The country of origin for Fitbit smartwatches and fitness trackers is based on where the products' printed circuit board assemblies are manufactured, said Customs and Border Protection in an Oct. 3 ruling newly posted at the agency's website. Fitbit had asked CBP for a binding ruling. Fitbit devices are assembled in China from parts and components sourced from Taiwan and Singapore. It announced Wednesday it will shift production outside China starting in January for “effectively all of its trackers and smartwatches” to escape exposure to the 15 percent List 4A Section 301 tariffs on Chinese goods that took effect Sept. 1 (see 1910090025).

U.S. Trade Representative Robert Lighthizer declined to testify at an Oct. 16 hearing (see 1910070031) on Section 230 of the Communications Decency Act, the House Commerce Committee said Thursday. As the committee explores the statute’s consumer protection implications, “it’s extremely disappointing” Lighthizer “would refuse” to testify on the “inclusion of similar language in trade agreements,” a committee spokesperson said. The hearing would have been an “opportunity for him to explain” how such language in trade agreements “benefits Americans in light of consumers’ growing concerns about the health of the internet.” USTR didn’t comment.

Fitbit will shift production to "outside China" starting in January for “effectively all of its trackers and smartwatches” to escape exposure to the tariffs on Chinese goods, said the company Wednesday. "Those products will no longer be of Chinese origin and therefore not subject to Section 301 tariffs,” said Fitbit, without disclosing where it's moving its sourcing. Smartwatches and fitness trackers, comprising the entire Fitbit product line, were hit with 15 percent List 4A tariffs Sept. 1 as part of the broad category of 8517.62.00.90 goods that also includes smart speakers and Bluetooth headphones (see 1908130028). The company began exploring potential alternatives to China last year, said Chief Financial Officer Ron Kisling. It altered its supply chain and manufacturing operations with “additional changes underway,” the company said. Fitbit said it will give additional details, including the financial implications, on its Q3 call within the month. Fitbit devices are assembled in China from parts and components sourced from Taiwan and Singapore, but shifting final assembly outside China “has been a very big challenge for us,” testified Executive Vice President-General Counsel Andy Missan at a Section 301 hearing in June. The devices require “high-precision assembly and high volume,” he said then. "We have not been able to find those characteristics in other locations,” despite looking throughout Southeast Asia, he said.

The National Retail Federation expects U.S. imports from China to “surge” before the 15 percent List 4B Section 301 tariffs take effect Dec. 15 on Chinese goods, said NRF Wednesday. “This is the last chance to bring merchandise into the country before virtually everything the United States imports from China comes under tariffs,” said NRF. “Retailers are doing all they can to mitigate the impact of tariffs on their customers.” The tariffs' Q4 impact on prices "will vary by retailer and product," it said. It urged the Trump administration to use the two days of U.S.-China trade talks opening Thursday in Washington “to make progress toward ending the trade war and return to policies that promote long-term economic growth and prosperity for American families.” NRF estimates U.S. ports handled 1.97 million 20-foot-long cargo container equivalents in August. That was the highest monthly volume since the 2 million containers imported last October, it said. NRF forecast November imports will be up 8.9 percent year over year and tie those of August, as retailers use the last full month before List 4B takes effect to rush product in. August TV unit imports from China increased 22.3 percent sequentially from July (see 1910070050). August unit imports from China of the broad swath of smart speakers, Bluetooth headphones and smartwatches shipped here under the 8517.62.00.90 tariff code increased 21 percent sequentially from July to 11.78 million, said Census Bureau statistics accessed Wednesday through the International Trade Commission’s DataWeb tool. August shipments of 8517.62.00.90 goods from China were the highest in that category for any 2019 month. Experts will debate whether the August spikes were evidence of importers rushing product in to beat the 15 percent Section 301 tariffs on finished TV sets and 8517.62.00.90 goods from China that took effect Sept. 1. Skeptics said they doubted tariffs were behind the August surges because importers had little time after the duties were announced Aug. 1 to put goods on a boat in China and get them through U.S. ports before Sept. 1. "Absolutely," emailed JLab CEO Win Cramer Wednesday when we asked if he rushed in Bluetooth earbuds and other 8517.62.00.90 goods during August. "Everyone I know brought over as much as they could as fast as they could, JLab included," he said.

