Section 301 Exclusion Requests Granted by the USTR as of November 11, 2019
USTR Announces List 4A Exclusion Process
On October 18th, the USTR confirmed that List 4A Exclusion Requests can be submitted starting October 31, 2019, at noon EDT. The deadline to submit requests is January 31, 2020. The USTR has not released a process for requesting exclusions for List 4B. Interested parties have an opportunity to submit an individualized case to the government in an attempt to have their products excluded from additional tariffs. In short, the USTR will be looking for whether the products can be sourced outside of China, whether the imposition of additional duties will cause severe economic harm, and whether the product is strategically related to the “Made in China 2025” initiative. Any exclusion will be effective starting from September 1, 2019, and will extend one year after the publication of the exclusion determination in the Federal Register.
Third Round of Products Excluded from List 3 Section 301 Duties
On October 23, 2019, the USTR issued the third round of product exclusions for the 3rd tranche of Section 301 duties. These exclusions are retroactive to September 24, 2018, and will apply until August 7, 2020.
As set out in the Annex, the exclusions are reflected in 83 specially prepared product descriptions, which cover 95 separate exclusion requests. In accordance with the June 24 notice, the exclusions are available for any products that meet the description in the Annex, regardless of whether the importer filed an exclusion request. Additionally, the scope of each exclusion is governed by the scope of the product descriptions in the Annex, and not by the product descriptions set out in any particular request for exclusion.
U.S. Customs and Border Protection will issue instructions on entry guidance and implementation at a later date.
China and the U.S. reach Preliminary “Phase One” Deal
On November 11, 2019, President Trump and Chinese negotiators reached a preliminary agreement that will ease trade tensions marking the first tangible achievement in their 18-month trade war.
This agreement provides relief mainly to American business and farmers that have been effected by the trade war. The accord would result in an additional $40 billion to $50 billion in farm purchases by China that could officially be signed by November.
In exchange, the U.S. will not move ahead with plans to raise tariffs on $250 billion worth of Chinese goods to 30 percent. President Trump has not made a final decision on whether to impose an additional round of tariffs on Dec. 15.
Stay tuned for more information …
President Trump Announces List 4 Tariffs Beginning on September 1
As a result of Beijing’s trade retaliation, President Trump has said he will be further increasing tariffs on Chinese imports. Trump tweeted, “China should not have put new Tariffs on 75 BILLION DOLLARS of United States product (politically motivated!).” The List 1 and List 2 duties will increase from 25% to 30% beginning on October 1, while the List 3 duties will be 15% rather than 10% on September 1. The US and China were supposed to meet in Washington next month – the status of this meeting is unclear after the latest retaliations.
Seventh Round of Products Excluded from Section 301 Duties
On August 2, CBP issued the first round of product exclusions for the 2nd tranche of Section 301 duties. These exclusions are retroactive for imports on or after August 23, 2018.
Below are instructions provided by CBP (84 FR 37381) for submitting entries containing products granted exclusions:
- In addition to reporting the regular Chapters 39, 84, 85, 86, 87 and 90 classifications of the HTSUS for the imported merchandise, importers shall report the HTSUS classification 9903.88.12 (Articles the product of China, as provided for in U.S. note 20(o) to this subchapter, each covered by an exclusion granted by the U.S. Trade Representative) for imported merchandise subject to the exclusion;
- Importers shall not submit the corresponding Chapter 99 HTS number for the Section 301 duties when HTS 9903.88.12 is submitted.
Similar to List 1, if an importer has a product that falls on a Product Exclusion list, they can file a Post Summary Correction (PSC) if within the PSC filing timeframe. If the entry is beyond the PSC filing timeframe, importers may file a protest.
Imports which have been granted a product exclusion that are not subject to the Section 301 duties, are not covered by Foreign Trade Zone (FTZ) provisions of the Section 301 Federal Register notices. Rather, they are subject to the FTZ provisions in 19 C.F.R. Part 146.
USTR Issues Product Exclusions From Third Tranche of Section 301 Tariffs
On August 5, the USTR has released its first Product Exclusions for Section – List 3. The new exclusions from the tariffs include “10 specially prepared product descriptions” and cover 15 separate requests, according to the notice. The product exclusions apply retroactively to Sept. 24, 2018 (the initial 10% tariff), and are valid for one year after the notice is published in the Federal Register.
For more information:
Foreign Tariff Responses to U.S. Section 232 Steel and Aluminum Tariffs
A number of countries and U.S. trading partners have imposed or announced their intent to impose retaliatory tariffs on specific exports from the United States in response to the United States’ Section 232 tariffs on steel and aluminum imports into the United States.
