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Investigations Cover 60 Trading Partners, May Result in Additional Tariff Action
On Thursday, March 12, the Office of the United States Trade Representative ("USTR") announced it is initiating a suite of investigations under Section 301 of the Trade Act of 1974 regarding "acts, policies, and practices of each of these economies related to the failure to impose and effectively enforce a ban on the importation of goods produced with forced labor."
According to USTR's Federal Register Notice, the lack of effectively enforced forced labor import prohibitions threatens domestic producers who must compete with foreign goods produced with an artificial cost advantage and may harm U.S. workers and citizens through distorting competition and the purchase of goods produced under exploitative conditions.
The agency's announcement - which came less than three weeks after the U.S. Supreme Court struck down President Trump's IEEPA tariffs - was widely-anticipated, as the Administration has said it would use Section 301 investigations, and potential remedies, as part of its effort to quickly rebuild the President's tariff regime.
What Is Section 301?
Section 301 of the Trade Act of 1974 provides a statutory means for the U.S. to impose trade sanctions against foreign countries that violate a U.S. trade agreement or engage in acts, policies, or practices that are "unjustifiable," "unreasonable," or "discriminatory," and burden or restrict U.S. commerce.
The statute defines "unreasonable" acts, policies, and practices to include "a persistent pattern of conduct that...permits any form of forced or compulsory labor."
USTR may initiate a case based on a petition from any interested person or, alternatively, can "self-initiate," as it did in this instance.
The Section 301 process is led by USTR, in coordination with an interagency "Section 301 Committee." The Committee will solicit and review public comments, conduct public hearings, and make recommendations that will inform the final decision(s) by the USTR.
If USTR makes an affirmative determination to take action "to obtain the elimination of such act, policy, or practice," such action must be implemented within 30 days, unless USTR exercises its discretion to delay implementation (by no more than 180 days) under certain specified circumstances. The action(s) taken can affect any goods, services, or other aspects of the trade relationship with the target country, subject to any "specific direction" of the President.
Once an action is in place, Section 301 allows USTR to modify or terminate the action if, for example, the foreign conduct that is the subject of the action "has increased or decreased" or "is no longer appropriate." Section 301 action may continue indefinitely but is subject to termination at the end of four years if the domestic industry benefitting from the action does not request continuation of the action. If a continuation request is submitted before the end of the four-year period, USTR will conduct a review of the efficacy and economic effects of the action before deciding on continuation.
Which Remedies Are Available?
Section 301 authorizes the USTR to: (1) impose duties or other import restrictions (with a preference for duties), (2) withdraw or suspend trade agreement concessions, or (3) enter into a binding agreement with the foreign government to either eliminate the conduct in question (or the burden to U.S. commerce) or compensate the United States with satisfactory trade benefits. Should tariffs be imposed, the statute allows for, but does not require, an exclusion process.
President Trump used Section 301 during his first term to impose sweeping tariffs on Chinese-origin imports after USTR's affirmative determination regarding discriminatory intellectual property rights-related trade and economic practices on the part of the People's Republic of China (PRC). Those tariffs, covering $370 billion in Chinese imports, remain in place today.
What is the Timeline?
Generally, USTR must finish an investigation within 12 months of initiation. In this case, Ambassador Greer has pledged to move on a much quicker timeline. The investigations may be concluded by July 24, 2026, when the temporary Section 122 tariffs are set to expire (see our blog post on those tariffs here).
Is the Action Industry-Specific?
In its May 12 Federal Register Notice, USTR focuses on the absence of enforced forced labor import prohibitions in the 60 economies included within the scope of the investigation. While the notice references the existence of forced labor in various industries - including cotton used to produce garments, textiles, thread and yarn; critical minerals used to produce solar products or auto-parts; fish used to produce fish oil and fish meal; and palm fruit used to produce kernel or palm oil used in various cooking oils and biofuels - the investigation centers on the failure of countries to implement and enforce forced labor import prohibitions to stop the entry of such goods into their markets. The investigation does not focus on the presence of forced labor in any particular industry.
