The Court of International Trade will stop liquidation of unliquidated entries subject to the List 3 or 4A Section 301 China tariffs imported by the thousands of plaintiffs in the Section 301 litigation, a majority of judges on the three-judge CIT panel said in a July 6 opinion that granted a preliminary injunction. "To give the parties time to implement appropriate procedures, gather pertinent information, and otherwise take necessary action to comply with this order, the court will temporarily restrain liquidation of any unliquidated entries of merchandise imported from China by any plaintiffs in the Section 301 Cases which are subject to List 3 or List 4A duties," it said.
Section 301 Tariffs
Section 301 Tariffs are levied under the Trade Act of 1974 which grants the Office of the United States Trade Representative (USTR) authority to investigate and take action to protect U.S. rights from trade agreements and respond to foreign trade practices. Section 301 of the Trade Act of 1974 provides statutory means allowing the United States to impose sanctions on foreign countries violating U.S. trade agreements or engaging in acts that are “unjustifiable” or “unreasonable” and burdensome to U.S. commerce. Prior to 1995, the U.S. frequently used Section 301 to eliminate trade barriers and pressure other countries to open markets to U.S. goods.
The founding of the World Trade Organization in 1995 created an enforceable dispute settlement mechanism, reducing U.S. use of Section 301. The Trump Administration began using Section 301 in 2018 to unilaterally enforce tariffs on countries and industries it deemed unfair to U.S. industries. The Trump Administration adopted the policy shift to close what it deemed a persistent "trade gap" between the U.S. and foreign governments that it said disadvantaged U.S. firms. Additionally, it pointed to alleged weaknesses in the WTO trade dispute settlement process to justify many of its tariff actions—particularly against China. The administration also cited failures in previous trade agreements to enhance foreign market access for U.S. firms and workers.
The Trump Administration launched a Section 301 investigation into Chinese trade policies in August 2017. Following the investigation, President Trump ordered the USTR to take five tariff actions between 2018 and 2019. Almost three quarters of U.S. imports from China were subject to Section 301 tariffs, which ranged from 15% to 25%. The U.S. and China engaged in negotiations resulting in the “U.S.-China Phase One Trade Agreement”, signed in January 2020.
The Biden Administration took steps in 2021 to eliminate foreign policies subject to Section 301 investigations. The administration has extended and reinstated many of the tariffs enacted during the Trump administration but is conducting a review of all Section 301 actions against China.
The following lawsuits were filed at the Court of International Trade during the week of June 28 - July 4.
Rep. Jodey Arrington, a Republican on the Ways and Means Committee, was cool to fellow Texas delegation member Sen. John Cornyn's proposal to study the possibility of allowing goods made in foreign-trade zones to be considered originating under USMCA.
The following lawsuits were filed at the Court of International Trade during the week of June 21-27.
Rep. Kevin Brady of Texas, the top Republican on the House Ways and Means Committee, told reporters during a press conference June 24 that there's strong bipartisan support for bringing back expired Section 301 exclusions, and refunding the tariffs paid since they expired.
The Republicans on the House Ways and Means Committee expressed disappointment at the Generalized System of Preferences bill introduced by the Trade Subcommittee chairman, so they introduced their own version, which is identical to the amendment that passed the Senate with 91 votes. The bill, introduced June 22 by the top Republicans on the committee and the subcommittee, also renews the Miscellaneous Tariff Bill, but with a few more products removed from the list after additional objections in the House. According to an analysis by Crowell and Moring, the Senate MTB covers 1,423 products, and the House Democrats' version covers 1,363 products. A spokesperson for Rep. Vern Buchanan, R-Fla., said the Republican bill covers the same MTB list as the Democrats' bill.
Senate Finance Subcommittee on International Trade Chairman Sen. Tom Carper, D-Del., and ranking member Sen. John Cornyn, R-Texas, agree that the U.S. should be in the Trans-Pacific Partnership, but the expert witnesses at the hearing they held June 22 showed no path to the U.S. reentering the agreement with the 11 countries that went on to seal the deal. This was despite agreement among most subcommittee members (though not Sen. Sherrod Brown, D-Ohio) and the witnesses that leaving TPP was a tactical mistake that leaves the U.S. at a trade and geopolitical disadvantage.
The following lawsuits were filed at the Court of International Trade during the week of June 14-20.
Although the Senate Finance Committee's bipartisan amendment to the China package received 91 votes, some prominent Democrats on trade in the House aren't sure how its provisions could move in their chamber, if Republicans don't agree to calling them up under suspension, which requires a two-thirds vote for passage.
The following lawsuits were filed at the Court of International Trade during the week of June 7-13.