A Kansas trade law expert explained the significance of the trade sanctions cases involving washers and solar cells and solar modules whose results were released by the Trump administration earlier this week.
“These are two different cases that have been reported together, under what’s called Section 201 of the Trade Act of 1974,” said Raj Bhala, the Brennesein Distinguished Professor at the University of Kansas Law School, and a Senior Advisor at Dentons. “Section 201 allows the President, after a recommendation from the International Trade Commission, to impose trade barriers on imports that have been increasing into the United States that are a substantial cause of serious injury to a domestic industry.”
Whirlpool was the lead in the washer case, with solar cell and solar module producers banding together in the other case.
“The President agreed on Monday to put what we would call a Tariff Rate Quota, it’s reported as increased tariffs, but it’s actually a Tariff Rate Quota, or TRQ on foreign washing machines and foreign solar cells,” said Bhala. “It’s a four-year remedy. It lasts for four years. It’s designed to protect our American producers of the washing machines and of the cells.”
This could make a difference the next time you go to a big-box store to buy a washer.
“The LG or the Samsung model, assuming it’s made overseas, Samsung does make some in the U.S., at its plant in South Carolina, but assuming the Samsung or LG model is made overseas, which they generally are, it will face a tariff of anywhere from 20 to 50 percent this year,” said Bhala. “In the next three years, 2019, 2020, 2021 of up to 40 percent. That’s a big price difference. If you’re looking at a $1000 washing machine, it could be as much as $1500,
because of the tariff.”
Whirlpool told the Dayton Daily News that it plans to add 200 jobs in Ohio as a result of additional expected sales because of the tariff.