The PowerPic wireless-charging picture frame for mobile phones imported from China under the 8504.40.85.00 subheading was one of 68 exclusions the Office of the U.S. Trade Representative granted from the List 3 Section 301 tariffs, said Monday’s Federal Register. The exclusions are retroactive to Sept. 24, 2018, when the tariffs took effect at 10 percent before being raised to 25 percent months later. “After a great deal of time, effort and expense by our small company, we are 100% convinced that there are no manufacturers anywhere in the world but in China which can produce our products at prices and in quantities needed to allow us to succeed in selling to consumers,” said importer Twelve South in its PowerPic exclusion request.

“Financial impacts” of the French digital services tax and DST “implications for the US tax base” worry the tech industry, posted international tax law expert Gary Sprague with Baker McKenzie in docket USTR-2019-0009. Sprague asked to testify for Amazon, Facebook, Google, Microsoft and others at the hearing Tuesday on the Office of the U.S. Trade Representative’s December finding that France’s DST discriminates against U.S. companies (see 1912030002). USTR is proposing to slap up to 100 percent retaliatory tariffs on 63 subheadings of French imports worth about $2.4 billion in 2018 customs value. Tech “strongly" backs the work of the Organisation for Economic Co-operation and Development to draft a “consensus solution” that would obviate the need for the French DST and similar other tax remedies that can harm U.S. interests, said Sprague. France's tax has “encouraged several other countries to pursue similar discriminatory taxes,” said Sprague, a member of the OECD technical advisory group studying the treatment of e-commerce revenue in tax treaties. The vast majority of the hundreds who have requested to testify are wine importers opposing the proposed tariffs on French goods. Written comments on USTR's proposed tariffs are due Monday. Post-hearing rebuttals are due Jan. 14.

President Donald Trump will sign “our very large and comprehensive” phase one trade deal with China in a White House ceremony Jan. 15, he tweeted Tuesday. “High level representatives of China will be present,” said Trump, not specifying who. “At a later date I will be going to Beijing where talks will begin on Phase Two!” The Jan. 15 signing would be 33 days after the U.S. and China announced the phase one deal Dec. 13 (see 1912130042). The pact includes a broad Chinese commitment to buy U.S. agricultural goods and the Trump administration’s agreement to suspend the List 4B tariffs from taking effect Dec. 15 and to roll back the List 4A tariffs by half to 7.5 percent. The administration has been silent on when the rollback would take effect but said the 25 percent tariffs will remain in place indefinitely on the first three rounds of dutied Chinese goods. Trump’s Tuesday suggestion that the phase two talks would begin at an unspecified later date didn’t square with his Dec. 13 pronouncement that those negotiations would begin immediately.

The China Ministry of Commerce doesn't like provisions in the 2020 National Defense Authorization Act that target Huawei and ZTE. The law bars the Trump administration from lifting the Commerce Department Bureau of Industry and Security's addition of Chinese telecom equipment manufacturer Huawei to its export entity blacklist without congressional approval (see 19121700590). The law also requires reports to Congress on waivers issued to companies doing business with Huawei, and ZTE's compliance with a 2018 agreement that lifted Commerce's ban on U.S. companies selling telecom software and equipment to ZTE. “We have noticed that the U.S. National Defense Authorization Act for FY 2020 has been signed into law, which contains a number of unfavorable provisions for Chinese companies,” a ministry spokesperson said during a Thursday news conference, according to an unofficial translation. “China is firmly opposed to this,” he said. Specifically, “the Chinese side believes that the provisions of the act on restricting the purchase of Chinese products and tightening export control sanctions against Chinese enterprises are a bad example of state intervention in the normal business activities of enterprises, which is in stark contrast to the fairness, equality, and free trade promoted by the United States,” the spokesperson said. China plans to “pay close attention to the impact on the Chinese enterprises during the implementation of the 'Bill' and take all necessary measures to protect the legitimate rights and interests of Chinese enterprises,” he said. President Donald Trump signed the NDAA Dec. 20.

The Commerce Department renewed the charter for the Advisory Committee on Supply Chain Competitiveness, said Thursday's Federal Register. The committee provides advice “on the necessary elements of a comprehensive policy approach to supply chain competitiveness designed to support U.S. export growth and national economic competitiveness,” it said.

