Section 232 Tariffs

International Trade Today is providing readers with some of the top stories for March 12-16 in case they were missed.

House of Representatives appropriators want to know whether the Commerce Department will be able to make prompt determinations on steel and aluminum tariff product exemptions if the agency receives 4,500 applications, as it projected. The Appropriations subcommittee that handles Commerce's budget heard from Secretary Wilbur Ross on March 20. Ross said that the fiscal year 2019 budget request does ask for more staffing. "We believe we can handle the influx," he said.

CBP is likely to quickly focus on misclassification and valuation as enforcement issues involving the coming tariffs on steel and aluminum as a result of the politics and revenue involved, said Michael Roll, a lawyer at Pisani & Roll. Roll discussed the new tariffs during a webinar hosted by the Los Angeles Customs Brokers & Freight Forwarders Association of America. "That doesn't mean that they are going to jump out the gate on March 24 hitting people with penalties necessarily," but there will be a focus on "enforcement, enforcement and more enforcement," Roll said.

Product-specific exemptions from new Section 232 tariffs on aluminum and steel products will only apply to the individual or organization requesting the exemption, though additional individuals may file separate requests to obtain the same exemption, according to the Bureau of Industry and Security’s March 19 interim final rule setting procedures for exemption requests and opening up the application period (see 1803160067). BIS will normally decide whether to issue an exemption within 90 days of the request, and exemptions will remain in effect for a year, the agency said.

The European Commission is seeking input from private parties on how an increase in customs duties on products from the U.S. in response to the Section 232 tariffs on steel and aluminum from the EU would affect Europeans, it said in a notice. The EC is considering "suspension of tariff concessions under Article 8 of the [World Trade Organization] Agreement on Safeguards" and "imposition of increased customs duties on certain products," it said. "The Commission's intention is to ensure that applied additional customs duties are set at the appropriate level taking into account future developments," such as an exemption for the EU, it said.

CBP plans to provide more information about its implementation of the new Section 232 tariffs on aluminum and steel, an agency spokesman said. "CBP will issue a message via the Cargo Systems Messaging Service (CSMS) in the next few days with the entry filing requirements for the Section 232 duties," he said. The recently released annexes to the Presidential Proclamations include language allowing CBP to require additional information from importers necessary for the agency to administer the new tariff provisions, as well as any exemptions granted by the Commerce Department. (see 1803140030).

The Commerce Department Bureau of Industry and Security released a notice late on March 16 that outlines the requirements for submissions requesting exclusions to the Section 232 tariffs on steel and aluminum. "The process established in this interim final rule is limited to the issuance of product-based exclusions as authorized by the President," BIS said. "Consistent with the President’s instructions, the criteria in the forms and supplements are primarily focused on the availability of the product in the United States. The Secretary will consider information about supply in other countries to the extent relevant to determining whether specific national security considerations warrant an exclusion. Commenters on this interim final rule may submit comments regarding how and whether or not the country of origin of a proposed product should be considered by Commerce as part of the process for reviewing product-based exclusion requests." This process is "separate and apart from the process by which countries may seek exemptions from the duties imposed by the President," the agency said.

The House Ways and Means Committee has scheduled two hearings for next week to hear from top trade officials from the Trump administration. U.S. Trade Representative Robert Lighthizer will testify at a hearing on the trade policy agenda on March 21, the committee said in a press release. Commerce Secretary Wilbur Ross is scheduled to testify on March 22 about recent trade actions, including the Section 232 tariffs on steel and aluminum, the committee said in another release.

European Commission officials said during March 14 speeches that the EU deserves to be exempt from new tariffs on steel and aluminum. "We expect that the EU as a whole will be excluded as a key political, security and economic partner that trades fairly with the US," said European Commission Vice-President for Jobs, Growth, Investment and Competitiveness Jyrki Katainen during the European Parliament plenary debate. The EU will continue work to resolve the overcapacity issue and, in the meantime, "we sincerely hope that the process of exclusion on EU steel and [aluminum] exports from the scope of U.S. measures will be expedited, transparent and smooth," he said. "We believe that our exports do not cause any threat to U.S. security."

The path forward for Miscellaneous Tariff Bill and Generalized System of Preferences renewals remains uncertain despite some hope that both could be part of the omnibus funding bill that has to pass before March 23. House Ways and Means Committee Chairman Kevin Brady, R-Texas, said nothing concrete on whether on the bills will pass this month. "I'd like to see action on both of those, because there's such bipartisan support here in the House," he said when asked if they will be part of the omnibus.