As previously announced by President Donald Trump, the Section 232 steel and aluminum 25% ad valorem tariffs went into effect 12:01 a.m., March 12, 2025, against all steel and aluminum articles and all listed derivatives, including many automotive, construction and consumer products. Aluminum articles and their derivative products from Russia are subject to 200% tariffs. Customs and Border Protection (CBP) guidance confirms that “melted and poured” / “smelted and cast” reporting is due for all steel and aluminum articles and their derivative products. All existing tariff rate quotas and general/country exclusions have been terminated as of March 11, 2025. Currently, there is no process for interested U.S. parties to seek new product exclusion requests, and all currently-in-force product exclusions will end as of their end date or when quotas are reached. These Section 232 tariffs are in addition to any other imposed duties or tariffs, including the recent IEEPA tariffs imposed against China, Mexico and Canada. 

Updated CBP guidance can be found on the Cargo Systems Messaging Service (CSMS): 

  1. CSMS # 64384496 – UPDATED GUIDANCE: Import Duties on Imports of Aluminum and Aluminum Derivative Products
  2. CSMS # 64384423 – UPDATED GUIDANCE: Import Duties on Imports of Steel and Steel Derivative Products
  3. CSMS # 64375535 – Quota Guidance: Proclamation 10896 of February 10, 2025, Adjusting Imports of Steel and Aluminum into the United States

For additional background on these new tariffs on imported steel and aluminum articles and their derivative products from all countries, see Thompson Hine Updates of February 12, 2025 and February 14, 2025.

As expected, Canada and the European Union (EU) responded with countermeasures and retaliatory tariffs. The EU announced a two-step approach: (1) the end of the suspension of existing 2018 and 2020 countermeasures against the United States on April 1, 2025; and (2) a package of new countermeasures on U.S. exports to enter into force by mid-April 2025, following the consultation of EU member states and stakeholders. Canada responded with a “dollar-for-dollar” approach with 25% retaliatory tariffs on U.S. goods worth approximately $21 billion. The package of Canadian countermeasures is effective as of March 13, 2025. Canada also announced that these U.S. tariffs violate U.S. obligations under both the USMCA and the World Trade Organization (WTO) Agreement and that it will be seeking consultations with the United States as a first step in any dispute settlement under these agreements. Mexico has indicated that it may delay any retaliatory measures until April 2, 2025, when President Trump has indicated the United States will impose separate reciprocal tariffs, “to see if we also need to take some actions.”

Thompson Hine LLP’s International Trade practice group members continue to monitor these fluid and changing tariffs measures and will continue to report any significant developments.

On March 3, 2025, the Office of the U.S. Trade Representative (USTR) delivered President Donald Trump’s 2025 Trade Policy Agenda, 2024 Annual Report, and World Trade Organization at Thirty report to Congress. This year’s trade agenda seeks to strengthen the middle class and national defense and to address trade deficits by focusing on a “Production Economy” and implementing an “America First” approach in trade relations.

2024 Annual Report

The 2024 Annual Report provides a comprehensive overview of U.S. trade agreements, negotiations, and enforcement activities. It covers various trade initiatives, preference programs, and bilateral and multilateral engagements involving the United States and numerous countries. Specifically, the USTR in 2024 was actively involved in various trade agreements and negotiations, including (1) the Indo-Pacific Economic Framework for Prosperity (IPEF), (2) the United States–Taiwan Initiative on 21st-Century Trade, (3) the United States–Kenya Strategic Trade and Investment Partnership, and (4) the African Continental Free Trade Area Memorandum of Understanding. As in past years, the report notes that the United States continued to urge other countries to provide adequate IP protection and enforcement, addressing issues like copyright piracy, counterfeit products, and trade secret theft. The USTR also engaged with different countries to address issues like labor rights and improved enforcement of laws affecting labor, the environment, and agriculture.

