aluminum Archives

The Bureau of Industry and Security (BIS) is proposing a new rule to revise the process for requesting exclusions from the duties and quantitative limitations on imports of aluminum and steel under Section 232 of the Trade Expansion Act.

The proposed rule includes the following changes:

Clarification of the criteria for granting exclusions. The proposed rule clarifies the criteria that BIS will consider when evaluating exclusion requests, including the impact of the exclusion on national security.
Streamlining of the exclusion process. The proposed rule streamlines the exclusion process by eliminating certain procedural requirements and deadlines.
Improvements to the Section 232 Exclusions Portal. The proposed rule makes improvements to the Section 232 Exclusions Portal, including making it easier for users to submit and track exclusion requests.

Changing the General Approved Exclusion (GAE) criteria

Currently, a GAE is identified based on whether an Harmonized Tariff Schedule of the United States (HTSUS) code has received objections. Under the proposed changes, this criterion will change to focus instead on the number of substantiated objections. This will discourage objections that are submitted solely to prevent specific GAEs. BIS estimates that this change could result in up to a 20% reduction in the total number of exclusion requests submitted.

Introducing a General Denied Exclusions (GDE) process

GDEs will be implemented for HTSUS classification codes that have very high rates of successful, substantiated objections. This will reduce the burden on objectors and requesters with respect to exclusion requests that have historically had a very low likelihood of being approved.

Updating the certification requirements for exclusion requests and objections

BIS is proposing to require requesters to certify that they have first made reasonable efforts to source their product from the United States, and then from a country with which the United States has arrived at a satisfactory alternative means to address the threat to the national security under Section 232. Requesters would also be required to provide evidence of these sourcing attempts simultaneously with their request submission.

Objectors would certify their intent and ability to provide the requested product to the requester if successful in their objection. In addition, objectors would be required to provide evidence that they have commercially sold the same product as that which is being requested within the last 12 months, or evidence that they have engaged in sales discussions with the requesting company or another company requesting the same product within the last 12 months.

BIS anticipates that these proposed changes will improve the efficiency, fairness, and transparency of the Section 232 exclusions process for all involved parties.

How will this affect importers?

Importers may need to submit more evidence to support their exclusion requests. For example, requesters will need to certify that they have made reasonable efforts to source the product from the United States or a partner country before requesting an exclusion.

Some importers may be more likely to have their exclusion requests denied. For example, if an importer is requesting an exclusion for a product that has a high rate of successful objections, their request is more likely to be denied under the new GDE process.

Importers may need to adjust their sourcing strategies. For example, if you’re currently sourcing a product from a country that is not a partner country, you may need to consider sourcing from the United States or a partner country in order to increase your chances of obtaining an exclusion.

To prepare for these changes, importers should:

Review the proposed rule and identify any changes that may impact your business.
Assess their current sourcing strategies and make any necessary adjustments.
Start gathering evidence to support future exclusion requests.
Monitor the Federal Register for updates on the proposed rule and for the publication of the final rule. Once the final rule is published, importers will have a certain amount of time to comply with the new requirements.

BIS is accepting public comments on the proposed rule until October 12, 2023. Importers who have any concerns about the proposed changes should consider submitting a comment.

To stay informed on trade news and other important updates, stay connected with a customs broker.

From 2018 to 2021, US importers bore nearly the full cost of the Section 232 tariffs on imports of aluminum and steel products, and the Section 301 tariffs on thousands of products imported from China, according to a new report released by the U.S. International Trade Commission (USITC).

The report, titled Economic Impact of Section 232 and 301 Tariffs on U.S. Industries, found that on average between 2018 and 2021:

Importers bore nearly the full cost of the tariffs because import prices increased at the same rate as the tariffs at a rate of about 1%.
Section 232 tariffs reduced affected steel imports by 24%, increased the price of steel products in the US by 2.4%, and increased US steel production by 1.9% and $1.3 billion.
Section 232 tariffs recued affected aluminum imports by 31%, increased the price of aluminum products in the US by 1.6%, and increased US aluminum production by 3.6% and $0.9 billion.
Section 232 increased domestic sourcing and reduced production in downstream industries in the US that used steel and aluminum products as inputs by 0.6% on average, and increased prices in downstream industries by 0.2% on average.
US production in downstream industries was $3.5 billion less in 2021 due to Section 232 tariffs.
Section 301 tariffs reduced imports from China by 13% across all affected sectors, increased the value of US production by 0.4%, and increased the price of US products by 0.2%.
Section 301 duties reduced imports of computer equipment by 5%, increased the price of computer equipment in the US by 0.8%, and increased the value of US production of computer equipment by 1.2%.
Section 301 tariffs reduced imports of semiconductors by 72.3%, increased the price of semiconductors in the US by 4.1%, and increased the value of US production of semiconductors by 6.4%.

The report did not draw any broad conclusions about whether the tariffs under Section 232 and Section 301 had a positive or negative impact on the US economy overall.

To stay informed on import news and other important updates, stay connected with a customs broker.

Importers of steel and aluminum products are no longer required to provide certain information to U.S. Customs and Border Protection (CBP) by email in order to activate approved Section 323 exclusions in Automated Commercial Environment (ACE).

According to a message issued on Feb. 7, the CBP stated that it is now directly processing approved Section 232 exclusions based on weekly lists provide by the Department of Commerce (DOC). The CBP is now activating approved product exclusion IDs in ACE on a weekly basis.

Importers can check the CBP.gov website every Friday, to determine if a Section 232 approved product exclusion is active in ACE. The posting can be found on the Active Section 323 Product Exclusions in ACE page here.

The product exclusion ID must be on the list of active product exclusions on CBP.gov before the importer of record or customs broker submits the exclusion ID on an entry or entry summary line.

CBP receives approved exclusions from the DOC on a weekly basis and activates exclusions in ACE on a weekly basis. As a result, the CBP notes that there will be a delay between the approval date of a Section 232 exclusion and activation in ACE. If an approved product exclusion is not on the active product exclusion list on CBP.gov, you should check the following Friday.

If for some reason you’re unable to file an entry with one of the active product exclusion numbers, you should contact your CBP Client Representative.

CBP will only process a product exclusion if the name of the Importer of Record (IOR) is on the original exclusion submission request with DOC and matches the importer name registered in ACE through the 5106 process (see CSMS 48979698). If the name of the importer of record on the original exclusion submission request with DOC does not match the importer name registered in ACE, the importer will need to submit an IOR change request directly with DOC.

For more information, including instructions for filing a Product Exclusion ID, visit the CBP’s updated page on Section 232 Product Exclusions.

To stay informed on trade news and other important updates, stay connected with a customs broker.