MEMA’s Concerns about Section 232 Tariffs on Steel and Aluminum Heard: Product Exclusions now Available for Countries with Quotas, Retroactive Relief Changed to Date of Filing

Date: August 30, 2018

In a win for motor vehicle parts suppliers, President Trump has signed proclamations allowing the Commerce Department to provide targeted relief from quotas imposed under Section 232 on steel from South Korea, Argentina, and Brazil, and aluminum from Argentina. 

The proclamations allow companies to apply for product exclusions based on insufficient quantity or quality available from U.S. steel or aluminum producers, like is allowed for the tariffs. In addition, the proclamations extend retroactive relief for all granted product exclusion requests back to the date of filing (it was previously the date of posting on regulations.gov).

The proclamations are a sign that efforts on Capitol Hill by the Motor and & Equipment Manufacturers Association on behalf of its members are working. Relief from quotas and clarity on the product exclusion process has been a priority for MEMA in recent weeks. In an August 7  letter from MEMA to the leaders of the Trade Subcommittee of the House Committee on Ways and Means, MEMA outlined an onerous, expensive, and confusing process for steel and aluminum tariff exclusions. The letter went on to explain that the process is “opaque, inconsistent, and inaccessible” and that U.S. companies “have described the experience as arbitrary and capricious, lacking substantial evidence for the denial determinations.”

The letter, which was submitted August 7 for the record on the Subcommittee’s hearing on “Product Exclusions Process for Section 232 Tariffs on Steel and Aluminum,” provides multiple remedies for an exclusion process that has proven ineffective.

MEMA welcomes the changes made in the President’s proclamations and is encouraged by the response from the Trump administration in reaction to complaints from the business community. While there is still a need for improvement, these are good first steps in fixing a problematic process.

In written and oral testimony before the Trump administration, MEMA has warned that tariffs that prevent or encumber motor vehicle parts suppliers’ ability to obtain certain types of steel and aluminum could jeopardize production of critical products made for the U.S. defense industry and could destabilize a growing U.S. manufacturing job base. MEMA continues to reiterate its warning that steep, across-the-board tariffs on aluminum and steel coming into the United States is dangerous and could put the very jobs and competitiveness the administration hopes to help in harm’s way. 

The Department of Commerce Press Release can be found here, the steel proclamation here, and the aluminum proclamation here.

For more information, please visit MEMA’s Trade Resources Page.

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