.02.73 followed by the appropriate
classification under Chapter 1 to 97, HTSUS. ACE will replace the duty reported
for these two HTSUS classifications with the 15 percent duty rate.
Consistent
with U.S. note 2(v)(xv) to subchapter III of chapter 99 of the HTSUS, as
modified by Commerce in the notice implementing EO 14345 as posted for public
inspection on September 15, 2025 and scheduled for publication in the Federal
Register on September 16, 2025, for any product of Japan subject to a specific
or compound rate of duty under column 1-General, the ad valorem equivalent rate
of duty of such product shall be determined by dividing the amount of duty
payable under column 1-General by the customs value of the product. For
example, if a product were subject to a specific duty of 50 cents per kilogram,
and one kilogram of the product were entered with a customs value of $10, then
the ad valorem equivalent rate of duty would be obtained by dividing 50 cents
by $10, yielding 5 percent.
The above
action applies to products of Japan entered for consumption, or withdrawn from
warehouse for consumption, on or after 12:01 a.m. eastern daylight time on
August 7, 2025. As of September 16, 2025, heading 9903.02.30 will no longer be
available for use in the Automated Commercial Environment (ACE) for entries of
products of Japan that are entered for consumption, or withdrawn from warehouse
for consumption, on or after 12:01 a.m. eastern daylight time on September 16,
2025.
New HTSUS
headings 9903.02.72 and 9903.02.73 will be deployed in ACE at 12:01 a.m.
eastern daylight time on September 16, 2025, on the date that Commerce’s notice
with the HTSUS modifications implementing EO 14345 will be published in the
Federal Register. As an update to the guidance issued through CSMS 66146676
"Interim Guidance: Retroactive Implementation of the US-Japan
Agreement" on September 6, 2025, filers can update their previously filed
entries to apply the newly issued HTSUS numbers after they are deployed on
September 16, 2025. For products covered by these new HTSUS provisions that are
entered for consumption or withdrawn from warehouse for consumption on or after
12:01 a.m. eastern daylight time on August 7, 2025, filers should take action
to correct entries as necessary to reflect the modified duty rate applicable
under headings 9903.02.72 or 9903.02.73, as soon as possible within 10 days of
the cargo’s release from CBP custody and prior to estimated duties being
deposited to avoid needing refunds. For unliquidated entries for which
estimated duties have already been deposited, importers may request a refund
upon liquidation by filing a post summary correction. For liquidated entries,
importers may request a refund by filing a protest pursuant to 19 U.S.C. 1514.
Civil
Aircraft
Products
of Japan that fall under the World Trade Organization Agreement on Trade in
Civil Aircraft, except for unmanned aircraft, are no longer subject to
additional tariffs imposed through:
1.
Executive
Order 14257 of April 2, 2025 (Regulating Imports with a Reciprocal Tariff to
Rectify Trade Practices that Contribute to Large and Persistent Annual United
States Goods Trade Deficits), as amended;
2.
Proclamation
9704 of March 18, 2018 (Adjusting Imports of Aluminum
Into the United States), as amended;
3.
Proclamation
9705 of March 8, 2018 (Adjusting Imports of Steel Into
the United States), as amended;
4.
Proclamation
10962 of July 30, 2025 (Adjusting Imports of Copper Into
the United States), as amended.
For such
civil aircraft articles that are no longer subject to these additional tariffs,
use heading 9903.96.02.
9903.96.02:
Effective with respect to products entered or withdrawn from warehouse for
consumption, on or after 12:01 a.m. eastern daylight time September 16, 2025,
articles of civil aircraft (all aircraft other than military aircraft and
unmanned aircraft); their engines, parts, and components; their other parts,
components, and subassemblies; and ground flight simulators and their parts and
components that are products of Japan, that otherwise meet the criteria of
General Note 6 of HTSUS (Articles Eligible for Duty-Free Treatment Pursuant to
the Agreement on Trade in Civil Aircraft), but regardless of whether a product
is entered under a provision for which the rate of duty “Free (C)” appears in
the “Special” sub column.
Except as
provided above, all other provisions of Executive Order 14257, as amended,
remain in effect.
Automobiles
and Automobile Parts
Executive
Order 14345 and Commerce’s notice implementing EO 14345, as posted for public
inspection on September 15, 2025 and scheduled for publication in the Federal
Register on September 16, 2025, modify the Section 232 duties on passenger
vehicles and light trucks (automobiles) and automobile parts that are products
of Japan and entered for consumption or withdrawn from warehouse for
consumption on or after 12:01 a.m. eastern daylight time on September 16, 2025.
