USTR Launches Section 301 Investigation on China’s Compliance with Phase One Trade Agreement

Trade Update • Oct. 27, 2025

Key Points

• The Office of the U.S. Trade Representative (USTR) has started a Section 301 investigation into China’s compliance with the 2019 Phase One Trade Agreement.
• The investigation will review whether China met its trade commitments and assess the impact on U.S. commerce if it did not.
• Public comments are due by December 1, and a public hearing will take place on December 16.
• The review could lead to new U.S. trade actions, such as additional tariffs or other enforcement steps.

On October 24, 2025, The USTR announced a Section 301 investigation on October 24 to evaluate China’s compliance with the Economic and Trade Agreement Between the Government of the United States of America and the Government of the People’s Republic of China, also known as the Phase One Agreement.

The investigation will determine whether China followed through on its commitments, the effect of any non-compliance on U.S. trade, and whether further U.S. action is necessary.

Background on the Phase One Agreement

The U.S. and China signed the Phase One Agreement on December 13, 2019, following months of negotiations. The agreement required China to:

• Improve intellectual property protections
• Address forced technology transfer practices
• Expand market access in agriculture and financial services
• Increase purchases of U.S. goods and services to help reduce the trade imbalance

According to USTR, five years after the agreement took effect, China has not met several commitments, especially related to non-tariff barriers, market access, and U.S. exports.

Legal Basis for the Investigation

Under Section 302(b) of the Trade Act of 1974, the USTR can start an investigation to determine if a foreign government’s actions are actionable under Section 301. This includes cases where:

• U.S. trade rights under an agreement are denied
• A foreign policy or action conflicts with trade commitments
• The U.S. loses benefits under a trade agreement

If violations are found, the USTR can take trade enforcement actions to address the issue.

Public Participation and Hearing Schedule

USTR is seeking public input on the investigation:

• Written comments and hearing requests must be submitted by December 1, 2025.
• A public hearing will be held on December 16, 2025.
• The comment docket will be available on the USTR’s public comment portal.
• A separate docket for hearing requests opens October 31, 2025.

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