Requesting Product Exclusions under Section 301 Duties
The first round (or “tranche”) of 25% punitive duties on Chinese-origin goods went into effect at midnight on July 6, 2018. The Office of the United States Trade Representative (USTR) issued the additional tariff under Section 301 of the Trade Act of 1974, as amended, as part of the U.S. response to China’s unfair trade practices related to the forced transfer of American technology and intellectual property. The initial set of duties targets approximately $34 billion of imports of Chinese-origin goods and contains over 500 subheadings of the Harmonized Tariff Schedule of the United States (HTSUS).
Effective at midnight on August 23, 2018, an additional $16 billion of imported Chinese-origin goods were targeted for Section 301 duties. Nearly 300 additional HTSUS subheadings appear on “List 2,” which was carved out of the initially announced “List 1.”
When List 1 became effective, USTR published a formal notice in the Federal Register announcing a procedure for “interested persons” to request the exclusion of particular products covered by a classification subheading subject to the punitive Section 301 duties. As of this writing, nearly 1,000 requests have been filed with USTR. Although, the Federal Register notice for requesting product exclusions for subheadings on List 2 has not been published as of this writing, USTR has stated that the exclusion process will apply to products covered by List 2 subheadings.
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