China List 1 Tariffs Set to Begin on July 6, 2018


June 18, 2018

On June 15, 2018 the Office of United States Trade Representative (USTR) released its final notice of items affected by an additional 25% duty. This action is a result of the Section 301 investigation in which the USTR found “China’s acts, policies and practices relating to technology transfer, intellectual property, and innovation were unreasonable, discriminatory and a burden to the U.S. commerce.”

Beginning July 6, 2018, the additional 25% duty will be imposed under the new tariff heading 9903.88.01. These new duties apply in addition to all other applicable duties, fees, exactions, and charges. 

The final list (List 1) contains a pared down list of 818 lines from the original 1,333 lines published on April 6, 2018. The list covers subheadings under HTUS chapters 84, 85, 87, 88, and 90, including:

  • engines and motors,
  • construction, drilling, and agricultural machinery,
  • machines for working minerals, glass, rubber, or plastic,
  • rail locomotives and rolling stock,
  • motor vehicles and motorcycles,
  • helicopters and airplanes, and
  • testing, measuring, and diagnostic instruments and devices.

USTR Proposes to Expand China Duty List

The USTR also released a list of additional goods that may be subject to the 25% duty (List 2). List 2 proposes to add an additional 284 tariff subheadings as benefiting from Chinese industrial policies, ranging from HTSUS Chapters 27, 34, 38, 39, 70, 73, 76, 84, 85 88 and 90. Goods include:

  • plastics and plastic products,
  • industrial machinery,
  • machinery for working stone, ceramics, concrete, wood, hard rubber or plastic, and glass,
  • cargo containers,
  • tractors, and
  • optical fibers.

These items have an approximate annual trade value of $16 billion. The products on List 2 will undergo further review and public notice, and a comment process, including a hearing.

Written comments for List 2 only are due by July 20, 2018, with post-hearing comments due by July 31, 2018. Hearings will be held beginning July 24, 2018 at 9:30am; requests to appear are due by June 29, 2018. Requests must include a summary of the testimony and may be accompanied by a pre-hearing submission.   

Requests must be in English and sent electronically via www.regulations.gov under document USTR-2018-0018. See how to make a request Submission Requests.

We suggest reviewing both lists for specific subheading items.

The USTR recognizes that some U.S. companies may have an interest in importing items from China that are covered by the additional duties. An opportunity will be provided for the public to request the exclusion of particular products from the additional duties subject to this action. The USTR will issue a notice in the Federal Register with details regarding this process within the next few weeks. 

For further information or questions about this and other customs issues, contact George R. Tuttle, III at geo@tuttlelaw.com or at (415) 986-8780.

 

George R. Tuttle, III is an attorney with the Law Offices of George R. Tuttle in the San Francisco Bay Area.

The information in this article is general in nature, and is not intended to constitute legal advice or to create an attorney-client relationship with respect to any event or occurrence, and may not be considered as such.

Copyright © 2018 by Tuttle Law Offices.  

All rights reserved.  Information has been obtained from sources believed to be reliable.  However, because of the possibility of human or mechanical error by our offices or by others, we do not guarantee the accuracy, adequacy, or completeness of any information and are not responsible for any errors, omissions, or for the results obtained from the use of such information.

 

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