No New Tariffs on French Goods, USTR Says

New 25% percent tariffs on goods from France that were to begin Jan. 6 are suspended, the Office of the U.S. Trade Representative said in a news release Jan. 7. The tariffs were planned as a result of France's digital services tax and the suspension will allow the agency to complete investigations into other countries' DSTs. “Given that these DST investigations are ongoing and have not yet reached any determinations on what, if any, trade action should be taken, the U.S. Trade Representative has determined that it is appropriate to suspend the action in the France DST investigation indefinitely,” it said in a notice. The announcement follows days of confusion over whether the Jan. 6 tariffs were being implemented (see 2101060047).

The ITC had late on Jan. 6 moved to implement the new duties in the tariff schedule (see 2101070006), adding new subheading 9903.90.01 and U.S. Note 22. As of press time the ITC had not removed the tariff provisions to reflect USTR’s reversal. A CBP spokesman said no additional duties were collected on French goods imported between the time the tariffs were supposed to take effect and when USTR announced they wouldn't.

Beth Hughes, vice president, Trade and Customs Policy, at the American Apparel and Footwear Association, said the trade group is pleased with the development: “The selection of handbags for retaliation had nothing to do with this tax, or even with digital services. Retaliation against these products, if implemented, will have a significant impact on our industry, and our American workers. The trade by tariff approach over the past four years has been filled with contradictions and lack of communication that has sowed paralyzing uncertainty into the business community.”