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Courts Will Defer to Customs Service Rules When Tariff Law Unclear
Description Supreme Court held that the courts will grant deference to the Customs Service when it writes regulations regarding tariffs that clarify parts of the tariff statutes that are unclear as to particular goods or services. So long as Customs is reasonable in its interpretation, its rules should stand.
Topic International Law
Key Words Customs Duties; Rulemaking
C A S E   S U M M A R Y
Facts Haggar cut material for men's pants in the U.S., sent the material to Mexico for sewing, then it was shipped back to the U.S. for sale. The Customs Service applied a higher tariff rate to the pants because after they were sewn in Mexico, a permapress treatment was added to the pants. Customs held that was an operation "incidental to the assembly process" that made the pants subject to a higher tariff than if the permapress had not been added. Haggar sued for a refund of the tariff, contending that the Customs Service regulations were not consistent with the tariff law passed by Congress. The Court of International Trade and the Court of Appeals agreed with Haggar; the Customs Service appealed.
Decision Reversed. The regulations issued by Customs, under the authority the agency was granted by Congress, is entitled to deference by the courts under the standard set by the Supreme Court in Chevron. The regulation was a reasonable interpretation of an ambiguous statutory provision of the Harmonized Tariff Schedule.
Citation U.S. v. Haggar Apparel Co., 119 S.Ct. 1392 (1999)

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