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Updated May 23, 2019
Section 232 of the Trade Expansion Act of 1962
Background
if appropriate. An Executive Summary of the final report
The Trump Administration has conducted multiple
(excluding any confidential or classified material) must be
investigations under Section 232 of the Trade Expansion
published in the Federal Register.
Act of 1962 (19 U.S.C. § 1862, as amended) to determine if
Presidential Action and Notification. If Commerce finds
certain imports threaten to impair national security.
in the negative, Commerce informs the President and no
President Trump acted after three separate investigations
further action is required. If Commerce determines in the
found potential threats; two additional investigations are
affirmative, the President, upon receipt of the report, has 90
ongoing. Prior to the Trump Administration, the last time a
days to (1) determine whether he concurs with its findings;
president imposed tariffs or other trade restrictions under
and (2) if so, determine the nature and duration of the action
Section 232 was in 1986, based on a 1983 investigation into
to be taken to adjust the subject imports. The President may
imports of machine tools. Recent action under Section 232
decide to impose tariffs or quotas to offset the adverse
has generated active debate in Congress and at the
effect, without any limits on the duration of tariff or quota
multilateral level, including legislative initiatives to amend
amounts, or take other action. The President may exclude
the congressional delegation of authority under Section 232
specific product categories, countries, or provide other
to the President.
exemptions. After making a determination, the President
Section 232 Process
must implement the action within 15 days, and submit a
Section 232 allows any department, agency head, or any
written statement to Congress explaining the actions or
“interested party” to request the Department of Commerce
inaction within 30 days. The President must also publish his
(Commerce) to initiate an investigation to ascertain the
determination in the Federal Register.
effect of specific imports on the national security of the
Figure 1. Section 232 Investigation Process
United States. Commerce may self-initiate an investigation.
Investigation. Once a Section 232 investigation is
requested in writing, Commerce must “immediately initiate
an appropriate investigation to determine the effects on the
national security” of the subject imports. After consulting
with the Secretary of Defense, other “appropriate officers of
the United States,” and the public, if appropriate,
Commerce has 270 days from the initiation date to prepare
a report advising the President whether the targeted product
is being imported “in certain quantities or under such
circumstances” to impair U.S. national security, and to
provide recommendations based on the findings.
The Bureau of Industry and Security (BIS) at Commerce
conducts the investigation based on federal regulations
codified in 15 CFR § 705 (Effect of Imported Articles on
the National Security). In terms of national security,
Commerce considers: (1) existing domestic production of

the product; (2) future capacity needs; (3) the manpower,
Source: CRS graphic based on 19 U.S.C. § 1862.
raw materials, production equipment, facilities, and other
Prior Section 232 Actions
supplies needed to meet projected national defense
Prior to the Trump Administration, 26 Section 232 national
requirements; (4) growth requirements, including the
security investigations were initiated, beginning in 1963.
investment, exploration, and development to meet them;
Previous investigations of manufactured goods were more
and (5) any other relevant factors.
tightly focused on specific products, including antifriction
Regarding the subject imports, Commerce must consider:
bearings and gears and gearing products. Of the 26 cases
(1) the impact of foreign competition on the domestic
initiated (excluding Trump Administration investigations),
industry deemed essential for national security; (2) the
Commerce made negative determinations 62% of the time.
effects that the “displacement of domestic products” cause,
Prior to 2018, when Commerce made positive
including substantial unemployment, decreases in public
determinations, the President recommended action six times
revenue, loss of investment, special skills, or production
(Figure 2). In one case, the President sought voluntary
capacity; and (3) any other relevant factors that are causing,
restraint agreements. Five positive determinations and
or will cause a weakening in the national economy.
actions were related to petroleum products or crude oil: one
Commerce may request public comments or hold hearings,
https://crsreports.congress.gov


