I want to file a 301 exclusion – what info do I need to provide the USTR?

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As you are aware, the exclusion process for List 3 is now openuntil September. We have received a lot of exclusion requests and I thought I’d share the information the US Trade Representative (USTR) requires in order to review an exclusion request:

1. 10-digit subheading of the HTSUS applicable, use 8/10 digits (if there are different HTSUS 8 and 10 digit codes used, we will need a separate request)

2. Product name

3. Detailed description of the product: (1) physical characteristics (e.g., dimensions, weight, material composition, etc.). (2) Requestors may submit a
range of comparable goods within the product definition set out in an exclusion request. Thus, a product request may include two or more goods with
similar product characteristics or attributes. Goods with different SKUs, model numbers, or sizes are not necessarily different products.

4. The products function, application (whether the product is designed to function in or with a particular machine or other device), principal use, and any
unique physical features that distinguish it from other products within the covered 8-digit HTSUS subheading. Requestors may submit attachments that
help distinguish the product (e.g., CBP rulings, photos and specification sheets, and previous import documentation). Documents submitted to support a
Requestor’s product description must be made available for public inspection and contain no BCI. USTR will not consider requests that identify the
product using criteria that cannot be made available for public inspection.

5. Requestors must provide their relationship to the product (Importer, U.S. Producer, Purchaser, Industry Association, Other) and provide specific data
on the annual quantity and value of the Chinese-origin product, domestic product, and third-country product the Requestor purchased, in 2017, 2018,
and the first quarter of 2019.

6. Requestors must provide information regarding their company’s gross revenues for 2018, the first quarter of 2018, and the first quarter of 2019.

7 For imports sold as final products, Requestors must provide the percentage of their total gross sales in 2018 that sales of the Chinese-origin product
accounted for.

8. For imports used in the production of final products, Requestors must provide the percentage of the total cost of producing the final product(s) the
Chinese-origin input accounts for and the percentage of their total gross sales in 2018 that sales of the final product(s) accounted for. Required
information regarding the Requestor’s purchases and gross sales and revenue is BCI and the information entered will not be publicly viewable.

9. Whether the particular product is available only from China and whether the particular product and/or a comparable product is available from sources
in the United States and/or in third countries. The Requestor must provide an explanation if the product is not available outside of China or the Requestor
is not sure of the product availability.

10. Whether the Requestor has attempted to source the product from the United States or third countries.

11. Whether the imposition of additional duties (since September 2018) on the particular product has or will cause severe economic harm to the
Requestor or other U.S. interests.

12. Whether the particular product is strategically important or related to “Made in China 2025” or other Chinese industrial programs.

If you have any questions about the exclusion request process, contact experienced attorney trade attorney David Hsu at 832-896-6288 or by email at dh@gjatradelaw.com.

Trump threatens tariffs on $300 billion of Chinese imports on September 1st.

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Official portrait of President Donald J. Trump, Friday, October 6, 2017. (Official White House photo by Shealah Craighead)

As you are aware, yesterday, President Trump imposed a September 1st deadline for an additional $300 billion in tariffs on Chinese goods if a trade deal is not reached.

The $300 billion covers the remaining items not previously listed in Lists 1, 2 or 3. The List 3 exclusion process is currently underway and Commerce recently published lists of additional exclusion requests that have been granted in Lists 1 and 2.

Here is a summary of what has been reported by various news outlets:

  1. There has been no progress in trade talks with China this week in Shanghai between Treasury Secretary Steven Mnuchin and US Trade Representative Robert Lighthizer and their Chinese counterparts.
  2. Trump believes China is moving too slow in working on a deal and set September 1st as a deadline to impose duties on the remaining imports of goods from China.
  3. The new duties if imposed in September will be at 10%. We have seen goods in List 1, 2, 3 have tariffs as high as 25%.
  4. Some news outlets report that China may be stalling to sign a trade deal until after the 2020 election.
  5. September 1st would mark an end to a “truce” between the two countries.
  6. China has threatened to respond with their own retaliatory tariffs if Trump goes through with the September 1st deadline.
  7. Trump claims China has not gone through with their promise to buy more agricultural products from the US in large quantities.
  8. Trump also claims China would curtail the shipments of Fentanyl to the United States, but has not and the shipments continue to harm Americans.
  9. According to reports, Chinese negotiators want Trump to remove the tariffs on $250 billion in Chinese goods before they will purchase US agricultural goods and comply with their other concessions.
  10. Trump believes the US economy is strong as unemployment has hit a 50-year low, a position that will enable the US to outlast China in the event of a prolonged trade war.
  11. Analysts claim further duties will only hurt Americans in increasing the prices of goods.
  12. Shipping companies and importers are trying to get as many shipments into the US prior to the September 1st deadline.

