President Donald Trump might not stick to a March 1 deadline for deciding whether to raise the 10 percent Section 301 tariffs on about $200 billion in China imports to 25 percent, he told reporters at the White House Tuesday. If the U.S. and China are "close to a deal" on comprehensive trade overhaul, "I could see myself letting that slide for a little while," said Trump. "But generally speaking, I'm not inclined to do that." Trump said he's comfortable keeping tariffs on Chinese goods if he doesn't get a real agreement, "not just a deal that cosmetically looks good for a year."

Imports at major U.S. retail container ports are down from their peaks of last fall but remain at “higher-than-usual levels” as retailers try to beat a possible March 2 hike in the 10 percent Section 301 tariffs on $200 billion worth of Chinese goods, said the National Retail Federation Monday. “With trade talks with China still unresolved, retailers appear to be bringing spring merchandise into the country early in case tariffs go up in March,” said NRF. “We are hopeful that the talks will succeed, but until the trade war is behind us, retailers need to do what they can to mitigate the higher prices that will inevitably come with tariffs.” Tariffs are scheduled to increase to 25 percent March 2 unless U.S.-China negotiations on a comprehensive trade deal are successful (see 1812140045). U.S. ports handled 1.97 million 20-foot-long cargo containers or their equivalents in December, the latest month for which data are available, said NRF. That was up by 8.8 percent from November and by 13.9 percent from December 2018, it said.

The Office of the U.S. Trade Representative should defend U.S. interests against intellectual property threats in the EU, China and various countries, tech groups commented through Thursday night. USTR collected comments for its Special 301 report on international IP practices. Copyright safe harbors included in the Digital Millennium Copyright Act and exceptions like fair use are critical, the Internet Association said, citing IP threats from the EU, China and others. Efforts to chip away at the safe harbor framework “threaten the ability of internet companies to expand globally by eliminating” copyright certainty, IA said. BSA|The Software Alliance cited “digital protectionism and isolationism.” Restrictions on “cross-border data transfers; coercive technology transfer; and discrimination against foreign companies, products, and technologies” are counter to U.S. interests, BSA said. The Computer & Communications Industry Association asked USTR to recognize that Europe is attempting to weaken liability protections and enact “copyright policies that will likely have significant negative consequences for the digital economy” like “snippet taxes.” Counterfeiting and piracy in China “remain at epidemic levels,” the U.S. Chamber of Commerce said. Ongoing trade negotiations offer opportunity for the U.S. and China to address IP protection and technology transfer issues, the chamber said. Theft and infringement in China continue to put the software industry at risk, ACT|The App Association said, recommending China remain on the priority watch list. Algeria, Argentina, India, Indonesia, Kuwait, Russia and Ukraine also should remain on the list, ACT said. Public Citizen raised concerns about Malaysia, which hasn't been on the watch list since 2012.

With less than a month before the 10 percent Section 301 tariffs on Chinese imports are scheduled to rise to 25 percent (see 1812140045), resolving the U.S.-China trade dispute “is a tall order, under the best of circumstances,” blogged Baker McKenzie customs lawyer Ted Murphy Monday. “By most accounts, the two sides are still far apart” in their quest to negotiate a comprehensive trade deal by the March 2 deadline, he said. Murphy doubts “a substantive solution will be reached in the next 30 days." The "question is whether China’s offer to purchase more U.S. products” and impose “some small structural changes” in its trade practices will be sufficient to get the Trump administration to “declare victory” and again postpone the tariff hike while the two sides keep talking, he said.

Ethernet switches, routers and network cards made in China but programmed in the U.S. are of American origin for government procurement purposes, Customs and Border Protection said. The U.S. is "where the non-functional devices are substantially transformed as a result of downloading performed in the United States, with software developed in the United States," the agency said in Tuesday's Federal Register.

The Office of the U.S. Trade Representative is wrong to propose lowering the de minimis threshold on shipments from Canada and Mexico, said the Internet Association. A lower threshold would mean more goods crossing borders could be subject to duties. "A consistent, high de minimis threshold benefits the entire American e-commerce system, including thousands of small businesses that use the internet to export and import," said IA Director-Trade Policy Jordan Haas Wednesday. USTR’s proposed provision in legislation implementing the new North American Free Trade Agreement “would force small businesses to navigate a complicated, confusing net of customs rules,” said Haas. Businesses complained that even the concessions won in the new NAFTA are complicated and confusing, because Mexico and Canada have different de minimis levels for sales taxes and for customs duties.

