With the publication of the Office of the U.S. Trade Representative’s notice in the July 11 Federal Register on procedures for requesting exclusions from Trade Act Section 301 tariffs on Chinese imports (see 1807100049), docket USTR-2018-0025 for posting such requests became active in the regulations.gov portal. No requests were posted yet as of International Trade Today's deadline. Exclusion requests are due by Oct. 9, and if granted will apply for a year retroactively to July 6, the notice said. Though Oct. 9 is the deadline for the exclusion requests, international trade lawyers at BakerHostetler are advising "clients to file as soon as possible in anticipation of the large administrative backlog that they expect,” the law firm said.
The Section 301 tariffs on goods from China do not apply to covered imports that are part of a set if that set is classified under a subheading that is not included in the Section 301 list, CBP told the National Customs Brokers & Forwarders Association of America. "If the product that imparts the essential character to the set (i.e., the [Harmonized Tariff Schedule of the U.S.] under which the entire set is classified) is covered by the Section 301 remedy, then the entire set will be subject to the additional 25% duties," CBP told the NCBFAA. "If the HTSUS under which the entire set is classified is not covered by the Section 301 remedies, but the set contains a component that is classified in a subheading covered by the 301 list, the 301 duties will not be assessed on the individual component at this time."
Over a two-day review at the World Trade Organization on China's trade policies, China insisted that intellectual property violations are no longer a major issue; that its support of state-owned enterprises is no different from Fannie Mae; and that its overcapacity in steel is not a problem for global steel prices, because China only exports 9 percent of its steel. Moreover, China's Commerce Vice Minister Wang Shouwen said, addressing overcapacity needs collective actions and China stands ready to join hands with other countries to tackle this problem together.
The Section 301 tariffs product exclusion request process announced last week (see 1807060039) was published in the July 11 Federal Register. No changes were made since the first announcement. Requests are due Oct. 9, and, if granted, will apply from July 6, 2018, and last one year. Exclusions will be granted to all importers of the same product, whether or not the company filed a request.
Some leaders on the House Foreign Affairs Committee intend to file legislation to remove China's Most Favored Nation status, according to Rep. Ted Poe, R-Texas, chairman of the Subcommittee on Terrorism, Nonproliferation, and Trade. Poe said in a July 11 interview that Asia Subcommittee Chairman Ted Yoho and the ranking member on both subcommittees are all in agreement on the legislation. China has had MFN status with the U.S. since 1980, but that was made permanent only in 2001. In 1990, in the wake of the Tiananmen Square massacre, Congress included non-binding language suggesting the president rethink MFN for China.
The International Trade Commission recently posted Revision 7 to the 2018 Harmonized Tariff Schedule. Coming just days after the ITC’s mid-year HTS update, the new edition adds provisions implementing a 25% Section 301 tariff on $34 billion in imports from China that took effect July 6. It also reflects the restoration of African Growth and Opportunity Act benefits for Eswatini, and the country’s renaming from Swaziland.
The new tariffs proposed for a broad list of goods from China add to the existing concerns about the Trump administration's trade policy, said the chairmen of the House Ways and Means and Senate Finance committees. Ways and Means Chairman Kevin Brady, R-Texas, asked for an in-person meeting between the U.S. and Chinese presidents. "Despite the serious economic consequences of ever-increasing tariffs, today there are no serious trade discussions occurring between the U.S. and China, no plans for trade negotiations anytime soon, and seemingly little action toward a solution," Brady said in a July 10 statement.
Tech interests will debate the ripple-effect consumer harms that may result from the Trump administration’s newest proposals to impose 10 percent Section 301 tariffs on $200 billion worth of Chinese imports. But the list of goods targeted for the 10 percent duties, released July 10 in an Office of the U.S. Trade Representative notice, doesn't include meaningful end-user consumer tech products like TVs.
The Office of the U.S. Trade Representative’s list of proposed tariff subheadings set for an additional 10 percent tariff on $200 billion in imports from China covers wide swaths of the tariff schedule that initially avoided Section 301 tariffs imposed July 6. While the 25 percent tariff already in place affects only goods of Chapters 84, 85, 86, 87, 88, 89 and 90 (with a few exceptions), USTR’s proposed list of additional subheadings includes products from nearly all sectors of the tariff schedule, with the notable exceptions of footwear and apparel and pharmaceuticals.
International Trade Today is providing readers with some of the top stories for July 2-6 in case they were missed.