• AJM Packaging Corporation
• Dart Container Corporation
• Aspen Products, Inc.
• Huhtamaki Americas, Inc.
• 9201 Packaging Drive
• Unique Industries, Inc.

The petition claims the paper plates were sold at less than fair value, and that certain paper plates from China and Vietnam benefit from countervailable subsidies. Petitioners claim that these imports have caused material injury and threaten additional material injury to the domestic industry producing paper plates.

Full list of producers here. Full list of U.S. importers here.

The proposed scope language is broad and includes “Paper plates, which may be white, colored, and/or printed, and if printed, may be printed and/or laminated by any means with images, text and/or colors on one or both surfaces.” Full description and scope here.

The Commerce Department will determine whether to initiate the investigations within 20 days. The USITC will reach a preliminary determination of material injury or threat of material injury within 45 days. Final determinations will likely occur late 2024.

As with any proceeding, participation is very important to protect your rights. We urge anyone that imports paper plates to pay close attention to this case and to ensure that all appropriate steps are taken to mitigate any damage.

Diaz Trade Law will continue to monitor this case and share updates. For more information or questions get in touch with us at 305-456-3830 or info@diaztradelaw.com.

Customs and Border Protection (CBP)

• President Biden signed H.R. 8982, the Bulk Infant Formula to Retail Shelves Act on October 10, 2022. Duty-free treatment will only be provided to importers of base powder to be manufactured into infant formula authorized to be marketed in the United States or subject to an enforcement discretion letter from the Food and Drug Administration (FDA). The effective date is October 13, 2022, the third day after signature.
  • Should you have questions regarding enforcement discretion, please refer to the Enforcement Discretion to Manufacturers to Increase Infant Formula Supplies FDA website.

The Office of the United States Trade Representative

• The Office of the United States Trade Representative announced the next steps in the statutory four-year review of the tariff actions in the Section 301 investigation of China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation following requests for continuation from representatives of domestic industries
  • USTR is seeking public comments, consistent with the statutory directive, to consider the effectiveness of the actions in achieving the objectives of the investigation, other actions that could be taken, and the effects of the actions on the United States economy, including consumers.

United States Department of Commerce (DOC)

• Department of Commerce (DOC) announced on October 3, 2022, an opportunity to request administrative review and join annual inquiry service list for products on AD/CVD lists.  
• DOC is issuing a final rule to implement Proclamation 10414, “Declaration of Emergency and Authorization for Temporary Extensions of Time and Duty- Free Importation of Solar Cells and Modules from Southeast Asia.” 
• DOC is amending the Export Administration Regulations (EAR) in response to Russia’s further invasion of Ukraine on February 24, 2022.
• DOC and the International Trade Commission (USITC) announced a petition filed on Oct. 12 which alleges paper file folders from China, India, and Vietnam are being sold at less than fair value in the U.S. market, and in India benefiting from countervailable subsidies. The alleged average dumping margins are 116.69 percent for China, 174.19 percent for India, and 214.53 percent for Vietnam.
• DOC and the U.S. International Trade Commission (USITC) announced on October 12, that revocation of the antidumping duty  order on certain artist canvas from China would likely lead to a continuation or recurrence of dumping and material injury to an industry in the U.S. 
• DOC determined on October 12, that POSCO and its affiliated companies, made sales of subject merchandise in the United States at less than normal value during the period of review May 1, 2020, through April 30, 2021.
  • DOC intends to disclose the
    calculations for these final results of
    review within five days of the date of
    publication of this notice in the Federal
    Register.
• DOC and the U.S. International Trade Commission (USITC) announced on October 12, that revocation of the AD/CVD orders on certain biaxial integral geogrid products from China would likely lead to continuation or recurrence of dumping, countervailable subsidies, and material injury to an industry in the U.S.
• DOC determines that certain steel nails from the United Arab Emirates were sold in the United States at less than normal value during the period of review May 1, 2020, through April 30, 2021.
  • DOC plans to adopt the Preliminary Results as the
    final results of their review.
• DOC continues to determine that the 30 companies subject to this administrative review of the antidumping duty order on  magnesia carbon bricks from China are part of the China-wide entity because they did not demonstrate eligibility for separate rates.
  • The period of review is September 1, 2020, through August 31, 2021.

U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC)

• U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned three individuals on October 6, 2022, and one entity connected to Burma’s military regime pursuant to Executive Order (E.O.) 14014. Following the February 1, 2021, coup that overthrew Burma’s democratically elected civilian government, the military has committed numerous atrocities against people in Burma, including the violent repression of political dissent, the killing of over 2,300 innocent civilians, and displacement of more than 900,000 people. 
• OFAC on October 6, 2022, designated seven senior leaders within Iran’s government and security apparatus for the shutdown of Iran’s Internet access and the continued violence against peaceful protesters in the wake of the tragic death of 22-year-old Mahsa Amini, who was arrested for allegedly wearing a hijab improperly, and died in the custody of Iran’s Morality Police. 
• OFAC on September 30, 2022, placed hundreds of Russian individuals and entities on the Specially Designated Nationals (SDN) List in response to Russia’s illegal annexation of Ukrainian territories.  
• OFAC on September 29, 2022, sanctioned an international network of companies involved in the sale of hundreds of millions of dollars’ worth of Iranian petrochemicals and petroleum products to end users in South and East Asia. 
• OFAC on October 7,2022, designated Malaysian national Teo Boon Ching, the Teo Boon Ching Wildlife Trafficking Transnational Criminal Organization (TCO), and the Malaysian company Sunrise Greenland Sdn. Bhd. for the cruel trafficking of endangered and threatened wildlife and the products of brutal poaching. 
• OFAC on October 7, 2022, designated two individuals and three entities for activities related to the exportation of petroleum to the Democratic People’s Republic of Korea (DPRK), which directly supports the development of DPRK weapons programs and its military. 
• OFAC and Financial Crimes Enforcement Network (FinCEN) announced settlements for over $24 million and $29 million, respectively, with Bittrex, Inc. (Bittrex), a virtual currency exchange based in Bellevue, Washington. 
• OFAC is publishing one general license (GL) issued pursuant to the Iranian Transactions and Sanctions Regulations: GL D-2, which was previously made available on OFAC’s website.
• OFAC is publishing one sectoral determination issued pursuant to an April 15, 2021 Executive order, as well as a category of services determination issued pursuant to an April 6, 2022 Executive order.
• OFAC is publishing one general license (GL) issued pursuant to the Russian Harmful Foreign Activities Sanctions Regulations: GL 13B, which was previously issued on OFAC’s website.
• OFAC is publishing nine general licenses (GLs) issued in the Venezuela Sanctions Regulations program: GLs 3, 3A, 3B, 3C, 3D, 3E, 3F, and 3G, each of which was previously issued on OFAC’s website and is now expired, as well as GL 3H, which was also previously issued on OFAC’s website.
• OFAC is publishing eight general licenses (GLs) issued in the Venezuela Sanctions Regulations program: GLs 9, 9A, 9B, 9C, 9D, 9E, and 9F, each of which was previously issued on OFAC’s website and is now expired, as well as GL 9G, which was also previously issued on OFAC’s website.
• OFAC published the names of one or more persons that have been placed on OFAC’s Specially Designated Nationals and Blocked Persons List (SDN List) based on OFAC’s determination that one or more applicable legal criteria were satisfied. All property and interests in property subject to U.S. jurisdiction of these persons are blocked, and U.S. persons are generally prohibited from engaging in transactions with them.

