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Section 301 Expirations and Exclusion Extensions

The USTR announced two sets of extensions covering products scheduled to lose their exclusions on Sept 20. The two sets cover 89 limited exclusions, 62 for products covered under Round 1 of the 301 China tariffs and seventeen from Round 2. These extensions are effective only until Deceber 31, 2020.

Nearly 100 products where not granted extensions and will lose their exclusions this weekend. A the full extension list for Round 1 can be found here and the list for Round two can be found here.

Provisional number 9903.88.53 will replace 9903.88.14 for goods on Round 1 while 9903.88.59 will replace 9903.88.17 for the good on Round 2. These provisional numbers will have to be updated in Customs system before they can be claimed.

Two more exclusion sets, one for goods covered by Round 1 and another for goods under Round 2, are scheduled to expire on October 2, 2020. We expect that we will receive a notice form the USTR on extensions to some of the exclusions but those lists will probably not be published until just before the expiration date.

WTO Rules Against U.S. on Section 301 Tariffs

A World Trade Organization (WTO) panel has ruled that the U.S. violated it’s obligations to the WTO when it imposed additional tariffs on goods from China. These tariffs were issued under Section 301 and implemented over four rounds beginning in April 2018. China’s complaint to the WTO claimed the tariffs violated the rules because they applied only to products originating from China, which violated the most favored nation principal requiring members to assess equal tariff rates on imports from other member nations. China also alleged a violation of dispute settlement rules which require a member to first seek recourse from the WTO before imposing retaliatory measures. The U.S. asserted that the Phase 1 agreement reached with China this year resolved the dispute, but this argument was rejected by the panel.

The panel’s report stated that the US had not met it’s burden of proof to demonstrate that the measures are justified. U.S. Trade Representative Robert Lighthizer issued a statement claiming the panel did not dispute the evidence submitted by the U.S. of intellectual property theft by China. He said the decision, “…shows that the WTO provides no remedy for such misconduct,” and added that the decision has no effect on the Phase 1 agreement.

This decision is unlikely to provide any tariff relief since the US is certain to appeal the decision in the next 60 days. An appeal effectively blocks enforcement of the decision since the US has not appointed new members to the appellate body precluding the panel’s ability to operate. The lack of an appeals process ends the legal nature of the dispute.  This decision could however be considered in the recent federal case challenging implementation of rounds 3 and 4A of the Section 301 tariffs on Chinese goods.

E.U. members are also watching this dispute with great interest since the US has threatened the use of Section 301 tariffs in retaliation for E.U. taxation of digital companies.

Need an overview of all the exclusions and their updated expirations? 

We have all the exclusion information updated and ready for you! Go to CVI’s Exclusion Guide 2020 (view on desktop for optimal search). Don’t forget! You can also find Rachel Shames’ weekly market updates HERE


">Sam McClure, LCB
Director of Compliance & Customs Services 


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