Samantha Hurst, and to introduce myself, I am one of our Regional Managers for Marketing and Bids for the Americas region. I will just be supporting in the background here today. One of the things that everyone always asks is, how do we receive the slides? We absolutely will get the content from today's webinar to you. We just encourage you to fill out a quick feedback survey that you will receive via email from myself within about an hour or two of today's webinar wrapping up. At the very end of that survey, just pay close attention because it will not take you to a new page. It will just give you a thank you message, and then at the very end, there is a link that will take you to all the materials, and that will include the recording, the Q&A, questions and answer pairings, and then also the presentation slides.
Without further ado, let us get into it. I will introduce our speakers and then a quick disclaimer. Just remember that today's information is for educational purposes. We are not lawyers by any means. We are just here to give information about what we see happening in the customs market and give you some idea of how it might impact your business. Again, this is not meant for legal decisions to be made based off of this content. Now I will introduce our speakers. We have a smaller group today. We have got a couple of people traveling, as this team often is very busy people, but we appreciate Madeleine Veigel , our Vice President of Customs for the Americas is on with us today, and Stephanie Holloway, our Senior Director of Customs. They will pop on. Stephanie, I believe you are taking it away.
I am. Thank you, Samantha, so much. Samantha is going to die that I am going to say this, but I feel like we are all in this webinar family together, and I got to meet Samantha for the first time, and she said, "You are going to see how short I am." I was like, "You cannot honestly be that short," because she gives off, you guys can chime in on this, she gives off such tall people vibes, and she is 5 ft tall, everybody. The whole time, my brain just could not reconcile it. Samantha, now everybody.
Thanks, Stephanie.
All 1,200 of us now know how tall you are. If any-
5 ft tall on a good day.
If anyone else was wondering, there you go. Now some insider baseball to Expeditors. Hey, look at that. Samantha, there is another 5-foot-tall person in the crowd, so I love this. Now everybody is going to be guessing at how tall Madeleine and I are. Madeleine is taller than me, just so everybody knows. Let's jump in here. We are alternating back and forth, so I am going to be doing tariff and trade section. I will hand it off to Madeleine, who is taller than me, to talk about what is happening in the court system. I am going to talk about what is on the horizon, and then Madeleine will wrap up with enforcement. We have a nice full agenda, as we always have. Customs and the Trump administration always provide, so we never have to worry that we will have enough.
With that said, I think our last webinar was September 22nd, if I am remembering correctly. At that point, the Section 338 import ban had not yet started.
As we all know, Section 338 was one of, I would say, the first time the Trump administration had used this legal basis to put tariffs on, and it was for Canada. You use Section 338 when there is discrimination against U.S. commerce, and the Trump administration said Canada was discriminating against three industries, dairy, autos, and alcohol. Their tariffs were proposed. It was a 50% tariff that took effect back in August. When we met, that tariff was already on. The scope got changed, not that much longer, a few weeks longer. A few weeks went by, and the scope got changed around mid-September. Essentially what it did was it said there is going to be an import ban.
They adjusted some of the HTS numbers because a big part of Section 338 that you have to understand is the HTS that the U.S. is targeting from Canada do not correlate directly to the discrimination in the products that is happening. Some of them do. But it is not just like, "Hey, I do not import dairy. I do not import autos. I do not import alcohol, therefore, this won't impact me." That is actually not how this works. So they made some adjustment to the HTS list, and then we were all wondering, "Hey, is this import ban going to happen?" Because the other thing about this kind of, I will say, ping pong match, for lack of a better word, between the U.S. and Canada, is that each is giving each other kind of a long leeway, right?
The U.S. will announce something but it is not just, "Hey, this is happening tomorrow." There is usually a few weeks. I personally, this is Stephanie Holloway's opinion, I think it is because they want each other to come to the table. They really want to have an agreement here. But at this point, we do not have one, and import bans did start on September 29. Just because I am a little bit of a trade nerd and I like data, I wanted to look at our own data set, so this is just Expeditors entries, to see, hey, what played out, right? I think most of us know there is obviously going to be certain industries that are going to be more prevalent to be imported from Canada down to the U.S.
Over here on the far left column, and I have used this before, this is how USCBP groups you as an importer. It is called the CEE, Center of Excellence and Expertise, or your industry. What I did was I said, "Hey, as we have gone through each of these iterations, working our way towards the import ban, what happened?" This is where it is obviously fun if you play with data, but it is real fun with AI, because I was trying to kind of level set it and say, "Hey, we definitely do more auto than agriculture and prepared products, AKA alcohol, but let's equalize those so that we can look at it as a cross-section." Everything has been equalized to this pre-338 level to 100. Then what you can see there is at the 50%, what happened.
