301 Tariff Escalation Scheduled for March 2, 2018

(The following information is from Michael Best Strategies, and the author is Denis Bode, partner.)

At the direction of the President, the U.S. Trade Representative (Trade Representative) has determined to modify the action being taken in the Section 301 investigation from postponing the date on which the rate of the additional duties will increase to 25 percent for the products of China covered by the September 2018 action. As set out in this notice, the rate of additional duty for the products covered by the September 2018 action will increase to 25 percent on March 2, 2019.

President Donald Trump's short-term deal with Chinese President Xi Jinping held up the increase on more than $200 billion worth of Chinese goods, planned for Jan. 1, until after the 90-day window. The notice confirms there won't be any wiggle room at the deadline, adding pressure in the ongoing talks.
So far, China has agreed to buy more U.S. farm and energy goods and to lower its tariffs on automobiles. Beijing is also reportedly rewriting its controversial Made in China 2025 policy, which the U.S. has accused of trying to dominate advanced technologies at the expense of U.S. companies.

Still, U.S. officials said that China has agreed to take specific steps to protect U.S. technology. Earlier this month, White House trade adviser Peter Navarro said the 90-day period will result in "actual structural changes that will yield actual, immediate, verifiable results."