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Steel and aluminum producers seeking to qualify for reduced Section 232 tariffs must navigate an intensive record-keeping process to demonstrate ongoing compliance, trade lawyers said.
Last month, the Commerce Department introduced a process for Canada and Mexico steel and aluminum makers that feed the U.S. auto and truck industry's supply chain to cut the current 50% tariff in half. Qualifying for the 25% rate requires producers to commit to building or expanding their primary metal production in the U.S.
Metal producers have to commit to specific capacity‑expansion projects and submit extensive certified documentation on those projects, according to a Federal Register document. They must then meet milestones set and monitored by the Commerce Department and provide regular, detailed reports showing how shipments tie back to the approved projects.
If the Commerce Department determines the supplier has fallen short of the requirements, the agency can revoke the reduced tariff and require full payment. Hence, ongoing documentation and traceability are critical to proving continued compliance, trade lawyers told Supply Chain Dive.
