On June 2, 2026, the United States Trade Representative (the “USTR”) proposed 10 to 12.5 percent tariffs against 60 economies under Section 301 of the Trade Act of 1974 for “the failure to impose and effectively enforce a prohibition on the importation of goods produced with forced labor.” Specifically, the USTR proposed in the related Federal Register Notice that:
- A 10 percent tariff rate will apply to the following countries / economies with a full or partial mechanism to prohibit the importation of goods with forced labor or a commitment to one in a trade deal with the United States:
- Canada,
- Ecuador,
- the European Union,
- Indonesia,
- Mexico,
- Pakistan
- Argentina,
- Bangladesh,
- Cambodia,
- El Salvador,
- Guatemala,
- Malaysia,
- Taiwan, and
- the United Kingdom
- A 12.5 percent tariff will apply to all other investigated countries, including major trading partners like China, Brazil, India, and Vietnam, for failing to impose any mechanism to prohibit forced labor goods.
The following products are excluded from these proposed actions:
- All products listed in Annex A of the Federal Register Notice;
- All articles and parts of articles that are subject to Section 232 tariffs;
- USMCA-compliant goods of Canada or Mexico;
- Textiles and apparel articles that enter duty-free as a good of Costa Rica, the Dominican Republic, El Salvador, Guatemala, Honduras, or Nicaragua under CAFTA-DR; and
- Informational materials (e.g., books), donations, accompanied baggage.
USTR is establishing a public comment process with respect to these proposed tariffs, inviting comments on the proposed levels of duty rate, whether any specific products should not be subject to the proposed tariffs, whether the proposed exclusions are appropriate, and any other modifications. The relevant dates are as follows:
- June 22, 2026: Request to appear at public hearings (and a summary of testimony) due
- July 6, 2026: Written comments due
- July 7, 2026: USTR hearings
- Five days after the last day of the public hearing: Post-hearing comments due
We noted that in addition to these forced labor investigations, USTR had also initiated parallel Section 301 investigations into the structural excess capacity and production in manufacturing sectors of the following countries / economies: China, the European Union, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan, and India. We expect USTR to release its findings and tariff proposals on these excess capacity investigations in the coming days.
We anticipate the USTR to finalize the tariff actions in July. Companies whose supply chains are being affected by these proposed tariffs should consider participating in the public comment process.
