BIS Likely to Add Nearly All Requested Derivatives to Steel and Aluminum 232 Tariffs: Lawyer
The Bureau of Industry and Security will likely approve nearly all newly submitted requests for inclusions of new tariff subheadings under 50% Section 232 tariffs on steel and aluminum derivatives, according to a Nov. 30 blog post by trade lawyer Paul Fudacz.
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Fudacz, a partner at Braumiller Law Group, said that "there is likely 100% chance" that all newly requested derivatives that aren't already subject to other tariff investigations will be added to the derivative product list in Chapter 99 of the Harmonized Tariff Schedule. In the previous round, he said, despite the submission of "well-reasoned rebuttal comments by importers of the affected articles," BIS denied zero inclusion requests based on them, and the ones that were denied were for products subject to other investigations, such as Section 301 or Section 232 investigations on autos and heavy trucks.
The first round of tariffs on steel and aluminum derivative products began around three months after BIS initially posted the inclusion requests for comments, meaning tariffs on the second round could begin in early January if the agency follows a similar timeline (see 2510070031).
Fudacz said that the "almost automatic approval" process for derivative products, some of which have "dubious relevance" to national security, is changing the scope of Section 232 tariffs "in a way not contemplated under the original steel / aluminum investigations." He noted that the original definition of derivatives adopted in a 2020 proclamation required that "the aluminum article or steel article represents, on average, two-thirds or more of the total cost of materials of the derivative article."
He said that this change could "undermine the legal underpinnings" of the tariffs and "open the door to legal challenges in the future."