At the expanded scope mark, what happened, and then with the import ban, what has happened. What you can see really is the automotive consumer products machinery, a little bit up, a little bit down, not too many swings. Of course, at least for what Expeditors imports, it is buried within the agriculture and prepared products. That is where the alcohol is that we import. That has been hit very hard. You can see there that there definitely was a significant tick up before the import ban. You can see that these importers truly believed or were at least hedging their bets that this import ban may happen, and therefore they got a lot more products in, almost double. Now it has decreased of course. There are still food products in there that can be imported, which is why that is not at zero or even a lower number.
That was fun, right? Just a little bit of nerd talk for you. Another thing that I want to touch on is we have 338s happening right now. There is a lot of, I would say, almost trade noise happening, but it is almost hyper-specific. Okay? It is like if you do not import from Canada, Section 338 is not really that impactful to you. But if you do, and especially if you do alcohol or something that is on the import bans, it is really impactful. That is how I feel like almost everything I am going to talk about in this category is right now, is it is just kind of noise. Unless it hits you, then it really hits. I am going to talk about them a little bit in a broader sense as well, because through all of this, looking for the themes is the really important part. Okay?
This is a good theme one to look at. When did this come out? A couple of weeks ago? I am going to go, yes, sometime in the last couple of weeks. There was a release per se, done that helped define U.S. content for a very specific situation. For under Section 232 metals, if you are taking this Annex I-C mobile industrial equipment and machinery, if you are taking that exemption, there was a reference to U.S. content, but it was never defined. This came out back in June 8th, I think, is when you could start using it. At least that is what this slide seems to convey. If you had used it, you were kind of in this gray area. You kind of had to make up your own definition for U.S. content. This is not super unique.
This is a space that many of us keep finding ourselves where you talk to one trade lawyer, they are interpreting it one way. You talk to a consultant, they might think another thing. You are reading it, maybe your broker thinks something else. We all kind of have our own thing that we are trying to work through, and we are not often given extra clarification. But when it does come, we have to adjust, right? That feels kind of obvious, but it just feels like another thing that you have to do and keep track of. Unfortunately, that is what we are in. This is a great example of that in terms of if you were an importer and we had such few ones. I know this is not super impactful to folks.
If you use this, now all of a sudden, you need to have a mechanism to relook at the definition that came out. Then we got to figure out, hey, does this involve doing PSCs? Do I need to go back? Customs hasn't issued a CSMS message on it yet. What do I do with this information? This is more of looking at it as that theme. So when you're in those gray spaces and you're making those choices, how do you keep track of that? Then how do you make sure that you're circling back when there's more data being provided? Going along a little bit on the same theme as the import ban, we are looking at an interesting time with Section 232 polysilicon. So we have a looming Section 232 case on polysilicon that will be coming in in December.
This Section 232 case was actually announced in August. This is definitely the largest runway that we have had between when a case was announced and when it is being implemented. The second longest was probably pharma. So, this is unique, but what we also are seeing now is that, I have to look at the I'm like, how long ago was this? About a month ago, Commerce put out an anti-stockpiling rule. This is also very unique. We have not seen this before for other 232s. So in your head, if you have a pending 232 medical equipment, this might be something that is introduced for your products as well. So just something to kind of think about. So it's still on track. They didn't move the date up, so it's still December 4th is when this is going to get implemented.
But now, Commerce is watching to see, hey, how much do you normally import, and are you still within those bounds? If you need to import more, you need to talk to Commerce directly so that you can get that approved. Or if they don't approve it's going to need to go into a bonded warehouse until December 4th, which at that point, you can import it under the Section 232 duty structure. So very interesting, very unique. We have not seen this before. Once again, right, it's these very ticky-tacky things, very impactful to some. A very small amount, not so impactful to all, but how do we look through and find the themes of what we all need to be looking for? The last thing I'll touch on in this section before I turn it over to Madeleine is the Russian sanctions law.
This is the Lindsey Graham bill that was passed back in September, and we talked about this on the last market update. It was an interesting thing to talk about, because this is a whole another unique way that tariffs can be administered. It allows tariffs to go on Russian origin goods and the top five buyers of Russian crude and natural gas or the top five facilitators of Russian oil sanctions evasion. Or evasion, sorry. So even if you are just buying products that have nothing to do with Russia, if the country of origin is one of the countries that ends up on this list, you could be highly impacted. So the secondary tariffs on this could end up being quite far reaching, let's say. Also, these tariffs are set to stack.
Now, of course, I do not know exactly how they will be implemented, but I think you should really assume that that is something that could actually happen. Now on October 16, so just recently, an executive order came out, there is a link to it here, that essentially set the rate amount. So you can see there 500, 100. Crazy times that we are living in. But that same executive order also waived all of those duties and most of the sanction provisions for now. Okay? So I want to reiterate, no new Russia-related tariffs are in effect. There are still others that are on the books. Those did not go away. Okay? But there are no new tariffs from this law. Okay? So, what is really important, though, is that this law is completely queued up, okay? It is ready to go. They have the executive order out. They have everything ready to go.
