Vehicle Side Bar Exporter Says Section 301 Tariff Exclusion Not Principal Use Provision

An exporter of vehicle side bars said April 8 that Section 301 tariff exclusions shouldn't necessarily be considered princpal use provisions, but should instead be analyzed as either principal use, eo nomine or actual use provisions on a case-by-case basis because no published guidance singles out a specific method (Keystone Automotive Operations v. U.S., CIT # 21-00215).

The plaintiff, exporter Keystone Automotive Operations, said that the U.S. was wrong in its cross-motion for summary judgment to claim that Keystone’s vehicle nerf bars, side bars and bars were “step bars,” not “side protective attachments” that would be eligible for an exemption from a 25% Section 301 tariff (see 2402160055). It itself sought summary judgment in December (see 2312080051).

Keystone said that the government’s motion “hinges entirely on a critical fallacy” that the Section 301 exclusion is a principal use provision rather than an eo nomine one. It said the U.S. then uses this “fallacy” to argue that the exporter’s products aren't covered by the tariff exclusion because they are “‘principally used’ as a class of goods that exists nowhere in the Harmonized Tariff Schedule.”

Nothing in the Federal Register indicates whether Section 301 exclusions should be considered eo nomine, principal use or actual use provisions, Keystone said.

It said it maintains that “each exclusion stands for itself,” and that the exclusion for vehicle side protective attachments should be considered an eo nomine provision because its language includes “no inherent additional characteristics, qualifications, or limitations.” Understanding it otherwise would add a limitation to the exclusion that its drafters had not intended, it argued.

“This should not be allowed,” it said.

The side protective attachments exclusion’s language mirrors the language of an eo nomine provision in the Harmonized Tariff Schedule, the exporter said. There are none of the terms that are “generally found” in principal use provisions, such as “use,” “used,” “for use in,” “designed for use,” and so on, it claimed. On the other hand, it said, an eo nomine provision generally “describes an article by a specific name” and “includes all forms of the named article,” as does the exclusion.

And it pointed out that Section 301 exclusions are written by the Office of the U.S. Trade Representative, not by Congress, CBP or the International Trade Commission, meaning that the exclusions’ drafters may have had a different understanding of how their language would be applied to products.

Therefore, the court should look to the products for which the exclusion request was originally drafted, Keystone said: Smittybilt Side Armor sold by Polaris Industries. This product is “functionally identical” to Keystone’s, it said, and is actually less protective in some ways.

“It is only logical to ascertain what specific class or kind of products the USTR intended to cover by drafting the ‘side protective attachment’ exclusion through an examination of Polaris’s original exclusion request,” it said.

Under that reading, the exclusion clearly covers Keystone’s side bars, the exporter said.

It said that all the bars have to do is meet the description of “side protective attachments,” and even the government admitted that the bars provide “moderate protection against road hazards and debris.”

“Plaintiff has established that the subject merchandise provides superior stone pecking protection to the side of the vehicle, protects the side of the vehicle from damage caused by various road hazards and road debris, protects the vehicle from side impacts, and enhances mild anti-collision protective capabilities with shopping carts and other potential hazards that would cause damage to the vehicle’s exterior,” it said.