ANNOUNCEMENT 22 Jul 2019

The law allows actions that may be discriminatory in support of products that receive this designation.

 

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising
Inception date: 22 Jul 2019 | Removal date: open ended

Public procurement localisation

In a memorandum to the secretary of defense on July 22, 2019, President Trump determined, pursuant the Defense Production Act of 1950, that “domestic production capability for Neodymium Iron Boron Rare Earth Sintered Material and Permanent Magnets is essential to the national defense.” More precisely,

Without Presidential action under section 303 of the Act, United States industry cannot reasonably be expected to provide the production capability for Neodymium Iron Boron Rare Earth Sintered Material and Permanent Magnets adequately and in a timely manner. Further, purchases, purchase commitments, or other action pursuant to section 303 of the Act are the most cost-effective, expedient, and practical alternative method for meeting the need for this critical capability.

This is one of a series of such orders that the president signed that same day on a range of related products, each of which fall within the general category of rare earths and their products. Rare earths consist of seventeen metallic elements that include the fifteen lanthanides on the periodic table of the elements, plus scandium and yttrium. These goods are considered vital to many modern technologies, including (among others) national defense, consumer electronics, computers, and communications.

The relevant section of the Defense Production Act of 1950 grants the president an array of authorities. It provides that “[t]o create, maintain, protect, expand, or restore domestic industrial base capabilities essential for the national defense, the President may make provision” as follows:

(A) for purchases of or commitments to purchase an industrial resource or a critical technology item, for Government use or resale;

(B) for the encouragement of exploration, development, and mining of critical and strategic materials, and other materials;

(C) for the development of production capabilities; and

(D) for the increased use of emerging technologies in security program applications and the rapid transition of emerging technologies —

(i) from Government-sponsored research and development to commercial applications; and

(ii) from commercial research and development to national defense applications.

AFFECTED SECTORS

 

AFFECTED PRODUCTS