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Just a week after announcing the first exclusions from the Section 301 additional 25 percent tariff for List 2 goods from China, the Office of the U.S. Trade Representative has announced the first exclusions for List 3 goods as well. These exclusions cover 10 specially prepared product descriptions that reflect 15 exclusion requests. USTR is also continuing to accept exclusion requests for List 3 goods until Sept. 30.
Initial indications are that the 10 percent tariff, which would be in addition to any other applicable tariffs, will be applied on the entire list of 3,805 full and partial subheadings announced in May. The Office of the U.S. Trade Representative said at that time that this list covers all apparel, footwear, and manufactured textile products, among others, but excludes pharmaceuticals, certain pharmaceutical inputs, select medical goods, rare earth materials, and critical minerals.
Hundreds more requests for exclusions from the Section 301 25 percent additional tariff on imports from China have recently been denied but there have been new approvals as well. The Office of the U.S. Trade Representative is continuing to review outstanding exclusion requests for List 1 and List 2 goods, imports of which are collectively worth about $50 billion, and has set a Sept. 30 deadline for requests for List 3 goods, which are worth about $200 billion.
A new Trump administration policy seeks to prevent countries that meet certain economic and other indicators from utilizing flexibilities for developing countries in World Trade Organization rules and negotiations. China, the primary target of the new policy, denounced it as indicative of the United States’ “wayward arrogance and selfishness” and said it “will bring controversy and chaos, putting new obstacles in the way of WTO reforms.”
The first products excluded from the Section 301 additional 25 percent tariff on List 2 goods from China have been announced by the Office of the U.S. Trade Representative. These exclusions cover 69 specially prepared product descriptions that reflect 292 exclusion requests.
U.S. Customs and Border Protection reports that there was a significant increase in its efforts to enforce trade remedies and other laws in 2018, highlighting some of the risk factors importers need to be aware of and the importance of taking compliance measures to mitigate them.
In a case argued successfully by Sandler, Travis & Rosenberg attorneys, the Court of International Trade ruled recently that certain stringed light sets are properly classified as other electric lamps and lighting fittings under HTSUS 9405.40.8000 (3.9 percent duty) rather than as lighting sets of a kind used for Christmas trees under HTSUS 9405.30.0010 (8 percent duty).
The Office of the U.S. Trade Representative is seeking comments by Aug. 30 on the operation of the Caribbean Basin Initiative (the Caribbean Basin Economic Recovery Act as amended by the Caribbean Basin Trade Partnership Act). USTR will use this information to prepare its biannual report to Congress on the operation of these programs.
As the federal government expands the number of goods imported from China that are excluded from the 25 percent Section 301 tariffs, importers of such goods should take specific steps to maximize their refunds of those tariffs, says Sandler, Travis & Rosenberg customs attorney David Cohen. These include keeping a close eye on liquidation dates and the ever-changing list of excluded goods.
U.S. Customs and Border Protection has announced that starting Aug. 22 it will conduct an approximately one-year test under which additional data elements for Section 321 goods will be transmitted in advance of their arrival. CBP states that it is conducting this voluntary test to determine the feasibility of requiring advance data from different types of parties and requiring additional data that is generally not required under current regulations in order to effectively identify and target high-risk shipments in the e-commerce environment.
The World Trade Organization issued this week a mixed ruling in a long-running case challenging more than a dozen U.S. countervailing duty orders on imports from China. While the U.S. criticized the decision, press reports indicate that it could face retaliatory trade sanctions if it does not comply.
The Trump administration’s willingness to strike a trade deal with China is being seen by some observers as increasingly tied to how doing so may affect the president’s chances of winning the 2020 presidential election. An agreement that secures suitably strong terms for the U.S. could aid Trump’s re-election bid, but if that cannot be accomplished Trump could follow through with threats to hike tariffs on $300+ billion worth of additional imports from China as a show of strength to voters.
The U.S. is moving toward the imposition of higher import tariffs on a wide range of goods from the European Union due to several ongoing trade disputes, raising concerns among EU exporters about their access to an important market. However, the first sale rule is a proven tool that can be used to not only mitigate the impact of any such tariffs but also lower costs well into the future.
President Trump has declined to impose import restrictions on uranium despite a Department of Commerce determination that imports are threatening to impair national security.
Substantially increasing trade and investment between the U.S. and Africa is the goal of the Trump Administration’s new Prosper Africa initiative. Mark Green, administrator of the U.S. Agency for International Development, said this initiative is “a new way of doing business” that “makes the full suite of U.S. government networks and resources available and accessible to importers, exporters, and investors.”
Demonstrating again its willingness to use trade threats to address a wide range of issues, the Trump administration announced July 10 a new Section 301 investigation into a French digital services tax. This investigation, which could take up to 12 months, could result in tariffs or other restrictions on imports from France if the two sides are not able to reach a settlement. Other European Union member countries are also reportedly considering DSTs after efforts to impose one across the entire EU failed earlier this year.
Congressional action on legislation to implement the U.S.-Mexico-Canada Agreement appears increasingly likely to be delayed until this fall as the Trump administration continues efforts to resolve objections raised by lawmakers.
The Department of Commerce is accepting through July 29 comments that will be used to develop a report on dealing with imports of counterfeit and pirated goods.
More than 100 additional goods have been excluded from the additional 25 percent duty imposed on some $34 billion worth of imports from China (List 1 goods). These exclusions cover 110 specially prepared product descriptions that reflect 362 separate exclusion requests. The exclusions will be retroactive to July 6, 2018, and remain in place until July 9, 2020. They must be claimed using new HTSUS subheading 9903.88.11.