Initiation of Section 301 Investigation: China's Acts, Policies, and Practices Targeting the Maritime, Logistics, and Shipbuilding Sectors for Dominance, 29424-29426 [2024-08515]

Agencies

• Office of the United States Trade Representative

[Federal Register Volume 89, Number 78 (Monday, April 22, 2024)]
[Notices]
[Pages 29424-29426]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-08515]


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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE

[Docket Nos. USTR-2024-0004, USTR-2024-0005]


Initiation of Section 301 Investigation: China's Acts, Policies, 
and Practices Targeting the Maritime, Logistics, and Shipbuilding 
Sectors for Dominance

AGENCY: Office of the United States Trade Representative.

ACTION: Notice of investigation initiation, hearing, and request for 
comments.

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SUMMARY: On March 12, 2024, the Office of the United States Trade 
Representative (USTR) received a petition requesting an investigation 
of China's acts, policies, and practices targeting the maritime, 
logistics, and shipbuilding sectors for dominance. On consideration of 
the petition and the advice of the Section 301 Committee, the U.S. 
Trade Representative has initiated an investigation into the issues 
raised in the petition. The inter-agency Section 301 Committee will 
hold a public hearing and is seeking public comments in connection with 
this investigation.

DATES: 
    April 17, 2024: The U.S. Trade Representative initiated the 
investigation.
    May 22, 2024: To be assured of consideration, submit written 
comments and any requests to appear at the hearing, along with a 
summary of the testimony, by this date.
    May 29, 2024: The Section 301 Committee will convene a public 
hearing in the main hearing room of the U.S. International Trade 
Commission Building, 500 E Street SW, Washington DC, beginning at 10 
a.m. If necessary, the hearing may continue on May 31, 2024.
    Seven days after the last day of the public hearing: Submit post-
hearing rebuttal comments.

ADDRESSES: Submit documents in response to this notice, including 
written comments, hearing appearance requests, summaries of testimony, 
and post-hearing rebuttal comments through the appropriate online USTR 
portal at: https://comments.ustr.gov/s/.

FOR FURTHER INFORMATION CONTACT: Megan Grimball and Philip Butler, 
Chairs of the Section 301 Committee, or Assistant General Counsels 
Thomas Au and Henry Smith, (202) 395-5725.

SUPPLEMENTARY INFORMATION:

I. Summary of the Petition

    On March 12, 2024, five labor unions \1\ filed a Section 301 
petition regarding the acts, policies, and practices of China to 
dominate the maritime, logistics, and shipbuilding sector.\2\ The 
petition was filed pursuant to section 302(a)(1) of the Trade Act of 
1974, as amended (Trade Act) (19 U.S.C. 2412(a)(1)), requesting action 
pursuant to Section 301(b) (19 U.S.C. 2411(b)).
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    \1\ The five petitioners are the United Steel, Paper and 
Forestry, Rubber, Manufacturing, Energy, Allied Industrial and 
Service Workers International Union, AFL-CIO CLC (USW), the 
International Brotherhood of Electrical Workers (IBEW), the 
International Brotherhood of Boilermakers, Iron Ship Builders, 
Blacksmiths, Forgers and Helpers, AFL-CIO/CLC (IBB), the 
International Association of Machinists and Aerospace Workers (IAM), 
and the Maritime Trades Department of the AFL-CIO (MTD).
    \2\ For additional information, the full text of the petition 
and accompanying exhibits are available at: https://ustr.gov/issue-areas/enforcement/section-301-investigations/section-301-petition-china-maritime-logistics-and-shipbuilding-sector.
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    Petitioners allege that China targets the maritime, logistics, and 
shipbuilding sector for dominance and engages in a wide range of 
unreasonable or discriminatory acts, policies, and practices that 
provide unfair advantages across maritime industries, such as 
shipbuilding, shipping, and maritime equipment, including:
     Implementing industrial planning and policies that are 
designed to unfairly capture market share, distort global markets, and 
advantage Chinese enterprises;
     Directing mergers and anticompetitive activities;
     Providing non-market advantages to Chinese firms to 
dominate key upstream inputs and technologies;
     Providing advanced financing mechanisms advantaging 
Chinese industry;
     Creating a Chinese network of upstream suppliers, foreign 
ports and terminals, shippers, and equipment and logistics software 
that allow advantageous use of information;
     Tolerating intellectual property theft and industrial 
espionage; and
     Controlling shipping freight rates and capacity 
allocations.
    The petitioners also aver that China threatens to discriminate 
against U.S. commerce and disrupt supply chains.
    Petitioners allege that China's acts, policies, and practices 
burden or restrict U.S. commerce by:
     Dramatically increasing China's shipbuilding excess 
capacity and global market share, contributing to declines in U.S. 
shipbuilding capacity, production, and market share;
     Artificially depressing prices, which makes it more 
difficult for U.S. companies to compete for sales;
     Impeding U.S. investment, production, and employment;
     Reducing the number of U.S.-produced ships in the domestic 
and global merchant fleets; and
     Providing unfair advantages and preferences that burden or 
restrict trade in inputs, and burden or restrict trade opportunities 
for upstream inputs and downstream industries.
    In addition, the petitioners assert that China threatens to 
undermine U.S. national and economic security.

