The last few weeks have been a busy one for importers of European goods, as several announcements about the tariffs and duties their products will be subject to have taken place.

This past March, tariffs were imposed that increased duty rates from the current 10% to 15% on the whole aircraft, as well as attaching a 25% duty to major European imports including alcohol, wine, cheese, metals, and some manufactured goods.

The genesis of this was a 16-year-old lawsuit within the WTO over subsidies given by some EU companies to aircraft manufacturing giant Airbus, which the USA argued were violations of WTO rules. When the WTO finally ruled in favor of the USA, tariffs were announced to counteract the subsidies.

The good news came for US importers of European goods late last week as the governments of both France and Spain announced they were removing the contentious subsidies from the contracts they held with Airbus. The EU requested immediate removal of the tariffs in the USA, citing their cure for the controversial loans that had spurred the initial lawsuit to be filed in 2004.

It is not immediately clear that the tariffs imposed from this case will be removed, and as of yet, it is not clear they will be reduced.

Further duties on European imports have been threatened for months on several different fronts for a few different disputes over international trade policies. This new set of tariffs deals with the US and EU dispute over a “digital services tax” that the US government believes unfairly targets only large US-based tech firms.

This has been a contentious point for many months, with the US and tech firms claiming that this action unfairly targets only foreign, and mostly American, technology firms, due to the specifications of the scale of the firms affected. When they go into effect the tariffs will largely target French luxury goods- cosmetics, handbags, soaps, and other beauty products that had not been touched by earlier tariffs.

Thankfully for importers, these tariffs are currently suspended and not scheduled to go into full effect until 2021, and so these impositions will not have an immediate effect on importers. The hope is that this will spur action to the negotiating table, but they could be implemented at any time.

If you have any questions about how these tariffs affect your company and your ability to seek drawback refunds, please contact us at www.jmrodgers.com

Sincerely,

James Rodgers CEO