USTR had targeted July 20, 2026 as the point by which it hoped to have final action ready on two of the three Section 301 tracks built to backstop the expiring Section 122 tariff: the 60-economy forced-labor investigation and the 16-economy structural excess-capacity investigation. As of this writing, neither has been finalized or published in the Federal Register. Only the separate, single-country Brazil action (see our companion article) has reached a final rate.
Forced-Labor Tariffs: Comment Period Closed, No Final Action Yet
USTR’s June 2, 2026 determination found all 60 investigated economies — accounting for roughly 99% of U.S. import volume — actionable for failing to adequately prohibit or enforce bans on forced-labor goods. The proposed remedy is a 10% additional tariff on 15 economies that have taken steps toward compliance, and 12.5% on the remaining 45. Written comments closed July 6, the public hearing ran July 7–9, and post-hearing rebuttal comments were due five days after the hearings concluded. That full record is now closed, and USTR is free to finalize, modify, or withdraw the proposal at any time — but no notice of final action has been published as of today.
Structural Excess Capacity: Investigation Still Open
The second track, initiated March 11, 2026 against 16 economies including China, the EU, Vietnam, Korea, Japan, and India, examines whether persistent trade surpluses or underutilized manufacturing capacity burden or restrict U.S. commerce. USTR set July 24 as its own informal target for completing this investigation and being prepared to impose tariffs, timed to align with Section 122’s expiration — but the initiation notice did not invoke any procedure to formally expedite the standard investigation timeline, and no affirmative determination has been published yet.
Why the Timing Gap Matters
Section 122’s 10% global surcharge expires by statute at 12:01 a.m. EDT on July 24, 2026, regardless of whether either Section 301 replacement is ready. If final action on either track publishes between now and July 24, the effective date and any transition treatment for goods already in transit become critical operational questions. If neither is ready by July 24, importers could see a period where the Section 122 surcharge has lapsed and no replacement duty has yet taken its place for the affected countries — though Section 232 and existing China-specific Section 301 tariffs would be unaffected either way.
Action Items for Importers
- Monitor the Federal Register daily between now and July 24 for final action on either the forced-labor or structural excess-capacity investigations.
- Model your landed costs under both the 10%/12.5% forced-labor scenario and a scenario where Section 122 simply lapses with no immediate replacement for your sourcing countries.
- Keep the Brazil action’s July 22 effective date separate in your planning — it is final and unrelated to these two pending tracks.
- Confirm whether USMCA-qualifying goods retain their existing exemption treatment once any replacement action is finalized.
ASK ALBA™: Want help modeling your exposure across all three active Section 301 tracks at once? Contact our trade compliance team.
References
USTR: Findings and Proposed Action in 60 Section 301 Forced Labor Investigations (June 2, 2026)
