US Trade Representative (USTR)

Much of the tech industry -- though CTA was silent -- blasted the Trump administration Tuesday for announcing it plans to go ahead with 25 percent Trade Act Section 301 tariffs on $50 billion worth of Chinese imports. The products affected won’t be known until the U.S. Trade Representative's office releases its final tariffs list by June 15. Tariffs will be imposed “shortly thereafter,” said the White House.

CTA, the National Retail Federation and 50 other trade groups from various industries want the U.S. Trade Representative’s office to “immediately make public” the details of the Trade Act Section 301 "process" it will use to add more Chinese-sourced products to the proposed 25 percent tariffs list, if it heeds the suggestions of "several stakeholders” to do so, they said in comments posted Thursday in docket USTR-2018-0005. “We strongly believe there needs to be additional public input for any products that USTR is considering adding to the proposed list,” said the comments, which also were signed by the Information Technology Industry Council, the Internet Association and the Telecommunications Industry Association.

Proposed new 25 percent tariffs on products from China will be put "on hold" while the Trump administration tries to "execute the framework" of a trade deal with China, Treasury Secretary Steven Mnuchin said in an interview on Fox News Sunday. "I'm pleased to report that we've made very meaningful progress and we've agreed on a framework, which is important to understand, and the framework includes their agreement to substantially reduce the trade deficit by increasing their purchasing of goods," he said of the talks with the Chinese. China and the U.S. released a joint statement Saturday saying both sides are aligned on the "importance of intellectual property protections, and agreed to strengthen cooperation," among other terms. Comments are due Tuesday in docket USTR-2018-0005 to rebut statements made in three days of hearings the U.S. Trade Representative's office held last week on the proposed tariffs (see 1805160067 or 1805160020). USTR Robert Lighthizer wants "real work" for "changes in a Chinese system that facilitates forced technology transfers in order to do business in China and the theft of our companies’ intellectual property and business know how," he said in a statement his office emailed us Monday. "Getting China to open its market to more U.S. exports is significant, but the far more important issues revolve around forced technology transfers, cyber theft and the protection of our innovation. As this process continues the U.S. may use all of its legal tools to protect our technology through tariffs, investment restrictions and export regulations. Real structural change is necessary." Despite the Trump administration's pause in adding tariffs on goods from China, it's too early to end efforts on product exemptions, Baker McKenzie lawyer Ted Murphy blogged. "While this is a positive development, it is also subject to change," he said. "For now, we are recommending that companies continue to pursue exclusions just in case."

CTA "remains opposed" to the use of tariffs to address the "imbalance" in the U.S.-China trade "because of the high likelihood of short- and long-term negative consequences," said Sage Chandler, vice president-international trade, in written testimony sent to us Wednesday on the second day of hearings (see 1805150074) before the U.S. Trade Representative’s office on proposed 25 percent tariffs. Some members, "including innovative startups," fear this would "put them at a disadvantage relative to their competitors in other nations," she said. Prices will rise an average of 23 percent on TVs and other consumer products if the proposed tariffs for Chinese intellectual property issues are imposed, said David French, National Retail Federation senior vice president-government affairs, in written testimony Wednesday. The Internet Association appreciates the administration “is trying to address” the “trade barriers” that block U.S. internet services from penetrating China, depriving them of “billions of dollars in potential business,” testified Jordan Haas, director-trade and international policy, Wednesday. “Tariffs, however, are the wrong solution.” Internet companies “understand that tariffs are hidden, regressive taxes that will be paid by the U.S. consumer in the form of higher product prices and by hurting companies’ ability to invest in future technology,” he said. Many of the products on the proposed tariff list are consumer goods, including TVs, and tariffs on them would be “problematic for internet companies,” so they should be removed, said Haas. The National Electrical Manufacturers Association agrees the levies "will not help support and could materially injure the global competitiveness of our industries," said Kyle Pitsor, vice president-government relations, in written testimony Wednesday.