2025 Trade Policy Agenda

The agenda outlines President Trump’s vision for addressing the economic and national security challenges facing the United States and follows the America First Trade Policy Presidential Memorandum released on his first day in office on January 20, 2025 (see Thompson Hine Update of January 22, 2025). This includes investigating the causes of the trade deficit, identifying unfair trade practices, and using leverage to open new markets for U.S. exports. The agenda emphasizes the need for a rebalanced trade policy that prioritizes American interests, focusing on a production-based economy to increase manufacturing jobs and the share of manufacturing in the gross domestic product (GDP).

A significant component of the agenda is the emphasis on trade agreements and an effort to “ensure that they help raise wages and grow our industrial base.” The agenda underscores the importance of reviewing existing trade agreements to ensure they operate in the national interest and do not allow third countries to benefit unfairly. The agenda calls for a thorough review of the United States-Mexico-Canada Agreement (USMCA) to “assess the impact of the USMCA on American workers, farmers, ranchers, service providers, and other businesses” in preparation for the mandated review of the agreement in July 2026.

The agenda places a strong focus on U.S. trade relations with China, “the single biggest source of [the U.S.] large and persistent trade deficit”. In doing so, it highlights the need to enforce the Phase One Agreement, which addresses critical issues related to technology transfer, intellectual property, and innovation. The USTR is tasked with assessing China’s compliance with the agreement and responding to additional unfair practices. This strategic approach aims to address the structural challenges distorting the global trading system, ultimately supporting U.S. workers, businesses, and national security. By taking a vigorous stance on trade enforcement, the agenda seeks to counter China’s non-market policies and practices, ensuring a level playing field for U.S. industries and promoting fair competition in the global market.

WTO at Thirty and U.S. Interests

The USTR’s Annual Report also includes a section on the World Trade Organization (WTO) and its effects on the interests of the United States, including “the costs and benefits to the United States of its participation in the WTO, and the value of the continued participation of the United States in the WTO.” This section of the report emphasizes that the WTO, established in 1995, has faced significant challenges in fulfilling its mission of promoting open, market-oriented policies and reducing trade barriers, particularly in addressing the non-market policies and practices of major economies like China. It argues that the dispute settlement system, especially the Appellate Body, has been criticized for overreach and creating new obligations beyond the agreed rules, undermining national sovereignty and the effectiveness of the WTO’s monitoring and enforcement functions. Despite these challenges, the United States remains committed to seeking reforms that can restore the WTO’s relevance and effectiveness. Achieving “meaningful reform” will require the active participation and cooperation of all WTO members, “including those that have benefited from the failure of the WTO to fulfill its objectives”.

In sum, the discussion on the WTO reflects an approach by the Trump administration to enhancing American economic interests, ensuring fair trade practices, and promoting national security. By focusing on rebalancing trade agreements, enforcing existing commitments, and advocating for meaningful reforms within the WTO, the administration aims to create a new global trading environment. These efforts are designed to support U.S. workers, middle class, businesses, and industries.

A press release outlining other key highlights of the report is available here. For an overview of the most recent past Annual Trade Policy Agenda and Annual Report, see Thompson Hine Update of March 5, 2024.

On March 6, 2025, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued General License (GL) 5R, “Authorizing Certain Transactions Related to the Petróleos de Venezuela, S.A. 2020 8.5 Percent Bond on or After July 3, 2025,” which continues to delay U.S. persons’ ability to enforce bondholder rights to the CITGO shares serving as collateral for the Petróleos de Venezuela, S.A. (PdVSA) 2020 8.5% bond until on or after July 3, 2025. The previous deadline had been March 7, 2025. Effective March 6, this General License replaces GL 5Q.

With this revised General License, U.S. persons remain prohibited from engaging in any transactions related to the sale or transfer of CITGO shares in connection with the PdVSA 2020 8.5% Bond unless specifically authorized by OFAC. In FAQ 595, OFAC continues to note a favorable licensing policy toward those seeking to apply for a specific license in an effort to reach an agreement on proposals to “restructure or refinance payments due to the holders of the PdVSA 2020 8.5% bond.” 

