SAN ANTONIO, Texas -- A lawsuit challenging the new CBP drawback regulations that limit drawback on goods subject to excise taxes (see 1812190011) is expected soon, Sandler Travis lawyer Michael Cerny said on a panel at the National Customs Brokers & Forwarders Association of America's annual conference on April 16. CBP is saying "the export of excise-tax-free goods is considered a drawback, therefore you can't get a second drawback of that through substitution," Cerny said. "This is going to be challenged," and he said he expects a lawsuit within "the next few weeks." The excise tax changes became effective on Feb. 19, 2019.
The Office of the U.S. Trade Representative issued a third list of product exclusions from Section 301 tariffs on goods from China. The exclusions are "reflected in 21 specially prepared product descriptions, which cover 348 separate exclusion requests," according to a pre-publication copy of a notice posted to the agency’s website April 15. The product exclusions apply retroactively to July 6, 2018, the date the first set of tariffs took effect, and will remain in effect until one year after USTR publishes the notice in the Federal Register.
A coalition of U.S. producers seeks the imposition of new antidumping and countervailing duties on ceramic tile from China, it said in a petition filed with the Commerce Department and the International Trade Commission April 10. Commerce will now decide whether to begin AD/CVD investigations, which could result in the imposition of permanent AD/CV duty orders and the assessment of AD and CV duties on importers.
Toyota does support the renegotiated NAFTA, a top executive said at a trade conference in Washington, even though it will require the company to change some of its sourcing to meet the new 75 percent autos rule of origin. Doug Murtha, vice president of corporate strategy and planning for Toyota's North American division, said that the addition of $3 billion in U.S investments were, "to some extent, changes we had to make for USMCA."
International Trade Today is providing readers with some of the top stories for March 25-29 in case they were missed.
Momentum is moving China and the U.S. toward a trade deal, Myron Brilliant, head of international affairs for the U.S. Chamber of Commerce, said while speaking with reporters April 2. "We're getting into the end game phase" with China, he said. Brilliant said the negotiations with the Chinese delegation that will begin April 3 will be critical to reaching a resolution at the end of April, as both sides desire. But Brilliant emphasized that the business community is more interested in a comprehensive, durable deal that resolves long-standing complaints on discrimination against foreign companies operating in China and subsidies for Chinese firms than in reaching a quick deal.
The International Trade Commission recently posted Revisions 1 and 2 to the 2019 Harmonized Tariff Schedule. According to its change record, Revision 1 adds new note 20(i) to subchapter III of Chapter 99 to implement the latest set of Section 301 exemptions announced by the Office of the U.S. Trade Representative (see 1903210048). New HTS subheading 9903.88.06 is added for products that benefit from the new set of exclusions. Also, General Statistical Note 4(d) is amended to add unit of quantity abbreviation “A” for amperes, and remove the abbreviation “gr cntnrs” for gross containers. Revision 2 adds a new section to the rules of origin under the U.S.-Morocco Free Trade Agreement in General Note 27 for goods of chapter 62, as announced by USTR on March 22 (see 1903210042). That change, the only in the now-current Revision 2 edition of the HTS, takes effect April 1.
A bill introduced this week by two Democrats that would give Congress some say on Section 301 tariffs (see 1903280054) was endorsed by Freedom Partners March 29. The pro-business group's executive vice president, Nathan Nascimento, said: "This bill is another signal that there is growing momentum for Congress reclaiming its authority over tariffs. Americans pay enough in taxes as it is without the executive branch imposing new levies unilaterally.”
Tariffs levied in the name of national security, whether under Section 232 or other statutes, could only last 120 days without affirmative congressional approval under a proposed bill from Sen. Tim Kaine, D-Va., and Sen. Tom Carper, D-Del. This approach is similar to what's being considered in the Senate Finance Committee, but this bill, introduced March 27, also provides more information and consultation for Section 301 tariffs, such as those currently applied to Chinese goods. Under Section 301, the International Trade Commission would receive descriptions about what products will face tariffs, and at what rates, how long a tariff would last, and the ITC would produce a report on the impact on the economy. The bill would allow Congress to pass a joint resolution of disapproval of these tariffs, but that vote could be vetoed by the president. The bill is called the ‘‘Reclaiming Congressional Trade Authority Act of 2019.’’
Senate Finance Committee Chairman Chuck Grassley, R-Iowa, is finding a way to bridge the gap between an approach that would roll back existing Section 232 tariffs and prevent any new ones without congressional assent and an approach that would leave metals tariffs in place and give Congress the opportunity to rein in Section 232 authority only by disapproving tariffs that have been levied. The latter tack would require a veto-proof majority (see 1902120033).