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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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Nominee for Ambassador to WTO Says Appellate Body Shielded China Distortions
November 30, 2021 by Mara Lee|USTR

Maria Pagan, the nominee to lead the U.S. mission at the World Trade Organization, told Senate Finance Committee members that reforming the appellate body is a top priority because "Appellate Body overreaching has shielded China’s non-market practices and hurt the interest of U.S. workers and businesses." She said that appellate body rulings "undermined our ability to protect U.S. workers and businesses from those non-market practices."

Topics:Section 301 tariff exclusions, U.S. Trade Representative (USTR), Customs duty, World Trade Organization (WTO), USMCA, Forced Labor
CBP Issues Harmonized System Update with Section 301 Exclusion Extensions
November 24, 2021 |Customs

CBP created Harmonized System Update (HSU) 2113 Nov. 23, containing 2,552 Automated Broker Interface records and 619 Harmonized Tariff Schedule records, it said in a CSMS message. The update includes changes to reflect short-term and long-term extensions on exclusion from Section 301 tariffs for goods used in treating COVID-19 (see 2111100037). Eighteen COVID-19 exclusions that were extended through Nov. 30 will expire after that (see 2111170070). The update also includes changes related to reporting the country of origin for clock and watch parts (see 2111080028). CBP said it also recently created HSU 2112 with 124 ABI records and 27 HTS records.

Proposed Retaliatory Tariffs Over Turkish GSP to Be Terminated
November 22, 2021 by Mara Lee|Top News

The Office of the U.S. Trade Representative said that since Turkey agreed to remove its digital services taxes before the international tax agreement takes effect, "the United States will terminate the currently-suspended additional duties on goods of Turkey that had been adopted in the DST Section 301 investigation." The goods that could have been targeted with additional 25% tariffs were in 32 subheadings, and there was more than $300 million worth of the products imported from Turkey in 2019 (see 2106020047).

Topics:Customs duty