Duty Free Entry Under the Harmonized Tariff Schedule of the United States.pdf

OFFICE OF THE UNDER SECRETARY OF DEFENSE

3000 DEFENSE PENTAGON

WASHINGTON, DC 20301-3000

ACQUISITION

AND SUSTAINMENT

MEMORANDUM FOR COMMANDER, UNITED STATES CYBER COMMAND

(ATTN: ACQUISITION EXECUTIVE)

COMMANDER, UNITED STATES SPECIAL OPERATIONS

COMMAND (ATTN: ACQUISITION EXECUTIVE)

COMMANDER, UNITED STATES TRANSPORATION

COMMAND (ATTN: ACQUISITION EXECUTIVE)

ASSISTANT SECRETARY OF THE ARMY

(ACQUISITION, LOGISTICS AND TECHNOLOGY)

ASSISTANT SECRETARY OF THE NAVY

(RESEARCH, DEVELOPMENT AND ACQUISITION)

ASSISTANT SECRETARY OF THE AIR FORCE

(ACQUISITION, TECHNOLOGY AND LOGISTICS)

DIRECTOR, DEFENSE LOGISTICS AGENCY

(ATTN: ACQUISITION EXECUTIVE)

DEFENSE AGENCY AND DOD FIELD ACTIVITY DIRECTORS

SUBJECT: Duty Free Entry Under the Harmonized Tariff Schedule of the United States

The Department of Defense routinely acquires items and materials from foreign sources indispensable to meet defense needs that are not readily available or produced in sufficient quantities within the United States.

In accordance with DFARS 225.901 Policy, unless the supplies are entitled to duty-free treatment under a special category in the Harmonized Tariff Schedule of the United States (e.g., the Caribbean Basin Economic Recovery Act or a Free Trade Agreement), or unless the supplies already have entered into the customs territory of the United States and the contractor already has paid the duty, DoD will issue duty-free entry certificates for—

(1) Qualifying country supplies (end products and components);

(2) Eligible products (end products but not components) under contracts covered by the

World Trade Organization Government Procurement Agreement or a Free Trade Agreement; and

(3) Other foreign supplies for which the contractor estimates that duty will exceed $300 per shipment into the customs territory of the United States.

Effective immediately, contracting officers shall include or modify contracts to include the clause at DFARS 252.225-7013 – Duty Free Entry as prescribed in DFARS 225.1101(4) for contracts or orders that anticipate delivery of end products, components, or materials imported into the customs territory of the United States. Further, to maximize the Department’s budget to meet warfighter needs, contracting officers should indicate in a Solicitation, Indefinite Delivery Contract (IDC) or Agreement, or within a pre-contract cost agreement, that any subsequent contract action will include the duty-free entry clause, and the contractor should use the clause to assure that appropriate shipping documentation is used to prevent incurring duties. The contractor should reference the Solicitation, IDC, or Agreement number within the request.

Should you have questions regarding these requirements, please contact Mr. Jeff Grover at osd.pentagon.ousd-a-s.mbx.asda-dp-c-contractpolicy@mail.mil.

John M. Tenaglia Principal Director, Defense Pricing, Contracting, and Acquisition Policy mailto:osd.pentagon.ousd-a-s.mbx.asda-dp-c-contractpolicy@mail.mil