U.S. Trade Policy and Tariff Actions
- USTR announces Section 301 investigations into excess capacity and forced labor:
- Section 301 investigation on excess capacity and production: USTR has initiated Section 301 investigations into 16 trading partners (China, the European Union, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan, and India) alleging that structural excess manufacturing capacity in these countries displaces U.S. production and limits domestic investment. These investigations aim to fast-track potential tariff actions by July 2026, with public comments and hearings scheduled for April and May 2026. Several sectors are targeted in the investigation with possible excess capacity and production and include:
- Machinery
- Electronics
- Machine Tools
- Non-Ferrous Metals
- Plastics
- Robotics
- Semiconductors
- Steel
- Section 301 investigation into forced labor: USTR has initiated Section 301 investigations into 60 trading partners regarding the enforcement of bans on goods produced with forced labor which undermine goods produced in the United States. New tariffs anticipated July/August 2026. Written comments and hearing requests are due by 15 April, with public hearings scheduled for 28 April – 1 May.
- CBP to roll out refund tool for International Emergency Economic Powers Act (IEEPA) tariffs in phases: On 12 March, US CBP Executive Director Brandon Lord told the Court of International Trade that the agency will introduce its IEEPA tariff refund tool in stages and that the system could be ready in as early as 45 days, which would fall in late April; however, stakeholders within trade compliance are skeptical that the system will be fully operational by then. The first version is intended to process the majority of refund claims but will exclude more complex cases, such as entries involving antidumping or countervailing duties, along with other limited categories. CBP outlined the elements of the planned “Consolidated Administration and Processing Entries” (CAPE) system within the Automated Commercial Environment (ACE) with a phased deployment plan designed to let the platform take on increasingly complex filings as its capabilities expand. The four main components of the CAPE system are:
- Claim portal: A web portal where importers and brokers submit refund requests and where claims are validated (70% complete).
- Mass processing: Recalculates duties as if IEEPA tariffs had never been applied (40% complete).
- Review and either liquidation or reliquidation: Allows CBP to review entries, update duty totals, and calculate interest (60% complete).
- Refund processing: Sends consolidated electronic refunds through CBP’s system to the importer or designated recipient.
- Status of U.S. bilaterial negotiations and discussions: During the period when IEEPA tariffs were in effect, the Trump Administration negotiated or announced trade agreements with eighteen countries. Countries with announced US reciprocal framework trade deals of relevance to PMMI members include the EU, Switzerland, Japan, UK, Taiwan, South Korea, and India. Given the Supreme Court decision that IEEPA tariffs are deemed illegal, the IEEPA-related provisions of agreements are nullified. As of 24 February, all US trading partners are subject to the Section 122 10% tariff (increase to 15% expected given earlier comments by President Trump and Secretary Bessent) regardless of whether a deal was negotiated. The Administration has noted that they intend to stand by the trade deals and expect counterparts to as well. Country reactions to date include:
- European Union: The EU Parliament’s trade committee agreed to extend the pause on the implementation of the US-EU framework agreement as they await more information from the United States.
- Switzerland: Switzerland’s Economic Minister Guy Parmelin said that Switzerland is sticking to its existing trade negotiations with the United States.
- United Kingdom: Britian’s Trade Minister Peter Kyle said he was confident the trade deal between the US and Britain would still stand despite the 10% Section 122 tariff.
- South Korea: Trade representatives from the US and South Korea are expected to meet this week in Washington, DC to discuss potential investments under the fund established as part of the US-South Korea trade framework. The meeting comes as South Korea’s parliament enacted a special bill enabling the country’s $350 B investment in the US.
- India: India’s Commerce Ministry denied a news report that India planned to delay the signing of the US trade deal and said that the two countries remain engaged in negotiations.
- Canada and Mexico officials stressed importance of maintaining USMCA: On 12 March, Canada’s Ambassador to Mexico Cameron MacKay and Mexican Deputy Trade Secretary Luis Rosendo Gutierrez spoke at a conference in Mexico City where they reaffirmed the importance of maintaining the United States Mexico Canada Agreement (USMCA). Their comments follow USTR’s announcement of two new Section 301 investigations into alleged forced labor and excess capacity. Mexico was listed in both investigations while Canada was listed in the investigation into forced labor. Both Mexico and Canada are top importing markets for food processing and packaging machinery with U.S. imports totaling $80.6 M and $744.2 M, respectively (based on the last 12 months of available data December 2024 – November 2025). U.S. exports for the same period totaled $471.2 M to Canada and $282.3 M to Mexico.
