Pet Foods Case Study
Prior to A & A’s well thought out and logical tariff classification rationale in the form of an Advanced Ruling Application, American made Freeze Dried Fresh Pure Cheddar Cheese used as pet treats was subject to duty taxes of 245.5% as Cheese without quota.
The result of the extremely high rate of duty was:
1. It was not being imported by clients who knew about the issue.
2. If imported, clients were very surprised to know the 245.5% duty was applicable.
3. The retail cost of the product priced it out of the market.
In our rationale we argued the product should not be treated as cheese but rather as pet treats which would be duty free under NAFTA.
We provided an in-depth analysis of the tariff classification for pet treats and were able to convince Customs that the product as imported was not fit for human consumption therefore should not be considered a food product. Many months later; after legal reviews of the wording used in the various classifications and a laboratory analysis, Customs issued a ruling in our favour, which was much celebrated by our clients and the vendor.
In short the duty rate was reduced from 245.5% to Zero.