US Proposes 10% Tariff on Chinese Textiles, Industry Comments Welcomed

The U.S. recently announced proposed additional import tariffs, at the rate of 10%, on thousands of classifications of goods of Chinese origin. The list appears to include all, are nearly all of the classifications for fiber, yarn, fabric, and carpet (Harmonized Tariff Schedule Chapters 50 through 60).

The Office of the U.S. Trade Representative is accepting public comments on the proposal. Specifically USTR wants to hear from you regarding the specific tariff subheadings to be subject to increased duties whether:

• they should be removed from the list;
• they should stay on the list at 10%; or
• they should stay on the list but at a lower or higher rate.

Comments are due by August 17th and must address specific 8-digit tariff subheadings. Agathon Associates can assist U.S. companies in drafting and filing comments. Due to the complexity of matching the specific tariff subheadings with the products of interest to individual companies submitting comments I strongly urge interested companies to begin the process as soon as possible.

BACKGROUND

On July 17, 2018, the Office of the United States Trade Representative published in the Federal Register (83 FR 33608) Request for Comments Concerning Proposed Modification of Action Pursuant to Section 301: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation.

On June 20, 2018 (83 FR 28710), the U.S. Trade Representative (Trade Representative) provided notice of an initial action in the Section 301 investigation of the acts, policies, and practices of the Government of China related to technology transfer, intellectual property, and innovation. The initial action was the imposition of an additional 25 percent ad valorem duty on products of China with an annual trade value of approximately $34 billion, effective July 6, 2018. The June 20 notice also sought public comment on another proposed action, in the form of an additional 25 percent ad valorem duty on products of China with an annual trade value of approximately $16 billion. The public comment process in connection with the proposed additional action is ongoing. On July 6, 2018, China responded to the initial action by imposing increased duties on goods of the United States. In light of China's decision to respond to the investigation by imposing duties on U.S. goods, the Trade Representative proposes a modification of the action taken in this investigation. The proposed modification is to maintain the original $34 billion action and the proposed $16 billion action, and to take further action in the form of an additional 10 percent ad valorem duty on products of China with an annual trade value of approximately $200 billion. The products subject to this proposed supplemental action are classified in the HTSUS subheadings set out in the Annex to this notice. The Office of the U.S. Trade Representative (USTR) is seeking public comment and will hold a public hearing regarding this proposed modification of the action in the investigation.