U.S. Commerce Department Removes Section 232 Metals Tariff Exemptions
As S&P Platts reported, on December 9 the U.S. Commerce Department announced that it has removed 30 steel and aluminum product types from its list of general approved exclusions (GAE). This decision would once again subject these items to Section 232 duties. (Following the removals, the GAE list now includes 93 items.) The penalties will start being assessed December 27, 2021.
The GAE designation grants a blanket tariff exemption for specific products if previous exclusion requests for the subject products did not receive objections and if such a blanket exemption was warranted for all importers. The decision comes after the department conducted additional analysis on the Section 232 exclusion request submissions. Based on that analysis, the Commerce Department determined that a subset of the GAEs no longer meet the criteria for inclusion as a GAE and should therefore be removed.
As S&P Platts explained, the 232 steel and aluminum tariffs imposed by the Trump administration in 2018 “allowed importers to request that certain shipments be excluded from the tariffs, on a case-by-case basis, if the subject items were not produced in the U.S. in sufficient quantity or quality or for national security considerations.” The Commerce Department then established the GAE list on December 14, 2020 in an effort to improve the efficiency of the exclusion request process. Under that process, importers are not required to file individual exclusion requests for GAE items.
Read the Commerce Department’s announcement here.
MSCI is reporting this news for members’ information only. As a reminder, MSCI consistently has argued that global overcapacity and other unfair trading practices, particularly by China, have harmed the U.S. steel and aluminum markets. To address this circumvention, in 2017 MSCI advised federal officials to provide relief for producers up and down the supply chain and to consider the consequences of any new trade policy, including: the economic impact of global overcapacity on the entire domestic metals supply chain; transition times and implementation rules to any new policy; availability of domestic metals to meet U.S. national security needs, as well as general industrial and consumer demand; and trade flows under current free trade agreements, including the United States Mexico Canada Agreement (USMCA). MSCI also asked that Canada and Mexico be excluded from any trade penalties.
Click here to review all of MSCI’s advocacy on Section 232 tariffs.