“High-ranking” U.S. and China officials made progress in two days of “intense and productive negotiations” that ended Thursday in Washington toward a comprehensive trade deal, but “much work remains to be done,” said the White House. President Donald Trump regards the 90-day negotiating window to which he and Chinese President Xi Jinping agreed in Buenos Aires for reaching a trade agreement (see 1812030002) as “a hard deadline,” it said. The U.S. will raise to 25 percent the 10 percent Section 301 tariffs now in effect on $200 billion worth of Chinese imports unless the two sides “reach a satisfactory outcome” by March 1, it said.

The Office of the U.S. Trade Representative is wrong to propose lowering the de minimis threshold on shipments from Canada and Mexico, said the Internet Association. A lower threshold would mean more goods crossing borders could be subject to duties. "A consistent, high de minimis threshold benefits the entire American e-commerce system, including thousands of small businesses that use the internet to export and import," said IA Director-Trade Policy Jordan Haas Wednesday. USTR’s proposed provision in legislation implementing the new North American Free Trade Agreement “would force small businesses to navigate a complicated, confusing net of customs rules,” said Haas. Businesses complained that even the concessions won in the new NAFTA are complicated and confusing, because Mexico and Canada have different de minimis levels for sales taxes and for customs duties.

CTA agrees with the Congressional Budget Office “assessment” that tariffs on Chinese imports are taxes on U.S. consumers and businesses, but CBO underestimated damage the higher duties will inflict on the tech sector and U.S. economy, emailed Sage Chandler, vice president-international trade policy. CBO estimated the higher import tariffs will reduce U.S. GDP by roughly 0.1 percent yearly through 2029 (see 1901290001). “The U.S. tech industry alone is paying $1 billion a month on tariffs,” said Chandler Tuesday. “Potential short- and mid-term impact of tariffs could be more destabilizing than indicated by CBO’s analysis. Not only do tariffs increase costs for American business and slow U.S. economic growth, real potential exists -- and warning signs are already evident -- that destabilizing global supply chains may have detrimental effects that spill in to global equity markets.” CBO didn’t comment Wednesday.

China is “highly concerned” about DOJ’s 13-count indictment against Huawei and Chief Financial Officer Meng Wanzhou on bank fraud, obstruction of justice and other allegations (see 1901280052), said a Foreign Ministry spokesperson Tuesday. Meanwhile, legislators ramped up scrutiny. The U.S. uses its “national power” to “tarnish and crack down on specific Chinese companies in an attempt to strangle their lawful and legitimate operations,” said China's spokesperson. “Behind such practices are deep political intentions and manipulations.” In detaining Meng in Vancouver in early December, the U.S. and Canada “abused their bilateral extradition agreement and took compulsory measures against a Chinese citizen for no reason,” the spokesperson said. The U.S. should “immediately withdraw” Meng’s arrest warrant, “refrain from making a formal extradition request, and stop going further down the wrong path,” he said. Senate Commerce Committee Chairman Roger Wicker, R-Miss., pressed national security officials during Tuesday's Senate Armed Services Committee hearing about Huawei and ZTE's national security threat. Wicker earlier praised the indictments. Commerce is “taking a hard look" at Huawei given its “activities and impact on developing technologies, such as 5G and autonomous vehicles, as well as network security and consumer data protection,” he said. Intelligence Committee Chairman Richard Burr, R-N.C., welcomed the indictments, “which detail the company’s brazen efforts to steal corporate trade secrets, commit fraud, and obstruct justice.” Vice Chairman Mark Warner, D-Va., said it's a “reminder that we need to take seriously the risks of doing business with companies like Huawei and allowing them access to our markets, and I will continue to strongly urge our ally Canada to reconsider Huawei’s inclusion in any aspect of its 5G infrastructure.” Commerce Security Subcommittee Chairman Dan Sullivan, R-Alaska, tweeted the indictments show "just one more example of Chinese businesses unwilling to play by the rules." The panel "will be conducting serious oversight of these Chinese threats to the U.S. economy," he said.