Section 301 Update: USTR Seeks Public Comment on the Efficacy of Section 301 Tariffs

3 min

In 2017, the Office of the United States Trade Representative (USTR) launched an investigation into the Government of China's acts, policies, and practices related to "technology transfer, intellectual property, and innovation," pursuant to its authority under Section 301 of the Trade Act of 1974, as amended. Following this investigation, the USTR imposed four rounds of tariffs on China-origin goods because of its determination that the Government of China employed unreasonable or discriminatory practices that burdened or restricted U.S. commerce (hereinafter referred to as "the Section 301 Tariffs").

On May 3, 2022, the USTR notified the public that the Section 301 Tariffs were "subject to possible termination on their respective four-year anniversary dates" and that domestic industries would have the opportunity to request continuation of the actions during the last sixty days of these four-year periods. Last month, USTR further notified the public that the tariffs would remain in effect because at least one representative of a domestic industry requested continuation of these actions.

Because the USTR received an appropriate request to continue the actions taken pursuant to Section 301, it must review (1) the efficacy of these actions (e.g., whether the actions align with the goals of Section 301and whether alternative actions are available) and (2) the impact of these actions on the domestic economy, including consumers. See 19 U.S.C. 2417(c)(3)(A) and (B). Therefore, the USTR will open a docket on November 15, 2022 for the public to submit comments on topics including, but not limited to, the following:

  • The effectiveness of the actions in eliminating the unreasonable and discriminatory actions, policies, and practices of the Government of China
  • The effectiveness of the actions in counteracting the Government of China's actions policies, and practices
  • Alternative actions or modifications to existing actions to more effectively address these issues posed by the Government of China
  • The impact of the Section 301 Tariffs and related actions on:
    • The U.S. economy, including consumers
    • U.S. domestic manufacturing (e.g., capital investments, domestic capacity, profits)
    • U.S. technology (e.g., U.S. technological leadership and development)
    • U.S. workers (e.g., employment and wages)
    • Small U.S. businesses
    • U.S. supply-chain resilience
    • The goals of U.S. critical supply chains, as described in Executive Order 14017 (Feb. 24, 2021)
  • Whether the actions resulted in higher additional duties on inputs used for additional manufacturing in the United States rather than on downstream products or finished goods incorporating those inputs

Prior to the opening of this new comment web portal on November 15, 2022, the USTR will post a copy of these questions at https://comments.USTR.gov. The USTR may also provide additional opportunities for public comment, which will be addressed in its subsequent notices.

If your business has been impacted by the Section 301 tariffs and you want to participate in these Section 301 industry engagement opportunities or have any questions, please reach out to Venable's International Trade Group for guidance.