World Wide Tax News Issue 53 - December 2019

Tariffs: List 4A exclusion process opened on 31 October 2019

On 24 October 2019, the United States Trade Representative (USTR) published a Federal Register notice announcing that the electronic portal for submission of requests to exclude particular products from List 1 of the fourth tranche (List 4A) of Section 301 tariffs would open on 31 October 2019. List 4A imposes additional 15% tariffs on products imported from China effective 1 September 2019. The published notice can be read here.

Product exclusions must be submitted through the new online portal at http://exclusions.ustr.gov, which opened at noon EDT on 31 October, with a final deadline of 31 January 2020. Parties supporting or objecting to such exclusion requests must file responses no later than 14 days after the request is posted on the portal. Any replies to those responses will be due seven days after the close of the 14-day period, or seven days after the posting of a response on the portal, whichever is later.
The List 4A exclusion form is substantially similar to the one provided for List 3 products. In addition, the new portal also requires the following information and data points that were not included in the previous exclusion request form:

  • The requestor’s import and revenue data for the first half of 2019 instead of the first quarter of 2019.
  • Whether the product is subject to an antidumping or countervailing duty order issued by the U.S. Department of Commerce.

With respect to the rationale for the requested exclusion, USTR will require similar information to that included in the Lists 1, 2 and 3 criteria:

  • Whether the particular product is available only from China or can be sourced from the United States or third countries.
  • Whether the requestor has attempted to source the product from the United States or third countries.
  • Whether the imposition of additional duties has caused or will cause severe economic harm to the requestor.
  • Whether the particular product is strategically important to the “Made in China 2025” initiative or other Chinese industrial programs.

If a product exclusion petition is granted by USTR, exclusions and corresponding refunds of the 15% duties will be retroactive to 1 September 2019, when the List 4A tariffs were first imposed, and any granted exclusions will be valid for one year from the date of publication of the exclusion determination in the Federal Register.

Damon V. Pike

Yun Gao