Exclusion Process for List 3 of Section 301 Tariffs May Make Existing Process Slower
It bears watching how U.S. Trade Representative Robert Lighthizer interprets his “instruction” to initiate an exclusion process as required under the Feb. 15 spending bill (see 1902150047), customs lawyer Ted Murphy of Baker McKenzie blogged. That includes whether Lighthizer will apply it retroactively to Sept. 24. Though “the expectation that USTR will create an exclusion process within 30 days is clear,” less so is “exactly what it will cover and how it will be implemented,” he said.
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Lighthizer arguably might read the language on "new round 3 tariffs" to support his “existing plan of creating an exclusion process for List 3 only if the duties increase to 25%,” Murphy said.
A spokesman for the House Appropriations Committee said that is not the case, that USTR must initiate an exclusion process even if the tariffs hold at 10 percent. President Donald Trump suggested again Feb. 19 that he may not raise the tariffs on March 2.
Lighthizer’s office didn’t comment.
Venable Partner Lindsay Meyer told International Trade Today that when the exclusion process starts for List 3, it will likely make things worse for companies still waiting for decisions on requests from the first two lists. "It has been a slow roll for List 1 and List 2," she said, and there are no more resources associated with the new law. She suggested that Lighthizer may argue that evaluating exclusion requests for List 3 should be given a lower priority than those already in the queue, given that the first two lists have 25 percent tariffs. Congress might agree that these requests go "at the back of the line behind List 1 and List 2."
The Appropriations Committee spokesman said it's hard to answer a hypothetical like that, but no language in the law gives USTR discretion to prioritize requests.