GSP EXPIRED AS OF JANUARY 1, 2021

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GSP EXPIRED AS OF JANUARY 1, 2021

Congress failed to reach a deal before the end of the year that would have extended the Generalized System of Preferences (GSP) program. As a result, GSP-eligible goods entered or withdrawn from warehouse are subject to “General” (Column 1) duty rates, effective January 1, 2021, at 12:00 a.m.

A bill proposed in the Senate would have extended GSP for 16 months, while a bill that was introduced in the House provided for a six-month extension. Neither bill moved forward, primarily over disagreements regarding eligibility criteria.

U.S. Customs and Border Protection (CBP) issued a guidance document on December 21, 2020, encouraging importers to continue to flag GSP-eligible importations with the Special Preference Indicator (SPI) “A” (or “A+” or “A*”, as applicable) during the lapse in GSP. CBP has programming in place that, in the event that GSP is renewed with a retroactive refund clause, will allow CBP to process duty refunds automatically for entries that were flagged with the SPI at the time of entry.

Since its inception in 1974, GSP has expired several times. Following such lapses, the renewing legislations have typically included a provision for retroactive refunds. The last lapse occurred in 2017, and the subsequent renewal was not passed for several months following that expiration.

We are monitoring developments. If you have any questions, please contact your Krieger Worldwide representative.





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