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BOULDER, CO (Oct. 20, 2020) — PeopleForBikes, with the assistance of their nearly 300 member companies, saved the bike industry more than $130 million in Section 301 tariffs since September 2018.
Section 301 tariffs represent additional duties paid on nearly all imported goods from China. The United States Trade Representative (USTR) increased these duties over the last two and a half years, creating significant cost increases for the bike industry. With additional duties of up to 25%, these tariffs reduce an already small margin of profit for many businesses, tying up hundreds of million of dollars of capital in duty deposits, making many bicycle products much more expensive for both the industry and consumers.
Tariff Action and Exclusion Requests
There is no stronger voice representing the bike industry in front of the USTR than PeopleForBikes. PeopleForBikes acted on every opportunity to obtain tariff relief and helped save the bike industry more than $130 million in excess duties and tariffs.
When the USTR created an exclusion process that companies and trade associations could use to request the removal of certain goods from the list of products subject to these increased tariffs, PeopleForBikes and their members sought relief for dozens of products, including electric bicycles, many complete bikes and most components, as well as helmets, lights and other bicycle-related products and accessories.
Unfortunately, the exclusion process is a revolving door, requiring constant vigilance and response. Recently faced with rapidly approaching expiration dates, PeopleForBikes filed dozens more requests asking that the exclusions granted be extended for an additional year. While some were denied, many of the extensions were approved, again saving the bike industry valuable operating capital.
Legal Challenges to List 3 and List 4a
Finally, a series of lawsuits was filed at the Court of International Trade to challenge the legality of the Section 301 tariffs for products included on List 3 and List 4a. These lawsuits argue that the Section 301 tariffs were issued in violation of the Trade Act of 1974 and the Administrative Procedure Act, and request that the List 3 and List 4a tariffs be vacated and repaid with interest. If successful, these cases could provide the opportunity for the bicycle industry to obtain substantial relief from the Section 301 duties. PeopleForBikes did not file a lawsuit, but is closely monitoring the ongoing situation.
While PeopleForBikes is still waiting to see what approach the administration takes with the product exclusions that have been extended through the end of 2020, they are preparing for a busy December with many more exclusion extension requests.
PeopleForBikes is committed to always keeping the industry updated on developments and opportunities to act. To view the current status of exclusions and an in-depth look at Section 301 tariff accomplishments, visit their Section 301 Exclusions webpage.
PeopleForBikes is making biking better for everyone by uniting millions of Americans, thousands of businesses and hundreds of communities to make every bike ride safer, more accessible and more fun. When people ride bikes, great things happen. Join us at PeopleForBikes.org.