25% Duties Imposed on Canada and Mexico

February 2, 2025

Additional 10% Tariffs Imposed on China

On February 1, 2025 President Donald Trump signed Executive Orders imposing additional duties on imports from Canada, Mexico and China. We anticipate receiving additional details and clarity from U.S. Customs & Border Protection (CBP) in the coming days.

These are the key highlights of the President’s Executive Orders:

All products of Canada as described in the Federal Register Notice (we are waiting for that Notice – it has not been published yet) are subject to additional 25% ad-valorem duties.
Energy and energy resources are subject to additional 10% ad-valorem duty.

The term “energy” or “energy resources” means crude oil, natural gas, lease condensates, natural gas liquids, refined petroleum products, uranium, coal, biofuels, geothermal heat, the kinetic movement of flowing water, and critical minerals, as defined by 30 U.S.C. 1606 (a)(3).

All articles that are products of the Peoples Republic of China (PRC), as defined by the Federal Register Notice (not yet published) are subject to additional 10% ad-valorem duties.
All articles that are products of Mexico, as defined by the Federal Register Notice (we also await this Notice publication) are subject to additional 25% ad-valorem duties excluding articles encompassed by 50 U.S.C. 1702(b).
The tariffs imposed by every one of the three orders will apply beginning 12:01 a.m. E.T. on February 4th, though goods in transit as of 12:01 a.m. E.T. on February 1 will not be subject to duties (note – special certification by the importer will be required.)
The rates of duty established by all three orders are in addition to any other duties, fees, exactions or charges applicable to the imported products.
NO de-minimis (Section 321 or Type 86 entries – imports valued under $800) will be allowed.
NO drawback for the additional duties will be available.
All three orders include a retaliation clause. Should any of the countries retaliate, the President may increase or expand in scope the duties imposed by the Executive Orders.
FTZ – articles that are product of Canada, PRC, Mexico, except those that are eligible for admission under “domestic status” as defined in 19 CFR 146.43, which are admitted into a U.S. foreign trade zone on or after 12:01 a.m. E.T. on February 4, 2025, must be admitted as “privileged foreign status”, as defined in 19 CFR 146.41, which means that they will have to pay the additional duty upon entry into the U.S. commerce.
The Secretary of Homeland Security shall determine necessary modifications to the HTSUS – we should see this soon.
We are waiting for Federal Register Notice for additional details. It has not been released yet.
We expect additional guidance from CBP in the coming days.
We do not know how these additional tariffs will impact USMCA (CUSMA).