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Section 301 Trade Remedies to be Assessed on Certain Products from China

Update:  Additional List of Products Subject to Section 301 Remedy

See related CSMS:  18-000409, 18-000419, 18-000493, 18-000498, 18-000554

BACKGROUND

On August 18, 2017, the Office of the United States Trade Representative (USTR) initiated an investigation under Section 301 of the Trade Act of 1974 into the government of China’s acts, policies, and practices related to technology transfer, intellectual property, and innovation.  On June 20, 2018, the USTR published a Notice of Action and Request for Public Comment Concerning Proposed Determination of Action Pursuant to Section 301, imposing additional import duties on a list of Chinese products.  See Federal Register 83 FR 28710. On August 16, 2018, the USTR published a Notice of Action providing for the imposition of additional import duties on a second list of Chinese Products.  The August 16, 2018 list of products covered by the Section 301 remedy, which comprises 279 eight-digit Harmonized Tariff Schedule of the United States (HTSUS) subheadings, can be found in Annex A to the USTR’s August 16, 2018 notice of action.  See Federal Register 83 FR 40823.

On September 21, 2018, the USTR published a Notice of Modification of Action providing for the imposition of additional import duties on a third list of Chinese products. The September 21, 2018 list of products covered by the Section 301 remedy, which comprises over 5,700 full and partial eight-digit Harmonized Tariff Schedule of the United States (HTSUS) subheadings, which can be found in Annex A to the USTR’s September 21, 2018 Notice. See Federal Register 83 FR 47974.

GUIDANCE

Section 301 Remedy HTSUS Reference Guide

Products Covered by the September 21, 2018 List for the Section 301 Action

The additional import duties for Chinese goods covered by the September 21, 2018 list of products subject to the Section 301 action are effective with respect to goods entered, or withdrawn from warehouse for consumption, on or after 12:01 AM eastern daylight time on September 24, 2018.

Any article classified in a subheading covered by the September 21 list that is a product of China is subject to a 10% ad valorem duty rate, in addition to the general (Column 1) rate of duty for that particular subheading.

There are two special tariff numbers that will apply to goods covered by the September 21, 2018 list, 9903.88.03 and 9903.88.04. Heading 9903.88.03 covers all subheadings listed in U.S. note 20(f) to Subchapter III to Chapter 99 (5,734 eight-digit HTSUS subheadings); heading 9903.88.04 covers all subheadings listed in U.S. note 20(g) to Subchapter III to Chapter 99 (11 eight-digit HTSUS subheadings with partial exceptions at the 10-digit level).

In addition to reporting the Chapter 1-97 HTSUS classification of the imported merchandise, importers shall also report the relevant 9903.88.03 or 9903.88.04 special tariff number for goods subject to the additional duty assessment of 10% ad valorem as a result of the Section 301 trade remedy.

9903.88.03: 10% ad valorem additional duty for articles the product of China,… as enumerated in U.S. note 20(f) to Subchapter III to Chapter 99.

9903.88.04: 10% ad valorem additional duty for articles the product of China,… as enumerated in U.S. note 20(g) to Subchapter III to Chapter 99.

Please note that in accordance with Annex B to the September 21, 2018 notice of action, effective 12:01 AM Eastern Standard Time on January 1, 2019, the additional rates of duty imposed by headings 9903.88.03 and 9903.88.04 will increase to 25% ad valorem.

The product descriptions provided in Annex C to the September 21, 2018 notice of action are provided for informational purposes only, and are not legally controlling. The provisions of the relevant HTSUS subheadings listed in Annex A are controlling for the purpose of determining whether a good is subject to the Section 301 remedy.

New Statistical Reporting Number for Subheading 8517.62.00, HTSUS

U.S. note 20(g)(2) to Subchapter III to Chapter 99 indicates that heading 9903.88.04 applies to articles classified in subheading 8517.62.00, except for machines provided for in statistical reporting number 8517.62.0090. 8517.62.0090 is a new statistical reporting number that will be added to the HTSUS on or before September 24, 2018.  For more information, see https://www.usitc.gov/tariff_affairs.htm.

Products Covered by the June 20, 2018 and August 16, 2018 Lists for the Section 301 Action

The instructions for goods covered by the June 20, 2018 and August 16, 2018 lists remain unchanged.

The additional import duties for Chinese goods covered by the June 20, 2018 list were effective with respect to goods entered, or withdrawn from warehouse for consumption, on or after 12:01 AM eastern daylight time on July 6, 2018.

In addition to reporting the Chapters 1-97 HTSUS classification of the imported merchandise, importers shall also report the 9903.88.01 special tariff number for goods subject to the additional duty assessment of 25% ad valorem as a result of the Section 301 trade remedy.

The additional import duties for Chinese goods covered by the August 16, 2018 list were effective with respect to goods entered, or withdrawn from warehouse for consumption, on or after 12:01 AM eastern daylight time on August 23, 2018.

