Industry Associations Ask BIS for Changes to Section 232 Exemption Process

Some major industry associations are “deeply concerned” that the process for requesting product exclusions from Section 232 tariffs on steel and aluminum “is not working well,” they said in comments to the Bureau of Industry and Security on the agency’s interim procedures. “The deficiencies in the product exclusion request process are negatively impacting U.S. manufacturers and their ability to obtain product exclusions in a timely and efficient manner,” said the National Foreign Trade Council, one of those industry groups, in a press release.

Submitted May 17 by the Alliance for Competitive Steel and Aluminum Trade, a coalition formed to oppose the new tariffs comprising 48 trade groups including the National Retail Federation, the American Petroleum Institute and the Grocery Manufacturers Association, the comments urge Commerce “to revise the regulations governing this process to ensure that U.S. companies can obtain the relief they deserve in this challenging trade environment,” the NFTC said. BIS issued its interim rule March 19 (see 1803190028). Comments on the interim regulations are due May 18.

Specifically, the interim regulations say requests may only come from entities that use steel and aluminum in their business activities, precluding trade associations from filing consolidated exclusion requests. That makes for an inefficient process by requiring a series of separate filings from different companies requesting the same exemption. The restriction also makes it harder for small businesses to obtain exemptions, the comments said. Similarly, the interim procedures also require separate requests for each variation of a product, even if they fall under the same tariff subheading.

The interim rule also causes uncertainty by basing the effective date of exemptions the date on which their comments are posted by BIS, “a date they cannot control since BIS has complete discretion as to when to post filed comments,” the trade groups said. “The time period between filing an exclusion request and the posting of that request appears to be taking weeks. This delay lengthens the overall time period during which imports which may ultimately qualify for a refund will never be entitled to a refund even if the related product exclusion request is ultimately granted,” they said.

The final regulations should also create an expedited process for renewing refund requests, which expire after a year. BIS should also be held to a time limit for their initial review of exemption requests. “Companies report that there are extensive delays in this initial vetting process which, in turn, adds significant delay to the overall time frame for the review of the exclusion requests,” they said.

The trade groups pledged their continued overall opposition to the Section 232 tariffs. “The Section 232 tariffs are undermining rather than advancing U.S. economic growth and our broader national security interests,” they said. “While we clearly need to address problems of unfair trade practices, subsidies and global overcapacity in steel and aluminum production, mechanisms exist under our trade laws to address these specific problems without the severe damage that is being inflicted on U.S. producers by the Section 232 tariffs. Therefore, we remain opposed to the Section 232 tariffs and will actively seek their removal.”