The Export-Import Bank of the U.S. has extended through May 28 the deadline for information on the level of U.S. and foreign content in U.S. exports in the following transformational export sectors: artificial intelligence; biotechnology; biomedical sciences; wireless communications equipment (5G); quantum computing; renewable energy, energy efficiency, and energy storage; semiconductors and semiconductor machinery manufacturing; emerging financial technologies; water treatment and sanitation; and high-performance computing.
Under new content principles for these sectors approved in December 2020, EXIM support is available for eligible transformational export transactions having a U.S content level of 51 percent or more, down from the previous level of 85 percent for medium- and long-term transactions. As a result, such transactions may now receive EXIM support if they contain up to 49 percent eligible foreign content, up from 15 percent previously.
The new principles also allow EXIM to consider full support for transactions with less than 51 percent U.S. content if certain prerequisites are met, including the exporter providing an acceptable actionable written plan to increase U.S.-based jobs in the next 3-5 years and at least one of seven factors being applicable to the transaction. However, Chinese content is presumptively ineligible for transactions financed under the transformational exports content policy.
EXIM states that a narrow implementation of these principles would limit its support of foreign content to what is currently called “eligible foreign content,” or foreign content included in a U.S. export contract and shipped from the U.S. A more expansive implementation would allow EXIM to support goods in a U.S. exporter’s contract (including those supplied by foreign subsidiaries and sub-suppliers) that ship directly from a third country to a foreign buyer.
To help ensure that the expansion of the types of foreign content supported results in more U.S. jobs, EXIM is seeking input on the following issues.
- average annual value of U.S. exports in each of the ten transformational areas that could potentially need EXIM support over the next five years
- average/typical percent of U.S. content in the supply chain of each of the ten areas and (if less than 85 percent U.S. content) why
- average/typical percent of foreign content in each area for which it is infeasible to bring it through the U.S. prior to shipping to the final buyer and (if more than zero foreign content) why
- average/typical percent of foreign content for each area that is from China and (if more than zero Chinese content) the relative ease/difficulty of sourcing that content from a non-Chinese entity
- the availability, typical timing, and cost implications of requiring U.S. shipping for foreign port of origin shipments from a third country to the buyer/borrower via ocean transport
- typical timing and cost implications of prohibiting Chinese shipping for any foreign port of origin shipments from a third country to the buyer/borrower
Copyright © 2023 Sandler, Travis & Rosenberg, P.A.; WorldTrade Interactive, Inc. All rights reserved.