Many Chinese leather tanneries have applied for and received tariff exemptions from China’s retaliatory tariff on U.S. goods, according to a March 17 emailed alert from the Leather and Hide Council of America. The council also said China is granting tariff exemptions for products beyond what was included in the original announcement that contained nearly 700 U.S. goods (see 2002180039). The U.S. Department of Agriculture Foreign Agricultural Service issued a March report on China’s step-by-step tariff exclusion guide, providing a translation of the guide to help “familiarize” the U.S. food and agricultural industry with the process. The report contains details on how Chinese companies apply for exclusions, how they document their record of transactions, and what information they must submit to the Chinese authorities. The exclusion process opened March 2.
The head of the Commerce Department Bureau of Industry and Security revoked a shipping company’s export privileges for 15 years for export violations but ordered a review of the assessed fine, saying it was too high, according to a March 11 order. The company and its chairman -- Singapore-based Nordic Maritime Pte. Ltd and Morten Innhaug, respectively -- were originally fined more than $30 million by an administrative law judge, who also revoked the company’s export privileges until the fine was paid, according to the order. But Cordell Hull, BIS’s acting undersecretary, said the fine was too high, ordering the judge to review its decision to impose the penalty.
Kenya reduced its penalty for importers who violate rules that require imported goods to undergo inspections of their origin countries, according to a March 16 report from the Hong Kong Trade Development Council. The change, made last month, reduced the penalty from 20% to 5% of the value of the goods, the report said. The penalty stems from a policy that outlaws importers importing goods without prior inspection in their countries of origin, HKTDC said. Importers are concerned that lower penalties will lead to an influx of imports without prior inspections, which will lead to a backlog of goods awaiting inspection and evaluation at ports, the HKTDC said.
The government of Canada issued the following trade-related notices as of March 16 (note that some may also be given separate headlines):
The auto industry publicly asked the Trump administration not to rush into certifying readiness for the U.S.-Mexico-Canada Agreement's entry into force, given the fact that “a global pandemic is significantly disrupting our supply chains, and the industry is throwing all available resources into managing production through this crisis for our employees and for the broader U.S. economy.”
Canada's House of Commons approved the U.S.-Mexico-Canada Agreement -- called CUSMA in Canada -- by unanimous consent March 13, before adjourning until April 20 due to the coronavirus pandemic. The Canadian Senate passed it less than an hour later. Royal Assent, the equivalent of a presidential signature in the U.S., followed shortly, and the Senate adjourned as well. Now, all three countries must continue to work on uniform regulations so that they can certify the treaty is ready to enter into force. Efforts to slow the spread of the coronavirus disease COVID-19 may slow that process, because the countries also have to evaluate the progress toward fulfilling commitments, such as setting up labor courts in Mexico and getting new rules of origin processes in place. Once that certification is issued, NAFTA will be replaced on the first day of the third month after the announcement.
The Commerce Department Bureau of Industry and Security added 24 entities to its Entity List and revised five existing entries, the agency said in a notice. The new entries include companies in China, Iran, Pakistan, Russia and the United Arab Emirates; and the revised entries are for entities in France, Iran, Lebanon, Singapore and the United Kingdom. The changes take effect March 16. All shipments now requiring a license as a result of this rule that were on dock for loading or aboard a carrier to a port as of that date may proceed to their destinations under the previous eligibility, BIS said.
A top Commerce Department official tempered fears that the U.S. wants to stifle industry competitiveness (see 2003100044 and 2002180060) as it considers further restricting exports to Huawei and China, saying that is not the administration's goal. “Why would you restrict a U.S. company if you're only going to be enabling their competitor?” said Rich Ashooh, Commerce’s assistant secretary for export administration. “That’s a very important principle to engage in.”
Ecuador recently renewed its tariff exemptions for imports of soybean meal and wheat from all origins, according to a U.S. Department of Agriculture Foreign Agricultural Service report released March 2. The exemptions took effect Jan. 1 and will last for five years, the agency said. The extension marks the first time Ecuador has announced a five-year renewal, the agency said, adding that previous extensions have covered only two- to three-year periods.
The last American to serve on the World Trade Organization's Appellate Body, Tom Graham, told the Georgetown Law International Trade Update conference that the body “is not coming back any time soon.” Graham, who largely agrees with the U.S. critique of Appellate Body overreach, added, “The new I have come to ... is that it's better this way.” Graham was the most prominent, but far from the only speaker at the March 5-6 conference to say that neither the Europeans nor the Americans are ready to have a meeting of the minds on how to reform the appellate function of the rules-based trading order.