What should my company do regarding the Section 232 and Section 301 tariffs?

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We are fielding a lot of calls from importers, vendors, manufacturers, brokers and freight forwarders about what to do now that the Section 232 and Section 301 tariffs are in place.

We suggest:

  1. Review the list of products to determine your company’s exposure to Section 301 and Section 232 tariffs. The First Section 301 list can be found here.
  2. If there is a product on the second list of the Section 301 tariffs, you should participate in the comment process. The second list can be found here.
  3. If you are importing a product covered under Section 301 or Section 232, look into other alternatives for sourcing.
  4. This may be a good time to review your imported and exported goods and the classification used.
  5. Notify your customers, suppliers, vendors, buyers of potential price impacts of these new tariffs.
  6. Review pending purchase orders and pending shipments with companies in China, Canada, Mexico and the European Union.

If you have any questions about Section 232 or Section 301, contact experienced trade attorney David Hsu at 832-896-6288 or by email at dhsu@givensjohnston.com. We also assist in filing exclusion requests and submission of comments, call or email now for immediate assistance.

Breaking news – Section 301 Statement by US Trade Rep. Robert Lighthizer and list of Chinese goods impacted by $200 billion in tariffs.

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Robert Lighthizer, official portrait, work of the U.S. Federal Government

U.S. Trade Representative (USTR) Robert Lighthizer released a statement today regarding Section 301 of the Trade Act.

The full statement can be read here.

Here’s a summary of the statement:
1. Last Friday, US started imposing tariffs of 25% on $34 billion worth of Chinese imports.
2. Will eventually cover $50 billion in Chinese imports.
3. Tariffs are against products that benefit from China’s industrial policy and forced technology transfer practices.
4. China retaliated with $34 billion in tariffs and threats on $16 billion more.
5. In resopnse to China’s retaliation, President Trump ordered tariffs of 10% on an additional $200 billion in Chinese imports.

Brief history of the 301 tariffs:
1. Last August (2017), President Trump asked USTR to begin the Section 301 process. The basis of the 301 was due to China’s”abusive trading practices with regard to intellectual property and innovation.”
2. USTR conducted investigation, published 200 page report showing: “China has been engaging in industrial policy which has resulted in the transfer and theft of intellectual property and technology to the detriment of our economy and the future of our workers and businesses. ”
3. The USTR also found these “practices are an existential threat to America’s most critical comparative advantage and the future of our economy: our intellectual property and technology.”

To view the Federal Register notice and list of proposed tariffs on $200 billion of Chinese imports, click here.

If you have any questions how these 301 tariffs may impact your business, or if you would like to submit comments to the US Government, please contact experienced trade attorney David Hsu at 832-896-6288 or by email at dhsu@givensjohnston.com.

Tesla raises car prices in China amid potential US/China trade war.

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Reuters is reporting the price of Model S and Model X Tesla vehicles have increased by over $20,000 in China. Reuters cites the website Electrek’s report on Monday.

China already raised tariffs on U.S. car imports in response to President Trump’s move on imposing tariffs on $34 billion worth of Chinese goods.

The raise in prices in China come after a decrease in prices as recently as this past May – when Model X vehicles were discounted $14,000. Electrek reports that 17% of Tesla’s 2017 revenue was from China sales and that Tesla estimates shipping 15,000 cars a year to China.

 

Trump proposes further tariffs on $200 billion worth of Chinese goods.

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Official Portrait of Ambassador Robert E. Lighthizer

US Trade Representative (USTR), Robert Lighthizer released a statement supporting Trump’s request for the USTR to identify $200 billion worth of Chinese goods for an additional 10% in tariffs.

This follows Trump’s announcement last Friday of a 25% tariff on $50 billion in Chinese goods to counter what Trump claims to be “China’s theft of intellectual property and technology and its other unfair trade practices”.

Lighthizer’s full statement reads:

“I support the President’s action. The initial tariffs that the President asked us to put in place were proportionate and responsive to forced technology transfer and intellectual property theft by the Chinese. It is very unfortunate that instead of eliminating these unfair trading practices China said that it intends to impose unjustified tariffs targeting U.S. workers, farmers, ranchers, and businesses. At the President’s direction, USTR is preparing the proposed tariffs to offset China’s action.”

Call David Hsu if you have any questions on how US and Chinese tariffs may impact your business, 832-896-6288 or mail at dhsu@givensjohnston.com.

White House imposes tariffs on $50 billion of Chinese goods.

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As expected, the administration announced Section 301 tariffs on about $50 billion worth of Chinese goods with two purposes: (1) balance the trade relationship between the US and China and (2) prevent the transfer of American technology and intellectual property to China when US businesses operate in China.

