Quota Administration in the United States

Tariff Quota Meaning

For a definition of tariff rate quota (import quota), see here.

General Information

Import quotas control the amount or volume of various commodities that can be imported into the United States during a specified period of time. Quotas are established by legislation, Presidential Proclamations or Executive Orders. Quotas are announced in specific legislation or may be provided for in the Harmonized Tariff Schedule of the United States (HTSUS).

For information on tariff quota agreements, please click here.

United States import quotas may be divided into two types: absolute and tariff rate. Absolute quotas strictly limit the quantity of goods that may enter the commerce of the United States for a specific period. Tariff rate quotas permit a specified quantity of imported merchandise to be entered at a reduced rate of duty during the quota period. Once the tariff-rate quota limit is reached, goods may still be entered, but at a higher rate of duty. Many Free Trade Agreements and special trade legislation establish tariff preference levels (TPL), which CBP administers like tariff rate quotas. Quota merchandise is subject to the usual the U.S. Customs and Border Protection procedural requirements applicable to other imports.

U.S. Customs and Border Protection (CBP) administer the majority of import quotas. The Commissioner of CBP controls the importation of quota merchandise, but has no authority to change or modify any quota. Other government agencies, such as the Department of Agriculture, National Marine Fisheries Service, International Trade Commission, or the Department of Commerce (DOC), in conjunction with the Office of the United States Trade Representative, determine and fix quota limits.

Some quotas are global while others allocate specified quantities to designated foreign countries. Certain quotas are invariably filled at or shortly after the opening of the quota period. These quotas are opened officially at a specified time on the first workday of the quota period with procedures in place to ensure that all importers have an equal opportunity to simultaneously present their entries. No importer may present an entry for a quantity in excess of the quota limit.

If the quantity of quota merchandise covered by the entries presented for the opening of the quota period exceeds the amount available, the merchandise is released on a pro rata basis (i.e., the ratio between the quota limit and the total quantity presented for entry).

Quotas not filled at the official opening of the quota period are thereafter administered on a “first come, first served” basis, that is, in the order that each entry/entry summary is presented.

Detailed information on quota quantities, quota periods, and quota allocations for the commodities listed may be obtained from the Customs and Border Protection, Office of Trade, Trade Policy and Programs, Interagency Collaboration Division, Washington, DC.

Note: The 19 U.S. Code § 3601 (Administration of tariff-rate quotas) deals with the implementation of the tariff-rate quotas set out in Schedule XX for the entry, or withdrawal from warehouse, for consumption of goods in the United States.

Absolute Quotas

Absolute quotas limit the quantity of certain goods that may enter the commerce of the United States during a specific period. Once the quantity permitted under an absolute quota is filled, no further entries or withdrawals from warehouse for consumption of merchandise subject to the quota are permitted for the remainder of the quota period.

Importers may hold shipments in excess of a specified absolute quota limit until the opening of the next quota period by entering the goods into a foreign trade zone or bonded warehouse. The goods may also be exported or destroyed under the U.S. Customs and Border Protection supervision.

Tariff Rate Quota Administration

Tariff-Rate Quotas

Tariff rate quotas (TRQs) permit a specified quantity of imported merchandise to be entered at a reduced rate of duty during the quota period. There is no limitation on the amount of merchandise that may be imported into the United States, however, quantities entered in excess of the quota limit during that period are subject to a higher duty rate.

If the importer has not taken possession of the goods, and elects not to pay the higher rate of duty, they may enter the goods into a foreign trade zone or bonded warehouse until the opening of the next quota period, or export or destroy the goods under the U.S. Customs and Border Protection supervision.

Once the U.S. Customs and Border Protection determines the date and time a quota is filled, field officers are authorized to make the required duty rate adjustments on the portion of the merchandise not entitled to quota preference.

Tariff-Preference Levels

Many Free Trade Agreements (FTAs) and other special trade legislation establish Tariff Preference Levels (TPLs) that the U.S. Customs and Border Protection administers like tariff rate quotas. TPLs also permit a specified quantity of imported merchandise to be entered at a reduced rate of duty during the quota period. There is no limitation on the amount of merchandise that may be imported into the United States, however, quantities entered in excess of the quota limit during that period are not entitled to benefits and are subject to a higher duty rate.

If the importer has not taken possession of the goods, and elects not to pay the higher rate of duty, they may enter the goods into a foreign trade zone or bonded warehouse until the opening of the next quota period and reenter the goods with revised certificate/license documentation (as needed), or export or destroy the goods under the U.S. Customs and Border Protection supervision.

Once the U.S. Customs and Border Protection determines the date and time a quota is filled, field officers are authorized to make the required duty rate adjustments on the portion of the merchandise not entitled to quota preference.

Import Goods

Import quotas control the amount or volume of various commodities that can be imported into the United States during a specified period of time. Quotas are established by legislation, Presidential Proclamations or Executive Orders. Quotas are announced in specific legislation or may be provided for in the Harmonized Tariff Schedule of the United States (HTSUS).

Quota Administration Policy

In relation to fisheries and quota policy, see the Australian legal encyclopedia.

Resources

See Also

• Quota
• Tariff
• Import Quota
• Duty Drawback
• Burke-hartke Quota Bill
• Customs Border Protection
• Customs Border Protection Enforcement
• Customs Duty