The
Section 232 tariff on automobiles and automobile parts that are products of
Japan is based on the ad valorem Column 1 duty rate applicable to the products.
Currently all automobiles and automobile parts that are encompassed by HTSUS
headings 9903.94.40, 9903.94.41, 9903.94.42, and 9903.94.43 have only ad
valorem Column 1 duty rates, so ad valorem conversion is not required.
Automobiles
·
For an
automobile that is a product of Japan with a Column 1 duty rate greater than or
equal to 15 percent ad valorem, the additional Section 232 duty rate is zero
(0). Use heading 9903.94.40.
·
For an
automobile that is a product of Japan with a Column 1 duty rate less than 15
percent ad valorem, the combined Column 1 and additional Section 232 duty rate
is 15 percent ad valorem. Use heading 9903.94.41.
Automobile
Parts
·
For an
automobile part that is a product of Japan with a Column 1 duty rate greater
than or equal to 15 percent ad valorem, the additional Section 232 duty rate is
zero (0). Use heading 9903.94.42.
·
For an
automobile part that is a product of Japan with a Column 1 duty rate less than
15 percent ad valorem, the combined Column 1 and additional Section 232 duty
rate is 15 percent ad valorem. Use heading 9903.94.43.
When
submitting an entry summary to claim the 15 percent ad valorem duty rate on
automobiles and automobile parts that are products of Japan, file using the
appropriate HTSUS heading listed above followed by the appropriate
classification under Chapter 1 to 97, HTSUS. ACE will replace the duty reported
for these two HTSUS classifications with the 15 percent duty rate.
Report
the 15 percent ad valorem duty on the Chapter 99 HTSUS classification and
report the entry summary line value on the appropriate Chapter 1 to 97 HTSUS
classification.
Products
Subject to Section 232
All
products of Japan that are subject to Section 232 actions will continue to be
exempt from Reciprocal tariffs. These Section 232 actions include:
1.
Proclamation
9704 of March 18, 2018, (Adjusting Imports of Aluminum
Into the United States), as amended;
2.
Proclamation
9705 of March 8, 2018, (Adjusting Imports of Steel Into
the United States), as amended;
3.
Proclamation
10962 of July 30, 2025, (Adjusting Imports of Copper Into
the United States), as amended;
4.
Proclamation
10908 of March 26, 2025 (Adjusting Imports of Automobiles and Automobile Parts Into the United States), as amended.
Filers
should continue to file using HTSUS heading 9903.01.33 for products that are
exempt from Reciprocal tariffs because they are subject to Section 232 actions.
The
automobiles and automobile parts subject to the duties described above are
subject to the stacking provisions of Executive Order 14289, “Addressing
Certain Tariffs on Imported Articles,” 90 FR 18907 (May 2, 2025), as modified
by Proclamation 10947, “Adjusting Imports of Aluminum
and Steel into the United States,” 90 FR 24199 (June 3, 2025).
For
purposes of applying the above provisions, automobiles and automobile parts
that are products of Japan subject to the zero (0) percent Section 232 duty
under headings 9903.94.40 and 9903.94.42 are not considered to be subject to
Section 232 automobile and automobile parts duties.
Exemptions
from Reciprocal Tariffs
The other
exemptions provided for under Reciprocal tariffs, (9903.01.25,
9903.01.30-9903.01.33, and 9903.01.34), continue to apply to products of Japan.
HTS
SEQUENCING
For entry
summary lines including multiple HTSUS numbers, the following sequence must be
followed.
1.
Chapter 98 subheading (if applicable)
2.
Chapter 99 heading(s) for additional duties (if applicable)
3. For
trade remedies, if applicable,
·
First
report the Chapter 99 heading for Section 301,
·
Followed
by the Chapter 99 heading for IEEPA Fentanyl,
·
Followed
by the Chapter 99 heading for IEEPA Reciprocal,
·
Followed
by the Chapter 99 heading for Section 232 or 201 duties,
·
Followed
by the Chapter 99 heading for Section 201 or 232 quota
4.
Chapter 99 heading(s) for REPLACEMENT duty or other use, e.g., MTB or other
provisions (if applicable). Please note that replacement duty for purposes of
IEEPA or Section 232 is to be included in #3 above.
5.
Chapter 99 heading for other quota (not covered by #3)
(if applicable)
6.
Chapter 1 to 97 subheading for the commodity tariff
The
entered value of the commodity covered by the entry summary line should be
reported on the Chapter 1-97 subheading, except if Chapter 98 reporting
provisions require the entered value to be reported differently.
CBP will
provide additional guidance to the trade community through CSMS messages as
appropriate.