NEW CHINA TARIFFS EXPLAINED: WHAT TARIFF LAWYERS KNOW ABOUT THE FEBRUARY 1 EXECUTIVE ORDER
The situation regarding tariffs on Canada, Mexico, and China continues to develop. On Saturday, February 1, 2025, President Trump signed an executive order imposing a tariff of 25% on all Chinese origin goods. The essential elements are as follows:
The President previously signed Executive Order (“EO”) 10886, which declared a national emergency related to the southern border of the United States. The EO signed on February 1, expands the scope of EO 10886 to include the “public health crisis” created by illicit drugs originating in China. Under the International Emergency Economic Powers Act, the President has the authority to respond to national emergencies by applying tariffs.
The EO imposes an additional 25% tariff on “all articles that are products of [China].” The duty rates apply to all goods entered or withdrawn for consumption on or after 12:01 AM EST on February 4, 2025. However, all goods in transit on the final mode of transportation en route to the United States before 12:01 AM EST on February 1, 2025 are exempt from the tariff, if accompanied by a certificate from the importer. The EO also reserves the authority to increase the scope or amount of the tariffs in response to retaliation.
In addition to the tariffs themselves, the EO eliminates duty drawback for the tariffs as well as de minimis duty free treatment.
Chinese officials are scrambling to address these tariff measures. China has announced that it plans to bring a claim to the dispute resolution body of the World Trade Organization (“WTO”). The outcome of this claim is uncertain, given that the WTO’s dispute settlement body is currently in a state of limbo.
As new tariff regulations continue to evolve, navigating these changes requires experienced legal counsel. At Liang + Mooney, PLLC, our seasoned tariff lawyers can answer your questions and concerns with sophisticated legal solutions. If you seek strategic counsel and insight into how these changes could affect your operations, we invite you to contact us to schedule a consultation.