WEBVTT - Joyce Adetutu on Tariff Risks, Refunds

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<v Speaker 1>Welcome to the Votes and Verdicts podcast hosted by Bloomberg Intelligence,

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<v Speaker 1>the investment research arm of Bloomberg LP. In this podcast series,

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<v Speaker 1>we talk about the intersection of business policy and law.

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<v Speaker 1>My name is Holly Frome. I'm an analyst with Bloomberg

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<v Speaker 1>Intelligence covering consumer and industrials litigation. Today's podcast will focus

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<v Speaker 1>on the area of terraffs. I'm delighted to be joined

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<v Speaker 1>today by Joyce Attitude. Miss Attitude is a partner at

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<v Speaker 1>Vincent and Elkins in Houston. She's focused on cross border

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<v Speaker 1>trade including import laws, tariffs, trade sanctions, and export controls.

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<v Speaker 1>She has council clients seeking help with customs questions, including

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<v Speaker 1>assisting with questions related to product classification under the Harmonized

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<v Speaker 1>Terror Schedule and questions related to imports involving the Customs

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<v Speaker 1>and Border Protection Agency. She's been on this podcast several times.

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<v Speaker 1>I'm some were grateful to have her here again. Thank

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<v Speaker 1>you so much, Joyce for joining us again. So glad

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<v Speaker 1>to be here, Hallie, thank you for having me so Joyce.

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<v Speaker 1>Can you describe your background and what types of issues

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<v Speaker 1>you've helped your clients navigate?

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<v Speaker 2>Absolutely so. I am a partner at Benson and Olkins.

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<v Speaker 2>I focus my practice on sanctions, export controls, and customs,

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<v Speaker 2>particularly in the tariff space. I mean, we cover pretty

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<v Speaker 2>much everything in the important tariff sector, I guess. So

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<v Speaker 2>we do all things from classifying products for the correct

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<v Speaker 2>HTS code, wondering if for importers that are wondering if

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<v Speaker 2>they can get a tariff, we actually go through the

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<v Speaker 2>process of determining whether they have a teriff liability. We

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<v Speaker 2>do everything from FTZ to tariff free funds. Really a

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<v Speaker 2>lot in the custom space.

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<v Speaker 1>Interesting so, as many of our listeners know, last year,

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<v Speaker 1>President Trump and posed so called reciprocal tariffs on a

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<v Speaker 1>number of nations to address trade deficits on tariffs on China, Canada,

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<v Speaker 1>and Mexico to address the fentanel crisis at the border.

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<v Speaker 1>He did this using a statute called the International Emergency

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<v Speaker 1>Economic Powers Act or IEPA, which allows a president to

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<v Speaker 1>regulate imports to address an unusual and extraordinary threat to

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<v Speaker 1>the national security, foreign policy, or economy of the United States.

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<v Speaker 1>The Supreme Court in February found those tariffs unlawful, and

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<v Speaker 1>the lower court, the International Trade Court, ordered that all

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<v Speaker 1>i EPA tariffs that have been paid be refunded. So

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<v Speaker 1>as aep A refund refunds, I understand that they began

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<v Speaker 1>May eleventh. Can you tell us what this process looks

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<v Speaker 1>like for a company seeking refunds and what is the

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<v Speaker 1>status of refunds.

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<v Speaker 2>So right now, if a company is looking to recover

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<v Speaker 2>a refund for i eap the tariffs that were paid,

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<v Speaker 2>there's an entire process that Customs and Border Protection has

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<v Speaker 2>designed called the CAPE process, where an importer can file

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<v Speaker 2>what's called declaration and that basically includes all of their

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<v Speaker 2>AEPA tariffs that were paid on a particular entry and

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<v Speaker 2>they put it in a Customs designed form and then

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<v Speaker 2>submit it through this CAPE portal. Right now, we're in

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<v Speaker 2>Phase one of the CAPE portal, So there's only certain

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<v Speaker 2>tariff entries that qualify for Phase one. Those would be

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<v Speaker 2>tariff entries that have liquidated, but not that are past

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<v Speaker 2>one hundred or that are past eighty days past liquidation.

