Greenspoon Marder Client Alert: Opportunity to Be Exempt from New Tariffs if You Are Exporting to China: China Announces Tariff List Exclusion Process Open Until July 5

Jun 10, 2019

By Jessica Wasserman, Esq.

Due to the imposition of several rounds of tariff escalations over the past months by the US against China, there are now tariffs being imposed by China on US exports in retaliation. The tariffs now imposed on US exports to China total to about $60 billion of US goods.

China recently announced an exclusion process whereby US products may be removed from the list for tariff imposition, allowing for avoidance of the increased duties. Those seeking said exclusion must file a request with China’s MOF before July 5, 2019.

The tariffs in place on US exports to China are as follows (please contact us if you would like a full list of products and HTS codes):

25% tariffs on 2,493 items, up from 10% previously. These include some mechanical parts, natural gas and skincare products.
20% tariffs on 1,078 items, up from 10% previously. These include some machinery, wood and optical instruments.
10% tariffs on 974 items, up from 5% previously. These include sheet glass, lasers and control valves.
5% tariffs continue on 595 items. Auto parts, which were initially on the list but have been exempted since January, are still excluded.

The Exclusion Request Process

On May 13, 2019, China’s State Council Customs Tariff Commission (SCCTC) announced that China will administer an exclusion process for additional Chinese tariffs imposed on specific products imported from the US. Both enterprises and industry associations that import, produce, or use relevant products are eligible to apply through the new process for tariff exclusions.

Applicants seeking tariff exclusion must submit documentation and commercial data describing how additional ad valorem tariffs on Chinese imports of US goods (1) face challenges seeking alternative sources of goods; (2) cause serious economic damage to the applicant; and (3) cause major negative structural impacts on the relevant industries or lead to serious social consequences. China’s Ministry of Finance (MOF) will accept exclusion applications for the published list of products from June 3, 2019, through July 5, 2019.

China’s MOF has published a procedure for requesting tariff exclusion and a first list of applicable products. While the MOF is managing the online platform, the SCCTC will oversee the decision-making process. Both enterprises and industry associations that import, produce, or use the listed products are eligible to apply.

Enterprises and industry associations within mainland China may register, upload, and file application through MOF’s Tariff Policy Research Center’s website.

MOF will publish an additional list of products eligible for tariff exclusion at a later date. The application window for this additional list is expected to be from September 2, 2019, through October 18, 2019.
Applicants must submit copies of their official business license, their Uniform Social Credit Code, and an active Chinese mobile number, among other personally identifiable information.

Applicants must submit the following information in the online application:

Basic Product Information (1) Identifiable products that applied for exclusion; (2) Tariff code – as defined by the HS 8-digit or 10-digit code, or product description; (3) Use of the products.
Detailed Import Data for each HS Code for each product from the United States and from third countries for the last three years (2017 to 2019), as well as the Customs declaration forms for the top five largest imports for those years.

An expert review panel, appointed by the SCCTC, will consider the merits of each application. The committee will be composed of industry and technical experts and government officials. The panel will seek to identify the specific harm that the tariffs have on the overall economic structure or societal context of the Chinese industry, producers, or consumers. After the expert panel review is complete, eligible products for exclusion will be published on the MOF website.

MOF has announced a dedicated hotline for the exclusion process. Beginning on June 3, 2019, applicants can call if they encounter problems in filing and uploading the application information. The line is open Monday through Friday, 9:00 AM – 11:30 AM China Standard Time and 2:00 PM – 5:00 PM China Standard Time. The hotline will likely only be operated by Mandarin speakers.

Direct your inquiries to the following: Technical Consultation Line: +86 (10) 8221 7953 or Business Consultation Lines: +86 (10) 8221 7308; +86 (10) 8221 7315; +86 (10) 8221 7320.

Please contact Greenspoon Marder Partner, Jessica Wasserman, in our Washington, D.C. office at [email protected] or 202-669-9449.

About Greenspoon Marder

Greenspoon Marder LLP is a full-service law firm with over 240 attorneys and more than 20 office locations across the United States. With operations from Miami to New York and from Denver to Los Angeles, our firm attracts some of the nation’s top talent in key markets and innovation hubs. Our core practice areas include Real Estate, Litigation, and Transactional Services, complemented by the capabilities of a full-service firm. Greenspoon Marder has upheld a spot on The American Lawyer’s Am Law 200 as one of the top law firms in the U.S. since 2015, and our goal is to provide exceptional client service by developing a thorough understanding of each client’s business needs and objectives in order to provide strategic, cost-effective solutions.

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This Greenspoon Marder LLP Client Alert is issued for informational purposes only and is not intended to be construed or used as general legal advice nor a solicitation of any type. Please contact the author(s) or your Greenspoon Marder LLP contact if you have any questions regarding the currency of this information. The hiring of a lawyer is an important decision. Before you decide, ask for written information about the lawyer’s legal qualifications and experience.

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Greenspoon Marder Client Alert: Opportunity to Be Exempt from New Tariffs if You Are Exporting to China: China Announces Tariff List Exclusion Process Open Until July 5

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