United States International Trade Commission (USITC)

• United States International Trade Commission (USITC) hereby gives notice of the institution of investigations and commencement of preliminary phase antidumping and countervailing duty investigation Nos. 701-TA-682 and 731-TA-1592-1593 (Preliminary) pursuant to the Tariff Act of 1930 (“the Act”) to determine whether there is a reasonable indication that an industry in the United States is materially injured or threatened with material injury, or the establishment of an industry in the United States is materially retarded, by reason of imports of certain freight rail couplers and parts thereof from China and Mexico, provided for in subheadings 8607.30.10 and 7326.90.86 of the Harmonized Tariff Schedule of the United States, that are alleged to be sold in the United States at less than fair value and alleged to be subsidized by the Government of China. 

United States Department of Labor (DOL)

• Department of Labor (DOL) has updated its list of goods produced by child or forced labor on September 28, 2022, and is now comprised of 158 goods from 77 countries.  

The White House and Congress

• President Biden issued an executive order on September 15, 2022, elaborating upon existing statutory factors and include additional national security factors the Committee on Foreign Investment in the United States (CFIUS or “Committee”) must consider in its review process of a covered transaction. 
• United States Senate on September 21, 2022, ratified the Kigali Amendment which will phase down global production and consumption of hydrofluorocarbons (HFCs), super-polluting chemicals in technology markets.  
• President Biden on September 15, 2022, issued an executive order elaborating on statutory factors and additional national security factors the Committee on Foreign Investment in the United States must consider in its review process of covered transactions.

Bureau of Industry and Security (BIS)

• The Bureau of Industry and Security (BIS) is amending the Export Administration Regulations (EAR) to implement necessary controls on advanced computing integrated circuits (ICs), computer commodities that contain such ICs, and certain semiconductor manufacturing items.
  • In addition, BIS is expanding controls on transactions involving items for supercomputer and semiconductor manufacturing end uses.
• BIS is amending the Export Administration Regulations (EAR) by adding 31 persons to the Unverified List (UVL). The 31 persons of China are added to the UVL on the basis that BIS was unable to verify their bona fides because an end-use check could not be completed satisfactorily for reasons outside the U.S. Government’s control.

British Broadcasting Channel (BBC)

• BBC reports that shares in major Asian computer chipmakers have fallen following the U.S. implementing a ban on American firms from selling certain chips.

Customs and Border Protection (CBP) Bulletin Weekly, Vol. 56, October 5, 2022, No. 39

• Extension and Amendment of Import Restrictions on Archaeological and Ethological Materials from Mali
  • This document amends the U.S. Customs and Border Protection (CBP) regulations to reflect an extension and amendment of import restrictions on certain categories of archaeological and ethnological material from the Republic of Mali (Mali) to fulfill the terms of the new agreement, titled ‘‘Agreement Between the Government of the United States of America and the Government of the Republic of Mali Concerning the Imposition of Import Restrictions on Categories of Archaeological and Ethnological Material of Mali.’’
  • The Designated List, which was last described in CBP Dec. 17–12, is amended in this document to reflect additional categories of archaeological material found throughout the entirety of Mali and additional categories of ethnological material associated with religious activities, ceremonies, or rites, and enforcement of import restrictions is being extended for an additional five years by this final rule
• Quarterly interest rates used in calculating interest on overdue accounts and refunds on Customs duties
  • This notice advises the public that the quarterly Internal Revenue Service interest rates used to calculate interest on overdue accounts (underpayments) and refunds (overpayments) of customs duties will increase from the previous quarter.
  • For the calendar quarter beginning October 1, 2022, the interest rates for overpayments will be 5 percent for corporations and 6 percent for non-corporations, and the interest rate for underpayments will be 6 percent for both corporations and non-corporations
• Proposed revocation of two ruling letter and proposed revocation of treatment relating to the tariff classification of pan masala betel nut food product
  • In NY 830068 and DD H890859, CBP classified the pan masala betel nut food product in heading 2106, HTSUS, specifically in subheading 2106.90.6099, HTSUS Annotated (HTSUSA) (currently subheading 2106.90.99, HTSUS, under the 2022 HTSUS), which provides for “Food preparations not elsewhere specified or included: Other: Other: Other: Other.”
  • CBP has reviewed both NY 830068 and DD H890859 and has determined the ruling letters to be in error. It is now CBP’s position that pan masala betel nut food product is properly classified, in heading 2008, HTSUS, specifically in subheading 2008.19.9090, HTSUSA, which provides for “Fruit, nuts and other edible parts of plants, otherwise prepared or preserved, whether or not containing added sugar or other sweetening matter or spirit, not elsewhere specified or included: Other, including mixtures: Other, including mixtures: Other: Other.”
• New American Keg v. United States
  • Because the Department of Commerce failed to explain why it was appropriate to inflate a Mexican labor wage rate using Brazilian data and why doing so was superior to using a Brazilian labor wage rate and to identify the evidence in the administrative record that supported granting a company a separate rate, the case had to be remanded.
• Hyundai Steel Company v. United States
  • Because the Commerce Department reopened the record and necessary information was available, the court concluded that the Department’s decision to recalculate plaintiff’s dumping margin at 0.46% without applying facts available was supported by substantial evidence. Because the court sustained the Department’s decision to not use facts available in recalculating plaintiff’s dumping margin, consideration of the Department’s reiterated benefit determination in the remand results would have no practical significance and was mooted.
• United States v. Zhe “John” Liu
  • Zhe “John” Liu and GL Paper Distribution, LLC (collectively, “Liu”), has moved pursuant to USCIT Rule 12(f) to strike portions of the complaint presented by the United States (“Government”), arguing that paragraphs 5–10, 14, 16, 17, 21, 22, and the majority of paragraph 3 of the complaint are “wholly unrelated to the underlying action and contain allegations that are potentially prejudicial.”
  • Motion to strike denied
• Eteros Technologies v. United States
  • Washington State’s repeal of certain prohibitions attending marijuana-related drug paraphernalia “authorized” plaintiff such that plaintiff’s importation of component parts of an agricultural machine, which was designed to separate the leaf from the flower of cannabis or other plant material, through the Port of Blaine, Washington was exempted by the federal Controlled Substances Act, 21 U.S.C.S. § 863(f)(1), from the federal prohibition on importing drug paraphernalia.

