New Section 232 action imposes a 25% additional duty via HTSUS 9903.79.01 on certain advanced AI semiconductors effective Jan. 15, 2026, with broad end‑use exemptions.

REGULATORY BRIEFING – SECTION 232 ACTION ON ADVANCED SEMICONDUCTORS

1. What Changed

• A new Section 232 national security action adjusts imports of certain advanced computing semiconductors and derivative products.
• Effective 12:01 a.m. EST on January 15, 2026, an additional 25% ad valorem duty is imposed via new HTSUS Chapter 99 heading 9903.79.01 on defined “semiconductor articles,” in addition to the normal HTS duty.
• The measure is implemented through a new U.S. Note 39 to Subchapter III of Chapter 99 and new headings 9903.79.01–9903.79.09.
• The action is open-ended (no stated expiration) and may be modified after market review by July 1, 2026.
• Covered products are carved out from several other Section 232/301-type additional duties; no drawback is permitted on the new 25% duty.

2. Affected Products and HTS Codes

2.1 Base HTS Classifications

The measure targets imported products that:

• Are classifiable in one of the following HTSUS headings:
• 8471.50 (Processing units other than those of subheading 8471.41 or 8471.49, whether or not containing in the same housing one or two of the following types of units: storage units, input units, output units)
• 8471.80 (Other units of automatic data processing machines)
• 8473.30 (Parts and accessories of the machines of heading 8471)

AND

• Are a logic integrated circuit, or an article that contains a logic integrated circuit, that meets specific performance and DRAM bandwidth thresholds (see below).

2.2 Technical Definition of “Semiconductor Articles” (U.S. Note 39(b))

“Semiconductor articles” for purposes of 9903.79.01 are imported products that:

• Are logic integrated circuits or articles containing such circuits; and
• Meet one of the following performance/bandwidth parameter sets:

1) Total processing performance (TPP) > 14,000 and < 17,500 AND total DRAM bandwidth > 4,500 GB/s and < 5,000 GB/s; OR

2) TPP > 20,800 and < 21,100 AND total DRAM bandwidth > 5,800 GB/s and < 6,200 GB/s.

Key definitions:

• TPP = 2 × MacTOPS × bit length of the operation, aggregated over all processing units on the IC.
• MacTOPS = theoretical peak Tera operations per second for multiply-accumulate (D = A × B + C).
• Bit length of the operation = largest bit length of the inputs to the multiply operation.
• Total DRAM bandwidth = aggregate GB/s between the IC and DRAM ICs (copackaged, e.g., HBM, and non-copackaged, e.g., GDDR), excluding remote DRAM over interconnect.

Examples:

• A chip with 300 MacTOPS at 16-bit operations: TPP = 2 × 300 × 16 = 9,600 (not in the 14,000–17,500 or 20,800–21,100 bands).
• A chip with 300 MacTOPS at 32-bit operations: TPP = 2 × 300 × 32 = 19,200 (still outside the specified bands).
• Importers must use manufacturer datasheets to determine MacTOPS and supported bit lengths and compute TPP.

2.3 Chapter 99 Structure

New U.S. Note 39 and headings:

• 9903.79.01 – Semiconductor articles as defined in Note 39(a) and (b); subject to base duty + 25% additional duty.
• 9903.79.02 – Articles in 8471.50, 8471.80, 8473.30 that do NOT meet the Note 39(b) technical parameters (i.e., not “semiconductor articles”); no additional 25% duty.
• 9903.79.03–9903.79.09 – Same technical “semiconductor articles” as 9903.79.01, but for specified exempt end uses; no additional 25% duty (only base HTS duty applies).

3. Rate Changes

3.1 New Additional Duty

• For qualifying “semiconductor articles” under 9903.79.01:
• Old rate: Base HTS duty rate under 8471.50 / 8471.80 / 8473.30 (often 0% MFN, but depends on specific subheading and origin) plus any applicable trade remedies.
• New rate: Base HTS duty rate under the applicable subheading + 25% ad valorem under 9903.79.01.
• The 25% is applied on top of the ordinary customs duty and any special FTA rate (if applicable). It is in addition to ADD/CVD and other charges, except where specifically excluded.

