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MemoMemorandumClinton · D Quiet signal

Presidential Memorandum

Action Under Section 203 of the Trade Act of 1974 Concerning Line Pipe

President Clinton imposed a three-year safeguard tariff on imported circular welded carbon quality line pipe, starting at 19% ad valorem and declining to 15% and 11% in years two and three, with a 9,000 short ton exemption per country. Canada and Mexico were excluded from the safeguard measure under NAFTA provisions, and the Secretary of the Treasury was directed to implement monitoring and reporting requirements.

Federal Register Open PDF 65 FR 9197

Impact dates

  1. USITC midpoint monitoring report on domestic industry adjustment

  2. USITC section 332(g) investigation report on effects of action

  3. Secretary of Treasury to seek HTS statistical subdivision for covered products

Key directives

  • Increase duty on certain line pipe to 19% ad valorem year one, 15% year two, 11% year three
  • Exempt first 9,000 short tons per supplying country annually
  • Proclaim action for 3 years and 1 day
  • Secretary of Treasury to publish weekly import statistics by country
  • Secretary of Treasury to establish monitoring categories for API-certified countries
  • Treat imports from non-API-certified countries as subject to action but monitor for transshipment
  • Secretary of Treasury to seek HTS statistical subdivision by March 1, 2000
  • Secretary of Treasury to monitor Canada/Mexico imports quarterly and report to USTR
  • Exclude Canada and Mexico from safeguard measure under NAFTA section 312
  • USTR to request USITC section 332(g) investigation
  • USTR to publish memorandum in Federal Register

Who is ordered

Timeline

Immediate

  • Safeguard tariff takes effect (19% ad valorem)
  • 9,000 short ton country exemption begins
  • Canada and Mexico exclusion from safeguard

Near term (90d)

  • Secretary of Treasury to seek Harmonized Tariff Schedule statistical subdivision by March 1, 2000

Long term

  • Tariff declines to 15% in year two and 11% in year three
  • Three-year and one-day safeguard period
  • USITC midpoint monitoring report due
  • USITC section 332(g) investigation report due with midpoint report

Risks & tensions

  • Potential transshipment through non-API-certified countries to evade tariffs
  • Trade friction with non-NAFTA supplying countries excluded from 9,000-ton exemption
  • Quarterly reporting burden on Treasury; vague on enforcement if thresholds exceeded
  • Midpoint report timing ambiguous—'mid-point of the period' for 3 years and 1 day is approximately 18.5 months
Presidential Memorandum: Action Under Section 203 of the Trade Act of 1974 Concerning Line Pipe · Executive Orders