Spencer Toubia

Subscribe to Spencer Toubia's Posts

On August 16, 2018, the Office of the U.S. Trade Representative (USTR) published in the Federal Register the formal notice for the China Section 301 tariffs beginning on August 23.

The USTR published the final list of 279 Harmonized Tariff Schedule of the United States (HTSUS) subheadings known collectively as ‘List 2’ on August 7, 2018. These tariff lines will see an additional ad valorem duty of 25% on products from China and is worth $16 billion.

Unlike the notice implementing List 1 from June 20, 2018, the USTR:

  • Added to Annex A of this notice clarifications on the application of the additional duties to goods entered under certain provisions of Chapter 98 and 99 of the HTSUS;
  • In Annex C to this notice, modifies the HTSUS note in Annex A to the June 20 notice in order to reflect these clarifications; and
  • Annex C makes a conforming amendment to the HTSUS heading in Annex A to the June 20 notice, and makes a technical correction to the HTSUS note in Annex A to the June 20 notice.

The tariff subheadings in Annex A and B are the same. The latter list includes unofficial descriptions of the types of products covered in each subheading.

Regarding product exclusions, the notice states, “…the Trade Representative has determined that USTR will establish a process by which U.S. stakeholders may request that particular products classified within an HTSUS subheading listed in Annex A be excluded from these additional duties. The process will be comparable to the exclusion process established in connection with the initial, $34 billion trade action. USTR will publish a separate notice describing the product exclusion process, including the procedures for submitting exclusion requests, and an opportunity for interested persons to submit oppositions to a request.”

Check here for the latest developments on all the on-going trade actions.

 

On August 10, 2018, President Trump issued a new Proclamation Adjusting Imports of Steel into the United States from Turkey. Steel articles covered by Section 232 from Turkey are now subject to an ad valorem duty rate of 50%.

On August 12, 2018, U.S. Customs and Border Patrol (CBP) issued Cargo Systems Messaging Service (CSMS) #18-000477, which stated:

  • The increased duty rates began at 12:01 a.m. EDT on August 13, 2018.
  • In addition to reporting the regular Chapters 72 & 73 of the Harmonized Tariff Schedule of the United States (HTSUS) classification for the imported merchandise, importers shall report the following HTSUS classification for imported merchandise subject to the additional duty:
    • 9903.80.02 (50% ad valorem duty rate for products of iron and steel that are the product of Turkey).

On August 7, 2018, the United States Trade Representative (USTR) released a final list of approximately $16 billion worth of imports from China that will be subject to a 25 percent additional tariff. The list contains 279 of the original 284 tariff lines that were on a proposed list announced on June 15.

Update: the five tariff items that were excluded from the final List 2 are:

3913.10.00 Alginic acid, and its salts and esters, in primary forms
8465.96.00 Splitting, slicing or paring machines for working wood, cork, bone, hard rubber, hard
plastics or similar hard materials
8609.00.00 Containers (including containers for transport of fluids) specially designed and
equipped for carriage by one or more modes of transport
8905.90.10 Floating docks
9027.90.20 Microtomes

Changes to the proposed list were made after USTR and the interagency Section 301 Committee sought and received written comments and testimony during a two-day public hearing last month. Customs and Border Protection will begin to collect the additional duties on the Chinese imports on August 23.

A formal notice of the $16 billion tariff action will be published in the Federal Register. Please contact us if you have any questions or need assistance.

 

President Trump has directed the Office of the United States Trade Representative (USTR) to consider increasing the proposed tariffs under Section 301 from 10% to 25% for the entire $200 billion list (also known as “List 3”). Because of this, the USTR has extended several of the dates in the public comment process.

The USTR circulated an e-mail on August 2 to parties that had submitted a request to appear in the upcoming Section 301 hearing for the “List 3” products. In it, the USTR clarified information provided in a press release on August 1.

