Major Changes in Steel and Aluminum Tariffs - Grunfeld, Desiderio, Lebowitz, Silverman & Klestadt LLP
The Trump Administration issued Presidential Proclamations on February 10, 2025, under Section 232 of the Trade Expansion Act of 1962, making major changes to U.S. tariff policy on steel and aluminum imports.
Effective March 12, 2025, all steel and aluminum imports covered by the prior Section 232 actions — regardless of origin — will be subject to an additional 25% tariff. Countries that once benefitted from alternative tariff agreements — Australia, Canada, Mexico, South Korea, Brazil, Argentina, the EU, Japan, and the UK — will now face the same treatment as all other exporting countries.
The product exclusion process is being eliminated effective February 11, 2025. As with previous Section 232 tariffs, Foreign Trade Zone (FTZ) processing will not provide a duty advantage, and the section 232 duties will not be eligible for duty drawback. In addition, CBP is directed to strictly enforce perceived misclassifications that avoid the steel and aluminum tariffs.
Below is a breakdown of the key changes.
Tariff Reinstatement and Adjustments
The proclamation reinstates and modifies tariffs on aluminum and steel imports from Argentina, Australia, Brazil, Canada, Mexico, South Korea, the EU, Japan, and the UK. Starting March 12, 2025, steel and aluminum imports from these countries, including the derivatives currently listed in Chapter 99 Notes 16 and 19, will be subject to an additional 25% ad valorem tariff. Previous proclamations that exempted or reduced tariffs for these countries are revoked, meaning all imports of steel and aluminum from every country (except Russia) will now face the same tariff treatment.
Elimination of Product Exclusions
Effective February 11, 2025, the product exclusion process will be terminated, meaning no new exclusions will be granted and any pending applications will be denied. Previously granted exclusions will remain in effect until their expiration date or until the allotted volume is imported — whichever happens first. General Approved Exclusions (GAEs) will continue to be valid until March 12, 2025.
Companies currently importing from exempt countries, or utilizing GAEs, should pay particular attention to ensure that imports arriving close to March 12 obtain a “date of entry for consumption” no later than March 11 in order to avoid liability for the additional 25% duties.
Derivative Aluminum and Derivative Steel
In addition to the “derivative” steel and aluminum articles previously enumerated in Presidential Proclamation 9980 (January 24, 2020), and that are currently identified in HTSUS Chapter 99 Notes 16 and 19 (e.g., steel bumpers), Commerce will identify additional derivative steel and aluminum products that will also become subject to the additional 25% tariffs in a yet to be published Annex. Tariffs on these new derivative products will not become effective until a later date, when the Secretary of Commerce certifies that adequate systems are in place to collect tariff revenues for such products.
The proclamations require Commerce, within 90 days, to establish a process to identify additional derivative products that may become subject to the additional 25% tariffs. This process will also allow U.S. domestic producers to request that Commerce add additional derivative products to the list of products subject to the additional 25% tariffs.
Derivatives produced outside of the United States from steel melted and poured in the U.S., or aluminum smelted and cast in the U.S., will be exempt from the additional 25% duties.
For derivatives classified outside of Chapter 73 or 76, the additional 25% tariff will only apply to the value of the steel or aluminum, not the entire product.
Russian Aluminum and Derivative Aluminum
Imports of derivative aluminum articles containing any primary aluminum smelted or cast in Russia will face an even higher 200% tariff.
Restrictions on FTZ Use
Steel products subject to the additional 25% tariffs admitted into a Foreign Trade Zone (FTZ) on or after March 12, 2025, must be admitted under “privileged foreign status” (19 CFR 146.41) (except articles eligible for admission under “domestic status” as defined by 19 CFR 136.43). The status of products currently in an FTZ under privileged status that are entered for consumption prior to March 12 is unclear.
For aluminum products, the requirement to declare privileged status will not take effect until after the Commerce certification date noted above.
Prohibition of Duty Drawback
As with the existing Section 232 duties on steel and aluminum, drawback will not be available for duties imposed under this proclamation. This means that importers cannot claim refunds on these duties even if the imported aluminum or steel is later exported.
Misclassification Penalties
The proclamations direct CBP to impose maximum monetary penalties for misclassification of steel and aluminum articles and even suggest that CBP is not permitted to mitigate such penalties.
CBP is also required to notify Commerce if CBP believes that steel and aluminum products are being processed in third countries in an improper manner to fall outside the tariff classifications covered by the Section 232 tariffs. Commerce can then consider whether to add such products to the list of covered derivatives. In light of the strong enforcement language, importers and their customs brokers are cautioned to exercise reasonable care before declaring steel or aluminum products under tariff provisions not covered by the Section 232 tariffs. Under this heightened enforcement directive, reasonable care may necessitate obtaining a classification opinion from experienced customs counsel or a CBP binding ruling.
