Starting Feb. 7, the allowance of 1.2 million imported large residential washers will be allocated quarterly, which will make it harder for imports to compete with domestically produced washers, since demand is not even throughout the year, the Office of the U.S. Trade Representative said in a notice. The change, first announced in December 2019 (see 1912200068), will make the safeguard more effective, the administration said. In quota tariffs drop from 18 percent to 16 percent Feb. 7, as well; out of quota tariffs are 45 percent.
The Office of the U.S. Trade Representative seeks comments on its recently reinstated exclusion for bifacial solar panels from Section 201 safeguard duties on solar cells. USTR says it is considering whether to again revoke the exclusion, maintain it or “take some other action with respect to this exclusion.” After creating the bifacial exclusion in June 2019 (see 1906120019), USTR had rescinded the exclusion in October based on concerns that it was undermining the solar safeguard (see 1910080054). The Court of International Trade issued an injunction barring the exclusion’s withdrawal in December after finding USTR violated procedural rules by not allowing for public comment (see 1912050063).
The Office of the U.S. Trade Representative posted a notice on the coming tariff decrease for goods from China on the 4A list that was part of the phase one trade deal between the countries (see 2001150033). “In light of the scheduled entry into force of the phase one agreement,” the goods on the 4A list will be subject to 7.5 percent tariffs, down from 15 percent, starting Feb. 14 at 12:01 a.m. EST, the USTR said.
If Europe, Japan and the U.S. are able to convince the World Trade Organization to rewrite the language on subsidies and countervailing measures from the Uruguay Round Agreements, cases against Chinese subsidies -- or antidumping and countervailing cases responding to them -- would be tilted in favor of the market economies. The U.S. trade representative, Europe's new trade minister and the Japanese trade minister issued a joint statement Jan. 14 that the agreement on subsidies needs to have additional language prohibiting all “unlimited guarantees; subsidies to an insolvent or ailing enterprise in the absence of a credible restructuring plan” and subsidies to companies operating in sectors with overcapacity that can't get long-term financing from independent commercial sources. They also agree that “certain direct forgiveness of debt” should be categorically prohibited in international trade law, but they did not specify what forgiveness crosses the line.
The Office of the U.S. Trade Representative posted the transcripts from the hearing on Section 301 tariffs on France (see 2001060040) split over Jan. 7 and Jan. 8.
The panel deciding which French products should face Section 301 tariffs was intrigued by a point made by the Cheese Importers Association of America -- who could pay more on 21 Harmonized Tariff Schedule headings if all the proposed tariffs are included.
Vizio became the first major TV brand to seek exclusions from the List 4A Section 301 tariffs on finished flat-panel sets from China when it filed Jan. 7 for exemptions on four 10-digit classifications of goods under subheading 8528.72.64 that vary by screen size. Vizio is “working closely” with its third-party original design manufacturers to shift production outside China, the vendor posted in the Office of the U.S. Trade Representative public docket. “Some of the ODMs moved manufacturing to third countries including Mexico in the late Q3 2019 timeframe.” Despite those efforts, it’s “extremely difficult” for Vizio to transfer production to other third countries, including Taiwan, Thailand and Vietnam, “without significant cost” that would “far exceed” the “modest profit margin,” it said. That would “likely” result in a “significant price increase to American consumers,” it said. “Responsibly exploring alternatives to manufacturing, without sacrificing quality, safety, and the low prices that define our brand takes considerable time.” List 4A tariffs took effect Sept. 1 at 15 percent, but are due to be rolled back by half (see 1912310010).
Wine companies opposing the proposed tariffs on French goods so far dominate the requests to testify at the Jan. 7 hearing on the Office of the U.S. Trade Representative’s December finding that France’s digital services tax discriminates against U.S. companies (see 1912030039). “As an independent family owned company in the wine distribution and import business I request a chance to be heard and to explain my and all of my colleagues fears about the tariffs and the impact they will have on American businesses,” David Bowler said, for example. The agency is considering up to 100 percent retaliatory tariffs on 63 subheadings of French imports worth about $2.4 billion in 2018 customs value, mainly cheese, beauty products, handbags and kitchenware. Written comments on USTR's proposed tariffs are due Jan. 6. Post-hearing rebuttals are due Jan. 14.
The volume of Section 301 List 4A tariff exclusion requests surpassed 1,000 on Dec. 19, 49 days after the Office of the U.S. Trade Representative opened the public docket to applications at noon on Halloween. Applicants that are granted exclusions can qualify for refunds of 15 percent tariffs retroactive to Sept. 1, when the duties took effect. List 4A tariffs remain in effect at 15 percent, but are expected to be rolled back by half after the U.S.-China phase one trade deal is signed sometime in January 2020. Under USTR rules, tariff exemptions are granted on all goods imported under a product classification, not just to the company making the exclusion request. Nine applications were filed through Dec. 19 to exempt goods imported under subheading 8517.62.00.90, more than for any consumer tech product with List 4A exposure. The subheading includes a broad swath of consumer tech goods, including smart speakers, Bluetooth headphones, fitness trackers and smartwatches. Virtually all List 4A exclusion requests filed by all companies through Nov. 29 were elevated to the status of a “stage 2 initial substantive review,” the docket shows. The final “stage 4” is when an exclusion request is granted and approved for publication in the Federal Register.
The U.S. may loosen Section 201 safeguard duties on crystalline silicon photovoltaic cells, according to a notice launching a new International Trade Commission investigation. The U.S. trade representative recently asked the ITC to study the economic effects of raising the threshold below which solar cells enter duty-free from 2.5 gigawatts to 4, 5 or 6 gigawatts, the ITC said. “I request that the Commission analyze the effect of increasing the level of the tariff-rate quota from the current 2.5 gigawatts (“GW”) to 4, 5, or 6 GW, without other changes to the remedy,” the USTR said in the request letter. Currently, imports of solar cells after the first 2.5 gigawatts face a 25 percent tariff, set to fall to 20 percent in February for the third year of the safeguard duty (see 1801230052). Comments are due to the ITC by Jan. 6, 2020.