Tag: section 301

President Trump signs proclamation imposing tariffs on imported steel and aluminum

Exclusion requests for Sec 232 and 301 tariffs

New Tariffs: Steel, Aluminum, China

President Trump has announced new tariffs this year imposed on imports from various countries under two bases; first, he imposed a 25% steel tariff and 10% aluminum tariff under section 232 of the Trade Expansion Act of 1962. This section allows the President to impose tariffs for national security reasons (the full reports and reasoning are available here).

Second, President Trump announced a 25% tariff against imports from China under section 301 of the Trade Act of 1974 (full announcement here) covering $34 billion worth of goods. The Chinese tariffs are designed to punish, or at least counter-act, unfair trade practices related to technology transfer, intellectual property, and innovation by China. Subsequently, President Trump expanded section 301 tarriffs to include another $216 billion worth of goods.

To date, $50 billion worth of goods has been finalized, with the remaining $200 billion to be dealt with by the end of the week (September 7, 2018).

The USTR has published a helpful summary of the status of all Section 301 tariffs, and their current status HERE.

To date, the fact that these tariffs might only end-up hurting domestic industries is getting a lot of attention (there is a lot of tariff activity). There seems to be little awareness or recognition — both amongst importers and the news community as a whole — that there is very large loophole in both new tariffs: exclusions.

Exclusion Requests

The section 232 tariffs on steel and aluminum permit importers to request exclusions from certain products, on certain grounds. Initially, the official announcements and proclamations seemed to only permit exclusion requests on national security grounds, however, once the exclusion request form (steel) was published it seemed to permit exclusion requests to be filed for basically any reason (including insufficient U.S. availability, No U.S. Production, and “Other”).

The section 301 tariffs for the first set of products (the $34 billion action) permit importers to request an exclusion which are due by October 9. As of now, exclusions for the $16 billion action will be available, but the procedure has not yet been announced.

Currently, no exclusion requests for the 232 or 301 tariffs have been granted (despite some indications from the Bureau of Industry and Security that some were granted for some of our clients).

Importers may be in a panic about the new tariffs; they should not. They should calmly consider requesting exclusions for the products so that the new tariffs will not apply to them, and they will not be required to pay the extra duties. Although the exclusion process can be done by anyone, as always, hiring an experienced attorney to advocate for the exclusion of the particular products will help to ensure the best result possible.

Want to discuss a possible section 232 or 301 exclusion?

If you’re interested in applying for an exclusion for section 232 or 301 tariffs, you can give us a call or complete the contact form below.

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