Section 232 of the Trade Expansion Act of 1962
resulted in a conservation fee, later held illegal by a federal
of fairly traded goods based on U.S. International Trade
court; two actions were based on the Mandatory Oil Import
Commission (ITC) investigations of whether the imports
Program that predated enactment of Section 232; and twice
are causing or threaten to cause serious injury. Rather than
the President imposed an embargo (on crude oil from Iran
focusing on national security, however, Section 201
in 1979 and on crude oil from Libya in 1982).
investigations aim to help the U.S. industry return to health.
Figure 2. Section 232 Investigations 1963-2019
Presidential action is also required in Section 201.
Other enforcement tools include antidumping (AD) and
countervailing duty (CVD) actions, provided when a
domestic industry is materially injured, or threatened with
material injury, either by sales found to be at less than fair
value in the U.S. market (AD) or of products found to be
subsidized by a foreign government or other public entities
(CVD). Presidential action is not required in these
investigations; it is automatic based on affirmative findings

jointly by the ITC and Commerce Department.
Source: CRS Graphic based on BIS data (https://www.bis.doc.gov/).
WTO Implications
Trump Administration and Section 232
Under the World Trade Organization (WTO) agreements,
Commerce initiated investigations into steel and aluminum
Article XXI of the General Agreement on Tariffs and Trade
imports in April 2017 (82 FR 19205, 82 FR 21509). In each
(GATT) allows WTO members to take measures in order to
investigation, Commerce analyzed current and future
protect “essential security interests.” However, several
requirements for national defense and 16 specific critical
WTO trading partners, including China, the EU and India,
infrastructure sectors, and determined that the quantities
have challenged the current U.S. actions by alleging that
and circumstances of imports threaten to impair the national
they violate GATT Article I, which obligates WTO
security and provided recommendations.
members to treat one country’s goods no less favorably
The President concurred with Commerce’s findings, and
than another member’s; and GATT Article II, which
effective March 23, 2018, applied 25% tariffs on steel
generally prohibits members from placing tariffs on goods
imports and 10 % tariffs on imports of aluminum. Initially,
in excess of the upper limits to which they agreed to when
several countries, including Canada, Mexico, and the
acceding to the WTO. Some WTO members have also
European Union (EU) were temporarily exempted from the
asserted that the U.S. actions violate the WTO Agreement
tariffs, pending negotiations on potential alternative
on Safeguards and have, or plan to, impose counter tariffs
measures. Permanent tariff exemptions were granted to
on U.S. imports, which also may raise questions about
Brazil and South Korea for steel and to Argentina for steel
whether they are upholding similar WTO commitments.
and aluminum in exchange for quantitative limitations.
Issues for Congress
Australia was exempted from both tariffs with no
The recent Section 232 investigations and actions raise a
quantitative restrictions. In May 2019, the United States,
number of issues for Congress, including:
Mexico, and Canada announced a joint monitoring and
 What is the economic impact of the tariffs, and
consultation system to replace the tariffs.
retaliatory tariffs, on U.S. producers, downstream
Commerce initiated a third Section 232 investigation into
domestic industries, and consumers?
the imports of automobiles and certain automotive parts in
 Should Congress consider amending current delegated
May 2018 (83 FR 24735-24737). Commerce concluded that
authorities under Section 232, possibly by requiring
auto imports pose a national security threat because they
congressional consultation or approval, requiring an
affect domestic producers’ global competitiveness and the
economic impact study, or by further delineating the
research and development needed to maintain U.S. military
process and factors to be considered in an
superiority. On May 17, 2019, the President directed the
investigation?
U.S. Trade Representative to negotiate with Japan, the EU,
 Should Congress consider establishing specific or
and others to address the threat. Autos were part of the
Administration’s negotiations to update
enhanced new trade agreement negotiating objectives
free trade
to pursue negotiations to establish multilateral rules
agreements with South Korea and with Canada and Mexico.
that address newer issues such as excess capacity,
In July 2018, Commerce launched a Section 232
state-owned enterprises, or anti-corruption?
investigation into uranium ore and product imports in
 What is the potential impact of using unilateral
response to a petition from two U.S. mining companies and,
enforcement tools on U.S. allies? Will they be less
in March 2019, began an investigation into titanium sponge
likely to engage or partner in other negotiations?
imports after a petition from a U.S. firm.
 Could U.S. unilateral actions and broad application of
How Does Section 232 Differ from Other
Trade Enforcement Tools?
the WTO Article XXI undermine the WTO rules and
the multilateral trading system?
Section 232 is one of several U.S. policy tools to address
imports and unfair trade practices. For example, Section
Rachel F. Fefer, Analyst in International Trade and
201 of the Trade Act of 1974 (19 U.S.C. § 2252 et seq.)
Finance
addresses temporary safeguard measures for import surges
https://crsreports.congress.gov

Section 232 of the Trade Expansion Act of 1962

IF10667
Vivian C. Jones, Specialist in International Trade and
Finance


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https://crsreports.congress.gov | IF10667 · VERSION 13 · UPDATED