Input Stories

The Trump administration announced sweeping Section 301 investigations last week that could impact more than 60 countries (Reuters, subscription). The investigations are required before the administration can impose new tariffs under Section 301.

The timeline: The administration may target the 150-day expiration of the Section 122 tariffs imposed in February as its preferred start date for new Section 301 tariffs. However, the timing will remain undecided while the investigations are underway. 
 
Structural excess capacity and production: USTR’s Section 301 investigation into “excess capacity” targets policies and practices that lead to overproduction, large or persistent trade surpluses, and underutilized and unused manufacturing capacity.

• Policies identified include subsidies, state-owned enterprises, suppressed wages and poor labor protections, market access barriers, subsidized lending and currency manipulation.
• Sixteen U.S. trading partners are under investigation: China, the EU (specifically Germany and Ireland), Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, South Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan and India.

Forced labor: In addition, USTR is investigating 60 economies to determine whether they have “failed to impose and effectively enforce a ban on the importation of goods produced with forced labor.”

• The list of countries includes Argentina, Australia, Brazil, Canada, Chile, China, the EU, India, Japan, Mexico, Norway, Singapore, South Korea, Switzerland, Taiwan, the U.K. and Vietnam.

In other tariff news… Customs and Border Protection has filed a status report with the Court of International Trade on the administration’s progress toward developing an automated system to administer International Emergency Economic Powers Act refunds. 

• The CIT ordered CBP to issue “immediate” refunds but suspended that order while CBP builds a new system to handle the high volume of complex refund calculations.
• As CBP detailed in its initial filing, the system would include a portal to file refund claims, the recalculation of duties owed, the liquidation/reliquidation of tariff entries and refunds (with interest) consolidated by date and importer of record. 

Back in the courts: Lastly, a lawsuit was filed earlier this week challenging the president’s 10% worldwide Section 122 tariffs.

• The case is still in the earliest stages of the litigation process. The plaintiffs argue that the U.S. trade deficit the president is using to justify the tariffs is not the same thing as a “balance-of-payments” deficit described in Section 122—and thus the tariffs are unlawful. The NAM is not involved in this case.