The following lawsuits were filed at the Court of International Trade during the week of April 6-12:
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.
CBP has assessed about $60.8 billion in duties under the major trade remedies started during the Trump administration as of April 8, according to CBP's trade statistics page. That includes $49.6 billion in duties from the Section 301 tariffs on goods from China, and $500 million in Section 301 tariffs on goods from the European Union. CBP also has assessed about $6.9 billion under the Section 232 tariffs on steel and $2.1 billion under tariffs on aluminum. The Section 201 trade remedies on washing machines, washing machine parts and solar cells account for $1.7 billion in assessed tariffs. CBP's statistics account for refunds provided to importers.
The Office of the U.S. Trade Representative will grant one-year extensions to eight exclusions from the first list of Section 301 tariffs on China that were due to expire April 18, it said in a pre-publication copy of a notice posted to its website. The exclusions that weren't extended will expire April 18.
U.S. importers sourced 5.81 million Chinese smartphones in February, according to Census Bureau data accessed April 5 through the International Trade Commission’s DataWeb tool. It was the lowest monthly volume from China since customs began tracking smartphone imports in 2007, and vivid evidence of the COVID-19 pandemic's upending of the Chinese supply chain after the world’s first outbreak in Hubei province in January.
The following lawsuits were filed at the Court of International Trade during the week of March 30 - April 5:
The recently announced exclusions from the Section 301 tariffs on the third list of products from China (see 2003230043) seem to be unintentionally limited by the statutory liquidation timelines, lawyer Chris Kane said in a March 31 LinkedIn post. While the notice allows for retroactive applicability to Sept. 18, 2018, when those tariffs took effect, it's not clear that importers have any way to be fully refunded for that period, he said. The Office of the U.S. Trade Representative published the official notice with numerous tranche three exclusions on March 26 (see 2003230043).
General Motors, noting that its financial resources are strained with a shutdown of vehicle manufacturing, asked the U.S. trade representative last week to lift Section 301 tariffs on eight components it will be importing from China to make ventilators in Kokomo, Indiana. The letter was posted at regulations.gov on April 2.
The Trump administration should “lift” the Section 301 tariffs on more than 60 categories of “healthcare-essential” information and communications technology (ICT) products to help the U.S. fight the COVID-19 pandemic, urged the Information Technology Industry Council. “Relief” from the tariffs “would directly contribute to the U.S. economic and public health response to the current crisis,” ITI said. “A range of ICT products and components are at the heart of detecting and treating illnesses, recording and tracking vital signs, and conducting tests,” it said. Processors, controllers and integrated circuits, for example, imported from China under the 8542.31.00 tariff code are “foundational to a variety of medical equipment,” it said. List 2 tariffs on 8542.31.00 goods were imposed in August 2018 and are still in effect at 25%. Lifting the tariffs “will help to alleviate the strain on the healthcare system in the midst of dealing with COVID-19,” ITI said. “Tariffs act as direct impediments to U.S. governments, consumers and businesses, and we would encourage the removal of tariffs by any means to increase confidence in the COVID-19 response and support economic recovery.” While others, including Sen. Susan Collins, R-Maine, and the U.S. Chamber of Commerce have urged the administration to defer the tariffs for 90 days, ITI is asking for the duties’ outright removal.
A domestic producer coalition filed petitions on March 31 with the Commerce Department and the International Trade Commission requesting new antidumping duty investigations on mattresses from Cambodia, Indonesia, Malaysia, Serbia, Thailand, Turkey and Vietnam, and new countervailing duties on mattresses from China. Commerce will now decide whether to begin AD/CVD investigations on mattresses from these countries that could eventually result in the assessment of AD/CV duties.
The Office of the U.S. Trade Representative issued another set of product exclusions from the fourth group of Section 301 tariffs on goods from China. The new exclusions from the tariffs include "five 10-digit HTSUS subheadings and seven specially prepared product descriptions, which together cover 36 separate exclusion requests." according to the notice. The product exclusions apply retroactively to Sept. 1, 2019, the date the fourth set of tariffs took effect. The exclusions will remain in effect until Sept. 1.