USTR’s Proposed Tariff Modifications, Container Crunch and more on Forced Labor
USTR’s Proposed Tariff Modifications and Machinery Exclusions Chart New Course
The United States Trade Representative (USTR) has issued a Federal Register Notice proposing tariff modifications and a machinery exclusion process related to Section 301 actions against the People’s Republic of China (PRC). The USTR aims to address the PRC’s unfair trade practices, including technology transfer-related acts and cyber intrusions. The proposal includes increasing tariffs on specific products in strategic sectors and establishing a 30-day period for public comment on these modifications. Additionally, temporary exclusions for 19 tariff lines for solar manufacturing equipment are being proposed.
Highlights:
- USTR is proposing modifications to tariffs and a machinery exclusion process related to Section 301 actions against the PRC.
- The proposal aims to combat the PRC’s unfair trade practices, including technology transfer-related acts and cyber intrusions.
- It includes increasing tariffs on specific products in strategic sectors.
- A 30-day period has been established to allow the public to comment on these proposed modifications.
BMW’s Mini Cooper Imports Caught in Supply Chain Controversy
According to a Senate Finance Committee investigation, BMW Group shipped around 8,000 Mini Cooper cars to the U.S. that contained components from a banned supplier based in China’s Xinjiang region. Bourns Inc., a California-based auto supplier, sourced these parts, including LAN transformers, from Sichuan Jingweida Technology Group Co., which has been banned under the Uyghur Forced Labor Prevention Act for presumed forced labor practices. BMW continued to import cars using parts from this supplier until at least April, only ceasing after the committee questioned Lear Corp., a direct supplier for BMW and Jaguar Land Rover, about the issue. The report highlights concerns about automakers’ knowledge of and responsibility for forced labor in their supply chains.
Highlights:
- BMW Group shipped 8,000 Mini Cooper cars to the U.S. containing components from a banned supplier in China’s Xinjiang region.
- The supplier, Sichuan Jingweida Technology Group Co., has been banned under the Uyghur Forced Labor Prevention Act for presumed forced labor practices.
- BMW continued using parts from the banned supplier until April, only stopping after questioning from the Senate Finance Committee.
- The report raises concerns about automakers’ awareness of and accountability for forced labor in their supply chains.
How the Container Crunch is Rocking Global Trade
A sudden container shortage in the shipping industry has caused ocean freight rates to skyrocket, impacting global trade and supply chains. The shortage is linked to a surge in demand for goods as economies recover from the pandemic, combined with logistical challenges such as port congestion and delays in returning empty containers. As a result, shipping rates have surged, and businesses are facing increased costs and delays in receiving their shipments.
Highlights:
- The container shortage has led to a significant increase in ocean freight rates.
- The surge in demand for goods post-pandemic has exacerbated the container crunch.
- Logistical challenges like port congestion and difficulties in returning empty containers are contributing to the issue.
- Businesses are experiencing higher costs and delays in receiving their shipments due to the container shortage.
