On February 21, 2020, the Office of the US Trade Representative (USTR) published in the Federal Register a notice [Docket No. USTR-2019-0003] making adjustments to its WTO-authorized retaliation action relating to the Large Civil Aircraft case, which was implemented on October 18, 2019. The United States is increasing the additional duty rate imposed on aircraft imported from the EU to 15% from 10%, effective March 18, 2020, and making certain other minor modifications, effective March 5, 2020. This action had been announced by USTR on February 14, 2020 and an advance copy of the Federal Register notice made available at that time.

On December 12, 2019, USTR announced a review of the Section 301 action and requested public comments (see 84 Fed. Reg. 67992, December 12, 2019). Based on this review, the USTR has determined to increase the duties on certain large civil aircraft from 10 to percent to 15 percent, and to change the composition of the list of products subject to additional duties of 25 percent. As of this time, USTR has decided not to increase the rate of additional duties above the additional 25 percent currently being applied to non-aircraft products. The USTR has also determined that going forward, the action may be revised as appropriate immediately upon any EU imposition of additional duties on US products in connection with the Large Civil Aircraft dispute or with the EU’s WTO challenge to the alleged subsidization of US large civil aircraft.

The modifications set out in Annex 1, subparagraphs A and B, are applicable with respect to products that are entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. EST on March 5, 2020. The modifications to the Section 301 action set out in Annex 1, subparagraph C, are applicable with respect to products that are entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. EST on March 18, 2020.

In order to implement this determination, effective March 5, 2020, subchapter III of chapter 99 of the HTSUS is modified by subparagraphs A and B of Annex 1 to the notice. Effective March 18, 2020, subchapter III of chapter 99 of the HTSUS is modified by subparagraph C of Annex 1 to the notice. The additional duties provided for in the HTSUS subheadings established by Annex 1 apply in addition to all other applicable duties, fees, exactions, and charges.

March 5, 2020:

  • US note 21(a) is modified by replacing 9903.89.50 with 9903.89.52;
  • US note 21(g) to subchapter III of chapter 99 is modified by deleting “2009.89.40” [prune juice];
  • US note 21 (q) is added to cover all products of France or Germany that are classified in subheading 8214.90.60 [Butchers’ or kitchen chopping or mincing knives (other than cleavers with their handles)]

March 18, 2020:

  • 9903.89.05 is modified by deleting “10%” and inserting “15%” in lieu thereof for products of France, Germany, Spain or the United Kingdom;

Any product listed in Annex 1 to the notice, except any product that is eligible for admission under ‘domestic status’ as defined in 19 C.F.R. 146.43, which is subject to the additional duty imposed by this determination, and is admitted into a US foreign trade zone on or after 12:01 a.m. eastern daylight time on March 5, 2020, for products listed in subparagraphs A and B (or March 18 for products listed in subparagraph C), only may be admitted as ‘privileged foreign status’ as defined in 19 C.F.R. 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 notice states that the United States remains open to a negotiated settlement that addresses current and future subsidies to Airbus provided by the EU and certain current and former member States