To summarize:

  • The due date for filing requests to appear and a summary of expected testimony at the public hearing and for filing pre-hearing submissions is extended from July 27 to August 13, 2018.
  • The due date for submission of written comments is extended from August 17 to September 5, 2018.
  • The due date for submission of post-hearing rebuttal comments is also extended from August 30 to September 5, 2018.
  • The scheduled start date of the Section 301 hearing (August 20) has not changed.
    • The Section 301 Committee may extend the length of the hearing depending on the number of additional interested persons who request to appear. As of now, the hearing is scheduled to take place from August 20 to August 23.
    • The USTR will provide the full hearing schedule the day before the hearing, per USTR policy.

 

 

 

 

On July 10, 2018, U.S. Trade Representative (USTR) Robert Lighthizer announced that at President Trump’s request, USTR has initiated the process of imposing an additional 10 percent ad valorem duty on approximately $200 billion worth of imports from China.

The USTR statement included a link to an advance copy of the Federal Register Notice with the list of proposed tariffs and the process for the public notice and comment period.

This is the formal publication in the Federal Register of this notice.

For more information on the proposed tariffs and the process for the public notice and comment period, please see our previous article.

 

 

On Monday, July 16, 2018, the Commerce Department will post a notice in the Federal Register cancelling one of the days of the two-day public hearing associated with the investigation the Department is conducting to determine whether imports of automobiles, including cars, SUVs, vans and light trucks, and automotive parts threaten to impair the national security and to recommend remedies if such a threat is found to exist.

The hearing was originally scheduled for July 19 and 20. The Department received 45 requests to testify, which can all be accommodated on a single day. Therefore, the second day of the hearing originally scheduled for July 20 is cancelled.

The hearing will be held on July 19 only and will begin at 8:30 am and will end at 5:30 pm. The location of the hearing remains unchanged.

 

 

 

 

On July 11, 2018, the United States Trade Representative (USTR) opened the docket for China 301 Product Exclusion Requests on regulations.gov. The Docket ID is USTR-2018-0025.

The docket includes USTR’s ‘China 301 Product Exclusion Form’.

In its July 11 Federal Register Notice describing the procedures to use for product exclusion requests, USTR states, “To assist in review of requests for exclusion, USTR has prepared a request form that will be posted on the USTR website under ‘‘Enforcement/Section 301 investigations’’ and on the www.regulations.gov docket in the ‘‘supporting documents’’ section. USTR strongly encourages interested persons to use the form to submit requests.”

The Section 301 exclusion form is more simplified than the earlier Section 232 exclusion form. Interested parties can still submit supporting documents in addition to the form, and there is no page limit to the submission

As a reminder, this product exclusion request process only applies to those goods subject to the ad valorem duty of 25 percent on products from China classified in the 818 subheadings of the Harmonized Tariff Schedule of the United States (HTSUS) set out in Annex A of the June 20, 2018, Federal Register Notice. Note that Annex B to the notice contains the same list of tariff subheadings, with unofficial descriptions of the types of products covered in each subheading.

For more information on key dates and submission guidelines for China Section 301 Product Exclusion Requests, please click here for Crowell’s post discussing the specifics of the notice.

 

 

 

On July 10, 2018, U.S. Trade Representative (USTR) Robert Lighthizer announced that at President Trump’s request, USTR has initiated the process of imposing an additional 10 percent ad valorem duty on approximately $200 billion worth of imports from China including apparel, textiles, chemicals, and agricultural & aquacultural goods.

The USTR statement includes a link to an advance copy of the Federal Register Notice with the list of proposed tariffs and the process for the public notice and comment period. The notice will be published in the Federal Register later this week.

This is the third round of additional tariffs proposed by the Trump administration as a result of its Section 301 investigation into China’s alleged unfair trade practices related to “the forced transfer of American technology and intellectual property.”

The notice indicated the USTR will maintain the first round of tariffs on $34 billion worth of goods implemented on July 6, and will continue with a second round of proposed tariffs on $16 billion worth of goods. This second list is currently under review in a public notice and comment process, with a public hearing scheduled for July 24, 2018.

The Harmonized Tariff Schedule of the United States (HTSUS) subheadings of the products subject to the proposed tariffs is listed in the Annex (pages 11-205) to the notice.

