The following analysis was in-part provided by NCBFAA Customs Counsel, Lenny Feldman and Legislative Advisor, Nicole Bivens Collinson, both of Sandler, Travis & Rosenberg, P.A., along with other news sources.

The presidential proclamation released late February 10th, 2025 states that President Trump is exercising his authority under Section 232 of the Trade Expansion Act of 1962 to adjust imports of steel and aluminum to protect our national security. On March 12th, 2025, all countries will be subject to the 25% tariff on steel, aluminum, and specified derivative products imported into the United States. A fact sheet argued that the exemptions led to falling domestic production.

An expanded list of derivative products that have yet to be specified will also be subject to the tariffs, and it appears that the effective date of those tariffs is dependent upon the Secretary of Commerce notifying that an adequate system is in place to fully, efficiently, and expediently process and collect the tariffs for the covered articles.

For steel (any derivative product in the Annex that is not classified in Chapter 73 of the HTSUS), the additional duty shall only apply to the steel content of the derivative steel article. For aluminum (any derivative product in the Annex that is NOT classified in chapter 76 of the HTSUS), the additional 25% shall apply only to the aluminum content of the derivative article. Further, for aluminum products and derivatives, if the primary aluminum originates in Russia, the duty rate shall be 200%. Primary aluminum is defined as new aluminum metal that is produced from alumina (or aluminum oxide) by the electrolytic Hall-Heroult process.

The additional products won’t be subject to Section 232 tariffs if they’re processed from steel melted and poured in the US. To qualify, importers will have to provide CBP additional data on steel content. The proclamation also sets a process for producers or trade associations to request that goods be added to the list of derivatives subject to the additional tariffs. Similarly for aluminum, importers shall provide CBP any information necessary to identify the aluminum content used in the manufacture of aluminum derivative articles. CBP will publish guidance or regulations on the required documentation as soon as practicable.

All previous steel and aluminum agreements with trading partners including Argentina, Australia, Brazil, Canada, the EU, Japan, Mexico, South Korea, Ukraine, the U.A.E., or the UK are cancelled, effective March 12th. For steel products and derivatives from Turkey, a 50% tariff will be applied.

Effective February 11th, no exclusions or exemptions will be issued and all generally-approved exclusions shall terminate on March 12th. However, if an importer has an existing exclusion for steel or aluminum products, the Commerce Department has issued a notice that the exclusion is effective until the expiration date or until their excluded volume is exhausted, whichever occurs first.

The Commerce Department has been directed to develop a process for including additional products to be subject to the tariffs and added to the Annexes for both steel and aluminum products and derivatives within a 90 day period. Domestic steel or aluminum producers, or industry associations representing steel products producers, can petition the Commerce Department to add a product to the list. The Commerce Department will make a determination within 60 days of the request whether to add it to the Annex or not.

No duty drawback will be allowed on these tariffs.

Steel and aluminum products or their derivatives subject to these tariffs that are admitted into a foreign trade zone on or after 12:01AM on March 12th (unless eligible for admission under “domestic status”) must be admitted as “privileged foreign status” and will be subject to the duties upon entry for consumption.

Further, it directs CBP to prioritize reviewing classification of steel and its derivative products and directs CBP to issue penalties without consideration of mitigating factors if it finds such products misclassified in a manner that avoids the additional tariffs. As a penalty, mitigation and settlement processes are all statutorily recognized, and the implementation of the Proclamation in this regard may give rise to judicial challenge.

Notably, the aluminum proclamation is a bit different. CBP is directed to prioritize reviewing classification of aluminum articles and derivative aluminum articles and to assess monetary penalties in the maximum amount permitted by law in the event that it discovers misclassification of goods to avoid the duties.

RIM will continue to closely monitor this evolving situation and provide updates as necessary. Please reach out to your RIM representative should you have any further questions.