This thing could turn on a dime. I do not know if it will. There was a report, it was not written down, and I cannot remember who said it, so probably should not say it out loud on a webinar. But they essentially said that they are going to reassess this in mid-December. So take that with a grain of salt, but this is a very important thing to keep an eye on. And they did not list the countries, they did not list the top buyers or facilitators. And that is where I think a lot of people, if you are trying to read the tea leaves, there is a lot of latitude in how those things will be defined. Okay? So we will see what happens. On that note, Madeleine, I will turn it back over to you to talk about the court system. Also very lively these days.
Yes, very lively. Lots of updates. And I am a little taller than you, Stephanie. Not a lot, but a little.
A lot taller.
I don't know about that. Oh, boy. Everybody, there is a lot of news in this section. First, we'll just start with some stats on CAPE. You'll see here that originally, the government or the administration, when CAPE first rolled out, they said, "Hey, there are about $166 billion worth of IEEPA duties that have been paid by importers." That covered about 53 million entries and around 330,000 importers. As of October 2nd, the government has processed, or the administration, CBP has processed $136.6 billion of that amount in CAPE. Not that it's made it maybe all the way through CAPE, or it has and has been fully certified as a refund, but $136.6 billion has been accounted for through CAPE. Of that amount, $126 billion has been actually refunded or at least sent to the treasury, set up for a refund.
That leaves about $30 billion that's still on the table, everybody, still on the table in terms of refunds. We can say a pretty large portion has been accounted for by CBP, so that is good. One other thing I would say, though, about this, which is kind of interesting, and it's something obviously we talked a lot about when CAPE first rolled out, was making sure you have an ACH account set up so you can receive the refund from CBP. We run weekly reports on this, and there's still importers, lots of importers that don't actually have their ACH set up. Maybe just another little blurb on that. Just make sure you've got your ACH account set up so you can receive the refund, because there are still importers out there that don't.
Anyway, that's where we're at in terms of current stats with CAPE. Quite a bit has been processed, but really kind of the big news or most recent headline news is the fact that we are now in CAPE Phase 3. We can flip to the next slide, Stephanie. CAPE Phase 3 is finally live, and that went live on October 6th. As of October 6th, well, actually as of October 7th, after the first day that it was live, there are about a little over 1 million entries that were uploaded into CAPE, and that covered about $500 million in claimed refunds that had been accepted. There are a few caveats though for CAPE Phase 3. First of all, it's not open to everybody, right?
You have to have filed a lawsuit in the Court of International Trade in order to be able to file in CAPE Phase 3. The second caveat is that you must have given your IOR number to CBP by July 30th. If you had filed a lawsuit in the Court of International Trade and you had submitted your IOR number to CBP, then you can start filing for a refund in CAPE as of October 6th. Of course, that also means that your entries are past that 80-day final liquidation cycle. We'll go through the liquidation cycle again here in a moment, just to remind everybody.
But the other big news that came out just this morning, and some of you may have seen that already, is that CBP, they had said on October 6th when they rolled this out, that other folks that have filed a lawsuit in the Court of International Trade, but maybe not until August or at a later time or last month, they will be sending out instructions on a rolling basis when those importers can also file in CAPE. And just this morning, there was a notification that if you filed a lawsuit in the Court of International Trade and you provided your IOR number to CBP as of July 31st, up through August 13th, you can now also file for a refund in CAPE. So that's brand new, hot off the press. So CBP is sending out those instructions on a rolling basis.
So again, if you filed late August or filed in September, you will get instructions as to when you can actually put your entries through CAPE for a refund. Okay? So that is probably the hot news in terms of CAPE Phase 3. It's alive and working. But again, got to have filed a lawsuit, got to have submitted your IOR number to CBP, and your entries have to be in the right post-liquidation cycle. So I think we can go to the next slide, Stephanie. And we've shared this slide before, everybody. This is just the life cycle of a customs entry. It's just kind of a reminder. When the entry's filed, then when the entry summary is due by 10th day, and then duties are due by 10th day, unless you're on periodic monthly statement, and then we go through this long liquidation cycle.
Normally, entries liquidate about 314 day-ish or ish after the entry date or after the date of entry. And then Customs can still make adjustments from that 314th day up to from 314 days plus 90. And remember, Customs said that 314 up to the 80th day, that's the previous phase of CAPE. But once you got beyond the 80th day, then it gets into Phase 3. Then the Phase 3 is what just got rolled out. And it's usually after that time too that CBP rarely makes any other modifications. So, you have to be 80 days plus in order to take part in this Phase 3. So hopefully that made sense. You'll get copies of this if you need to go back and look at the life cycle of an entry. Okay. So other big news on the IEEPA refund front.