Customs and Border Protection (CBP) Bulletin Weekly, Vol. 56, October 12, 2022, No. 40

• Extension of import restrictions on archaeological and ecclesiastical ethnological materials from Guatemala
  • This document amends the U.S. Customs and Border Protection (CBP) regulations to reflect an extension of import restrictions on certain categories of archaeological and ecclesiastical ethnological materials from Guatemala to fulfill the terms of the new agreement, titled ‘‘Memorandum of Understanding between the Government of the United States of America and the Government of the Republic of Guatemala Concerning the Imposition of Import Restrictions on Categories Of Archaeological and Ethnological Material of Guatemala.’’
  • CBP Dec. 12–17, which contains the Designated List of archaeological and ecclesiastical ethnological material from Guatemala to which the restrictions apply, is being extended for an additional five years by this final rule.
• Proposed modification of one ruling letter and proposed revocation of treatment relating to the tariff classification of finished wood slats and wood bottom rails with UV coatings used for window blinds
  • In NY N041645, CBP classified various wood components used for the manufacture of window blinds, including two styles of finished wood valances and wood slats that were primed and painted and three styles of finished wood slats and wood bottom rails that were either stained or painted and coated with UV coatings, in heading 4409, HTSUS, specifically in subheading 4409.29.9000, HTSUSA (“Annotated”) , which provides for “[w]ood (including strips and friezes for parquet flooring, not assembled) continuously shaped (tongued, grooved, rebated, chamfered, V-jointed, beaded, molded, rounded or the like) along any of its edges, ends or faces, whether or not planed, sanded or end-jointed: Nonconiferous: Other: Other: Other.” CBP has reviewed NY N041645 and has determined the ruling letter to be partially in error.
  • It is now CBP’s position that the finished wood slats and wood bottom rails with UV coatings used for window blinds are properly classified, in heading 4421, HTSUS, specifically in subheading 4421.99.9880, HTSUSA, which provides for “[o]ther articles of wood: Other: Other: Other: Other…Other.”
• Proposed modification of one ruling letter and proposed revocation of treatment relating to the tariff classification of woven upholstery fabrics
  • In NY N319028, CBP classified the woven upholstery fabrics (Style N1829 (Moriarty), Style D1818 (Glossary), and Style J1819 (Fringe)) in heading 5903, HTSUS, specifically in subheading 5903.90.25, HTSUS, which provides for “Textile fabrics impregnated, coated, covered or laminated with plastics, other than those of heading 5902: Other: Of man-made fibers: Other.” CBP has reviewed NY N319028 and has determined the ruling letter to be in error.
  • It is now CBP’s position that woven upholstery fabrics are properly classified, within either heading 5407, HTSUS, or heading 5515, HTSUS, dependent on the specific subject merchandise at-issue. Specifically it is CBP’s position that the first woven upholstery fabric (Style N1829 (Moriarty)) is properly classified within in subheading 5407.53.20, HTSUS, which provides for “Woven fabrics of synthetic filament yarn, including woven fabrics obtained from materials of heading 5404: Other woven fabrics, including 85 percent or more by weight of textured polyester filaments: Of yarns of different colors: Other,” that the second woven upholstery fabric (Style D1818 (Glossary)) is classified within 5407.73.20, HTSUS, which provides for “Woven fabrics of synthetic filament yarn, including woven fabrics obtained from materials of heading 5404: Other woven fabrics, containing 85 percent or more by weight of synthetic filaments: Of yarns of different colors: Other,” and that the third woven upholstery fabric (Style J1819 (Fringe)) is classified within subheading 5515.12.00, HTSUS, which provides for “Other woven fabrics of synthetic staple fibers: Of polyester stable fibers: Mixed mainly or solely with man-made filaments.”
• Proposed revocation of one ruling letter and proposed revocation of treatment relating to the tariff classification of a woman’s top
  • In NY N324185, CBP classified a woman’s top in heading 6211, HTSUS, specifically in subheading 6211.42.10, HTSUS, which provides for “Track suits, ski-suits and swimwear; other garments: Other garments, women’s or girls’: Of cotton: Other.” CBP has reviewed NY N324185 and has determined the ruling letter to be in error.
  • It is now CBP’s position that the woman’s top is properly classified in heading 6206, HTSUS, specifically in subheading 6206.30.30, HTSUS, which provides for “Women’s or girls’ blouses, shirts and shirt-blouses: Of cotton: Other: Other.”
• Proposed revocation of one ruling letter and proposed revocation of treatment relating to the tariff classification of metal storage lockers and cabinets for garage use
  • In NY N310710, CBP classified the metal storage lockers and cabinets in heading 9403, HTSUS, specifically in subheading 9403.20.0081, HTSUSA (Annotated), which provides for “Other furniture and parts thereof: Other metal furniture: Other: Counters, lockers, racks, display cases, shelves, partitions and similar fixtures: Other”. CBP has reviewed ruling letter to be in error.
  • It is now CBP’s position that the metal locker cabinets are properly classified, in heading 9403, HTSUS, specifically in subheading 9403.20.0050, HTSUSA, which provides for “Other furniture and parts thereof: Other metal furniture: Household: Other: Other
• Proposed revocation of one ruling letter and proposed revocation of treatment relating to the tariff classification of cast-iron cylinder heads and block castings
  • In NY N312073, CBP classified cast-iron cylinder heads and block castings in heading 8409, HTSUS, specifically in subheading 8409.99.91, HTSUS, which provides for “Parts suitable for use solely or principally with the engines of heading 8407 or 8408: Other: Other: Other: For vehicles of subheading 8701.20, or heading 8702, 8703 or 8704.” CBP has reviewed NY N312073 and has determined the ruling letter to be in error.
  • It is now CBP’s position that cast-iron cylinder heads and block castings are properly classified in heading 8409, HTSUS, specifically in subheading 8409.99.10, HTSUS, which provides for “Parts suitable for use solely or principally with the engines of heading 8407 or 8408: Other: Other: Cast-iron parts, not advanced beyond cleaning, and machined only for the removal of fins, gates, sprues and risers or to permit location in finishing machinery.”
• Proposed revocation of one ruling letter, proposed modification of one ruling letter and proposed revocation of treatment relating to the country of origin of certain air purifiers
  • In NY N322681, CBP determined that the air purifiers, manufactured from parts of Chinese and Vietnamese-origin and further assembled in Vietnam into subassemblies and the finished air purifiers, were products of China. It is now CBP’s position that the country of origin of these air purifiers is Vietnam. In NY N322364, CBP determined that air purifiers, manufactured from parts of Chinese and Vietnamese-origin and further assembled in Vietnam into subassemblies and the finished air purifiers, were products of Vietnam in the first manufacturing scenario and products of China in the second manufacturing scenario.
  • It is now CBP’s position that the country of origin of the air purifiers in the second manufacturing scenario is Vietnam
• Xi’an Metals & Mineral Import & Export Co v. United States
  • There was no error in the U.S. Court of International Trade’s determination that the CONNUM-specific rule was not subject to the notice-and-comment rulemaking provisions of the APA; hence, the U.S. Department of Commerce was entitled to clarify the regulation regarding the data used in performing margin calculations in the third administrative review because it needed data that more accurately reflected the costs associated with the production and sale of the subject merchandise;
  • The Court correctly determined that Commerce’s application of facts otherwise available (FA) was supported by substantial evidence; in deciding to apply FA, Commerce reasonably determined that appellant’s repeated failure to submit its cost information on a CONNUM-specific basis meant that necessary information reasonably reflecting the costs of production was not available.
• Kaptan Demir Celik Endustrisi ve Ticaret v. United States
  • A Turkish producer and exporter of steel concrete reinforcing bar was not entitled to a stay pending resolution of its separate action arising from the previous administrative review of the same countervailing duty order where no common legal issue was being reviewed by the appellate court, the administrative reviews were separate actions based on the specific factual records, and thus, the proposed stay did not meaningfully advance judicial economy;
  • In light of the court‘s overarching duty to timely resolve disputes, the interests of the litigants in resolving disputes quickly, as well as the general interest of the public in expeditiously resolving matters of great economic importance, the extensive stay of proceedings requested by the producer and exporter did not meet the pressing need required for such stays.
• HiSteel v. United States
  • Because the foreign producer of heavy walled rectangular welded carbon steel pipes and tubes did not seek any relief separate from that sought by the producer challenging its individual weighted-average dumping margin, the foreign producer could piggyback on the challenging producer’s standing and did not need to establish independent constitutional standing;
  • Because the underlying litigation consisted of a civil action commenced under § 516A of the Tariff Act of 1930, and because the foreign producer was an interested party who was a party to the proceedings, the foreign producer was to intervene as of right by operation of 28 U.S.C.S. § 2631(j)(1)(B) and Ct. Int’l Trade R. 24(a)(1).
• AG der Dillinger Huttenwerke et. Al. v. United States
  • This consolidated action involves a challenge to the final determination in the antidumping (“AD”) investigation conducted by the U.S. Department of Commerce (“Commerce”) of certain carbon and alloy steel cut-to-length plate (“CTL plate”) from the Federal Republic of Germany
  • Since the issue, Commerce’s analysis, and the arguments of the parties are nearly identical to those presented in Dillinger France, the court concludes that a remand is equally appropriate here. Because Dillinger has failed to place information on the record demonstrating the actual cost of production of its non-prime products, Commerce may reasonably rely on facts otherwise available pursuant to § 1677e(a)(1); however, in making its selection of facts otherwise available, Commerce must explain how its reliance on information indicating the “likely selling price” of non-prime products accords with its obligation to ensure that the reported costs of production reasonably reflect the cost of producing the merchandise under consideration

