On 15 June 2018 the United States Trade Representative (USTR) released two product lists relating to Section 301 duties. A notice in the Federal Register was published on 20 June 2018 implementing and providing further details regarding the President Trump's determination on Section 301 duties.(1)
The first list (Section 301 – Tariff List 1) is a culmination of a process that started on 13 April 2018, when the USTR published an initial list of products that would be subject to an additional 25% ad valorem tariff. Products from China that are on Tariff List 1 will be subject to the additional 25% duty, effective 6 July 2018. The second list (Section 301 – Tariff List 2) contains 284 additional product lines that will now undergo further review. Pharmaceutical products, textiles, apparel and footwear do not appear on the two recently released lists.
This list covers 818 product lines worth approximately $34 billion in Chinese imports. Approximately 515 product lines from the initial proposed list were removed. The 25% tariff on products imported from China under the eight-digit Harmonised System subheadings included on the final list will take effect on 6 July 2018. The final list has removed items from Chapters 29, 30, 72, 73, 76 and 93 of the Harmonised Tariff Schedule of the United States, as well as other products.
The USTR has also recommended adding 284 product lines to the Section 301 tariffs which cover approximately $16 billion Chinese imports. This list will now undergo further review through a public notice and comment process, which will include another hearing. The relevant deadlines for this process are as follows:
- 29 June 2018 – due date for filing requests to appear and a summary of expected testimony at the public hearing and for filing pre-hearing submissions.
- 23 July 2018 – due date for submission of written comments.
- 24 July 2018 – the Section 301 committee will convene a public hearing in the main hearing room of the US International Trade Commission (500 E Street SW, Washington, DC 20436) beginning at 9:30 am.
- 31 July 2018 – due date for submission of post-hearing rebuttal comments.
After the completion of this process, the USTR will issue a final determination on the products listed on the Tariff List 2 that will be subject to additional duties.
Product Exclusion Process Coming
Finally, USTR has indicated its intention to establish a process for interested parties to request specific product exclusions for products that are classified within an HTSUS subheading contained on List 1. This exclusion process appears to be focused on products 1) that are only available from China, 2) for which an imposition of additional duties would cause severe economic harm to a U.S. interest, and 3) that are not strategically important or related to the "Made in China 2015" program.
For further information on this topic please contact Teresa Polino, David R Hamill, David Salkeld or David Llorente at Arent Fox LLP by telephone (+1 202 857 6000) or email (t[email protected], david. [email protected], [email protected] or [email protected]). The Arent Fox LLP website can be accessed at www.arentfox.com.
Endnotes
(1) See 83 FR 28710. The notice can be found at www.federalregister.gov/documents/2018/06/20/2018-13248/notice-of-action-and-request-for-public-comment-concerning-proposed-determination-of-action-pursuant .
Aman Kakar and Leah Scarpelli, associates, assisted in the preparation of this update.
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