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Practice Areas

No Section 301 Tariff Exclusions on List 3 Goods Until March, USTR Says

Thursday, January 17, 2019
Sandler, Travis & Rosenberg Trade Report

Visit our Tariff Action Resource Page for the current status of Section 301 List 3 goods.

The Trump administration will not initiate a process for excluding goods from the Section 301 additional tariff on $200 billion worth of imports from China until at least March, according to U.S. Trade Representative Robert Lighthizer. In addition, Lighthizer said, those goods cannot be exempted from the tariff by being entered into a foreign-trade zone.

The so-called List 3 goods were hit with an additional 10 percent tariff as of Sept. 24, 2018, as part of the administration’s response to a determination that China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation are unreasonable and discriminatory. (Click here for a list of affected goods and details on all actions taken in this Section 301 case.) 

USTR has accepted requests for exclusions from the Section 301 additional 25 percent tariff on $50 billion worth of goods from China (which was imposed July 6, 2018, on so-called List 1 items and Aug. 23, 2018, on List 2 items) and, according to Lighthizer, has granted nearly 1,000 exclusions for List 1 goods. Despite requests from industry and hundreds of lawmakers, however, USTR has not provided for exclusions for List 3 goods.

In letters to lawmakers this week, Lighthizer said USTR will only initiate an exclusion process for these goods if ongoing negotiations with China fail and the additional tariff increases from 10 percent to 25 percent on March 2.

Regarding Chinese goods admitted into FTZs and subsequently entered into U.S. commerce, Lighthizer said “longstanding rules and practices governing such entries continue to apply.” As a result, he said, “as of this time we have not found a basis for exempting U.S. importers who use FTZs from the additional duties, when those duties apply to all other U.S. importers.”

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