President Donald Trump tweeted in the morning July 26 that the U.S. would "announce a substantial reciprocal action on Macron’s foolishness shortly. I’ve always said American wine is better than French wine!" Trump, who was angry about the digital services tax France put on what he called "our great American technologies companies," reportedly does not drink alcohol. Later in the day, a White House spokesman issued a statement that said: “The United States is extremely disappointed by France’s decision to adopt a digital services tax at the expense of U.S. companies and workers. France’s unilateral measure appears to target innovative U.S. technology firms that provide services in distinct sectors of the economy. It also demonstrates France’s lack of commitment to the ongoing [Organisation for Economic Co-operation and Development (OECD)] negotiations. The Trump Administration has consistently stated that it will not sit idly by and tolerate discrimination against U.S.-based firms. The U.S. Trade Representative has already launched a Section 301 investigation into France’s digital services tax, and the Administration is looking closely at all other policy tools.” Wine was already on the proposed tariff list to compensate for Airbus subsidies (see 1904090031).
President Donald Trump appeared to put the kibosh on Apple’s requests for List 3 Section 301 tariff exclusions on Chinese imports of graphics processing modules, power supplies, heat sinks and a dozen other types of components for the Mac Pro desktop due this fall. Tweeted Trump on July 26: “Apple will not be given Tariff waiver, or relief, for Mac Pro parts that are made in China. Make them in the USA, no Tariffs!” There are “no other sources” outside China “for this proprietary, Apple-designed component,” Apple said in each of the 15 product exclusion requests it filed July 18, as searchable on the Office of the U.S. Trade Representative public docket. “This product is a component of a consumer electronic device,” Apple said. “It is not strategically important or related to ‘Made in China 2025' or other Chinese industrial programs.” Public responses in support or opposition to the exclusion requests are due Aug. 1, and Apple had few backers among those who weighed in with an opinion as of July 26. “The USTR should not set a harmful precedent of exempting companies from tariffs that move jobs to an overt adversary of the United States,” commented Gregory Lewandowski on Apple’s request for tariff exclusions on Mac Pro graphics processing modules. “This is absolute garbage,” commented Logan Marotz. “We cannot continue to bend to the will of these companies. They knew the possible consequences of their actions by moving their assembly factories over seas. Tough luck, but this is the game they play.” Apple didn’t comment, nor did USTR.
CBP has assessed about $30.9 billion in duties under the major trade remedies started during the Trump administration as of July 24, according to CBP's trade statistics page. That includes $22.1 billion in duties from the Section 301 tariffs on goods from China. The first tranche of Section 301 tariffs took effect on July 6, 2018 (see 1807050033); the second took effect on Aug. 23, 2018 (see 1808070046); and the third, on Sept. 24, 2018 (see 1809240015). CBP also has assessed about $6 billion under the Section 232 tariffs on steel and $1.9 billion under tariffs on aluminum. The Section 201 trade remedies on washing machines, washing machine parts and solar cells (see 1801230052), imposed Jan. 23, 2018, account for $933.2 million in assessed tariffs.
The number of investigations under the Enforce and Protect Act almost doubled in fiscal year 2018, CBP said in its annual report, and the agency was able to issue final determinations for 12 investigations that year; in fiscal year 2017, it finished only one. To conduct EAPA investigations, CBP has traveled to Thailand, Vietnam, China, Malaysia, Cambodia and the Philippines. During the year, it took interim measures in six ongoing EAPA investigations to collect antidumping and countervailing duties. The entire EAPA program prevented the evasion of $50 million in AD/CVD duties during the year, the agency said.
CHICAGO -- The Office of the U.S. Trade Representative will provide information on what will happen to approved Section 301 exclusion requests beyond a year, said Arthur Tsao, associate general counsel at USTR, while speaking July 23 at the CBP Trade Symposium. "If the current trade actions continue to be in effect past those periods, USTR will issue additional guidance before the expiration of the one-year period," he said. The agency said something similar previously in a set of frequently asked questions (see 1906190035). Asked about the possibility of CBP extending the protest period for liquidated entries that involve products still being considered for exclusion requests (see 1905220063), CBP Chief-Entry Process and Duty Refunds Branch in the Office of Trade's Regulations and Rulings Division Gail Kan said the agency is unable to make a change because the timing requirements are statutory.
International Trade Today is providing readers with some of the top stories for July 15-19 in case they were missed.
After Guatemala's high court ruled that country could not enter into an agreement that would deny Hondurans refuge in the U.S. unless those migrants applied for asylum in Guatemala, President Donald Trump lashed out July 23 on Twitter. "Guatemala, which has been forming Caravans and sending large numbers of people, some with criminal records, to the United States, has decided to break the deal they had with us on signing a necessary Safe Third [country] Agreement. We were ready to go. Now we are looking at the “BAN,” Tariffs, Remittance Fees, or all of the above. Guatemala has not been good. Big U.S. taxpayer dollars going to them was cut off by me 9 months ago," he wrote.
About 83 percent of respondents to a United States Fashion Industry Association survey say they'll reduce the amount of apparel they source from China in the next two years -- a strong increase from the 67 percent who said they planned to do that last year. But given that only 6.7 percent said their reductions in Chinese sourcing would be significant, it appears that Section 301 -- and the uncertainty of whether more apparel will be affected -- has had somewhat muted effects on the industry.
CBP created Harmonized System Update (HSU) 1913 on July 21, containing 113 Automated Broker Interface records and 23 Harmonized Tariff Schedule record, it said in a CSMS message. The update includes adjustments required by the Office of the U.S. Trade Representative's announcement of new exemptions from Section 301 tariffs on China (see 1907080008). Modifications required by the verification of the 2019 HTS are included as well.
China believes that trade “frictions” with the U.S. “should be resolved through dialogue and consultation,” a Foreign Affairs Ministry spokesperson said on July 17. He was asked about President Donald Trump’s July 16 Cabinet meeting remarks that the U.S. has a “long way to go” before reaching a trade deal with China and can still impose the threatened List 4 Section 301 tariffs on $325 billion worth of Chinese goods “if we want.” If the U.S. “thinks there is still a long way to go before a deal is concluded, well, as the Chinese saying goes, a journey of a thousand miles begins with a single step,” the spokesperson said. “No matter how long the way is, as long as you step forward, you will eventually reach the destination.” In the face of the U.S. threat to impose the List 4 duties, “China will firmly defend its own interests,” the spokesperson said. “If the U.S. does impose new tariffs, that will indeed set new obstacles for the trade talks. There will be an even longer way to go before reaching a deal.”