The implementation details under these new proclamations will be set forth in a future Federal Register notice, which will include the Annexes listing new derivative products. Also note that such Federal Register notices may modify the terms of the Proclamations discussed above. These future notices should also provide guidance as to whether duty exemptions under Chapter 98 of the HTSUS will be available.
If your company has questions about the impact of the new tariff regime, including the classification or valuation of products, how to identify potential “derivatives,” or strategies to mitigate the tariffs, please contact one of our attorneys.
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Federal Register Notices:
• Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Raw Honey From Brazil: Notice of Court Decision Not in Harmony With the Final Determination of Antidumping Duty Investigation; Notice of Amended Final Determination; Notice of Amended Antidumping Duty Order
• Certain Corrosion-Resistant Steel Products From Mexico: Preliminary Affirmative Countervailing Duty Determination, and Alignment of Final Determination With Final Antidumping Duty Determination
• Certain Corrosion-Resistant Steel Products From Brazil: Preliminary Affirmative Countervailing Duty Determination, and Alignment of Final Determination With Final Antidumping Duty Determination
• Certain Corrosion-Resistant Steel Products From Canada: Preliminary Affirmative Countervailing Duty Determination and Alignment of Final Determination With Final Antidumping Duty Determination
• Certain Corrosion-Resistant Steel Products From the Socialist Republic of Vietnam: Preliminary Affirmative Countervailing Duty Determination, and Alignment of Final Determination With Antidumping Duty Determination
• Certain New Pneumatic Off-the-Road Tires From India: Amended Final Results of Countervailing Duty Administrative Review; 2022
• Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Certain Frozen Fish Fillets From the Socialist Republic of Vietnam Administrative Review: Notice of Partial Rescission; 2023-2024
• Steel Wire Garment Hangers From the People's Republic of China: Continuation of Antidumping Duty Order
• Temporary Steel Fencing From the People's Republic of China: Initiation of Countervailing Duty Investigation
• Glycine From Japan: Notice of Amended Final Results of Antidumping Duty Administrative Review Pursuant to Settlement; 2018-2020
• Sales at Less Than Fair Value; Determinations, Investigations, etc.: Utility Scale Wind Towers From Spain: Notice of Court Decision Not in Harmony With the Final Determination of Less-Than-Fair-Value Investigation; Notice of Amended Final Determination; and Notice of Amended Antidumping Duty Order
• Temporary Steel Fencing From the People's Republic of China: Initiation of Less-Than-Fair-Value Investigation
• Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Low Speed Personal Transportation Vehicles (LSPTVs) From China; Scheduling of the Final Phase of Countervailing Duty and Antidumping Duty Investigations
• Large Top-Mount Combination Refrigerator-Freezers From Thailand; Scheduling of the Final Phase of an Antidumping Duty Investigation
• Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Agreement Suspending the Antidumping Duty Investigation on Lemon Juice From Argentina: Rescission of 2022-2023 and 2023-2024 Administrative Reviews
• Sodium Nitrite From the Federal Republic of Germany and the People's Republic of China: Continuation of Antidumping Duty Orders
• Mattresses From Serbia: Rescission of Antidumping Duty Administrative Review; 2023-2024
• Melamine From India: Final Affirmative Countervailing Duty Determination and Critical Circumstances Determination
• Investigations; Determinations, Modifications, and Rulings, etc.: Hot-Rolled Steel Products From China, India, Indonesia, Taiwan, Thailand, and Ukraine; Scheduling of Full Five-Year Reviews
• Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Certain Corrosion-Resistant Steel Products From the Republic of Korea: Notice of Court Decision Not in Harmony With the Results of Countervailing Duty Review; Notice of Amended Final Results
• Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Advance Notification of Sunset Review; Correction
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Cincinnati CBP Stops Deadly Chemical Compound - U.S. Customs & Border Protection
CINCINNATI – U.S. Customs and Border Protection (CBP) officers at the port of Cincinnati seized two shipments on February 7 containing the deadly, addictive, and illegal substance tianeptine. Officers seized the 9 pounds for violation of the Federal Food, Drug, and Cosmetic Act (FD&C Act).
Tianeptine is an unapproved drug in the U.S. Although other countries have approved tianeptine, corporations are making dangerous and unproven claims that tianeptine can improve brain function and treat anxiety, depression, pain, opioid use disorder, and other conditions.
Additionally, the Food and Drug Administration (FDA) has identified cases in which people experienced other serious harmful effects from abusing or misusing tianeptine by itself or with other drugs, including antidepressants and anti-anxiety medicines. These effects included agitation, drowsiness, confusion, sweating, rapid heartbeat, high blood pressure, nausea, vomiting, slowed or stopped breathing, coma, and death.
