Webinar Q&A: US Trade Policy Is Changing Rapidly - and So May Your Job!

Posted by Kelsey Barker

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US-Trade-Webinar-250x250After laying dormant for almost thirty years, US trade policy has been swept up in a whirlwind of change. Last month’s Global Trade Academy webinar explored the pitfalls associated with these trade policy changes and recommended best practices to protect you and your company. You can find this webinar, US Trade Policy Is Changing Rapidly - and So May Your Job! on-demand here.

Global Trade Academy is hosting a second webinar in this regulatory update series tomorrow, July 12, at 2PM: Como está? Zěnmeliǎo? What’s happening? Trade Legislation Changes Around the World – Translated! Tune in to discover how US policy changes are affecting trade legislation around the world.

Viewers came armed with several questions about product classification, Drawback, the exclusion process, and more, and while our presenter Robin Grover answered many of your questions, we ran out of time to address them all. Luckily, Robin has compiled all his answers in this post.  

The following answers to questions posed during the webinar on Trade Policy Changes do not constitute legal advice, either in substance or in form.

Have you heard when will they publish the exclusion process for the 301 List?

By “exclusion process,” I take it you mean one of two things. First, the final list of $34 billion worth of Chinese products subject to U.S. retaliatory tariffs, with others excluded after public hearings and written submissions, can be found at the USTR’s Federal Register Notice of June 20th, 86 F.R. 28710 (check out Annex A).  Reference to the Customs procedure for classifying the Section 301 products under USHTS Chapter 99 can be found on the CBP website under the title: “Section 301 Trade Remedies to be assessed on Certain Products from China, Effective July 6, 2018.”

Can you reclassify the components of a piece of machinery and import them as components vs finished machinery?

I would advise against doing this unless the U.S.-based assembly process would be extensive and expensive. First, General Rule of Interpretation 2a allows U.S. importers to classify a complete set of components, unassembled into the finished article at the time of entry, as the finished article under the HTS. Second, CBP may view this as structuring, an attempt to take illicit advantage of tariff benefits to evade limits that otherwise apply to the assembled product.  I would consult with CBP before moving ahead with plans to import and assemble components in the U.S. and claim that the components would thereby not be subject to the Section 301 tariffs.

I heard drawback is not available for Section 232 covered HTS. Is that true? Do you know if drawback will be unavailable for Section 301 covered HTS too?

The CBP affirms: “No drawback shall be available with respect to the Section 232 duties imposed on any aluminum or steel article.” 

What is the best way to submit comments regarding the proposed "List 2" if unable to attend the hearing?

See Notice by USTR at 86 F.R. 28710 (June 20, 2018). The due date for filing requests to appear and a summary of expected testimony at the public hearing and for filing pre-hearing submissions was June 29th, which is past. The due date for submission of written comments is July 23, 2018, or almost two weeks from today, Wednesday, July 11th. I would stress who you represent, what they produce, and how they will be affected, positively or negatively, by retaliatory tariffs on the products at issue. The important thing is to make your point succinctly and with clarity, and thereby obtain either the inclusion or exclusion of one of the listed products from China. All submissions must be in English and sent electronically via www.regulations.gov. To submit comments via www.regulations.gov,enter docket number USTR–2018–0018 on the home page and click “search.”

What about a retail goods package that contains some items under & some not under 301 scope?

I haven’t seen any official guidance on this issue, but I presume CBP treatment of such “mixed” imports would operate the same way as it does with antidumping or countervailing duties that apply to only one item in a mixed package of products entered together.  I would be wary, however, if you qualified the mixed package a set or kit under GRI 3(b) and one of the items is a covered product from China that yields the qualified set’s essential character and thereby, the set’s USHTS classification.  

Are countries covered by GSP privileges exempt from 232 Import Tariff?

The CBP has stated: “GSP and AGOA-eligible goods that are subject to Section 232 duties or quotas may not receive GSP or AGOA duty preference in accordance with 19 USC 2463(b)(2)On imports subject to Section 232 duties or quotas (including imports from Argentina and Brazil), in addition to any applicable Section 232 duties, importers should pay the normal trade relations (column 1) duty rates and not submit the GSP Special Program Indicator (SPI) “A” or the AGOA SPI “D”.

Do you think that we will be negotiating separately with Canada and with Mexico? Can that be good or not effective to the US?

I suspect that this negotiating tactic has been tried and it was a serious consideration.  Prior to the election of the new president in Mexico on July 1st, the winning candidate ruled out any change to NAFTA.  After his election, however, he invited the US President to meet him later this year, presumably to focus on NAFTA, among other issues.  He is cognizant of the fact that 82 percent of Mexico’s exports go to the United States, so I assume Obrador will provide some leeway on automotive parts and other items to keep NAFTA in effect.    

You can find this webinar, US Trade Policy Is Changing Rapidly - and So May Your Job! on-demand here.

Global Trade Academy is hosting a second webinar in this regulatory update series tomorrow, July 12, at 2PM: Como está? Zěnmeliǎo? What’s happening? Trade Legislation Changes Around the World – Translated! Tune in to discover how US policy changes are affecting trade legislation around the world.

Robin W. Grover is an international trade lawyer with over 30 years experience handling all aspects of export-import issues. With an office in Washington, D.C., Robin is a member of the U.S. Court of International Trade and has represented clients before the U.S. Customs Service, Bureau of Industry and Security (formerly the Bureau of Export Administration), Office of Foreign Assets Control, Directorate of Defense Trade Controls, Office of the U.S. Trade Representative, U.S. International Trade Commission and Census Bureau.

Robin is a consultant and instructor for both Amber Road’s Advisory services and Amber Road’s Global trade Academy of East Rutherford, New Jersey, he is also a licensed customs broker. A graduate of the University of Virginia School of Law and Dickinson College, he is a member of Phi Beta Kappa and is also the World Champion of The History Channel, where he won a then-record shattering $ 263,000, at the time the world record for winnings on a cable television game show. He has taught courses on Exporting, Importing, HTS Classification, Letters of Credit, International Transportation and Logistics and prepared many for the customs broker license exam. Robin lives in Alexandria, Virginia where he dabbles at running marathons, biking and collecting Revolutionary War militaria and Medieval European artifacts.

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This post was published on July 11, 2018 and updated on July 11, 2018.

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Topics: Webinars, Amber Road News, Export Violations

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