President Donald Trump issued two executive orders (“EOs”) on March 6, 2025 delaying the 25% tariffs imposed against imports of products of Canada and Mexico (10% tariffs for imports of energy products of Canada) pursuant to the International Emergency Economic Powers Act (“IEEPA”) until April 2, 2025.  The EOs specifically provide that goods qualifying and entered for preferential treatment under the United States-Mexico-Canada Agreement (“USMCA”), as provided in General Note 11 of the Harmonized Tariffs Schedule of the United States (“HTSUS”), will not be subject to the previously issued IEEPA tariffs until April 2, 2025.  The EOs apply to all such goods entered on or after 12:01 a.m. Eastern Standard Time on March 7, 2025.   As a result:

  1. USMCA-qualifying goods will not be subject to the additional IEEPA tariffs at the time of entry from March 7, 2025 through April 2, 2025.   
  2. USMCA-originating goods entered from March 4, 2025 through March 6, 2025 (i.e., three days) remain subject to the IEEPA tariffs. 
  3. All goods that do not meet the USMCA requirements will remain subject to the IEEPA tariffs from March 4, 2025. 
  4. Additionally, IEEPA tariffs on non-USMCA originating potash, a product typically used in fertilizer production, will be reduced to 10% effective March 7, 2025.  

The EOs and White House Fact Sheets can be found here: Amendment to Duties to Address the Flow of Illicit Drugs Across Our Northern Border – The White House; Amendment to Duties to Address the Flow of Illicit Drugs Across Our Southern Border – The White House; and Fact Sheet;  and President Donald J. Trump Adjusts Tariffs on Canada and Mexico to Minimize Disruption to the Automotive Industry .

The EOs indicate that the suspension until April 2, 2025 serves “to minimize disruption to the United States automotive industry,” which they describe as “a major source of United States employment and innovation and is integral to United States economic and national security.”  While the automotive sector is cited as the rationale, the delay until April 2, 2025 applies to all USMCA-qualifying goods.

For non-originating USMCA goods, the IEEPA tariffs on Canada, EO 14193 (Feb. 1, 2025), remain a 10% ad valorem tariff on all non-USMCA-originating energy products of Canada, and a 25% ad valorem tariff on all other non-USMCA-originating products of Canada.  Likewise, IEEP tariffs on Mexico, EO 14194 (Feb. 1, 2025), remain a 25% ad valorem tariff on all non-USMCA-originating products of Mexico.  (For more background information on both EOs, see Update of March 4, 2025.)

Approximately 50% of the imports entering the United States from Mexico and 38% of the imports from Canada claim USMCA preferential treatment.  A significant amount of non-USMCA-originating products from the two countries include energy resources, which typically claim preferential treatment at a later time.  However, the U.S. General Accountability Office (“GAO”) recently determined that $16.5 billion of U.S. imports of automotive vehicles and $53 billion of imports of automotive parts do not claim USMCA preferential treatment — GAO-24-106330, INTERNATIONAL TRADE: USTR Should Improve Coordination on New Automotive Rules of Origin. For automotive vehicles, this is a significant increase from $1.1 billion in the pre-USMCA period, with the overwhelming majority of automotive imports not using USMCA-preferential treatment coming from Mexico.  These goods typically use the 2.5% most favored nation (“MFN”) rate, which must now be added to the IEEPA tariffs.   

The White House has made no announcement as to the status of the Section 232 steel and aluminum tariffs scheduled to enter into effect on March 12, 2025 (with tariffs on new steel and aluminum derivative products to be announced at potentially a later time).   April 2, 2025 marks the planned launch date for President Trump’s broad-based reciprocal tariff plan.