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<v Speaker 2>Other tariffs that are either being protested or have a

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<v Speaker 2>more complicated tariff structure, like you know, including anti dumping

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<v Speaker 2>or countervailing duties, those can't be submitted in Phase one

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<v Speaker 2>at this point. But once an importer has submitted their declaration,

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<v Speaker 2>the CAP Portal goes through the process of determining whether

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<v Speaker 2>the declaration is actually valid and then will process those

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<v Speaker 2>entries to determine whether aniep A refund is appropriate. So

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<v Speaker 2>it will basically liquidate or re liquidate any entries that

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<v Speaker 2>were subject to an IPA tariff and remove the aepateriff

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<v Speaker 2>and then Customs in Border Protection reviews what the CAP

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<v Speaker 2>Portal has processed and will issue a refund once the

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<v Speaker 2>once the declaration has been approved and gone through the

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<v Speaker 2>CAP Portal. It's quite a process right now, and like

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<v Speaker 2>I said, we're in phase one, so presumably there will

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<v Speaker 2>be a phase two and potentially a phase three where

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<v Speaker 2>those more complicated entries and some of the later entries

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<v Speaker 2>will be able to be submitted. So when you.

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<v Speaker 1>Say that the CAPE Portal will validate the declarations, is

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<v Speaker 1>that an automated Is that an automated process? Where are

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<v Speaker 1>there actually people who are doing that?

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<v Speaker 2>So according to Customs, the CAKE Portal does the sort

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<v Speaker 2>of initial review and validates the declaration. So once it's submitted,

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<v Speaker 2>the KATE Portal itself will re liquidate the entries and

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<v Speaker 2>take out those i EPA tears tariffs. So that now

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<v Speaker 2>when Customs does the final liquidation, there are no IPA

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<v Speaker 2>tariffs included on the entry, and then the refund is

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<v Speaker 2>to turn in. There is a portion of the process

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<v Speaker 2>where Customs has the ability to review, and that's the

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<v Speaker 2>part of the process that we take a little bit

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<v Speaker 2>longer for Customs to basically confirm that what happened within

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<v Speaker 2>the CAPE portal was correct. Got it.

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<v Speaker 1>So you mentioned earlier in a conversation that we were

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<v Speaker 1>having that some industry folks are exploring the idea of

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<v Speaker 1>credits rather than refunds. Can you explain what this means,

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<v Speaker 1>why companies are doing this, and whether you think it's

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<v Speaker 1>likely to happen.

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<v Speaker 2>So, this was a really interesting concept that some importers

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<v Speaker 2>had raised to me, and I think we're trying to

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<v Speaker 2>push externally that basically, instead of a refund, they wanted

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<v Speaker 2>a credit on future entries. So for all of those

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<v Speaker 2>AIPA tariffs that were paid for which they were entitled

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<v Speaker 2>to a refund, they wanted to basically say, if we

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<v Speaker 2>import things in the future that were subject to a dude,

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<v Speaker 2>we just want you to credit it against what you

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<v Speaker 2>owed us on the refund for AIPA tariffs. So no

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<v Speaker 2>actual funds were exchanged. This really was a cool idea

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<v Speaker 2>for those who were subject to, for example, the steel

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<v Speaker 2>and aluminum tariffs, because they really didn't necessarily need the

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<v Speaker 2>cash on hand, but had potentially high duties for steel

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<v Speaker 2>and aluminum that they could credit against their potential refund.

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<v Speaker 2>For others, it's a little bit more complicated because others

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<v Speaker 2>were subject to really no duties at all before the

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<v Speaker 2>AIPA tariffs, and so there wasn't really anything to credit against,

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<v Speaker 2>and then some just really needed the cash on hand

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<v Speaker 2>in order to continue operating. I don't think that the

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<v Speaker 2>credit process now that there's actually a procedure for refunds,

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<v Speaker 2>I don't think that anything related to credits would actually happen.

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<v Speaker 2>But it was a really interesting concept and I thought

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<v Speaker 2>it was a creative idea.

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<v Speaker 1>Interesting. So you talked earlier. You talked earlier about how

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<v Speaker 1>the imports who are seeking refunds have to file declarations,

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<v Speaker 1>and you mentioned in a conversation in an earlier conversation

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<v Speaker 1>that we're having that a number of these declarations that

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<v Speaker 1>were submitted to customs were rejected. Can you explain why

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<v Speaker 1>those declarations were rejected? Yeah, So there's, like I said before,

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<v Speaker 1>there's a there's a customs provided form for the declaration,

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<v Speaker 1>and the declaration has to be submitted in this form

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<v Speaker 1>with the right fields included in order for it to

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<v Speaker 1>actually make it into the CAPE Portal. So I think

