List 3 Exclusion Process Opened June 30, 2019

July 2019

On June 24, 2019, the United States Trade Representative (USTR) announced in a published Federal Register notice that the electronic portal for submission of requests to exclude particular products from the third tranche (List 3) of Section 301 tariffs would open June 30, 2019.  List 3 imposes additional 25 percent tariffs on approximately $200 billion of products imported from China.  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 June 30, with a final deadline of September 30, 2019. 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 new portal will also require information that was not included in the exclusion criteria for products on Lists 1 and 2. In addition to providing the applicable 10-digit HTSUS subheading, product name, specific description and function, and supporting data and rationale for the requested exclusion, requesters must also submit:
 
  • Specific data on the annual quantity and value of the Chinese-origin product, domestic product, and third-country product the requester purchased, in 2017, 2018, and the first quarter of 2019.
  • The requester’s gross revenues for 2018, the first quarter of 2018, and the first quarter of 2019.
  • For imports sold as final products, the requester’s percentage of its total gross sales in 2018 that are accounted for by the sales of the Chinese-origin product.
  • For imports used in the production of final products, the requester’s percentage of the total cost of producing the final product accounted for by the Chinese-origin input and the percentage of their total gross sales in 2019 accounted for by the sales of the final product.  
 
With respect to the rationale for the requested exclusion, USTR will require similar information to that included in the Lists 1 and 2 criteria:
 
  • Whether the particular product is available only from China or can be sourced from the United States or third countries.
  • Whether the requester has attempted to source the product from the United States or third countries.
  • Whether the imposition of additional duties have caused or will cause sever economic harm to the requester.
  • Whether the particular product is a 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 25 percent duties will be retroactive to September 24, 2018 (when the List 3 tariffs were first announced), and any granted exclusions will be valid for one year from the date of publication of the exclusion determination in the Federal Register.
 

For more information, please contact a BDO Customs and International Trade Services professional:
 
Damon V. Pike
Principal
  James Pai
Senior Manager

 
Yun Gao
Manager
  Travis Fournier 
Manager

   
Jay Cho
Manager