The Office of the U.S. Trade Representative has imposed new Section 301 tariffs on goods from 60 economies following a review of their forced-labor import controls. Effective July 24, 2026, the action affects most U.S. imports and raises immediate compliance questions involving classification, exemptions, supplier records, and upstream traceability.
Key Takeaways
- The new Section 301 duties generally apply at rates of 10 percent or 12.5 percent.
- The 60 covered economies account for 99.4 percent of U.S. imports, according to USTR.
- The duties became applicable on July 24, 2026, with a limited exception for qualifying goods already in transit.
- Product exemptions and country-specific calculations make tariff classification central to determining exposure.
- Recent Customs and Border Protection guidance emphasizes supplier due diligence and detailed sourcing records.
U.S. supply chain compliance entered a stricter phase on July 23, when the Office of the U.S. Trade Representative announced final action following 60 Section 301 investigations. The investigations examined whether major trading partners had imposed and effectively enforced restrictions on imported goods produced with forced labor.
The action applies a 10 percent Section 301 duty to goods from 18 economies that adopted qualifying restrictions, made related commitments, or established partial controls. Goods from most other investigated economies face a 12.5 percent duty, subject to product exemptions listed in the federal notice.
Products from the European Union and Taiwan receive a different calculation. When a product’s existing most-favored-nation duty is below 10 percent, the new Section 301 duty brings the combined rate to 10 percent. No additional Section 301 duty applies when the existing rate is already at least 10 percent.
A similar structure applies to Japan, South Korea, and Switzerland, but with a 12.5 percent threshold. The distinctions mean importers cannot assess their exposure through country of origin alone. They must also verify each product’s tariff classification and existing duty rate.
The duties became applicable to goods entered for consumption, or withdrawn from a warehouse for consumption, beginning at 12:01 a.m. Eastern time on July 24. Goods loaded and in final transit before that time could qualify for an exception when entered before 12:01 a.m. Eastern time on July 28.
“I am encouraged by the trading partners who have moved quickly to adopt forced labor import prohibitions,” U.S. Trade Representative Jamieson Greer said when announcing the action.
U.S. Supply Chain Records Face Higher Scrutiny
The new duties add another layer to an enforcement structure already administered by U.S. Customs and Border Protection. Importers may now need to evaluate both tariff exposure and whether their sourcing records could withstand a forced-labor review.
CBP’s June 2026 operational guidance encourages importers to conduct supplier due diligence before their goods are detained. The guidance identifies transactional, financial, production, and transportation records as information that can help establish where materials originated and how goods moved through the supply chain.
That requirement can be difficult for companies purchasing through distributors or contract manufacturers. A direct supplier may know where a finished product was assembled while providing limited visibility into farms, mills, smelters, processors, or subcontractors farther upstream.
Supplier questionnaires, purchase agreements, and record-retention procedures can help address those information gaps. Importers may also need a defined response process involving procurement, customs, logistics, and legal personnel when CBP requests documentation.
The enforcement direction also reflects a broader federal focus on supply chain stability, particularly where concentrated sourcing could expose businesses to operational or regulatory disruptions.
Recent CBP actions demonstrate the range of products that can face detention. On June 16, 2026, the agency issued a Withhold Release Order covering copper and copper products manufactured by Serbia Zijin Copper D.O.O. A week later, it issued two orders covering garments produced by Needle Craft and Casual Wear in Jordan.
The 2025 update to the Uyghur Forced Labor Prevention Act strategy listed 144 entities at that time. It also identified high-priority sectors including apparel, cotton and cotton products, silica-based products, tomatoes, aluminum, polyvinyl chloride, and seafood.
These enforcement tools operate separately from the new Section 301 tariffs. A product may therefore be subject to an additional duty while also facing detention when CBP identifies concerns about its production or raw-material sources.
Classification and Exemptions Shape the Cost
The tariff action includes exemptions for selected raw materials and products that USTR determined could affect domestic availability, create broad economic disruptions, or remain difficult to obtain in sufficient quantities from U.S. or alternative sources.
Other exemptions cover products for which additional duties may have limited effect on the practices under review. USTR also listed country-specific exclusions connected to commitments or efforts to establish stronger forced-labor import controls.
For importers, those exclusions make Harmonized Tariff Schedule classification a central compliance issue. An incorrect classification could change whether a product is covered, exempt, or subject to a country-specific duty calculation.
Goods admitted into a U.S. foreign-trade zone may also require privileged foreign status when covered by the additional duty, unless they qualify for domestic status. That treatment can affect how duties are calculated when merchandise later enters U.S. commerce.
The notice also directs USTR to establish tariff-rate quotas, when feasible, for certain textile and apparel imports from Bangladesh, Cambodia, Indonesia, and Malaysia. The planned quotas would be linked to each economy’s use of U.S. cotton or textile inputs.
Until the quotas are established, the applicable 10 percent Section 301 duty remains in place for goods expected to fall within the mechanism. USTR is required to publish additional information about the quotas and their effective date before they become operational.
Cost planning may extend beyond customs entries. A July analysis of tariff-related pricing decisions found that some surveyed businesses continued considering price adjustments after paying higher import duties. The findings represented companies in the Federal Reserve Bank of New York’s district rather than the entire country.
The immediate compliance task is therefore broader than checking a new rate. Importers must connect origin data, tariff codes, supplier disclosures, production records, and contract terms before goods reach a U.S. port. Under the new framework, U.S. supply chain decisions increasingly depend on whether that information can be produced quickly and consistently.
Frequently Asked Questions
What Changed Under the New Section 301 Action?
USTR imposed new duties on most goods from 60 investigated economies after reviewing their forced-labor import controls. The applicable rate is generally 10 percent or 12.5 percent, although product exemptions and special country calculations apply.
When Did the New Duties Take Effect?
The duties became applicable at 12:01 a.m. Eastern time on July 24, 2026. A limited in-transit exception covered qualifying goods entered before 12:01 a.m. Eastern time on July 28.
Does the Action Ban All Imports From the Covered Economies?
No. The action applies additional duties rather than a blanket prohibition on all goods from the covered economies. Separate U.S. forced-labor authorities can still lead CBP to detain or exclude particular shipments.
What Records May Importers Need?
Importers may need transaction records, production documentation, transportation records, and information tracing raw materials to finished goods. These records can support U.S. supply chain compliance when CBP reviews a shipment.
Which Products Are Exempt?
The exemptions vary by tariff classification and economy. They include selected raw materials, products associated with possible broad supply disruptions, and goods that may be unavailable in sufficient quantities from U.S. or alternative sources.
