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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. Subsequent rounds of Section 301 actions against China have continued since. The Office of the U.S. Trade Representative administers Section 301 tariffs, and has also created an exclusion process for importers to seek exemptions from the tariffs.

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Chamber Official Says Currency Pact Could Delay Oct. 15 Tariff Hike
October 10, 2019 by Mara Lee|Top News

There's the possibility of an agreement on currency manipulation this week, according to U.S. Chamber of Commerce Head of International Affairs Myron Brilliant. Brilliant, who spoke with both China's chief negotiator and members of the Trump administration ahead of the Oct. 10 negotiating session, told reporters on a conference call that if the two sides come up with a currency agreement, that might lead to a reprieve for importers who are expecting 25 percent tariffs to go to 30 percent on Oct. 15.

Fitbit to Shift Sourcing Outside China in January to Escape Tariff Exposure
October 9, 2019 |Trade Business

Fitbit will shift production to "outside China," starting in January, for “effectively all of its trackers and smartwatches” to escape exposure to the tariffs on Chinese goods, the company said Oct. 9. "[T]hose products will no longer be of Chinese origin and therefore not subject to Section 301 tariffs.” Smartwatches and fitness trackers, comprising the entire product line, were hit with 15 percent List 4A tariffs Sept. 1 as part of the broad category of 8517.62.00.90 goods that also includes smart speakers and Bluetooth headphones (see 1908140031). The company began exploring potential alternatives to China last year, Chief Financial Officer Ron Kisling said. It altered its supply chain and manufacturing operations with “additional changes underway,” the company said. Fitbit will give additional details on its Q3 call within the month.

CBP Sees USTR's Draft Exclusions, Not Individual Petitions, in Section 301 Exclusion Reviews
October 9, 2019 by Tim Warren|Top News

CBP's role in considering Section 301 exclusion requests is limited to a review of drafted exclusions from the Office of the U.S. Trade Representative, a CBP spokesperson said. Asked whether CBP sees the full exclusion requests in their entirety, the spokesperson said "CBP does not review individual petitions for exclusions to the remedy." USTR "evaluates and approves requests for exclusions to the China 301 remedy," the CBP spokesperson said.

August TV Imports From China Jumped 22.3% From July, but Tariffs’ Impact Hard to Discern
October 8, 2019 |Trade Business

August TV unit imports from China increased 22.3 percent sequentially from July, and 37.5 percent year over year, according to newly published Census Bureau statistics accessed Sunday through the International Trade Commission’s DataWeb tool. Observers will debate whether the August spikes were evidence of importers speeding product through U.S. ports to beat the 15 percent Section 301 tariffs on finished TV sets from China that took effect Sept. 1.

‘Harder’ to Mitigate Tariffs on ‘Bigger-Ticket’ Items, Says Costco CFO
October 4, 2019 by Paul Gluckman|Top News

Costco is experiencing “a lot of moving parts” with the Section 301 tariffs on Chinese goods, including a few price increases “along the way,” said Chief Financial Officer Richard Galanti on a fiscal Q4 call on Oct. 3. Costco has tariff exposure to many of the products on “the first three lists,” and “we'll just have to wait and see” the impact if those tariffs rise to 30 percent as scheduled Oct. 15, he said.

Topics:Customs duty
About $41 Billion Assessed in Duties Under Sections 301, 232, 201 Trade Remedies, CBP Says
October 3, 2019 |Customs

CBP has assessed about $41 billion in duties under the major trade remedies started during the Trump administration as of Oct. 2, according to CBP's trade statistics page. That includes $31 billion in duties from the Section 301 tariffs on goods from China, up around $4 billion from about a month ago. The assessed tariffs under Section 301 now include the 15 percent tariffs that took effect on Sept. 1 (see 1908270066). CBP also has assessed about $8.1 billion under the Section 232 tariffs on steel and $1.7 billion under tariffs on aluminum. The Section 201 trade remedies on washing machines, washing machine parts and solar cells (see 1801230052), imposed Jan. 23, 2018, account for $1.1 billion in assessed tariffs.

Topics:Customs duty, Section 232 Tariffs, Generalized System of Preferences (GSP), Forced Labor