USTR Opens 301 Tariff Exclusion Process

The Office of the United States Trade Representative announced Tuesday that it is opening a process for interested persons to request that certain machinery be temporarily excluded from Section 301 duties in the Investigation of China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation.  

Consistent with the President’s direction, the exclusion process covers particular machinery used in domestic manufacturing classified within a subheading under chapters 84 and 85 of the Harmonized Tariff Schedule of the United States. 

A list of eligible subheadings is available here.

As explained in a formal notice, the docket for submitting exclusions opens on October 15, 2024. The deadline for submitting exclusion requests is March 31, 2025. 
 

In the May FR Notice [89 FR 46252] the USTR proposed 312 subheadings eligible for consideration for temporary exclusion under a process by which interested persons may request that particular machinery used in domestic manufacturing and classified within certain subheadings under Chapters 84 and 85 of HTSUS be temporarily excluded.

The May 28 notice announced that procedures for requesting exclusions under this process would be published in a separate notice. Finally, the U.S. Trade Representative proposed 19 temporary exclusions for solar manufacturing equipment.

On September 18, 2024, the U.S. Trade Representative announced modifications to the actions, includingcertain adjustments to the modifications proposed in the May 28 notice. See [89 FR 76581] (September 18 notice).

Regarding the 19 proposed temporary exclusions for solar manufacturing equipment, the U.S. Trade Representativedetermined to adopt 14. The U.S. Trade Representative also announced five additional subheadingsto be eligible for consideration of temporary exclusion under the machinery exclusion process.

Requesting Exclusions

Each request specifically must identify a particular product, and provide supporting data and the rationale for the requested exclusion.USTR will evaluate each request on a case-by-case basis, taking into account the asserted rationale for the exclusion, whether the exclusion would undermine the objective of the Section 301 investigation, and whether the request defines the product with sufficient precision.

Any request for exclusion must include the following information:

• The 10-digit subheading of the HTSUS applicable to the manufacturing equipment requested for 
• A complete and detailed description of the manufacturing equipment. [...] and any unique physical features that distinguish it from other manufacturing equipment within the covered 10-digit HTSUS subheading. 

• Whether the manufacturing equipment of concern is subject to an antidumping or countervailing duty order issued by the U.S. Department of Commerce.
• Whether the manufacturing equipment will be used for domestic manufacturing, how the equipment will be used, and the manufacturing sector.
• If applicable, documents showing grant funding from, or grant application to, a federal investmentprogram related to the domestic manufacturing at issue, such as the Inflation Reduction Act (IRA), CHIPS and Science Act, Build America Buy America (BABA), and Rural Energy for America Program (REAP).
• Whether the manufacturing equipment of concern, or comparable manufacturing equipment, is available from sources in the United States or third countries and any attempts of the requesting organization to source the manufacturing equipment from the United States or third countries.
• Whether the requesting organization has purchased the manufacturing equipment of concern from asource in the United States or in a third country in the past five years and why the manufacturing equipment is no longer available from this
• Whether the manufacturing equipment of concern is strategically important or related to “Made in China 2025” or other Chinese industrial programs.

In addressing each factor, the requester should provide support for their assertions. Requesters also mayprovide any other information or data that they consider relevant to an evaluation of the request.

Interested persons must submit requests for exclusions in the period between the opening of the portal on October 15, 2024, and the March 31, 2025 submission deadline.