ANNOUNCED AS TEMPORARYNo
On July 11, 2018 the Office of the U.S. Trade Representative (USTR) published an additional list of items that may be subject to retaliatory tariffs in this dispute. Noting that China had retaliated against the U.S. retaliatory measures "by imposing tariffs on $34 billion in U.S. exports to China, and threatening tariffs on another $16 billion ... without any international legal basis or justification," the USTR stated that -
As a result of China’s retaliation and failure to change its practices, the President has ordered USTR to begin the process of imposing tariffs of 10 percent on an additional $200 billion of Chinese imports. This is an appropriate response under the authority of Section 301 to obtain the elimination of China’s harmful industrial policies. USTR will proceed with a transparent and comprehensive public notice and comment process prior to the imposition of final tariffs, as we have for previous tariffs.
In the same announcement the USTR provided for modifications to the existing retaliatory measures. In the Federal Register notice, the USTR invited "interested persons, including trade associations, to submit requests for exclusion from the additional duties of a particular product," stating that "each request must specifically identify a particular product, and provide supporting data and the rationale for the requested exclusion." More specifically,
USTR will evaluate each request on a case-by-case basis, taking into account whether the exclusion would undermine the objective of the Section 301 investigation. Any exclusion will be effective starting from the July 6, 2018 effective date of the additional duties, and extend for one year after the publication of the exclusion determination in the Federal Register. In other words, an exclusion, if granted, will apply retroactively to the July 6 date of the imposition of the additional duties. USTR periodically will announce decisions on pending requests.
On August 1, 2018 the USTR announced that President Trump directed agency to consider increasing the proposed level of the additional duty from 10% to 25% on a list of $200 billion in products that previously had been announced by USTR on July 10. This threat comes in response to (according to the USTR) China not “changing its harmful behavior” but instead “illegally retaliate[ing] against U.S. workers, farmers, ranchers and businesses.” The USTR says that the potential “increase in the possible rate of the additional duty is intended to provide the Administration with additional options to encourage China to change its harmful policies and behavior and adopt policies that will lead to fairer markets and prosperity for all our citizens.”
The USTR invited interested parties Interested parties to address the possible increased duties in their comments on the proposed action. “In light of the possible increase of the additional duty rate to 25 percent,” the agency observed, “the close of the written comment period is extended from August 30 to September 5, and the due date for requests to appear at the public hearing is extended to August 13. These modifications to the comment period will be set out in a notice to be published shortly in the Federal Register.”
On August 7, 2018 the USTR released a final list of approximately $16 billion worth of imports from China that will be subject to a 25% additional tariff. This second tranche of additional tariffs contains 279 of the original 284 tariff lines that were on a proposed list announced on June 15, and will go into effect on August 23, 2018.