3.2 Exempt End-Use Categories (No 25% Additional Duty)

Semiconductor articles that otherwise meet Note 39(b) are excluded from 9903.79.01 and instead entered under:

• 9903.79.03 – For use in U.S. data centers.
• “U.S. data center” = facility requiring >100 MW of new load dedicated to AI inference, training, simulation, or synthetic data generation.
• 9903.79.04 – For repairs or replacements performed in the United States.
• 9903.79.05 – For research and development in the United States.
• R&D defined as systematic study toward new knowledge or application, including design, development, and improvement of prototypes and new processes.
• 9903.79.06 – For use by startups in the United States.
• “Startup” = “emerging growth company” as defined at 15 U.S.C. § 77b(a)(19).
• 9903.79.07 – For use in non-data center consumer electronics applications in the United States, including gaming, personal computing, professional visualization, workstation applications, and automotive applications.
• 9903.79.08 – For use in non-data center civil industrial applications in the United States, including factory robotics and industrial machinery.
• 9903.79.09 – For use in United States public sector applications.

For 9903.79.03–.09:

• Rate: “The duty provided in the applicable subheading” (i.e., no extra 25%).

3.3 Interaction with Other Trade Remedies

Per U.S. Note 39(a) and related note changes:

• Semiconductor articles under 9903.79.01 remain subject to:
• All antidumping (AD) and countervailing (CVD) duties.
• Other duties and charges, except as specifically excluded.
• They are NOT subject to certain other additional duties, including:
• Passenger vehicles/light trucks: 9903.94.01, .94.03, .94.31, .94.40, .94.41, .94.50, .94.51, .94.60, .94.61.
• Parts for passenger vehicles/light trucks: 9903.94.05, .94.07, .94.32, .94.33, .94.42, .94.43, .94.44, .94.45, .94.52, .94.53, .94.54, .94.55, .94.62, .94.63, .94.64, .94.65.
• Medium- and heavy-duty vehicles and parts: 9903.74.01, .74.02, .74.03, .74.08, .74.09.
• Semi-finished copper and copper-intensive derivatives: 9903.78.01.
• Aluminum and derivative aluminum products: 9903.85.02, .85.12, .85.04, .85.07, .85.08, .85.13, .85.14, .85.15.
• Iron or steel and derivative products: 9903.81.87, .81.88, .81.94, .81.95, .81.89, .81.90, .81.91, .81.93, .81.96, .81.97, .81.98, .81.99.
• Certain Canada- and Mexico-specific duties: 9903.01.10 (Canada), 9903.01.01 (Mexico).
• A wide range of other additional duties under 9903.01.24–9903.01.76 and 9903.02.01–9903.02.71 (various Section 301/other measures).
• Additional notes (U.S. notes 2(v), 2(x), 2(z)) are amended so that certain 9903.01.xx and 9903.02.xx additional duties do not apply to semiconductor articles under 9903.79.01.
• The proclamation also states that Covered Products subject to this new tariff are not subject to duties imposed by:
• Executive Order 14257 (reciprocal tariff for trade deficits),
• Executive Order 14193 (northern border illicit drugs),
• Executive Order 14194 (southern border situation).

3.4 Drawback and Foreign-Trade Zones

• No drawback: “No drawback shall be available with respect to the duties imposed pursuant to this proclamation.”
• FTZ treatment:
• Any covered product (other than those admitted as “domestic status” under 19 CFR 146.43) admitted into a U.S. FTZ on or after the effective date must be admitted as “privileged foreign status” (19 CFR 146.41).
• Upon entry for consumption, such goods will be subject to the applicable ad valorem rates, including the 25% where 9903.79.01 applies.

4. Key Dates

• Effective date/time: 12:01 a.m. Eastern Standard Time, January 15, 2026.
• Duration: Indefinite, “shall continue in effect, unless such action is expressly reduced, modified, or terminated.”
• Negotiation update: Secretary of Commerce and USTR must update the President on related negotiations within 90 days of January 14, 2026.
• Market review: By July 1, 2026, the Secretary must provide an update on the market for semiconductors used in U.S. data centers to inform potential modification of the tariff.

5. Required Actions for Importers, Brokers, and Compliance Teams

5.1 Product Scoping and Classification

• Identify all imports under HTSUS headings 8471.50, 8471.80, and 8473.30.
• For each product, determine whether it is or contains a logic integrated circuit used for AI or high-performance computing.
• Obtain detailed technical specifications from manufacturers, including:
• MacTOPS (or equivalent TOPS/FLOPS) at each supported bit length.
• Supported bit lengths for multiply-accumulate operations.
• DRAM configuration and total DRAM bandwidth (GB/s) between the IC and DRAM (HBM, GDDR, etc.).
• Calculate TPP per U.S. Note 39(b) and confirm whether the product falls within:
• TPP > 14,000 and < 17,500 with DRAM bandwidth > 4,500 and < 5,000 GB/s; or
• TPP > 20,800 and < 21,100 with DRAM bandwidth > 5,800 and < 6,200 GB/s.
• If the product meets these thresholds and is in 8471.50/8471.80/8473.30, treat it as a “semiconductor article” for Chapter 99 purposes.

