Under Section 301 Action, USTR Releases Proposed Tariff List on Chinese Products

Under Section 301 Action, USTR Releases Proposed Tariff List on Chinese Products. All components produced in China and included in Section 301 will be subject to the new tariffs effective July 6. For the purpose of clarification, components manufactured in Taiwan and Hong Kong are not considered within the scope of Section 301, therefore are not subject to the additional tariff.

The IBS Electronics Group is now being notified by suppliers as to how they intend to pass through the new tariffs.

Since many suppliers produce components in multiple countries it is unknown until time of receipt/shipment if the Country of Origin on the components being shipped will be  China. For this reason our account managers and salespeople may not always know the Country of Origin at time of order placement. Because of the magnitude of the tariffs if the Country of Origin on the components being shipped to your company is China, IBS will have to begin passing through these tariffs on the effective date. We will continue to communicate with you as circumstances warrant further updates.

— Read the full Press Release:

WASHINGTON, DC – As part of the U.S. response to China’s unfair trade practices related to the forced transfer of U.S. technology and intellectual property, the Office of the U.S. Trade Representative (USTR) today published a proposed list of products imported from China that could be subject to additional tariffs.

Following USTR’s Section 301 investigation, President Trump announced in March that the United States will impose tariffs on approximately $50 billion worth of Chinese imports and take other actions in response to China’s policies that coerce American companies into transferring their technology and intellectual property to domestic Chinese enterprises.  These policies bolster China’s stated intention of seizing economic leadership in advanced technology as set forth in its industrial plans, such as “Made in China 2025.”

The proposed list of products is based on extensive interagency economic analysis and would target products that benefit from China’s industrial plans while minimizing the impact on the U.S. economy.  Sectors subject to the proposed tariffs include industries such as aerospace, information and communication technology, robotics, and machinery.

The proposed list covers approximately 1,300 separate tariff lines and will undergo further review in a public notice and comment process, including a hearing.  After completion of this process, USTR will issue a final determination on the products subject to the additional duties.

The total value of imports subject to the tariff increase is commensurate with an economic analysis of the harm caused by China’s unreasonable technology transfer policies to the U.S. economy, as covered by USTR’s Section 301 investigation.

Today’s announcement comes just days after the USTR filed a request for consultations with China at the World Trade Organization (WTO) to address China’s discriminatory technology licensing requirements.  Such consultations are the first step in the WTO dispute settlement process.  If the United States and China are unable to reach a solution through consultations, the United States may request the establishment of a WTO dispute settlement panel to review the matter.

The list of products and intended tariff increases can be found here.