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<v Speaker 1>a good portion of them were actually rejected because they

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<v Speaker 1>just didn't meet the requirements of the form. And then

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<v Speaker 1>the CAPE Portal has the ability to kick out entries

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<v Speaker 1>that don't meet the requirements for this phase one. So

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<v Speaker 1>if there were entries that were subject to anti dumping

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<v Speaker 1>your counter failing duties, if there were entries that had

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<v Speaker 1>liquidated and were passed eighty days post liquidation, those entries

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<v Speaker 1>would have been kicked out by the CAPE Portal automatically

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<v Speaker 1>as well. So I really do think that some of

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<v Speaker 1>it was just learning this view process, and maybe there's

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<v Speaker 1>some growing pains that will have to go through in

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<v Speaker 1>order to be able to get through this process seamlessly.

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<v Speaker 1>So presumably they'll resubmit those declarations at another time, and

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<v Speaker 1>then maybe this the next time we're d the third time,

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<v Speaker 1>fourth time, they'll be validated.

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<v Speaker 2>Correct. Got it.

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<v Speaker 1>On April seventh, the International Trade Court, which is presiding

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<v Speaker 1>over lawsuits seeking refunds. That court ordered the Customs Agency

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<v Speaker 1>to liquidate entries and re liquidate entries without the i

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<v Speaker 1>epoteris whether or not liquidation has been finalized? Can you

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<v Speaker 1>explain what this means?

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<v Speaker 2>So basically, the court decided that if an entry had

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<v Speaker 2>liquidated in the past, what would happen is your entry

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<v Speaker 2>liquidates and you have one hundred and eighty days to

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<v Speaker 2>protest that liquidation. And just for those who don't know,

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<v Speaker 2>liquidation is basically like a true up process. Did you

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<v Speaker 2>pay enough upon importing your products at the beginning or

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<v Speaker 2>did you pay too much? And are you entitled to

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<v Speaker 2>a refund or do you owe us money? So if

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<v Speaker 2>you got a liquidation and it said you didn't pay

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<v Speaker 2>enough you OUs more, you could protest that decision. You

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<v Speaker 2>had one hundred and eighty days to do that. That's

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<v Speaker 2>still generally the case. If you don't protest, though, you

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<v Speaker 2>lose your ability to challenge your liquidation. The court made

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<v Speaker 2>an interesting decision in the aepateriff's case by saying, actually,

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<v Speaker 2>even if you are one hundred and eighty days post liquidation,

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<v Speaker 2>so your liquidation is final, we're still going to allow

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<v Speaker 2>you to seek your refund or or ordered customs to

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<v Speaker 2>provide you a refund even though you may not have

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<v Speaker 2>protested and may have quote unquote exhausted your administrative remedy.

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<v Speaker 2>And so now Customs is required to, even if no

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<v Speaker 2>protest was filed, provide a refund to those who were

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<v Speaker 2>one hundred and eighty days post liquidation.

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<v Speaker 1>Why do you think the lower court did that?

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<v Speaker 2>You know, I've thought about this, and I think ultimately

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<v Speaker 2>it was sort of a fairness issue because Iopa tariffs

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<v Speaker 2>were being collected while the case was being challenged. There

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<v Speaker 2>was a strong possibility that through the appeals process and

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<v Speaker 2>the oral argument and issuance of the Supreme Court decision,

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<v Speaker 2>there were entries that were paid and then went one

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<v Speaker 2>hundred and eighty days post liquidation, but there was no

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<v Speaker 2>order saying that they were entitled to anything. As of

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<v Speaker 2>that time, the IEPA tariffs were technically valid. So it's

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<v Speaker 2>kind of unfair to expect someone to protest an entry

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<v Speaker 2>on the basis of a decision that hasn't come out yet.

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<v Speaker 2>So I would imagine the court was trying to be

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<v Speaker 2>fair and say they really didn't know that these tariffs

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<v Speaker 2>were invalid until the Supreme Court decision came out, and

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<v Speaker 2>that really shouldn't be their.

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<v Speaker 1>Fault, right, that makes sense. So they shouldn't, you know,

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<v Speaker 1>be prejudiced because they didn't file, you know, whatever they

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<v Speaker 1>needed to, because they didn't know that they had even

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<v Speaker 1>had that option or they had a rite. So that

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<v Speaker 1>makes sense. So you said that you think the government

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<v Speaker 1>may appeal this order. Can you explain on what grounds

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<v Speaker 1>you think the government would do that and whether you

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<v Speaker 1>think they would likely succeed.

