USTR Says Section 301 List 3 Exclusions Coming, Unclear Whether Process Will Continue if Tariffs Dropped

U.S. Trade Representative Robert Lighthizer told one Democrat the agency would be starting a Section 301 exclusion process for the largest, third tranche of goods subject to tariffs by the end of April (see 1905020030), but he avoided committing to finishing evaluations of pending exclusions once tariffs are lifted. "USTR will consider all options in the event tariff rates are modified," he wrote to Rep. Jackie Walorski, R-Ind. No exclusion process has launched, even though the April 30 target has passed. USTR's spokeswoman did not respond to a question by press time about when it might launch. All of Lighthizer's responses were posted April 24 as an addendum to the February hearing's transcript.

Several Democrats and Republicans asked the USTR to follow up in writing to questions on the Section 301 exclusion process. Walorski also asked Lighthizer how many staffers are working through the thousands of requests, and what experience they have with classification. He said that about 25 USTR attorneys, paralegals and trade analysts with experience in law, industrial sectors and data analysis are on the job.

Rep. Kenny Marchant, R-Texas, wrote, "There have been increasingly represented concerns presented to me about the cost of the tariffs on imported Chinese goods, many of which are used in residential construction. My home builders tell me there are around 600 products on list 3 commonly used in home building. The National Association of Home Builders has said these products are so common that the 10% tariff in place represents a $1 billion tax of residential construction."

Lighthizer replied that the tariffs are designed to convince Chinese officials to address serious problems in the relationship that if left unaddressed will cost the U.S. in economic growth and technological leadership. "The imposition of tariffs certainly has a cost, but we believe it is essential to our success with China," he wrote.

Rep. Jason Smith, R-Mo., complained that small manufacturers don't have the resources to participate in the complex exclusion process. Lighthizer replied that his office is making considerable efforts to help small businesses apply.

"We designated a single Section 301 hotline to take inquiries from the public. USTR trade specialists staff the hotline during businesses hours and respond to all voicemail messages within 24 hours. We provide a full spectrum of technical services to the public, including helping interested persons submit their exclusion requests to the docket via Regulations.gov, answering questions about the products subject to the additional tariffs, and making referrals to other government agencies on collateral issues. We receive, on average, 20 to 25 calls per day from interested persons. Furthermore, we have worked individually with requesters (mostly small businesses) to correct deficiencies in approximately 1,700 requests," he wrote.