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Trump Signs Steel, Aluminum Product Exclusions

Wednesday, September 5, 2018

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Last week, President Donald J. Trump signed a proclamation allowing Secretary of Commerce Wilbur Ross to give targeted relief from quotas limiting steel and aluminum imports from select countries.

What Does This Mean?

The order, signed on Aug. 29, gives relief on quotas limiting steel imports from South Korea, Argentina and Brazil and aluminum from Argentina.

© iStock.com / Leonid Eremeychuk

Last week, President Donald J. Trump signed a proclamation allowing Secretary of Commerce Wilbur Ross to give targeted relief from steel and aluminum quotes to select countries.

When Trump first imposed steel and aluminum tariffs in March, quotas were placed on those countries instead of tariffs; while extra duties aren't tacked onto the cost of imports from the countries, imports are limited so that they cannot send more product to the United States than they have in recent years.

Much like exemptions from the tariffs, though, there is still an application process for companies that believe the products they import should be exempt from the quotas.

“Companies can apply for product exclusions based on insufficient quantity or quality available from U.S. steel or aluminum producers,” the order states. “In such cases, an exclusion from the quota may be granted and no tariff would be owed.

“In a limited number of cases, steel articles are being used in a facility construction project in the United States that were contracted for purchase prior to the decision to impose quotas, and cannot presently enter into the United States because a quota has already been reached. In such a case, an exclusion from the quota may be granted, but the product may only be imported upon payment of the 25 percent tariff.”

Exemption Background

The exemption process in general has been under fire for some time and was most recently called into question last month when Sen. Ron Johnson, R-Wisconsin, reportedly wrote to Ross questioning the “arbitrary nature” of the exemptions.

© iStock.com / zhaojiankang

The exemption process in general has been under fire for some time and was most recently called into question last month when Sen. Ron Johnson, R-Wisconsin, reportedly wrote to Ross questioning the “arbitrary nature” of the exemptions.

The tariffs, instituted over a period of months this spring and affecting steel from other countries across the globe, including China, Canada and the European Union, assign duties of 25 percent on steel products and 10 percent on aluminum.

Companies that feel they need to use steel or aluminum from another country—because that particular product isn’t made in the U.S., for example—may apply for an exemption, but others can take advantage of the public comment period on the exemption requests and file an objection.

In many cases so far, steelmakers have filed objections to other companies’ exemption requests; some of the companies whose exemptions are in question have accused steelmakers of dishonesty in their objections.

In Johnson’s letter, he wanted to address the process on behalf of manufacturers in his state that say the tariff s have hurt them. One business, he said, has had to pay $2.6 million in tariff costs after being denied an exemption by Commerce.

The New York Times reported that about half of all exemption denials came on requests that had been objected to by U.S. Steel, Nucor or AK Steel. The other half, the newspaper reported, came as a result of errors in the exemption submissions.

   

Tagged categories: Aluminum; Government; Laws and litigation; Steel

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