On March 4, 2025, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued General License 41A within its Venezuela-Related Sanctions Program: “Authorizing the Wind Down of Certain Transactions Related to Chevron Corporation’s Joint Ventures in Venezuela.” The Biden Administration had issued the precursor to General License (GL) 41A, GL 41, on November 26, 2022, to permit Chevron Corporation’s joint ventures with Petróleos de Venezuela, S.A. (PdVSA) or any entity owned 50% or more by PdVSA, whether directly or indirectly, to operate in Venezuela. PdVSA is Venezuela’s state-owned oil and natural gas company. (For more background on GL 41, see Thompson Hine Update of November 28, 2022.) OFAC’s issuance of GL 41A comes a few days after President Donald Trump stated his administration would be “reversing the concessions” of GL 41, arguing Venezuela’s leadership has made insufficient progress on reforming the “[e]lectoral conditions within Venezuela” and on “the rapid pace that they had agreed to” accept migrant returns from the United States.

Under the conditions set forth in GL 41A, all transactions “ordinarily incident and necessary to the wind down of transactions” are permissible until 12:01 a.m. eastern daylight time, April 3, 2025. Thereafter, transactions previously authorized under GL 41 will be prohibited.

Key Notes:

  • The USTR issued a determination and report in January 2025 finding that China’s acts, policies, and practices of in the maritime, logistics, and shipbuilding sectors burden or restrict U.S. commerce and are actionable under Section 301 of the Trade Act of 1974.
  • The USTR is proposing actions that could include significant port service fees and restrictions on services to promote the transport of U.S. goods on U.S. vessels.
  • If implemented, such actions would likely lead to higher shipping costs and trigger supply chain disruptions.
  • Public comments on the proposed actions will be accepted until March 24, 2025.

On February 21, 2025, the Office of the U.S. Trade Representative (USTR) announced its proposed actions in response to an earlier determination finding China was targeting the maritime, logistics, and shipbuilding sectors for dominance. This determination followed an investigation under Section 301 of the Trade Act of 1974. This bulletin summarizes the investigation and highlights the proposed actions the USTR is considering submitting to President Donald Trump. 

View the entire client update in HTML or PDF format.

The Trump administration implemented tariffs against Canada and Mexico effective March 4, 2025, arising from declared national emergencies at both the northern and southern U.S. borders pursuant to the International Economic Emergency Powers Act (IEEPA).

Implementation of Tariffs

On March 3, 2025, U.S. Customs and Border Protection (CBP) issued draft Federal Register notices (to be published March 6, 2025): (1) a Notice of Implementation of Additional Duties on Products of Canada Pursuant to the President’s Executive Order 14193, Imposing Duties to Address the Flow of Illicit Drugs Across Our Northern Border; and (2) a Notice of Implementation of Additional Duties on Products of Mexico Pursuant to the President’s Executive Order 14194, Imposing Duties to Address the Situation At Our Southern Border, confirming the implementation of the following IEEPA tariffs, effective March 4, 2025:

  • 10% ad valorem tariffs on energy products of Canada,
  • 25% ad valorem tariffs on other products of Canada, and
  • 25% ad valorem tariffs on products of Mexico.

The IEEPA tariffs are in addition to any other general duties, special duties including antidumping/countervailing duties (AD/CVD), Section 301, Section 232, or other taxes, fees, and charges.

Country of Origin: The country of origin will be determined by the criteria in 19 C.F.R Part 102 and the last place of substantial transformation.  IEEPA tariffs will also apply to products of Canada and Mexico even if they qualify under the United States-Mexico-Canada Agreement (USMCA).

Customs Entries: Effective March 4, 2025, companies must comply with customs entry procedures for these goods using HTSUS codes 9903.01.01-.03 for products of Mexico and 9903.01.10-13  for products of Canada.

FTZs: All goods entering foreign trade zones (FTZs) on or after 12:01 am EST on March 4, 2025, must enter under “privileged foreign status” unless otherwise eligible to enter under “domestic status.”

