It’s impossible to forecast how many product-specific exemptions to the Section 301 tariffs on Chinese imports the Office of the U.S. Trade Representative will grant “because we’re in uncharted territory,” David Cohen, a trade expert with Sandler Travis, told a Sports & Fitness Industry Association webinar Oct. 11. With Tuesday’s deadline having lapsed for requesting exemptions to the first round of tariffs that took effect July 6, USTR denied 108 requests of the more than 10,000 filed and has yet to grant a single exemption, Cohen said.

A toolset that is classifiable under a subheading not covered by the Section 301 tariffs is still subject to those tariffs because one of the components is subject to the tariffs, CBP said in a Sept. 6 ruling, HQ H299857. CBP's ruling followed a request for reconsideration of a ruling on the toolset at issue. Marilyn-Joy Cerny of Sandler Travis filed the reconsideration request and argued that the initial ruling "improperly extended the Section 301 measures to sets classified in subheading 8206.00.00," CBP said.

Master Electronics will absorb costs of Section 301 tariffs on Chinese imports that took effect over the summer by establishing itself as a “tariff free zone,” the electronics components distributor said in a news release. It’s vowing no tariff-related price increases or surcharges “for the foreseeable future.” The first two rounds of 25 percent tariffs took effect July 6 and Aug. 23. The third round took effect Sept. 24 at 10 percent, but is scheduled to rise to 25 percent after Jan. 1. “Our prices do change regularly based on supplier prices and market elements,” the company’s website says. “There will be no price change, surcharges, or fees due to tariff policy.”

The U.S. Hide, Skin and Leather Association and the American Apparel and Footwear Association are preparing an opinion piece to "address the benefits associated with updating the 9802 program," the USHSLA said in an email. Heading 9802 allows for "companies to deduct any U.S. components from their imported merchandise before assessing duty," the group said. The USHSLA didn't give any more specifics on the piece, which will run in The Hill. The Office of the U.S. Trade Representative recently ended the special tariff provisions in Chapter 98 for U.S. goods returned after assembly, repair, alterations and processing that are subject to Section 301 tariffs (see 1808160049).

Master Electronics will absorb costs of Trade Act Section 301 tariffs on Chinese imports that took effect over the summer by establishing itself as a “tariff free zone,” said the electronic components distributor Thursday. It’s vowing no tariff-related price increases or surcharges “for the foreseeable future.” The first two rounds of 25 percent tariffs took effect July 6 and Aug. 23 and the third round took effect Sept. 24 at 10 percent, but scheduled to rise to 25 percent after Jan. 1. “Our prices do change regularly based on supplier prices and market elements,” says the company’s website. “There will be no price change, surcharges, or fees due to tariff policy.”

Costco sees “many moving parts” in an “extremely fluid” environment now that Trade Act Section 301 tariffs are in effect on $250 billion worth of Chinese imports, said Chief Financial Officer Richard Galanti on an earnings call Thursday. Working with suppliers “to see what can be done to reduce and/or absorb some of the costs” is one of the strategies Costco is “exploring,” said Galanti. “Reducing our commitments on certain impacted items” is another possible remedy, he said. There’s “limited ability” to find “alternative country sourcing,” even where that’s “possible and feasible,” and that “takes time,” he said. “We’ll have to see how customers and competitors react to tariffs, and what impacts it will have.” It’s in Costco’s “DNA” to be the last to raise prices on consumers, and “we want to work with any supplier to figure out how to not do that,” said Galanti. That Costco has more than $138 billion of purchasing power “affords us, I think, some opportunities that perhaps make it a little easier for us,” he said. People “smarter than me” don’t like tariffs, he said. “Whatever negative” they bring, “we can weather it better than others,” he said. Costco, through membership in the Retail Industry Leaders Coalition representing big-box retailers, lobbied unsuccessfully against the three rounds of tariffs.

International Trade Today is providing readers with some of the top stories for Oct. 1-5 in case they were missed.

Finished motors assembled in Mexico from three components from China are classifiable in subheading 8501.10.4060 and subject to the 25 percent tariffs under Section 301, CBP said in a Sept. 13 ruling modification. CBP reached the same conclusion as in the ruling being modified, NY N299096, but said that ruling was "incorrect as to the application of the NAFTA Marking Rules and the country of origin of the product." The original ruling request came from Johnson Electric in July, CBP said.

Past administrations of "both parties" gave "some lip service" to curbing China's unfair trade practices "but never followed through," National Economic Council Director Larry Kudlow said during a Q&A at the Economic Club of Washington Thursday. President Donald Trump "is following through" with the three rounds of Trade Act Section 301 tariffs he imposed over the summer, Kudlow said. He acknowledged he's "more of a doctrinaire free trader" than his boss, and that he opposed the administration's Section 232 tariffs on steel imports before joining the White House from CNBC. But there's "a lot of unfair trading practices" worldwide, and "the biggest culprit is China, and that can't be left alone," said Kudlow. "China has played fast and loose with the rules," he said. "The World Trade Organization needs reforms to enforce those rules. China's taken advantage. They're not a third-world country anymore. Why should we have to suffer?" Trump wants "a level playing field" with China, said Kudlow. "He wants reciprocity. Ultimately, he wants zero tariffs, zero non-tariff barriers, zero subsidies." Kudlow acknowledged tariffs "may be painful in some cases," but Trump is "a disrupter." Kudlow is "quite patient" with the policy, and confident a deal with China "can be negotiated" as a result, he said. It has been only "four or five months" since Trump first imposed tariffs, Kudlow said: "Let him do his work."

Costco sees “many moving parts” in an “extremely fluid” environment now that Section 301 tariffs are in effect on $250 billion worth of Chinese imports, Chief Financial Officer Richard Galanti said on an Oct. 4 earnings call. Working with suppliers “to see what can be done to reduce and/or absorb some of the costs” is one of the strategies Costco is “exploring,” Galanti said. “Reducing our commitments on certain impacted items” is another possible remedy, he said. There’s “limited ability” to find “alternative country sourcing,” even where that’s “possible and feasible,” and that “takes time,” he said. “We’ll have to see how customers and competitors react to tariffs, and what impacts it will have.” It’s in Costco’s “DNA” to be the last to raise prices on consumers, and “we want to work with any supplier to figure out how to not do that,” Galanti said. That Costco owns more than $138 billion of purchasing power “affords us, I think, some opportunities that perhaps make it a little easier for us,” he said. People “smarter than me” don’t like tariffs, he said. “Whatever negative” they bring, “we can weather it better than others,” he said. Costco, through membership in the Retail Industry Leaders Association representing big-box retailers, lobbied unsuccessfully against the three rounds of tariffs.