Subscription Center  

International Trade Alert

Last month, the United States Trade Representative (USTR) announced the application of an additional 25% duty on certain Chinese imports under Section 301 of the Trade Act of 1974 ("Section 301 Tariffs"). Specifically, the USTR published a list of 818 subheadings of the Harmonized Tariff Schedule of the United States (HTSUS) that, as of July 6th, are subject to the Section 301 Tariffs. A second list of 284 additional subheadings that may also be subject to the Section 301 Tariffs was proposed by USTR in late June and is currently in the public comment phase, which ends on July 23rd. Most recently—just last night—USTR released a third list encompassing almost 200 pages worth of HTSUS subheadings that would be subject to an additional 10% duty. USTR is seeking public comment and will hold a hearing regarding this third round of Section 301 Tariffs. Requests to testify are due by July 27th and written comments must be submitted by August 17th. A quick reference chart regarding the tariffs and relevant dates is provided below. 

 


Section 301 Quick Reference Chart

 

Covered Products

Additional Tariff Rate

Status

Relevant Dates

First Round

818 HTSUS subheadings

25%

Final

  • Effective July 6, 2018

Second Round

284 HTSUS subheadings

25%

Proposed

  • Comments due July 23, 2018
  • Hearing on July 24, 2018
  • Rebuttal comments due July 31, 2018

Third Round

Approximately 5000 HTSUS subheadings

10%

Proposed

  • Requests to appear due July 27, 2018
  • Comments due August 17, 2018
  • Hearing on August 20-23, 2018
  • Rebuttal comments due August 30, 2018

In response to concerns expressed by importers that the Section 301 Tariffs will harm U.S. businesses, especially in circumstances where a particular product is only made in China, USTR published, late last week, procedures and guidance detailing how companies can request exclusions from the newly effective Section 301 Tariffs.

Notably, USTR will consider exclusion requests from any interested person, including trade associations, which may submit requests on behalf of their members. An exclusion request can contain any information or data the requester considers relevant, but it must, at a minimum, address each of the following factors:

  • Whether the specific product is only available from China;
  • Whether the additional duties on the specific product cause severe economic harm to the requester or to other US interests; and
  • Whether the specific product is strategically important or related to the "Made in China 2025" program.

Requests for exclusions must be made on a product-by-product basis (i.e. one request per product), and all requests must be submitted to USTR by October 9, 2018. Each request must (1) specifically identify a particular product, including how the product is distinguishable from other products in the relevant 8-digit HTSUS subheading; (2) include supporting data regarding quantity and value of imports for the past three years; and (3) provide the rationale for the requested exclusion (i.e. address the exclusion factors noted above).

The USTR procedures also detail the process and deadlines for other interested parties to respond to requests for exclusions and for the requesters to reply to any such responses.

Any approved exclusion request will be retroactively effective to July 6, 2018, and will remain effective for one year after the date that USTR publishes the exclusion in the Federal Register.

Please contact Venable's International Trade and Logistics Group if you have questions about the Section 301 Tariffs, or if your business or association would like to submit comments for the proposed tariffs or request an exclusion for affected Chinese imports.