Notice of Product Exclusions: China's Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation, 37381-37384 [2019-16256]

Agencies

• Office of the United States Trade Representative

[Federal Register Volume 84, Number 147 (Wednesday, July 31, 2019)]
[Notices]
[Pages 37381-37384]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-16256]


=======================================================================
-----------------------------------------------------------------------

OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE


Notice of Product Exclusions: China's Acts, Policies, and 
Practices Related to Technology Transfer, Intellectual Property, and 
Innovation

AGENCY: Office of the United States Trade Representative.

ACTION: Notice of product exclusions.

-----------------------------------------------------------------------

SUMMARY: Effective August 23, 2018, the U.S. Trade Representative 
(Trade Representative) imposed additional duties on goods of China with 
an annual trade value of approximately $16 billion (the $16 billion 
action) as part of the action in the Section 301 investigation of 
China's acts, policies, and practices related to technology transfer, 
intellectual property, and innovation. The Trade Representative's 
determination included a decision to establish a product exclusion 
process. The Trade Representative initiated the exclusion process in 
September 2018, and stakeholders have submitted requests for the 
exclusion of specific products. This notice announces the Trade 
Representative's determination to grant certain exclusion requests, as 
specified in the Annex to this notice. The Trade Representative will 
continue to issue decisions on pending requests on a periodic basis.

DATES: The product exclusions announced in this notice will apply as of 
the August 23, 2018 effective date of the $16 billion action, and will 
extend for one year after the publication of this notice. U.S. Customs 
and Border Protection will issue instructions on entry guidance and 
implementation.

FOR FURTHER INFORMATION CONTACT: For general questions about this 
notice, contact Assistant General Counsels Philip Butler or Megan 
Grimball, or Director of Industrial Goods Justin Hoffmann at (202) 395-
5725. For specific questions on customs classification or 
implementation of the product exclusions identified in the Annex to 
this notice, contact [email protected].

SUPPLEMENTARY INFORMATION: 

A. Background

    For background on the proceedings in this investigation, please see 
the prior notices issued in the investigation, including 82 FR 40213 
(August 23, 2017), 83 FR 14906 (April 6, 2018), 83 FR 28710 (June 20, 
2018), 83 FR 33608 (July 17, 2018), 83 FR 38760 (August 7, 2018), 83 FR 
40823 (August 16, 2018), 83 FR 47236 (September 18, 2018), 83 FR 47974 
(September 21, 2018), 83 FR 65198 (December 19, 2018), 84 FR 7966 
(March 5, 2019), 84 FR 20459 (May 9, 2019), and 84 FR 29576 (June 24, 
2019).
    Effective August 23, 2018, the Trade Representative imposed 
additional 25 percent duties on goods of China classified in 279 8-
digit subheadings of the Harmonized Tariff Schedule of the United 
States (HTSUS), with an approximate annual trade value of $16 billion. 
See 83 FR 40823. The Trade Representative's determination included a 
decision to establish a process by which U.S. stakeholders may request 
exclusion of particular products classified within an 8-digit HTSUS 
subheading covered by the $16 billion action from the additional 
duties. The Trade Representative issued a notice setting out the 
process for the product exclusions, and opened a public docket. See 83 
FR 47236 (the September 18 notice).
    Under the September 18 notice, requests for exclusion had to 
identify the product subject to the request in terms of the physical 
characteristics that distinguish the product from other products within 
the relevant 8-digit subheading covered by the $16 billion action. 
Requestors also had to provide the 10-digit subheading of the HTSUS 
most applicable to the particular product requested for exclusion, and 
could submit information on the ability of U.S. Customs and Border 
Protection to administer the requested exclusion. Requestors were asked 
to provide the quantity and value of the Chinese-origin product that 
the requestor purchased in the last three years. With regard to the 
rationale for the requested exclusion, requests had to address the 
following factors:
     Whether the particular product is available only from 
China and specifically whether the particular product and/or a 
comparable product is available from sources in the United States and/
or third countries.
     Whether the imposition of additional duties on the 
particular product would cause severe economic harm to the requestor or 
other U.S. interests.
     Whether the particular product is strategically important 
or related to ``Made in China 2025'' or other Chinese industrial 
programs.
    The September 18 notice stated that the Trade Representative would 
take into account whether an exclusion would undermine the objective of 
the Section 301 investigation.
    The September 18 notice required submission of requests for 
exclusion from the $16 billion action no later than December 18, 2018, 
and noted that the Trade Representative would periodically announce 
decisions. The Office of the United States Trade Representative 
regularly updates the status of each pending request and posts the 
status within the web pages for the respective tariff action they apply 
to at https://ustr.gov/issue-areas/enforcement/section-301-investigations/tariff-actions.

