Background

Requests for exclusions from the additional tariff imposed as of Sept. 24, 2018, on some $200 billion worth of imports from China may be submitted between June 30 and Sept. 30. Any exclusions granted will be retroactive to Sept. 24, 2018, and will remain in effect for one year from the date of publication of the exclusion determination in the Federal Register

The additional tariff on the so-called List 3 items was initially set at 10 percent and subsequently raised to 25 percent with respect to subject merchandise exported before May 10 and entered into the U.S. before June 15. This tariff was levied in response to a Section 301 investigation determination that China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation are unreasonable and discriminatory. 

(Click here for ST&R’s web page providing information on the U.S. tariffs imposed under Section 232 and Section 301 as well as the retaliatory tariffs trading partners are levying on U.S. goods.) 

Any interested person, including trade associations, may request exclusions from the Section 301 tariff on List 3 items. Each request must include the following information. 

  • contact information, including full legal name of the organization making the request, whether the requester is a third party (law firm, trade association, or customs broker) submitting on behalf of an organization or industry, and primary point of contact (information on whether the requester’s business satisfies the Small Business Administration’s size standard for a small business may also be provided)
  • applicable ten-digit HTSUS number (different models classified under different eight-digit or ten-digit subheadings are considered different products and require separate exclusion requests)
  • product name and detailed description of the product, including its physical characteristics such as dimensions, weight, material composition, etc. (requesters may submit a range of comparable goods within the product definition set out in an exclusion request)
  • product function, application, principal use, and any unique physical features that distinguish it from other products within the covered eight-digit subheading
  • requester’s relationship to the product (importer, U.S. producer, purchaser, industry association, other)
  • annual quantity and value of Chinese-origin product, domestic product, and third-country product purchased by the requester in 2017, 2018, and the first quarter of 2019
  • information on the requester’s gross revenues for 2018 and the first quarters of 2018 and 2019
  • for imports sold as final products, the percentage of the requester’s total gross sales in 2018 that sales of the Chinese-origin product accounted for
  • for imports used in the production of final products, the percentage of the total cost of producing the final product(s) the Chinese-origin input accounts for and the percentage of the requester’s total gross sales in 2018 that sales of the final product(s) accounted for 

In addition, each request should address the following factors.

  • whether the product is available only from China and whether the product and/or a comparable product is available from sources in the U.S. and/or third countries
  • whether the requester has attempted to source the product from the U.S. or third countries
  • whether the imposition of additional duties (since September 2018) on the product has or will cause severe economic harm to the requester or other U.S. interests
  • whether the product is strategically important or related to “Made in China 2025” or other Chinese industrial programs 

Requesters may also provide information about the possible cumulative effects of the Section 301 tariff actions, particularly information about any previously submitted exclusion requests as well as the value of the requester’s imports covered by the previous tariff actions. Additionally, requesters may provide any other information or data that they consider relevant to the evaluation of an exclusion request. 

Sandler Travis & Rosenberg, P.A. has substantial experience helping companies get specific tariff numbers and products removed from Section 301 tariffs. For more information on the format and approach needed to submit these exclusion requests, please contact your ST&R professional or Sandler, Travis & Rosenberg, P.A.

Copyright © 2023 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.

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