China Responds to U.S. Tariff Measures with Additional Duties and Export Controls

February 5, 2025

In response to the recent U.S. announcement of increased tariffs on Chinese imports, China’s Ministry of Commerce and customs administration have introduced additional trade measures targeting key U.S. goods. The new tariffs and export controls, set to take effect on February 10, mark the latest escalation in the ongoing trade tensions between the two economic powerhouses.

Increased Tariffs on U.S. Imports

China will impose additional tariffs on a range of U.S. products, including energy resources, vehicles, and industrial equipment, significantly increasing the cost of imports. The new tariffs are as follows:

  • A 15% additional tariff on coal and liquefied natural gas (LNG) classified under HTS headings 2701, 2702, and 2711.
  • A 10% additional tariff on crude oil, agricultural machinery, large-displacement vehicles, and pickup trucks under HTS headings 2709, 8419, 8424, 8432, 8433, 8434, 8436, 8437, 8438, 8479, 8701, 8703, 8704, and 8716.

These tariffs will be applied in addition to existing duties, with no exemptions permitted under current bonded and duty reduction/exemption policies.

Stricter Export Controls on Critical Materials

In addition to higher tariffs, China has expanded its export control measures to restrict the flow of critical raw materials and technologies. The latest restrictions target:

  • Tungsten, a key material used in industrial and defense applications.
  • Tellurium, a crucial component in the production of solar cells.

These export restrictions are effective immediately, limiting U.S. access to essential raw materials and potentially disrupting supply chains in industries reliant on Chinese-sourced resources.

U.S. Companies Added to China’s ‘Unreliable Entities List’

As part of its broader regulatory actions, China has also designated two U.S. companies as “unreliable entities”, accusing them of violating normal market trading principles:

  • Illumina, a biotech company specializing in genetic sequencing.
  • PVH Group, the parent company of Calvin Klein and Tommy Hilfiger.

Companies placed on the Unreliable Entities List may face restrictions on market access, investment limitations, and other trade barriers within China.

China Investigates Google for Alleged Anti-Monopoly Violations

In a separate announcement, China’s State Administration for Market Regulation (SAMR) revealed an anti-monopoly investigation into Google. While Google’s search engine is already blocked in China, the company still maintains minimal operations in the country.

This investigation signals a broader effort by China to regulate foreign tech companies and could lead to additional restrictions on U.S. firms operating in China’s digital and technology sectors.

What This Means for Businesses

China’s latest measures represent a significant escalation in trade restrictions, affecting energy, technology, and manufacturing sectors. The additional tariffs will increase costs for U.S. exporters, while the expanded export controls will limit access to critical raw materials, forcing companies to seek alternative suppliers.

Businesses engaged in U.S.-China trade must closely monitor these developments, assess potential risks, and explore strategies to mitigate the impact of these new regulations.

CATTS provides expert guidance on trade compliance, tariff management, and supply chain adjustments to help businesses navigate these evolving regulatory challenges. Contact us to discuss how these changes may impact your operations and how to stay compliant.

How we can help

CATTS Consultancy

China’s additional tariffs and export controls have added new complexities to U.S.-China trade operations. CATTS provides expert assistance in assessing the impact on your supply chain, ensuring compliance with updated tariffs, and addressing regulatory challenges. Protect your operations and adapt effectively to the shifting trade landscape.

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