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May 4, 2020

Should Trump Administration Consider Changes To Section 232 Exclusion Process?

As Politico reported last week, the Aluminum Association wrote to the U.S. Department of Commerce asking for “significant reforms” to its Section 232 exclusion process. The letter, available here, pointed to the large volume of tariff exclusions for aluminum flat-rolled products.

Specifically, it asks that the Commerce Department:

  • Review all Section 232 exclusion requests involving aluminum products to ensure that volumes identified in each request are proportional to historical U.S. import volumes, compared to aggregate annual volumes for an individual applicant and its parent company as well as product category, and proportional to U.S. market demand. It also says the department should apply heightened scrutiny to requests that exceed a requestor’s historical volume of imports.
  • Restrict eligibility for exclusion requests from importers who are not manufacturers, so that only importers who are in some way transforming the aluminum are eligible for an exclusion. If the Commerce Department opts not to restrict eligibility, it should at the very least shift the burden of proof to require nonaluminum producing requestors to demonstrate why they need to import aluminum products (in individual applications and in aggregate) above historical import volumes.
  • Limit exclusions only to those products outside of the capability of domestic producers or for which there is no U.S. production.

The Metals Service Center Institute is reviewing how these proposals would impacts its members. As a reminder, MSCI’s stance on the Trump administration’s Section 232 penalties can be found here.