Drawback: Duty drawback will not be available for products subject to these tariffs imposed under the IEEPA.

De Minimis:TheSection 321 de minimis exemption remains available for eligible articles.

For more information, see CBP messages at the Cargo Systems Messaging Service (CSMS) for Canada and Mexico.

Exclusions from Tariffs

The only articles expressly excluded from the ad valorem duties at this time include:

  • postal, telegraphic, telephonic, or other personal communications, which do not involve a transfer of anything of value;
  • donations, by persons subject to the jurisdiction of the United States, of articles, such as food, clothing, and medicine, intended to be used to relieve human suffering;
  • informational materials, including but not limited to, publications, films, posters, phonograph records, photographs, microfilms, microfiche, tapes, compact disks, CD ROMs, artworks, and news wire feeds; and
  • any transactions ordinarily incident to travel to or from any country, including importation of accompanied baggage for personal use.

HTSUS Chapter 98 “Special Classifications” will continue to apply to potentially exempt certain articles from tariffs except that updated valuation rules will apply. Companies may want to review Chapter 98 to determine potential eligibility.

Retaliatory Tariffs of Canada & Mexico

In response, Prime Minister Justin Trudeau of Canada announced retaliatory tariffs. The first tranche of retaliatory tariffs of roughly CA$33 billion went into effect today (see here). The second tranche of retaliatory tariffs of roughly CA$155 billion is scheduled to go into effect in 21 days (March 25).   

President Claudia Sheinbaum of Mexico began her Tuesday press briefing with a statement criticizing the 25% tariffs. She announced that Mexican officials will be speaking with President Donald Trump on Thursday and warned that if the tariffs remained, Mexico would announce countermeasures, including retaliatory tariffs, on Sunday.

Possible Tariff Relief

U.S. Secretary of Commerce Howard Lutnick indicated that President Donald Trump may announce a compromise with Canada and Mexico on Wednesday, March 5, 2025. In an interview with Fox Business, Lutnick mentioned that both Canadian and Mexican officials had been in discussions with President Trump throughout the day, seeking to address U.S. concerns.

On March 3, 2025, the White House issued an Executive Order to further address the synthetic opioid supply chain in China by increasing the current tariffs on all products of China (and Hong Kong) from 10% to 20%. China immediately responded by announcing that it will implement additional tariffs of up to 15% on key U.S. agricultural products.

Implementation of Tariffs

In order to implement the additional tariffs, on March 3, 2025, U.S. Customs and Border Protection (CBP) has issued draft Federal Register notice (to be published March 6, 2025), Implementation of Additional Duties on Products of the People’s Republic of China Pursuant to the President’s Executive Order 14195, Imposing Duties to Address the Synthetic Opioid Supply Chain in the People’s Republic of China. The same day, CBP published a message via the Cargo Systems Messaging Service (CSMS) providing further clarifications, including the following:

Effective Dates & Rates:

  • From February 4, 2025, to March 3, 2025, goods from China and Hong Kong are subject to an additional 10% duty under HTSUS classification 9903.01.20.
  • Starting on March 4, 2025, the additional duty rate increases to 20% under HTSUS classification 9903.01.24.

These duties apply in addition to all other applicable duties, taxes, fees, exactions and charges. CBP further notes that products of China that are eligible for temporary duty exemptions or reductions will be subject to the additional 20% ad valorem rate of duty.

Exclusions: Certain products are excluded from these additional duties, including donations for human suffering relief, informational materials, and goods in transit before February 1, 2025.

Chapter 98: Goods entered under HTSUS Chapter 98 provisions are generally exempt from these additional duties, except for specific subheadings related to repairs, alterations, or processing performed in China and Hong Kong.

FTZs: Products from China and Hong Kong admitted into U.S. foreign trade zones (FTZs) must be classified under “privileged foreign status” and will be subject to the applicable duties upon entry for consumption.

