Trade Compliance

GHY discusses changes to international trade regulations and explores cutting-edge compliance strategies.

Trump Orders U.S. Commerce Department to Expedite National Security Investigation into Steel Imports

Posted April 21, 2017


President Trump yesterday ordered an investigation under Section 232(B) of the Trade Expansion Act of 1962 that directs the Commerce Department to determine within 270 days whether foreign steel imports are threatening to compromise U.S. national security.

U.S. presidents have the executive authority to restrict imports on national-security grounds, though they have rarely done so, instead relying on anti-dumping and countervailing tariff provisions that aim to deter foreign manufacturers from exporting products to the U.S. at below cost, or that are illegally subsidized.

Despite the more than 150 countervailing and anti-dumping duty orders the U.S. government has already initiated against steel imports, the system is “fairly porous,” Commerce Secretary Wilbur Ross said, “so we’re groping here to see whether the facts warrant a more comprehensive solution that would deal with a very wide range of steel products and a very wide range of countries.”

Trump, who campaigned on bringing back jobs to steel mills and other industrial plants that have steadily lost market share to foreign competition, said that steel is too critical a resource for the United States “to become dependent on foreign countries.”

According to a White House fact sheet, the Commerce Department has been asked to expedite its investigation into the effects of steel imports on national security to determine if steel imports cause U.S. workers to lose jobs needed to meet national security requirements in the domestic steel industry; to report on any negative impact on government revenue from steel imports; and to detail any harm caused to the economic welfare of the U.S. given the relationship between the steel industry and national security.

Commerce Secretary Ross said he believes his department can submit its report fairly soon because of investigative work that has already been carried out in other trade remedy cases dealing with steel. He added that at least one public hearing will be held and comments will be called for.

Under the Trade Expansion Act, if Commerce determines that steel imports “threaten to impair the national security,” the president then has 90 days to determine if he concurs – and to take action to “adjust the imports of an article and its derivatives” or take other non-trade-related actions.

“The success of this effort will depend on the scope of the inquiry and the recognition of how important the entire steel sector is to our security interests,” United Steelworkers international president Leo Gerard said in a statement. “This study, once completed, will give the President the justification to act to protect our national security, and to stop the predatory and protectionist imports from flooding our shores and decimating our productive capacity.”

The USW head warned, however, that if the Trump administration’s investigation does not result in meaningful action to curb Chinese steel imports, “radical action will be necessary.”

Related: Press Briefing by Secretary of Commerce Wilbur Ross