Tonight, the White House released Executive Orders placing additional duties on all imports from Canada, Mexico, and China under the International Emergency Economic Powers Act (IEEPA), among other authorities. The Executive Orders and associated Fact Sheet are linked below.
Duties:
- Canada:
- 25% ad valorem duties on all imported products of Canada, except "energy or energy resources";
- 10% on "energy or energy resources" (defined in section 8 of the National Energy Emergency Proclamation 14156 of January 20, 2025, as "crude oil, natural gas, lease condensates, natural gas liquids, refined petroleum products, uranium, coal, biofuels, geothermal heat, the kinetic movement of flowing water, and critical minerals . . . .").
- Mexico: 25% ad valorem duties on all imported products of Mexico; and
- China: 10% ad valorem duties on all imported products.
Legal Authority: IEEPA and initial national fentanyl emergency announcement in Proclamation 10886 of January 20, 2025.
Effective Date: Effective for goods entered or withdrawn for consumption on or after 12:01 am February 4, 2025, except for goods already in transit as of 12:01 am February 1, 2025, with importer certification.
Additional Details:
- Duties are in addition to all other applicable duties including those required by AD/CVD law, Section 232, Section 301, and normal customs duties.
- Duty drawback is not available.
- De minimis treatment is not available.
- President may expand scope or increase duties in response to Canadian, Mexican, or Chinese retaliation.
- Certain cabinet agencies are tasked with recommending additional action if Canada fails to take steps to alleviate illegal migration and the illicit drug crisis.
Exclusions: No product exclusions, and no process for applying for exclusions, are set forth in the Executive Orders. The Executive Orders do state that the Secretary of Homeland Security, in consultation with the Secretary of the Treasury, the Attorney General, and the Secretary of Commerce, is authorized to take such actions, including adopting rules and regulations, and to employ all powers granted to the President by IEEPA as may be necessary to implement the order. This may allow for an exclusion process yet to be announced if the tariffs remain in effect for an extended period. If any exclusion process operates similar to the Section 232 process, we might anticipate that exclusions could be give retroactive effect. The lack of an announced exclusion process does not mean that the Administration will not entertain exclusions.
Implementation: A Federal Register notice will be published, which will announce changes to HTSUS. This would seem to indicate normal country of origin rules will apply, rather than the USMCA rules of origin for preferences. More clarification may come with the Federal Register notice in the next few days.
Please find the White House Fact Sheet and Three Accompanying Executive Orders here:
Fact Sheet: President Donald J. Trump Imposes Tariffs on Imports from Canada, Mexico and China
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