If you have questions about these updates, contact our Diaz Trade Law attorneys at info@diaztradelaw.com or call us at 305-456-3830.

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Customs and Border Protection (CBP)

• According to Custom and Border Protection’s (CBP) de novo review of the administrative record in the EAPA case 7401, including the timely and properly filed request for administrative review, and response thereto, the September 11 Determination of evasion under 19 U.S.C. § 1517(c) is AFFIRMED. 
• According to CBP’s de novo review on remand of the entire administrative record in the EAPA case 7357, including the documents previously omitted from the record and the submissions by Leco Supply and M&B, the October 26 Determination of Evasion under 19 U.S.C. § 1517(c) remains AFFIRMED. 
• According to CBP’s de novo review of the administrative record in the EAPA case 7348, including the timely and properly filed requests for administrative review and responses, the November 2 Determination of evasion under 19 USC § 1517(c) is AFFIRMED. 
• According to CBP’s de novo review of the administrative record in the EAPA case 7395, including the timely and properly filed request for administrative review and response, there is not substantial evidence of evasion. The December 21 Determination finding no evasion under 19 USC § 1517(c) is AFFIRMED. 
• According to CBP’s de novo review of the administrative record in the EAPA case 7281, including the timely and properly filed requests for administrative review submitted by DBMS, Ascension, Crude Chem, GLōB Energy, and UMD on April 20, 2020, as well as the response thereto, we AFFIRM the March 9 Determination by TRLED under 19 U.S.C. § 1517(c). 
• According to CBP’s de novo review of the administrative record in the EAPA case 7335, including the timely and properly filed request for administrative review and response, the November 6 Determination of evasion under 19 USC § 1517(c) is AFFIRMED. 
• According to CBP’s de novo review of the administrative record in the EAPA case 7348, the R&R March 18 FAD and TRLED November 2 Determination of evasion under 19 U.S.C. § 1517(c) are REVERSED. 
• According to CBP’s de novo review of the administrative record in the EAPA case 7321, including the timely and properly filed requests for administrative review, as well as the response thereto, we AFFIRM the June 29, 2020 Determination by TRLED under 19 U.S.C. § 1517(c). 
• According to CBP’s de novo review of the administrative record in the EAPA case 7257, including the timely and properly filed request for administrative review and response, we AFFIRM the determination made by the Director of Enforcement Operations, Trade Remedy & Law Enforcement Directorate, Office of Trade, that pursuant to 19 U.S.C. § 1517 and 19 CFR § 165, substantial evidence exists to support a finding that H & H imported stainless steel flanges from China into the United States through evasion.  
• According to CBP’s de novo review of the administrative record in the EAPA case 7251, including the timely and properly filed request for administrative review submitted by Worldwide on October 31, 2019 and the timely and properly field response submitted by Endura on December 6, 2019, we AFFIRM the September 18 Determination by TRLED under 19 U.S.C. § 1517(c).  
• According to CBP’s de novo review of the administrative record in the EAPA case 7184, including the timely and properly filed request for administrative review and response, the September 17 Determination of evasion under 19 USC § 1517(c) is AFFIRMED. 
• According to CBP’s de novo review of the administrative record in the EAPA case 7232, including the timely and properly filed request for administrative review and response, with respect to the issue of transshipment, the March 20 Determination of evasion under 189 USC § 1517(c) is AFFIRMED, IN PART, with respect to entries of door thresholds on or after December 19, 2018; and REVERSED, IN PART, with respect to entries of door thresholds before December 19, 2018. With respect to the issue of misclassification, the March 20 Determination finding of no evasion is AFFIRMED.  
• CBP will be retiring previously used data resources and is asking those that utilize reports to retrieve Multi-Modal (non-Truck) Manifest data to repoint them to Multi-Modal Manifest data universe. 
• CBP is advising the public that the quarterly Internal Revenue Service interest rates used to calculate interest on overdue accounts (underpayments) and refunds (overpayments) of customs duties will increase from the previous quarter. 

