[September 18, 2018]

Earlier today, the USTR published a Notice and Request for Comments in the Federal Register with respect to the product specific exclusion request process for the Section 301 tariffs that went into effect on August 23, 2018. Interested persons may submit exclusion requests to the USTR until December 18, 2018.

Per the Notice, requests for exclusion from the List 2 tariffs must contain the following information:

  • A detailed description of the product in terms of its physical characteristics (e.g., dimension, material composition or other characteristics) that distinguish it from other products;
  • The ten-digit HTSUS subheading that is applicable to the product;
  • A statement as to the ability of U.S. Customs and Border Protection to administer the exclusion;
  • The annual quantity and value of the Chinese-origin product that the requester purchased in the last three (3) years—estimates may be provided if precise data is not available;
  • For imports that the requester sold as final products, the percentage of the requester’s total gross sales in 2017 that the sales of the Chinese-origin product accounted for;
  • For imports used in the production of final products by the requester, the percentage of the total cost of producing the final products which utilized the Chinese-origin inputs and the percentage of the requester’s total gross sales in 2017;
  • Whether the product is available only from China or whether the product or a comparable product is available from sources in the US and/or in third countries;
  • Whether the imposition of additional duties on the product would cause severe economic harm to the requester or other US interests;
  • Whether the product is strategically important or related to “made in China 2025” or other Chinese industrial programs; and,
  • Any other information or data that they consider relevant to an evaluation of the request.

The USTR has prepared a request form that may be used by requesters; however, use of the form is not required. The request form will be posted on the USTR’s website under “Enforcement/Section 301 Investigations” of docket number USTR-2018-0032 of www.regulations.gov. If the request contains business confidential information, it must be accompanied by a public version.

The USTR will evaluate each request on a case-by-case basis taking into account whether the exclusion would undermine the objectives of the Section 301 investigation.

Responses to exclusion requests must be submitted within 14 days after the request is posted. Replies to responses to exclusion requests are then due the later of 7 days after the close of the 14-day period or 7 days after the posting of a response.

Exclusions that are approved by the USTR will have retroactive effect back to August 23, 2018 and going forward will be valid for a period of one (1) year after the publication of the exclusion decision published in the Federal Register.

For further information, see: https://www.federalregister.gov/documents/2018/09/18/2018-20246/procedures-to-consider-requests-for-exclusion-of-particular-products-from-the-additional-action

If you have any questions pertaining to the increased tariffs under Section 301 or other international trade issues, please contact Melissa Proctor (melissa@millerproctorlaw.com) or Peggy Chaplin Louie (peggy@millerproctorlaw.com) at Miller Proctor Law PLLC (melissa@millerproctorlaw.com).