So the CIT, so the Court of International Trade, and that famous Judge Eaton, and he's kind of famous now because he's been the judge involved with all these IEEPA refunds. He certified a class based off of a lawsuit that Freestyle World, Inc. filed against the U.S. So what does that mean? So a class is really a group of importers or a group of companies that are basically making the same legal claim, right? And that's what we have here, is we have a whole bunch of companies or importers saying, "Hey, I want my money back, my IEEPA duties back," because the Supreme Court deemed that those duties were established illegally by the administration. So I'm due my money back. So this is why Judge Eaton said, I can create a class here because it's a bunch of companies that are all making the same legal claim.
Okay? That's what he did, and that also means, again, it covers all importers. This class now covers all importers that filed between February that had paid IEEPA duties between February 1, 2025, and the 19th of February 2026. The only importers that it excludes are those that filed a lawsuit in the Court of International Trade. Only if you file the lawsuit in the International Court of International Trade, then you're not part of this. But if you didn't, then you're automatically part of this class, right? You can't really opt in or opt out. It's just you're part of it. Okay? There were roughly 4,000, just kind of a side note, there were roughly 4,000 companies that did file lawsuits in the Court of International Trade. But now we have this class, right, that was determined by Judge Eaton.
That does not mean you're getting an automatic refund. We all wish that that would now mean, "Okay, give us our money back." No, it doesn't mean that yet. The court has to enter or has to declare a class-wide injunction, and that would allow CBP to process all of these entries. They have not done that yet because, of course, they have to allow time also for the opposing party, the government, to appeal. We all know that the government will appeal this case. For right now, there's going to be a discussion between all the parties, and a schedule is going to be proposed as of the 22nd of October, which probably will define what are the next steps. That will come out the 22nd of October.
But this process, everybody, this is going to take a while, as you can well imagine, because the government is going to appeal. This does not mean you're going to get your money back quickly. This could still take a year, two years, who knows? But it's going to take some time. It's not going to be immediate. I think this is probably a good thing, especially for the smaller importers that haven't really done anything with CAPE yet, that have been confused by CAPE or don't know quite how to even submit their entries through CAPE. Them being part of a class may be a way for them to eventually still get their IEEPA duties back. Really, this becomes a discussion kind of internally because you're all probably, or many of you may be asking yourself, "God, what should I do?
Should I file a lawsuit in the Court of International Trade, or should I just, since I haven't, I'm part of this class action suit now, should I just kind of wait and see how that plays out?" If we go to the next slide, Stephanie. You really have to take inventory internally. First of all, look at how many entries do I have that are past that 80-day final liquidation cycle, right? How much money am I still, in a sense, owed, or how much money should I still be getting back in terms of IEEPA duties? Then if it's a lot of money, that may be a consideration to go to file a lawsuit in the Court of International Trade because you may get your money back quicker going that route.
If it's not a lot of money, maybe you could say, "Hey, I'm not going to go through the trouble and the expense of filing a lawsuit. I'm going to sit back and see how this class action suit plays out. I can wait. It may take a while, but that's okay." These are discussions that you really have to have internally with your. This is where I'm going to say again, I'm not a lawyer. You definitely want to talk to internal counsel or talk to a trade attorney and figure out what makes sense. Should I file the Court of International Trade lawsuit, or should I just watch and play this out? Another thing to consider is with a lawsuit in the Court of International Trade, you have two years. Two years from the date the duties were deposited.
For, in many cases, some of those entries, it may be getting close to the time where if you need to file a lawsuit, you have to do it fairly soon. That's another consideration, the timing, right? You really have to look at where am I at with my liquidation? How much money am I still due that the government hasn't paid me back on IEEPA duties? Then is it a lot, a huge amount? Is it a small amount? Is it worth it for me to make the investment in the Court of International Trade and maybe get a quicker refund, or should I just wait and see how this class action suit now plays out? It may take a year, it may take two years before I ultimately get my money.
These are discussions you should have with a lawyer and have with the folks inside your company to figure out what is my best strategy, okay? Definitely a lot to consider, and you definitely want to be talking to an attorney on what is your best path of action on this. Anyway, a lot to consider and think about. Then there is other tariff litigation, everybody. This is something to watch as well. Remember, in July, the Section 301 forced labor tariffs went into effect. Remember, this is managed by the U.S. Trade Representative's office or the USTR. They did a big investigation. It covered 60 economies, and they said, "Hey, in all those countries, the U.S. government feels those countries have not done enough to prevent certain items or items that are getting imported into those countries.
They're not doing enough to ensure that those manufactured goods or those goods, whatever they may be, were not manufactured with forced labor." They haven't done enough on the forced labor front. They're allowing goods to come into their countries that may have been manufactured with forced labor. That puts the U.S. on an unlevel playing field because if we're also importing similar items into those countries, we're not at the same level playing field because we're probably having to, or those goods will have to be sold for a higher price. Anyway, at a very, very high level, that's what the U.S. government was saying. It's like, "Hey, other countries are not doing enough on forced labor." It covered 60 economies. There have been some companies that said, "Hey, I don't think this is right.