United States Department of Commerce (DOC)

• On September 12, 2022, the Department of Commerce (DOC) extended the deadline by 80 days to complete importer and exporter certifications for entries of certain hardwood plywood products and veneered panels from the People’s Republic of China (A-570-051 and C-570-052) that are assembled in Vietnam and that entered the United States between June 17, 2020, to August 28, 2022. 
• DOC preliminarily determines that certain stainless steel sheet and strip (SSSS) of Chinese-origin that has undergone further processing in the Socialist Republic of Vietnam (Vietnam) is merchandise covered by the scope of the antidumping duty (AD) and countervailing duty (CVD) orders on SSSS from the People’s Republic of China (China).  
• DOC is postponing the deadline for issuing the final determination in the less-than-fair-value (LTFV) investigation of certain lemon juice (lemon juice) from the Republic of South Africa (South Africa) until December 19, 2022, and is extending the provisional measures from a four-month period to a period of not more than six months. 
• DOC, in response to the Russian Federation’s (Russia’s) ongoing aggression against Ukraine, is expanding the existing sanctions against Russia and Belarus by imposing new export controls, including expanding the scope of the Russian industry sector sanctions to add lower-level items potentially useful for Russia’s chemical and biological weapons production capabilities and items needed for advanced production and development capabilities to enable advanced manufacturing across a number of industries. 
• DOC, in accordance with Presidential Proclamation 10414 and pursuant to its authority under section 318(a) of the Tariff Act of 1930, as amended (the Act), is issuing this final rule to implement Proclamation 10414. 

U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC)

• On September 14, 2022, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned ten individuals and two entities for their roles in conducting malicious cyber acts, including ransomware activity. 
• OFAC is publishing a products determination issued pursuant to a March 11, 2022 Executive order.  
• OFAC is issuing Russia-related General License 51  “Authorizing the Wind Down of Transactions Involving Limited Liability Company Group of Companies Akvarius“, and publishing three Russia-related Frequently Asked Questions.  
• OFAC designated one Zimbabwe individual and removed eleven others from the Specially Designated Nationals List (SDN List) under the Zimbabwe sanctions program. 

United States Department of the Treasury (USDT)

• The U.S. Department of the Treasury (USDT) on September 19, 2022, filed a Request for Comment (RFC) to seek feedback from the American people on the illicit finance and national security risks posed by digital assets. 

United States International Trade Commission (USITC)

• The U.S. International Trade Commission (USITC) has received a complaint entitled Certain Automated Put Walls and Automated Storage and Retrieval Systems, Associated Vehicles, Associated Control Software, and Component Parts Thereof (II), DN 3638; the Commission is soliciting comments on any public interest issues raised by the complaint or complainant’s filing pursuant to the Commission’s Rules of Practice and Procedure. 
• USITC received a complaint on August 9, 2022, under the Tariff Act of 1930, as amended, on behalf of Google LLC of Mountain View, California. A supplement was filed on August 24, 2022. 
• USITC has found a violation of section 337 in an investigation regarding plant-derived Recombinant Human Serum Albumins (rHSA). 
• USITC has provided hearing updates for subject reviews on Chlorinated Isocyanurates from China and Spain. 

Office of the U.S. Trade Representative (USTR)

• The Office of the United States Trade Representative (USTR), through the Trade Policy Staff Committee (TPSC), publishes the National Trade Estimate Report on Foreign Trade Barriers (NTE Report) each year. USTR invites comments to assist it and the TPSC in identifying significant foreign barriers to, or distortions of, U.S. exports of goods and services, U.S. foreign direct investment, and U.S. electronic commerce for inclusion in the NTE Report. 

Administrative Law Judge

• The presiding administrative law judge (‘‘ALJ’’) on September 9, 2022, issued an Initial Determination on Violation of section 337. The ALJ also issued a Recommended Determination on remedy and bonding should a violation be found during investigation. 
• The presiding ALJ on August 12,2022, issued an Initial Determination on Violation of section 337. On August 26, 2022, the ALJ also issued a Recommended Determination on Remedy, Bonding, and the Public Interest should a violation be found in the during investigation. 

The White House

• On September 11, 2022, the White House released that The Biden administration plans next month to broaden curbs on U.S shipments to China of semiconductors used for artificial intelligence and chipmaking tools, several people familiar with the matter said. 
• On September 12,2022, President Biden issued executive order 14081 geared towards advancing biotechnology and biomanufacturing innovation for a sustainable, safe, and secure American Bioeconomy. 
• On September 15, 2022, President Biden directed through an executive order the committee that reviews foreign investment for national security risks to sharpen its focus on threats to sensitive data, cyber security and areas such as microelectronics and artificial intelligence. 

United States Department of Commerce (DOC)

• The U.S. Department of Commerce (DOC) determines that carbon and alloy steel threaded rod (steel threaded rod) from India is not being sold in the United States at below normal value.  
•  As a result of the respective determinations by the DOC and the U.S. International Trade Commission (ITC) that termination of the 2016 Agreement Suspending the Antidumping Duty Investigation on Lemon Juice from Argentina (2016 Agreement) and the underlying antidumping duty investigation on lemon juice from Argentina would likely lead to continuation or recurrence of dumping 
• The DOC preliminarily finds that Hangzhou Ailong Metal Products Co., Ltd. (Ailong) made sales of subject merchandise at prices below normal value (NV) 
• On July 29, 2022, the DOC published the preliminary results of the changed circumstances review (CCR) of the antidumping duty (AD) order on multilayered wood flooring (MLWF) from the People’s Republic of China (China). 
• The DOC published a notice in the Federal Register on August 2, 2022, for the preliminary results and partial recission of the 2020–2021 administrative review of the antidumping duty order on certain pasta (pasta) from Italy 
• The DOC preliminarily finds that large power transformers from the Republic of Korea were not sold in the United States at less than normal value during the period of review (POR), August 1, 2020, through July 31, 2021. 
• The DOC preliminarily determines that certain preserved mushrooms (preserved mushrooms) from France are being, or are likely to be, sold in the United States at less than fair value (LTFV). 
• The DOC determines that 15 companies had no shipments of certain frozen fish fillets from the Socialist Republic of Vietnam (Vietnam) during the period of review (POR) August 1, 2020, through July 31, 2021. 