In addition to reporting the Chapter 1-97 HTSUS classification of the imported merchandise, importers shall also report the 9903.88.02 special tariff number for goods subject to the additional duty assessment of 25% ad valorem as a result of the Section 301 trade remedy

Products Covered by the June 20, 2018 List for the Section 301 Action

The additional import duties for Chinese goods covered by the June 20, 2018 list were effective with respect to goods entered, or withdrawn from warehouse for consumption, on or after 12:01 AM Eastern Daylight Time on July 6, 2018.

In addition to reporting the Chapters 1-97 HTSUS classification of the imported merchandise, importers shall also report the 9903.88.01 special tariff number for goods subject to the additional duty assessment of 25% ad valorem as a result of the Section 301 trade remedy.

9903.88.01: 25% ad valorem additional duty for articles the product of China

Products Covered by the August 16, 2018 List for the Section 301 Action

The additional import duties for Chinese goods covered by the August 16, 2018 list of products subject to the Section 301 action are effective with respect to goods entered, or withdrawn from warehouse for consumption, on or after 12:01 AM Eastern Daylight Time on August 23, 2018.

Any article classified in a subheading covered by the August 16 list that is a product of China is subject to a 25% ad valorem duty rate, in addition to the general (Column 1) rate of duty for that particular subheading.

In addition to reporting the Chapter 1-97 HTSUS classification of the imported merchandise, importers shall also report the 9903.88.02 special tariff number for goods subject to the additional duty assessment of 25% ad valorem as a result of the Section 301 trade remedy.

9903.88.02: 25% ad valorem additional duty for articles the product of China

All Products Covered by Section 301 Duties

The Section 301 duties only apply to products of China, and are based on the country of origin, not country of export.

ADDITIONAL INFORMATION

Chapter 98

The additional duties imposed by headings 9903.88.01 through 9903.88.04 do not apply to goods for which entry is properly claimed under a provision of chapter 98 of the HTSUS, except for goods entered under headings 9802.00.40, 9802.00.50, 9802.00.60, and 9802.00.80.  For headings 9802.00.40, 9802.00.50, and 9802.00.60, the additional duties apply to the value of repairs, alterations, or processing performed abroad, as described in the applicable heading. For heading 9802.00.80, the additional duties apply to the value of the article less the cost or value of such products of the United States, as described in heading 9802.00.80.    

Chapter 98 Filing Instructions

When submitting an entry in which a heading or subheading in Chapter 98 is claimed on merchandise covered by the Section 301 remedy, the following instructions will apply.

When submitting an entry using a Chapter 98 provision that normally requires the reporting of a secondary Chapter 1-97 HTSUS classification, a filer must first report subheading 9903.88.01, 9903.88.02, 9903.88.03, or 9903.88.04, as applicable, followed by the applicable Chapter 98 subheading, and the Chapter 1-97 HTSUS classification for the commodity being imported.

When submitting an entry using a Chapter 98 provision that does not normally require the reporting of a secondary Chapter 1-97 HTSUS classification, neither 9903.88.01/02/03/04 nor the Chapter 1-97 HTSUS should be reported.

When submitting an entry for a Temporary Importation under Bond (TIB), a filer must first report the applicable subheading in Chapter 98 (i.e., in heading 9813), followed by subheading 9903.88.01/02/03/04, and the Chapter 1-97 HTSUS for the commodity being imported.

Trade Preference Programs and Temporary Reductions in Rates of Duty

Products of China that are covered by the Section 301 remedy and that are eligible for special tariff treatment under general note 3(c)(i) to the tariff schedule, or that are eligible for temporary duty exemptions or reductions under subchapter II to chapter 99, shall be subject to the additional 25 percent ad valorem rate of duty imposed by headings 9903.88.01 and 9903.88.02, or the additional 10 percent ad valorem rate imposed by heading 9903.88.03 and 9903.88.04.

Foreign Trade Zones

Per the Federal Register Notice published by the USTR, any product listed in Annex A, except any product that is eligible for admission under ‘domestic status’ as defined in 19 CFR 146.43, which is subject to the additional duty imposed by this determination, and that is admitted into a U.S. foreign trade zone on or after 12:01 am eastern daylight time on July 6, 2018, only may be admitted as ‘privileged foreign status’ as defined in 19 CFR 146.41. Such products will be subject upon entry for consumption to any ad valorem rates of duty or quantitative limitations related to the classification under the applicable HTSUS subheading.

Drawback

Section 301 duties are eligible for duty drawback.

FREQUENTLY ASKED QUESTIONS

Frequently asked questions about the Section 301 trade remedies can be found by going to:

https://www.cbp.gov/trade/programs-administration/entry-summary/section-301-trade-remedies/faqs 

FOR FURTHER INFORMATION

For further information, please refer to the USTR’s Notice of Action and Request for Public Comment Concerning Proposed Determination of Action Pursuant to Section 301: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation, 83 FR 28710 (June 20, 2018); and the August 16, 2018 Notice of Action Pursuant to Section 301, 83 FR 40823 (August 16, 2018).
 
Questions related to Section 301 entry filing requirements should be emailed to traderemedy@cbp.dhs.gov. Questions from the importing community concerning ACE rejections should be referred to their Client Representative.
Last modified: 
September 21, 2018