U.S.–Japan Trade and Investment Deal in Effect Sept. 16 (Updated CBP Guidance)

Trade Update • Updated Sept. 15, 2025

Key Points

• Japan commits $550 billion to rebuild U.S. industries and create hundreds of thousands of jobs.
• Tariff cuts take effect Sept. 16, 2025 on automobiles and auto parts as per Commerce. On this date all Japanese imports entering the U.S. will be subject to a baseline 15% tariff unless their current most-favored nation (MFN) rate is already above that threshold.
• Executive Order issued September 4, 2025, enforces the deal with retroactive tariffs, exemptions, and compliance monitoring.
• Imports from Japan will be subject to a 15% baseline tariff to ensure fair trade and reduce the trade deficit.
• Refunds may be claimed retroactively for entries made on or after August 7, 2025.
• Certain sectors, including aerospace products, natural resources not produced in the U.S., and generic pharmaceuticals, will receive special tariff treatment.
• CBP’s updated guidance issued September 15, 2025, provides instructions on tariffs, exemptions, and retroactive refund procedures.

President Trump announced a landmark Strategic Trade and Investment Agreement with Japan, one of America’s largest trading partners. The deal targets expanded U.S. exports, substantial Japanese investment, and balanced trade rules to boost American industry, create well-paying jobs, and strengthen the bilateral economic partnership.

Updated CBP Guidance

On September 15, 2025, CBP issued updated guidance that modifies IEEPA and Section 232 tariffs on Japanese imports, providing detailed instructions on the application of the new baseline 15% tariff, sector-specific exemptions, and procedures for retroactive refunds.

Additional CBP Instructions Based on the Updated Guidance

• HTSUS Headings Deployment: New headings 9903.02.72, 9903.02.73 (general imports), 9903.94.40–.43 (automobiles and auto parts), and 9903.96.02 (civil aircraft) will be deployed in ACE at 12:01 a.m. EDT, September 16, 2025. Filers should update previously filed entries to reflect these new numbers as soon as possible, within 10 days of cargo release.

• Ad Valorem Conversion for Specific or Compound Duties: For products subject to specific or compound duties, the ad valorem equivalent is calculated by dividing the duty amount by the customs value of the product. Example: 50 cents per kilogram duty on a $10/kg product = 5% ad valorem.

• Entry Summary Sequencing: For entries with multiple HTSUS numbers:

  1. Chapter 98 subheading (if applicable.

  2. Chapter 99 heading(s) for additional duties, in this order if applicable: Section 301, IEEPA Fentanyl, IEEPA Reciprocal, Section 232/201 duties, Section 201/232 quota

  3. Replacement duties (e.g., MTB)

  4. Other quota duties (not covered above)

  5. Chapter 1–97 commodity subheading reporting the entered value

• Liquidation and Refund Guidance:

  • For unliquidated entries with estimated duties already deposited, refunds may be requested via Post Summary Correction (PSC).

  • For liquidated entries, refunds may be requested by filing a protest under 19 U.S.C. 1514.

• Civil Aircraft Clarification: Civil aircraft, their engines, parts, subassemblies, and ground flight simulators that meet WTO and General Note 6 HTSUS criteria are now exempt from additional tariffs, regardless of whether they are entered under a “Free (C)” duty provision.

• Section 232 Products: Products subject to Section 232 duties continue to be exempt from reciprocal tariffs, and automobiles/parts under 9903.94.40 and 9903.94.42 are not considered subject to Section 232 duties for stacking purposes.

• CBP Contact Guidance: Questions regarding entry filing, sequencing, or refunds should be directed to the ACE Help Desk or Trade Remedy at traderemedy@cbp.dhs.gov.

Previous Updates

The agreement has since been formally implemented through a September 4, 2025 Executive Order, which sets tariff rules, outlines exemptions, and establishes monitoring to ensure Japan’s compliance. White House also released a Fact Sheet that provides an overview of the agreement’s key provisions, implementation plans, and benefits for U.S. producers and industries.

On Sept. 5, 2025, CBP issued an interim guidance advising the trade community to await CBP instructions before submitting PSCs or protests related to retroactive tariff refunds. Importers should contact CBP representatives or the Automated Commercial Environment (ACE) Help Desk for entry filing issues and provide an email address for trade remedy inquiries.

Commerce announced that tariff cuts for Japanese automobiles and auto parts will take effect on Sept. 16, 2025.

Agreement Highlights

• $550 Billion Japanese Investment: Directed by the U.S., funds will revive industries like energy, semiconductors, critical minerals, pharmaceuticals, and shipbuilding. The U.S. keeps 90% of profits, benefiting workers and communities. Beginning Sept. 16, 2025, all Japanese imports entering the U.S. will be subject to a baseline 15% tariff unless their current most-favored nation (MFN) rate is already above that threshold.

• New Tariff Framework:

  • All Japanese imports entering the U.S. will be subject to a baseline 15% tariff, unless their current tariff rate is already above that threshold. Goods with an MFN rate higher than 15% will not owe additional tariffs. If specific or compound duty rates apply, the methodology follows the July 31 Executive Order issued for EU goods.

