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More China Tariff Exclusion Requests Denied Than Approved to Date

Wednesday, January 30, 2019
Sandler, Travis & Rosenberg Trade Report

The Trump administration has received nearly 13,000 requests for exclusions from the additional tariffs it has imposed on imports from China, according to information made available by the Office of the U.S. Trade Representative. Some have been granted and more have been denied but most are still at various stages of review.

Following a Section 301 determination that China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation are unreasonable and discriminatory, the Trump administration has levied higher tariffs on Chinese goods in stages. The first phase imposed a 25 percent additional tariff on $34 billion worth of imports as of July 6, and exclusion requests were due by Oct. 9. The administration extended that tariff to another $16 billion worth of goods as of Aug. 23 and accepted exclusion requests through Dec. 18.

A ten percent additional tariff was imposed on so-called List 3 goods (valued at about $200 billion) as of Sept. 24 and is scheduled to increase to 25 percent on March 2. Administration officials have said they will not provide any exclusion request process for these goods unless that increase occurs. The White House has also warned of an as-yet-unspecified tariff hike on an additional $267 billion worth of Chinese goods if Beijing “takes retaliatory action against our farmers or other industries.”

(Click here for more detailed information on affected products and other aspects of the Section 301 process.)

Spreadsheets recently made available by USTR indicate that nearly 11,000 exclusion requests were submitted for List 1 goods. USTR has denied 1,730 of these requests and granted 984 (click here for more details). The remainder are listed as being at one of four stages: Only 31 are still open for public comment, 6,350 are undergoing an initial review of whether the request should be granted based on specified criteria, and 1,728 are being reviewed with U.S. Customs and Border Protection to determine whether the requested exclusion would be administrable. None are currently listed as being in stage 4, in which the exclusion has been granted and is being prepared for publication in the Federal Register.

USTR has also received 2,799 exclusion requests for List 2 goods. Of these, 1,157 are still open for public comment and 1,640 are undergoing substantive review.

For more information on Section 301 tariffs, including exclusion requests, please contact Nicole Bivens Collinson at (202) 730-4956 or Kristen Smith at (202) 730-4965.

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