Trade Representative to Launch E-Filing Portal for Section 301 Exclusion Requests
June 20, 2019
The United States Trade Representative (USTR) published a notice announcing plans to launch a dedicated internet portal for exclusion requests ("requests") for Chinese imports subject to the Third Tranch of Section 301 tariffs ("requested product"). This process is somewhat different from the earlier processes and should be closely reviewed even if companies have filed requests previously.
The portal is scheduled to launch by 12:00pm EDT June 30th, 2019. The deadline for exclusion requests will be September 30th, 2019. Any exclusions granted will be retroactive to September 24th, 2018, which was the date that the duties were imposed.
The form the USTR has created for these requests is similar to, but different from, previous forms. Parties will still need to provide information about themselves and detailed information about the product(s) they are requesting for. The product descriptions should now include not only the tariff number and functions/applications, but also principal uses and distinguishing physical characteristics. This is arguable a higher degree of required specificity than was required previously. In no case will the USTR accept a product description that is Business Confidential.
One new aspect of the Tranche 3 is the level of business information about the requestor that must be provided. This is all marked confidential, but it will still be necessary to submit the company's relationship to the product (e.g. Importer, U.S. Producer, Purchaser, Industry Association, etc.); annual quantity and value data concerning the Chinese-origin product, the domestic product, and any third-country product purchased by the requesting organization in 2017, 2018, and the first fiscal quarter of 2019; gorss revenue information for the 2018 fiscal year, its first fiscal quarter, and that of the first fiscal quarter, 2019 must also be included; if any imported requested product was sold as a final product, the request must include the percentage of total gross sales for 2018 accounted for by the Chinese-origin product; and if the request product was used as an input for final product(s), then the requesting organization must repor the total percentage of the final product(s)' production costs comprised by the requested product during fiscal year 2018, as well as the percentage of total gros sales accounted for by the final product(s) during the same period.
Finally, a ratiionale must be provided for each exclusion request. Request must include a response to the following questions, along with supporting evidence for each response:
- Is the requested product, or a comparable product, available in the United States or from another third country source?
- Have attemptes been made to source the requested product from the United States or from another third country source?
- Has the imposition of additional duties (since September 2018) on the requested product caused severe economic harm to the requesting organization or to other U.S. interests? Will imposition of duties cause such harm in the future?
- Does the requested product hold strategic significance for the "Made in China 2025" or any other Chinese industrial programs?
For more information or for further guidance concerning the Section 301 exclusion process, please contact one of our attorneys.