China said it “deplores and firmly opposes” Monday's action of the Commerce Department's Bureau of Industry and Security adding 28 Chinese entities to its trade blacklist for alleged involvement in human rights violations of China’s Uighurs and other Muslim minority groups in Xinjiang province. The human-rights allegations are “merely made-up pretexts” for U.S. interference in China’s “internal affairs,” said a Foreign Affairs Ministry spokesperson Tuesday. The U.S. criticism “is nothing more than fact-distorting gibberish,” he said. The 28 entities include eight China-based technology and science companies, among them Hikvision, a major supplier of video surveillance products. Hikvision opposes the BIS decision as one that "will hamper efforts by global companies to improve human rights" worldwide, emailed a company spokesperson Tuesday. Hikvision "respects human rights," she said. It has been "engaging" with Trump administration officials over the past year "to clarify misunderstandings about the company and address their concerns," she said. The action is effective Wednesday when it's to be published in the Federal Register, and it involves license requirements.

House Commerce Committee Chairman Frank Pallone, D-N.J., invited U.S. Trade Representative Robert Lighthizer to testify at an Oct. 16 hearing (see 1909260041) on Section 230 of the Communications Decency Act. Pallone and ranking member Greg Walden, R-Ore., wrote USTR in August asking Lighthizer to not include Section 230-like protections in trade deals, given ongoing policy discussions about the tech industry's liability shield. “It’s important for the Committee to hear directly from Ambassador Lighthizer about how these provisions may affect the ability of the United States and our trading partners to enforce existing laws or write new ones,” said Pallone. USTR didn't comment.

The U.S. government lacks technical knowledge and a single, leading voice in its approach to technology competition with China, the Brookings Institution was told. U.S. industries are concerned technology policies, such as export controls, are being made without full understanding of impact, said Adam Segal, Council on Foreign Relations emerging technologies chair. “We have to have a much better sense of the technologies involved and how they're actually deployed across a range of sectors," he told a Friday panel. Artificial intelligence isn't "going to look the same as quantum, which is not going to look the same as semiconductors, even though we’re all clumping them together as emerging technologies,” he added. The Commerce Department is working on tech export control regulations (see 1907110044). U.S. industries say there doesn’t seem to be a single voice for the U.S. on technology involving China, Segal said. “There are many voices, often competing, and not explicitly being driven from executive [branch] agencies." Abraham Newman, director of Georgetown University's Mortara Center for International Studies, doesn't believe the U.S. “has a clear strategy of what it’s pursuing vis-a-vis China in the technology sphere.” He wants the U.S. approach coordinated with trading partners: “I don’t have the sense that the current government is pursuing that.” The White House Office of Science and Technology Policy didn't comment.

When the Trump administration first threatened Section 301 tariffs on Chinese goods in a notice 18 months ago, few expected 15 percent to 30 percent duties would be in place now on more than half of Chinese imports, with virtually all the rest facing tariffs by Dec. 15, Chad Bown, trade economist at the Peterson Institute for International Economics, told a Washington International Trade Association conference Wednesday. But the markets "haven't panicked," said Bown, a former White House senior economist during the Obama administration. The tariffs in place the longest are on inputs and capital goods, not consumer products, he said. That's one reason for the unexpectedly subdued economic impact, he said. In the context of the overall size of the U.S. economy, "we don't actually trade all that much" in those goods, he said. Bown and Cinnamon Rogers, CompTIA executive vice president-public advocacy, expressed anxiety about media reports that President Donald Trump might restrict U.S. investments in China as further escalation of the trade war. "I don't think it's imminent," said Bown, but it's worrisome. Any new restrictions the U.S. puts on American investment in China would harm international trade and “global economic growth,” said China's Foreign Affairs Ministry Monday (see 1909300032). The White House didn't comment.

The Office of the U.S. Trade Representative is accepting applications from candidates for its Trade and Environment Policy Advisory Committee for a two-year “charter term” through September 2021, says an agency notice for Friday's Federal Register. The committee advises USTR on “trade policy matters that have a significant impact on the environment,” it said. Unpaid memberships are limited to 35 individuals from industry, academia, consumer groups and “others with expertise in trade and environment matters,” it said. USTR wants the committee to be “broadly representative of key sectors and groups of the economy,” it said. There’s no deadline for applications, but nominees will be accepted on a “rolling basis,” it said.

The next few months include a "rapid-fire succession of trade and tech war deadlines" with much uncertainty for the fight between the U.S. and China, Bank of America economists Ethan Harris and Alexander Lin wrote investors Monday. What happens with Huawei's temporary general license is likely the most important unknown, they said. Huawei would be cut off from all U.S. exports Nov. 17, but "we expect an 'extend and pretend' scenario where Huawei remains on the 'entity list' but is allowed to keep buying US inputs." The other deadlines, all of which occur over the next three months, involve tariff increases on products from China and a decision on whether to impose tariffs on autos and car parts. The U.S. Trade Representative's office and the Department of Commerce Bureau of Industry and Security didn't comment Tuesday.