On February 14, 2020, the Office of the US Trade Representative (USTR) announced that USTR was issuing a notice in the Federal Register making adjustments to its WTO-authorized retaliation action relating to the Large Civil Aircraft case, which was implemented on October 18, 2019. The announcement stated that the United States is increasing the additional duty rate imposed on aircraft imported from the EU to 15% from 10%, effective March 18, 2020, and making certain other minor modifications.
On December 12, 2019, USTR announced a review of the Section 301 action and requested public comments (see 84 Fed. Reg. 67992, December 12, 2019). The notice [Docket No. USTR-2019-0003], to be published in the Federal Register states that based on this review, the USTR has determined increase the duties on certain large civil aircraft from 10 to percent to 15 percent, and to change the composition of the list of products subject to additional duties of 25 percent. As of this time, USTR has decided not to increase the rate of additional duties above the additional 25 percent currently being applied to non-aircraft products. The USTR has also determined that going forward, the action may be revised as appropriate immediately upon any EU imposition of additional duties on U.S. products in connection with the Large Civil Aircraft dispute or with the EU’s WTO challenge to the alleged subsidization of U.S. large civil aircraft.
The modifications to the Section 301 action set out in Annex 1, subparagraph C, are applicable with respect to products that are entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. EST on March 18, 2020. The modifications set out in Annex 1, subparagraphs A and B, are applicable with respect to products that are entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. EST on March 5, 2020.
In order to implement this determination, effective March 18, 2020, subchapter III of chapter 99 of the HTSUS is modified by subparagraph C of Annex 1 to the notice. Effective March 5, 2020, subchapter III of chapter 99 of the HTSUS is modified by subparagraphs A and B of Annex 1 to the notice. The additional duties provided for in the HTSUS subheadings established by Annex 1 apply in addition to all other applicable duties, fees, exactions, and charges.
Any product listed in Annex 1, subparagraph C, to the notice, except any product that is eligible for admission under ‘domestic status’ as defined in 19 C.F.R. 146.43, which is subject to the additional duty imposed by this determination, and is admitted into a U.S. foreign trade zone on or after 12:01 a.m. eastern daylight time on March 18, 2020 (or March 5 for product listed in Annex 1, subparagraphs A and B), only may be admitted as ‘privileged foreign status’ as defined in 19 C.F.R. 146.41. Such products will be subject upon entry for consumption to any ad valorem rates of duty or quantitative limitations related to the classification under the applicable HTSUS subheading. The notice states that the United States remains open to a negotiated settlement that addresses current and future subsidies to Airbus provided by the EU and certain current and former member States.