On October 7, 2019, the U.S. Department of Commerce’s Bureau of Industry and Security (BIS) announced that it would add twenty eight (28) Chinese entities consisting of companies, government offices, and security bureaus to the Entity List for engaging in or enabling activities contrary to U.S. foreign policy interests.  Similar to the actions taken against China’s Huawei in May 2019, the End-User Review Committee (ERC) has determined it necessary to impose sanctions on the 28 Chinese based entities, which includes twenty (20) government agencies and eight (8) artificial intelligence companies, due to China’s treatment of the people of the Xinjiang Uighur Autonomous Region (XUAR).  The full list of entities is available here.

The Entity List designation will restrict the listed organizations from buying any U.S. products and importing U.S. technology.  Additionally, U.S. Commerce Secretary Wilbur Ross stated that any U.S. suppliers that seek to continue business with the listed companies would need to obtain a specific license from BIS.  Furthermore, BIS has set forth licensing policies that vary from entity to entity and differ according to the relevant Export Control Classification Number (ECCN) of the exported item.

In its press release, the Commerce Department stated that, “these entities have been implicated in human rights violations and abuses in the implementation of China’s campaign of repression, mass arbitrary detention, and high technology surveillance against Uighurs, Kazakhs, and other members of Muslim minority groups in the XUAR.”  This announcement comes just days before the U.S. and China delegations are scheduled to meet in Washington to continue talks related to the ongoing tariffs.

Husch Blackwell’s Export Controls & Economic Sanctions Team is monitoring this situation closely.  Please contact Cortney Morgan or Grant Leach should you have any questions concerning the recent additions to the BIS Entity List or associated implications for U.S. and non-U.S. businesses.

In Husch Blackwell’s September 2019 Trade Newsletter you’ll find international trade and supply chain updates including presidential actions, U.S. Department of Commerce Decisions, U.S. International Trade Commission Proceedings, U.S. Customs & Border Protection Decisions, Court of International Trade Decisions, Federal Court of Appeals Decisions, and Export Controls and Sanctions.

If you have questions about September’s trade law update, please contact a member of Husch Blackwell’s International Trade and Supply Chain team.

On October 2, 2019, the World Trade Organization (WTO) Arbitrator ruled in favor of the United States and Boeing in its dispute against the European Union and Airbus on the subsidies provided by the E.U. to Airbus. The ruling permits the U.S. to levy retaliatory tariffs on approximately $7.5 billion worth of European exports to the United States. In its decision, the Arbitrator determined that the adverse effects of the E.U.’s Airbus subsidies amounted to approximately $7.5 billion per year.  The Arbitrator also found that the E.U. had not demonstrated that the U.S. failed to follow WTO principles in its challenge leading to the decision against Airbus.

The U.S. Trade Representative (USTR) has prepared a list of European goods valued at over $20 billion that could be subjected to tariffs. The full list of products can be viewed from the USTR’s website. The E.U. has also prepared tariff countermeasures of its own. Under WTO rules, the U.S. and E.U. may levy tariffs not only on aircraft parts, but on a variety of products, including food, alcohol, and motorcycles. The USTR intends to impose a ten percent duty on imports of large civil aircraft and a twenty-five percent duty on agricultural and other products.

According to the Wall Street Journal, a senior USTR official has stated that the tariffs will go into effect on October 18, 2019. The WTO’s Dispute Settlement Body is scheduled to convene on October 28, 2019 and the DSB has to approve the decision, though the U.S. has requested an earlier meeting for October 14 to authorize the retaliatory action. The WTO is not scheduled to make a decision on the E.U.’s complaint against Boeing until 2020. European diplomats have suggested that any American import duties imposed would make E.U. retaliation much more likely, causing potentially severe disruptions within supply chains.

We will continue to monitor this situation and will provide future updates as developments occur. Please contact Husch Blackwell’s International Trade and Supply Chain team for more information.

 

On September 30, 2019, the Office of the U.S. Trade Representative (USTR) issued a Federal Register Notice announcing two new sets of product exclusions for Section 301 tariffs on goods from China.  The newly granted exclusions cover 92 product exclusions from the first tranche of Section 301 tariffs, which went into effect on July 6, 2018.  The second set of granted exclusions cover 111 product exclusions from the second tranche, which went into effect on August 23, 2018. The exclusions from the first tranche mostly cover certain machinery, while the second tranche exclusions cover electrical components, such as certain electric motors, conductors, and copper wire.  Importers and those affected by these tariffs are encouraged to review these lists and contact counsel should they require any additional clarification. The new exclusions will apply for one year from the date of publication on the Federal Register of the granted exclusion requests.

We will continue to monitor this situation and will provide future updates as developments occur. Please contact Husch Blackwell’s International Trade and Supply Chain team for more information.