U.S. Court of International Trade (CIT)

• On August 29, 2022, the U.S. Court of International Trade (CIT) issued its final judgment in SeAH Steel Corporation v. United States, Consol. Court No. 20-00150, Slip Op. 22-101, sustaining the DOC’s (Commerce) remand results pertaining to the administrative review of the antidumping duty (AD) order on certain oil country tubular goods (OCTG) from the Republic of Korea (Korea) covering the period September 1, 2017, through August 31, 2018. 
• On August 26, 2022, the CIT issued its final judgment in SeAH Steel Corp. v. United States, Consol. Court No. 19-00086, Slip Op. 22-100, sustaining the U.S. Department of Commerce’s (Commerce) remand results pertaining to the administrative review of the antidumping duty (AD) order on certain oil country tubular goods (OCTG) from the Republic of Korea (Korea) covering the period September 1, 2016, through August 31, 2017. 

U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC)

• The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated Iran’s Ministry of Intelligence and Security (MOIS) and its Minister of Intelligence for engaging in cyber-enabled activities against the United States and its allies. 
• The OFAC is issuing Russia-related General License 13B. 

Food and Drug Administration (FDA)

• FDA is issuing a final rule to reflect changes to the organizational structure of FDA, make the FOIA process easier for the public to navigate, and make certain provisions clearer. Taken together, these changes enhance transparency for the public about FDA activities.

United States International Trade Commission (USITC)

• Purple Innovation, LLC filed a complaint with the U.S. International Trade Commission (USITC) on August 5,2022 alleging violations of patent design and trademark registration based upon the importation, sale for importation, and sale within the United States.  

Office of the U.S. Trade Representative (USTR)

• United States Trade Representative Katherine Tai and Secretary of Commerce Gina M. Raimondo hosted counterparts from the 13 Indo-Pacific Economic Framework for Prosperity (IPEF) partner countries at the first official in-person Ministerial meeting. The ministers announced a substantial milestone in their pursuit of a high-standard and inclusive economic framework.

G7 Germany

• The G7 Finance Ministers met on September 2, 2022 to discuss their response to Russia’s war against Ukraine and its economic impact. They reiterated their support for Ukraine and condemned Russia for their actions.

The White House

• Senior government officials from the United States and Mexico met in Mexico City on September 12th to convene the U.S.-Mexico High-Level Economic Dialogue (HLED).
• On September 11, 2022, the White House released plans to broaden curbs on U.S shipments to China of semiconductors used for artificial intelligence and chipmaking tools.

Bloomberg News

• According to Bloomberg, in Chengdu, famous for its giant pandas, residents in locked-down areas need to remain at home and get tested daily for COVID-19. Those living outside areas deemed to be high risk are only allowed to go out every other day for two hours for groceries and medical needs. 

OFAC

• On April 19, 2022, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued additional public guidance, “Fact Sheet: preserving Agricultural Trade, Access to Communication, and Other Support to Those Impacted by Russia’s War Against Ukraine.” This guidance outlines the many humanitarian and food related authorizations issued by OFAC in support of people impacted by Russia’s war. This guidance provides consolidation information for financial institutions, non-governmental organizations (NGOs), and market participants to more easily access whether they are engaging in authorized or exempt transactions. In addition, OFAC issued a new Russia-related general license to authorize transactions related to certain activities of NGOs in Russia and Ukraine.
• On April 19, 2022, the United States Department of the Treasury’s Office of Foreign Assets Control (OFAC) issued a Fact Sheet for “Preserving Agricultural Trade, Access to Communication, and Other Support to Those Impacted by Russia’s War Against Ukraine.” OFAC has also issued Russia-related General License 27 “Certain Transactions in Support of Nongovernmental Organizations’ Activities.”
• On April 20, 2022, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated Russian commercial bank Transkapitalbank and a global network of more than 40 individuals and entities led by U.S.-designated Russian oligarch Konstantin Malofeyev, for facilitating sanctions evasion for Russian entities. OFAC also designated companies operating in Russia’s virtual currency mining industry. This is the first time Treasury has designated a virtual currency mining company.
• On April 21, 2022, The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) announced a $141,442 settlement with Newmont Corporation (“Newmont”) for four apparent violations of the Cuban Assets Control Regulations (CACR), 31 C.F.R. part 515. Separately, OFAC also announced a $45,908 settlement with Chisu International Corporation (“Chisu”), a company located in Parkland, Florida that is affiliated with a distributor of explosives and accessories for mining operations. Chisu has agreed to settle potential civil liability for four apparent violations of the Cuban Assets Control Regulations (CACR), 31 C.F.R. part 515.

USTR

• On April 20, 2022, The United States and the Socialist Republic of Vietnam today convened the first meeting of the Timber Working Group under the Timber Agreement announced in October 2021. This first meeting of the Discussions focused on Vietnam’s progress to date to implement its commitments under the agreement, as well as current and potential future technical assistance and capacity building activities.

USITC

• On April 21, 2022, the International Trade Commission issued notice that the presiding administrative law judge (“ALJ”) issued an Initial Determination on Violation of Section 337. On April 15, 2022, the ALJ issued a Recommended Determination on Remedy and Bonding (“RD”) should a violation be found in the above-captioned investigation. The Commission is soliciting submissions on public interest issues raised by the recommended relief should the Commission find a violation.
  • Written submissions must be filed no later than by close of business on May 16, 2022.

If you have questions about these updates, contact our Customs and International trade law attorneys at info@diaztradelaw.com or call us at 305-456-3830.

The Bureau of Industry and Security (BIS) 

• BIS published a report summarizing the findings of a Department of Commerce investigation into the effect of imports of titanium sponge on the national security of the United States.
• BIS is seeking public comments concerning the imposition of export controls on certain Brain-Computer Interface (BCI) emerging technology, particularly with respect to its impact on U.S. national security
  • Comments due by December 10, 2021.
  • Contact us at info@diaztradelaw.com for help submitting your comment.
• BIS published this final rule to amend the Export Administration Regulations (EAR) to update the AG Common Control List for dual-use biological equipment.
  • This rule is effective October 5, 2021.

International Trade

• IMF slashes US growth forecast and warns of rising risks to the global economy amid supply chain disruptions and softening consumption.
• 136 countries agree to historic deal implementing a 15% minimum corporate tax rate.

Office of Foreign Assets Control (OFAC) 

• OFAC sanctions Libyan national Osama Al Kuni Ibrahim, who is responsible for serious human rights abuse against migrants in Libya.
• OFAC publishes six Ukraine-related web general licenses (GLs) in the Federal Register: GL 16, GL 16A, GL 16B, GL 16C, and GL 16D, and GL 16E.

