First Set of Exclusions Set to Expire December 28, 2019
On October 28, 2019, the Office of the United States Trade Representative (USTR) announced plans to begin considering extensions of up to one year for certain previously-granted product exclusions from Section 301 tariffs on Chinese imports. From November 1 – November 30, USTR will accept comments for or against product exclusions that are set to expire December 28, 2019.
The relevant product exclusions were granted December 28, 2018 in USTR’s initial set of exclusions from Section 301 duties on Chinese imports that took effect July 6, 2018. The 25 percent tariff covered more than 800 tariff lines, representing approximately $34 billion in annual trade value. In its December 28 action, USTR granted exclusions for more than 1,000 specific products classified within a tariff-covered 8-digit HTSUS subheading.
USTR subsequently issued seven more rounds of product exclusions from its July 6, 2018 tariff action (all expiring one year from the date of publication in the Federal Register) and continues considering exclusion requests for subsequent tariff actions. While additional extension request opportunities are anticipated going forward, the current opportunity only covers exclusions granted on December 28, 2018.
As detailed in a draft Federal Register Notice, USTR will evaluate the possible extension of each exclusion on a case-by-case basis. USTR has indicated it will focus its evaluation on whether the product under consideration remains only available from China. USTR will also consider whether additional duties would result in severe economic harm to U.S. interests. Additionally, USTR has asked commenters to address:
- Whether the particular product and/or a comparable product is available from sources in the United States and/or in third countries.
- Any changes in the global supply chain since July 2018 with respect to the particular product, or any other relevant industry developments.
- The efforts, if any, the importers or U.S. purchasers have undertaken since July 2018 to source the product from the United States or third countries.
- USTR is also interested in whether the product or products are subject to an antidumping or countervailing duty order issued by the U.S. Department of Commerce.
USTR strongly encourages all commenters to submit this information via “Form A,” a sample of which is included in the Federal Register Notice. Form A should be submitted through the federal e-rulemaking portal at www.regulations.gov by the November 30 deadline.
Further, USTR is requiring commenters who are importers and / or purchasers of the products in question to submit additional “business confidential” information via a separate “Form B.” Among other things, Form B requests detailed financial information as well as specific details regarding entities’ attempts to source the product(s) in question from the United States or other third countries. Form B, a sample of which is also included in the Federal Register Notice, will not be published on the public portal.