II. Initiation of a Section 301 Investigation

    Pursuant to section 302(a)(2) of the Trade Act, the U.S. Trade 
Representative reviewed the allegations in the petition, and after 
receiving the advice of the section 301 Committee, the U.S. Trade 
Representative determined to initiate an investigation regarding the 
issues raised in the petition. In accordance with Section 303(a) of the 
Trade Act, USTR is requesting consultations with the government of 
China. Petitioners have requested a public hearing. In accordance with 
section 302(a)(4), and with the agreement of the petitioners, the 
section 301 Committee will hold a public hearing on this matter on May 
29, 2024.

III. Relevant Provisions of the Trade Act

    Section 302(a)(4) of the Trade Act authorizes the U.S. Trade 
Representative to initiate an investigation to determine whether an 
act, policy, or practice of a foreign country is actionable under 
section 301 of the Trade Act. Actionable matters under section 301 
include acts, policies, and practices of a foreign country that are 
unreasonable or discriminatory and burden or restrict U.S. commerce. 
See Section 301(b)(1). An act, policy, or practice is unreasonable if, 
while not necessarily in violation of, or inconsistent with, the 
international legal rights of the United States, it is otherwise unfair 
and inequitable. See Section 301(d)(3)(A). The statute provides that 
acts, policies, and practices that are unreasonable include any act, 
policy, or practice, or any combination of acts, policies, or

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practices, which constitutes export targeting. See Section 
301(d)(3)(B)(ii). Export targeting means any government plan or scheme 
consisting of a combination of coordinated actions (whether carried out 
severally or jointly) that are bestowed on a specific enterprise, 
industry, or group thereof, the effect of which is to assist the 
enterprise, industry, or group to become more competitive in the export 
of a class or kind of merchandise. See Section 301(d)(3)(E). The 
statute also provides that an act, policy, or practice of a foreign 
country that burdens or restricts U.S. commerce may include the 
provision, directly or indirectly, by that foreign country of subsidies 
for the construction of vessels used in the commercial transportation 
by water of goods between foreign countries and the United States. See 
Section 301(d)(2).
    Pursuant to section 304 of the Trade Act, the U.S. Trade 
Representative will determine on the basis of the investigation whether 
any act, policy, or practice described under section 301(b) exists. If 
that determination is affirmative, the U.S. Trade Representative will 
determine whether action is appropriate, and if so, what action to 
take. See Section 304(a)(1)(B).

