USTR Finalizes Action on China Section 301 Tariffs Following Four-Year Review

On September 13, 2024, the Office of the U.S. Trade Representative (USTR) announced in a Federal Register notice the final modifications to its tariff actions in the Section 301 investigation of the China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation after concluding a statutorily mandated four-year review. (For additional information on the USTR’s Four-Year Review Report, see Thompson Hine Update of May 15, 2024.) The modifications largely followed those proposed in May 2024. (For details on the USTR’s original proposed modifications, see Update of May 28, 2024.) In modifying these tariffs, President Joseph Biden directed the USTR to increase tariffs on imports from China in the following sectors: (i) steel and aluminum, (ii) semiconductors, (iii) electric vehicles, (iv) batteries, battery components, and critical minerals, (v) solar cells, (vi) ship-to-shore cranes, and (vii) medical products. The updates include: (i) new timing and rates for tariffs on face masks, medical gloves, needles, and syringes; (ii) an exclusion for enteral syringes; (iii) a proposal regarding coverage of additional tungsten, wafers, and polysilicon tariff lines; (iv) an exclusion for ship-to-shore cranes ordered prior to May 14, 2024; (v) an expansion of the scope of the machinery exclusions process to include five additional tariff lines; and (vi) modification of the coverage of proposed exclusions for solar manufacturing equipment.

Both the original May 2024 modification proposal and the September 13, 2024 notice include an Annex of 14 product groups covering the 382 Harmonized Tariff Schedule of the United States (HTSUS) subheadings and five statistical reporting numbers of the HTSUS affected by the modified China Section 301 tariffs, their tariff rate increases, and their implementation dates. For those with increases in 2024, the duty rate will apply to products entered for consumption, or withdrawn from warehouse for consumption, on or after September 27, 2024. Tariff increases identified for 2025 and 2026 will apply to products entered for consumption, or withdrawn from warehouse for consumption, on or after January 1 of the corresponding year. The new tariff levels and dates of entry into force by product categories are summarized below:

Upon identifying additional product groups for these China Section 301 tariffs, President Biden directed the USTR to establish a product exclusion process for machinery used in domestic manufacturing and to prioritize exclusions for certain solar manufacturing equipment. In the USTR’s September 13, 2024 press release announcing its final actions on China Section 301 tariffs, the agency noted that an exclusion process will be launched “soon” and that it will also be accepting public comments soon for proposed modifications of tariff rates on certain tungsten, wafers, and polysilicon tariff lines.