Overview
On December 14, 2020, the U.S. Department of Commerce’s Bureau of Industry and Security (“BIS”) is scheduled to publish an interim final rule modifying certain elements of the exclusion process for steel and aluminum imports subject to tariffs pursuant to Section 232 of the Trade Expansion Act of 1962 (“Section 232”). When President Trump imposed Section 232 tariffs on imports of steel and aluminum, Commerce was directed to set up a process that allows companies to request exclusions for products that are not “produced in the United States in a sufficient and reasonably available amount or of a satisfactory quality.” BIS had previously issued three interim final rules regarding the exclusion process. The new rule responds to some of the comments received in response to those prior interim final rules, with the following key changes:
- The Creation of General Approved Exclusions (“GAEs”): For certain products that have not received objections in the past, BIS will issue GAEs. Unlike regular Section 232 tariff exclusions, GAEs can be used by any importing entity, do not have a quantity limitation, and will last for an indefinite period of time. However, companies cannot obtain retroactive refunds on tariffs using a GAE. Companies should check if any of their imported products are among the listed GAEs.
- New Certification Requirements: Due to concerns that requesters are asking for higher than necessary amounts in their exclusion requests, companies will be subject to additional certification requirements regarding requested volumes.
- Revising the Definition of “Immediately”: Previously, material was considered to be available “immediately” from domestic producers if it could be provided within eight weeks. The new rule adjusts that definition so that “immediately” either means produced and delivered within eight weeks, or produced and delivered in a timeframe that is equal to or earlier than the time required to obtain the product from the requester’s foreign supplier.
In addition to these modifications, BIS also clarified the language in certain parts of the rule, and changed the page limits on attachments that companies can submit during the exclusion process. Comments on this rule are due on February 12, 2021. BIS noted that it expects to issue at least one more interim final rule in response to comments it has received about the exclusion process.
