We have been monitoring for a news update on whether U.S. & CHINA reached a “PHASE ONE DEAL” since we last wrote about it on October 11, 2019. Two months later, the USTR published a press release confirming that the United States and China have reached an historic and enforceable agreement on a Phase One trade deal and President Trump tweeted the announcement noting that this “is an amazing deal for all”.
What does the “Phase One Deal” Include?
- The deal requires structural reforms and other changes to China’s economic and trade regime in the areas of intellectual property, technology transfer, agriculture, financial services, and currency and foreign exchange.
- The Phase One agreement also includes a commitment by China that it will make substantial additional purchases of U.S. goods and services in the coming years.
- Importantly, the agreement establishes a strong dispute resolution system that ensures prompt and effective implementation and enforcement.
- The United States has agreed to modify its Section 301 tariff actions in a significant way.
What is the Impact on Section 301 Tariffs?
- Lists 1, 2, 3 will continue to be subject to 25% tariffs
- Approximately $250 billion of Chinese imports
- List 4A has been reduced to 7.5% from 15%
- Approximately $120 billion of Chinese imports
- The effective date for the reduced tariff has NOT been announced.
- List 4B will not become effective on December 15.
Helpful Chart on Navigating Section 301 Tariffs:
For background information on China Tariffs and numerous ways to mitigate the effect of the China tariffs, check out our previous blogs. Diaz Trade Law has assisted clients in assessing their best options to prepare or mitigate the China tariffs and submitted comments and exclusions. Our Customs and International Law attorneys are available at 305-456-3830 or firstname.lastname@example.org.