Tuesday, June 22, 2010

Free Trade Tuesday - Singapore

Implemented in 2004, the United States-Singapore Free Trade Agreement (SFTA) eliminates tariffs on most goods originating in the United States and Singapore over a maximum transition period of ten years. There is no expiration date and duties on eligible goods should be phased out by 2013.

The rules of origin for goods that are not wholly obtained from the United States or Singapore are based on a tariff-shift method and/or regional value-content method similar to the rules under NAFTA. When it is necessary to use the RVC, SFTA uses a “build-up & build down” calculation. A notable difference in the SFTA is that the responsibility is on the importer, rather than the exporter, to demonstrate that a good qualifies for preferential tariff treatment. Eligible goods are designated by the letters "SG" in the Special subcolumn.

Special Requirements

Generally, under the SFTA, a non-textile good will qualify for preferential tariff treatment as a "product of Singapore" if:
  • The good is wholly obtained or produced entirely in Singapore, the U.S. or both, or,
  • Each non-originating material used in the production of the good imported from Singapore undergoes the specified tariff shift, or the good otherwise satisfies applicable Regional Value Content.
Goods that qualify for preferential tariff treatment are not subject to the Merchandise Processing Fee (MPF), though textile merchandise entered under TPL numbers 9910 will still be subject to MPF.

Tariff Preference Levels (TPLs) have been established for certain apparel products of cotton and man-made fibers, to allow entry under a reduced duty rate up to a specific quantity of goods that are not originating goods. Once that quantity is reached, the product is dutiable at the column 1 rate and MPF is due. A valid preferential Certificate of Origin/Eligibility (Certificate) is required whenever a TPL claim is made. This Certificate must be an original and must be filed with the entry documents. If a good does not qualify as originating under SFTA or under the established TPLs, but it is still considered a product of Singapore, then the normal column 1 rate would apply, and MPF is due.

SFTA - Key Facts

Expiration: N/A

HTS General Note:
GN 25

Imported Directly:
Yes - unloading/reloading in third countries allowed. No additional production allowed.


De Minimis:

  • 10% - Non Textiles (Value)
  • 7% - Textiles (Weight)
  • Some Exceptions

Origin Criteria:
  • Tariff Shift
  • RVC - Build-up/Build-down
  • Accumulation
MPF: Originating Goods Exempt
Countries: Singapore, United States
Related Regulations: 19 CFR 10.501 – 10.570

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