Section 201 Safeguards

The American Institute for International Steel and two companies filed a lawsuit June 27 at the U.S. Court of International Trade over the constitutionality of Section 232 of the 1962 Trade Expansion Act. The suit claims that Section 232 is unconstitutional because it delegates such broad authority to the president and there is no judicial review to those broad powers. "The lawsuit seeks a declaration that the law relied on by President Trump to impose that tariff is unconstitutional, as well as a court order preventing further enforcement of the 25% tariff increase," AIIS said in a news release. The trade group also asked that a three-judge panel hear its case, because that would allow an appeal to go straight to the Supreme Court.

The U.S. Court of Appeals for the Federal Circuit on June 15 ruled against a challenge to Section 201 safeguard duties on solar cells, affirming a recent Court of International Trade decision not to put the duties on hold by way of an injunction. Like CIT did in a “careful and thorough opinion” issued in March (see 1803060027), the Federal Circuit found Silfab, a U.S. importer, and two Canadian exporters, Heliene and Canadian Solar, are not likely to succeed in their challenge because President Donald Trump acted within his authority when he issued the Section 201 safeguards. Among other things, the appeals court found that disagreement at the International Trade Commission and the lack of a unified recommendation on remedy doesn’t mean Trump couldn’t set the tariffs anyway, because the ITC had already found injury, CAFC said. The president also had the authority to set duties on Canada despite the lack of an ITC recommendation to do so, CAFC said.

South Korea began a World Trade Organization challenge of recent Section 201 safeguard duties imposed by the U.S. on large residential washers and solar cells and modules, the WTO said in a news release. South Korea requested consultations with the U.S. on May 16, saying “the measures are inconsistent with a number of provisions under the WTO's Agreement on Safeguards and the General Agreement on Tariffs and Trade (GATT) 1994,” the WTO said. Under WTO rules, South Korea may request the formation of a panel to adjudicate the case if consultations don’t resolve the dispute after 60 days. South Korea’s challenge follows a dispute on the safeguard duties filed by China in February (see 1802070022).

It’s of the “utmost importance” that importers ensure their mailing addresses in ACE and Automated Clearinghouse (ACH) numbers are up to date as CBP begins processing refunds for entries during the recent lapse in the Generalized System of Preferences program, a CBP official said on CBP’s biweekly ACE call held April 26. CBP prefers that the information be updated electronically, as processing of paper requests may not happen until after refunds checks have been cut and mailed, which should happen for most filers by mid-July, the official said.

Benefits under the Generalized System of Preferences (GSP) mostly won't apply to goods subject to recently implemented tariffs on solar panels, washing machines, aluminum and steel, said CBP in on its website. President Donald Trump imposed new Section 201 safeguard tariffs on imports of large residential washers and solar cells and modules in January and Section 232 tariffs on steel and aluminum in March.

CBP will have the ability to grant up to 300 days to reject entry summaries that are subject to new or coming tariffs, CBP said in a CSMS message. CBP will allow for up to 300 days, "with supervisory approval," for "rejecting entry summaries subject to import measures under Sections 201 and 301 of the Trade Act of 1974, and Section 232 of the Trade Expansion Act of 1962," CBP said. CBP also extended the time period for rejecting antidumping/countervailing duty entry summaries to 300 days "with supervisory approval," it said.

Panelists at the Center for Strategic and International Studies agreed that the process to determine whether imports violate domestic companies' intellectual property works well, but said once an exclusion order is issued by the International Trade Commission, enforcement can be tricky.

The International Trade Commission on March 23 issued Revision 2 to the 2018 Harmonized Tariff Schedule. The main reason for the update was to implement new Section 232 tariffs on aluminum and steel products (see 1803230060). The ITC also made technical corrections and changes related to recently imposed Section 201 safeguard duties on solar cells and residential washers. The changes, most of which took effect March 23, are as follows:

Canada has requested a panel be formed to settle its complaints over how the U.S. used differential pricing methodology to determine antidumping duties on softwood lumber, and its dispute on countervailing duties against the commodity, as well. This means the countries could not come to agreement during the consultations process. That item, among others, will be discussed at the March 27 dispute settlement body, according to an agenda posted at the end of last week. The United States will share a status report on its antidumping and countervailing duties against Korean washers, a dispute that started in 2014. On March 16, the U.S. said it is continuing to consult with interested parties on how to address the recommendations of the appellate panel on the tariffs. These consultations were an earlier attempt to deal with Korean imports, and different from the safeguard tariffs against Korean washers implemented to protect domestic industry under section 201 (see 1801230052).

The International Trade Commission recently issued further changes to the Harmonized Tariff Schedule meant to implement Section 201 safeguard duties on solar cells. Changes to 10-digit statistical suffixes in the tariff schedule allow for reporting of photovoltaic generators and solar modules comprising lead-acid batteries attached to solar cells. The modifications, approved by the interagency “484(f)” Committee for Statistical Annotation of Tariff Schedules, took effect March 1.