On Monday and Tuesday this week, the Office of the U.S. Trade Representative (USTR) proposed significant new tariffs on imports from 60 U.S. trading partners: a 12.5% tariff on 45 economies, a 10% tariff on 14 economies, and a 37.5% tariff on one economy (Brazil).  USTR proposed the bulk of these tariffs as a remedy to address the trade practices of the 60 economies related to the importation of goods produced with forced labor, which USTR is investigating under Section 301 of the Trade Act of 1974.  In addition, USTR proposed a 37.5% tariff for Brazil, combining a 12.5% tariff related to forced labor and a 25% tariff as part of a separate Section 301 investigation targeting a wide range of Brazil’s trade practices.  All these proposed tariffs are subject to significant exceptions.  

The proposed tariffs are not final.  Any interested parties, including U.S. and international firms, trade associations, and individuals, will have the opportunity to submit written comments and testify at upcoming public hearings regarding the specific products subject to the tariffs and the proposed tariff rates.  This public consultation process is a critical tool for stakeholders to influence the scope of these remedies.

Additional tariff announcements are expected this week or next.  In particular, USTR is expected to propose tariffs as part of another series of Section 301 investigations – these targeting 16 economies’ trade practices related to structural excess capacity.  We will update this client alert with information regarding any such announcement. 

Additional Section 301 investigations are also expected.  Notably, after the Supreme Court struck down the IEEPA tariffs in February, Ambassador Greer foreshadowed numerous potential investigations covering a range of sectors, including pharmaceuticals, digital goods and services, and agriculture.  Such investigations could lead to further tariffs or other remedies. 

Background

Section 302(b) of the Trade Act of 1974 empowers USTR to launch an investigation under Section 301(b) to determine whether an act, policy, or practice of a foreign country is “unreasonable or discriminatory” and “burdens or restricts United States commerce.”  If USTR determines as the result of an investigation that the statutory criteria are met, it may impose a wide range of remedies, including, but not limited to, duties or other import restrictions on goods of the foreign country.

On July 15, 2025, USTR launched a Section 301 investigation focusing on a wide range of Brazil’s trade practices, including those related to digital trade and electronic payment services; unfair, preferential tariffs; anti-corruption enforcement; intellectual property protection; ethanol market access; and illegal deforestation. 

On March 11 and March 12 of this year, USTR launched two sets of Section 301 investigations focusing, respectively, on the trade practices of 16 economies related to structural excess capacity and production in manufacturing sectors, and the trade practices of 60 economies related to the importation of goods produced with forced labor.  It is widely believed that these investigations are intended to reestablish tariff levels consistent with the IEEPA tariffs that the Supreme Court struck down in February.  After the Supreme Court decision, President Trump imposed a 10% global tariff pursuant to Section 122 of the Trade Act of 1974.  However, the Court of International Trade decided on May 7 that this tariff is unlawful, and regardless of the outcome of the pending appeal, this tariff will expire after 150 days, on July 24 (barring extension by Congress, which would be extremely unlikely). 

Forced Labor Section 301 Investigation

On June 2, USTR issued a notice of determinations and proposed actions and a report supporting its findings in the Section 301 investigations into the acts, policies, and practices of 60 economies related to the failure to impose and effectively enforce bans on imports made with forced labor.

In the investigations, USTR determined that all 60 economies have failed to impose and effectively enforce a forced labor import ban, which USTR determined is actionable under Section 301.  Specifically, USTR determined that this practice is “unreasonable” because it “(1) undermines the universal aim of eliminating forced labor; (2) permits firms that avail themselves of forced labor to produce goods at lower cost and thereby distort market conditions for firms that do not use forced labor; (3) undermines the profitability of firms that do not use forced labor; and (4) contributes to the circumvention of existing forced labor import prohibitions.”  Further, USTR determined that this practice “burdens or restricts U.S. commerce” by “subjecting U.S. producers to unfair competition from forced labor goods both in export markets and the U.S. market, and by displacing foreign goods produced without forced labor or forced labor inputs into the United States and other markets.”