U.S. Government 

• U.S. Customs and Border Protection (CBP) is seeking comments on launch of a Global Business Identifier (GBI) Evaluative Proof of Concept (EPoC) aimed at determining a single identifier solution that will uniquely discern main legal entity and ownership; specific business and global locations; and supply chain roles and functions.
  • Comments due by December 6, 2021
  • Contact us at info@diaztradelaw.com for help submitting your comment
• U.S. Department of Labor seeks trade community’s input on three reports issued by the Bureau of International Labor Affairs regarding child labor and forced labor in certain foreign countries.
  • Comments due by January 15, 2022.
  • Contact us at info@diaztradelaw.com for help submitting your comment.

United States Trade Representative (USTR)

• USTR files a request for a Section 332 investigation on the distributional effects of goods and services trade and trade policy to build upon the Biden Administration’s goals of a worker-centric trade policy that is inclusive for all Americans.
• USTR closes investigations into Vietnam‘s acts, policies and practices related to illegal logging and timber trade.
• USTR opened a web portal for importers and other interested parties to comment on whether the USTR should renew certain China tariff exclusions that had previously expired.
  • If you would like assistance submitting a comment about exclusions for your product, reach out to us today.
• USTR Katherine Tai speaks on reimplementation of a targeted tariff exclusion process in speech outlining the Biden-Harris Administration’s new approach to the U.S.-China bilateral trade relationship.

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A lot has happened in the first 6 months of the Biden administration. Notable developments include (at least temporary) resolutions in the large civil aircraft and digital service tax disputes, consensus around a global minimum corporate tax of 15%, lawsuits pertaining to Section 232, increased export controls enforcement, shifting U.S. policy stances on Cuba, and more. However, the most important developments pertain to the ongoing U.S.-China trade war. The U.S. and China are engaged in ongoing negotiations while tensions have risen, a lawsuit challenging Trump’s imposition of 301 tariffs are underway, and a massive U.S. competitiveness bill is being considered in Congress that could bring back broad China tariff exclusions. Join us for a jam-packed hour where we discuss everything that has happened in the world of U.S. trade policy over the past 6 months, and provide insight into how Biden’s trade policies affect industry.

Register today to hear from this experienced trio:

• Todd C. Owen is the former Executive Assistant Commissioner, U.S. Customs and Border Protection (CBP), Office of Field Operations (OFO). As the senior executive for the Office of Field Operations for over 5 years, Mr. Owen was responsible for all operations at the 328 ports of entry in the United States, as well as overseas operations in 32 countries.
• President and Founder of Diaz Trade Law, Jennifer (Jen) Diaz is a Chambers ranked, Board Certified International Attorney specializing in customs and international trade.
• Associate Attorney of Diaz Trade Law, Sharath Patil, assists U.S. manufacturers, distributors, and importers with a range of export compliance and enforcement matters pertaining to the U.S. Department of Commerce; the U.S. Treasury Department; the U.S. State Department; and more.

This one-hour webinar provides an overview of President Biden’s Trade Policy six months into his presidency, an update on CBP enforcement actions, and a summary of Congressional actions pertaining to trade policy.

In This Webinar You Will Learn:

• An Update on the Status of the Section 301 Lawsuit
• An Overview of Key Developments in the U.S.-China Trade War under Biden’s Administration
• Congressional Developments under Biden
• Status of CBP Enforcement Efforts under Biden
• Recent Developments in the Miscellaneous Tariff Bill and Generalized System of Preferences
• The Impact of Economic Stimulus Efforts on Trade Flows
• An Update on USMCA Implementation
• The Latest on U.S.-Cuba Trade
• And Many Other Developments

Who Should Attend:

• Importers/Exporters
• Customs Brokers
• Regulatory Affairs Professionals
• In-house Legal Counsel
• Product Development Managers
• Others Interested in Trade Policy

This webinar is eligible for continuing education credit from the NCBFAA Educational Institute. Space is limited, registration required! Access instructions will be provided after your registration is complete. Don’t just take our word for how awesome Diaz Trade Law webinars are. Click here to see what our past attendees had to say. Be sure to join us on July 28, 2021!

Antidumping duty (“AD”) and countervailing duty (“CVD”) investigations are brought jointly by the U.S. International Trade Commission (“USITC”) and the U.S. Department of Commerce (“Commerce”). AD investigations are triggered when a domestic industry alleges that it has been injured by competing imports of particular goods from specific countries being sold at less than a fair value. Meanwhile, CVD investigations are triggered when a domestic industry alleges that it has been injured by competing imports that are being unfairly subsidized by their governments. The domestic industry initiating the investigation is known as the petitioner while the foreign industry participating in the investigation is known as the respondent.

What Happened

On April 21, 2021, the American Honey Producers and the Sioux Honey Association (“petitioners”) filed a petition with the USITC and Commerce alleging that certain honey imports from five countries are sold in the United States at less than fair value. The countries named in the petition are India, Brazil, Argentina, Ukraine, and Vietnam. The petitioners alleged an AD margin of approximately 34-99% for India, 115% for Brazil, 17-22.5% for Argentina, 10.5-95% for Ukraine, and 207% for Vietnam.

Scope of Petition

The United States has previously investigated honey and there is an extant order on all honey from China. This investigation covers a different product range as it covers raw honey imported in packages greater than 5 pounds (bulk) and does not cover processed honey or honey imported in retail packaging. The limited scope of this investigation is an unusual decision. We believe that the scope is so limited because of potential weaknesses in the cases. As it also ignores the higher priced processed honey industry, it could result in a shift of more product into the processed honey channel and eventually lead to a case on processed honey.

Estimated Schedule of Investigations

The USITC will issue its preliminary determination in 45 days. Commerce should initiate this case in 20 days, and the date of the preliminary determination, which controls the date of duty deposit, will be either September 28, 2021 if the case is not extended, or November 17, 2021 if the case is found to be complicated and thus extended.  The order, if issued, will be issued sometime between February 2, 2022 and May 23, 2022.

What You Should Do

AD/CVD investigations can result in determinations adverse to respondent interests for years that could effectively prohibit access to the U.S. market. Failure to effectively participate in investigations can put exporters and importers at a significant disadvantage.

Diaz Trade Law and its experienced network of Of Counsel experts have many years of experience and a strong track record of success on AD/CVD matters. Diaz Trade Law represents its clients in the following AD/CVD services:

• Initial investigations
• Annual administrative reviews
• Sunset reviews
• Calculation and legal analysis of dumping calculation methodology in both market economy and non-market economy cases
• Scope ruling requests
• New shipper reviews
• Circumvention inquiries
• Appeals of determinations

Contact Us

Diaz Trade Law has significant experience on AD/CVD proceedings. If you would like to have Diaz Trade Law represent you on this or any other AD/CVD matter, contact Diaz Trade Law today at info@diaztradelaw.com or 305-456-3830.

