KUALA LUMPUR: The United States has not provided detailed clarification regarding enforcement implementation categories for transhipment activities according to the Ministry of Investment, Trade and Industry.
MITI confirmed in a parliamentary written reply that President Donald Trump announced a new executive order on reciprocal tariff rates on 31 July 2025.
“The latest US executive order stipulates that goods identified by the United States Customs and Border Protection (CBP) can be subject to tariffs of up to 40 per cent instead of the original reciprocal rate,” it said.
Malaysia faces a 19 percent reciprocal tariff rate effective from 7 August 2025 under this order.
The ministry emphasised that transhipment activities form part of global business strategy and do not inherently conflict with any country’s laws.
“However, transhipment involving the abuse of Certificate of Origin (COO) to circumvent or avoid import duties is an act that violates regulations,” it said.
This response addressed Senator Rita Sarimah Patrick Insol’s query about US tariff impacts on transhipment cargo volumes at Malaysian ports.
MITI has assumed full control over issuing Non-Preferential Certificates of Origin for Malaysian exports to the US since 6 May 2025.
Enhanced NPCO criteria now require goods to be entirely sourced or produced in Malaysia with minimum 25 percent local content.
Significant changes in tariff classification represent another key requirement under the tightened NPCO system.
The ministry has intensified audits of exporting companies and collaborates with US authorities to combat origin-washing practices.
MITI consistently reminds industries that providing false origin information risks damaging Malaysia’s reputation and triggering trade sanctions.
The government continues monitoring developments to maintain Malaysia’s position as a transparent and trusted regional logistics hub. – Bernama
