International Trade Update: United States Trade Representative Halts Chinese-Vessel Port Fees
In the wake of a recent and markedly successful U.S.-China trade mission, the Office of the United States Trade Representative (“USTR”) has issued a formal notice suspending the actions and sanctions previously levied under Section 301 of the Trade Act. The USTR – at the direction of President Trump – first announced the proposed suspension on November 6, 2025, following the White House’s November 1, 2025 proclamation of a historic trade deal having been reached between President Trump and China President Xi Jinping. The Office of the USTR also issued a Request for Comments on Suspending Section 301 Action for One Year: China’s Targeting of the Maritime, Logistics, and Shipbuilding Sectors for Dominance. The comment period – while uncharacteristically brief – applied only to the USTR’s November 6, 2025 notice. The majority of those comments supported the proposal to suspend the trade action. The USTR has extended comments to its October 16, 2025 notice through November 12, 2025.
The impetus behind the trade and economic deal struck between the world’s two-largest-economic powers emanated from a strong desire to safeguard U.S. economic strength and national security. To bolster those concepts China has agreed to help stop the outward flow of substances used in fentanyl production, eliminate export controls on rare earth elements and select critical minerals, end retaliation against certain U.S. manufacturers and semiconductor producers, and expand its purchasing market to U.S. agricultural products, particularly soybeans. The U.S. will in turn lower tariffs on Chinese imports – although a 10% is expected to remain in place during the suspension, extend the expiration of certain Section 301 tariff exclusions, and suspend implementation of other trade sanctions.
The noticed suspension went into effect on November 10, 2025 and shall likely stay in place for one year, or until end of day November 9, 2026, unless the USTR deems further actions appropriate in advance of the suspension deadline. The suspension period will be marked by a cessation on fees for maritime transport services under Annexes I, II, or III of the April 23, 2025 notice, as modified by the October 16, 2025 notice, which pertain to Chinese-operated, Chinese-owned, and foreign-origin car carriers, respectively. Additionally, neither the U.S. nor China will accrue any liability for duties, which would otherwise be levied under Annex V. A of the October notice. The penalty pause comes as a welcomed relief to those operators, ports, and transportation professionals and entities subject to financial setback due to the mutual-retaliatory trade policies. The respite from fees and tariffs may also allow the U.S. to enhance its efforts to strengthen domestic trade policy and work with select vendors and contractors to revitalize, reimagine, and reform the U.S. Shipbuilding industry, while welcoming foreign economic participation and investment from trusted partners.
Will the temporary suspension serve to lower global shipping costs and offset the impact of commercial-supply-chain disruption? Will it allow the current administration time to identify creative solutions to attract investment into American-built ships? Will it mitigate the higher prices and negative impact experienced by domestic industry sectors heavily reliant on international trade? And what will the fee and penalty schedule look like at the conclusion of the suspension? Opportunities for enhanced trade and supply-chain modifications abound. For more information concerning answers to these and other international trade and trade-finance queries, please contact international trade, supply-chain, and trade-finance professional, Stephen Hanemann, at [email protected].
Stephen Hanemann guides some of the world’s most advanced and sophisticated companies through leveraging their trade, finance, and logistics-related challenges and opportunities. Stephen believes in real-time, practical legal solutions for clients engaged in admiralty and maritime operations, intermodal and multi-modal shipment; project and asset-acquisition finance; import-export and customs regulation compliance.
