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December 21, 2020

U.S. Commerce Department Issues New Rules For Section 232 Exclusion Process

While the World Trade Organization recently said that it will wait until late 2021 before issuing a ruling on whether the United States violated global trade rules with its Section 232 steel and aluminum tariffs, the U.S. Department of Commerce (DOC) last week released a rulemaking that alters its exclusion process for the penalties.

As a reminder, as Connecting the Dots reported previously, in May the DOC announced that it was seeking comments from the public regarding how to improve the exclusion process because it wanted “these critical national security measures to be applied effectively while avoiding unnecessary impacts on downstream American industries.”

According to an article in The National Law Review, the department’s interim rule makes three major changes to the process, including:

  • Implementing “General Approved Exclusions” (GAEs), which the DOC estimates will lead to an immediate decrease of approximately 5,000 exclusion requests annually;
  • Establishing new certification requirements for requestors with respect to the volume of product identified in their exclusion request; and
  • Providing clarifications on objector standards for delivery.

The latter portions of rule took effect on December 14, 2020, but the GAEs will become effective December 29, 2020.

The public can comment on the rule until February 12, 2021.

The National Law Review article noted the DOC did not address how to improve the exclusion process through technical changes, such as allowing interested parties to submit confidential information via the portal, and also did not address criticism “from some interested parties regarding what they view as the outsized influence of objections in the 232 exclusion process.” The DOC did say that some of the unaddressed criticisms could be tackled by future regulatory actions. (The department did not give a timeline for doing so, however.)

Click here to read The National Law Review article explaining these DOC’s changes in detail.