As global economic and geopolitical environments enter a new era, companies need to continuously develop and adjust their coherent global business strategies to secure and further expand business opportunities in all markets while minimizing political and legal risks by ensuring compliance. To assist you with that task, Mayer Brown’s US-China Trade Monthly provides news and insights related to the latest US developments impacting the US-China bilateral trade relationship.

In this first issue of 2024, we will discuss: (1) USTR’s extension of reinstated exclusions; (2) the House Foreign Affairs Committee Chairman releasing the 90-Day Review Report of BIS; and (3) the US Department of Commerce announcing an upcoming survey on the US semiconductor supply chain and national defense industrial base.

USTR Further Extends 352 Reinstated Exclusions and 77 COVID-Related Exclusions

On December 26, 2023, the Office of the United States Trade Representative (USTR) announced a further extension of 429 product-specific exclusions from the China Section 301 Tariffs through May 31, 2023. The USTR first reinstated 352 exclusions in March 2022 through year-end 2022, and then in December 2022 through September 30, 2023. Several months later, in May 2023, the USTR decided to also extend 77 COVID-related exclusions through September 30, 2023. Most recently, in September 2023, the USTR extended both the reinstated and COVID-related exclusions through December 31, 2023, to allow for consideration under its four-year review of the List 1 and List Section 301 tariffs. 

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House Foreign Affairs Committee Chairman Releases Report on 90-Day Review of BIS and Emphasizes Need to Overhaul and Modernize US Export Control Restrictions Targeting China

On December 7, 2023, the US House of Representatives’ Foreign Affairs Committee Chairman, Michael McCaul (R-TX10), released a 90-Day Review Report (“the Report”) on the US Department of Commerce’s Bureau of Industry & Security (“BIS”), the US agency with lead regulatory authority for most commercial and dual-use exports and technology transfers. Chairman McCaul has been an outspoken advocate for increased oversight of BIS and for enhanced US export controls on China. McCaul’s Report is principally focused on BIS’s role in regulating the flow of sensitive goods and technology to China and concludes that a number of specific recommended measures are needed to help stem the “flow of American technology to [Chinese Communist Party]-controlled companies.”

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US Department of Commerce Announces Industrial Base Survey of American Semiconductor
Supply Chain

On December 21, 2023, the US Department of Commerce (DOC) announced it will launch a new survey in January 2024 to serve as a foundation for continued analysis of the capabilities and challenges of the broader US semiconductor supply chain and national defense industrial base. The survey intends to identify how US companies are sourcing older generations of semiconductors (known as mature-node or legacy chips) to “inform US policy to bolster the semiconductor supply chain, promote a level playing field for legacy chip production, and reduce national security risks posed by the People’s Republic of China (PRC).”

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