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<v Speaker 2>I think, you know, the biggest appeal option I see

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<v Speaker 2>is the blanket statement that refunds are required even for

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<v Speaker 2>those who are past their final liquidation date. And the

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<v Speaker 2>reason for that is that there is a procedural history

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<v Speaker 2>here where if you are post liquidation and you haven't protested,

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<v Speaker 2>you really haven't gone through the administrative process necessary to

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<v Speaker 2>be able to seek an appeal from a court or

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<v Speaker 2>anyone else. So really you shouldn't be entitled to a

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<v Speaker 2>refund at least I think that's what the government will argue.

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<v Speaker 2>Like I said, I mean, I think that there are

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<v Speaker 2>some importers for which that is inherently unfair because there

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<v Speaker 2>wasn't an order at the time. But one thing I

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<v Speaker 2>think we still have to remember is that while the

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<v Speaker 2>CAPE process is ongoing, there are potential importers who haven't

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<v Speaker 2>been able to file for the CAPE process because they

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<v Speaker 2>don't fit into Phase one, and their entries are liquidating,

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<v Speaker 2>and the clock is ticking on that one hundred and

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<v Speaker 2>eighty days, and I think the government may want to

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<v Speaker 2>challenge whether those people who are one hundred and eighty

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<v Speaker 2>days post liquidation are subject to receiving a refund. I'm

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<v Speaker 2>not sure how successful that will be, given sort of

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<v Speaker 2>the how different the situation is, but I do think

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<v Speaker 2>it's it's at least the strongest view for a challenge

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<v Speaker 2>that I can see.

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<v Speaker 1>So, are you saying that the order requiring liquidation and

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<v Speaker 1>re liquidation for any entries finalized or not that would

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<v Speaker 1>be appealed with respect to entries that are not that

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<v Speaker 1>you know where this one hundred and eighty daytime period

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<v Speaker 1>is now running. In other words, it hasn't expired yet

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<v Speaker 1>but is now running.

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<v Speaker 2>Yeah, I mean, I think there's definitely a possibility that

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<v Speaker 2>the government appeals across the board for all of the entries,

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<v Speaker 2>regardless of whether they've finally liquidated or not. In part

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<v Speaker 2>because the Supreme Court's decision was silent on the issue

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<v Speaker 2>of refunds, it really just said that the refund or

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<v Speaker 2>the tariffs themselves were invalid. But I think the court

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<v Speaker 2>or the government could argue that there was no refund

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<v Speaker 2>that should have been given. I think it's harder to

0:14:07.360 --> 0:14:11.040
<v Speaker 2>argue that once you've paid, and as far as I understand,

0:14:11.120 --> 0:14:13.920
<v Speaker 2>some people have actually received a refund at this point,

0:14:14.040 --> 0:14:16.520
<v Speaker 2>so that may be a more difficult argument. And that's

0:14:16.559 --> 0:14:19.440
<v Speaker 2>why I think those ones that are past that one

0:14:19.480 --> 0:14:22.880
<v Speaker 2>hundred and eighty day liquidation date are the strongest ones

0:14:22.960 --> 0:14:25.120
<v Speaker 2>to challenge at this point.

0:14:25.880 --> 0:14:29.240
<v Speaker 1>Oh I see, okay, So they may they may appeal

0:14:29.360 --> 0:14:31.800
<v Speaker 1>just on the grounds that this that you know, the

0:14:32.280 --> 0:14:34.880
<v Speaker 1>terror fruling, but the Supreme Court shouldn't have been retroactive.

0:14:35.320 --> 0:14:37.480
<v Speaker 2>But okay, got it? Okay.

0:14:37.520 --> 0:14:40.360
<v Speaker 1>And then there's also this, you know, administrative aspect that

0:14:40.400 --> 0:14:45.200
<v Speaker 1>they haven't exhausted their administrative remedies. Is that right, correct? Okay,

0:14:45.240 --> 0:14:47.680
<v Speaker 1>got it. The US Trade rep has opened so called

0:14:47.800 --> 0:14:51.080
<v Speaker 1>Section three ER what investigations in sixteen countries over access

0:14:51.120 --> 0:14:54.800
<v Speaker 1>capacity and sixty countries over the failure to prohibit imports

0:14:54.840 --> 0:14:58.080
<v Speaker 1>made using forced liebor? Can you explain what Section three

0:14:58.120 --> 0:15:00.960
<v Speaker 1>O one of the Trade Act is? What the Trade

0:15:01.000 --> 0:15:02.880
<v Speaker 1>Reps investigations are about.