The U.S. Trade Representative’s office accepted CTA’s request for Sage Chandler, vice president-international trade, to testify at the May 15 hearing in opposition to the Trump administration’s proposed 25 percent tariffs over intellectual property disputes on certain goods imported from China (see 1804050005), a CTA spokeswoman emailed us Thursday. “U.S. imports of products from China that are on the USTR proposed tariff list" include products members import, Chandler commented, posted Wednesday in docket USTR-2018-0005.

It’s “time for quick action” for companies that want to sway the U.S. Trade Representative’s office against imposing Trade Act Section 301 tariffs of 25 percent on 1,200 classifications of goods imported from China in the list released Tuesday (see 1804040054 or 1804040023), said DLA Piper in an "international trade alert." Companies “have the opportunity to present their views on specific products listed under the proposal for higher tariffs before the list is finalized and the tariffs become effective, in an effort to seek the removal of a product from the final list,” said the law firm Wednesday. Written comments are due May 11, with an April 23 deadline for requesting to appear at a May 15 public hearing, it said. May 22 is the deadline for written comments to “rebut statements made at the hearing,” it noted. The USTR notice spells out how someone who wants a product removed from the list should file comments and what those comments should say, said the alert: Commenters “should explain why the inclusion of the specific product will not be effective in curbing China's actions that are targeted by this Section 301 action, and also how the tariff would negatively impact US persons (including the affected company and its customers)." USTR didn't comment Thursday on whether the May 15 public hearing at the International Trade Commission building will be streamed live. The agency's recent history has been to hold hearings "off-camera." U.S.-threatened sanctions and the Chinese response to "reciprocate" are likely stage setting for future negotiations, Merrill Lynch analysts emailed investors. "Despite the exchange of tariff threats, we believe there is still room for negotiation between the US and China," said Helen Qiao and Sylvia Sheng Tuesday. "We maintain our view that China will continue its 'carrot and stick approach,' threatening retaliation but also proposing to expand its imports of US products, cut the auto duty, and ease restrictions for US companies investing and selling in China," they said. "We expect the final version of both the US and China trade measures to be more toned down."

TVs imported from China would bear an especially heavy burden under the U.S. Trade Representative’s list of products targeted for 25 percent tariffs under President Donald Trump’s March 22 memorandum accusing the Chinese of unfair intellectual property practices (see 1803220043). CTA President Gary Shapiro called the administration wrong for having “singled out TVs as one of the largest proposed categories for a 25 percent tariff.” He urged "companies and consumers to take action, make their voices heard and tell the administration just how much damage this would do." Other industry players reacted negatively, and China plans to retaliate.

​U.S. Trade Representative Robert Lighthizer filed a “request for consultations” at the World Trade Organization to “address China’s discriminatory technology licensing requirements,” said his office Friday. President Donald Trump’s memorandum proposing 25 percent tariffs on about $60 billion worth of Chinese goods imported to the U.S. directed Lighthizer to address “China’s discriminatory technology licensing practices” through a WTO “dispute proceeding” (see 1803220043). The consultations request was the first step in that process, Lighthizer's office said.

The Office of the U.S. Trade Representative plans a hearing March 8 on its “Special 301” investigation of foreign countries that deny adequate and effective protection of intellectual property rights or deny fair market access to U.S. citizens who rely on IP protection, it said in Thursday's Federal Register. The hearing had tentatively been set for Tuesday. Post-hearing briefs are now due March 14, it said. USTR’s Special 301 report is still set for publication around April 30. Friday, USTR didn't have for us more details of the hearing at 1724 F St. NW, Rooms 1 and 2.

Alibaba's Taobao.com mobile commerce site, the Pacific Mall in Markham, Ontario, and online sites like Convert2mp3.net and ThePirateBay.org are among prominent physical and virtual marketplaces that facilitate or ignore rampant piracy and counterfeiting, the Office of the U.S. Trade Representative (USTR) said Friday in its annual notorious markets report. Citing growth of illicit streaming devices globally, USTR added several apps and portals that link such devices to illicit content -- TVPlus, TVBrowser and Kuaikan -- to the list. It said closer cooperation between governments and stakeholders is needed to tackle such video streaming piracy. Alibaba and mall management didn't comment.