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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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Importer Scraps Customs Suit on Whether Pet ID Tags Excluded From Section 301 Duties
February 1, 2024 by Jacob Kopnick|Litigation

Importer MCM Technologies on Jan. 30 dismissed its suit challenging CBP's denial of its protest regarding the classification of its pet identification tags. The importer said the tags, which are classified under Harmonized Tariff Schedule subheading 8302.49.4000, qualify for an exclusion from Section 301 tariffs under secondary subheading 9903.88.4800. Counsel for MCM Technologies declined to comment (MCM Technologies v. U.S., CIT # 22-00005).

Topics:Harmonized Tariff Schedule, Section 301 tariffs
CAFC Issues Mandate After Order Requiring Protest for Retroactive Section 301 Duty Exclusions
January 23, 2024 by Jacob Kopnick|Litigation

The U.S. Court of Appeals for the Federal Circuit on Jan. 22 issued its mandate in a pair of cases seeking to retroactively apply Section 301 tariff exclusions. In the suits, the appellate court sustained the dismissal of the cases for a lack of subject matter jurisdiction, finding that a protest must have been filed with CBP to properly effectuate relief. The Court of International Trade initially said jurisdiction was not to be had under Section 1581(i), the court's "residual" jurisdiction, since the court would have had jurisdiction under Section 1581(a) had a protest been filed (see 2209060035). The Federal Circuit affirmed, finding that the true nature of the suits contests CBP's assessment of the duties and not the U.S. Trade Representative's decision to grant an exclusion, even though the exclusions were granted after the deadline for filing a protest had lapsed (ARP Materials v. United States, Fed. Cir. # 21-2176) (The Harrison Steel Castings Co. v. United States, Fed. Cir. # 21-2177).

Topics:Court of International Trade activity, Section 301 tariffs