News
Print PDF

Practice Areas

Additional Tariffs on Chinese Goods Effective July 6; Exclusions May be Requested

Friday, June 15, 2018

The Trump administration announced June 15 a list of 818 products from China that will be subject to an additional 25 percent duty as of July 6.  The administration also released a list of 284 other tariff lines – not included in any previous proposal – on which additional duties could be imposed following a public notice and comment process. These tariffs are being imposed after a Section 301 investigation determined that China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation are unreasonable and discriminatory.

Companies should immediately examine these lists and conduct classification reviews of their products to determine if they are or might be affected by the new tariffs. In addition, companies should consider utilizing a process to be announced in the next few weeks to request exclusions of specific products from the tariffs.

According to the Office of the U.S. Trade Representative, the two lists focus on products from industrial sectors that contribute to or benefit from the “Made in China 2025” industrial policy, which include aerospace, information and communications technology, robotics, industrial machinery, new materials, and automobiles. USTR states that the lists do not include goods commonly purchased by U.S. consumers such as cellular telephones or televisions.

The first list comprises 818 products with a total import value of $34 billion, down from the 1,300 goods valued at $50 billion that had originally been proposed. A large percentage of the goods on this list are from HTSUS Chapters 84, 85, 87, 88, and 90, such as engines and motors; construction, drilling, and agricultural machinery; machines for working minerals, glass, rubber, or plastic; rail locomotives and rolling stock; motor vehicles and motorcycles; helicopters and airplanes; and testing, measuring, and diagnostic instruments and devices.

The second list comprises 284 tariff lines with a total import value of about $16 billion. Many of these products are also classified in Chapters 84, 85, 97, and 90, but various products in chapters 27, 34, 38, 39, 70, 73, 76, and 89 are also included. Affected goods include plastics and plastic products; industrial machinery; machinery for working stone, ceramics, concrete, wood, hard rubber or plastic, and glass; cargo containers; tractors; and optical fibers.

President Trump said the U.S. will pursue even more tariffs against China (possibly on the $100 billion worth of Chinese goods he previously directed USTR to consider) if it retaliates for the Section 301 tariffs with measures such as imposing new tariffs on U.S. goods, services, or agricultural products; raising non-tariff barriers; or taking punitive actions against U.S. exporters or U.S. companies operating in China. Beijing did say it would “quickly react” following the June 15 announcement, possibly by following through on an earlier pledge to impose a 25 percent tariff hike on 106 goods imported from the U.S., largely in politically sensitive industries such as agriculture and automobiles.

If you think you might be negatively impacted by these tariffs, please contact Nicole Bivens Collinson at (202) 730-4956 to review the lists and discuss options, alternatives, and actions that might be pursued to protect your interests.

Customs & International Headlines