Although the FDA has warned consumers about tianeptine, vendors continue to market and sell this drug. The FDA is aware tianeptine has been sold online, typically in tablet or powder form.
Both shipments originated from the same manufacturer in Hong Kong and were both headed to the same residence in Lubbock, Texas. The domestic value of this drug is over $209,000 and is part of an ongoing investigation.
“Our officers are exceptional at what they do and are part of the best frontline defense in the world,” said LaFonda D. Sutton-Burke, Director, Field Operations-Chicago Field Office. “The interception of this chemical compound is definitely significant as it prevented dangerous drugs from entering our communities and possibly causing harm to innocent people.”
CBP conducts operations at ports of entry throughout the United States, and regularly screens arriving international passengers and cargo for narcotics, weapons, and other restricted or prohibited products. CBP strives to serve as the premier law enforcement agency enhancing the Nation’s safety, security, and prosperity through collaboration, innovation, and integration.
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How To Organize Your Important Papers Before a Disaster Strikes - Federal Trade Commission - Consumers
When it comes to preparing for weather emergencies or other disasters, financial readiness is as important as a flashlight with fully charged batteries. Leaving your home can be stressful but knowing that your personal and financial documents are up to date, in one place, and easy to find can make a big difference. Here’s how to organize important papers before a disaster strikes.
Do a Household Inventory
Make a list and take pictures or videos of what you own. This can help if you have to file insurance claims. Even if you save your list and pictures on a device, print out copies, too. Also gather important documents and information, like
• Social Security cards, health insurance cards, and a list of current prescriptions
• insurance policy numbers and contact information at those companies
• copies of important financial and family records, including deeds, titles, wills, birth and adoption certificates, marriage certificates, passports, military records, and employee benefit and retirement documents. NOTE: Except for wills, keep original records in a safe deposit box or at some other secure location. If you have a will, ask your attorney to keep the original.
• ownership records for your home, cars, RVs, or boats
• a list of bank, loan, credit card, mortgage, debit, and investment account numbers, and contact information for each institution
• backups of the financial information you keep on your computer
• information on your pets, like medical, prescription, and vaccination records, along with current photos and ID chip numbers, in case you’re separated
Keep It in a Safe and Convenient Place
Keep your information safe. Here are some options:
• Use a lockable, fireproof file box. Put important documents in the box, and keep it in a secure, handy place in your home so you can “grab it and go.” Include some cash, since ATMs or banks may be closed, an extra set of keys for your house and car, and the key to your safe deposit box, if you have one.
• Rent a safe deposit box. A safe deposit box can protect documents that are hard to replace, but that you don’t need to use very often.
• Take advantage of technology. It can protect important documents while making it easier to get access in an emergency or when you need to update them.
• Online bill-pay. Paying your bills online lets you stay current, even if you can’t get mail and don’t have your checkbook. Contact your bank for more information.
• Personal cloud storage. Online storage is available for free with many email accounts. Use your space to upload PDFs of important documents you’ve scanned. Make sure access requires a strong password and multifactor authentication.
• Virtual safe deposit boxes. Some banks offer this online service to protect documents, photos, and videos. Make sure the data is protected with a strong password and/or multifactor authentication.
• USB flash drives. Also known as a thumb drive, these portable hard drives offer a lot of storage space in a small package. Copy your important computer files onto the flash drive and keep it with you. You might also want to keep a copy in your safe deposit box or with a friend or relative. Be sure to password protect your flash drive, in case you lose it.
• Online password manager. Websites and software let you store your usernames and passwords. You have to remember only one master password to access the list.
Update Your Information
Review the contents of your household inventory, fireproof box, and safe deposit boxes, as well as your online and digital storage, at least once a year. Make sure everything is up to date.
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United States, Australia, and the United Kingdom Jointly Sanction Key Infrastructure that Enables Ransomware Attacks - Department of Treasury
WASHINGTON — Today, the Department of the Treasury’s Office of Foreign Assets Control (OFAC), Australia’s Department of Foreign Affairs and Trade, and the United Kingdom’s Foreign Commonwealth and Development Office are jointly designating Zservers, a Russia-based bulletproof hosting (BPH) services provider, for its role in supporting LockBit ransomware attacks. LockBit, a Russia-based ransomware group best known for its ransomware variant of the same name, is one of the most deployed ransomware variants and was responsible for the November 2023 attack against the Industrial Commercial Bank of China U.S. broker-dealer. BPH service providers sell access to specialized servers and other computer infrastructure designed to evade detection and defy law enforcement attempts to disrupt these malicious activities. OFAC is also designating two Russian nationals who are key administrators of Zservers and have enabled ransomware attacks and other criminal activity.
