Senate Finance Committee Leaders Say Section 232 Product Exclusion Process Is Broken

The way that companies can apply for product exclusions is procedurally unfair, and there are no mechanisms to prevent the product exclusion process from enabling anti-competitive advantages, Sens. Orrin Hatch and Ron Wyden wrote on April 19. Hatch, chairman of the Senate Finance Committee, and Wyden, ranking member, said that the application forms require "a minute level of detail," including the chemical compositions, dimensions, strength, toughness, ductility, magnetic permeability, surface finish and coatings of the products. Domestic manufacturers objecting to a request have to respond in similar detail.

The senators said that while the interim final rule allows the Department of Commerce to extend a product exclusion to other importers beyond the requester, the department has not said how it will decide to do so. They also said the process is not fair because Commerce has not said how parties will be able to address ex parte communications Commerce has with other parties in a proceeding. "By our count, the forms collect information on more than 70 attributes of each steel or aluminum product, with an additional form apparently required in every instance in which a single attribute differs between products. By design, this process increases the burden on businesses that purchase or produce products with even minor variations," they wrote.

Commerce has not said how it will inform requestors and objectors that it has issued a determination, whether it will give the reasons for its rejection or acceptance, nor how it will "ensure it issues consistent determinations across similarly situated petitioners and objectors."

The senators also complained that exclusions are only retroactive to when the request was published or posted. As of April 18, there have been more than 3,800 product requests, and fewer than 100 have been posted, the lawmakers said. They asked for a response within two weeks with plans on how to address their concerns. The Commerce Department didn't immediately respond.