Notice of Product Exclusion Extensions: China's Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and Innovation, 59587-59595 [2020-20828]

Agencies

• Office of the United States Trade Representative

[Federal Register Volume 85, Number 184 (Tuesday, September 22, 2020)]
[Notices]
[Pages 59587-59595]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-20828]


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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE


Notice of Product Exclusion Extensions: 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 exclusion extensions.

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SUMMARY: Effective July 6, 2018, the U.S. Trade Representative imposed 
additional duties on goods of China with an annual trade value of 
approximately $34 billion 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 U.S. 
Trade Representative initiated an exclusion process in July 2018 and 
has granted 10 sets of exclusions under the $34 billion action. The 
seventh set of exclusions was published in September 2019 and will 
expire in September 2020. On June 3, 2020, the U.S. Trade 
Representative established a process for the public to comment on 
whether to extend particular exclusions for up to 12 months. This 
notice announces the U.S. Trade Representative's determination to 
extend certain exclusions through December 31, 2020.

DATES: The product exclusion extensions announced in this notice apply 
as of September 20, 2020, and extend through December 31, 2020. 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 Associate General Counsel Philip Butler or Assistant 
General Counsel Benjamin Allen, 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 Annexes to this notice, contact [email protected].

SUPPLEMENTARY INFORMATION:

A. Background

    For background on the proceedings in this investigation, please see 
prior notices including: 82 FR 40213 (August 24, 2017), 83 FR 14906 
(April 6, 2018), 83 FR 28710 (June 20, 2018), 83 FR 32181 (July 11, 
2018), 83 FR 67463 (December 28, 2018), 84 FR 11152 (March 25, 2019), 
84 FR 16310 (April 18, 2019), 84 FR 21389 (May 14, 2019), 84 FR 25895 
(June 4, 2019), 84 FR 32821 (July 9, 2019), 84 FR 43304 (August 20, 
2019), 84 FR 46212 (September 3, 2019), 84 FR 49564 (September 20, 
2019), 84 FR 52567 (October 2, 2019), 84 FR 58427 (October 31, 2019), 
84 FR 70616 (December 23, 2019), 84 FR 72102 (December 30, 2019), 85 FR 
6687 (February 5, 2020), 85 FR 12373 (March 2, 2020), 85 FR 16181 
(March 20, 2020), 85 FR 24081 (April 30, 2020), 85 FR 33775 (June 2, 
2020), 85 FR 34274 (June 3, 2020), 85 FR 41267 (July 9, 2020), and 85 
FR 46777 (August 3, 2020).
    Effective July 6, 2018, the U.S. Trade Representative imposed 
additional 25 percent duties on goods of China classified in 818 eight-
digit subheadings of the Harmonized Tariff Schedule of the United 
States (HTSUS), with an approximate annual trade value of $34 billion. 
See 83 FR 28710 (the $34 billion action). The U.S. Trade 
Representative's determination included a decision to establish a 
process by which U.S. stakeholders could request exclusion of 
particular products classified within an eight-digit HTSUS subheading 
covered by the $34 billion action from the additional duties. The U.S. 
Trade Representative issued a notice setting out the process for the 
product exclusions and opened a public docket. See 83 FR 32181 (the 
July 11 notice).
    In September 2019, the U.S. Trade Representative granted a set of 
exclusion requests, which expire on September 20, 2020. See 84 FR 49564 
(the September 20 notice). On June 3, 2020, the U.S. Trade 
Representative invited the public to comment on whether to extend for 
up to 12 months particular exclusions granted in the September 20 
notice. See 85 FR 34274 (the June 3 notice).
    Under the June 3 notice, commenters were asked to address whether 
the particular product and/or a comparable product is available from 
sources in the United States and/or in third countries; any changes in 
the global supply chain since July 2018 with respect to the particular 
product, or any other relevant industry developments; and efforts, if 
any, importers or U.S. purchasers have undertaken since July 2018 to 
source the product from the United States or third countries.
    In addition, commenters who were importers and/or purchasers of the 
products covered by an exclusion were asked to provide information 
regarding their efforts since July 2018 to source the product from the 
United States or third countries; the value and quantity of the 
Chinese-origin product covered by the specific exclusion request 
purchased in 2018 and 2019, and whether these purchases are from a 
related company; whether Chinese suppliers have lowered their prices 
for products covered by the exclusion following the imposition of 
duties; the value and quantity of the product covered by the exclusion 
purchased from domestic and third country sources in 2018 and 2019; the 
commenter's gross revenue for 2018 and 2019; whether the Chinese-origin 
product of concern is sold as a final product or as an input; whether 
the imposition of duties on the products covered by the exclusion will 
result in severe economic harm to the commenter or other U.S. 
interests; and any additional information in support of or in 
opposition to extending the exclusion.

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    The June 3 notice required the submission of comments no later than 
July 7, 2020.

B. Determination To Extend Certain Exclusions

    Based on an evaluation of the factors set out in the July 11 and 
June 3 notices, 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 U.S. Trade Representative has determined to extend certain product 
exclusions covered by the September 20 notice, as set out in the 
Annexes to this notice.
    The June 3 notice provided that the U.S. Trade Representative would 
consider extensions of up to 12 months. In light of the cumulative 
effect of current and possible future exclusions or extensions of 
exclusions on the effectiveness of the action taken in this 
investigation, the U.S. Trade Representative has determined to extend 
the exclusions in the Annexes to this notice for less than 12 months--
through December 31, 2020. To date, the U.S. Trade Representative has 
granted more than 6,800 exclusion requests, has extended some of these 
exclusions, and may consider further extensions of exclusions.
    The U.S. Trade Representative will take account of the cumulative 
effect of exclusions in considering the possible further extension of 
the exclusions covered by this notice, as well as possible extensions 
of exclusions of other products covered by the action in this 
investigation. The U.S. Trade Representative's determination also takes 
into account advice from advisory committees and any public comments 
concerning extension of the pertinent exclusion.
    In accordance with the July 11 notice, the exclusions are available 
for any product that meets the description in the Annexes, regardless 
of whether the importer filed an exclusion request. Further, the scope 
of each exclusion is governed by the scope of the ten digit HTSUS 
headings and product descriptions in the Annexes to this notice, and 
not by the product descriptions set out in any particular request for 
exclusion.

Joseph Barloon,
General Counsel, Office of the United States Trade Representative.
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[FR Doc. 2020-20828 Filed 9-21-20; 8:45 am]
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