5.2 Chapter 99 Declaration and End-Use Management

• For each entry of a semiconductor article, determine the intended U.S. end use at the time of import.
• If the product is a semiconductor article and NOT qualifying for an exempt end use:
• Declare HTSUS 9903.79.01 in addition to the base HTS classification.
• Pay base duty + 25% additional duty.
• If the product is a semiconductor article and qualifies for an exempt end use:
• Use the appropriate Chapter 99 heading:
• 9903.79.03 – U.S. data centers (>100 MW new AI load).
• 9903.79.04 – Repairs/replacements in the U.S.
• 9903.79.05 – R&D in the U.S.
• 9903.79.06 – Use by U.S. startups (emerging growth companies).
• 9903.79.07 – Non-data center consumer electronics (gaming, PCs, visualization, workstations, automotive, etc.).
• 9903.79.08 – Non-data center civil industrial (factory robotics, industrial machinery).
• 9903.79.09 – U.S. public sector applications.
• Ensure that only the base HTS duty is assessed (no 25% additional duty).
• If the product is in 8471.50/8471.80/8473.30 but does NOT meet the Note 39(b) technical thresholds:
• Use 9903.79.02 (no additional 25% duty) where required by CBP guidance.

5.3 Documentation and Certification

• Develop internal end-use certification templates to support claims under 9903.79.03–.09, including:
• Detailed description of the end-use application.
• Identification of the facility (for data centers, including evidence of >100 MW new AI load).
• For R&D, documentation of R&D project scope and activities.
• For startups, evidence of “emerging growth company” status under 15 U.S.C. § 77b(a)(19).
• For public sector uses, contracts or purchase orders from government entities.
• Maintain technical documentation supporting TPP and DRAM bandwidth calculations (manufacturer datasheets, engineering specs, internal calculations).
• Expect CBP to require end-use statements or certifications at entry or post-entry; monitor Federal Register notices for specific CBP procedures.

5.4 Costing, Sourcing, and Contracting

• Update landed cost models for affected semiconductor articles that will fall under 9903.79.01 (25% additional duty).
• Review supply contracts with customers to:
• Address who bears the cost of the new 25% duty.
• Incorporate clauses for tariff changes and re-pricing.
• Evaluate alternative sourcing or product configurations that:
• Use chips outside the specified TPP/DRAM bands, or
• Qualify for exempt end uses (e.g., R&D, repairs, consumer/industrial applications) where legitimately applicable.

5.5 FTZ and Drawback Strategy

• For FTZ operators:
• Ensure that covered semiconductor articles admitted on or after January 15, 2026, are admitted as privileged foreign status.
• Model the impact of the 25% duty on downstream products when entered for consumption.
• For drawback filers:
• Cease planning to claim drawback on the 25% duties under 9903.79.01; these duties are non-drawbackable.

5.6 Monitoring and Future Changes

• Monitor:
• Federal Register notices from Commerce and CBP implementing HTSUS modifications, end-use certification requirements, and any clarifications.
• Potential expansion of Section 232 tariffs to broader semiconductor categories and semiconductor manufacturing equipment after ongoing negotiations.
• The July 1, 2026 review outcome, which may adjust the scope or rate, particularly for data center-related chips.

6. References

• Proclamation: “Adjusting Imports of Semiconductors, Semiconductor Manufacturing Equipment, and Their Derivative Products into the United States,” January 14, 2026 (White House Presidential Actions – Proclamations).
• Annex (HTSUS modifications and U.S. Note 39):
• PDF: https://www.whitehouse.gov/wp-content/uploads/2026/01/2026SemiConductor.prc_.rel-ANNEX.pdf
• Relevant statutes and regulations:
• Section 232, Trade Expansion Act of 1962 (19 U.S.C. 1862).
• Section 604, Trade Act of 1974 (19 U.S.C. 2483).
• 19 CFR Part 146 (Foreign-Trade Zones), especially 146.41 (privileged foreign status) and 146.43 (domestic status).
• 15 U.S.C. § 77b(a)(19) (definition of “emerging growth company”).

Actionable next step: Immediately inventory all imports under HTS 8471.50, 8471.80, and 8473.30, determine which products meet the Note 39(b) thresholds, map them to appropriate 9903.79.xx headings based on end use, and update entry, documentation, and costing processes for shipments on or after January 15, 2026.