Section 301 Forced-Labor Tariffs: First Lawsuits Filed
The Section 301 tariffs set at 10% or 12.5% that took effect July 24 are now facing legal challenges. Once again, the Liberty Justice Center is the leader in the fight against unjust tariffs. Multiple lawsuits have been filed, with the key argument that the administration was motivated primarily to maintain tariffs to replace the IEEPA tariffs, and that the USTR skipped the country-specific analysis the statute requires. The plaintiffs are seeking an injunction against collection and liquidation of the new duties. Nothing has been decided yet, and all parties must continue to pay the new tariffs. We will be keeping an eye on the court’s action and will report back on both the Section 301 and Section 122 challenges as more information is available.
Section 301 Excess Capacity Investigation: Decision Window Now Open
Separate from the forced-labor action, USTR’s investigation into “structural excess capacity” in 16 economies ( EU, China, Japan, Mexico, Taiwan, Singapore, Switzerland, Norway, India, Indonesia, Malaysia, Vietnam, Thailand, Cambodia, Bangladesh and South Korea) had an unofficial target completion date of July 24 for the final report on actionable items, but this has not been published yet. The current expectation is late summer or early fall and the publication should be followed by a public comment period and then implementation. For the EU, any EU tariff arising from this investigation should be capped at 5% to remain at the15% Turnberry agreement ceiling. We’ll flag this the moment something is published.
Brazil: Retaliation Threatened, Not Yet Acted On
Brazil’s 25% Section 301 tariff remains in effect since July 22. Brasília has vowed to retaliate using its “Reciprocity Law” and to raise the matter at the WTO, but no concrete retaliatory measures have been confirmed as of this week.
Canada: Section 338 Standoff Hardens
Canada trade minister Dominc LeBlanc and Chief Trade Negotiator Janice Charette met with USA officials this week in Washington DC but no real news has been reported as to the results of the talks. Two US trade unions sent a letter to USTR Jamieson Greer asking the administration to reconsider the imposition of Section 338 tariffs and return to a stable trade relationship with Canada. Canadian unions have also voiced their concerns due to the potential impact on autos, forestry, and other manufacturing sectors. We will be closely watching the developments as the August 19 date for 50% tariffs is quickly approaching.
USMCA: Mexico Moves Forward, Canada Hasn’t Started
President Trump continues to proclaim that the USMCA agreement is not important to the US. With that said, Mexico and the US held their third round of talks on the agreement in Mexico City July 21-23 with some progress, but talks with Canada have been focused on the Section 338 tariff threat, not the USMCA. As a reminder, the USMCA agreement remains in place as is until any updates are finalized.
CAPE/IEEPA Refunds: Broader Order, Dates on the Calendar
Correction to last update: the CIT’s reliquidation order came July 17 (not July 21), and it’s broader than just named plaintiffs — it reaches any plaintiff entries liquidated more than 80 days ago where IEEPA deposits were made, plus entries moving through CAPE. The government’s Federal Circuit appeal is still pending. If it is upheld, it could limit refunds for “finally” liquidated entries to importers who have filed lawsuits in the CIT. Three dates to watch: CBP’s status report is due August 4, a closed settlement conference is set for August 5, and a class-certification hearing for IEEPA refund plaintiffs is scheduled for August 6 — that hearing could clarify options for importers who haven’t filed suit. Should you want more information on the status and options available, please reach out to us.
Rhine Water Levels: Hovering Just Above the 2018 Record
The Kaub gauge read 29 cm on Thursday (July 30) and is forecast to dip toward 26 cm by Monday, August 3 — expected to hold just above the all-time record low of 25 cm set in October 2018. With the extremely low water conditions, barges are running at a fraction of capacity across the board. Low water surcharges continue to be imposed and the restriction on the barges is creating congestion for rail and truck transport. Plan shipments accordingly as transport from inland location is taking much longer than usual.
Antwerp & North Europe Update
An update to what we reported last week: beyond the berth at MPET still being out of operation, trade press now reports that three of the ship-to-shore cranes may need to be replaced outright rather than repaired, following the July 14 hydrofluoric acid leak. The leak severely corroded equipment and halted operations, as well as sending many workers to the hospital and creating a toxic cloud. DP World’s Antwerp Gateway and the unaffected portion of MPET have returned to normal operations, but the damaged quay’s capacity could remain constrained for an extended period. Vessel backlogs and high yard density continue to create longer than normal turn times in the port. All North Europe ports are busy and vessels are sailing at full capacity, and thousands of containers are being rolled each week. We expect heavy bookings through mid to late August on this lane due to changes in vessel strings and multiple blank sailings. Plan for potential delays and extra expense for cargo moving to the USA from North Europe.
Barcelona Rail: ADIF Suspension Begins Saturday
ADIF’s (Administrator of Railway Infrastructure) full suspension of cargo rail service to and from the Port of Barcelona begins this Saturday, August 2, and runs through August 8, with partial restrictions continuing through August 24. After the full shutdown, partial restrictions may remain in place through August 24 due to ongoing infrastructure works during night time hours. Alternative solutions for the transport of cargo will be utilized but please allow extra time to get cargo to the port of Barcelona during this period.
Chile/Andes: Mendoza Border Still Closed
The Mendoza-Chile crossing (Los Libertadores) remains closed on adverse high-mountain weather, with roughly 1,500 trucks queued and the crossing expected to stay shut through next week. Pending Argentine cargo is now realistically targeting vessels with an ETD in week 33 (week of August 10). Chilean ports are operating normally for now, but forecasted weather in the region could change that quickly. For urgent cargo in the Mendoza area, alternatives are available. Please let us know if you would like further information on the options.
Spain & France Wildfires: Real Progress, But Not Over
Genuine improvement to report: Spain contained its largest wildfire on record on July 29, and the Madrid-region fire has stabilized enough for tens of thousands of evacuated residents to return home. However, the Castellón fire remains out of control after burning nearly 25,000 acres and displacing more than 10,000 people. In France, the main fire line near Bordeaux has held steady for two days at around 42,000 hectares burned, about 9 miles from the city. The concern now is a fresh heatwave moving into the region, which authorities warn could reignite containment lines that are currently holding. Main highways, ports, and long-haul freight routes remain unaffected in both countries but many offices in the Bordeaux area are closed due to evacuation orders. LCL
Services from France, Italy, and Spain/Portugal – SUMMER UPDATE! Bi-monthly departures continue from each of these countries for your small shipments, offering a per case rate from point of pick up to the Alba Wine and Spirits warehouse in Edison, New Jersey. For the summer months, all containers will be temperature controlled, ensuring your cargo is protected from summer heat. Shipments from other European countries can be added into the mix, with pick-ups offered in most European countries. Please let us know if you need any further information!