On March 8, 2018, President Trump proclaimed new tariffs on steel and aluminum imports as a result of an investigation into the national security impact of these imports under Section 232 of the Trade Expansion Act of 1962.
Although these tariffs will apply to a wide range of steel and aluminum products from all countries except Canada and Mexico, the United States Trade Representative (USTR) is considering exemptions for other countries and the Department of Commerce (DOC) will review requests from affected US parties for specific product exclusions. USTR and DOC are expected to release official guidance on the exemption and exclusion processes in the next few days. National security and related strategic considerations will factor heavily into both agencies’ decision making. According to media reports, in the USTR process, countries’ security relationships with the US and alignment with US trade policy goals will be determining factors in whether a country can receive an exemption. In the DOC process, US companies seeking product exemptions will need to show how imports are required to serve US demand or how the imports in question serve to promote US national security. (Within DOC, the Bureau of Industry and Security, which administers the DOC export controls program, also will have responsibility for handling Section 232 exemption requests.)
As such, it will be critically important for companies seeking product exclusions or otherwise managing the impact of this major trade policy development to understand the national security implications of the steel and aluminum that they import. An alert from our International Trade Practice discusses the tariffs, the exemption/exclusion processes, and next steps for affected companies in detail.