Harley-Davidson, the Motorcycle Manufacturer, Overcomes Bahrain Trade Barrier

The Department of Commerce’s International Trade Administration (ITA) helped Harley-Davidson, headquartered in Milwaukee, Wisconsin, overcome a foreign trade barrier that threatened to prevent access of its motorcycles into Bahrain.

Courtesy: Harley-Davidson USA

Why it Matters: If the United States did not assert its rights under the U.S. Bahrain FTA in the case of Harley-Davidson, other American businesses might find themselves losing benefits the U.S. negotiated as part of the agreement.

The Problem: Harley-Davidson was denied duty-free access for its motorcycles manufactured in the United States as provided for under the U.S.-Bahrain Free Trade Agreement (FTA); instead it was charged a 5 % duty. The Government of Bahrain (GOB) claimed that because the motorcycles were not imported directly into Bahrain from the United States and instead were transshipped (shipped through a third country), they therefore did not fulfill the FTA’s rules of origin which would grant Harley-Davidson duty-free access.

The Solution: A team of ITA specialists and representatives from other USG agencies advocated on behalf of Harley-Davidson and provided specific guidance on the FTA rules of origin for transshipped goods which resulted in the GOB allowing for transshipment stop-overs. In addition, ITA and representatives from U.S. Customs and Border Protection provided training to Bahrain customs officers. Due to these efforts, Harley-Davidson was granted duty-free access and has received a refund of all duties paid from the Government of Bahrain. This solution will also benefit other U.S. exporters to Bahrain who transship their products.