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President Trump Asks USTR to Consider a Tariff Increase From 10 percent to 25 percent on $200 Billion of Chinese Products

On August 1, 2018, the U.S. Trade Representative (USTR) announced a potential increase to the proposed Section 301 tariff for the $200 Billion of Chinese products previously identified on July 10, 2018 (“List 3”). As discussed in our prior client alert, President Trump had initially directed USTR to identify $200 billion of additional Chinese imported goods that would be subject to 10 percent retaliatory tariffs. President Trump then directed USTR to “consider increasing the proposed level of the additional duty from 10 percent to 25 percent,” and yesterday’s action by USTR follows that directive. This continues the Trump administration’s remedies pursuant to USTR’s Section 301 investigation regarding “China’s acts, policies and practices related to technology transfer, intellectual property, and innovation” that were determined to be “unreasonable and discriminatory, and a burden to U.S. commerce.”

Due to this proposed increase from 10 percent to 25 percent, the purpose of the investigation is now two-fold: (1) to determine which products should be included or excluded from List 3, and (2) to determine whether the tariffs for List 3 products should remain at 10 percent or be increased to 25 percent.

In light of this change to the scope of the investigation, USTR has modified certain deadlines for the notice and comment period to accommodate parties that now would like to participate in the hearing process. All relevant dates, including the new deadlines for submitting a request to participate in the public hearing and for submitting post-hearing comments, are below:

Event

Previous Schedule

Revised Schedule

Hearing Request

July 27, 2018

August 13, 3018

Written Testimony

Not Announced

August 9, 2018*

Pre-hearing Comments

August 17, 2018

August 17, 2018

Hearing Dates

August 20-23, 2018

August 20-23, 2018

Post-Hearing Rebuttal Comments

August 30, 2018

September 5, 2018 

*For interested parties that have already filed a request to participate in the public hearing.

As noted above, in order to appear at the August 20–23 public hearing, a party must submit its request to appear by August 13. Such a request must include a summary of the testimony and may be accompanied by a pre-hearing submission. The remarks at the hearing may be no longer than five minutes.

Given the potential increase in the tariff rate for List 3 products, companies that originally decided not to participate in this round may want to reconsider. As the dates detailed above are fast approaching, it is important that companies organize quickly to submit comments and to prepare for the USTR hearing.

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About this Author

Nate Bolin, Drinker Biddle Law Firm, Washington DC, Litigation Law Attorney
Partner

Nate Bolin has significant experience advising clients in compliance, transactional, litigation, policy and regulatory matters involving U.S. export controls, U.S. International Traffic in Arms Regulations (ITAR), economic sanctions, and related areas of national security and international trade law.

In corporate transactions and mergers and acquisitions, Nate regularly advises buyers, sellers and investors on the impact of U.S. export controls, customs laws, trade remedy laws, existing bilateral and multilateral trade...

(202) 230-5888
Douglass Heffner, International trade lawyer, Drinker Biddle
Partner

Douglas J. Heffner litigates customs and international trade matters including antidumping duty, countervailing duty and safeguard cases. He represents foreign companies in Canada, Europe, Japan and Mexico, as well as domestic producers in industries that range from high-tech to heavy industry, to consumer and industrial goods. He also represents trade associations, government agencies and embassies in a broad range of matters.

202-230-5802
Kathleen Murphy, International trade Lawyer, Drinker Biddle
Partner

Kathleen M. Murphy counsels clients on maximizing trade benefits, making informed global procurement decisions and developing domestic and international trade compliance programs. She represents clients in duty-recovery initiatives and customs challenges concerning tariff classification, valuation, Free Trade Agreements and country of origin determinations, among other areas. She guides clients through compliance audits and validations, as well as penalty investigations conducted by U.S. or foreign customs authorities. She also represents clients in...

312-569-1155
James Sawyer, Drinker Biddle Law Firm, Chicago, Trade Law Attorney
Partner

James L. Sawyer counsels clients in all areas of U.S. import laws and regulations, including tariff classification, valuation, origin determination and marking, Free Trade Agreements, and duty preference programs. He chairs the firm’s Customs and International Trade Team and is the Regional Partner in Charge of the firm's Chicago office.

James represents clients in enforcement proceedings and investigations, Focused Assessment audits, and other verification proceedings conducted by U.S. Customs and Border Protection (CBP). He frequently assists clients craft...

312-569-1156
Luke Karamyali, Drinker Biddle Law Firm, Chicago, International Trade Law Attorney
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Luke J. Karamyalil assists his clients in all aspects of international trade laws and regulations, including import and export compliance. He also assists clients in ensuring their internal processes meet Customs’ “reasonable care” standard. Luke has experience helping clients navigate specific trade laws and regulations, including those that arise under the Foreign Agents Registration Act, the Trade Adjustment Assistance Program, anti-boycott compliance, Foreign Ownership, Control, or Influence (FOCI) mitigation, and anti-dumping and countervailing duties.

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