New Section 301 Tariffs Addressing Forced-Labor Import Policies Take Effect July 24, 2026

On July 23, 2026, the U.S. Trade Representative (“USTR”) announced its determination of the Section 301 investigations regarding prohibition of forced labor. The USTR found that the 60 economies involved failed in some capacity to either impose or enforce prohibitions on forced labor-produced goods. Under Section 301 of the Trade Act of 1974, the USTR has imposed tariffs on most imports from the 60 economies. The additional duties, generally 10% or 12.5%, take effect for covered merchandise entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. Eastern Time on July 24, 2026.

Unless specifically exempted, the tariffs apply broadly to products of each covered economy rather than to particular industries or tariff classifications.

Background

On June 2, 2026, the USTR determined that the acts, policies, and practices of 60 economies relating to imports produced with forced labor were unreasonable and burdened or restricted U.S. commerce, making them actionable under Section 301.

The USTR found that 54 economies had failed to impose and effectively enforce prohibitions on imports produced with forced labor. While Canada, Ecuador, the European Union, Indonesia, Mexico, and Pakistan had adopted such prohibitions, they failed to enforce them effectively. Following these initial determinations, several economies adopted new prohibitions or made commitments to restrict the use of forced labor to product goods.

Tariff Treatment Beginning July 24

10% Additional Section 301 Duty

A 10% additional Section 301 duty applies to covered goods from:

Argentina, Bangladesh, Cambodia, Canada, Ecuador, El Salvador, Guatemala, Honduras, India, Indonesia, Jordan, Malaysia, Mexico, Pakistan, Sri Lanka, Trinidad and Tobago, and the United Kingdom.

The USTR assigned the 10% rate to economies that have imposed a forced-labor import prohibition, committed to impose and enforce such a prohibition through an Agreement on Reciprocal Trade (“ART”) deal, or imposed a partial regime that prevents the importation of certain forced-labor goods.

European Union and Taiwan

For a covered product from the European Union or Taiwan:

• Where the product’s most-favored-nation (“MFN”) duty rate is less than 10%, an additional Section 301 duty applies in an amount sufficient to bring the sum of the MFN duty and the Section 301 duty to 10%.
• Where the product’s MFN duty rate is 10% or greater, the Section 301 duty under this action is zero.

This treatment applies only to products that are not otherwise exempt from the action.

Japan, South Korea, and Switzerland

For a covered product from Japan, South Korea, or Switzerland:

• Where the product’s MFN duty rate is less than 12.5%, an additional Section 301 duty applies in an amount sufficient to bring the sum of the MFN duty and the Section 301 duty to 12.5%.
• Where the product’s MFN duty rate is 12.5% or greater, the Section 301 duty under this action is zero.

This treatment also applies only to products that are not otherwise exempt from the action.

Other Investigated Economies

Covered goods of all other investigated economies are subject to a 12.5% Section 301 duty, unless the goods qualify for an applicable product exemption.

Limited In-Transit Exception

The Section 301 duties do not apply to goods that:

• were loaded onto a vessel at the port of loading and were in transit on the final mode of transit before 12:01 a.m. Eastern Time on July 24, 2026
• are entered for consumption, or withdrawn from warehouse for consumption, before 12:01 a.m. Eastern Time on July 28, 2026

The exception is therefore based on both the shipment’s loading and transit status and the date on which the goods are entered for consumption or withdrawn from warehouse. Arrival in the United States by July 28 is not the operative requirement.

Product Exemptions

The Federal Register notice establishes general and economy-specific product exemptions through modifications to the HTSUS. Exempt products include:

• informational materials, donations, and accompanied baggage
• articles and parts of articles subject to Section 232 tariffs
• product exemptions identified in Annexes I and II of the Federal Register notice

The product exemptions include certain:

• 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
• products, that if exempted from these tariffs, would encourage economies to enact and effectively enforce a forced labor import prohibition
• articles for which additional tariffs may not contribute substantially to the elimination of the acts, policies, and practices determined to be actionable in the investigations

Because the exemptions are defined through specific HTSUS provisions (and in some instances, economy-specific annexes), importers should review the applicable tariff classifications and annex provisions rather than rely solely on general product descriptions.

Immediate Steps for Importers

Importers should work with counsel to promptly:

• identify merchandise whose country of origin is one of the 60 covered economies
• determine whether the merchandise is subject to a 10% additional duty, a 12.5% additional duty, or an MFN-based duty cap
• review Annexes I and II and the applicable HTSUS provisions to determine whether a product exemption applies
• determine whether shipments qualify for the narrow in-transit exception
• confirm the applicable Chapter 99 classification and entry-reporting requirements
• identify products already subject to Section 232 tariffs and therefore excluded from this Section 301 action
• review foreign-trade zone admission procedures for covered merchandise
• monitor future USTR announcements establishing tariff-rate quotas for certain textile and apparel products from Bangladesh, Cambodia, Indonesia, and Malaysia, which USTR has indicated it will implement through a subsequent Federal Register notice
• coordinate with customs brokers and internal compliance personnel to ensure that entries filed beginning July 24 reflect the correct tariff treatment.

The final Federal Register notice, its HTSUS modifications, and Annexes I and II, together with any subsequent CBP implementation guidance, govern the application of these duties to individual entries.

Contact Clark Hill

If you have questions regarding the content of this alert, please contact any member of Clark Hill’s International Trade Practice:

• Mark Ludwikowski (mludwikowski@clarkhill.com; 202.640.6680)
• Kevin Williams (kwilliams@clarkhill.com; 312.985.5907)
• Kelsey Christensen(kchristensen@clarkhill.com; 202.230.9889)
• Aristeo Lopez (alopez@clarkhill.com; 202.552.2366)
• Ashley Gifford (agifford@clarkhill.com; 202.640.6655)
• Laura M. Quesada(Lquesada@clarkhill.com; 202.240.0170)
• Amal Sheheen (asheheen@clarkhill.com; 202.552.2354)
• Onjoly Purification (Opurification@clarkhill.com; 202.552.2361)

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