B. Determination To Grant Certain Exclusions

    Based on the evaluation of the factors set out in the September 18 
notice, which are summarized above, pursuant to sections 301(b), 
301(c), and 307(a) of the Trade Act of 1974, as amended, and in 
accordance with the advice of the interagency Section 301 Committee, 
the Trade Representative has determined to grant the product exclusions 
set out in the Annex to this notice. The Trade Representative's 
determination also takes into account advice from advisory committees 
and any public comments on the pertinent exclusion requests.
    As set out in the Annex to this notice, the exclusions are 
reflected in 69 specially prepared product descriptions, which cover 
292 separate exclusion requests.
    In accordance with the September 18 notice, the exclusions are 
available for any product that meets the description in the Annex, 
regardless of whether the importer filed an exclusion request. Further, 
the scope of each exclusion is governed by the scope of the product 
descriptions in the Annex to this notice, and not by the product 
descriptions set out in any particular request for exclusion.
    Paragraph A, subparagraphs (3)-(4) are conforming amendments to the 
HTSUS reflecting the modification made by the Annex to this notice.
    As stated in the September 18 notice, the exclusions will apply as 
of the August 23, 2018 effective date of the $16 billion action, and 
extend for one year after the publication of this notice. U.S. Customs 
and Border Protection will issue instructions on entry guidance and 
implementation.

[[Page 37382]]

    The Trade Representative will continue to issue determinations on 
pending requests on a periodic basis.

Joseph Barloon,
General Counsel, Office of the U.S. Trade Representative.

Annex

    A. Effective with respect to goods entered for consumption, or 
withdrawn from warehouse for consumption, on or after 12:01 a.m. 
eastern daylight time on August 23, 2018, subchapter III of chapter 99 
of the Harmonized Tariff Schedule of the United States (HTSUS) is 
modified:
    1. By inserting the following new heading 9903.88.12 in numerical 
sequence, with the material in the new heading inserted in the columns 
of the HTSUS labeled ``Heading/Subheading'', ``Article Description'', 
and ``Rates of Duty 1-General'', respectively:

----------------------------------------------------------------------------------------------------------------
                                                                              Rates of duty
                                                       ---------------------------------------------------------
    Heading/ subheading         Article description                          1
                                                       ---------------------------------------------      2
                                                               General                Special
----------------------------------------------------------------------------------------------------------------
``9903.88.12..............  Articles the product of     The duty provided in   ....................  ...........
                             China, as provided for in   the applicable
                             U.S. note 20(o) to this     subheading''.
                             subchapter, each covered
                             by an exclusion granted
                             by the U.S. Trade
                             Representative.
----------------------------------------------------------------------------------------------------------------

    2. by inserting the following new U.S. note 20(o) to subchapter III 
of chapter 99 in numerical sequence:
    ``(o) The U.S. Trade Representative determined to establish a 
process by which particular products classified in heading 9903.88.02 
and provided for in U.S. notes 20(c) and (d) to this subchapter could 
be excluded from the additional duties imposed by heading 9903.88.02. 
See 83 FR 40823 (August 16, 2018) and 83 FR 47236 (September 18, 2018). 
Pursuant to the product exclusion process, the U.S. Trade 
Representative has determined that the additional duties provided for 
in heading 9903.88.02 shall not apply to the following particular 
products, which are provided for in the enumerated statistical 
reporting numbers:

(1) Chlorinated polyethylene elastomer, in white or pale yellow powder 
form, containing 28 to 44 percent by weight of chlorine (described in 
statistical reporting number 3901.90.1000)
(2) Polytetrafluoroethylene ((C2F4)n), having a particle size of 5 to 
500 microns and a melting point of 315 to 329 degrees Celsius 
(described in statistical reporting number 3904.61.0090)
(3) Expandable plastics beads, 0.30 to 0.50 mm in diameter, consisting 
of copolymers of methylmethacrylate (62 to 64 percent by weight) and 
styrene (26 to 28 percent by weight) (described in statistical 
reporting number 3906.90.2000)
(4) Polyol blends containing 92 percent or more by weight of polyether 
polyol (CAS number 9049-71-2) and 2.5% or more by weight of N,N-
dimethylcyclohexamine (described in statistical reporting number 
3907.20.0000)
(5) Hot melt flat shapes of biaxiallyoriented polypropylene (BOPP) film 
with an acrylic emulsion (described in statistical reporting number 
3919.90.5060)
(6) Polyethylene film, 20.32 to 198.12 cm in width, and 30.5 to 2000.5 
m in length, coated on one side with solvent acrylic adhesive, clear or 
in transparent colors, whether or not printed, in rolls (described in 
statistical reporting number 3919.90.5060)
(7) Polyvinyl chloride film, coated on one side with pressure sensitive 
solvent-acrylic adhesive that allows for easy removal from a flat glass 
or flat, rigid, clear plastics surface, 106.7 cm, 137.2 cm or 152.4 cm 
in width, and 30.38 m or 49.99 m in length, with regular perforations 
measuring 1.5 to 1.6 mm in diameter, where the perforations cover 30, 
40 or 50 percent of the surface area (described in statistical 
reporting number 3919.90.5060)
(8) Printed rectangular polyethylene sheets depicting images on one 
side, with self-adhesive edges protected with peel-off liners on the 
other side, measuring 30.5 cm by 45.7 cm or 30.5 cm by 25.4 cm 
(described in statistical reporting number 3919.90.5060)
(9) Self-adhesive colored or printed polyvinyl chloride film with a 
peelable liner, in rolls, measuring 30.5 cm or 50.8 cm in width and 
3.05 m to 6.10 m in length, of a kind used for lining shelves or 
drawers (described in statistical reporting number 3919.90.5060)
(10) Printed, nonpermeable plastic film of ethylene designed for use in 
packaging personal care products such as baby wipes, adult wipes and 
similar wet stack products (provided for in statistical reporting 
number 3920.10.0000)
(11) Polyethylene film of a kind used for wrapping perishable foods, in 
rolls measuring 30.5 cm in width and up to 76.2 m in length, with a 
starter edge tab, put up in retail packages incorporating a built-in 
slide cutter and grip strip for holding the film in place until 
subsequent use (described in statistical reporting number 3920.10.0000)
(12) Rectangular sheets of high-density or low-density polyethylene, 
111.75 cm to 215.9 cm in width, and 152.4 cm to 304.8 cm in length, 
with a sticker attached to mark the center of each sheet, of a kind 
used in hospital or surgery center operating rooms (described in 
statistical reporting number 3920.10.0000)
(13) Spark-ignition rotary or reciprocating internal combustion piston 
engines to be installed in agricultural or horticultural machinery or 
equipment, 4,476 W or more but not more than 37.6 kW, each valued not 
over $180 (described in statistical reporting number 8407.90.1020)
(14) Gasoline or liquid propane (LP) engines each having a displacement 
of more than 2 liters but not more than 2.5 liters (described in 
statistical reporting number 8407.90.9010)
(15) Spark-ignition internal combustion piston engines, not elsewhere 
specified or included, 746 W or greater but not exceeding 4,476 W, with 
an engine displacement of not more than 430 cc (described in 
statistical reporting number 8407.90.9040)

[[Page 37383]]

