Almost half of companies that responded to the U.S.-China Business Council's annual survey on the business climate in China said they have lost sales in China since the trade war began. The most common reason is because of retaliatory tariffs on U.S. imports to China, according to these 100 multinational firms based in the U.S. Another third said they lost sales because of U.S. tariffs.
The Office of the U.S. Trade Representative announced Aug. 29 that it is seeking comments through Regulations.gov on the efficacy of increasing Section 301 tariffs from 25 percent to 30 percent in order to convince China to stop trade abuses. The office also invites businesses and trade groups to explain if the increase on any particular product would cause disproportionate harm to U.S. consumers or businesses. Comments are due by Sept. 20; the increase is scheduled to take effect Oct. 1.
Derek Scissors, a China scholar at the American Enterprise Institute, has been arguing for decoupling from China for years. He says whether President Donald Trump wins a second term, or a Democrat replaces him, it's likely tech companies will have to change their supply chains and reverse the international approach to research and development. Scissors said in an interview that while apparel and other low-value goods manufacturers were already moving to cheaper countries in Asia, consumer technology firms were happy in China before the trade war began. "You could easily get a Democratic administration that wants to get tech out of China," he said. "Biden's people say they want that."
International Trade Today is providing readers with some of the top stories for Aug. 19-23 in case they were missed.
The manufacturing of major Roomba robotic vacuum subassemblies that occurs in Malaysia is enough for the vacuum to be considered of Malaysian origin, CBP said in a July 31 ruling. Sandler Travis lawyer Paula Connelly, representing iRobot, sought CBP's input on the country of origin. The agency also said the retail set that includes the vacuum is of Malaysia. The vacuum is classified in subheading 8508.11.0000, which was included in the third tranche of Section 301 tariffs on goods from China.
The Office of the U.S. Trade Representative will publish a notice in the Federal Register Aug. 30 that says that List 4 products under the Section 301 action will face an additional 15 percent tariff, not 10 percent, as earlier announced. President Donald Trump had tweeted this change four days ago (see 1908230059). The change in the rate does not affect the dates the goods will face the tariff. One group of products, nearly 3,800 8-digit tariff lines, will be taxed starting Sept. 1; consumer electronics largely will wait until Dec. 15.
Adrienne Braumiller and George Alfonso will offer trade-related lobbying through a new lobbying firm founded by the pair, Braumiller said in an Aug. 26 email. Braumiller, who started the Braumiller Law Group, and Alfonso, who also founded The Law Offices of S. George Alfonso, said the two will partner to create a new lobbying firm called Reigncore. The pair "have combined their unique talents and experiences in international trade and artful persuasion to form the cornerstone of Reigncore, in order to provide the consulting and lobbying services best suited for each client’s specific objectives and goals," Braumiller said in the email. Alfonso will be president and Braumiller will be CEO, though neither will "provide legal counsel or representation," Reigncore said on its website. Lobbying areas include the new NAFTA, Section 301 tariff exclusions, and export control reform efforts, it said.
France's President Emmanuel Macron, speaking at a press conference at the G-7 meeting Aug. 26, said that the U.S. and France have agreed they will work together to reach an agreement in 2020 on modernizing the international tax rules. Macron, who was speaking in French, said that the 3 percent digital services tax is not designed to punish any large companies. Rather, he said, "it's to fix the problem. And there are also plenty of French companies that will be touched by this tax."
CBP created Harmonized System Update (HSU) 1914 on Aug. 13, containing 531 Automated Broker Interface records and 94 Harmonized Tariff Schedule records, it said in a CSMS message. The update includes adjustments required by the Office of the U.S. Trade Representative's announcement of two new sets of exemptions from Section 301 tariffs on China (see 1907290023 and 1908080019). Modifications required by the verification of the 2019 HTS and to support Partner Government Agency message set functionality are included as well.
President Donald Trump said in an Aug. 23 tweet that he is planning an unspecified response to new tariffs that China will impose on U.S. goods. China's tariffs are in relation to the coming Section 301 10 percent tariffs on Chinese goods, most of which will begin on Sept. 1. “Our great American companies are hereby ordered to immediately start looking for an alternative to China, including bringing your companies HOME and making your products in the USA,” Trump tweeted. “We don’t need China” and the U.S. “would be far better off without them,” he said. “The vast amounts of money made and stolen by China from the United States, year after year, for decades, will and must STOP.”