To assist U.S. companies in identifying those exports impacted by retaliatory tariffs, the Department of Commerce’s Industry & Analysis unit has compiled a Retaliation Product Coverage Matrix and retaliation information.
Retaliation Product Coverage Matrix
This matrix lists the U.S. goods subject to announced foreign retaliatory measures and includes direct links for U.S. businesses to find additional detail regarding the scope of the foreign measures.
On July 1, 2018, Canada began imposing additional tariffs of 10 or 25 percentage points on selected U.S. products.
The United States believes that Canada’s retaliatory tariffs are inconsistent with World Trade Organization (WTO) rules and has opposed them at the WTO.
See Official Notification from Canada: https://www.fin.gc.ca/access/tt-it/cacsap-cmpcaa-1-eng.asp
On April 2, 2018, China began imposing additional tariffs of 15 or 25 percentage points on selected U.S. products.
The United States believes that China’s retaliatory tariffs are inconsistent with WTO rules and has opposed them at the WTO.
See Official Announcement from China (in Mandarin): http://gss.mof.gov.cn/zhengwuxinxi/zhengcefabu/201804/t20180401_2857769.html
China’s notification to the WTO, which includes a list of tariff codes covered by its retaliatory measures in English, is available here.
On June 22, 2018, the European Union (EU) began imposing additional tariffs of 25 percentage points on selected U.S. products.
The EU has also announced that it reserves the right to impose additional retaliatory tariffs in three years, beginning in 2021, or earlier if the EU receives a favorable ruling by the WTO Dispute Settlement Body on their claim that the U.S. tariffs constitute a violation of WTO rules.
The United States believes the EU tariffs are inconsistent with WTO rules and has opposed them at the WTO.
See Official Announcement from the European Union: https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32018R0724&from=
EU’s notification to the WTO, which includes a list of tariff codes covered by its retaliatory measures, is available here.
India has announced that, effective August 4, 2018, it will impose retaliatory tariffs of an additional 10, 15, 20, 25, or 50 percentage points on selected U.S. products.
India’s notification to the WTO, which includes a list of tariff codes to be covered by its retaliatory measures, is available here.
Japan has notified the WTO of its intent to impose retaliatory tariffs on U.S. products. To date, however, it has not provided specific information regarding the scope or timing of its retaliatory measures.
On June 5, 2018, Mexico began imposing additional tariffs ranging from 7 to 25 percentage points on selected U.S. products.
The United States believes that Mexico’s retaliatory tariffs are inconsistent with WTO rules and has opposed them at the WTO.
See Mexico’s Official Notification (in Spanish): http://www.dof.gob.mx/nota_detalle.php?codigo=5525036&fecha=05/06/2018
On July 6, 2018, Russia announced that they will impose additional tariffs of additional 25, 30, 35, or 40 percentage points on selected U.S. products. The additional tariffs are scheduled to take effect 30 days from the July 6th announcement.
See Russia’s Official Notification (in Russian): http://government.ru/docs/33173/
Russia’s notification to the WTO is available here.
On June 21, 2018, Turkey began imposing additional tariffs on selected U.S. products. On August 15, 2018, Turkey announced an increase in the additional tariff rates, ranging from 4 to 140 percent.
The United States believes that Turkey’s retaliatory tariffs are inconsistent with WTO rules and has opposed them at the WTO.
See Turkey’s Official Notifications (in Turkish): http://www.resmigazete.gov.tr/eskiler/2018/06/20180625M1-30.pdf http://www.resmigazete.gov.tr/main.aspx?home=http://www.resmigazete.gov.tr/eskiler/2018/08/20180815.htm&main=http://www.resmigazete.gov.tr/eskiler/2018/08/20180815.htm
Turkey’s notification to the WTO, which includes a list of tariff codes covered by its retaliatory measures in English, is available here.
To the extent retaliatory measures impact agriculture exports, please consult the U.S. Department of Agriculture’s Global Agriculture Information Network (GAIN) reports at https://gain.fas.usda.gov/Lists/Advanced%20Search/AllItems.aspx.
Norway and Switzerland have also requested consultations with the United States, as part of WTO dispute settlement proceedings, on the U.S. Section 232 tariffs on imports of steel and aluminum into the United States. To date, these countries have not announced their intent to impose retaliatory tariffs.
The information set forth above regarding foreign retaliatory measures, including the Retaliation Product Coverage Matrix, has been provided as a public service for general reference. Every effort has been made to ensure that the information presented is complete and accurate as of September 18, 2018. The information will be updated as new developments occur.
The actual tariff classification and assessment of duties is determined by customs authorities in the relevant foreign country. Moreover, countries may elect to increase tariffs or otherwise amend tariff treatment at any time. For definitive guidance, parties should contact the government customs agency in the appropriate foreign country.