After the announcement this morning, China responded by issuing their own tariffs on 659 types of goods from the US starting on July 6th. When announcing the initial $50 billion in tariffs, Trump also indicated any Chinese retalation will also be met with additional US tariffs.

Cliff Notes version of today’s developments:

  1. 2/3rds of the US duties on 1,102 types of goods begins July 6th.
  2. The goods announced on Friday will apply later after a review period ends.
  3. The US imposed these tariffs to limit the transfer of technology to China.
  4. Some lawmakers say these tariffs will only impact the average American due to higher prices.
  5. The first list of goods subject to tariffs can be found here.
  6. The second list of goods subject to tariffs can be found here:

Whether or not these announcements are posturing on both sides, check back for more details.

If you have any questions on how these new tariffs will impact your import or export business, contact experienced trade attorney, David Hsu at 832-896-6288 or by email at: dhsu@givensjohnston.com.

 

U.S. Commerce Secretary in China for trade talks.

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According to an Associated Press article from June 1st, U.S. Commerce Secretary Wilbur Ross arrived in Beijing on Saturday for talks on China’s promise to buy more American goods.

The talks are about China’s May 19th announcement to narrow the trade surplus with the US, which reached a record high of $375 billion USD last year. China previously indicated they would increase purchase of farm goods, energy and other goods and services.

Additionally, the US may not get the commitment it seeks in reducing the trade deficit as China’s “Made in China 2025” plan seeks to establish China as an industry leader in high tech industries such as robotics, computer chips and electric vehicles.

A resolution may not occur with just one meeting as Trump has threatened tariffs on $100 billion of Chinese goods and China threatening retaliatory tariffs on $50 billion of US goods.

Check back for the latest news of the results of the Secretary Ross meeting.

If you have any questions about current antidumping or countervailing duty actions on goods from China – feel free to call experienced trade attorney, David Hsu at 832-896-6288 or by email at dhsu@givensjohnston.com.

US and China agree to end trade war.

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According to aMay 19th article from the Agence France-Presse (AFP), China’s Vice-Premier Liu He announced the US and China “reached a consensus, will not fight a trade war, and will stop increasing tariffs on each other”. The AFP article cited Chinese state media for their article and here is the Cliffs Notes version:

1. Both the US and China will stop increasing tariffs against each other.
2. China agreed to increase purchases of US goods and services.
3. Joint statement did not address reducing the trade deficit with China.
4. New trade cooperation to medical care, high tech products and finance.
5. Each part will cooperate on protecting intellectual property rights

Will update as more news becomes available.

Trump delays decision on steel and aluminium tariffs.

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A little background – back in March 2018, President Trump imposed worldwide tariffs of 25% on imports of steel and 10% on aluminum. Countries such as Canada, Mexico and the European Union were temporarily exempted from these tariffs.

Later in April, the US gave South Korea a permanent exemption from these tariffs in exchange for a 30% reduction of SK exports of steel to the United States.

One country not exempted was China, and as posted previously on this blog, China retaliated with their own duties on many US imports to the middle kingdom.

Fast forward to May 1st and the current administration has extended negotiations on steel and aluminium tariffs for an additional 30 days with Canada, Mexico and the European Union. Tentative agreements have been reached with Argentina, Brazil and Australia.

Check back here for more details as they become available.

US Treasury Secretary Mnunchin may travel to Beijing for trade talks.

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77th United States Treasury Secretary, Steven Mnuchin

Earlier this week, current US Treasury Secretary Steven Mnuchin told reporters he may travel to Beijing for trade negotiations to ease U.S.-China tensions.

In recent weeks both countries have announced tariffs on goods imported from the other country and the tensions between the US and China (the world’s two largest trading partners) has raised concerns of an impending trade war. The US first proposed tariffs totaling $150 billion on Chinese imports and Beijing has proposed tariffs on American goods such as soybeans.

In response, the Ministry of Commerce, People’s Republic of China would “welcome” the move by Treasury Secretary Mnuchin.

More updates as they become available.

EU wants to participate in the US-China steel dispute at the WTO.

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As previously posted on this blog, China requested consultations with the WTO regarding the US import tariffs on steel and aluminum. Requesting a consultation with the WTO is the first stage in the dispute process with the WTO and now the EU asked on April 23rd to join the dispute.

It is important to note that one week from now, President Trump will decide whether these tariffs would apply to imports from the EU. A temporary exemption from the 25% duty on steel and 10% duty on aluminum was granted for the EU until May 1st. Temporary exemptions were also granted to Canada, Mexico, Australia, Argentina and Brazil. South Korean imports have been exempted indefinitely.

In addition to the EU, Hong Kong, Russia, India and Thailand have also filed requests to join the consultations. Check back for more information as it becomes available.