[Federal Register Volume 84, Number 90 (Thursday, May 9, 2019)]
[Notices]
[Pages 20459-20460]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-09681]
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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE
Notice of Modification of Section 301 Action: China's Acts,
Policies, and Practices Related to Technology Transfer, Intellectual
Property, and Innovation
AGENCY: Office of the United States Trade Representative.
ACTION: Notice of modification of action.
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SUMMARY: In accordance with the direction of the President, the U.S.
Trade Representative (Trade Representative) has determined to modify
the action being taken in this Section 301 investigation by increasing
the rate of additional duty from 10 percent to 25 percent for the
products of China covered by the September 2018 action in this
investigation. The Trade Representative has further determined to
establish a process by which interested persons may request that
particular products classified within a tariff subheading covered by
the September 2018 action be excluded from the additional duties.
DATES: The rate of additional duty will increase to 25 percent with
respect to products covered by the September 2018 action on May 10,
2019.
FOR FURTHER INFORMATION CONTACT: For questions about this notice,
contact Associate General Counsel Arthur Tsao, Assistant General
Counsel Philip Butler, or Director of Industrial Goods Justin Hoffmann
at (202) 395-5725. For questions on customs classification or
implementation of additional duties on products covered by the
September 2018 action, contact [email protected].
SUPPLEMENTARY INFORMATION:
A. September 2018 Action
For background on the proceedings in this investigation, please see
the prior notices issued in the investigation, including 82 FR 40213
(August 23, 2017), 83 FR 14906 (April 6, 2018), 83 FR 28710 (June 20,
2018), 83 FR 33608 (July 17, 2018), 83 FR 38760 (August 7, 2018), and
83 FR 40823 (August 16, 2018).
In a notice published on September 21, 2018 (83 FR 47974), the
Trade Representative, at the direction of the President, announced a
determination to modify the action being taken in the investigation by
imposing additional duties on products of China with an annual trade
value of approximately $200 billion. The rate of additional duty
initially was 10 percent. Those additional duties were effective
starting on September 24, 2018, and currently are in effect. Under
Annex B of the September 21 notice, the rate of additional duty was set
to increase to 25 percent on January 1, 2019. In the September 21
notice, the Trade Representative stated that he would continue to
consider the actions taken in this investigation, and if further
modifications were appropriate, he would take into account the
extensive public comments and testimony previously provided in response
to the notices published on July 17, 2018 (83 FR 33608) and August 7,
2018 (83 FR 38760).
On September 28, 2018 (83 FR 49153), the Trade Representative
issued a conforming amendment and modification of the September 21
notice. The current notice refers to the September 21 notice, as
modified by the September 28 notice, as the `September 2018 action.'
On December 19, 2018 (83 FR 65198), in accordance with the
direction of the President, the Trade Representative determined to
modify the September 2018 action by postponing until March 2, 2019, the
increase in the rate of additional duty to 25 percent. The Annex to the
December 19 notice, which superseded Annex B to the September 21
notice, amended the Harmonized Tariff Schedule of the United States
(HTSUS) to reflect this postponement of the increase in the rate of
duty applicable to the September 2018 action.
On March 5, 2019 (84 FR 7699), in accordance with the direction of
the President, the Trade Representative determined to modify the
September 2018 action by postponing until further notice the increase
in the rate of additional duty to 25 percent. Annex B of the September
21 notice (83 FR 47974) and the Annex to the December 19 notice (83 FR
65198) were rescinded. In accordance with Annex A of the September 21
notice, the rate of additional duty under the September 2018 action
remained at 10 percent until further notice.
B. Determination to Further Modify September 2018 Action
The United States is engaging with China with the goal of obtaining
the elimination of the acts, policies, and practices covered in the
investigation. The leaders of the United States and China met on
December 1, 2018, and agreed to hold negotiations on a range of issues,
including those covered in this Section 301 investigation. See https://www.whitehouse.gov/briefings-statements/statement-press-secretary-regarding-presidents-working-dinner-china/. Since the meeting on
December 1, the United States and China have engaged in additional
rounds of negotiation on these issues, including meetings in March,
April, and May of 2019. In the most recent negotiations, China has
chosen to retreat from specific commitments agreed to in earlier
rounds. In light of the lack of progress in discussions with China, the
President has directed the Trade Representative to increase the rate of
additional duty to 25 percent.
Section 301(b) of the Trade Act of 1974, as amended (Trade Act),
provides that the Trade Representative ``shall take all appropriate and
feasible action authorized under [Section 301(c)] to obtain the
elimination of [the] act, policy, or practice [under investigation].''
Section 307(a)(1) of the Trade Act authorizes the Trade Representative
to modify or terminate any action being taken under Section 301,
subject to the specific direction, if any, of the President if ``the
burden or restriction on United States commerce . . . of the acts,
policies, and practices, that are the subject of such action has
increased or decreased, or such action is
[[Page 20460]]
being taken under Section [301(b)] of this title and is no longer
appropriate.'' In light of the lack of progress in the additional
rounds of negotiations since March 2019, and at the direction of the
President, the Trade Representative has determined that it is
appropriate for the rate of additional duty under the September 2018
action to increase to 25 percent on May 10, 2019.
The Trade Representative's decision to modify the September 2018
action takes into account the extensive public comments and testimony,
as well as advice from advisory committees, concerning the actions
proposed in the notices issued in advance of the September 2018 action
(83 FR 33608 and 83 FR 38760). Those notices, among other things,
requested comments on whether the rate of additional duties should be
10 percent or 25 percent. The Trade Representative's decision also
reflects the advice of the interagency Section 301 Committee.
The Annex to this notice amends the Harmonized Tariff Schedule of
the United States to provide that the rate of additional duties for the
September 2018 action will increase to 25 percent on May 10, 2019.
Pursuant to Sections 301(b), 301(c), 304(a), and 307(a) of the
Trade Act, the Trade Representative has determined that the Office of
the United States Trade Representative (USTR) will establish a process
by which interested persons may request that particular products
classified within an HTSUS subheading covered by the September 2018
action be excluded from the additional duties. USTR will publish a
separate notice describing the product exclusion process, including the
procedures for submitting exclusion requests, and an opportunity for
interested persons to submit oppositions to a request.
Annex
Effective with respect to goods (i) entered for consumption, or
withdrawn from warehouse for consumption, on or after 12:01 a.m.
eastern daylight time on May 10, 2019, and (ii) exported to the United
States on or after May 10, 2019, subchapter III of chapter 99 of the
Harmonized Tariff Schedule of the United States is modified:
1. By amending U.S. Note 20(e) to subchapter III of chapter 99 by
deleting ``10 percent'' each place that it appears, and inserting ``25
percent'' in lieu thereof;
2. by amending U.S. Note 20(g) to subchapter III of chapter 99 by
deleting ``10 percent'' each place that it appears, and inserting ``25
percent'' in lieu thereof;
3. by amending the Rates of Duty 1-General column of heading
9903.88.03 by deleting ``10%'', and inserting ``25%'' in lieu thereof;
and
4. by amending the Rates of Duty 1-General column of heading
9903.88.04 by deleting ``10%'', and inserting ``25%'' in lieu thereof.
Joseph Barloon,
General Counsel, Office of the U.S. Trade Representative.
[FR Doc. 2019-09681 Filed 5-8-19; 8:45 am]
BILLING CODE 3290-F9-P