US launches second batch of tariffs on Chinese products amid “unfair trade practices” claims

17 September 2018


The US has stepped up its trade dispute with China by imposing a second batch of 25 per cent tariffs on around $16bn worth of Chinese imports.

The Office of the United States Trade Representative (USTR), says that the latest tariffs imposed on August 23, and collected by US Customs and Border Protection, respond to alleged unfair trade practices by China relating to the forced transfer of American technology and intellectual property. 

China responded to the initial US tariffs, which took effect on July 6, by accusing president Trump of starting a trade war, and introduced 25 per cent tariffs on US products including off-road vehicles, beef, whiskey and soya beans.

The Chinese tariffs are equivalent to the initial US $34bn tariff and the country also threatened to add a further $16bn targeting US medical equipment, crude oil and coal.

In July, Beijing reported a $28.1bn trade surplus with the US, lower than the $28.9bn record in June, but the figure was 11 per cent higher than in the same month in 2017.

The latest US tariffs contain 279 of the original 284 tariff lines on a proposed list published on June 15 which was changed after USTR and the interagency Section 301 Committee sought and received written comments and testimony during a two-day public hearing.

In March 2018, USTR released the findings of its exhaustive Section 301 investigation that found China’s acts, policies and practices related to technology transfer, intellectual property and innovation are “unreasonable and discriminatory and burden U.S. commerce.”

Specific findings of the investigation included allegations that:

  • China uses joint venture requirements, foreign investment restrictions, and administrative review and licensing processes to require, or pressure, technology transfers from U.S. companies.
  • China deprives U.S. companies of the ability to set market-based terms in licensing and other technology-related negotiations.
  • China directs, and “unfairly facilitates,” the systematic investment in, and acquisition of, U.S. companies and assets to generate large-scale technology transfer.
  • China conducts and supports cyber intrusions into U.S. commercial computer networks to gain unauthorised access to commercially-valuable business information.

As in the case of the first tranche of additional tariffs, a formal notice published in the Federal Register will explain how interest parties can request the exclusion of particular products covered by a tariff line facing the additional duties

Click here to view the final tariff list.


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