The White House, on January 23, 2018, posted two Presidential Proclamations regarding the Section 201 “safeguard” investigations on certain crystalline silicon photovoltaic cells (solar cells or CSPVs) and large residential washers (LRWs). These proclamations contain additional details that were not provided in the U.S. Trade Representative (USTR) press release and fact sheet released on January 22, 2018. The effective date of the import restrictions for both Section 201 actions is February 7, 2018.
Certain Crystalline Silicon Photovoltaic Cells
Scope: (a) solar cells, whether or not assembled into modules or made up into panels provided for in HTSUS subheading 8541.40.60; (b) parts or subassemblies of solar cells provided for in HTSUS subheadings 8501.31.80, 8501.61.00, and 8507.20.80; (c) inverters or batteries with CSPV cells attached provided for in HTSUS subheadings 8501.61.00 and 8507.20.80; and (d) DC generators with CSPV cells attached provided for in HTSUS subheading 8501.31.80. Excluded from the order are thin film photovoltaic products produced from amorphous silicon, cadmium telluride, or copper indium gallium selenide, as well as CPSV cells that do not exceed 100 square centimeters in surface area (the foregoing surface area limit applying to a single cell or group of cells) and which are permanently integrated into a consumer good which consumes the energy produced by the cell.
Remedy: President Trump applied a tariff-rate quota (TRQ) on imports of solar cells not partially or fully assembled into other products. The in-quota quantity each year under the TRQ will be allocated among all countries, except those that are exempted from import restrictions; however, the annex to the proclamation does not specify exactly how the quota will be allocated among countries included in the order. The tariff rate is 30 percent for the first year, and will decrease by five percent annually in the subsequent three years. The first 2.5 gigawatts of cells imported after the effective date of the new duties are excluded from this tariff rate. For modules, President Trump applied a simple tariff of 30 percent the first year, decreasing by five percent annually in the subsequent three years.
Country Exclusions: In the solar cells investigation, the remedy includes restrictions on both Canada and Mexico, although the U.S. International Trade Commission (ITC) recommended an exclusion only for solar cell imports originating from Canada. The remedy excludes GSP beneficiary countries from import restrictions, but only those that account for less than 3 percent of total exports. Imports from Thailand and the Philippines accounted for more than 3 percent, therefore those countries are included in the import restrictions.
Large Residential Washers
Scope: (a) washers provided for in HTSUS subheadings 8450.11.00 and 8450.20.00; (b) all cabinets, or portions thereof, designed for use in washers, and all assembled baskets designed for use in washers that incorporate, at a minimum, a side wrapper, a base, and a drive hub, provided for in HTSUS subheading 8450.90.60; (c) all assembled tubs designed for use in washers that incorporate, at a minimum, a tub and a seal, provided for in HTSUS subheading 8450.90.20; and (d) any combination of the foregoing parts or subassemblies, provided for in HTSUS subheadings 8450.90.20 or 8450.90.60. Excluded from the order are all stacked washer-dryers and all pay-per-use commercial washers, as well as automatic washers which (A) have a vertical rotational axis, are top loading, and have a drive train consisting of a permanent split capacitor motor, a belt drive and a flat wrap spring clutch; (B) have a horizontal rotational axis, are front loading, and have a drive train consisting of a controlled induction motor and belt drive; or (C) have a horizontal rotation axis, are front-loading, and have a cabinet width of more than 72.39 cm.
Remedy: President Trump applied a TRQ for three years to subject LRW imports. In the first year, a 20 percent tariff will apply to the first 1.2 million units of imported finished washers, and a 50 percent tariff will apply to all subsequent imports of finished washers and all imports of covered parts after the first 50,000 units. The tariff on the first 1.2 million units of imported finished washers will decrease by 2 percent per year for the following two years, while the tariff for subsequent imports of finished washers and imports of covered parts will decrease by 5 percent annually and the exclusion for covered parts will increase by 20,000 units annually during the same period. The in-quota quantity each year will be allocated among all countries except those that are exempted from import restrictions. However, the annex to the proclamation does not specify exactly how the quota will be allocated among countries included in the order.
Country Exclusions: Although the USITC recommended exemptions for imports from Mexico and Canada, this remedy includes restrictions on imports from Mexico but exempts imports from Canada. The remedy also includes restrictions on Korea. The remedy excludes GSP beneficiary countries from import restrictions, but only those that account for less than 3 percent of total exports. Imports from Thailand accounted for more than 3 percent, therefore Thailand is included in the import restrictions.
While the solar cell duties target both Mexico and Canada, imports from Asian countries will likely be the most affected. Korea represents 21 percent of U.S. solar cell imports, while Malaysia accounts for 36 percent of solar cell imports. Vietnam, Thailand and China account for 9 percent, 9 percent and 8 percent, respectively. Based on the scope and exclusions, the solar cell duties will impact home and commercial solar installations and solar-enabled power generators, inverters and batteries, but will exclude certain solar-enabled consumer goods, such as nightlights and dimmers. However, certain travel bags with solar cells exceeding 100 square centimeters could potentially be covered by the duties. Larger panels measuring between 1,000 and 3,061 square centimeters that contain internal batteries or external computer peripheral ports at the time of entry will also be subject to the remedies.
Certain scope exclusions for large residential washers mean that certain units will face duties, while other slightly larger front-loading units may be exempt. For example, many top-loading and front-loading washers measuring 27 inches or less in width will be covered by the duties, while some front-loading units measuring 29 inches or more may be exempt.