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1 1 (December 09, 2020)

handle is hein.crs/govdcxs0001 and id is 1 raw text is: * Updated December 9, 2020 Section 232 of the Trade Expansion Act of 1962 B ackground The Trump Administration conducted multiple investigations under Section 232 of the Trade Expansion Act of 1962 (19 U.S.C. §1862, as amended) to determine if certain imports threaten to impair national security. President Trump acted after five separate investigations found potential threats; two investigations are ongoing and another was terminated. Prior to the Trump Administration, a president last imposed tariffs or other trade restrictions under Section 232 in 1986, based on a 1983 probe into imports of machine tools. Recent actions under Section 232 have generated debate in Congress and at the multilateral level. Some in Congress favor legislative initiatives to amend the congressional delegation of authority. Secton 232 Poes Section 232 allows any department, agency head, or any interested party to request the Department of Commerce (Commerce) to initiate an investigation to ascertain the effect of specific imports on U.S. national security. Commerce may self-initiate an investigation. Investigation. Once a Section 232 investigation is requested in writing, Commerce must immediately initiate an appropriate investigation to determine the effects on the national security of the subject imports. After consulting with the Secretary of Defense, other appropriate officers of the United States, and the public, if appropriate, Commerce has 270 days from the initiation date to prepare a report advising the President on whether the targeted product is being imported in certain quantities or under such circumstances to impair U.S. national security, and to provide recommendations based on the findings. The Bureau of Industry and Security (BIS) at Commerce conducts the investigation (15 CFR Section 705). In terms of national security, Commerce considers (1) existing domestic production of the product; (2) future capacity needs; (3) manpower, raw materials, production equipment, facilities, and other supplies needed to meet projected national defense requirements; (4) growth requirements, including the investment, exploration, and development to meet them; and (5) any other relevant factors. On imports, Commerce must consider (1) the impact of foreign competition on the domestic industry deemed essential for national security; (2) the effects that the displacement of domestic products cause, including substantial unemployment, decreases in public revenue, loss of investment, special skills, or production capacity; and (3) any other relevant factors that are causing, or will cause, a weakening in the national economy. Commerce may request public comments or hold hearings, if appropriate. An Executive Summary of the final report (excluding any confidential or classified material) must be published in the Federal Register. Presidential Action and Notification. If Commerce finds in the negative, Commerce informs the President and no further action is required. If Commerce determines in the affirmative, the President, upon receipt of the report, has 90 days to (1) determine whether he/she concurs with its findings; and (2) if so, determine the nature and duration of the action to be taken to adjust the subject imports. The President may decide to impose tariffs or quotas to offset the adverse effect, without any limits on their duration, or take other action. The President may exclude specific products or countries. After a determination, the President must implement the action within 15 days, and submit a written statement to Congress explaining the actions or inaction within 30 days (see Figure 1). The President must also publish his determination in the Federal Register. Figure I. Section 232 Investigation Process Investigation requested. Secretary of commerce investigates. Investigation includes consultation with DODS and may include others 270 dlays \ Secretary of Commerce reportsfindings and recommendations tonthe Presdet. ae Pl' aifings wrntse no n~ma~n. r~urhr6 t vr 4 90 days $\President decides whether to accept ifndIngs and recommendations. 7S.days 3Qduys President implements action (if any). President informs Congress. Source: CRS graphic based on 19 U.S.C. § 1862. Prior to the Trump Administration, Commerce initiated 26 Section 232 national security investigations, beginning in 1963. Previous investigations of manufactured goods focused on specific products, including antifriction bearings and gears, and gearing products. Of these 26 cases, Commerce made negative determinations 62% of the time. Prior to 2018, when Commerce made positive determinations, the President took action six times (Figure 2). In one case, the President sought voluntary restraint agreements. Five positive determinations and actions addressed petroleum products or crude oil: one resulted in a conservation fee, later held illegal by a federal court; two actions were based on the Mandatory Oil Import Program that predated enactment of Section 232; and, twice the * .....*.~

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