Section 301 Tariffs Might Extend Beyond China to the EU

On April 12, 2019, the Office of the United States Trade Representative (USTR) published in the Federal Register a notice, Initiation of Investigation; Notice of Hearing and Request for Public Comments: Enforcement of U.S. WTO Rights in Large Civil Aircraft Dispute.1

The investigation could lead to the U.S. imposing tariffs on new, non-military helicopters, fuselages, undercarriages and civil aircraft parts from France, Germany, Spain and the UK, as well as a broad range of consumer goods from the European Union (EU), under Section 301 of the Trade Act of 1974.2 Over the past year, attention to Section 301 tariffs has focused on 25 percent and 10 percent rates imposed on goods of Chinese-origin in response to USTR’s 2018 findings on China’s acts, policies and practices relating to technology transfers and intellectual property.3

The USTR investigation results from World Trade Organization (WTO) dispute proceedings between the U.S. and EU over alleged subsidies granted to Boeing by the U.S. and to Airbus by the EU and certain member States. The WTO dispute began in 2004 and is ongoing. Section 302(b) of the Trade Act authorizes USTR to conduct such an investigation to determine whether there is conduct actionable under Section 301 of the Trade Act. Such actionable activity includes the denial of U.S. rights under any trade agreement, including the WTO Agreement.

USTR has proposed Section 301 tariffs at unspecified rates as countermeasures to alleged EU and certain member State breaches of their WTO obligations in connection with the WTO dispute proceedings. The proposed tariffs would be imposed on approximately USD 11 billion of imported goods from the EU and member States Germany, France, Spain and the UK. The proposed Section 301 tariffs would be imposed on consumer products ranging from seafood, jams, wines, and cheeses and other dairy products to handbags, carpets, men’s and boys’ suits, sweaters, women’s and girls’ swimwear, bed linens, motorcycles and bicycles (including parts). The proposed list also includes optics articles such as unmounted prisms, lenses used in CCTV cameras and other applications, binoculars, and sights used for rifles and other arms. Some industrial products and materials are included as well, such as self-propelled backhoes, certain copper-based alloys, and pneumatic hand-tools.

The Section 301 Committee will hold a public hearing on May 15, 2019, and requests to appear are due May 6. Businesses and consumers have until May 28, 2019 to submit written comments to USTR. Submissions can be filed electronically at www.regulations.gov, Docket No. USTR-2019-0003.

Additional Assistance

For questions, assistance in preparing and filing comments, or to discuss other international trade matters, please contact Jon P. Yormick, Special Counsel, at (216) 928-3474, (716) 847-7006, (585) 238-2000 x7006 or jyormick@phillipslytle.com.

  1. 84 FR 15028 (April 12, 2019).
  2. Trade Act of 1974.
  3. USTR Findings of the Investigation into China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation under Section 301 of the Trade Act of 1974 (March 22, 2018).