HMF and MPF

What is a Harbor Maintenance Fee (HMF)?

A harbor maintenance fee or HMF is a “user fee” collected by the U.S. Customs and Border Protection (CBP) for shipments imported via the ocean. “User fees” refer to non-duty or tax charges that are based on the mode of transportation (sea, air, rail, road) or the type of entry (formal vs. informal).

Created by the Water Resource Act of 1986, the HMF was created to share the cost for the construction of harbors, inland waterway transport, and flood-control projects. The fee is collected on imports, domestic shipments, Foreign-Trade Zone (FTZ) admissions, and passengers on cruise ships.

The one exception to this fee is if a shipment is transported via ocean to a Canadian port and then routed into the US.

How is HMF calculated?

The fee is based on the value of the shipment declared on the commercial invoice. HMF will equal 0.125% of the value of cargo and there is no minimum or maximum amount of charge.

What is a Merchandise Processing Fee (MPF)?

Merchandise Processing Fee or MPF is a “user fee” collected by the U.S. Customs and Border Protection (CBP) services for most imports into the US through all modes of transportation. “User fees” refer to non-duty or tax charges that are based on the mode of transportation (sea, air, rail, road) or the type of entry (formal vs. informal). This fee is imposed to offset salary-related expenses.

How is MPF calculated?

The fee is based on the value of the merchandise being imported, not including duty, freight, and insurance charges. MPF is calculated at 0.3464%. The minimum amount is $26.22, with a maximum amount of $508.70. If the entry value is less than $2,500, MPF is a $2.18 flat rate.

For informal entries (imported via mail), MPF is a set fee, which ranges between $2 to $9 per shipment.

Can MPF fees be avoided?

You can be considered MPF- exempt if your import meets ‘preferential status’ under almost all U.S. trade programs and deals.

Exempt from MPF:

• African Growth and Opportunity Act (AGOA)

• Caribbean Basin Economic Recovery Act (CBERA)

• Caribbean Basin Trade Partnership Act (CBTPA)

• Dominican Republic-Central America Free Trade Agreement (CAFTA-DR)

• Generalized System of Preferences (GSP)

• North American Free Trade Agreement (NAFTA)- now USMCA

• Australia Free Trade Agreement (AUFTA)

• Bahrain Free Trade Agreement (BHFTA)

• Chile Free Trade Agreement (CLFTA)

• Colombia Trade Promotion Agreement (COTPA)

• Israel Free Trade Area Agreement (ILFTA)

• Korea Free Trade Agreement (KORUS)

• Oman Free Trade Agreement (OMFTA)

• Panama Trade Promotion Agreement (PATPA)

• Peru Trade Promotion Agreement (PETPA)

• Singapore Free Trade Agreement (SGFTA)

Not Exempt from MPF:

• Jordan Free Trade Area Agreement (JOFTA)

• Morocco Free Trade Agreement (MAFTA)