On Tuesday, May 19, the Department of Commerce issued a Notice requesting comments on a newly initiated Section 232 national security investigation into electrical transformers, and key components of the transformers, which we addressed earlier in one of our blog posts. The investigation focuses on liquid and dry transformers above 1 KVA power handling capacity. As set forth in the notice: “[T]he investigation has been undertaken to determine the effect on the national security of imports of Laminations for Stacked Cores for Incorporation into Transformers, Stacked Cores for Incorporation into Transformers, Wound Cores for Incorporation into Transformers, Electrical Transformers, and Transformer Regulators (hereinafter “Products”). If the Secretary finds that Products are being imported into the United States in such quantities or under such circumstances as to threaten to impair the national security, the Secretary shall so advise the President in his report on the findings of the investigation.”
Under this statute, the Secretary of Commerce has 270 days to issue a report to the president. The president has another 90 days to determine whether he will accept or reject the findings of the report, and to decide the nature and duration of the action, if any, he will take to adjust imports of the concerned product into the United States. That action could be in the form of additional tariffs on entry, a quota on permissible limits on entry, or a combination of the two. For example, Section 232 is the statute under which the president recently imposed significant import duties on steel (25%) and aluminum (10%). He also negotiated quotas with certain countries through which entries under the quota were exempt from the tariffs, but any entries above those country limits would be assessed the additional tariff.
Through the notice issued on May 19, the Department of Commerce is seeking written comments, data, analyses, or other information pertinent to the investigation. Comments are due by June 9 and rebuttal comments are due 10 days later on June 19. The notice also sets out a number of issues that the Department of Commerce would like to see addressed in the comments.