On Tuesday, May 21, 2019, USTR and the Office of Management and Budget (“OMB”) published in the Federal Register a request for comments on the Section 301 exclusion process for Tranche 3 tariffs which were increased from 10% to 25% on May 10, 2019. The notice also included a draft exclusion request form for the List 3 products. The draft exclusion request form includes more data requirements on U.S. and third-party sourcing, overall gross revenue, and on whether the company has applied for and/or received previous exclusion requests.

Interested parties can submit written comments and suggestions on the proposed product exclusion process until June 7, 2019 addressing one or more of the following four points:

(1) Whether the proposed information collection request is necessary for the proper performance of USTR’s functions, including whether the information will have practical utility.

(2) The accuracy of USTR’s estimate of the burden of the proposed information collection request, including the validity of the methodology and assumptions used.

(3) Ways to enhance the quality, utility, and clarity of the information collection request.

(4) Ways to minimize the burden of the information collection request on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.

In the notice, USTR also signals its expectations for the number of potential product exclusion requests and comments on List 3, noting that it expects to start collecting exclusion applications on or around June 30, 2019, and that it anticipates receiving roughly 60,000 exclusion applications.

We will continue to monitor this situation closely. For more information on the Section 301 tariffs on China, please contact our International Trade and Supply Chain Group –  Jeffrey Neeley, Nithya Nagarajan, Cortney Morgan, Robert Stang, or Beau Jackson.