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U.S. product exclusions, imports from China

U.S. product exclusions, imports from China

The Office of the U.S. Trade Representative (USTR) today released for publication in the Federal Register a notice announcing its determination to grant certain exclusion requests (listed in an annex to the notice) and to correct certain technical errors in previously announced exclusions as part of the action in the Section 301 investigation of China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation.

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Read today’s USTR notice [PDF 1.05 MB] (14 pages as published in the Federal Register) that includes a list of product exclusions in an annex. These product exclusions will apply as of September 24, 2019 (the effective date of the $200 billion action) to August 7, 2020.

Today’s notice is one in a series of previously granted exclusions announced by the USTR in September, October, November, and December 2019 and most recently in January 2020. Read TradeNewsFlash


Background

The USTR, beginning in September 2018, imposed additional 10% customs duties on goods of China classified in 5,757 full and partial subheadings of the Harmonized Tariff Schedule of the United States (HTSUS), with an approximate annual trade value of $200 billion. In May 2019, the USTR increased the additional duty to 25%. In June 2019, the USTR established a process by which U.S. stakeholders can request exclusion of particular products classified within an eight-digit HTSUS subheading covered by the $200 billion action from the additional duties.

Those making comments had to provide the 10-digit subheading of the HTSUS most applicable to the particular product that was requested for exclusion, and could submit information on the ability of U.S. Customs and Border Protection to administer the requested exclusion. Among other information, the quantity and value of the Chinese-origin product was requested. With regard to the rationale for the requested exclusion, the following factors were to be addressed:

  • Whether the particular product is available only from China and specifically whether the particular product and/or a comparable product is available from sources in the United States and/or third countries
  • Whether the imposition of additional duties on the particular product would cause severe economic harm to the requestor or other U.S. interests
  • Whether the particular product is strategically important or related to “Made in China 2025” or other Chinese industrial programs

 

For more information on this topic or to learn more about KPMG’s Trade & Customs Services, contact:

Doug Zuvich
Partner and Global Practice Leader
T: 312-665-1022
E: dzuvich@kpmg.com

John L. McLoughlin
Principal and East Coast Leader
T: 267-256-2614
E: jlmcloughlin@kpmg.com

Andy Siciliano
Partner and National Practice Leader
T: 631-425-6057
E: asiciliano@kpmg.com

Steve Brotherton
Principal and Global Export and Sanctions Leader
T: 415-963-7861
E: sbrotherton@kpmg.com

Luis (Lou) Abad
Principal, Washington National Tax
T: 212-954-3094
E: labad@kpmg.com

Irina Vaysfeld
Principal
T: 212-872-2973
E: ivaysfeld@kpmg.com

Amie Ahanchian
Principal
T: 202-533-3247
E: aahanchian@kpmg.com

Christopher Young
Principal
T: 312-665-3229
E: christopheryoung@kpmg.com

Gisele Belotto
Managing Director
T: 305-913-2779
E: gbelotto@kpmg.com

George Zaharatos
Principal
T: 404-222-3292
E: gzaharatos@kpmg.com

Andy Doornaert
Managing Director
T: 313-230-3080
E: adoornaert@kpmg.com

Jessica Libby
Managing Director
T: 612-305-5533
E: jlibby@kpmg.com

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