Only Non US Content will Attract Duty on Imports under US Mexico Canada FTA

1. U.S. issued guidance on Section 232 duties for MHDVs
The United States released instructions on applying Section 232 tariffs to medium- and heavy-duty vehicles (MHDVs) qualifying under the United States-Mexico-Canada Agreement.

2. Tariff applies only to non-U.S. content
Approved USMCA-qualifying MHDVs can apply the 25% Section 232 tariff exclusively to the value of non-U.S. content rather than the full vehicle value.

3. Authority originates from Presidential Proclamation 10984
President Donald Trump authorized this preferential treatment through Proclamation 10984 issued on 17 October 2025.

4. Commerce Department approval required
Importers must receive approval from the United States Department of Commerce before applying the special tariff calculation method.

5. Commerce issued implementation procedures in February 2026
Procedures for determining U.S. content in eligible vehicles were published on 2 February 2026.

6. Rules apply retroactively from 1 November 2025
The special tariff treatment applies to eligible vehicles entered for consumption on or after 1 November 2025.

7. HTSUS 9903.74.03 covers non-U.S. content
This tariff line imposes:

o 25% additional ad valorem duty

o only on the approved non-U.S. content portion of qualifying MHDVs.

8. HTSUS 9903.74.06 covers U.S. content
The U.S.-content portion of approved vehicles receives:

o 0% additional Section 232 duty.

9. Importers must report entries on two separate lines
CBP requires:

o one line for non-U.S. content,

o and a second line for U.S. content.

10. First line reports non-U.S. content value
Importers must report:

· total vehicle quantity,

· approved non-U.S. content value,

· HTSUS 9903.74.03,

· SPI code “S”,

· applicable Chapter 1–97 HTSUS code,

· country of origin,

· and any AD/CVD duties.

11. Second line reports U.S. content value
Importers must report:

· zero quantity,

· value of U.S. content,

· HTSUS 9903.74.06,

· zero Section 232 duty,

· same HTSUS classification,

· same country of origin,

· and any other applicable duties.

12. U.S. content calculated by subtraction
The U.S.-content value equals:

· total entered vehicle value minus approved non-U.S. content value.

13. ACE filing consistency required
Both entry lines must use:

· identical Chapter 1–97 HTSUS classification,

· same country of origin,

· and SPI code “S”.

14. Other trade remedies still apply
Importers remain liable for applicable:

· antidumping duties,

· countervailing duties,

· and other customs charges beyond Section 232 tariffs.

[ABS News Service/08.05.2026]

CSMS # 68559236 - GUIDANCE: Applying Section 232 Import Duties on USMCA-Qualifying Medium-and Heavy-Duty Vehicles (MHDVs)

The purpose of this message is to provide guidance on applying the 25 percent Section 232 duties imposed by Proclamation 10984 exclusively to the value of the non-U.S. content for approved imports of MHDVs qualifying for preferential tariff treatment under the United States-Mexico-Canada Agreement (USMCA).

Background

On October 17, 2025, Presidential Proclamation 10984 authorized the Secretary of Commerce to approve imports of MHDVs qualifying for preferential tariff treatment under USMCA to be eligible to apply the ad valorem tariff of 25 percent exclusively to the value of the non-U.S. content of the MHDV. See 90 FR 48451.

On February 2, 2026, the Commerce Department issued “Procedures for Submissions by Importers of Medium- and Heavy-Duty Vehicles Qualifying for Preferential Tariff Treatment Under the USMCA To Determine U.S. Content”. See 91 FR 4504.

Entry Filing Instructions

This guidance provides instructions for importers, brokers, and filers on submitting entries to U.S. Customs and Border Protection (CBP) of MHDVs that have received approval from the Secretary of Commerce to apply the Section 232 tariff imposed by Proclamation 10984 exclusively to the value of the non-U.S. content, as provided for in heading 9903.74.03 of the Harmonized Tariff Schedule of the United States (HTSUS). See 90 FR 48451.

The 25 percent tariff will apply exclusively to the value of the non-U.S. content with respect to certain USMCA-qualifying vehicles that were entered for consumption, or

withdrawn from warehouse for consumption, on or after 12:01 a.m. Eastern Daylight Time on November 1, 2025.

9903.74.03: Applies to the non-U.S. content of MHDVs for special tariff treatment under the United States-Mexico-Canada Agreement (USMCA), upon approval from the Secretary of Commerce to apply the 25% ad valorem rate of duty exclusively to the value of the non-U.S. content of the MHDV.

25% additional ad valorem rate of duty

9903.74.06: Applies to the U.S. content of MHDVs that received approval from the Secretary of Commerce as noted under HTSUS 9903.74.03.

0% additional ad valorem rate of duty

Reporting Instructions for Applying the Special Tariff Treatment Approved by the Commerce Department

Importers that receive approval from the Secretary of Commerce should follow the instructions below on how to apply the 25 percent ad valorem duty exclusively to the value of the non-U.S. content.

The non-U.S. content and the U.S. content value of the MHDV must be reported on two lines.

The first line will represent the value of the non-U.S. content while the second line will represent the value of the U.S. content.  Each line should be reported in accordance with the instructions below.

Non-U.S. content, first line:

· Report the total quantity of the imported goods

· Report the value of the non-U.S. content approved by the Commerce Department for entered value

· Report the Section 232 duties based on the value of the non-U.S. content with HTSUS 9903.74.03.

· Report Special Program Indicator (SPI) code “S”

· Report Ch. 1-97 HTSUS, same HTSUS must be reported on both lines.

· Report country of origin, same country of origin must be reported on both lines.

· Report all other applicable duties, such as antidumping and countervailing duties

U.S. content, second line:

· Report 0 for quantity.

· Report the entered value of the U.S. content by subtracting the value of the non-U.S. content from the entered value of the article.

· Report the 0 duties based on the value of U.S. content with HTSUS 9903.74.06.

· Report Special Program Indicator (SPI) code “S”

· Report the same Ch. 1-97 HTSUS reported on the first line.

· Report the same country of origin reported on the first line.

Report all other applicable duties, such as antidumping and countervailing duties.

Questions from the importing community concerning ACE entry rejections involving automobile filings should be referred to their CBP Client Representative.

For questions regarding our trade Remedy programs, please visit our cbp.gov webpage at https://www.cbp.gov/trade/programs-administration/trade-remedies or contact the Trade Remedy Branch at TradeRemedy@cbp.dhs.gov.