Updated Section 301 Tariffs Include Temporary Relief for Certain Solar Equipment

Polysilicon. Adobe Stock

The Office of the United States Trade Representative (USTR) today announced final changes to the statutory review of tariff measures in the Section 301 investigation of laws, policies, and practices of the People’s Republic of China (PRC) related to technology transfer, intellectual property, and innovation.

The proposed changes announced in May 2024 were widely adopted, with several updates aimed at strengthening actions to protect American businesses and workers from unfair trade practices by China, after consideration of more than 1,100 public comments.

“The tariff increases finalized today will target the harmful policies and practices of the People’s Republic of China that continue to impact American workers and businesses,” said Ambassador Katherine Tai. “These actions underscore the Biden-Harris Administration’s commitment to defending American workers and businesses from unfair trade practices.”

The updates improve the effectiveness of the tariff measures in achieving the objectives of the investigation, while taking into account other measures that could be taken and the overall effects of the tariff measures on the U.S. economy.

These updates do not reflect any new consideration or change in the review’s findings that, while the PRC has modified some specific unfair measures, the PRC’s harmful practices of forced technology transfer—particularly cyber theft and industrial espionage—have continued and, in some cases, worsened. The findings of the quadrennial review can be found here.

Updates to today’s announcement include a new schedule and rates for tariffs on face masks, medical gloves, needles, and syringes; an exclusion for enteral syringes; a proposal to cover additional tariff lines for tungsten, wafers, and polysilicon; an exclusion for ship-to-shore cranes ordered before May 14, 2024; an expansion of the scope of the machinery exclusion process to include five additional tariff lines; and a change in the coverage of the proposed exclusions for solar manufacturing equipment.

Information about the revisions to the amendments is detailed in the USTR’s Federal Register notice, available here.

USTR plans to launch the machinery exclusion process and comment period shortly for proposed changes to duty rates on certain tariff lines for tungsten, wafers, and polysilicon.

The American solar energy manufacturers group SEMA welcomed these actions.

“This is an important step in aligning U.S. industrial policy and IRA goals with U.S. trade policy. Raising tariffs on Chinese solar component exports and temporarily relieving tariffs on certain solar equipment will boost U.S. manufacturing and send an important signal to China. The proposed and suggested tariff increases on solar components from China will, in the words of the USTR, defend the United States against China’s policy-driven non-market overcapacity, which has led to extreme concentration of production in China and undervalued exports,” Mike Carr, executive director of the SEMA coalition, said in a press release.

“The savings from retroactive equipment exclusions will help U.S. solar panel manufacturers address the challenges of China’s market manipulation,” he continued. “American companies were the first to build solar panel manufacturing plants in the United States and should be rewarded for taking that first step as we restore the entire supply chain.”