By Vincent Wen    Photo：CANVA

With Trump re-elected as President, his repeated emphasis on raising U.S. import tariffs has drawn widespread attention. Many Asian exporters, especially Chinese companies, have been closely monitoring this policy. Some even rushed to ship goods to the U.S. before Trump officially took office. In the past, cross-border e-commerce practices included shipping goods from China to Mexico or Canada and then trucking them across the border into the U.S. However, this method is now increasingly resisted by U.S. authorities.

Recently, many Chinese clients have asked whether it is possible to export products to other countries, undergo minor processing, and change the origin to avoid high tariffs. The answer is no! Unless the product undergoes substantial transformation (e.g., exporting cotton to another country and manufacturing it into clothing), changing the country of origin is unlikely. Using methods like relabeling, if detected by U.S. Customs, may result in not only back taxes but also penalties and other repercussions.

Exporting products to other countries for minor processing cannot change the country of origin to evade import tariffs. Regulations vary by product, so the best approach is to confirm with your freight forwarder before shipping.

The U.S. Customs definition of “minor processing” means the following:

(1) Mere dilution with water or another substance that does not materially alter the characteristics of the good;

(2) Cleaning, including removal of rust, grease, paint, or other coatings;

(3) Application of preservative or decorative coatings, including lubricants, protective encapsulation, preservative or decorative paint, or metallic coatings;

(4) Trimming, filing or cutting off small amounts of excess materials;

(5) Unloading, reloading or any other operation necessary to maintain the good in good condition;

(6) Putting up in measured doses, packing, repacking, packaging, repackaging;

(7) Testing, marking, sorting, or grading;

(8) Ornamental or finishing operations incidental to textile good production designed to enhance the marketing appeal or the ease of care of the product, such as dyeing and printing, embroidery and appliques, pleating, hemstitching, stone or acid washing, permanent pressing, or the attachment of accessories notions, findings and trimmings; or

(9) Repairs and alterations, washing, laundering, or sterilizing.

In general, unless the product undergoes processing that results in a change of HS code, it is unlikely to meet the criteria for a change in origin.

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