Tariffs and FDA Compliance: How US Trade Policy Affects Foreign Manufacturers Exporting to America

Foreign manufacturers exporting to the United States face two parallel compliance frameworks at the border: FDA regulatory compliance (ensuring the product meets US safety, labeling, and registration requirements) and customs compliance (ensuring the product is properly classified, valued, and that applicable duties are paid). These two frameworks are administered by different agencies — the FDA and US Customs and Border Protection (CBP) — but they interact at the point of import, and failures in either framework can result in the shipment being held. For foreign manufacturers, understanding both frameworks is essential for accurate cost planning, smooth customs clearance, and avoiding unexpected charges or delays.

HTS classification and its FDA implications

Every product imported into the United States must be classified under the Harmonized Tariff Schedule (HTS), which determines the applicable duty rate. The HTS classification also has FDA implications — certain HTS codes are flagged for FDA review, and the HTS code must be consistent with the FDA product code used in the facility registration and Prior Notice filing. A discrepancy between the HTS classification (which determines tariff treatment) and the FDA product code (which determines regulatory treatment) can trigger additional scrutiny from both agencies. For example, a product classified as a cosmetic for FDA purposes but coded as a drug under the HTS — or vice versa — will raise flags in the electronic screening systems used by both CBP and FDA.

Section 301 tariffs and FDA-regulated products

Section 301 tariffs — additional duties imposed on products from specific countries based on trade policy determinations — have affected many FDA-regulated products, particularly those imported from China. Section 301 tariffs have been applied to food ingredients, pharmaceutical intermediates, medical devices, cosmetic raw materials, and finished products across multiple FDA-regulated categories. These tariffs are in addition to the normal MFN (Most Favored Nation) duty rates and can add 7.5 to 25 percent or more to the landed cost of the product. Foreign manufacturers exporting from countries subject to Section 301 tariffs must factor these additional costs into their pricing and must ensure that their customs broker correctly identifies and pays the applicable Section 301 duties, as underpayment can result in penalties and interest.

Free trade agreements and duty reductions

Products from countries with which the United States has free trade agreements (FTAs) — such as USMCA (United States-Mexico-Canada Agreement), CAFTA-DR (Central America-Dominican Republic), and bilateral FTAs with countries including Australia, Chile, Colombia, Israel, Jordan, South Korea, Morocco, Oman, Panama, Peru, and Singapore — may qualify for reduced or zero duty rates. To claim FTA preferential treatment, the product must meet the agreement's rules of origin, which typically require that the product be substantially transformed in the FTA partner country or that a specified percentage of the product's value originates in the FTA partner country. FTA benefits apply to customs duties only — they do not affect FDA regulatory requirements, which apply regardless of the product's country of origin or trade agreement status.

Country of origin marking

19 CFR Part 134 requires that every article of foreign origin imported into the United States be marked with the English name of the country of origin in a conspicuous location, in a manner that is legible, indelible, and permanent. This requirement applies to all FDA-regulated products and is enforced by CBP (not by the FDA, although mislabeled country of origin can also constitute misbranding under FDA regulations). For products that undergo substantial transformation in a third country before export to the US, the country of origin is the country where the last substantial transformation occurred — not the country where raw materials originated. Mislabeling or omitting the country of origin can result in CBP penalties, marking duties (10 percent of the product's value), and product detention.

Antidumping and countervailing duties

Certain FDA-regulated products — particularly commodity food ingredients, pharmaceutical ingredients, and chemical intermediates — may be subject to antidumping duties (AD) or countervailing duties (CVD) if the US International Trade Commission has determined that the products are being sold in the US at less than fair value or are receiving government subsidies in the exporting country. AD/CVD orders can impose significant additional duties — sometimes exceeding 100 percent of the product's value — on specific products from specific countries. Foreign manufacturers must verify whether their products are subject to AD/CVD orders before shipping to the US, as the duties are assessed at the time of entry and failure to pay can result in the seizure of the shipment.

How FDABridge helps with compliance planning

FDABridge focuses on the FDA compliance side of US market entry — ensuring your facility registrations, US Agent designations, and product filings are current and accurate. While we do not provide customs brokerage or tariff advisory services, our clients benefit from having their FDA compliance in order before engaging customs brokers and trade compliance advisors. Visit fdabridge.com to see our services or fdabridge.com/contact to discuss your US market entry plan.