0:15:03.000 --> 0:15:06.400
<v Speaker 2>Yeah, So Section three oh one allows the US Trade

0:15:06.440 --> 0:15:10.760
<v Speaker 2>Representative to address unfair trade practices that harm US commerce.

0:15:11.160 --> 0:15:13.640
<v Speaker 2>So typically you would think about this in the sense

0:15:13.680 --> 0:15:16.960
<v Speaker 2>that they're like violating trade agreements or engaging in some

0:15:17.120 --> 0:15:21.760
<v Speaker 2>level of discrimination something like that. Right now, the section

0:15:21.840 --> 0:15:25.560
<v Speaker 2>three oh one investigations that are ongoing are pretty broad.

0:15:26.480 --> 0:15:30.520
<v Speaker 2>As you mentioned, there's sixteen countries that are being investigated

0:15:30.720 --> 0:15:35.280
<v Speaker 2>in the excess capacity investigation. That's really focused on countries

0:15:35.280 --> 0:15:40.280
<v Speaker 2>that are engaging in unfair practices like subsidies or industrial

0:15:40.360 --> 0:15:44.680
<v Speaker 2>planning or suppressing domestic consumption in order to have it

0:15:45.000 --> 0:15:50.040
<v Speaker 2>have an excess capacity to export to the United States,

0:15:50.440 --> 0:15:55.800
<v Speaker 2>which potentially has an effect on US domestic manufacturing. That

0:15:55.880 --> 0:16:01.000
<v Speaker 2>investigation is more limited than the forced labor investigation that

0:16:01.080 --> 0:16:05.040
<v Speaker 2>one is investigating actually sixty countries, some of which are

0:16:05.200 --> 0:16:10.760
<v Speaker 2>close allied countries, related to forced labor practices within their

0:16:10.800 --> 0:16:16.640
<v Speaker 2>supply chains, and those are the investigation is actually pretty broad.

0:16:16.760 --> 0:16:20.960
<v Speaker 2>They're basically arguing that any forced labor within a country

0:16:21.080 --> 0:16:27.840
<v Speaker 2>supply chain could negatively impact US industry, and so both

0:16:28.040 --> 0:16:34.000
<v Speaker 2>are interestingly broad and cover a much broader range of

0:16:34.000 --> 0:16:38.600
<v Speaker 2>countries than former three on one investigations.

0:16:38.600 --> 0:16:42.720
<v Speaker 1>Interesting. So do you anticipate that the US trade reup

0:16:42.720 --> 0:16:45.600
<v Speaker 1>will take action as a result of these investigations, and

0:16:45.640 --> 0:16:48.120
<v Speaker 1>if so, do you have any view as to whether

0:16:48.440 --> 0:16:51.200
<v Speaker 1>those actions will be similar in magnitude to the terrace

0:16:51.560 --> 0:16:53.280
<v Speaker 1>the President imposed under AEPA.

0:16:53.880 --> 0:16:58.960
<v Speaker 2>I think so. I think that's really the design was

0:16:59.040 --> 0:17:05.200
<v Speaker 2>to place the APA tariffs with Section three oh one tariffs,

0:17:05.760 --> 0:17:08.720
<v Speaker 2>which is why we're seeing such a broad swap of countries,

0:17:09.280 --> 0:17:14.040
<v Speaker 2>and something like forced labor, for example, is inherently difficult

0:17:14.200 --> 0:17:18.399
<v Speaker 2>to kind of put your finger on what we're calling

0:17:18.520 --> 0:17:22.800
<v Speaker 2>forced labor or a difference in forced labor practices. You know,

0:17:23.240 --> 0:17:26.160
<v Speaker 2>pay in certain countries is going to be vastly different

0:17:26.280 --> 0:17:29.120
<v Speaker 2>than pay for workers in the United States of America

0:17:29.280 --> 0:17:33.560
<v Speaker 2>or other countries. So I do think that there is

0:17:33.640 --> 0:17:36.080
<v Speaker 2>going to be a push for the Section three oh

0:17:36.119 --> 0:17:39.879
<v Speaker 2>one tariffs to be imposed after these investigations, and I

0:17:39.920 --> 0:17:42.520
<v Speaker 2>do think they're intended to cover quite a bit like

0:17:42.560 --> 0:17:43.639
<v Speaker 2>the IPA tariffs. Did.