Enactment of the U.S.-Mexico-Canada Agreement on free trade would increase federal tariff revenue by $230 million in 2023 and $360 million in 2024, estimated the Congressional Budget Office last week. CBO projects that “certain imports of motor vehicles and parts” that currently enter the U.S. duty-free under North American Free Trade Agreement would no longer be eligible for such treatment under the stricter rules of origin in USMCA. It expects that some of what was made would be replaced by domestic production, but some would be replaced by imports subject to tariffs.

Mobile Defenders is seeking an exclusion from the 15 percent Section 301 tariffs on the iPhone repair parts it has paid on imports from China since the List 4A duties took effect Sept. 1, it posted Friday in the Office of the U.S. Trade Representative public docket. “Mobile Defenders has not identified a source outside of China that is able to meet U.S. demand for these repair components in the coming year,” said the parts wholesaler. Smartphones themselves escaped tariff exposure when the Trump administration pulled the Dec. 15 List 4B duties off the table with the U.S-China phase one trade deal. Though availability of iPhone parts remains concentrated in China, sourcing of replacement components for other smartphones is scattered among various countries throughout the world. Census Bureau statistics accessed through the International Trade Commission’s DataWeb tool showed that besides China, Canada, the Czech Republic, Malaysia, Mexico, South Korea, Taiwan, Thailand and Vietnam are the main countries of origin for smartphone replacement parts imported to the U.S. under the 8517.70.00.00 subheading for which Mobile Defenders seeks a tariff exemption on goods from China. U.S. importers faced $318.9 million in tariff exposure on the smartphone parts they sourced from China in September and October, the first two months the List 4A duties were in effect, said DataWeb. China was responsible for 47.7 percent of all smartphone-parts imports to the U.S. in August, but that share slipped to 40.5 percent as U.S. importers shifted their sourcing elsewhere to reduce their List 4A tariff exposure, said DataWeb. Besides Mobile Defenders, Apple itself was the only other importer to seek an exemption on 8517.70.00.00 iPhone parts from China since USTR began accepting List 4A applications Oct. 31.

Section 301 List 4A tariff exclusion requests topped 1,000 Thursday, 49 days after the Office of the U.S. Trade Representative opened the public docket to applications on Halloween. Applicants that are granted exclusions can qualify for refunds of the 15 percent tariffs they paid retroactive to Sept. 1 when the duties took effect. List 4A tariffs remain in effect at 15 percent but are expected to be rolled back by half after the U.S-China phase one trade deal is signed in January. Under USTR rules, tariff exemptions are granted on all goods imported under a product classification, not just to the company making the exclusion request. Nine applications were filed through Thursday to exempt goods imported under the 8517.62.00.90 tariff subheading, more than for any consumer tech product with List 4A exposure. The subheading includes a broad range of consumer tech goods, including smart speakers, Bluetooth headphones, fitness trackers and smartwatches. Virtually all List 4A exclusion requests filed by all companies through Nov. 29 were elevated to the status of a “stage 2 initial substantive review,” the docket shows. The final “stage 4" is when an exclusion request is granted and approved for Federal Register publication. None of the List 4A applications filed since Oct. 31 progressed above stage 2.

The Commerce Department extended until Jan. 10 the deadline for comments its proposed new procedures for reviewing transactions, including imports, that involve information and communications technology and services and are seen as a potential threat (see 1911260044), says Monday’s Federal Register. Industry groups requested the extension beyond the original due date of Dec. 27.

CTA hailed the House's "swift" 385-41 OK of legislation ratifying the U.S.-Mexico-Canada Agreement on free trade, saying the Senate "now needs to do its part." USMCA "will help American technology leadership and ensure business of all sizes thrive in a competitive global marketplace," said CTA President Gary Shapiro. USMCA's "modernized provisions will help ensure that North American trade policy reflects today’s global economy and will continue to benefit the U.S. economy," said David French, National Retail Federation senior vice president-government relations. "USMCA is a meaningful trade victory that will provide benefits for decades to come.”