Carper, Portman, 38 Colleagues Urge U.S. Trade Representative to Help U.S. Manufacturers, Restart the Exclusion Process for Imports Subject to Tariffs on China

WASHINGTON, D.C. – Today, U.S. Senators Tom Carper (D-Del), Chairman of the Senate Finance Committee’s International Trade, Customs, and Global Competitiveness Subcommittee, and Rob Portman (R-Ohio) along with 38 other members of the Senate, sent a letter to U.S. Trade Representative Katherine C. Tai, asking her to restart the exclusion process for imports from China subject to tariffs under Section 301 of the Trade Act of 1974. The Trump administration set up an exclusion process to help U.S. manufacturers and businesses receive relief from the tariffs when an imported good was not available outside of China, or when the tariffs caused severe economic harm to U.S. industry. Unfortunately, those exclusions expired at the end of 2020, and the Biden administration has not restarted a process for businesses to apply for new exclusions.

“In order to provide certainty and predictability to these businesses, and give them time to plan and modify their supply chains, we ask that you renew expired and expiring Section 301 exclusions. Doing so will give American businesses relief until a full exclusion process can be reinstated,” wrote the Senators. “We were pleased to see the Biden Administration renew exclusions granted by the Trump Administration for health-related imports to fight the COVID-19 pandemic. Over the longer-term, we hope that you will restart a process to permit companies to apply for exclusions. Such a process should emphasize transparency, speed, consistency, and fairness, and should acknowledge both the practical realities of global value chains and the broader aim of supply chain diversification.”

The full text of the letter is below and can be found here.

Dear Ambassador Tai,

Congratulations on your confirmation to be the U.S. Trade Representative. We look forward to working with you in your new role. We write today to ask you to restart the exclusion process for imports from China subject to tariffs under Section 301 of the Trade Act of 1974.

As members concerned about China’s unfair trade practices, we support efforts to challenge the inequities in our trade relationship with China. The use of industrial subsidies, State-Owned Enterprises (SOEs), and intellectual property theft, has cost countless American jobs and placed enormous strain on the multilateral trading system. These inequities demonstrate the imperative to hold China accountable and take seriously its non-market acts, policies, and practices.

At the same time, we strongly support our domestic manufacturers and small businesses, and the jobs and innovation that they contribute to our economy. In doing so we recognize a practical reality—at this time, especially during a global pandemic, some inputs for American manufacturers and small businesses remain unavailable outside of China. We were pleased to see a tariff exclusion process that attempted to accommodate that reality. Unfortunately that process expired on December 31, 2020.

In order to provide certainty and predictability to these businesses, and give them time to plan and modify their supply chains, we ask that you renew expired and expiring Section 301 exclusions. Doing so will give American businesses relief until a full exclusion process can be reinstated. We were pleased to see the Biden Administration renew exclusions granted by the Trump Administration for health-related imports to fight the COVID-19 pandemic. Over the longer-term, we hope that you will restart a process to permit companies to apply for exclusions. Such a process should emphasize transparency, speed, consistency, and fairness, and should acknowledge both the practical realities of global value chains and the broader aim of supply chain diversification.

We believe that we can address the inequities in our trade relationship with China without inhibiting the competitiveness and capacity of American businesses and manufacturers. There are constructive ways to support domestic manufacturing, assertively challenge China’s unfair trade practices, and help companies diversify supply chains, which may include investing in other countries in the Asia-Pacific region, or re-locating production to the Western Hemisphere or United States.

We thank you for your support for holding China accountable to its commitments to treat American exports of goods and services fairly, and we look forward to working together to ensure that these commitments are met and enforced.

Thank you for your consideration.

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