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US senators seek formal review of Section 232 tariff exclusion process

Pittsburgh — A bipartisan group of US senators have requested a formal review of the Section 232 tariff exclusion process administered by the Commerce Department, which allows US companies to request product-specific exclusions to the Section 232 levies on steel and aluminum imports.

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Senators Pat Toomey (Republican-Pennsylvania), Doug Jones (Democrat-Alabama) and Tom Carper (Democrat-Delaware) sent a letter Monday to Comptroller General Gene Dodaro of the Government Accountability Office requesting a review of the process. After the US introduced tariffs of 25% on steel imports and 10% on aluminum imports March 23, the Commerce Department established a process for US companies to file product-specific exclusion requests for cases in which there is no domestic availability or overriding national security concerns with regard to the specific product.

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In the letter, the senators argue the exclusion process for the steel and aluminum tariffs has created a large backlog of petitions and has placed "significant" burdens on US businesses. By the end of October, Commerce had received 49,301 exclusion petitions (including resubmissions) and had issued decisions for just 16,567, or 34%, of them, according to the letter.

"Members of Congress and US businesses have repeatedly raised concerns about the pace, transparency, and fairness of the Section 232 steel and aluminum exclusion process," the letter states. "For example, the Senate Finance Committee and industry groups have called on Commerce to clarify the criteria it uses to determine whether to grant an exclusion from the tariffs."

To ensure that Congress has a better understanding of the exclusion process, the lawmakers have asked the comptroller general to initiate a review that evaluates the following questions:

  • How has Commerce incorporated feedback from petitioners, members of Congress, and other stakeholders to develop and improve upon its exclusion process?
  • What criteria does Commerce use to make a determination to approve or deny an exclusion petition? How does Commerce adjudicate rebuttals?
  • What steps has Commerce taken to ensure the timely processing of exclusion petitions, including additional staffing and resources? What steps could Commerce take to improve the pace of its exclusion process?
  • How has Commerce trained staff to properly evaluate petitions?
  • What is the average amount of time Commerce takes to issue a decision on a petition? How does the rebuttal and surrebuttal process for opposition comments increase this timeline?
  • What has been the cost to date of the 232 exclusion process, including the costs of increased staffing to evaluate petitions?
  • How does Commerce ensure transparency and adequate communication with petitioners? How frequently does Commerce contact petitioners for additional information, if needed? How quickly does Commerce correct any mistakes in the administration of the exclusion petition process?
  • What degree of technical support has Commerce provided to assist petitioners, particularly small businesses, in filing exclusion petitions?

Commerce did not immediately respond to a request for comment Tuesday.

Commerce's Office of Inspector General initiated an audit of the Section 232 exclusion process at the start of November.

-- Justine Coyne, justine.coyne@spglobal.com

-- Edited by Richard Rubin, newsdesk@spglobal.com

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