Preferential duties are reduced or zero customs duty rates granted to eligible imported goods under a free trade agreement, trade preference programme, or special customs arrangement. To qualify, goods usually must meet rules of origin, documentation, and direct shipment requirements. Preferential duties can lower landed costs for importers, but they must be claimed correctly with supporting records such as certificates of origin, supplier declarations, or origin statements. These rates are lower than the standard most-favored-nation (MFN) duty rate normally applied to imports from non-FTA countries.
How to Access Preferential Duties
- Verify the product qualifies under the FTA rules of origin
- Obtain or prepare the required certificate of origin or self-certification
- Claim the FTA preference on the customs entry
- Maintain documentation for five years for potential CBP audits
Key U.S. Preferential Programs
- USMCA: duty-free for qualifying Canada and Mexico goods
- GSP (Generalized System of Preferences): developing country exports
- Various bilateral FTAs with Australia, South Korea, Singapore, and others
Related terms: Customs Clearance.
