Stillwater Designs and Audio made “exhaustive attempts” to find contract manufacturers in the U.S. and in third countries able to source the speakers it imports from China and escape the 15 percent Section 301 List 4A tariff exposure to those products, said the vendor Tuesday in the Office of the U.S. Trade Representative public docket. It filed separate tariff exclusion requests for speakers in their enclosures imported under the 8518.21.00.00 tariff code and speakers not mounted in their enclosures sourced under the 8518.29.80.00 subheading. Stillwater did find contract manufacturers “with potential to produce these goods," but none has "the capacity nor related infrastructure to support the volume,” it said. “Because these products and the technology required for production are considered run-of-the-mill, intellectual property infringement is a non-issue,” said the vendor. “The additional tariffs on these goods imported from China do not in any way influence the Chinese government to alter or change the policies and practices identified by USTR in its Section 301 Report. These goods simply have no connection to the targeted Chinese policies and practices identified in the USTR’s Section 301 investigation.” USTR is scheduled to roll back the List 4A tariffs by half Feb. 14. Importers that land tariff exclusions can qualify for refunds of duties paid retroactive to when List 4A took effect Sept. 1.

The Justice Department is adding new lawyers to its international trade office, indicating that there could be an uptick in Section 592 penalty cases against importers, according to Crowell & Moring’s 2020 Litigation Forecast. The hiring comes amid increased scrutiny on valuation and country of origin issues as Section 301 tariffs incentivize importers to find ways to reduce duty liability. “This likely means that CBP has already determined that a significant amount of penalty cases are not going to be resolved administratively and will proceed to litigation,” said David Stepp, a customs lawyer with the law firm.

Stillwater Designs and Audio made “exhaustive attempts” to find contract manufacturers in the U.S. and in third countries able to source the speakers it imports from China and escape the 15 percent Section 301 List 4A tariff exposure to those products, said the vendor Tuesday in the Office of the U.S. Trade Representative public docket. It filed separate tariff exclusion requests for speakers in their enclosures imported under the 8518.21.00.00 tariff code and speakers not mounted in their enclosures sourced under the 8518.29.80.00 subheading. Stillwater did find contract manufacturers “with potential to produce these goods," but none has "the capacity nor related infrastructure to support the volume,” it said. “Because these products and the technology required for production are considered run-of-the-mill, intellectual property infringement is a non-issue,” said the vendor. “The additional tariffs on these goods imported from China do not in any way influence the Chinese government to alter or change the policies and practices identified by USTR in its Section 301 Report. These goods simply have no connection to the targeted Chinese policies and practices identified in the USTR’s Section 301 investigation.” USTR is scheduled to roll back the List 4A tariffs by half Feb. 14. Importers that land tariff exclusions can qualify for refunds of duties paid retroactive to when List 4A took effect Sept. 1.

Stephen Vaden, general counsel at the Department of Agriculture, was approved for the Court of International Trade in early January. Vaden, in the hearing on his nomination, said he would decide later if he should recuse himself on Section 301 cases (see 1911150010). He was involved in discussions on aid to farmers sent because of Chinese retaliation for the Section 301 tariffs.

The Trump administration’s decision to delay proposed Section 301 List 4B tariffs last month led to stronger than expected PC spending in the holiday quarter, and led U.S. retailers to absorb additional inventory, said Canalys Friday, but concerns over Brexit led to lower gains in Europe, Middle East and Africa. The U.S. had 7 percent growth in Q4 vs. the prior-year quarter, to 17.9 million shipments, but 2020 “is unlikely to repeat the success of 2019,” said analyst Rushabh Doshi. Citing macroeconomic factors, Doshi said key markets including the U.S., Japan and India are expected to underperform for most of the year. Adding uncertainty is “a possible disruption to HP, which continues to be the target of a hostile takeover by Xerox,” Doshi said. In the U.K., PC shipments will likely accelerate as channels build inventory ahead of the Jan. 31 departure date from the EU, “as distributors are nervous about subsequent product delays between Northern Ireland and the rest of the UK,” said the analyst. The global PC market -- including desktop, laptops and workstations -- recorded its first full year of growth in eight years last year, growing 2.7 percent to 268.1 million shipments. Lenovo (6.4 percent), HP (6.6 percent) and Dell (10.6 percent) had growth, but Apple computer sales declined 8.1 percent.

The Trump administration’s decision to delay proposed Section 301 List 4B tariffs last month led to stronger than expected PC spending in the holiday quarter, and led U.S. retailers to absorb additional inventory, said Canalys Friday, but concerns over Brexit led to lower gains in Europe, Middle East and Africa. The U.S. had 7 percent growth in Q4 vs. the prior-year quarter, to 17.9 million shipments, but 2020 “is unlikely to repeat the success of 2019,” said analyst Rushabh Doshi. Citing macroeconomic factors, Doshi said key markets including the U.S., Japan and India are expected to underperform for most of the year. Adding uncertainty is “a possible disruption to HP, which continues to be the target of a hostile takeover by Xerox,” Doshi said. In the U.K., PC shipments will likely accelerate as channels build inventory ahead of the Jan. 31 departure date from the EU, “as distributors are nervous about subsequent product delays between Northern Ireland and the rest of the UK,” said the analyst. The global PC market -- including desktop, laptops and workstations -- recorded its first full year of growth in eight years last year, growing 2.7 percent to 268.1 million shipments. Lenovo (6.4 percent), HP (6.6 percent) and Dell (10.6 percent) had growth, but Apple computer sales declined 8.1 percent.

The phase one “economic and trade agreement” the U.S. and China signed Jan. 15 will take effect in 30 days and can be terminated by either country with 60 days' written notice, the deal's text said. Phase one is “a big step toward normalizing our trading relationship with China,” the Consumer Technology Association said, but “market uncertainty remains until we see permanent tariff removal.” The National Retail Federation also welcomed phase one but said phase two “can’t come soon enough.”

International Trade Today is providing readers with some of the top stories for Jan. 13-17 in case they were missed.

Tariffs on French champagne, cheeses, handbags and other products (see 2001060040) will not be coming, several news outlets are reporting, since France has agreed not to impose a Digital Services Tax in 2020 as negotiations continue at the Organization for Economic Co-Operation and Development on a fair way to impose income taxes on companies such as Google and Amazon.

The phase one “economic and trade agreement” the U.S. and China signed Wednesday will take effect in 30 days and can be terminated by either country with 60 days written notice, said the deal's text. Phase one is “a big step toward normalizing our trading relationship with China,” said CTA, but “market uncertainty remains until we see permanent tariff removal.” The National Retail Federation also welcomed phase one but said phase two “can’t come soon enough.”