Which Trading Partners Are Covered?
Trading partners subject to the investigations are: Algeria, Angola, Argentina, Australia, The Bahamas, Bahrain, Bangladesh, Brazil, Cambodia, Canada, Chile, China, Colombia, Costa Rica, Dominican Republic, Ecuador, Egypt, El Salvador, the European Union, Guatemala, Guyana, Honduras, Hong Kong/China, India, Indonesia, Iraq, Israel, Japan, Jordan, Kazakhstan, Kuwait, Libya, Malaysia, Mexico, Morocco, New Zealand, Nicaragua, Nigeria, Norway, Oman, Pakistan, Peru, Philippines, Qatar, Russia, Saudi Arabia, Singapore, South Africa, South Korea, Sri Lanka, Switzerland, Taiwan, Thailand, Trinidad and Tobago, Türkiye, United Arab Emirates, United Kingdom, Uruguay, Venezuela, and Vietnam.
Haven't Some of These Governments Implemented, or Committed to Implement, Forced Labor Import Prohibitions?
Yes. Canada and Mexico implemented forced labor import prohibitions pursuant to commitments to the United States to do so in the United States-Mexico-Canada Agreement. The European Union adopted a forced labor regulation prohibiting imports, exports, and domestic sales of forced labor goods that is scheduled to be fully applied in December 2027. Several listed countries also committed to implement forced labor prohibitions in their recent Agreements on Reciprocal Trade with the United States, including Malaysia, Cambodia, El Salvador, Guatemala, Argentina, Bangladesh, Taiwan, and Indonesia.
USTR's inclusion of these countries within the scope of this Section 301 investigation indicates that USTR expects countries not only to commit to adopt forced labor import prohibitions or to adopt them, but to effectively enforce those measures as well.
What Information Is USTR Seeking?
USTR is specifically seeking feedback regarding:
- Whether any economy subject to these investigations maintains or is in the process of establishing a forced labor import prohibition, and whether any such import prohibition is being effectively enforced.
- The extent to which the failure of any economy to establish and effectively enforce a forced labor import prohibition is unreasonable, discriminates against U.S. goods, or constitutes a persistent pattern of conduct that permits any form of forced or compulsory labor.
- The extent to which the failure of any economy to establish and effectively enforce a forced labor import prohibition has negatively affected U.S. commerce, such as through lost U.S. exports or economic output, lower prices for U.S. goods, or lower wages for U.S. workers.
- What action, if any, should be taken to address these issues, including:
- The level and scope, if any, of duties on products of any economy subject to these investigations.
- The level and scope, if any, of import restrictions on products of any economy subject to these investigations. The appropriate aggregate level of trade to be covered by any additional duties on products of any economy subject to these investigations.
- Nothing precludes a stakeholder from commenting in support of action for one or more trading partners and, at the same time, in opposition to action relative to others.
How Can Companies, Industries, and Other Stakeholders Engage?
USTR is soliciting written comments and will hold public hearings beginning April 28, 2026. Given the breadth of the investigation, we anticipate the hearings may last multiple days. USTR has said they will continue, as necessary, until May 1, 2026.
The agency opened a formal docket for public comments on March 12, 2026. Written comments and requests to testify at the public hearing are due April 15 and must be submitted via the agency's docket. Further instructions are included in the Federal Register Notice. Rebuttal comments will be accepted for seven days following the last public hearing day.
Are Additional Section 301 Investigations Expected?
Yes. In a February 20 public statement, Ambassador Greer announced that the Trump Administration would be initiating several Section 301 investigations that it expected "to cover most major trading partners and to address areas of concern such as industrial excess capacity, forced labor, pharmaceutical pricing practices, discrimination against U.S. technology companies and digital goods and services, digital services taxes, ocean pollution, and practices related to the trade in seafood, rice, and other products."
The two Section 301 investigations initiated by USTR this week relate to the first two subjects referenced by Ambassador Greer. See our post on USTR's Section 301 investigations regarding industrial excess capacity and production here.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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