As previously reported, the president issued on March 8, 2018, proclamations imposing a 25 percent duty on steel and a 10 percent duty on aluminum imported into the United States from all countries, excluding Canada and Mexico. On March 19, the Department of Commerce (Commerce) issued an Interim Final Rule (IFR) for requesting and objecting to exclusions.
The forms Exclusion requests and objections must be filed electronically through www.regulations.gov. The process is being managed by the Bureau of Industry and Security (BIS). The steel and aluminum forms that are required for the application can be accessed online, as applicable. Additional information can be submitted with the application. There is a 25-page limit for requests and objections.
Naming conventions and other general requirements
The IFR outlines specific naming conventions for attachments. For exclusion requests, the file name must include:
- Submitter’s name
- Date of submission
- 10 digit HTSUS
For example, “Company A exclusion request of 6-1-18 for 7207200045 HTSUS.pdf.”
For objections to submitted exclusion requests, the file name must include:
- Objector’s name
- Date of objection
- Name of requestor
- Date of exclusion request
For example, “Company B objection 6-30-18 to exclusion request submitted on 6-1-18 by CompanyA.pdf.”
A separate request must be submitted for each item based on the following:
- Chemical breakdown by weight
- Metallurgical properties
- Surface quality
- Distinct dimension
- HTSUS
The chemical breakdown, metallurgical properties, and surface quality are not applicable to aluminum exclusion requests.
Requesters must be individuals or organizations using steel or aluminum articles identified in the Proclamations in business activities, e.g., construction, manufacturing, or supplying the product to users, in the United States.
Requests and objections are public filings and must not include any controlled information, including controlled technology and controlled technical data. We suggest that filers take great care with respect to the inclusion of any proprietary information in the request. While the IFR provides that documents should be clearly marked to indicate they contain proprietary information, it does not outline procedures for how this information will be treated.
Exclusion requests
Exclusion requests should specify the business activity in the U.S. as well as identify and provide support for the basis of the request. Exclusions are only granted for:
- Items not produced in the U.S. in sufficient and reasonably available amounts
- Items not produced in the U.S. at a satisfactory level of quality
- Specific national security considerations
Objections to exclusion requests
Objections should identify and provide support for opposition and “reference the specific basis identified in, and the support provided for, the submitted exclusion request.” Objections must be filed within 30 days of the exclusion request.
Exclusion determinations
Exclusion determinations will normally be issued within 90 days and will take into consideration the exclusion request along with any submitted objections. Exclusions are granted specifically to the requester. Others cannot directly use the exclusion; they must file their own request. As such, requesters may submit exclusion requests for products that have been previously denied exclusion and those for which an exclusion has expired.
Exclusions, which are normally reviewed within 90 days, are effective five business days after publication of approval and will generally be approved for one year.
Open issues
Based on our review, there are several open issues that need to be addressed. Commerce will consider national security as it relates to the source of the product, which suggests that a product may be excluded from one country but not another. Commerce is seeking comments regarding “how and whether or not the country of origin of a proposed product should be considered by Commerce as part of the process for reviewing product-based exclusion requests.”
Importations prior to the publication of the exclusion will be dutiable. The IFR provides no guidance with respect to retroactive effect of the exclusion or the recovery of these duties. Therefore, one may need to consider placing imported goods into a bonded warehouse or a foreign trade zone, or examine the use of drawback to recover duties previously paid.
It is unclear how exclusions will be reported to Customs and Border Protection. Perhaps an exclusion number will be assigned to the requester, but that remains to be seen.
The IFR does not address country-based exclusions, which begs the question: Can an importer, other than the requester, use the exclusion as long as the product is for the requester?
Comments on the IFR must be received by BIS no later than May 18, 2018. The Thompson Coburn International Trade attorneys are available to assist you in drafting your comments and to answer any questions you may have.