On August 9, 2023, the Biden administration issued a much-anticipated Executive Order establishing a new regime to limit certain U.S. investments in key Chinese technology sectors to prevent the financing of Chinese military advancement. The order, once implemented via regulation, will prohibit U.S. persons from investing in, or engaging in certain other transactions with, Chinese companies engaged in specified conduct involving semiconductors and microelectronics, quantum information technologies, and artificial intelligence. The regulations will likely come into force in 2024 after multiple rounds of public comment, including an initial 45-day comment period that is now underway on an advanced notice of proposed rulemaking (“ANPRM”) issued by the U.S. Department of the Treasury (“Treasury”).

The regulations will prohibit some investments altogether, while others will be subject only to official notification requirements. Treasury, which will implement and enforce the restrictions, stated that it anticipates exempting “certain transactions, including potentially those in publicly traded instruments and intracompany transfers from U.S. parents to subsidiaries.”

Continue Reading Amid Growing Trade Tensions, U.S. Imposes Unprecedented Restrictions on Outbound Investments to China

On October 12, 2022, the Office of the U.S. Trade Representative announced it would be seeking public comments regarding the effectiveness of the actions related to the Section 301 investigation of China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation.  The two specific actions under review are the imposition of additional tariffs under Section 301 on products on List 1 and List 2 (covering $34 billion and $16 million in imports as of 2018, respectively), which were subsequently modified by the imposition of List 3 and List 4A (totaling $325 billion in imports as of 2018).  This notice marks the next step in the USTR’s “review of necessity,” a statutory-mandated four-year review process.  A portal for submitting these comments will open on November 15, 2022, with a deadline of January 17, 2023.
Continue Reading USTR Announces Next Steps in Statutory Four-Year Review of China 301 Tariffs

Since the beginning of the Biden Administration, and particularly since earlier in 2021, U.S. companies and importers have been looking forward to the prospect of a reduction in the tariffs originally imposed in 2018 and 2019 following the Section 301 investigation against China or, at a minimum, a resumption of the exclusion process that was largely suspended in 2020 aside from extensions in limited circumstances.  While several avenues for the elimination or reduction of Section 301 duties have presented themselves, to date, none have been adopted.  Nevertheless, the coming months may offer several opportunities for U.S. companies interested in reducing their Section 301 duty liability to advocate for relief.
Continue Reading Section 301 Duties on Imports from China: Current Status of Prospects for Relief

The Office of the United States Trade Representative (“USTR”) has recently initiated a statutory four-year review of the two actions taken under Section 301 of the Trade Act of 1974, as amended, in the investigation of China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation.  The two specific actions under review are the imposition of additional tariffs under Section 301 on products on List 1(covering $34 billion in imports as of 2018) and List 2 ($16 million in imports), which were subsequently modified by the imposition of List 3 and List 4A.

This “review of necessity” is being conducted pursuant to 19 U.S.C. § 2417(c), which obligates USTR to revoke any action taken under Section 301 after four years unless parties that benefit from that action requests its continuation.  If continuation is requested, USTR is then required to evaluate the “effectiveness in achieving the objectives of Section 301” and the “effects of such actions on the United States economy, including consumers” for any action taken under Section 301.

Continue Reading USTR Starts “Review of Necessity” of Section 301 Tariffs

2022 is shaping up to be a critical year for the Biden Administration regarding U.S. international trade policy.  In 2021, the Biden Administration made headway in resolving some of the challenges with United States’ allies that arose during the last Administration, and trying to build bridges in important regions that had perhaps had been neglected.  But in a number of other critical areas, and arguably in the most significant areas, the Biden Administration made little tangible progress over the past year.  The discussion below offers a look back at the key developments in 2021 with respect to U.S. trade relations with the EU, China, the rest of Asia and North America, and a look ahead at what could come in 2022.

Continue Reading The US International Trade Agenda: A Look Back, A Look Ahead

At the request of the US Senate Finance Committee, the US International Trade Commission (“ITC”) is investigating the trade and economic effects of foreign censorship practices on US businesses under Section 332 of the Trade Act of 1930 (“Section 332”).

A Section 332 investigation is only a fact-finding investigation, and does not itself lead to the imposition of tariffs or other trade restrictive measures.  However, if the ITC concludes at the end of an investigation that certain policies have burdened or restricted US commerce, the ITC’s conclusions could be used as the basis for further trade action, such as under Section 301 of the Trade Act of 1974, which could result in the imposition of restrictions on trade.

Continue Reading The Trade and Economic Effects of Foreign Censorship Studied by the US International Trade Commission

Economists from the Federal Reserve Bank of New York recently published a report analyzing the US-China trade deficit after the imposition of Section 301 tariffs on imports from China in 2018. They concluded that the trade deficit narrowed, but attributed a significant part of this narrowing to duty evasion on the part of Chinese exporters

On January 15, 2021, the Office of the United States Trade Representative (“USTR”) published a report detailing the findings of its investigation under Section 301 of the Trade Act of 1974 (“Section 301”) into Vietnam’s currency policies. The report concludes that “Vietnam’s acts, policies, and practices with respect to currency valuation, including excessive foreign exchange market interventions and other related actions, taken in their totality, are unreasonable and burden or restrict U.S. commerce.”  Although such findings permit USTR to adopt measures, such as tariffs, in response to Vietnam’s policies, USTR has declined to take such action at this time.

Continue Reading USTR Finds Vietnam’s Currency Undervaluation To Be Unreasonable And Burden Or Restrict U.S. Commerce, But Delays Responsive Action

The Office of the United States Trade Representative (USTR) has initiated investigations on two trade-related issues with respect to Vietnam under Section 301 of the Trade Act of 1974 (Section 301). The investigations, which were announced on October 2, 2020, will cover Vietnam’s acts, policies, and practices related to (1) the import and use of