DW-China Trade Update (30th Edition)
USTR Considers Removing Additional Duties for Medical-Care Products from Section 301 Tariffs to Address the Covid-19 Outbreak.
Due to the outbreak of Covid-19 across the United States, health-related products, such as ventilators, oxygen masks, etc. are in urgent need. The United States government has prioritized health considerations and is taking actions to ensure that critical medicines and other essential medical products are in sufficient supply to support the national fight against the coronavirus pandemic.
In our previous Update, we suggested that the White House jump-start the economy by reconsidering the 301 Trade policy directed as China, especially in light of the fact that many of the sorely needed supplies are currently manufactured in China. While other trade organizations, such as the National Retail Federation have now made similar suggestions, the U.S. President has not indicate any intention to re-think his strategy in any ways that might gain attention.
Nonetheless, the Administration has more discretely taken actions to test the waters on some part of this approach. On Friday the U.S. Customs and Border Protection issued a notice that it “will approve on a case by case basis additional days for payment of estimated duties, taxes and fees due to the emergency” (that being the COVID-19 response). This partial tariff relief sparked outrage from traditional trade advocates, like the American Iron and Steel Institute. Next, perhaps even more significantly, the Administration, through the Office of the U.S. Trade Representative (USTR), in consultation with the Department of Health and Human Services (HHS), has prioritized the review of exclusion requests related to medical-care products in order to facilitate the U.S. response to COVID-19, and granted approximately 200 separate exclusions on March 10, 2020, March 16, 2020, and March 17, 2020. The exclusions covered personal protective equipment products and other medical-care related products, which are classified under the third and fourth list of Section 301 tariffs.
尽管如此，美国政府已经采取了一些关税方面的行动，来测试这种做法的效果。上周五，美国海关与边境保护局发布通知，称其 "因紧急状况, 逐个批准延长支付关税、税款和费用的天数" (这里的紧急状况指的是为了应对新冠疫情)。该关税举措引发了美国钢铁协会等传统贸易倡导者的愤怒。紧接着，或许更为重要的，美国政府通过美国贸易代表办公室，与美国卫生及公共服务部协商之后，已将与医疗保健产品有关的关税豁免申请的审查作为优先考虑，以便于美国应对新冠疫情，并在2020年3月10日，2020年3月16日和2020年3月17日批准了大约200个产品的关税豁免申请。这些批准的豁免申请包括了属于301条款关税下的第三和第四个清单中个人防护产品和其他医疗相关产品。
This week, the U.S. Trade Representative (USTR) is taking further action to respond to the COVID-19 outbreak and it is now considering removing Section 301 duties from additional medical-care products from China. USTR's action covers medical-related products that are currently subject to any of the tranches of the Section 301 tariffs. While quietly introduced, this shift is significant and means that even if a company’s previously submitted exclusion request is pending or was even already denied, the company may still be eligible to submit a new request for exclusion. Submissions are limited to comments on products subject to the Section 301 tariff actions and relevant to the medical response to the coronavirus.
Specifically, USTR has opened a public docket through www.regulations.gov and invited interested parties to submit comments with respect to whether a particular product covered in any of the Section 301 tariff tranches is needed to respond to the COVID-19 outbreak. If your product is directly used to treat COVID-19 or to limit the outbreak, and/or is used in the production of needed-medical-care products, and it is currently subject to a Section 301 tariffs, you may request USTR to consider a tariff exclusion for your product.
The docket for submitting a comment for product exclusion will remain open until June 25, 2020 and it may be extended as appropriate, according to USTR. USTR will review comments on a rolling basis.
If you believe that your products relate to medical response to the COVID-19 and you would like to find out if it is eligible for a tariff exclusion under USTR's current action, please contact us immediately to get started.
Dickinson Wright Law Firm
About Mark: Mark Heusel is an experienced commercial business attorney and serves as the Chair of the Firm’s China Practice Group. He has more than 25 years of experience in representing multi-national companies in the manufacturing, retail and automotive industries. Mr. Heusel’s experience includes advising foreign companies in the areas of foreign direct investment in the United States, business formation, Greenfield investment, international trade, commercial transactional matters, and dispute resolution. In his role as International Practice Group Chair, he serves as general counsel to companies throughout Asia and Europe, directing the firm’s resources to better assist his clients.
Mr. Heusel began his legal career by representing clients in a variety of litigation matters in state and federal courts and in various domestic and international arbitral forums. With more than 20 years of litigation experience, particularly in the areas of contract disputes, supply chain litigation, employment matters (including discrimination and wrongful discharge litigation), commission disputes, personal injury, and real estate and land use litigation, he gained invaluable first-chair experience in understanding and recognizing how a company’s success may be impacted by business disputes. Leveraging this experience, Mr. Heusel focused his career on assisting foreign companies entering the North American market. His interests and passion for helping companies in a proactive manner led to his current position as International Practice Group Chair, where he now has the opportunity to advise and counsel clients entering or expanding their businesses in North America.