On October 4, 2019, the Office of the US Trade Representative (USTR) posted on its website an advance copy of a Federal Register Notice of Determination and Action Pursuant to Section 301: Enforcement of U.S. WTO Rights in Large Civil Aircraft Dispute to be published in the future. The notice states that USTR has determined that the European Union (EU) and certain member States have denied US rights under the World Trade Organization (WTO) Agreement and have failed to implement WTO Dispute Settlement Body recommendations concerning certain subsidies to the EU large civil aircraft industry. USTR has determined to take action in the form of additional duties on products of certain member States of the EU, as specified in Annex A to the notice. The additional duties set out in Annex A are applicable with respect to products that are entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on October 18, 2019.
The annual trade value of the list of tariff subheadings subject to additional duties is approximately $7.5 billion, which is consistent with the WTO Arbitrator’s finding on the appropriate level of countermeasures. Annex A identifies the products covered by the action, the rate of duty to be assessed, and the EU member States affected. The final list of products and rates of additional duty take into account the public comments and the testimony from the public hearings, the advice of advisory committees, and the advice of the Section 301 Committee. In accordance with section 306(b)(2)(F) of the Trade Act (19 U.S.C. 2416(b)(2)(F)), Annex A includes reciprocal goods of the affected industry. Annex B contains the same list of tariff subheadings, with unofficial descriptions of the types of products covered in each subheading.
In order to implement this determination, effective October 18, 2019, subchapter III of chapter 99 of the HTSUS is modified by Annex A of this notice. Products provided for in new 5 HTSUS subheading 9903.89.05 will be subject to an additional ad valorem duty of 10 percent. Products provided for in new HTSUS subheadings 9903.89.10, 9903.89.13, 9903.89.16, 9903.89.19, 9903.89.22, 9903.89.25, 9903.89.28, 9903.89.31, 9903.89.34, 9903.89.37, 9903.89.40, 9903.89.43, 9903.89.46, and 9903.89.49, will be subject to an additional ad valorem duty of 25 percent.
The 10 percent rate (9903.89.05) applies to:
New airplanes and other new aircraft, as defined in U.S. note 21(b) to this subchapter (other than military airplanes or other military aircraft), of an unladen weight exceeding 30,000 kg (described in statistical reporting numbers 8802.40.0040, 8802.40.0060 or 8802.40.070) from France, Germany, Spain or the United Kingdom.
The additional duties provided for in the new HTSUS subheadings established by Annex A apply in addition to all other applicable duties, fees, exactions, and charges.
Any product listed in Annex A, except any product that is eligible for admission under ‘domestic status’ as defined in 19 CFR 146.43, which is subject to the additional duty imposed by this determination, and is admitted into a U.S. foreign trade zone on or after 12:01 a.m. eastern daylight time on October 18, 2019, only may be admitted as ‘privileged foreign status’ as defined in 19 CFR 146.41. Such products will be subject upon entry for consumption to any ad valorem rates of duty or quantitative limitations related to the classification under the applicable HTSUS subheading.
The U.S. Trade Representative will continue to consider the action taken in this investigation. In determining whether future modifications may be appropriate, the U.S. Trade Representative will take into account the public comments and testimony previously provided in response to the April 12 and July 5 notices. USTR remains open to discussing matters related to this investigation with the EU and EU member States.