I don't think the U.S. government, I don't think USTR did a thorough enough investigation. I'm really questioning how much they really looked into some of what these other countries are doing. So there have been lawsuits that been filed against the U.S. government. And on the 30th of September, the Court of International Trade, they heard the arguments from the USTR, and then they issued additional questions both to the USTR and to the plaintiffs in this case, the companies that sued. And the questions, there's a list of about six or so questions.
One of them, to give you a flavor of what it looked like or what it sounded like, is that they asked the government, they said to the USTR, "Hey, USTR, what statutory provision did you rely on to deem that the other countries have done not enough or have done an unreasonable amount to curb forced labor? What statutory provision did you rely on?" So they've asked that, among some other questions, they asked the USTR to respond to. For the plaintiffs, for some of the companies that sued, they said, "Hey, you did not import from all those 60 economies, so do you have the right leg or the solid leg to stand on in bringing this lawsuit forward?" Anyway, the plaintiffs and the government had to get back to the Court of International Trade with their responses last Friday.
You may have seen there have been some publications on what USTR provided as a response and what the plaintiffs provided as a response. So now we just have to wait and see, everybody, what the Court of International Trade is going to do on those 301 forced labor tariffs. And we have to watch this closely because this could play out as a potentially another refund opportunity, but we'll see. This one is going to be a little bit more difficult than maybe the IEEPA refund case was. Then we also have lawsuits that were filed under Section 122. Remember, that went into effect in February. It was really used to replace the IEEPA duties, right? And it was done under the whole premise of a balance of payment deficit.
There have been some companies that sued the government and said, "Hey, U.S. administration, there really isn't a balance of payment deficit with many countries, so we think you did this illegally." So in May, the Court of International Trade said, "Hey, we actually agree with the importers that brought forward this suit." There was a spice company, a toy company, and also the State of Washington, and there were some other states, I believe. But basically for the State of Washington, the spice company, and the toy company, the Court of International Trade said, "We agree with you. We don't think there's a balance of trade deficit, but actually, so we agree that those tariffs were implemented illegally, but only for you." In other words, this is different than IEEPA. Before with IEEPA, they said really should apply to all importers.
For Section 122, it's just those three importers. However, as you can imagine, as soon as that came out on May 7, the government immediately appealed. Now we're just waiting, right. The appeal was filed, and we just have to wait and see ultimately what the courts decide. This could also go all the way to the Supreme Court. This may also end up in a refund situation. We don't know. This is also kind of a difficult case. But we should all be watching these cases because it does mean or could mean there are other future refund opportunities we don't know. Anyway, keep your eyes open for what happens next, both in the Section 301 forced labor case and Section 122 case. Anyway, Stephanie, I think you have to tell us what is on the horizon. Oh my gosh.
I don't know.
There's so many more, but I know there's more.
So many good lawsuit questions, Madeleine.
Oh, no.
When I am doing this, you can-
I will head over those.
-head over there and check all of those out. I think what most of you are seeing on the lawsuit that is becoming super strategic from a business decision is whether or not you want to file in the Court of International Trade. That is really the part that you need to think about, A, how much money is in that bucket? If it is 100 bucks, that is probably not worth your time. However, if there is a lot of money there, that is probably what starts opening up the door to your company to say, "Hey, do we want to go file in the CIT?" With the overarching backstop of this two-year mark. You have two years typically, once again, as Madeleine keeps saying, not lawyers. You have two years from the date of injury to file in the court system, typically. That means you are coming up against this deadline.
That's going to be February 2027 or March 2027, depending on when you started paying IEEPA duties. Those are the key things you need to know. Before you go crazy, make sure you know how much money's in that bucket and then that can start the conversation, and that's where I think the best place to start is. Okay, so no more lawyer talk, no more court talk. Let's talk about what's coming. Somebody said, "What's a lot of money?" That's up to you. I don't know. It depends on how much you want to pay a lawyer. Okay. U.S., China. I think actually last week, feels like last week. Last month when we were talking, that's when President Xi from China was in the U.S. and we were all speculating if there was going to be conversation around trade. There was, a bit.
This is what came out of our conversation with China. Let's level set. First of all, we all know that the original tariffs back from 2018 for Section 301 are still on. Actually, there's a four-year renewal process that now we'll have gone through. This is our second time. I don't know, I'm probably messing up all my math here, but list two and three just got reaffirmed. Okay? That's important. Those Section 301 China tariffs, those are on, those are rolling. USTR just reconfirmed that. However, there's a link here to this U.S.-China Board of Trade Agreement, and you'll start to see Board of Trade, as an acronym. It's B, o, T, BoT. I don't know. B-o-T. However you want to say it.
