Trade Attorney Sees CBP Reluctance to Provide Section 232 Duty Guidance

"Customs is refusing to issue Customs rulings on how to value aluminum and steel," Sitkowski said during a Jan. 15 webinar hosted by the Ireland-based International Trade Institute. Sitkowski said her views are her own and should not be considered as legal advice.

"There's [been] a couple rulings that were issued in the fall [where] the importer has asked, a) whether their product is subject to the correct classification of their product, and then b) if it is subject, how they're supposed to value. And Customs says that's a [Section] 232 Commerce [Department] issue, [so] we can't talk about that."

She noted that CBP was directed in executive orders from President Donald Trump to come up with a way to value steel and aluminum, according to Sitkowski.

Sitkowski said CBP has made it challenging for importers to conduct reasonable care because CBP has not issued informed compliance publications, customs rulings or frequently asked questions on how to value steel and aluminum content, particularly for derivatives.

While a one-page paper passed around LinkedIn from CBP's base metals Center of Excellence and Expertise describes how importers should value steel, aluminum and copper (see 2512120049), that document has not been published for wide distribution, which means that it can't be taken as definitive guidance, according to Sitkowski.

"If there are no customs rulings on it, and there's nothing public except for this random piece of paper that certain random people are getting ... it's really not public because it's not published anywhere," Sitkowski said.

Since the document is only unofficial guidance, importers are supposed to rely on the plain language of the executive order. The only official guidance CBP has issued is in a FAQ, which cites the principles of the valuation statute, 19 U.S.C. 1401a.

"This is not legal advice and it is my opinion -- but what I tell my clients is, listen, if you get a CF-28 or a CF-29, you know that this piece of paper is the position that Customs is going to take until the Court of International Trade tells them otherwise," Sitkowski said. "But you have to ask, with everything you know about reasonable care, whether following a secret piece of paper, that doesn't actually match the principles of 19 U.S.C. 1401a, is reasonable care."

In addition to discussing valuations to calculate Section 232 duty obligations, Sitkowski and international trade expert Kolja Mendel and International Trade Institute Managing Director Fiona Luciani, the moderator, also discussed issues surrounding the Supreme Court's hearing on the legality of tariffs under the International Emergency Economic Powers Act.

The challenge in this trade environment is that the White House seems to be unwilling to follow precedent, which is why there seemed to be a rush to file preemptive lawsuits before the Court of International Trade (see 2512180072), according to Sitkowski.

"There's still some fear, because this is the anything-can-happen Trump administration, that the Supreme Court or the Court of Appeals for the Federal Circuit or the Court of International Trade at some point in time may say, if you didn't file your lawsuit before the Supreme Court made its opinion, you don't have any tariffs," Sitkowski said. But this action is contrary to 1581(i), because 1581(i) jurisdiction gives a company two years from the date the cause of action accrues to sue, she continued.

However, "this is the anything-can-happen Trump administration, so a lot of importers are still filing lawsuits, not because they don't understand the precedent. They just think that this administration doesn't give a crap about precedent. ... They're filing it more to protect themselves, because there's millions and billions of dollars at issue," she said. She added that she and others have been recommending that companies file protests because that keeps entries open administratively.

Sitkowski also discussed what actions Trump might undertake should the Supreme Court decide that the president doesn't have the authority to levy tariffs under IEEPA. She said it is likely that Trump may seek to issue new tariffs using different regulations.

"We have understood that the administration has plans, basically, on the day the opinion is issued, to issue new tariffs, so the tariffs aren't going to go away. They're just going to change form," Sitkowski said.

One possibility is to levy tariffs under Section 122 of the Trade Act of 1974, which enables the U.S. president to declare a national emergency related to the balance of tariffs (see 2511070045). This occurred during the U.S. oil crisis in the 1970s, according to Sitkowski. While the tariffs of up to 15% would be effective immediately, they may only last for 150 days.

The other option is to levy tariffs under Section 338 of the Tariff Act of 1930, which was brought up during oral argument before the Supreme Court. Section 338 (see 2601120012) allows the president to issue a proclamation that if a foreign country is discriminating against the U.S., the president may impose tariffs of up to 50%. However, the tariff doesn't take effect until 30 days after a proclamation has been made.

One possibility for why Trump posted on Truth Social early this week about imposing tariffs on countries dealing with Iran (see 2601130051) is that the post could serve as Trump's proclamation enabling action under Section 338, according to Sitkowski. "I think he could use Section 338 to impose the Iran tariff," she said.