On September 25, 2019, the U.S. Trade Representative (USTR) announced a new bilateral trade deal between the U.S. and Japan. According to the Office of the USTR, Japan will reduce or eliminate tariffs for certain American agricultural goods, while the U.S. will reduce or eliminate tariffs for certain agricultural imports from Japan. American agricultural goods affected by the deal include beef and pork, wheat and barley, certain nuts and berries, wine, and ethanol, among other miscellaneous agricultural goods. Among Japanese agricultural goods affected are certain plants and flowers, green tea, chewing gum, and soy sauce. The U.S. will also reduce or eliminate tariffs on certain Japanese industrial goods, including certain machine tools, bicycles and bicycle parts, steam turbines, fasteners, and musical instruments.

Additionally, the two countries have agreed to a set of provisions addressing digital trade, ensuring non-discrimination of digital goods and services and prohibiting data localization requirements, allowing barrier-free cross-border data transfers. Conspicuously absent from the U.S.-Japan Trade Agreement is any discussion of the removal of auto tariffs on Japanese cars imported by the US.

We will continue to monitor this situation and will provide future updates as developments occur. Please contact Husch Blackwell’s International Trade and Supply Chain team for more information.

On September 25, 2019, Petitioner American Glass Packaging Coalition filed a petition for the imposition of antidumping and countervailing duties on imports of Certain Glass Containers from the People’s Republic of China.

SCOPE OF THE INVESTIGATION

The merchandise covered by this investigation are certain glass containers with a nominal capacity of 0.059 liters (2.0 fluid ounces) to 4.0 liters (135.256 fluid ounces) and an opening or mouth with a nominal outer diameter of 14 millimeters to 120 millimeters. The scope includes glass jars, bottles, flasks and similar containers; with or without their closures; whether clear or colored; and with or without, design or functional enhancements (including, but not limited to, handles, embossing, labeling, or etching).

Excluded from the scope of the investigation are: (1) Glass containers made of borosilicate glass, meeting United States Pharmacopeia requirements for Type 1 pharmaceutical containers; (2) Glass containers produced by free blown’ method or otherwise without the use of a mold (i.e., without ‘mold seems’, ‘joint marks’, or ‘parting lines ‘); and (3) Glass containers without a ‘finish’ (i.e., the section of a container at the opening including the lip and ring or collar, threaded or otherwise compatible with a type of closure , including but not limited to a lid, cap, or cork).

Glass containers subject to this investigation are specified within the Harmonized Tariff Schedule of the United States (HTSUS) under subheadings 7010.90.5009, 7010.90.5019, 7010.90.5029, 7010.90.5039, 7010.90.5049, 7010.90.5055, 7010.90.5005, 7010.90.5015, 7010.90.5025, 7010.90.5035, and 7010.90.5045. The HTSUS subheadings are provided for convenience and customs purposes only. The written description of the scope of the investigations is dispositive.

PETITIONER

Anchor Glass Container Corporation

401 East Jackson Street, Suite 1100

Tampa, FL 33602

(812) 884-0000

Sam Hijab, VP and General Counsel

 

Ardagh Glass Inc.

8770 W Bryn Mawr Avenue

Chicago, IL 60631-3542

(773) 399-3000

Joshua R. Markus, General Counsel

COUNSEL FOR PETITIONERS

Daniel B. Pickard

Wiley Rein LLP

1776 K Street, NW

Washington, DC 20006

NAMED PRODUCERS/EXPORTERS

For a list of foreign producers/exporters alleged by Petitioner, please see Attachment 1.

NAMED IMPORTERS

For a list of importers alleged by Petitioner, please see Attachment 2.

ESTIMATED SCHEDULE

Event Earliest Date
Petition Filed September 25, 2019
DOC Initiation October 15, 2019
ITC Preliminary Investigation:
Questionnaires Due October 9, 2019
Request to appear at hearing October 14, 2019
Hearing October 16, 2019
Briefs October 21, 2019
ITC Vote November 9, 2019
DOC Preliminary Antidumping Determination March 3, 2020
DOC Preliminary CVD Determination December 19, 2019
DOC Final Antidumping Determination March 19, 2020
DOC Final CVD Determination March 3, 2020
ITC Final Determination July 3, 2020

 

ALLEGED DUMPING MARGIN

People’s Republic of China:

Alleged Dumping Margin: 264.13% – 818.57%

ALLEGED SUBSIDIES

For a list of alleged countervailing duty programs, please see Attachment 3.