All of a sudden, I felt like I kept seeing all this stuff that was like, "BoT," and I was like, "What is BoT? What did I miss?" Board of Trade. Okay? Essentially what they're looking at, and if you click on this link, you can see both the China list and the U.S. list. China and U.S. have said, we are mutually going to look at I wish I could remember. It's some dollar amount. Dollar amount into China, dollar amount into the U.S., and we are going to say that these items that we're going to identify, I believe, the way I'm reading it, we will see, will drop down to MFN pricing. Okay? I also believe that the lists that have been identified are not on the Section 301 list. Okay? All speculation, we will see how all this plays out.
The important part is that that list of 77 categories, some of it is HTS-based, some of it is kind of description-based. If you remember and you were around in the industry for the good old days of 2019, 2020, we were doing a lot of Section 301 exclusions, which same kind of concept to where it was like some were HTS, some were description. That's what this kind of feels like again to me. We will have to see. They're going to open this up for a comment period. I have not seen that posted yet. If I am wrong, please put it in the chat. If you know that this maybe it got posted in the last hour, let us know, because there's going to be a lot of people that are obviously very interested in commenting on this. It's a lot of items.
I think I heard Jamieson Greer say, he gave a list of products and included fireworks. There's things that the U.S. does not want to manufacture. Apparently we don't want to manufacture fireworks. We want to get them from China. Fireworks are definitely on the list. There'll be opportunities for people to comment. It's a lot of that type of, not just explosive manufacturing, also kind of toys and things like that maybe the U.S. isn't so interested in developing manufacturing expertise within the U.S. More to come. This slide's so busy. What this is looking at is low-value shipments. We know that there has been some pretty big evolution since President Trump took office in terms of the administration's approach to low-value shipments. This is another phase that is being looked at.
There was a proposed rule that just came out two weeks ago. It is over 100 pages of good time reading. I was reading it on my phone and I was at the airport and I'm reading. I'm like, "Oh my gosh, how much can somebody say about informal entries?" A lot. Over 100 pages worth. What they're essentially looking for, and comments are available, they're due December 7th, is they're really looking at when and how informal entries can be used. Right now, informal entries are the only kind of low-value shipment option that's out there. I want to make sure everybody on this call understands an informal entry from a preparation perspective for a broker is the exact same amount of work as a formal entry. They are one and the same. There's some different bonding requirements.
They liquidate immediately, but the actual preparatory work, the same. That was one of the things when I was reading this, I was like, "I don't think the government understands informal entries, and they are the same amount of work." I just want to make sure everybody here knows that. With this proposed, one of the big things you have to understand is informal entries will not be able to be used if the freight has already arrived to the U.S. Oh, also, informal entries have a different fee structure for MPF, merchandise processing fee. I was trying to remember off the top of my head all the benefits of informal. The list is not huge. Every informal entry needs a bond. I would say for Expeditors, if you're on this call, you have a bond, right?
There's not many customers that are just running an informal scheme here. Scheme, that's not the word to use. Informal scheme and don't have a bond. That one, not such a big deal, maybe for all of you. More data per shipment, so adding the final delivery to party if it differs from the consignee. They can also require formal entries in bulk. You can kind of think this might be a little bit more targeted maybe to the couriers. I know many of you aren't actually wanting your couriers, the traditional folks maybe that have done low-value shipments, you're wanting your actual brokers to do them. There's also kind of a big industry shift that's happening within this space. The good news, that's in a gray box, that's exciting.
Section 232/301 goods valued between $250 and $2,500 could use informals again. What do you do with this? I do think it is worth looking up. I have the link in here for the proposed rule. It is worth looking at, thinking about, hey, what are you actually using informal entries for? Do you rely on that flow? Maybe a little bit. This is also with mail shipments, not the letters. I like how I looked at my desk for a letter. I have one right here. Not a letter per se, but the small boxes, right? Maybe an R&D box or things like that. Which ones of those are rolling through this? Then considering commenting. Is this going to be a world-ending change?
Likely no, but there is stuff in here that's not great, and maybe there's also stuff from an importer's perspective that I'm not thinking of. The key takeaway, of course, is that de minimis is gone. That is not a thing that's in the U.S. anymore. Just in case you thought it might come back, it's actually in the One Big Beautiful Bill Act, if you remember that, to really be killed July 1st, 2027. So that is actually a congressional order, or I shouldn't say order. It's on the books from a law perspective that that will be over July 1st as well. So informal does not mean less work. It is the same amount of work from a broker, and really thinking about those low-value flows, and how this will impact you.