0:17:44.160 --> 0:17:47.760
<v Speaker 1>Do you think that legal challenges will be filed to

0:17:47.800 --> 0:17:49.760
<v Speaker 1>these three zer one terriffs, and if so, what do

0:17:49.800 --> 0:17:51.080
<v Speaker 1>you think the grounds will be.

0:17:51.960 --> 0:17:56.840
<v Speaker 2>I imagine there will be challenges. They're much harder to challenge.

0:17:56.880 --> 0:18:00.600
<v Speaker 2>I would anticipate the challenges to be really related to

0:18:00.640 --> 0:18:05.080
<v Speaker 2>the investigations themselves and the basis for the investigations. So,

0:18:05.720 --> 0:18:09.520
<v Speaker 2>like I said, the US Trade Representative can address unfair

0:18:09.560 --> 0:18:13.160
<v Speaker 2>trade practices, but they have to harm US commerce. So

0:18:13.320 --> 0:18:18.400
<v Speaker 2>if the investigations don't directly tie the trade practices within

0:18:18.440 --> 0:18:22.880
<v Speaker 2>a particular country to an exact impact on US commerce,

0:18:23.000 --> 0:18:27.359
<v Speaker 2>I think it's going to result in some challenges just

0:18:27.760 --> 0:18:30.879
<v Speaker 2>on the basis of the reasoning for the investigation alone.

0:18:31.440 --> 0:18:35.480
<v Speaker 2>And then I think if the investigations aren't thorough, if

0:18:35.520 --> 0:18:38.959
<v Speaker 2>they're sort of limited in nature in terms of how

0:18:39.040 --> 0:18:41.800
<v Speaker 2>much information we get on each of the sixty countries

0:18:41.840 --> 0:18:45.120
<v Speaker 2>for example, I think we'll see some challenges on whether

0:18:45.160 --> 0:18:48.840
<v Speaker 2>the investigations were actually sufficient to impose the tariffs that

0:18:48.840 --> 0:18:52.240
<v Speaker 2>they're planning to impose once the three oh one investigations

0:18:52.240 --> 0:18:52.880
<v Speaker 2>are done.

0:18:53.320 --> 0:18:57.159
<v Speaker 1>So, if the if the impact is too direct indirect,

0:18:57.160 --> 0:18:58.960
<v Speaker 1>do you think that that may be a challenge What

0:18:59.440 --> 0:19:03.560
<v Speaker 1>what would can you think of an example of impact

0:19:03.560 --> 0:19:07.560
<v Speaker 1>that's too indirect to well, you know, it's hard to

0:19:07.840 --> 0:19:10.680
<v Speaker 1>you know, speculate, but something that would be challenged because

0:19:10.680 --> 0:19:14.320
<v Speaker 1>it's indirect, an indirect relationship to this forced labor or

0:19:14.359 --> 0:19:15.359
<v Speaker 1>access capacity.

0:19:16.240 --> 0:19:21.680
<v Speaker 2>So let's say in a country, they have a much

0:19:21.800 --> 0:19:27.480
<v Speaker 2>lower working wage for example, so you know we're talking

0:19:27.600 --> 0:19:31.840
<v Speaker 2>since on the US dollar, and that is interpreted to

0:19:31.960 --> 0:19:37.320
<v Speaker 2>be forced labor in that particular country. And if that

0:19:37.520 --> 0:19:41.600
<v Speaker 2>country is part of a broad group of countries that imports,

0:19:41.640 --> 0:19:45.760
<v Speaker 2>for example, textiles into the United States, I think it's

0:19:45.760 --> 0:19:49.120
<v Speaker 2>going to be difficult to tie you know, low wages

0:19:49.240 --> 0:19:55.199
<v Speaker 2>in that country to a direct impact on US than

0:19:55.320 --> 0:19:59.920
<v Speaker 2>on the US textiles industry, where there are forty other

0:20:00.040 --> 0:20:04.080
<v Speaker 2>countries that also import the same thing and that have

0:20:04.280 --> 0:20:08.520
<v Speaker 2>potentially you know, actual forced labor in terms of like

0:20:08.840 --> 0:20:12.600
<v Speaker 2>you know, no pay or something like that. And trying

0:20:12.640 --> 0:20:18.200
<v Speaker 2>to specifically tie one country's force labor and supply gaene

0:20:18.200 --> 0:20:23.280
<v Speaker 2>practices to US commerce where there are others who are

0:20:23.280 --> 0:20:26.080
<v Speaker 2>similarly situated. I think that's going to be very difficult.