 USTR’s Tougher Stance on Vietnam

 The Trump administration has begun to exercise a tougher stance against Vietnam. The United States Trade Representative (“USTR”) initiated two Section 301 investigations against the Southeast Asian country on October 2, 2020. The focus of the two investigations are Vietnam’s acts, policies, and practices related to (1) the valuation of its currency, and (2) Vietnam’s importation and use of illegal timber. The news of USTR’s launch of these dual investigations came days before the U.S. Census Bureau’s latest trade data release – which indicated that the U.S. trade deficit in goods with Vietnam is at record levels, registering at $42.7 billion in the 8 months of data available for 2020. This skyrocketing trade deficit is relevant to U.S. trade policy towards Vietnam because one of President Trump’s key economic pledges was to lower the U.S. trade deficit with trading partners. A well-documented pattern of transshipment of goods from China through Vietnam to avoid U.S. Section 301 duties towards China could also explain Vietnam being targeted.

What are Section 301 Investigations?

Section 301 investigations refer to cases launched by the USTR under the authority of Section 301 of the Trade Act of 1974. The statute provides the president of the United States with the authority to take “all appropriate and feasible action” to obtain the removal of any act, policy, or practice of a foreign government that violates a trade agreement or is unjustifiable and burdens U.S. commerce. Section 301 cases can be self-initiated by the USTR or be initiated as a result of a petition filed by industry. Once USTR launches a Section 301 investigation, the agency must seek to negotiate a settlement with the foreign country in which a problematic trade barrier is eliminated or the United States is otherwise compensated for the burden imposed on U.S. commerce.

The two investigations launched against Vietnam will join several other cases already on the USTR’s 301 docket:

• Technology Transfer, Intellectual Property, and Innovation in China
• Large civil aircraft
• France’s Digital Services Tax
• Digital Services Taxes in Austria, Brazil, the Czech Republic, the European Union,

India, Indonesia, Italy, Spain, Turkey, and the United Kingdom

Why Vietnam?

USTR’s two new 301 investigations of Vietnam pertain to currency issues and timber concerns. We will discuss each of these disputes, in turn.

Currency Concerns

Currency disputes are a hallmark of trade geopolitics. The U.S. Treasury Department’s bi-annual report, Macroeconomic and Foreign Exchange Policies of Major Trading Partners of the United States, monitors the exchange rate policies and currency activities of the United States’ largest trading partners. If certain statutory criteria are met, the Treasury Department labels a foreign country a currency manipulator. The Treasury report evaluates the U.S.’ largest trading partners against that statutory criteria. As a result of the analysis in these biannual currency reports, the Treasury Department designated China a currency manipulator in August 2019. That designation was withdrawn in January 2020 as part of U.S.-China trade negotiations.

In recent years, the currency reports have closely monitored the activities of Vietnam, as well. According to the USTR, the Vietnamese government tightly manages the value of the Vietnamese đồng through the State Bank of Vietnam (“SBV”). Based on Treasury’s currency reports and other available analysis, USTR found that the Vietnamese government had undervalued the đồng on a real effective basis by 7 percent in 2017 and 8.4 percent in 2018, which further undervaluation identified in 2019. Countries undervalue their currency for a trade advantage – it lowers the prices of their exports. The issue vexes the U.S. government’s efforts to have fair and balanced trade relationships. The Council of Foreign Relations’ currency manipulation tracker shows that Vietnam was the worst offender across three criteria identified by the Treasury Department. Vietnam’s devaluation of the đồng artificially increases demand for Vietnamese exports and inflates the already-high trade deficit the U.S. has with that country. Vietnam will now join China in being subject to 301 scrutiny on the basis of currency concerns.

Timber Concerns

The subject of USTR’s second investigation is Vietnam’s acts, policies, and practices related to the import and use of illegal timber. According to the USTR, Vietnam is one of the world’s largest exporters of wood products. In fact, in 2019, Vietnam exported more than $3.7 billion worth of wooden furniture to the United States. Vietnamese wood product manufacturers rely on imported timber as inputs to their finished products. USTR has found that Vietnam’s timber imports were illegally harvested on protected lands in Cambodia, Cameroon, and the Democratic Republic of the Congo in violation of those countries’ laws. Furthermore, USTR found that Cambodian exports of timber to Vietnam may have violated Cambodia’s log export ban. Vietnam’s timber import and use practices may involve Lacey Act violations, as well.

Record Trade Deficits

Year-to-date 2020 data shows that the United States’ goods trade deficit in Vietnam is higher in the first eight months of 2020 than the first eight months of any preceding year. The U.S. goods trade deficit with Vietnam so far this year is a whopping $42.7 billion after adjusting for inflation. This is 17.8 percent higher than the same period in 2019, and 402 percent higher than the same period ten years ago in 2020. A key Trump administration pledge has been to reduce the U.S. trade deficit. However, many mainstream economists believe that trade deficits are a poor metric for a country’s economic well-being and that U.S. trade policy should not be based on reducing trade deficits.

Reaction in Vietnam

USTR’s actions have triggered widespread concern among Vietnam’s business community. “Everybody is concerned, especially investors in Vietnam who moved their factories from China,” said Ernie Koh, director of Singapore furniture manufacturer Koda, which has manufacturing facilities in Vietnam. “This will definitely have an impact on our business, especially for those kitchen cabinet manufacturers who export to the US, but there is nothing to worry about for non-US exporters at this stage,” said Niu Qiang from the Chinese Chamber of Commerce in Ho Chi Minh City.

Virtual Hearing

The USTR will convene virtual public hearings for both investigations. The timber investigation hearing will be held on December 28, 2020 at 9:30am ET, and the currency investigation hearing will be held on December 29, 2020 at 9:30am ET.

Diaz Trade Law can assist you with:

• Submitting a request to appear (the deadline for filing a request is December 10, 2020)
• Preparing a testimony or testifying on behalf of your organization about USTR’s Section 301 investigations
• Preparing and submitting post-hearing rebuttal comments by January 6, 2021 and January 7, 2021 for the timber and currency hearings respectively

Contact Us!

Diaz Trade Law, P.A. has extensive expertise on Section 301 tariff matters. In September, we represented over 100 importers in drafting a complaint with the U.S. Court of International Trade to request refunds for List 3 and List 4 301 China tariffs paid. If you have questions about Section 301 tariffs or would like to participate in the Vietnam investigation hearing through testimony or post-rebuttal comments, reach out to us at info@diaztradelaw.com.

All trade data is sourced from the U.S. Census Bureau and adjusted for inflation to base month August 2020.