Drawback: No drawback is available for these additional duties.

De Minimis: The Section 321 de minimis exemption currently remains available for eligible articles.

For prior updates on these recent China tariffs, see Thompson Hine updates of February 5, 2025 and February 3, 2025.

China’s Retaliation

In reaction to the new tariffs imposed by the United States, China announced on March 4, 2025 that it will implement additional tariffs of up to 15% on imports of key U.S. agricultural products, including chicken, wheat, corn, cotton, soybeans, sorghum, pork, beef, aquatic products, fruits, vegetables and dairy products. The tariffs will take effect on March 10, 2025. Goods already in transit will be exempt until April 12, 2025. China also introduced other measures targeting the United States, which include: (1) halting lumber imports from the United States; (2) suspending permits of three U.S. companies for exporting soybeans to China; (3) expanding export controls on certain items in an effort to target a number of U.S. defense contractors, and (4) initiating a circumvention investigation on the existing antidumping duty order on imports of American fiber optic products.

On March 1, 2025, President Donald Trump signed an Executive Order (EO) initiating an investigation under Section 232 of the Trade Expansion Act of 1962 to determine the effects on national security of imports of timber, lumber and their derivative products (including paper products, furniture and cabinetry) dumped into the U.S. market. The EO states that such products are “a critical manufacturing industry essential to the national security, economic strength, and industrial resilience of the United States…. [that plays] a vital role in key downstream civilian industries, including construction.” This action triggers an investigation process that could result in new tariffs if the Trump administration determines that U.S. reliance on suppliers abroad poses a threat to national security.

While acknowledging that the United States has ample timber resources, the EO notes that “[t]he current United States softwood lumber industry has the practical production capacity to supply 95 percent of the United States’ 2024 softwood consumption. Yet, since 2016 the United States has been a net importer of lumber.” The EO also notes that the U.S. military “spends over 10 billion dollars on construction. The military also invests in innovative building material technology, including processes to create innovative wood products.” For this investigation, “timber” refers to wood that has not been processed and “lumber” refers to wood that has been processed, including wood that has been milled and cut into boards or planks.

The Secretary of Commerce will initiate a formal investigation and within 270 days submit a report to President Trump with findings and recommendations on potential actions to mitigate any national security threats. Among the factors the investigation will assess are: (i) the current and projected demand for timber and lumber in the United States; (ii) the role of foreign supply chains, particularly of major exporters, in meeting U.S. timber and lumber demand; (iii) the impact of foreign government subsidies and predatory trade practices on U.S. industry competitiveness; (iv) the feasibility of increasing domestic timber and lumber capacity; and (v) the impact of current trade policies on domestic timber, lumber, and derivative product production, and whether additional measures, including tariffs or quotas, are necessary to protect national security.

While the Section 232 process allows for public comment and hearings, it is unknown at this time whether Secretary of Commerce Howard Lutnick will direct such a process.

The White House issued two Executive Orders on March 2, 2025 amending the February 1, 2025 Executive Orders Imposing Duties to Address the Situation at Our Southern Border and Imposing Duties to Address the Flow of Illicit Drugs Across Our Northern Border (see Thompson Hine Update of February 3, 2025). The March 2 amendments for Mexico and for Canada indicate that products of those two countries using the Section 321 de minimis duty-free exemption (a.k.a., the “$800 rule”) may continue to do so but the exemption will cease to be available upon notice “by the Secretary of Commerce to the President that adequate systems are in place to fully and expeditiously process and collect tariff revenue applicable pursuant to subsection (a) of this section for covered articles otherwise eligible for de minimis treatment.” This language aligns with the amendment made on February 5, 2025 regarding the 10% tariffs imposed on China that followed an outcry from the trade and the United States Postal Service (USPS) among others, that customs clearance processes were not set up to handle the large volumes of de minimis shipments.