President Trump signed an executive order on February 1, 2025, imposing an additional 10% ad valorem tariff on all articles that are products of the People’s Republic of China, effective 12:01 a.m. eastern time on February 4, 2025. The order invokes the International Emergency Economic Powers Act and the National Emergencies Act, expanding the scope of the national emergency declared in Proclamation 10886 to cover the PRC government’s failure to arrest, seize, detain, or intercept chemical precursor suppliers, money launderers, transnational criminal organizations, and drugs. Goods already loaded onto a vessel or in transit before 12:01 a.m. eastern time on February 1, 2025 are exempt, provided the importer certifies to U.S. Customs and Border Protection.
What it means
The order applies the 10% duty to all PRC-origin goods entered for consumption or withdrawn from warehouse on or after February 4, 2025, with no duty-free de minimis treatment available under 19 U.S.C. 1321 and no drawback permitted. PRC articles admitted into U.S. foreign trade zones on or after that date must be admitted as “privileged foreign status” as defined in 19 CFR 146.41. The Secretary of Homeland Security is directed to modify the Harmonized Tariff Schedule of the United States via Federal Register notice to carry out the order. If the PRC retaliates with import duties or similar measures, the order authorizes the President to increase or expand the scope of duties imposed.
The order states that the CCP subsidized and incentivized PRC chemical companies to export fentanyl and related precursor chemicals, that the PRC provides support and safe haven to PRC-origin transnational criminal organizations that launder revenues from illicit synthetic opioid production and sale, and that PRC-based companies use re-shippers in the United States, false invoices, fraudulent postage, and deceptive packaging to conceal drug shipments. The order further states that PRC-origin transnational criminal organizations coordinate and communicate using PRC social media software applications. The action cites authority under IEEPA, the NEA, section 604 of the Trade Act of 1974, section 301 of title 3 U.S. Code, and section 1702(a)(1)(B) of IEEPA, and references the Presidential Memorandum of January 20, 2025 on America First Trade Policy, Proclamation 10886, and Executive Order 14157 designating cartels as foreign terrorist organizations.
Key facts
- Tariff rate: additional 10% ad valorem on all PRC-origin articles
- Effective date: 12:01 a.m. eastern time, February 4, 2025
- Transit exemption: goods loaded or in transit before 12:01 a.m. eastern time, February 1, 2025, with CBP certification
- De minimis treatment under 19 U.S.C. 1321 is not available for articles subject to this order; no drawback permitted
- Foreign trade zone entries on or after February 4, 2025 must be admitted as “privileged foreign status” per 19 CFR 146.41
- Approximately 200 Americans killed per day by synthetic opioids, according to the order
- Synthetic opioid overdose is the leading cause of death for Americans aged 18 to 45, according to the order
- 75,000 deaths per year attributed to fentanyl, according to the order
- 500,000+ pounds of drugs seized at the southern border each of the last 3 fiscal years; 42,000+ pounds seized at the northern border on average each year over the last 3 years
Source: Executive Order, “Imposing Duties to Address the Synthetic Opioid Supply Chain in the People’s Republic of China,” issued by President Donald J. Trump (whitehouse.gov)