On Tuesday, May 29, it was announced that the administration would proceed with its Section 301 of the Trade Act of 1974 proposal to impose a 25% tariff on selected Chinese goods. This is approximately 10 days after declaring that the tariffs would be placed on hold. To clarify this rapidly changing situation regarding tariffs, below is an outline of important points and a timeline of pertinent events.
News / Supply Chain Alerts
The General Administration of Customs of the People’s Republic of China (GACC) has issued Announcement No.56 [2017] to adjust the manifest rules of import and export in the country, effective June 1, 2018. MIQ Logistics will adhere to the new requirements and transmit all required electronic data to China Customs prior to arrival or departure of air and sea shipments. To avoid delays, the following key points require your attention in your future shipping documentation:
- Manifest submissions must be made 24 hours prior to loading. This includes all import and export shipments moving by air or sea to / from / via China mainland ports.
- The manifest must accurately and completely reflect all goods under the bills of lading and waybills.
- The cargo description must be complete, accurate, and cover all the goods.
- Full contact details of the Shipper and Consignee (or the Notify Party if Consignee is “To Order”) are mandatory, including the Enterprise Codes. For example, for China — USCI (Unified Social Credit Identifier), OC (Organization Code); U.K. – Company Number, VAT (Value Added Tax) Identification Number; USA — CIK (Central Index Key), EIN (Employer Identification Number).
Starting Friday June 1, 2018, the 25% tariff on steel and 10% tariff on aluminum will go into effect for the European Union, Canada, and Mexico. The tariffs were originally announced in March (Steel and Aluminum Tariff List) but provided a temporary exemption to several U.S. allies while negotiations of export limits to the U.S. were discussed. According to U.S. Commerce Secretary Wilbur Ross, export limits were negotiated with South Korea, Argentina, Australia, and Brazil. However, Ross said negotiations didn’t go as far as he wanted them to with Canada, Mexico, and European diplomats and talks will continue.
New Tariffs Suspended While China Trade Negotiations Continue
During an appearance on Fox News Sunday on May 20, Treasury Secretary Steven Mnuchin said that around $150 billion worth of proposed tariffs on Chinese goods pursuant to Section 301 of the Trade Act of 1974 are on hold as the two countries continue trade negotiations to reduce their deficit.
“We’re putting the trade war on hold, so right now we have agreed to put the tariffs on hold while we try to execute the framework. … We have an agreement with China that they’re going to substantially agree to it.”
On May 8, 2018, the President announced his decision to cease the United States’ participation in the Joint Comprehensive Plan of Action (JCPOA), and to begin re-imposing the U.S. nuclear-related sanctions that were lifted to effectuate the JCPOA sanctions relief, following a wind-down period.
Departments and Agencies will begin the process of implementing 90-day and 180-day wind-down periods for activities involving Iran that were consistent with the U.S. sanctions relief specified in the JCPOA. At the end of the 90-day and 180-day wind-down periods, the applicable sanctions will come back into full effect.
On Friday, March 23, 2018, the President signed into law H.R. 1625 (Public Law 115-141), the “Consolidated Appropriations Act, 2018,” which in addition to providing full-year federal appropriations through September 30, 2018, extended GSP with retroactivity, for goods entered or withdrawn from a warehouse for consumption from January 1, 2018 through December 31, 2020. The new law, effective April 22, 2018, also provided for the retroactive refund of all duties (without interest) to the importer of record (IOR) on GSP-eligible goods entered during the January 1, 2018 through April 21, 2018 lapse period.
Canadian Pacific Railway Limited (CP) announced that a new labor agreement was reached with both the Teamsters Canada Rail Conference – Train & Engine (TCRC) and the International Brotherhood of Electrical Workers (IBEW), averting the potential work stoppage scheduled for 12:01am EDT April 21. CP’s embargoes for shipments routing to and from CP Canadian locations were canceled and CP immediately executed a safe and structured start-up of its train operations in Canada. The CP Customer Service Team is available to answer questions.
For more information, please contact your local MIQ Logistics representative.
The Shanghai Maritime Safety Administration has again implemented traffic control measures over the Yangtze River waterway from April 21 through April 23 due to restricted visibility of less than 500 meters. Shanghai arrivals and departures, and sailing schedules will be impacted for the next six days, resulting in a compounding effect on sailing schedules from main ports in China.
For more information, please contact your local MIQ Logistics representative.
Canadian Pacific Railway Limited (CP) announced that the Teamsters Canada Rail Conference – Train & Engine (TCRC) and the International Brotherhood of Electrical Workers (IBEW) have delivered a 72-hour notice of their respective plans to strike on April 21, 2018 at 12:01am EDT. The two unions represent over 3,300 engineers, conductors, signal and communication workers.
Dense fog has hampered vessel and port operations for Shanghai and Ningbo ports during the past three weeks, resulting in lengthy vessel delays, significant port congestion, outbound vessels unable to depart, and inbound vessels unable to dock. Operations have been further impacted by the implementation of Shanghai Maritime Safety Administration traffic control measures on the Yangtze River waterway. Average vessel delays of three to four days, up to a week, have been experienced.