IV. Request for Public Comments

    You may submit written comments on any issue covered by the 
investigation. In particular, USTR invites comments on:
     China's acts, policies, and practices targeting the 
maritime, logistics, and shipbuilding sectors for dominance;
     Whether China's acts, policies, and practices targeting 
the maritime, logistics, and shipbuilding sectors for dominance are 
unreasonable or discriminatory;
     China's efforts to dominate the global maritime, 
logistics, and shipbuilding sectors, including the upstream and 
downstream supply chain, as well as shipping services;
     Information on other acts, policies, and practices of 
China relating to the maritime, logistics and shipbuilding sectors, 
including:
     political guidance, directives, and control within state 
and private enterprises,
     activities of state-owned or state-controlled enterprises,
     market access and investment restrictions,
     opaque regulatory preferences and discrimination,
     wage-suppressing labor practices,
     state support of industry (including government guidance 
funds),
     forced technology transfer (including state-sponsored 
cyber theft of intellectual property), or
     other means employed by China to achieve its goals, which 
might be included in this investigation, or be addressed through other 
applicable mechanisms;
     Whether China's acts, policies, and practices burden or 
restrict U.S. commerce, and if so, the nature and level of the burden 
or restriction. Such comments may include economic assessments of the 
burden or restriction on any sector or industry, as well as assessments 
of the burden or restriction on labor in the United States related to 
the acts, policies, and practices under investigation;
     The determinations required under section 304 of the Trade 
Act; and
     Any other views concerning issues raised in the petition.
    To be assured of consideration, USTR must receive written comments 
by May 22, 2024. Additional instructions on how to submit written 
comments are provided in section V below.
    The Section 301 Committee will convene a public hearing on May 29, 
2024, in the main hearing room of the U.S. International Trade 
Commission, 500 E Street SW, Washington DC 20436, beginning at 10 a.m. 
Persons wishing to appear at the hearing must provide written 
notification of their intention and a summary of the proposed testimony 
by 11:59 p.m. on May 22, 2024, using the procedures in section V below. 
Remarks at the hearing are limited to five minutes to allow for 
possible questions from the Section 301 Committee.
    Post-hearing rebuttal comments, which should be limited to 
rebutting or supplementing testimony at the hearing, may be submitted 
within seven calendar days after the last day of the public hearing. 
Post-hearing rebuttal comments must be submitted using the electronic 
portal following the instructions in section V below.

V. Procedures for Notification of Intent To Testify and Written 
Submissions, Including Rebuttal Submissions

    You must submit written comments, requests to appear at the 
hearing, summaries of testimony, and post-hearing rebuttal comments 
using the appropriate docket on the portal at https://comments.ustr.gov/s/. To submit written comments, including post-
hearing rebuttal comments, use the docket on the portal entitled 
``Request for Comments on the Section 301 Investigation of China's 
Acts, Policies, and Practices Targeting the Maritime, Logistics, and 
Shipbuilding Sectors for Dominance'', docket number USTR-2024-0005.
    Persons wishing to provide testimony at the hearing must submit a 
notification of intent and summary of testimony using the docket 
entitled: ``Request to Appear at the Hearing on the Section 301 
Investigation of China's Acts, Policies, and Practices Targeting the 
Maritime, Logistics, and Shipbuilding Sectors for Dominance'', docket 
number USTR-2024-0004.
    You do not need to establish an account to submit comments or 
notification of intent to testify. The first screen of each docket 
allows you to enter identification and contact information. Third party 
organizations such as law firms, trade associations, or customs 
brokers, should identify the full legal name of the organization they 
represent, and identify the primary point of contact for the 
submission. Information fields are optional; however, your comment or 
request may not be considered if insufficient information is provided.
    Fields with a gray Business Confidential Information (BCI) notation 
are for BCI information which will not be made publicly available. 
Fields with a green (Public) notation will be viewable by the public.
    After entering the identification and contact information, you can 
complete the remainder of the comment, or any portion of it by clicking 
``Next.'' You may upload documents at the end of the form and indicate 
whether USTR should treat the documents as business confidential or 
public information.
    Any page containing BCI must be clearly marked `BUSINESS 
CONFIDENTIAL' on the top of that page and the submission should clearly 
indicate, via brackets, highlighting, or other means, the specific 
information that is BCI. If you request business confidential 
treatment, you must certify in writing that disclosure of the 
information would endanger trade secrets or profitability, and that the 
information would not customarily be released to the public.
    Parties uploading attachments containing BCI also must submit a 
public version of their comments. If these procedures are not 
sufficient to protect BCI or otherwise protect business interests, 
please contact the USTR section 301 support line at (202) 395-5725 to 
discuss whether alternative arrangements are possible.
    USTR will post attachments uploaded to the docket for public 
inspection, except for properly designated BCI. You can view 
submissions on USTR's

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electronic portal at https://comments.ustr.gov/s/.

Juan Millan,
Acting General Counsel, Office of the United States Trade 
Representative.
[FR Doc. 2024-08515 Filed 4-19-24; 8:45 am]
BILLING CODE 3390-F4-P