“Ransomware actors and other cybercriminals rely on third-party network service providers like Zservers to enable their attacks on U.S. and international critical infrastructure,” said Acting Under Secretary of the Treasury for Terrorism and Financial Intelligence Bradley T. Smith. “Today’s trilateral action with Australia and the United Kingdom underscores our collective resolve to disrupt all aspects of this criminal ecosystem, wherever located, to protect our national security.”
This action builds on last year’s trilateral cyber sanctions with Australia and the United Kingdom against Russian ransomware actor Alexander Ermakov and members of the Evil Corp ransomware group. It also reflects a shared commitment to combatting cybercrime and degrading the support networks that enable bad actors to target victims in the United States and in allied countries. This action was developed with the support of the Department of Justice and the Federal Bureau of Investigation.
ZSERVERS: A RUSSIAN BULLETPROOF HOSTING SERVICES PROVIDER SUPPORTING RANSOMWARE AND CYBERCRIME
Zservers, headquartered in Barnaul, Russia, has advertised BPH services on known cybercriminal forums to evade law enforcement investigations and takedowns, as well as scrutiny from cybersecurity firms. Zservers has provided BPH services, including leasing numerous IP addresses, to LockBit affiliates, who have used the hosting services to coordinate and launch ransomware attacks. During a 2022 search of a known LockBit affiliate, Canadian law enforcement uncovered a laptop operating a virtual machine that was connected to a Zservers’ subleased IP address and running a programming interface used to operate LockBit malware. In 2022, a Russian cybercriminal purchased IP addresses from Zservers, almost certainly for use as Lockbit chat servers to discuss ransomware operations. In 2023, Zservers leased infrastructure, including a Russian IP address, to a Lockbit affiliate.
OFAC is designating Zservers pursuant to Executive Order (E.O.) 13694, as further amended by E.O. 14144, for having materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of, LockBit ransomware, a cyber-enabled activity originating from, or directed by persons located, in whole or substantial part, outside the United States that is reasonably likely to result in, or has materially contributed to, a threat to the national security, foreign policy, or economic health or financial stability of the United States and that has the purpose of or involves causing a misappropriation of funds or economic resources, intellectual property, proprietary or business confidential information, personal identifiers, or financial information for commercial or competitive advantage or private financial gain.
KEY ZSERVERS PERSONNEL
Alexander Igorevich Mishin (Mishin) is a Russian national and administrator of Zservers. Mishin has marketed Zservers’ BPH services to cybercriminals, including LockBit affiliates and other ransomware groups, with the understanding that they would use those services in their cybercriminal activities. He has also directed virtual currency transactions to be made in support of those activities.
Aleksandr Sergeyevich Bolshakov (Bolshakov) is a Russian national and administrator of Zservers. In 2023, Bolshakov and Mishin shut down an IP address in response to a complaint from a Lebanese company alleging that a Zservers-associated IP address had implemented Lockbit in a ransomware attack. Zservers likely enabled ransomware attacks to continue by assigning a new IP address to the malicious Lockbit user. Mishin instructed Bolshakov to change the IP address of the malicious user and then told the Lebanese company that the original IP address was cut off.
OFAC is designating Mishin and Bolshakov pursuant to E.O. 13694, as further amended by E.O. 14144, for being owned or controlled by, or having acted or purported to act for or on behalf of, directly or indirectly, Zservers, a person whose property and interests in property are blocked pursuant to E.O. 13694, as further amended by E.O. 14144.
SANCTIONS IMPLICATIONS
As a result of today’s action, all property and interests in property of the blocked persons described above that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC. In addition, any entities that are owned, directly or indirectly, individually or in the aggregate, 50 percent or more by one or more blocked persons are also blocked. Unless authorized by a general or specific license issued by OFAC, or exempt, OFAC’s regulations generally prohibit all transactions by U.S. persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons.
In addition, financial institutions and other persons that engage in certain transactions or activities with the sanctioned entities and individuals may expose themselves to sanctions or be subject to an enforcement action. The prohibitions include the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any designated person, or the receipt of any contribution or provision of funds, goods, or services from any such person.
Violations of OFAC regulations may result in civil or criminal penalties. OFAC’s Economic Sanctions Enforcement Guidelines provide more information regarding OFAC’s enforcement of U.S. sanctions, including the factors that OFAC generally considers when determining an appropriate response to an apparent violation.
The power and integrity of OFAC sanctions derive not only from OFAC’s ability to designate and add persons to the SDN List, but also from its willingness to remove persons from the SDN List consistent with the law. The ultimate goal of sanctions is not to punish, but to bring about a positive change in behavior. For information concerning the process for seeking removal from an OFAC list, including the SDN List, please refer to OFAC’s Frequently Asked Question 897 here. For detailed information on the process to submit a request for removal from an OFAC sanctions list, please click here.
Click here for more information on the individuals and entities designated or otherwise blocked today.