  • The tariffs apply retroactively to imports made on or after August 7, 2025, with refunds processed under U.S. Customs and Border Protection procedures. Importers are encouraged to review entries with brokers for refund eligibility.

  • Refunds may be claimed retroactively for entries made on or after August 7, 2025. However, these claims must be submitted via Post Summary Correction (PSC) once CBP programming is finalized.

• • The Executive Order also directs publication of Harmonized Tariff Schedule (HTSUS) modifications in the Federal Register within seven days of the order.

• Most-favored nation (MFN):
  • Goods from Japan with an MFN rate of ≤ 15% will be assessed a flat 15% MFN plus reciprocal rate. These goods must be filed under subheading 9903.94.41 for cars and trucks, 9903.94.43 for auto parts, and 9903.02.73 for all other goods.

• • Goods with an MFN rate of > 15% will only pay the MFN rate. These must be filed under subheading 9903.94.40 for cars and trucks, 9903.94.42 for auto parts, and 9903.02.72 for all other goods.

• Section-Specific Tariff Rules:

• • Aerospace/Aircraft Parts: Japanese civil aircraft products, except unmanned aircraft, will no longer face U.S. tariffs. Exempt from both Section 232 tariffs (steel, aluminum, copper) and reciprocal tariffs, filed under 9903.96.02.

  • Automobiles and Auto Parts: Section 232 tariffs on Japanese vehicles and components are replaced with the new 15% baseline tariff framework, effective Sept. 16, 2025.

  • Exemptions: No tariffs will apply to Japanese exports of natural resources unavailable in the U.S., as well as generic pharmaceuticals, ingredients, and chemical precursors.

• Expanded U.S. Market Access in Japan: The agreement opens significant new opportunities for American producers across the following industries:

• • Agriculture: Japan will increase U.S. rice imports by 75% and commit to $8 billion in purchases of corn, soybeans, fertilizer, bioethanol, and sustainable aviation fuel.

• • Energy: Significant expansions in U.S. energy exports, including new potential agreements for Alaskan liquefied natural gas (LNG).

• • Aerospace & Defense: Japan commits to purchase 100 Boeing commercial aircraft and billions in U.S. defense equipment

• • Automobiles: Restrictions on U.S.-made cars and trucks are lifted, and U.S. vehicle environmental and safety standards will be formally accepted in Japan for the first time.

Implementation and Enforcement

The Executive Order released September 4, 2025, formally links the deal to U.S. national security laws under section 232 and prior presidential proclamations on steel, aluminum, autos, and copper.

The U.S. Secretary of Commerce, in consultation with the U.S. Trade Representative and U.S. Customs and Border Protection, will oversee tariff application and update the Harmonized Tariff Schedule of the United States (HTSUS) as needed.

The order directs ongoing monitoring of Japan’s compliance. If Japan fails to meet its commitments, the U.S. may adjust or reimpose tariffs to safeguard national security and trade interests.

White House Fact Sheet on U.S.–Japan Trade Agreement

The White House’s Fact Sheet outlines the key benefits and implementation details of the agreement, highlighting expanded market access and investment commitments:

• The agreement provides American producers and manufacturers with over $15 billion of market access in Japan while accounting for U.S. national security needs.

• Japan will expedite the implementation of the 75% increase in U.S. rice purchases.

• Japan will make stable, long-term purchases of U.S. energy, including $7 billion per year in liquefied natural gas (LNG).

• Clean Energy Vehicle Introduction Promotion Subsidies will support American cars entering the Japanese market.

Key Considerations Before Filing a PSC for Refund

• Cost vs. Benefit: The administrative cost of filing may exceed the refund amount.
• Liquidation Trigger: Filing a PSC will initiate entry liquidation, starting the 180-day protest period.
• Legal Uncertainty: If the Supreme Court overturns the IEEPA tariffs:
• A second refund claim may be required for IEEPA-related duties.
• The protest window may fall outside the decision timeline, potentially impacting eligibility.

Tip: The GHY team is available to assist with refund strategies, PSC filing, and navigating potential legal developments. Please reach out with any questions.

Impact on Strategic Partnership

The Strategic Trade and Investment Agreement changes U.S.-Japan economic ties to focus on supporting American industry, innovation, and workers. It helps revive key industries, strengthen supply chains, and build stronger economic and security partnerships.

How GHY Can Help?

GHY specializes in helping businesses navigate and reduce the impacts of tariffs through strategic solutions tailored to their needs. Our experts can audit your supply chain to identify inefficiencies, uncover cost-saving opportunities, and ensure compliance with evolving trade regulations. We also employ tariff engineering techniques to optimize product classification and sourcing strategies, minimizing duty exposure and maximizing profitability.

By partnering with GHY, your business gains access to the tools and expertise needed to streamline operations and stay competitive in a challenging trade environment.

Contact Us Today! Booking a Meeting, email consult@ghy.com, or call +1 (800) 667-0771.