BALTIMORE -- Trade policy under President Donald Trump is upending years of largely consistent approaches to U.S. trading partners, panelists said during the American Association of Exporters and Importers annual conference on June 8. While the panelists mostly agreed that the consequences of the tariff-centric approach is too harsh, some expressed sympathy with the administration's general reaction to globalization.
Customs Duty
A Customs Duty is a tariff or tax which a country imposes on goods when they are transported across international borders. Customs Duties are used to protect countries' economies, residents, jobs, and environments, by limiting the flow of imported merchandise, especially restricted and prohibited goods, into the country. The Customs Duty Rate is a percentage determined by the value of the article purchased in the foreign country and not based on quality, size, or weight.
The European Union is budgeting for major improvements to its customs system between 2021 and 2027, the European Commission said in a June 8 news release. The EC said it will budget about $1.1 billion in customs improvements for the six-year span, up from $616 million from 2014-2020, it said in a fact sheet. "The new customs budget will help customs administrations to deal with increasing trade flows and emerging trends and technologies, such as e-commerce and blockchain," it said. The EU collected about $23.9 billion in customs duties on imports during 2017, it said.
A federal court recently dismissed a whistleblower lawsuit filed over pipes imported from China that were allegedly misclassified in order to avoid antidumping and countervailing duties. The May 23 decision in U.S. District Court for the Northern District of Illinois Eastern Division was highlighted in a Hogan Lovells blog post. The False Claims Act (FCA) lawsuit was filed by Roger Schagrin, a lawyer with experience in international trade and the steel industry, in 2014 against LDR Industries. Plaintiffs in successful whistleblower lawsuits involving defrauding the government are allowed to receive a portion of the recovered funds.
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Businesses that rely on steel are being whipsawed by the shifting parameters of 25 percent tariffs, and some have been waiting two months to find out if any of what they import will be spared. None of the thousands of product exclusion requests have been accepted or rejected so far by the Commerce Department's Bureau of Industry and Security.
An eagerly awaited CBP ruling on how foreign-trade zones are treated under Section 321 entry exemptions is expected to conclude that withdrawals from FTZs don't meet the requirements for such exemptions, National Association of Foreign-Trade Zones President Erik Autor said in a June 5 interview. Among other issues, CBP was considering whether larger shipments can be brought into foreign-trade zones, then broken up into smaller shipments valued under the $800 de minimis so they can be entered exempt from taxes and fees under Section 321 (see 1802140015).
CBP "determined that there is substantial evidence" that American Pacific Rubber (APAC) evaded antidumping duties on imported oil country tubular goods (OCTG), the agency said in a May 21 final determination. The evidence showed that "the OCTG pup joints imported by APAC from Vietnam were steel OCTG tubing that was misidentified as upper extension nipples, misclassified under subheading 8413.91.9080, HTSUS, and entered into the customs territory of the United States without the cash deposits." The investigation was the result of allegations submitted by Aztec Manufacturing Partnership that APAC evaded antidumping duties on the goods (see 1710230023).
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Two U.S. manufacturers filed a petition on May 21 with the Commerce Department and the International Trade Commission requesting new antidumping duties on steel propane cylinders from China, Taiwan and Thailand, and new countervailing duties on steel propane cylinders from China. Commerce will now decide whether to begin AD/CVD investigations on steel propane cylinders that could eventually result in the assessment of AD/CV duties. The petition was filed by two U.S. manufacturers, Worthington Industries and Manchester Tank & Equipment Co.
Despite the Trump administration's pause (see 1805200002) in adding Section 301 tariffs on goods from China, it's too early to end efforts toward product exemptions, Baker & McKenzie lawyer Ted Murphy said in a blog post. "While this is a positive development, it is also subject to change," he said. "As a result, for now, we are recommending that companies continue to pursue exclusions just in case."