IMPORTS OF SUBJECT MERCHANDISE

 

2016 2017 2018 2018 Jan-Jun 2019 Jan-Jun
China
Quantity (1,000 gross) 11,014 12,566 14,232 7,215 6,154
Value ($1,000) 350,237 400,831 452,867 225,566 215,502
AUV ($/unit) 31.8 31.9 31.8 31.3 35

 

CONTACT US

For more information concerning this petition and how it may affect your business, please contact Jeffrey Neeley, Nithya Nagarajan, or Stephen Brophy.

On Wednesday, September 11, 2019, President Donald Trump posed an unexpected tweet that the United States would be delaying the implementation of the tariff increase from October 1, 2019 to October 15, 2019 as a “gesture of good will” towards China. Originally, President Trump had planned to increase the current 25% tariff rate on $250 billion worth of Chinese goods to 30%. To see previous post on the initial announcement, click here.

The announcement of the two week delay came just hours after China had stated that they would exempt 16 types of U.S. products from the imposition of tariffs upon importation into China. Currently, China’s retaliatory tariffs are supposed to go into effect on September 17, 2019. To see the list of products that China has temporarily exempted, click here. The two sides are scheduled to resume trade talks next month in Washington, DC.

We will continue to monitor this situation and will provide future updates as developments occur. Please contact Husch Blackwell’s International Trade and Supply Chain team for more information.

 

 

BIS Extends Huawei Temporary General License with Major Changes and Adds New Affiliates to Entity List

In May of 2019, the US Department of Commerce’s Bureau of Industry and Security (“BIS”) added Chinese telecommunications giant Huawei Technologies Co. Ltd. (“Huawei”) and sixty-eight of its affiliated companies to BIS’s Entity List.  These designations prohibit anyone, anywhere in the world from exporting, re-exporting or making an in-country transfer of “items subject to the EAR” to the listed Huawei Companies (“Items subject to the EAR” generally consist of US-origin commodities, software or technology, items produced outside the US which include qualifying US-origin content and items that are physically present in or transiting through the US).  Shortly after making these designations, BIS issued a Temporary General License which authorized limited ongoing transactions with Huawei to support existing networks and Huawei equipment and handsets. To see the full post on this issue, click here.

This post was published by Husch Blackwell in the monthly Trade Law Newsletter. To read the full August Trade Law Update click here.

Court of International Trade

Summary of Decisions

19-99

On August 1, 2019, the CIT remanded Commerce’s remand redetermination in the administrative review of carbon and certain alloy steel wire rod from Mexico. The court found that Commerce’s remand results did not comply with the court’s order and the decision by Commerce to apply a 40.52% AFA-rate to Plaintiff Deacero is unsupported by substantial evidence.

19-100

On August 1, 2019, the court sustained Commerce’s remand redetermination in the first administrative review of steel concrete reinforcing bar from Mexico. The CIT found that Commerce’s decision not to collapse six non-producing fixed asset owning companies on remand complied with the court’s order and was supported by substantial evidence. Additionally, Commerce’s reliance on the cost experiences of the collapsed fixed asset owners to value the non-collapsed companies and decision not to apply total or partial facts available with an adverse inference to the respondent were sustained.

Continue Reading August Trade Law Update: Court Decisions

Section 701/731 Proceedings

Investigations

  • Magnesium from Israel: On August 5, 2019, the ITC released the schedule of the final phase of Countervailing Duty and Antidumping Duty Investigations.
  • Fresh Tomatoes from Mexico: On August 7, 2019, the ITC released the schedule of the final phase of the Antidumping Duty Investigation.
  • Steel Propane Cylinders from the People’s Republic of China and Thailand: On August 9, 2019, the ITC released the final determinations for both the Antidumping Duty and Countervailing Duty Investigations.
  • Vertical Metal File Cabinets from the People’s Republic of China: On August 21, 2019, the ITC released the schedule of the final phase of the Countervailing Duty and Antidumping Duty Investigations.
  • Glycine from Thailand: On August 21, 2019, the ITC announced in its final determination that it would be terminating the Countervailing Duty Investigation.
  • Glycine from Thailand: On August 23, 2019, the ITC announced the final schedule of the final phase of the Antidumping Duty Investigation.
  • Acetone from Belgium, Korea, Singapore, South Africa, and Spain: On August 26, 2019, the ITC released the schedule of the final phase of the Antidumping Duty Investigation.
  • Carbon and Alloy Steel Threaded Rod from the People’s Republic of China, India, Taiwan, and Thailand: On August 27, 2019, the ITC released the schedule of the final phase of the Countervailing Duty and Antidumping Duty Investigations.
  • Steel Trailer Wheels from the People’s Republic of China: On August 28, 2019, the ITC announced in its final determination that imports of the subject merchandise have caused material injury to a U.S. industry.

Continue Reading August Trade Law Update: U.S. International Trade Commission