Overview
On May 4, 2020, the US Department of Commerce (Commerce) announced in a press release that it will initiate an investigation pursuant to Section 232 of the Trade Expansion Act of 1962 (the TEA) into whether laminations for stacked cores for incorporation into transformers, stacked and wound cores for incorporation into transformers, electrical transformers, and transformer regulators are being imported into the United States in such quantities or under such circumstances as to threaten to impair the national security.
According to the Commerce press release, “{l}aminations and cores made of grain-oriented electrical steel are critical transformer components” and “{t}ransformers are part of the U.S. energy infrastructure.”
Commerce also noted that, “{e}lectrical steel is necessary for power distribution transformers for all types of energy – including solar, nuclear, wind, coal, and natural gas – across the country” and that “{a}n assured domestic supply of these products enables the United States to respond to large power disruptions affecting civilian populations, critical infrastructure, and US defense industrial production capabilities.”
The TEA provides Commerce with 270 days following the initiation of the investigation to submit a report to the President assessing whether the investigated imports threaten to impair the national security and providing recommendations based on such findings. The President then has an additional 90 days to determine whether he will accept or reject the findings of the report, and to decide the nature and duration of the action, if any, he will take to adjust imports of the concerned product into the United States.
In theory, Commerce could conduct its investigation on an expedited basis, permitting the President to impose remedies well before the end of year.