But I think many of you, this has already impacted you, and many of you are already looking at alternatives for those low-value shipments. The last thing I'll say is about overcapacity. Hopefully, you know, the day that IEEPA, so February 20th, 2026, the day IEEPA got overturned and the Supreme Court said you cannot use IEEPA to put tariffs on, President Trump announced two Section 301 cases he was opening, one on forced labor and one on overcapacity. Forced labor we know is here. We're all living it, right? Where those duties are being paid actively. The other one is this 301 overcapacity one. Jamieson Greer has commented on it a couple of times, saying it's coming soon. I don't know if it's coming soon or not. Most of the time when the administration says something is coming soon, it does.
So I try to believe them, in terms of what they say. However, there was an interesting development two weeks ago. Maybe you don't know this, but in Milwaukee, the week of October 7th, the G20 trade ministers met. They came to this agreement, and I'm only highlighting it because, of course, it involves overcapacity, that we have this kind of looming Section 301 open on that's just out there. It's gone through the comment period. It's just kind of chilling, waiting for USTR to take action. So on the overcapacity front, a number of countries signed, some of them did not. The media headline was that 75% of the G20 membership endorsed it, and they endorsed it on five sectors. So cars, especially EVs, batteries, chemicals, semiconductors, and solar panels.
If you've been paying attention to tariffs, those are the hottest of hot commodities to talk about. What these countries agreed to do was to start sharing data, comparing notes on the impact of production in those sectors and to try to work together from a mitigation perspective. Do I think that Section 301 will not come to be? No, I am not saying that. I'm just saying that I think it's very interesting that we have a Section 301 case out there on overcapacity. There is conversation, obviously, among the G20 about overcapacity, and this will be an interesting thing to keep an eye on. We will see what happens. This also kind of means, too, just shifting sourcing or maybe strategies like that that we have traditionally looked at to reduce tariffs.
I think many of us now have seen that those are not super effective, but especially in these sectors, we might be getting the same treatment across the board. Interesting time to be alive. With that, Madeleine, I'll shift it back to you to finish us out on enforcement.
Right. Thank you, Stephanie. All right, everybody, I think we all know, obviously, about the big executive order that came out on June 3, strengthening customs enforcement. Hopefully, you've all read it. It's only aboutseven pages. We've recommended highly that everyone read it. Anyway, that came out on June 3, and just as a quick summary, remember, it had several big changes that are within that executive order. Again, I think it's the biggest change since the Mod Act and since NAFTA. But it talks about importing becoming a privilege, not a right. Importers have to be in good standing. We're still waiting on more definition on that. Export documents may be required. CBP wants to look or seek proof earlier in the supply chain. The penalty exposure will increase.
Anyway, there's a lot of really important big things that the administration talks about in this executive order. One thing that was a little surprising but good is that the administration put out, the beginning of September, an advance notice of proposed rulemaking, which came out in a federal register notice. It is very good that this came out because it gives all of us an opportunity to give our feedback. There are 64 questions in the advance notice of proposed rulemaking. The administration is asking for input on this foreign export documentation, identifying the parties in your supply chain. They talk about MIDs, they talk about the Global Business Identifier. They talk about disclosing more supply chain parties. They ask questions about that. They ask questions about tracing, traceability, and tracing technology, the filing timelines, CTPAT enhancements, the implementation of a lot of these sections.
There are a lot of questions very focused on importer of records, importers of record, also on brokers. This is our chance, everybody, to give our input on some of these really big-ticket items that we are all very worried about. We can go to the next slide, Stephanie. We just wanted to give a quick blurb here for, please, we think it is super important that everyone make comments. Of course, many of you are saying, "Hey, I do not want to put my name out there to Customs and make a comment on this." That is totally fine. There are lots of folks in that category. Then you can make comments and make your opinions known through an association. There are tons of associations out there. I think almost all the associations are going to go back with comments.
You have an opportunity to voice your concerns to the associations and get your voice heard and your voice included in those comments. It is really important that we provide the government with feedback, because again, they are putting out some big-ticket items that we are all very worried about. To make a good comment, first of all, one of the big things is make sure, or if you can, support your comment or your feedback with data, or at least be able to quantify the cost and the time with data. If we take the export documentation example, we are all worried about that. Do we have to obtain the actual export declaration from the country of export and all the documents that were affiliated with it? How am I going to get my hands on that? How much time is that going to take?
The cost involved, where am I going to store it? How am I going to be able to provide it to Customs? Is this going to be done on a transactional basis, which would be really difficult? Being able to quantify the cost and time of something like that is very, very helpful and makes for a very good comment. Concrete examples are super important. There are 64 questions. You do not need to respond to all 64 questions. It will be crazy. It is much better to focus on just those questions that are super important or that would really affect you and your supply chain. Do not feel like you have to answer everything. Just focus on a couple that are really important.
