Syringe Importer Says 100% Tariff Hike Not Related to Section 301 Action, Violated Trade Act

Texas-based syringe importer Retractable Technologies took to the Court of International Trade to contest the 100% increase of Section 301 tariffs recently imposed on needles and syringes from China. The complaint is seeking a temporary restraining order and a preliminary injunction against the duties, claiming that the tariffs could send the company out of business (Retractable Technologies v. United States, CIT # 24-00185).

Such a result would cause the "loss of nearly" 200 "high-paying American jobs, but also significantly impair both Retractable and the U.S. Government's ability to respond to a major public health emergency," the brief said.

Retractable is claiming that the imposition of the duties, which it said came as part of a supply chain resilience inquiry conducted by the Office of the U.S. Trade Representative and the White House rather than as part of a recently completed four-year Section 301 review, violated both the Trade Act of 1974 and the Administrative Procedure Act. The importer said the tariff hike went beyond the government's Section 301 modification inquiry, since it wasn't based on "any section 301 inquiry" as required. USTR also "failed to consult with any representative of Retractable," in violation of the Trade Act, and didn't conduct "reasoned decision-making," in violation of the APA, the importer alleged.

USTR announced its intent to start the four-year review of the duties in 2022, though at the time it didn't mention syringes or needles or indicate any intent to raise tariffs on Harmonized Tariff Schedule subheadings 9018.31.00 or 9018.32.00, the complaint said. USTR later formed a Section 301 committee to conduct the review. Retractable said that while the review was ongoing, the commerce secretary and White House National Economic Council met with the CEO of the company's biggest rival, Becton, Dickinson and Co. to discuss hiking tariffs on needles and syringes.

In March 2024, USTR then issued a notice titled "Promoting Supply Chain Resilience," asking for comments on domestic supply chain concerns. Retractable said the notice "was unrelated to the Section 301 inquiry" and didn't mention needles or syringes at all. A hearing was held on supply chain resilience in May 2024, during which a representative from the Coalition for a Prosperous America, which allegedly was providing consulting services to Becton, Dickinson, spoke against U.S. reliance on Chinese syringe production.

In May 2024, USTR sent its Section 301 report to President Joe Biden, asking for new tariffs on needles and syringes. The report has one sentence on the products, claiming that upping the duties on needles and syringes "will help maintain alternative sources." The president told USTR to impose tariffs on "personal protective equipment (facemasks, medical gloves, and syringes and needles)." While needles and syringes aren't PPE, Biden told USTR to up the duties for these items to 50%.

USTR then increased the duties on needles and syringes in the results of its Section 301 review.

Retractable said the move violates Section 307 of the Trade Act, which only allows modification of Section 301 action for actions "being taken under Section 301." Since USTR "did not undertake an analysis of any Section 301 factors in connection with the proposed syringe and needle tariff," the move violates Section 307, the brief said. USTR's report to the president discussed Chinese trade policies and other Section 301 factors on all categories of new tariffs, "except syringes and needles," the importer claimed.

The importer also faulted USTR for failing to consult with it before proposing the tariff and limiting the inquiry to whether the tariffs should be greater than 50%, meaning no comment period was available on whether the tariffs should be raised at all. Retractable said the duties were "arbitrary and capricious, in excess of USTR's statutory authority, done without observance of procedure required by law, and supported by substantial evidence," in violation of the APA.