New Section 301 duties on most Nicaraguan imports (0%→10%→15% from 2026–2028) via HTS 9903.89.01 and a future 2027 increase to China 9903.91.05 rates.

This notice from the Office of the U.S. Trade Representative is immediately actionable for U.S. importers.

Section 301 action on Nicaragua

The document implements the Section 301 determination against Nicaragua by modifying subchapter III of chapter 99 of the HTSUS, effective January 1, 2026. A new Chapter 99 heading, 9903.89.01, is created to impose additional duties on articles that are products of Nicaragua.

Scope of coverage

Heading 9903.89.01 applies to products of Nicaragua that are subject to column 1-General rates of duty. Critically, the additional duties do NOT apply to originating goods of Nicaragua under CAFTA–DR, as defined in General Note 29. Thus, the measure targets Nicaraguan-origin goods that either do not qualify for CAFTA–DR origin or for which CAFTA–DR benefits are not properly claimed.

The note explicitly states that, notwithstanding U.S. note 1 to subchapter III of chapter 99, articles of Nicaragua subject to 9903.89.01 are also subject to additional duties imposed by heading 9903.02.47. This means the new 9903.89.01 duties are cumulative with existing Section 301 or other additional duties under 9903.02.47.

Phase-in of additional duties

Additional U.S. note 29(b) sets a phased schedule for the 9903.89.01 additional duty (column 1-General):

• Entries from January 1, 2026 through December 31, 2026: 0% additional duty.
• Entries from January 1, 2027 through December 31, 2027: 10% additional duty.
• Entries on or after January 1, 2028: 15% additional duty.

These percentages are applied on top of the underlying column 1-General rate for the applicable HTSUS subheading. For 2026, the heading is in place but the additional rate is 0%, so classification and reporting changes are required even though there is no incremental duty that year.

Interaction with Chapter 98 provisions

The note clarifies that 9903.89.01 does not apply to goods properly entered under Chapter 98, except for subheadings 9802.00.40, 9802.00.50, 9802.00.60, and heading 9802.00.80. For these exceptions:

• 9802.00.40, 9802.00.50, 9802.00.60: the additional duty applies to the value of repairs, alterations, or processing performed abroad.
• 9802.00.80: the additional duty applies to the value of the article less the cost or value of U.S. products.

Thus, importers using 9802 programs for Nicaraguan processing must calculate the 9903.89.01 additional duty on the foreign value portion, at 0% in 2026, 10% in 2027, and 15% from 2028 onward.

Foreign trade zones

The notice states that any product covered by the Annex, admitted into a U.S. foreign trade zone on or after the effective date of the additional duties, may only be admitted in privileged foreign status (except goods eligible for domestic status). Upon entry for consumption, such goods will be subject to the applicable ad valorem rates and quantitative limitations, including the 9903.89.01 additional duty once it is above 0%. FTZ operators handling Nicaraguan goods must adjust admission practices accordingly starting January 1, 2026.

Practical implications for Nicaraguan imports

From a compliance standpoint:

• As of January 1, 2026, all covered Nicaraguan-origin imports must be flagged with 9903.89.01 in addition to their normal HTSUS classification, even though the additional duty rate is 0% for that year.
• Importers should rigorously document and claim CAFTA–DR origin where applicable to avoid the new additional duties in 2027 and beyond.
• For non-CAFTA–DR qualifying Nicaraguan goods, landed cost models must be updated to reflect a 10% additional duty in 2027 and 15% from 2028, on top of existing duties and any 9903.02.47 duties.
• For 9802 entries, systems must be able to compute the additional duty on the foreign value component.

Amendment affecting Chinese products under 9903.91.05

Separately, the notice modifies subdivision (f) of U.S. note 31 to subchapter III of chapter 99. It restructures the note and adds new subdivision (f)(ii), which states that the additional rate of duty under heading 9903.91.05 will be increased on June 23, 2027. The specific amount of the increase is not provided here; USTR will announce the amount in a separate Federal Register notice issued at least 30 days before June 23, 2027.

The text lists a series of HS codes (e.g., 2804.61.00, 3818.00.00, 8541.10.00, 8541.21.00, 8541.29.00, 8541.30.00, 8541.49.10, 8541.49.70, 8541.49.80, 8541.49.95, 8541.51.00, 8541.59.00, 8541.90.00, 8542.31.00, 8542.32.00, 8542.33.00, 8542.39.00, 8542.90.00) describing silicon, doped elements, diodes, transistors, photosensitive devices, semiconductor devices, and integrated circuits and parts. These are associated with products of China provided for in heading 9903.91.05 and described in note 31(f)(ii). The document confirms that these Chinese products remain subject to any applicable antidumping, countervailing, or other duties, and that the additional 9903.91.05 rate will increase on June 23, 2027, but the numerical change is deferred to a later notice.

Action items for importers and brokers

1) Nicaraguan-origin goods:

• From January 1, 2026, ensure that all non‑CAFTA–DR originating Nicaraguan goods subject to column 1-General duties are declared with 9903.89.01 in addition to their standard HTSUS classification.
• Confirm and document CAFTA–DR origin where applicable to avoid the additional duties.
• For 9802.00.40, 9802.00.50, 9802.00.60, and 9802.00.80 entries from Nicaragua, configure systems to calculate the 9903.89.01 additional duty on the foreign value portion at 0% (2026), 10% (2027), and 15% (2028+).
• Coordinate with FTZ operators to admit covered Nicaraguan goods in privileged foreign status from January 1, 2026.
• Update landed cost and sourcing analyses to account for the 10% and 15% additional duties in 2027 and 2028.

2) Chinese semiconductor and related products under 9903.91.05:

• Identify imports of Chinese-origin products falling under the listed HS codes and heading 9903.91.05.
• Monitor for the forthcoming Federal Register notice specifying the new additional duty rate effective June 23, 2027.
• Plan for potential cost increases and system updates once the new rate is announced.

Priority and risk

This action is high priority for any importer sourcing from Nicaragua, as it introduces a new Chapter 99 requirement immediately (2026) and significant duty increases in 2027 and 2028. It is also relevant for importers of Chinese semiconductors and related products, who must anticipate a future rate increase under 9903.91.05 on June 23, 2027, though the exact magnitude is not yet known.