(16) Heat guns (described in statistical reporting number 8419.89.9585)
(17) Heated tissue preparation microscope slide flattening tables 
(described in statistical reporting number 8419.89.9585)
(18) Tissue sample paraffin floatation baths (described in statistical 
reporting number 8419.89.9585)
(19) Air amplifiers powered solely by an external source of compressed 
air, which is routed through the apparatus in such a manner as to draw 
in ambient air, increase its speed and direct the air through an output 
port, each such apparatus not exceeding 1 kg in weight (described in 
statistical reporting number 8424.89.9000)
(20) Apparatus capable of generating and projecting liquid particles of 
a size that simulates haze, fog or snow (depending on the composition 
of the liquid or powdered source), whether or not incorporating laser 
or other lighting apparatus (described in statistical reporting number 
8424.89.9000)
(21) Apparatus capable of mechanically generating and projecting 
bubbles from a liquid source, each apparatus weighing more than 2.5 kg 
but not more than 6.5 kg (described in statistical reporting number 
8424.89.9000)
(22) Aroma-spraying sets, each of which includes a battery-powered 
aerosol apparatus and a glass bottle containing not more than 25 ml of 
essential oil solution, each set weighing not more than 300 g 
(described in statistical reporting number 8424.89.9000)
(23) Collars of a size suitable for dogs or cats, fitted with a means 
to provide a stimulus to the animal, by means of a sprayer, whether or 
not combined with a static electric discharge device or sound emitter; 
and such collars capable of being controlled by an external 
transmission device, whether or not the controller is presented with 
the collar as a set (described in statistical reporting number 
8424.89.9000)
(24) Dispensers of hand-cleaning or hand-sanitizing solutions, whether 
employing a manual pump or a proximity-detecting battery-operated pump, 
each article weighing not more than 3 kg (described in statistical 
reporting number 8424.89.9000)
(25) Oral irrigators (dental water-jet machines) (described in 
statistical reporting number 8424.89.9000)
(26) Parts washers, each consisting of a steel basin having a capacity 
no greater than 100 liters, steel drain plug, support legs and a shelf, 
a recirculating centrifugal pump assembly, a power cord incorporating 
an electrical fusible link, a gooseneck spigot assembly, with a steel 
lid held by a ``piano-type'' hinge and by a lid support bracket 
incorporating a mechanical fusible link (described in statistical 
reporting number 8424.89.9000)
(27) Rotary surface washers, consisting of a tube, at one end of which 
is a fitting suitable for connection to an external power washer and a 
handle for controlling the position of the apparatus, and at the other 
end of which is an assembly of one or more rotating brushes that 
receive the output of the external power washer (described in 
statistical reporting number 8424.89.9000)
(28) Wet- and dry-diffusion apparatus fitted for incorporation into 
scent-releasing machines (described in statistical reporting number 
8424.89.9000)
(29) Walk behind rotary tillers, electric powered, individually 
weighing less than 14 kg (described in statistical reporting number 
8432.29.0060)
(30) Fertilizer distributors with a capacity not exceeding 40 kg 
(described in statistical reporting number 8432.42.0000)
(31) Benchtop drill presses, each with a power rating of less than 750 
watts and valued under $1,000 each (described in statistical reporting 
number 8465.95.0055)
(32) Bearing housings each valued over $2000 (described in statistical 
reporting number 8483.30.8020)
(33) AC motors, of 18.65 W or more but not exceeding 37.5 W, each with 
attached actuators, crankshafts or gears (described in statistical 
reporting number 8501.10.6020)
(34) C-frame 2-pole AC electric motors, of 18.65 W or more but not 
exceeding 37.5 W, each valued not over $4 (described in statistical 
reporting number 8501.10.6020)
(35) Electric motors, of 18.65 W or more but not exceeding 37.5 W, each 
valued over $28 but not over $35 (described in statistical reporting 
number 8501.10.6080)
(36) Amorphous silicon solar chargers with a power output of 100 W or 
less (described in statistical reporting number 8501.31.8010)
(37) Electric motors, each with an output rating not exceeding 800 W 
(described in statistical reporting number 8501.52.4000)
(38) Armature shafts for electric motors of heading 8501 (described in 
statistical reporting number 8503.00.9520)
(39) Windshield wiper motor covers and shafts (described in statistical 
reporting number 8503.00.9520)
(40) Leakage current detection and interruption (LCDI) cords (described 
in statistical reporting number 8536.30.8000)
(41) Control boards for stoves, ranges and ovens of heading 8516 
(described in statistical reporting number 8537.10.3000)
(42) Zener diodes, each valued not over $0.25 (described in statistical 
reporting number 8541.10.0050)
(43) Position or speed sensors for motor vehicle transmission systems, 
each valued not over $12 (described in statistical reporting number 
8543.70.4500)
(44) Wheel speed sensors for anti-lock motor vehicle braking systems, 
each valued not over $12 (described in statistical reporting number 
8543.70.4500)
(45) Antenna amplifiers, each valued not over $15 (described in 
statistical reporting number 8543.70.9960)
(46) Antenna noise suppressors, each valued not over $5 (described in 
statistical reporting number 8543.70.9960)
(47) Apparatus using passive infrared detection sensors designed for 
turning lights on and off (described in statistical reporting number 
8543.70.9960)
(48) Audio controllers, each valued not over $100 (described in 
statistical reporting number 8543.70.9960)
(49) Audio mixers, each valued not over $75 (described in statistical 
reporting number 8543.70.9960)
(50) Devices incorporating sensors and monitors for identifying encoded 
television and radio signal information of survey participants 
(described in statistical reporting number 8543.70.9960)
(51) Electrically powered cat noise control devices (described in 
statistical reporting number 8543.70.9960)
(52) Electrically powered combs of a kind used on pets (described in 
statistical reporting number 8543.70.9960)
(53) Electrically powered dog training, controlling, repelling or 
locating apparatus whether or not put up in kits, including dog collars 
fitted with GPS or other transmitting or receiving devices and 
electrical barrier transmitter devices (described in statistical 
reporting number 8543.70.9960)
(54) Electrically powered insect control apparatus (described in 
statistical reporting number 8543.70.9960)