Will post more news as they become available. If you have any questions how the 301 duties will impact your business, contact David Hsu at: dh@gjatradelaw.com, attorney.dave@yahoo.com or by phone/text at 832-896-6288.

France to begin digital tax against Google, Amazon, Facebook, and Apple.

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While the Trump administration investigates Google and other tech companies for potential anti-trust violations here in the US, the Trump administration has threatened retaliatory tariffs against French imports if France implements a tax on digital activities.

The digital tax law was passed by the French Parliament on July 11th and to tax Google, Amazon, Facebook and Apple (known as the “GAFA” companies). The 3% tax on digital services would generate 400 million euros in 2019 and expected to generate 650 million by 2022.

In response, the US Trade Representative has begun an investigation against France for unfairly targeting US-based companies and is now open for public comment before a public hearing on August 19th.

We may see new tariffs on the over 36 billion in French imports into the US starting in August. If you import any items from France and want to know how you may be impacted, contact experienced trade attorney David Hsu at 832-896-6288 or by email at dh@gjatradelaw.com, attorney.dave@yahoo.com.

Apple shifts Mac Pro production to China, then asks to not pay tariffs on imported Mac Pros.

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The Mac Pro was the last Apple product manufactured in the US, and last June, Apple announced they would shift Mac Pro production to China.

On July 18th, Apple filed “exclusion requests” with the US Trade Representative to exclude certain items from the 25% 301 duties on goods imported from China.

The parts include a CPU, heat sink, power supplies, USB charging cables, circuit boards, graphics processing modules, computer enclosure, the Magic Mouse and Magic Trackpad.

To view Apple’s exclusion requests, go here: https://exclusions.ustr.gov/s/PublicDocket and search by “Organization Name” for “Apple”.

If you want to file an exclusion request, contact experienced trade attorney David Hsu at 832-896-6288 or by email at dh@gjatradelaw.com, attorney.dave@yahoo.com.

US/China trade talks amid new charges against Huawei.

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Earlier this week, Chinese Vice Premier Liu He and his trade team arrived in the US to begin negotiations with US Trade Representative Robert Lighthizer. At about the same time of Vice Premier Liu He’s arrival, the US Department of Justice announced charges against Huawei for violations of US sanctions against Iran and among other things, theft of US intellectual property from T-Mobile.

Negotiations are in progress to reach a deal that could prevent an additional 15% tariff (total 25%) on $200 billion worth of goods from China before the March 1st deadline.

Since the truce, China has increased their purchases of American exports, such as soy beans and have also taken steps to crackdown on intellectual property theft. However, the US government is also requesting China open its market and limit government direction for state-owned enterprises (SOE). A change to Beijing’s economic support of certain industries is likely something that will not change.

Check back for the latest news as it becomes available. If you have any export compliance questions or have concerns about compliance with US sanctions, contact trade attorney, David Hsu at 832-896-6288 or by email at attorney.dave@yahoo.com.

List 3 Exclusion Process?

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Last October, 10 10 senators sent a letter to the United States Trade Representative (USTR) inquiring why a List 3 exclusion process had not yet been established. As you are aware, an exclusion process allows importers or interested parties of goods subject to the Section 301 duties to petition to have their goods excluded from the tariffs of 10-25%.

Earlier this week, the USTR replied indicating an exclusion process will not start on List 3 unless negotiations fail with China and the tariffs are raised on the $200 billion worth of goods from 10 to 25%. Both China and the US have agreed to a “truce” until March 2, 2019.

