Question

please let it be typed & please include a example!!!! thank you! this is for my international business class

What is the purpose of Section 201 of the 1974 Trade Act? Who benefits and loses from the enforcement of this law? Please give an example of real world to illustrate your response. The source must be included in your answer. If a student uses an example, then another student cannot use the same. Advice: be the first to post

Answer 1

Introduction to section 201 of trade act 1974

The Section 201 of trade act 1974 is designed to provide permits the President to grant temporary import relief, by raising import duties or imposing nontariff barriers on goods entering the United States that injure or threaten to injure domestic industries producing like goods. Section 201 actions are deemed consistent with U.S. international obligations provided that they conform to the World Trade Organization (WTO) Agreement on Safeguards.

Purpose

If the United States International Trade Commission (hereinafter referred to in this chapter as the ‘‘Commission’’) determines under section 202(b) that an article is being imported into the United States in such increased quantities as to be a substantial cause of serious injury, or the threat thereof, to the domestic industry producing an article like or directly competitive with the imported article, the President, in accordance with this chapter, shall take all appropriate and feasible action within his power which the President determines will facilitate efforts by the domestic industry to make a positive adjustment to import competition and provide greater economic and social benefits than costs.

1. A positive adjustment to import competition occurs when—

a. The domestic industry—

i. is able to compete successfully with imports after actions taken under section 204 terminate, or

ii. The domestic industry experiences an orderly transfer of resources to other productive pursuits; and (B) dislocated workers in the industry experience an orderly transition to productive pursuits.

2. The domestic industry may be considered to have made a positive adjustment to import competition even though the industry is not of the same size and composition as the industry at the time the investigation was initiated under section 202(b).

Enforcement

Though Section 201 is rarely invoked, a major case involving the solar industry in the United States. In April 2017, Suniva, a solar module manufacturer based in Atlanta, Georgia, declared bankruptcy, and in within a week had filed a trade complaint using Section 201 as its primary basis.

Example

Washington, DC – U.S. Trade Representative Robert Lighthizer announced today that President Trump has approved recommendations to impose safeguard tariffs on imported large residential washing machines and imported solar cells and modules.

USTR made the recommendations to the President based on consultations with the interagency Trade Policy Committee (TPC) in response to findings by the independent, bipartisan U.S. International Trade Commission (ITC) that increased foreign imports of washers and solar cells and modules are a substantial cause of serious injury to domestic manufacturers.

“These cases were filed by American businesses and thoroughly litigated at the International Trade Commission over a period of several months,” said Ambassador Lighthizer. “The ITC found that U.S. producers had been seriously injured by imports and made several recommendations to the President. Upon receiving these recommendations, my staff and I conducted an exhaustive process which included opportunities to brief in person and through public comments, public hearings, and meetings with senior representatives. Based on this information, the Trade Policy Committee developed recommendations, which the President has accepted. The President’s action makes clear again that the Trump Administration will always defend American workers, farmers, ranchers, and businesses in this regard.”

For imports of large residential washers, the President approved applying a safeguard tariff-rate quota for three years with the following terms:

	Year 1	Year 2	Year 3
First 1.2 million units of imported finished washers	20%	18%	16%
All subsequent imports of finished washers	50%	45%	40%
Tariff on covered parts	50%	45%	40%
Covered parts excluded from tariff	50,000 units	70,000 units	90,000 units

Injury to U.S. washing machine manufacturers stems from a sharp increase in imports that began in 2012. The ITC found that imports of large residential washers increased “steadily” from 2012 to 2016, and that domestic producers’ financial performance “declined precipitously.”

For imports of solar cells and modules, the President approved applying safeguard tariffs for the next four years with the following terms:

	Year 1	Year 2	Year 3	Year 4
Safeguard Tariff on Modules and Cells	30%	25%	20%	15%
Cells Exempted from Tariff	2.5 gigawatts	2.5 gigawatts	2.5 gigawatts	2.5 gigawatts

The relief will include a tariff of 30 percent in the first year, 25 percent in the second year, 20 percent in the third year, and 15 percent in the fourth year. Additionally, the first 2.5 gigawatts of imported solar cells will be exempt from the safeguard tariff in each of those four years.

The U.S. Trade Representative will engage in discussions among interested parties that could lead to positive resolution of the separate antidumping and countervailing duty measures currently imposed on Chinese solar products and U.S. polysilicon. The goal of those discussions must be fair and sustainable trade throughout the whole solar energy value chain, which would benefit U.S. producers, workers, and consumers.

Following successful trade cases filed by the domestic industry, which levied 40 percent tariffs on Chinese solar imports, China moved production elsewhere and evaded U.S. relief, while maintaining capacity. Today, China dominates the global supply chain and, by its own admission, is looking to increase its capacity to account for 70 percent of total planned global capacity expansions announced in the first half of 2017.

The ITC instituted the cases for Solar and Washers on May 17, 2017, and June 5, 2017 respectively. The ITC then conducted a bipartisan, independent review of the two cases, which included public hearings, before developing various recommendations and reports.

Upon receipt of the ITC’s reports, the Trade Policy Staff Committee, led by the Office of the United States Trade Representative, conducted a thorough interagency process which provided for a public hearing and public comment periods. Ambassador Lighthizer further sought the views of participants in the washer industry and solar producers, importers, and installers before developing the TPC’s recommendation for the President