Based on these determinations, USTR proposed the following tariffs:

• A 10% tariff on 14 economies¹ that had imposed a forced labor ban, undertaken commitments in Agreements on Reciprocal Trade regarding forced labor import prohibitions, or imposed a partial regime with the effect of preventing the importation of certain forced labor goods
• A 12.5% tariff on the other 46 economies²

The proposed action exempts numerous products from these tariffs:

• Articles identified in Annex A, including:
  • Articles and parts subject to Section 232 tariffs
  • Raw materials that if subject to the proposed additional tariffs could lead to the unavailability of domestic supply
  • Products that could cause economy-wide disruptions if subject to the proposed additional tariffs
  • Certain products that cannot be grown or produced in sufficient quantities in the United States or obtained from other sources.
• Informational materials, e.g., books, donations, and accompanied baggage
• Articles for which additional tariffs may not contribute substantially to the elimination of the investigated acts, policies, and practices related to forced labor
• USMCA-originating goods of Canada and Mexico
• Textiles and apparel articles that are subject to duty-free treatment as a good of Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, or Nicaragua under CAFTA-DR

Additionally, USTR proposed a textile mechanism that would impose a reduced Section 301 tariff on a certain volume of apparel and textile imports.  Under this mechanism, the volume of apparel and textile imports subject to the reduced tariff would be equal to the “quantity of exports of textiles (e.g., U.S. produced man-made and cotton fiber textile inputs) from the United States to that trading partner” and based on “the volume of U.S. cotton and cotton products a trading partner imports from the United States during a certain amount of time.”

USTR will accept written comments on the proposed actions by July 6, via this website.  USTR invites comments regarding the following issues:

• The specific products to be subject to increased duties, including whether products should be retained or removed from the scope of the action, or whether products currently listed in Annex A should be added to the scope of the action
• Whether products listed in Annex A are appropriately excluded
• The level of the increase, if any, in the rate of duty
• Whether different tariff rates should be applied to an economy that has made a commitment to the United States to impose and enforce a forced labor import prohibition, has imposed a forced labor import prohibition, or has imposed a partial regime with the effect of preventing the importation of certain forced labor goods.
• Features of a textile mechanism, including the U.S. and foreign products to be covered, the relative market opportunities for each side, and the tariff rate (if any) to be applied to products subject to that mechanism, as well as whether a similar mechanism should apply to any other product or sector.

Additionally, USTR will hold public hearings in the main hearing room of the International Trade Commission starting at 10 a.m. ET on July 7. 

Brazil Section 301 Investigation

On June 1, USTR issued a notice of determination and proposed action as part of the Section 301 investigation into Brazil’s acts, policies, and practices related to six issues – digital trade and electronic payment services; unfair, preferential tariffs; anti-corruption enforcement; intellectual property protection; ethanol market access; and illegal deforestation.

USTR determined that Brazil’s trade practices in all six areas are actionable under Section 301.  The specific trade practices that USTR determined are “unreasonable or discriminatory” and “burden or restrict U.S. commerce” include Brazilian courts’ issuance of secret orders forcing U.S. social media companies to remove content; preferential treatment of Pix, a payment system established by the Brazilian central bank, over U.S. electronic payment services providers; preferential tariffs for certain Mexican and Indian imports; insufficient anti-corruption enforcement actions; failure to sufficiently address counterfeiting, patent pendency, and piracy; nonreciprocal and unfair tariff treatment of ethanol; and failure to enforce domestic deforestation laws.

Based on these determinations, USTR proposed a 25% Section 301 tariff on imports of Brazil (in addition to the 12.5% tariff as part of the forced labor investigation), with exemptions for the following products:

• Products identified in the Annex, including:
  • Raw materials that if subject to the proposed tariffs could lead to unavailability of domestic supply
  • Products that could cause economy-wide disruption if subject to the proposed additional tariffs
  • Products that cannot be grown or produced in sufficient quantities in the United States or obtained from other sources
  • Articles for which additional tariffs may not contribute substantially to the elimination of Brazil’s acts, policies, and practices covered by the Section 301 investigation
• Informational materials, donations, and accompanied baggage
• All articles and parts of articles subject to Section 232 tariffs

USTR will accept written comments on the proposed actions by July 1, via this website.  Additionally, USTR will hold public hearings in the main hearing room of the International Trade Commission on July 6. 

Conclusion

The Trump Administration is actively using Section 301 investigations to advance its trade policy and tariff agenda.  In addition to the actions discussed above, on May 29, USTR launched a Section 301 investigation of Vietnam’s acts, policies, and practices related to intellectual property protection and enforcement.  Other Section 301 investigations are expected.  Indeed, Ambassador Greer has indicated that he would support Section 301 investigations targeting additional issues, such as pharmaceutical pricing practices, discrimination against U.S. technology companies and digital goods and services, digital services taxes, ocean pollution, and practices related to the trade in seafood, rice, and other products. 

WilmerHale is well-positioned to guide clients through these investigations.  For example, we have considerable experience helping clients participate in the public consultations processes and taking other steps to advocate for their interests.  We also can help clients manage tariff exposure.  We stand ready to assist.