United States Imposes Additional Tariffs on All Imports From China, Additional Tariffs on Canada and Mexico Paused for
One Month

On February 1, 2025, President Donald J. Trump signed three executive orders announcing the imposition of additional tariffs on products of Canada, Mexico, and China. The executive order on Canada provides an additional tariff of 25% on all “products of Canada” except for “energy or energy resources,” which are subject to an additional 10% tariff. The executive order on Mexico provides an additional tariff of 25% on all “products of Mexico.” The executive order on China provides an additional tariff of 10% on all “products of the PRC.” The orders each reference definitions being included in forthcoming Federal Register notices, which will include Chapter 99 subheadings added to the Harmonized Tariff Schedule of the United States to facilitate the implementation of the tariffs by U.S. Customs and Border Protection (CBP).¹

I. Summary of Key Points and Takeaways From the Executive Orders

 The additional tariffs on China went into effect Tuesday, February 4, 2025 (i.e., “goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern time on February 4, 2025”). There is a limited “in transit” exception for articles loaded or in transit before February 1 but that arrive February 4 or later, provided that the importer makes certain certifications to CBP. The additional tariffs on Canada and Mexico were scheduled to go into effect on February 4, 2025, but were suspended for one month following phone calls between President Trump and the leaders of those two countries.

The orders do not provide for an exclusion process. This means, for the time being, there is no mechanism for companies to seek exclusions from the additional tariffs.

These tariffs are in addition to any tariffs currently in place (e.g., the existing Section 301 tariffs that apply to China-origin articles).

Drawback cannot be claimed on these additional tariffs.

Articles covered by the orders are not eligible for de minimis entry.

The orders also each contain an anti-retaliation (i.e., an escalation) clause. If a country retaliates against products of the United States, the orders state that the “President may increase or expand in scope the duties imposed under this order to ensure the efficacy of this action.” China has announced that it will impose retaliatory tariffs.

These additional tariffs are likely to remain in place until President Trump terminates them (e.g., based on a negotiated resolution). The tariffs are being imposed under the International Emergency Economic Powers Act (IEPPA) based on President Trump’s declaration of a national emergency. Under IEPPA, the President is supposed to have consulted with Congress “before exercising” the declaring a national emergency and is required, once the emergency is declared, to “immediately transmit to Congress” a report explaining his actions. Congress can terminate the national emergency by a joint resolution. Under the National Emergencies Act (NEA), each chamber must consider a vote on a joint resolution terminating the emergency within six months of the President’s declaration. If not terminated by joint resolution, or by the President, the NEA provides that the national emergency shall terminate one year from the declaration unless the President publishes a notice in the Federal Register, and notifies Congress, that the emergency is to continue in the 90-day period before the termination. Given the current makeup of Congress, it is unlikely that a joint resolution terminating these national emergencies will pass.

II. Tariffs on Other Countries and Products Likely Forthcoming

 On January 31, 2025, while speaking with reporters in the Oval Office, President Trump extolled the virtue of tariffs and made clear that the recent actions on Canada, Mexico, and China are just the first tranche of additional U.S. tariffs.

President Trump stated that he intends to impose additional tariffs on imports from the European Union. Specifically, when asked whether he is going to impose tariffs on the EU, he answered “absolutely.”

In addition, he said he intends to impose tariffs on a number of other products (from anywhere). He said he intends to put additional tariffs on imported semiconductors (“chips and things associated with chips”); oil and gas; steel and aluminum; copper; and pharmaceuticals. With regard to oil and gas, he said he was targeting February 18. With regard to steel and aluminum, the tariffs would be imposed “this month or next” (February or March) and that the tariffs on copper would “take longer.” With regard to pharmaceuticals, he did not provide a date but was clear that he wants to bring production back to the United States and that the best way to do that is to “put up a tariff wall.”

Companies that import products into the United States from China should be considering mitigation strategies. Companies that import products into the United States from Canada and Mexico should be analyzing how they stand to be affected if the now-suspended tariffs are ultimately imposed after the one-month pause. For example, companies should confirm that they are using the correct legal standard to determine the country of origin of articles imported from Canada, Mexico, and China. The United States uses a subjective, fact-dependent version of the “substantial transformation” test to determine the country of origin of imported articles; this test is governed by court decisions and administrative rulings issued over many years and, therefore, is not necessarily straightforward to apply, particularly with respect to products that undergo production in multiple countries and/or incorporate inputs from multiple countries.

More broadly, the rapidly changing developments over the past few days highlight the need for companies to be prepared for the imposition of tariffs. All companies that rely on imports into the United States should be taking steps to understand their supply chains and identify potential alternative sources of supply so that they can react quickly if/when tariffs are imposed.

¹ A White House fact sheet explaining these actions is available here.