There’s no question China “has engaged in unfair trade practices such as forced technology transfer and intellectual property theft,” Sen. Dianne Feinstein, D-Calif., wrote to U.S. Trade Representative Robert Lighthizer June 17, as posted July 16 in docket USTR-2019-0004. “The question is whether the broad-based tariffs imposed and proposed by the current administration are the right approach to addressing such issues,” Feinstein said. “They are not.” The Section 301 tariffs on Chinese imports “threaten U.S. jobs and businesses, including so many of those in California that rely on international trade,” she said. “The ports of Los Angeles and Long Beach, which handle nearly half of the container trade with China, have seen the flow of goods slowed due to the tariffs and the uncertainty surrounding them.” Feinstein has heard from “numerous” California companies “about the pain the tariffs are causing them,” she said. The tariffs are “disrupting their supply chains and raising their costs of doing business in ways that damage their competitiveness and in some cases, threaten their existence,” she said. The “primary impact” of the proposed List 3 tariffs “will be to damage our own citizens, businesses, and economy,” she said. “I urge you to pursue alternative approaches to address real trade issues with China.” Three rounds of 25 percent tariffs remain in effect on roughly $250 billion worth of Chinese imports. President Donald Trump last month delayed putting the threatened List 4 duties into effect on virtually all remaining Chinese goods as the U.S. and China try to restart talks toward a comprehensive trade deal (see 1906290001).
International Trade Today is providing readers with some of the top stories for July 8-12 in case they were missed.
The country of origin for watches is largely based upon where the watch "movement" is produced, but the origin of watch bands and cases is determined by whether the assembly is completed in the same country where the movement was made, CBP said in a June 25 ruling. Seiko Watch of America, through Ernst & Young, asked CBP to rule on how the company should declare country of origin in four scenarios and whether Section 301 duties might apply. CBP found that only in one of the scenarios would the proposed fourth list of Section 301 tariffs not apply.
For firms or trade groups that wish to testify on the Section 301 investigation into France's Digital Services Tax, they should file a request to appear by noon on Aug. 12 for the Aug. 19 public hearing. Filings of comments or testimony should be made at regulations.gov, docket number USTR-2019-0009.
In order to get back in America's good graces, India needs to do more than open its market to American dairy and pay medical device companies fairly, according to Jeffrey Gerrish, deputy U.S. trade representative. Those were the trade irritants that led to India's suspension from the Generalized System of Preferences, but at a U.S. India Strategic Partnership Forum leadership summit event July 11, Gerrish said the two countries need to "move beyond" the issues behind the GSP review to a more comprehensive reckoning.
Correction: The sixth list of Section 301 tariff exclusions only includes 110 subsets of tariff numbers in chapters 84, 85 and 90 (see 1907080023).
Freshman Democrat Stephanie Murphy of Florida is already making a name for herself on trade, both during House Ways and Means Committee hearings and through leading an effort to restrict the administration's ability to levy tariffs on national security grounds without congressional approval.
Two Wiley Rein lawyers blogged July 11 that the Section 301 investigation into French taxation of digital services is not a twin to the 301 investigation of China's abuses of the trading system. "This is not the start of a trade war with France," Stephen Claeys and Timothy Brightbill wrote. There will not necessarily be tariffs on French goods as a result of this investigation, they said. The U.S. trade representative could enter into negotiations with France, restrict service sector access for French firms, or take other actions short of tariffs.
CBP will add the ability in ACE for importers to file entries with the sixth group of exclusions from the first tranche of Section 301 tariffs on July 11, it said in a CSMS message. Filers of imported products that were granted an exclusion (see 1907080023) should report the regular Chapter 84, 85 or 90 Harmonized Tariff Schedule number, as well as subheading 9903.88.11, for products subject to Section 301 duties on products from China but that have been granted an exclusion by the Office of the U.S. Trade Representative. “Importers shall not submit the corresponding Chapter 99 HTS number for the Section 301 duties when HTS 9903.88.11 is submitted,” CBP said.
Though President Donald Trump delayed imposition of List 4 Section 301 tariffs to restart negotiations with China toward a comprehensive trade deal, retailers continue stocking up on inventory as a hedge against the duties taking effect on short notice, the National Retail Federation said July 10. Imports at major U.S. retail container ports will remain at high levels this summer, “but are expected to grow only modestly compared with last year’s rush to bring merchandise into the country ahead of scheduled tariff increases,” the NRF said. “Retailers still want to protect their customers against potential price increases that would come with any additional tariffs, but with the latest proposed tariffs on hold for now and warehouses bulging, there’s only so much they can do,” it said. “We will still see some near-record numbers this summer, but right now no one knows whether there will be additional tariffs or not.” U.S. ports handled 1.85 million 20-foot-long cargo containers or their equivalents in May, up 6 percent from April and a 1.4 percent increase from May 2018, the NRF said. It’s estimated that ports handled 1.87 million containers in June, an increase of only 0.8 percent year-over-year. The July forecast is for 1.93 million containers to be handled, which would be 1.3 percent higher than the July 2018 volume, it said: “The small year-over-year increases expected in the next few months compare with double-digit growth in multiple months last year as retailers rushed to import Chinese merchandise ahead of expected tariff increases.”