Repeat after me: there will be no commercial agreement between the two countries

• Part 1: 749 items will be subject to a 10% duty, including: coffee, corn, caviar, chemicals, cars, buses, scooters and bicycles
• Part 2: 163 items will be taxed with a 10% duty, including: cars and motorcycles
• Part 3: 634 items will be subject to a 5% duty, including: whiskey and cigars
• Part 4: 1815 items will be subject to a 5% fee, including: wood, floors, doors, clothing, CDs, TVs, lights, auto parts and pens

We have considered translating the complete list of products to indicate the breakdown of products on which a 5% tariff increase will be applied, but we decided that it would take too much time and is not really necessary. because the Chinese state the tariff numbers. See Tariff Schedule 1 and Tariff Schedule 2 of China.

China's tariff exclusion requests have a deadline of 18 October

In its previous round of tariff announcements in May, China announced it would launch an exclusion request process for companies that import, manufacture or use US products subject to retaliatory tariffs imposed by China. US companies that do not have Chinese entities (for example, WFOE / WOFE) should ask their Chinese customers to see if they would agree to submit an exclusion request for their products. Some of our US customers who sell their products in China through importers and / or Chinese distributors have done the same, and their Chinese importers / distributors have mostly replied that they would, provided that the American company pays all or part of their taxes. fees and legal fees. Applicants for these exclusions must submit their exclusion requests via the website of the Chinese Fiscal Policy Research Center of the Ministry of Finance. Each application must be limited to one product and must identify the eight-digit tariff position. Requests for exclusion will be examined based on the difficulty of obtaining the US product imported from other sources (domestic, third country) and also on any structural impact on the Chinese industries concerned.

The deadlines for submitting requests for exclusion of products previously priced by China depended on the tariff line and the tariff schedule in question. Exclusion requests for certain excluded products had to be submitted no later than July 5, 2019 (so you are too late for this), and requests for exclusion of other products must be submitted by September 2, 2019 to October 18, 2019. This second deadline for your products on the lists for which you are do not too late to request an exclusion.

New US tariffs on Chinese products

In retaliation for the increase in China's tariffs on US goods (against the US imposing tariffs on Chinese products), President Trump has issued a series of tweets stating following:

1. On October 1, the United States will increase its tariffs by 5% on goods of $ 250 billion already subject to tariffs of 25%.

2. The United States will increase its tariffs by 5% on the remaining $ 300 billion of Chinese goods (mainly consumer goods), which is expected to be 10% effective as of September 1 or December 15.

3. "Our country has stupidly lost billions of dollars with China for many years. They stole our intellectual property for hundreds of billions of dollars a year and they want to continue. I will not let that happen! We do not need China and, frankly, we would be much better without them. The huge amounts of money that the Chinese manufacture and fly in the United States, year after year, for decades, go and must stop. We are ordering our major US companies to immediately start looking for an alternative to China, including bringing our businesses back home and manufacturing your products in the United States. I will respond to China's tariffs this afternoon. This is a great opportunity for the United States. In addition, I order all carriers, including Fed Ex, Amazon, UPS and the Post, to SEARCH AND REFUSE all fentanyl shipments from China (or any other place!). Fentanyl kills 100,000 Americans a year. President Xi said that would stop – this is not the case. Our economy, because of our gains over the last two and a half years, is MUCH larger than China's. We will continue like this!

This morning, the US Trade Representative's Office (USTR) stated the following about yesterday's trade war:

China announced today that it will impose unjustified tariffs on US products. In response to China's decision and in order to achieve the objectives of the Article 301 China Inquiry, President Trump instructed the US Trade Representative (USTR) to increase tariffs by 5%. customs duties on Chinese imports worth about $ 550 billion. For tariffs of 25% on Chinese imports worth about $ 250 billion, the US Trade Representative will begin the process of raising the tariff rate to 30%, effective October 1st, at following notice and a comment period. For the 10% of Chinese import tariffs of about $ 300 billion announced earlier this month by the president, customs duties will now be 15%, as of the dates already set for the increased tariffs on these imports.

The USTR will publish in the Federal Register as soon as possible additional details on today's announcement.

What it means for your business in the United States and China

We assume that you understand how the new tariffs on both sides will increase costs for those who manufacture products in China for sales in the United States and vice versa. To find out who will pay these costs and what you can do to try to reduce them, we invite you to read Who pays the tariffs on imports from China? President Trump against CNN and what YOU can do NOW to reduce your price in China.

But what should you do with President Trump? order Will US companies immediately seek an alternative to China? He can not really do that, is not it? No, but in many ways this is exactly what Trump has been doing since the beginning of the US-China trade war. Trump can not literally force US companies to pull out of China, but he can and has made it so difficult for them to leave China. And that's what most of the international lawyers and international trade lawyers in my cabinet have come to believe to be Trump's plan from the beginning.

At every stage of the process, Trump prevented China from entering into a trade deal with the United States, which is why this blog has always been clear: there will be no trade agreement between the United States and China. If the trade war and the cold war between the United States and China were really about trade imbalances, it would have ended long ago if China bought more soybeans and Boeing aircraft in the United States. But from the beginning, the United States has asked China to stop stealing intellectual property and opening its markets to foreign companies, and there is no way for China to accept these two things. The chief negotiator, Robert Lighthizer, is undoubtedly smart enough to know from the beginning. All this leads us to believe that the American plan has always been to force a slow decoupling of the United States and China, then to convince the rest of the democratic world (EU, Australia, Canada, Latin America, Japan, etc.). . decouple from China, as well. In June, does China want a second decoupling? The Chinese texts say that this is the case, we also explained how China wants this decoupling.

The last "order" of Trump does not have the force of law. It is not an order in this respect. But in most other cases, that's the case. This order indicates Trump's passionate desire to rid the United States of what he sees as the Chinese scourge. More importantly, it's another clear signal that he will continue escalating this war with China until he considers that the United States is victorious. The fact that Trump publishes this "order" in the midst of rising fears of recession only highlights the fact that ending trade between the United States and China is at the top of his to-do list.

This means that you must stop believing that the trade war will provide a solution that will allow you to start doing business with China in the same way you did before. Rather, you must recognize that this is the new normality between the United States and China and that, in any case, things are more likely to get worse than to improve.