0:20:26.680 --> 0:20:29.639
<v Speaker 1>Wow, that's so interesting. So so like forced labor, it

0:20:29.640 --> 0:20:32.520
<v Speaker 1>sounds like it's sort of like a like a fungible term,

0:20:32.640 --> 0:20:35.600
<v Speaker 1>like it could be you know, it could mean like

0:20:35.680 --> 0:20:39.399
<v Speaker 1>many many things. And so if for example, you know,

0:20:39.960 --> 0:20:41.720
<v Speaker 1>a bunch of countries are doing the same thing, or

0:20:41.760 --> 0:20:46.240
<v Speaker 1>there's one that's actually paying nothing then the challenge would be,

0:20:46.400 --> 0:20:50.640
<v Speaker 1>I guess that they're you know, treating these other countries differently.

0:20:50.800 --> 0:20:54.040
<v Speaker 1>So this, I guess, would the argument be, it's like

0:20:54.040 --> 0:20:55.920
<v Speaker 1>a protextual tariff, right.

0:20:56.000 --> 0:20:59.600
<v Speaker 2>I think unless all of the countries who are similarly

0:20:59.640 --> 0:21:03.760
<v Speaker 2>situated are treated exactly the same, then I think there's

0:21:03.840 --> 0:21:08.840
<v Speaker 2>some argument one that it's not really we're not really

0:21:08.880 --> 0:21:13.360
<v Speaker 2>addressing the impact on US commerce with this particular country.

0:21:14.040 --> 0:21:16.240
<v Speaker 2>But I think the other issue is that you can't

0:21:16.280 --> 0:21:20.200
<v Speaker 2>really show that the actions of this particular country are

0:21:20.280 --> 0:21:24.560
<v Speaker 2>impacting US commerce where there are a number of them.

0:21:24.960 --> 0:21:27.760
<v Speaker 2>So I think it's going to be interesting to see

0:21:27.760 --> 0:21:30.439
<v Speaker 2>how the investigation of all of the country sort of

0:21:30.480 --> 0:21:34.680
<v Speaker 2>plays into each other and to see how different countries

0:21:34.760 --> 0:21:38.320
<v Speaker 2>are treated, because if we remember with the AEPA tariffs,

0:21:38.320 --> 0:21:42.000
<v Speaker 2>there were certain countries that were particularly targeted and others

0:21:42.040 --> 0:21:45.760
<v Speaker 2>who engaged in sort of trade negotiations and things like

0:21:45.800 --> 0:21:49.080
<v Speaker 2>that with with the current administration were treated somewhat differently.

0:21:50.240 --> 0:21:53.600
<v Speaker 2>So it'll be interesting to see how this plays out

0:21:53.720 --> 0:21:56.480
<v Speaker 2>once the three or one fits are actually announced.

0:21:56.960 --> 0:22:00.480
<v Speaker 1>Do you anticipate that you know, deals with be struck

0:22:00.480 --> 0:22:02.480
<v Speaker 1>again based on these three one tariffs?

0:22:02.680 --> 0:22:04.719
<v Speaker 2>I can imagine that there will be a lot of

0:22:04.760 --> 0:22:09.800
<v Speaker 2>trade discussions once the investigations are done and there's a

0:22:09.880 --> 0:22:13.560
<v Speaker 2>finding by the US Trade Representative that tariffs need to

0:22:13.560 --> 0:22:16.600
<v Speaker 2>be imposed on particular countries, I can see some trade

0:22:16.640 --> 0:22:17.919
<v Speaker 2>negotiations for sure.

0:22:18.440 --> 0:22:21.800
<v Speaker 1>Yeah, that makes sense to me. So with regard to

0:22:21.840 --> 0:22:24.440
<v Speaker 1>those challenges, and it's so interesting with regard to those

0:22:24.520 --> 0:22:29.000
<v Speaker 1>legal challenges or potential legal challenges, how do you view

0:22:29.040 --> 0:22:31.040
<v Speaker 1>the strength of those challenges, Like if it's like a

0:22:31.080 --> 0:22:35.520
<v Speaker 1>causation argument, or or if it's you know, an argument

0:22:35.560 --> 0:22:37.399
<v Speaker 1>that you know, all these other countries are doing it,

0:22:37.480 --> 0:22:40.359
<v Speaker 1>so there's there's there's you know, no reason why you

0:22:40.359 --> 0:22:42.479
<v Speaker 1>should impose it on us, Like what do you view

0:22:42.520 --> 0:22:44.080
<v Speaker 1>the strength of those legal challenges.

