The Consumer Technology Association has hired Akin Gump to draft a complaint, which, if pursued in the Court of International Trade, would seek an injunction blocking the Section 301 tariffs on $200 billion worth of Chinese imports before the duties are scheduled to rise to 25 percent on Jan 1., said several sources familiar with CTA’s plans. The association is shopping the draft around with other anti-tariff trade groups, seeking their legal and financial backing to support a court challenge, the sources said.
The Retail Industry Leaders Association sent President Donald Trump a letter praising his plan to meet with the Chinese president, and said that raising tariffs on nearly $200 billion in Chinese imports to 25 percent on Jan. 1 would dampen the economy. The organization said it supports "targeted trade actions against intellectual property theft, unfair dumping or subsidies," but not the broad application of Section 301 tariffs. Direct engagement with President Xi "is vital to resolving this trade dispute and ensuring it does not undermine our nation’s record-setting economic expansion and hurt American families," RILA President Sandra Kennedy wrote Oct 24. Meanwhile, The Wall Street Journal on Oct. 25 reported that the U.S. won't engage in trade talks with China until the country's government presents a proposal to address U.S. intellectual property concerns.
Arris emphasized “serious concerns” in meetings with aides to Federal Communications Commission Commissioners Mike O’Rielly and Jessica Rosenworcel about “harmful effects” the third tranche of Section 301 tariffs will have on “U.S. 5G leadership" and broadband deployment, it said in a filing posted Oct. 23. The 10 percent tariffs took effect Sept. 24 on “core broadband infrastructure and networking equipment and other critical inputs for wireless and wireline connectivity, as well as consumer broadband equipment,” and “automatically increase” to 25 percent Jan. 1, Arris said. “At just the 10 percent level,” Arris estimates the fees will impose $200 million a year “in additional costs on its equipment and devices.” The levies already have had “serious business implications,” noting that an analyst downgraded Arris stock because of the higher expected tariff-related costs, the filing said. The tariffs “risk slowing deployment of 5G and broadband more generally, diverting resources away from 5G and other broadband research and development efforts,” it said. Arris also noted in the meeting the need for an “exclusion process” for the third tranche of duties to give affected companies “additional time to make adjustments to their operations and mitigate the harms.”
DALLAS -- Audio companies are bracing for the impact of the 10 percent Section 301 tariffs on Chinese imports that took effect a month ago, and are holding out hope that the Jan. 1 increase to 25 percent won't come to pass, vendors said at the fall meeting of the Home Technology Specialists of America. JL Audio, which sells subwoofers for the home market and speakers, subs and amplifiers for the marine and automotive spaces, is raising prices 6 percent on Nov. 15 on its home product line, said Doug Henderson, senior vice president-home audio.
PALM SPRINGS, Calif. -- CBP is increasing staffing levels at its Office of Regulatory Audit to keep up with “the revenue on the table” from the recent imposition of new tariffs and the Trump administration’s push for more enforcement, said Tom Jesukiewicz, field director of regulatory audit’s Los Angeles office, at the Western Cargo Conference on Oct. 20.
A letter from 10 Democratic senators to U.S. Trade Representative Robert Lighthizer complained about the fact that no exclusion process has been set up for the nearly $200 billion in goods from China subject to an additional 10 percent tariff under Section 301. Sen. Tim Kaine, who led the letter, asked why there hasn't been an exclusion process for the third tranche, while there is one for the first and second rounds of the tariffs. The senators urged that an exclusion process be established immediately, given that this third tranche of tariffs is set to increase to 25 percent on Jan. 1. Kaine also asked if there is any intention to implement an exclusion application process, and if so, how it will be implemented. A group of House lawmakers also asked Lighthizer about the exclusions process earlier this month (see 1810160049). A Republican Senate trade staffer said Oct. 23 that USTR is not pursuing an exclusion process for this larger list. He said the office still hasn't granted any exclusions from the first two lists, and allowing applications for the third tranche would be a logistical problem.
PALM SPRINGS, Calif. -- Piecemeal bond increases to satisfy CBP insufficiency notices won’t be enough to dig importers out of the hole created by recently imposed sections 232 and 301 tariffs on aluminum and steel and products from China, respectively, said Dave Jordan of Roanoke Trade on Oct. 20. While CBP looks at duties paid over the past 12 months to set bond requirements, importers have likely seen their duty liability spike in the past few months since the tariffs were imposed, and will “probably end up with an insufficiency letter again in a few months” as more time passes with the tariffs in effect, he said, speaking at the Western Cargo Conference. Importers should do their own calculations, taking the month with the highest amount of duties paid, multiplying that by 12 months and setting a bond at 10 percent of that amount. For example, an importer that averaged $500,000 in duties paid over the last two months should extrapolate that to $6 million over the year and get a bond for $600,000. Some importers' products covered by multiple trade remedies could see bond requirements rise substantially, Jordan said. One of his clients, an importer of solar panels subject to Section 201 safeguards and Section 301 tariffs, started with an $800,000 bond that’s now up to $11 million, he said. CBP has urged importers to be “proactive” in setting their bond amounts (see 1808210029), given the recent spike in insufficiency notices (see 1807260011).
Quota processing for quota entry summary lines with three or more Harmonized Tariff Schedule codes will require manual input by CBP, the agency said in a CSMS message. That situation may occur "if the line is properly classified with two chapter 99 HTS codes (a section 301 HTS and a quota HTS) and the commodity HTS," it said. "Until a programming fix can be implemented, once you have successfully transmitted into ACE a summary including a quota line with three or more HTS codes, please email your entry details to HQQUOTA@cbp.dhs.gov and your assigned Client Representative for assistance," the agency said.
International Trade Today is providing readers with some of the top stories for Oct. 15-19 in case they were missed.
The International Trade Commission posted Revision 13 to the Harmonized Tariff Schedule, adding provisions in Chapter 99 to implement tariff exemptions under the Miscellaneous Tariff Bill. All previously included notes to Subchapter II to Chapter 99 are eliminated. New tariff subheadings 9902.01.01 through 9902.18.01 are added, covering the goods that received duty exemptions in the latest MTB (see 1809140004). All of these changes took effect along with the MTB on Oct. 13. The tariff exemptions are in effect until the end of 2020. Though MTB grants exemptions from general duty rates, Section 301 and other additional duties still apply (see 1810150051).