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Section 301 tariffs

Section 301 Tariffs are levied under the Trade Act of 1974 which grants the Office of the United States Trade Representative (USTR) authority to investigate and take action to protect U.S. rights from trade agreements and respond to foreign trade practices. Section 301 of the Trade Act of 1974 provides statutory means allowing the United States to impose sanctions on foreign countries violating U.S. trade agreements or engaging in acts that are “unjustifiable” or “unreasonable” and burdensome to U.S. commerce. Prior to 1995, the U.S. frequently used Section 301 to eliminate trade barriers and pressure other countries to open markets to U.S. goods.

The founding of the World Trade Organization in 1995 created an enforceable dispute settlement mechanism, reducing U.S. use of Section 301. The Trump administration began using Section 301 in 2018 to unilaterally enforce tariffs on countries and industries it deemed unfair to U.S. industries. The Trump administration adopted the policy shift to close what it deemed a persistent "trade gap" between the U.S. and foreign governments that it said disadvantaged U.S. firms. Additionally, it pointed to alleged weaknesses in the WTO trade dispute settlement process to justify many of its tariff actions -- particularly against China. The administration also cited failures in previous trade agreements to enhance foreign market access for U.S. firms and workers.

The Trump Administration launched a Section 301 investigation into Chinese trade policies in August 2017. Following the investigation, President Trump ordered the USTR to take five tariff actions between 2018 and 2019. Subsequent rounds of Section 301 actions against China have continued since. The Office of the U.S. Trade Representative administers Section 301 tariffs, and has also created an exclusion process for importers to seek exemptions from the tariffs.

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Trade Analyst Doesn't Expect Much Difference in Biden's Trade Policy Post-Midterms
November 17, 2022 |Other U.S.

Simon Lester, president of China Trade Monitor and WorldTradeLaw.net, said he doesn't expect any large changes in the Biden administration's trade policy following the midterm elections. In a blog post Nov. 15, Lester wrote that while the administration could look at the election results as not provoking too much of a backlash to its trade policy, it's more likely that the election cycle was favorable to Democrats, due to the Supreme Court's Dobbs decision and "terrible" GOP candidates.

US-China Commission Recommends Congress Withdraw PNTR for China
November 15, 2022 by Mara Lee|Other U.S.

The U.S.-China Economic and Security Review Commission said that if China has not complied with its World Trade Organization accession provisions, Congress should pass a law "to immediately suspend China’s Permanent Normal Trade Relations" treatment, which would mean that Chinese imports would face higher base tariffs than from nearly all other countries. Then Congress should assess what conditions it would require to renew Chinese imports' eligibility for Most Favored Nation Tariffs, the commission said in its annual report, released Nov. 15.

Topics:Customs duty, World Trade Organization (WTO), Permanent normal trade relations (PNTR) , Forced Labor
Chief Lobbyist at Flexport Predicts Customs Modernization Will Pass by 2025
November 15, 2022 by Mara Lee|Top News

Of all the outstanding trade policy options -- new trade promotion authority, requiring Section 301 exclusions, revisions to antidumping law and a customs modernization law -- the head of government relations at Flexport said he thinks customs modernization is the most likely to pass. "I think we are coming on the cusp of something," Darien Flowers said, and said he thinks a bill will be enacted before 2025. Flowers once worked for Sen. Bill Cassidy, the Louisiana Republican who is leading the bill, though more recently he served on the minority staff of the Senate Commerce Committee.

Topics:Generalized System of Preferences (GSP)
USFIA Officials Expect Minor Adjustments on CAFTA, GSP/MTB Renewal
November 14, 2022 by Mara Lee|Top News

NEW YORK -- At the U.S. Fashion Industry Association trade conference, the group's Washington counsel said that he believes there's a high likelihood that the Generalized System of Preferences benefits program and the Miscellaneous Tariff Bill will be passed before Congress goes home in December. USFIA President Julia Hughes added that because some of the members who are retiring are pro-trade, and they recognize that sentiment is waning in Congress, "that's gonna be an impetus to do something during the lame duck. Whether they're successful or not, that's not clear yet."

Topics:Generalized System of Preferences (GSP), African Growth and Opportunity Act (AGOA), Forced Labor