Again, if you do not want to answer directly and send your comments directly to Customs, you can do it through an association. It is super important, everybody, that we do provide comments because this is the way the government will hear at least what the trade is thinking about some of the things they are proposing in that executive order. As we all know, there are some doozies in there. The other thing on the enforcement front, everybody, and we have talked about this is really just a recap. Remember, the Form 5106 is really the importer identity form, and Customs wants to make sure that all that information is up to date. It is really, really important that you make sure that the information that is in the ACE Portal that was submitted as part of a 5106 is up to date.
You'll see here it includes your legal name and importer number, your mailing and physical address, phone numbers, email addresses. You can imagine, as you have turnover, as you have people change around in your organization, that this can get out of date very quickly. It's super important that this be up to date, because if it's not, as of September 18, and this is one formal sort of instruction or direction that Customs has provided the trade based off of the executive order, as of September 18, they will start voiding importer numbers if the information from the 5106 is inaccurate or incomplete. Okay. If they void that number, that means you cannot use that number for entry purposes. It could maybe prevent you from entering goods into the U.S. Again, super important to make sure that this information is up to date.
I think on the next slide, Stephanie, we'll give you a link to this. We have a quick guide that we've put together that'll show you where in the ACE Portal you can see exactly what information is on file. You'll get a link to this. The last thing, just to make sure that you're aware that it's out there, the Department of Justice, you all know they have a trade fraud task force. In the beginning of October, the Assistant Attorney General put out a directive to all of the trade fraud task force in terms of enforcement and what they're doing. They have four priorities listed in this document. It's short, it's only five pages. The fourth priority out of the four, the fourth priority is tariff evasion, import fraud, and forced labor. Super important.
That is a super important priority for the task force and for the DOJ. Just make sure that you're aware it's out there. This again, makes it really important that everybody goes back to the basics and makes sure that your classification, your country of origin, your value, all of that is correct, that you have a story to tell on those three big areas. It's really going back to the basics. This is just a reminder that again, this document is out there. There's again, more in the news, so to speak, about trade fraud and trade tariff evasion and that it's super important that we've all go back to the basics and really look at that internally. Anyway. Oh my gosh, we're getting towards the end.
I guess a really quick recap on how to engage and prepare Stephanie, in a few minutes, I guess.
Thank you, Madeleine. Yes. We've given many of these points throughout the slide deck as well, but just really putting them in kind of these buckets. Once again, the tariff and trade remedies stuff right now is hyper-specific. Some of you are like, "I wish my life was boring." And others of you, your life is a little boring right now, and you can take a breather and just look at the themes and the trends that we're seeing, and just take a breath, because that's what we all need. Otherwise, as Madeleine said, I think one of the biggest things, this keeps kind of spiking and going back down, but it's really paying attention to the court system to know how much money you have in that finally liquidated bucket for IEEPA, and what you can do about it.
If that number is big enough, and big enough to you means different things, right? For some of you, that's $5,000. To some of you, that's $5 million. I don't know. It's all over the board. It's up to your company. But you also have to have the conversation. Filing in the Court of International Trade is suing the government, and there's many customers I've talked to that are like, "My company's not comfortable with that." So that's a decision you're making. If that's true, and that's what you want to do for now, then this class group might be a good option for you. I don't know. We'll see how this all sorts out. Nobody knows. We are all in this together. Enforcement, as Madeleine said, making sure you're 5106. We will repost this job aid as part of the links where you can download the presentation.
And really the biggest thing right now is the supply chain comments for December 1st. Many people asked, "Hey, which organizations do I comment with?" If you are industry specific, most of these organizations you pay a membership fee. So one place to start is if you have a government affairs person, ask them, "Are we part of any memberships? Is there an industry group that you work with?" Maybe not. I don't know. For Expeditors, we're part of a couple of different ones. There's one called AAEI, which is American Association of Exporters and Importers. Congrats. That's all of you. They are doing a huge thing, and lots of working groups to collect that. So that's a very broad group that you can research. You can choose to join it. If you join, tell them I sent you. Just kidding. But, that's AAEI.
Do some research, talk to your government affairs folks, and see if they have recommendations or just do some Googling. But lots of people are looking at this. And then the last thing, of course, is plan. We have some maybe big duty rates in our future, maybe some duty drops. If you happen to have one of those 77 commodities for China, there's a lot there, okay? It's hard to model, it's hard to plan for this, but really being aware about what could hit us, especially in 2027, is really important. So, with that said, we do not have the NCBFAA code quite yet. We're hoping we get it by end of day, and we will include that, of course, on the slide deck. So, Samantha, I have punted a few things to you. Also, somebody told me the QR code doesn't work.
You have many things to do. I am going to eat my lunch, but you are East Coast, so you got plenty of time to fix my mess. But thank you so much, everybody.
Thanks for working on it.
For joining us. We always love having you. Samantha, anything else?
Nope. Just look for the survey that will be coming out in about an hour, and we will get information out to you guys, the materials as soon as possible. Thank you guys for joining.
Thank you, everybody. See you later.
Take care.