The notice also included a list of key dates for a public notice, comment, and hearing process:

  • July 27, 2018: Due date for filing requests to appear and a summary of expected testimony at the public hearing, and for filing pre-hearing submissions.
  • August 17, 2018: Due date for submission of written comments.
  • August 20-23, 2018: The Section 301 Committee will convene a public hearing in the main hearing room of the U.S. International Trade Commission, 500 E Street SW, Washington, DC 20436 beginning at 9:30 am.
  • August 30, 2018: Due date for submission of post-hearing rebuttal comments.

 

 

Section 301 For covered products in List 1, please click here. 25% 7/6/2018
For covered products in List 2, please click here. TBD TBD
For covered products in List 3, please click here and see Annex 10% TBD
Status: List 1 totaling $34 billion worth of imports is composed of 818 tariff lines, and went into effect on 7/6/2018.

 

List 2 totaling $16 billion worth of imports is composed of 284 proposed tariff lines identified by the interagency Section 301 Committee. These are in a public review process.

 

List 3 includes a list of tariff lines of products from China with an annual trade value totaling approximately $200 billion. These are also subject to a public review process.

On July 11, 2018, the United States Trade Representative (USTR) published a notice in the Federal Register explaining the procedures and criteria related to requests for product exclusions from the additional tariffs placed on goods from China on July 6.

USTR must receive requests to exclude a particular product by October 9, 2018. Per the notice, a docket will be opened on regulations.gov for the receipt of exclusion requests in docket number USTR–2018–0025.

Responses to a request for exclusion of a particular product are due 14 days after the request is posted.

Any replies to responses to an exclusion request are due 7 days after the close of the 14 day response period.

On July 6, 2018, USTR issued an intial press release with a link to an advance copy of this Federal Register Notice.

For more details regarding this important announcement, please click here for Crowell’s July 8 post discussing the specifics of the notice.

 

 

 

 

 

 

In a notice published on June 20, 2018, the U.S. Trade Representative (USTR) announced the imposition of an additional ad valorem duty of 25 percent on products from China classified in the 818 subheadings of the Harmonized Tariff Schedule of the United States (HTSUS) set out in Annex A of the notice in response to China’s alleged acts, policies, and practices related to technology transfer, intellectual property, and innovation included. Note that Annex B to the notice contains the same list of tariff subheadings, with unofficial descriptions of the types of products covered in each subheading.

The additional duties on these products took effect on July 6, 2018.

The June 20 notice also announced that the USTR would establish a process by which U.S. stakeholders may request that particular products classified within a covered tariff subheading be excluded from the additional duties.

On July 6, 2018, USTR issued a press release with a link to the soon-to-be published Federal Register Notice which explains the procedures and criteria related to requests for product exclusions. A docket for the receipt of exclusion requests will be established on regulations.gov.

The notice will be published in the Federal Register sometime during the week of July 9, 2018.

A key piece of information for importers is that “[a]ny exclusion will be effective starting from the July 6, 2018 effective date of the additional duties, and extending for one year after the publication of the exclusion determination in the Federal Register. In other words, an exclusion, if granted, will apply retroactively to the July 6 date of the imposition of the additional duties. USTR will periodically announce decisions on pending requests.”

Key Dates

  • Interested parties will have 90 days to file a request for a product exclusion; and
  • The request period will end on October 9, 2018.

Rationale for Requested Product Exclusion

Each request should explain the following factors:

  • Whether the particular product is available only from China. In addressing this factor, requesters should address specifically whether the particular product and/or a comparable product is available from sources in the United States and/or in third countries;
  • Whether the imposition of additional duties on the particular product would cause severe economic harm to the requester or other U.S. interests; and
  • Whether the particular product is strategically important or related to “Made in China 2025” or other Chinese industrial programs.

Process Timeline

  • Following public posting of a request on Regulations.gov, the public will have 14 days to comment on a certain product exclusion request; and
  • After the close of the 14 day response period, interested persons will have an additional 7 days to reply to any responses received in support of or opposition to the request.

Highlights

The notice includes information on:

  • How to identify products in the exclusion request;
  • Submission Instructions – to include the submission of business confidential information; and
  • Document Format Instructions.

 

 

Check back here for the latest developments on all the on-going trade actions.