Section 232 Investigations Moving More Quickly in 2nd Trump Administration, Lawyer Says
Section 232 investigations are "moving much, much quicker" in the second Trump administration, trade lawyer Daniel Cannistra said May 14 on a podcast.
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Cannistra, a partner at Crowell & Moring, pointed to the investigation on commercial aircraft and parts. He said that even though this investigation "has an administrative process," it is going to be "a very fast moving administrative process." He said that while the steel and aluminum Section 232 investigations from Trump's first term took "the full 270 days" allowed by law, the comment due date for the aircraft investigation is "coming up very, very quickly," on June 3, which indicates the investigation is moving more quickly. Cannistra highlighted the lack of a public hearing for the investigation, which he called "quite interesting." There also is no ability to submit rebuttal comments, which he noted is "something that was allowed in the previous [Section] 232 investigations."
He said that he expects "all these 232 investigations will ultimately result in some form of tariffs." The Commerce Department is currently conducting Section 232 investigations on copper, lumber, trucks and truck parts, critical minerals, semiconductors, pharmaceuticals and now aircraft.
The aircraft investigation is "quite different" from others, he said, because the industry is "particularly strong" and has historically been so in the U.S. He attributed the commencement of the investigation to the "cross over" between parts for automobiles, trucks and aircraft, saying "those things actually cross over into all those three industries." Despite the similarities in parts, he said, these industries are very different, "certainly when you're talking about the difference between a jet engine and a passenger vehicle."
Cannistra said that while the potential tariffs may increase demand for U.S. production, that does not "automatically mean that there is instant supply." Any impact from the tariffs on the commercial aerospace industry will be "long-term," he said.
The commercial aircraft industry is "an area with a very rich negotiation history," he said, wherein foreign governments "will agree to purchase commercial aircraft in exchange for trade concessions in other areas." He said that commercial aircraft is an area "that is more ripe for negotiation than, say, copper or steel, aluminum, 232 tariffs." To him, that indicates that "this particular investigation" will have a "much more political element to it."
He anticipates that the tariff structure following the investigation "could be very different here," because the U.S. is such a large producer of commercial aircraft. In order to support the industry, the U.S. must ensure that its aircraft industry has "access to parts in their supply chain to continue to be a strong economic participant in that industry."