Will update as soon as any updates are available. If you have any trade, import, export, trade or compliance attorneys, contact experienced trade attorney David Hsu at 832-896-6288 or by email at attorney.dave@yahoo.com

Tesla applies for tariff exclusion.

According to Reuters, Tesla has applied for a tariff exemption for the Chinese made computer brain found in the Model 3.

While not mentioned in the Reuters article, the computer component is currently included under List 2 of the Section 301 duties that came into effect in August of last year.

All goods under List 2 have a duty of 25%.

Tesla’s filing did not specify the Chinese manufacturer and included language mentioning China as the only source of this product that could meet the required specifications and volume.

It will be interesting to see whether this exclusion request is approved as very few of the tens of thousands have been approved. I’ll definitely updated this if and when it is approved.

The time to apply for a tariff exclusion under List 2 has passed and there are currently no instructions for a tariff exclusion request for goods covered under List 3.

Feel free to contact me if you have any questions how these 301 tariffs will impact you and your interests. My cell is 832.896.6288 or email me at attorney.dave@yahoo.com.

Midlevel US-China trade talks end – higher-level talks next?

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According to the New York Times, the midlevel US trade negotiators and their Chinese counterparts concluded trade talks today (Wednesday, January 10th).

No new concerns were mentioned in the NYT article. The US is still concerned about China’s purchase of US agricultural, energy and manufacturing products; forced technology transfer; intellectual property protection and concerns regarding China’s 2025 initiative.

The next step is to report the results of their talks to President Trump. As you are aware, the imposition of List 3 tariff increases to 25% (from the current 10%) occurs on March 1st (a 90-day extension announced during the “truce” at the G-20 summit in December 2018).

If you have any questions on how the Section 232 or Section 301 duties on Chinese imports impact your business, contact experienced trade and customs attorney David Hsu at attorney.dave@yahoo.com or by phone/cell/text: 832-896-6288.

Key 2019 Trade Deadlines.

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Happy new year everyone! Hope your new year is off to a great start.

2018 was a busy year for trade policy and 2019 will likely continue that trend. Here’s some important dates for trade in this new year:

1/1/2019 – the updated US trade agreement with South Korea signed in September 2018 will enter into force.

1/7/2019 – during this week, a US delegation will travel to Beijing for trade talks with Chinese officials. This will be the first face to face meeting since President Trump met with President Xi Jinping at the G20 summit on December 1st.

1/7/2019 – while a delegation goes to Beijing, the EU Trade Commissioner will meet with USTR Robert Lighthizer on other trade negotiations with the EU.

1/10/2019 – this is the deadline for submission of comments by US businesses regarding restrictions on high-tech American exports such as microprocessors and robotics

1/21/2019 – the US and Japan will likely enter into formal talks for a trade agreement.

2/17/2019 – deadline for the U.S. Department of Commerce to publish their report on the justification of tariffs on foreign cars. Once a report is submitted, President Trump has 3 months (May 18th) to make a decision on tariffs for foreign cars.

3/1/2019 – end of the 90-day truce started on December 1st. If no trade agreement is reached, $200 billion of Chinese goods will see increased tariffs from 10% to 25%.

4/2019 – deadline for the U.S. Department of Commerce to publish a national-secuirty report on the impact of uranium imports.

1st half of 2019 – congress will vote on the U.S.-Mexico-Canada Agreement to replace NAFTA.

Check back for more updates as they become available. If you have any questions how these upcoming events will impact your business, contact experienced trade attorney David Hsu at 832-896-6288 or by email at attorney.dave@yahoo.com.

China set to resume importing oil from the US.

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According to the Financial Tribune, the trading arm of China’s Sinopec and largest buyer of US crude oil – Unipec, will resume purchase of US crude oil very soon at a significant volume.

Unipec has not imported US crude oil in August or September of this year. However, since the “truce” in the US and China trade war in early December where both sides agreed to suspend raising tariffs for an additional 90 days, Chinese refiners have started to look to the US for crude oil.