On July 31, 2025, President Trump signed an Executive Order (“E.O.”) modifying reciprocal tariffs that became effective on August 7, 2025. Some aspects of the impact are well understood such as increased
On July 31, 2025, President Trump signed an Executive Order (“E.O.”) modifying reciprocal tariffs that became effective on August 7, 2025. Some aspects of the impact are well understood such as increased tariff burden on importers ranging from 10% to over 40%. Still, other aspects of the practical effect and its knock-on effects for shipping are relatively novel. Understanding these measures is essential for all import supply chain participants and their service providers as real impacts on transportation spend and compliance risk come in focus.
The In-Transit Exception
Central to the E.O. is the narrowly defined in-transit exception. Shipments that are loaded onto a vessel at the port of loading before August 7th, and that remain on that same vessel until U.S. entry before October 5, 2025, will bear the pre-existing 10% reciprocal tariff. One key fact that has emerged in recent months is now this relief is limited. Goods that are transferred or transshipped to a different vessel after departure from port of loading after August 7th, which includes feeder vessel service, do not fall under the exception. Such a break in the through movement on the origin vessel means the goods are subject to the full reciprocal
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