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In brief

On 5 April 2021, the US Court of International Trade (Court) issued a significant ruling that overturns a portion of the Section 232 tariffs imposed by President Trump under Section 232 of the Trade Expansion Act of 1962 (19 U.S.C. §1862). The decision affects the duties imposed on US imports of steel and aluminum “derivative” products but not the more general steel and aluminum tariffs. The Court found that President Trump missed the statutory deadline when he extended Section 232 tariffs to cover steel and aluminum derivative products more than two years after he received the original Section 232 report. In particular, the President failed to issue the proclamation expanding the duties within the 105-day window beginning upon receipt of the investigation report issued by the Secretary of Commerce. The decision may provide a path to meaningful relief (i.e., refunds and future imports with no Section 232 duties) to importers of these products and also provides important precedent for the ongoing litigation challenging the Section 301 tariffs imposed on Chinese goods.


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This recent decision follows an earlier one in the same proceeding (Slip Op 21-8, dated 27 January 2021), in which the Court denied both the government’s motion to dismiss and the plaintiff’s motion for summary judgment, meaning the Court ordered additional briefing on the critical question of when the 105-day period began. The US Government declined to submit additional evidence on this question, and the Court concluded that the government therefore waived an argument that it complied with the 105-day time limit. After finding the President’s actions unlawful, the Court ordered covered entries to be liquidated without the assessment of duties and refunds of past duties paid by the plaintiff.

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The decision is subject to appeal. However, importers of derivative steel and aluminum products should assess the status of entries immediately and preserve rights to refunds, including through the filing of protests or post-summary corrections. The “derivative” steel products covered by the action include nails, tacks, drawing pins, corrugated nails, staples, bumper stampings of steel, certain accessories of motor vehicles, and body stampings of steel for tractors suitable for agricultural use. The “derivative” aluminum products covered by the action include stranded wire, cables, plaited bands, and slings, whether or not with steel core. Further guidance from US Customs and Border Protection may follow, but action is likely needed to seek immediate relief.

Section 301 Tariffs:

In addition, the timeliness of the President’s actions under trade statutes is a central issue in the ongoing Section 301 litigation, where nearly 4,000 complaints have been filed challenging the expansion of tariffs on Chinese imports through two additional “lists” of covered products.

For further details, please contact the authors or the Baker McKenzie lawyer with whom you regularly work.

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Author

Kevin O'Brien is a partner in Washington, DC and former Chair of the North America Intellectual Property Practice Group. Mr. O'Brien has served as Co-Chair of the Patent Litigation Committee of the Federal Circuit Bar Association and has taught a course on Trade and Competition at Johns Hopkins University. He is currently Chair of the Trade Secrets Business Unit of the Global IPTech Group. He has more than 30 years of experience practicing in the areas of intellectual property and international trade law, with an emphasis on counseling and enforcement. Mr. O'Brien has been recognized as a leading lawyer by Chambers USA (District of Columbia) and has been selected as one of the "best lawyers" for IP law in Best Lawyers in America and in the Legal 500.

Author

Christine Streatfeild is a partner in the IPTech Practice Group. She has a broad range of trade, regulatory, and litigation experience, most frequently representing clients in antidumping and countervailing duty cases, safeguard measures, duties imposed for national security purposes (Section 232 duties), and Section 337 intellectual property and trade secrets disputes. She appears before the US International Trade Commission (ITC), US Department of Commerce (DOC), and the federal courts. She also routinely advises companies regulated by the Food and Drug Administration (FDA) on issues affecting mergers, acquisitions, licensing, and compliance. Prior to joining Baker McKenzie, Ms. Streatfeild served as the acting deputy director of the Generalized System of Preferences (GSP) and in the Environment and Natural Resources division of the Office of the United States Trade Representative. She has also served as an adjunct professor at the Krieger School, Johns Hopkins University, where she taught Global Trade, Policy and Competition.

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Caroline Bisk is a Contractor Attorney in Baker McKenzie Washington, D.C. office.

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Riza Buditomo is a partner in Hadiputranto, Hadinoto & Partners' Tax & Trade Group in Jakarta. He focuses on corporate commercial and tax, and trade matters including export/import, customs, supply chain, food industry, direct-selling, anti-dumping, and corporate commercial work.

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Junko Suetomi is a partner in Baker McKenzie Tokyo. Prior to joining the Firm, she worked in the WTO Dispute Settlement Division of the Ministry of Foreign Affairs' Economic Bureau. She has also worked for a global law firm in Washington, DC and New York, and served as a court-appointed defense attorney in many criminal cases. Junko is recognized as a leading lawyer by Chambers Global and Chambers Asia Pacific, Best Lawyers, Who's Who Legal and other legal directories. She is the Chair of the Human Rights Committee of the Tokyo Bar Association and a part-time lecturer at Waseda University. She was a legal advisor to the Ministry of Finance Japan's Office of Trade Remedy Affairs, Tariff Policy and Legal Division, Customs and Tariff Bureau from 2016 to 2019. She has served as an expert member of the Ministry's Council on Customs, Tariff, Foreign Exchange and Other Transactions since 13 March 2019.

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Adeline Wong heads the Tax Practice Group of Wong & Partners. She has more than 25 years of experience in the area of corporate tax planning, advisory, audit and investigation work. She has presented in both domestic and international tax conferences, including conferences organised by the Tax Executive Institute in the US, Society of Trust and Estate Practitioners in Singapore and more recently, Bloomberg BNA's Global Transfer Pricing Conference in Shanghai. She is also a regular contributor to established publications on tax-related legislation and developments in Malaysia, such as Bloomberg BNA and the International Bureau of Fiscal Documentation.

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Ivy Tan is an Associate in Baker McKenzie's Hong Kong office.

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