[[Page 37384]]

(55) Electrically powered static-emitting plastic strips designed for 
use in training or controlling pets (described in statistical reporting 
number 8543.70.9960)
(56) LED lamps for flash curing nail polish (described in statistical 
reporting number 8543.70.9960)
(57) Liquid leak detectors (described in statistical reporting number 
8543.70.9960)
(58) Multiple device remote controls, other than radio remote control, 
each valued not over $2 (described in statistical reporting number 
8543.70.9960)
(59) Robots, programmable, measuring not more than 40 cm high by 22 cm 
wide by 27 cm deep, incorporating an LCD display, camera and microphone 
but without ``hands'' (described in statistical reporting number 
8543.70.9960)
(60) Couplers, knuckles and yokes and parts thereof for vehicles of 
heading 8605 or 8606 (described in statistical reporting number 
8607.30.1000)
(61) Motorcycles (including mopeds), with reciprocating internal 
combustion piston engine of a cylinder capacity not exceeding 50 cc, 
valued not over $500 each (described in statistical reporting number 
8711.10.0000)
(62) Polarizing film, of triacetate, with a pressure sensitive adhesive 
backing (described in statistical reporting number 9001.20.0000)
(63) Digital clinical thermometers, valued not over $11 each (described 
in statistical reporting number 9025.19.8040)
(64) Cooking thermometers, including candy and deep-fry thermometers 
(described in statistical reporting number 9025.19.8080)
(65) Infrared thermometers (described in statistical reporting number 
9025.19.8080)
(66) Combined thermometer and hygrometer devices (described in 
statistical reporting number 9025.80.1000)
(67) Pulse output gas meters of a kind that can be read remotely 
(described in statistical reporting number 9028.10.0000)
(68) Pulse output water meters, of cast stainless steel (described in 
statistical reporting number 9028.20.0000)
(69) Fingertip pulse oximeters (described in statistical reporting 
number 9029.20.4080)''

    3. by amending the last sentence of the first paragraph of U.S. 
note 20(d) to subchapter III of chapter 99 by:
    a. Inserting ``, except products of China granted an exclusion by 
the U.S. Trade Representative and provided for in heading 9903.88.12 
and U.S. note 20(o) to subchapter III of chapter 99'' after the phrase 
``heading 9903.88.02 applies to all products of China that are 
classified in the following 8-digit subheadings'', where it appears at 
the end of the sentence.
    4. by amending the article description of heading 9903.88.02:
    a. By inserting ``Except as provided in heading 9903.88.12,'' 
before ``Articles the product of China, as provided for in U.S. note 
20(c) to this subchapter and as provided for in the subheadings 
enumerated in U.S. note 20(d)''.

[FR Doc. 2019-16256 Filed 7-30-19; 8:45 am]
 BILLING CODE 3290-F9-P