0:22:44.760 --> 0:22:47.760
<v Speaker 2>I think the challenges are hard. Section three oh one

0:22:47.800 --> 0:22:52.080
<v Speaker 2>tariffs have an established process. You know, the US Trade

0:22:52.080 --> 0:22:57.320
<v Speaker 2>Representative goes through the investigation period. There's a public comment process,

0:22:57.359 --> 0:23:02.240
<v Speaker 2>sometimes there are hearings, and so even if there are

0:23:02.359 --> 0:23:08.119
<v Speaker 2>questions about the validity of a particular investigation, and I

0:23:08.240 --> 0:23:12.360
<v Speaker 2>think a challenge becomes more difficult because of the process

0:23:12.359 --> 0:23:17.119
<v Speaker 2>that the US Trade Representative goes through. So I'm not

0:23:17.160 --> 0:23:19.800
<v Speaker 2>sure how successful they will be. Three to one challenges

0:23:19.840 --> 0:23:23.800
<v Speaker 2>have historically been hard, but given how broad these are,

0:23:23.880 --> 0:23:26.680
<v Speaker 2>I do think there are some grounds. There will may

0:23:26.680 --> 0:23:29.919
<v Speaker 2>be some grounds for challenges once the investigations come.

0:23:29.800 --> 0:23:32.240
<v Speaker 1>Out, and that may take many years, Is that right?

0:23:32.800 --> 0:23:35.760
<v Speaker 2>I think so? Yeah. Well, I guess I should clarify.

0:23:35.960 --> 0:23:41.040
<v Speaker 2>Do you mean the challenge process itself, right? Yes? Absolutely?

0:23:41.080 --> 0:23:42.640
<v Speaker 2>That could take a very long time.

0:23:43.480 --> 0:23:46.880
<v Speaker 1>Yeah, because there's I think there's a there were challenges

0:23:46.880 --> 0:23:50.000
<v Speaker 1>to the Trump administration's first real one tariffs, and I

0:23:50.040 --> 0:23:52.480
<v Speaker 1>think those are still playing out in appellate.

0:23:52.119 --> 0:23:54.120
<v Speaker 2>Courts now, right, exactly.

0:23:54.600 --> 0:23:57.200
<v Speaker 1>Well, thank you so much, Joyce for being here. I'm

0:23:57.200 --> 0:23:59.560
<v Speaker 1>sure we'll probably have to have you on again at

0:23:59.560 --> 0:24:02.120
<v Speaker 1>some point to explain what's going on.

0:24:02.600 --> 0:24:04.800
<v Speaker 2>Well, I would love to be here. It's always a pleasure.

0:24:04.960 --> 0:24:06.000
<v Speaker 2>Thank you so much, Holly.

0:24:06.280 --> 0:24:07.920
<v Speaker 1>I think we're going to leave it there. We'll wrap

0:24:08.119 --> 0:24:10.880
<v Speaker 1>up this episode of Boots and Verdicts. As always, thank

0:24:10.920 --> 0:24:13.480
<v Speaker 1>you for listening. If you have any questions about anything

0:24:13.480 --> 0:24:15.800
<v Speaker 1>that we talked about on this episode, please don't hesitate

0:24:15.800 --> 0:24:18.880
<v Speaker 1>to reach out to us at your convenience. As a reminder,

0:24:18.920 --> 0:24:20.880
<v Speaker 1>you can find all of our research on the Blueberg

0:24:20.960 --> 0:24:23.800
<v Speaker 1>terminal at big You can find our litigation and policy

0:24:23.880 --> 0:24:27.000
<v Speaker 1>dashboard in the terminal at BI Lasgow. And we want

0:24:27.000 --> 0:24:29.600
<v Speaker 1>to thank our producer Adja Somani, without whom this podcast

0:24:29.600 --> 0:24:32.280
<v Speaker 1>would never publish. Thank you for listening and have a

0:24:32.280 --> 0:24:48.680
<v Speaker 1>great day.