DUTY & TRADE UPDATE — SECTION 301
Updated: September 2026
Market: United States
Topic: Section 301 / Forced Labor Trade Measures
The Office of the United States Trade Representative (USTR) has taken final action following Section 301 investigations involving 60 U.S. trading partners and their policies related to imports produced with forced labor.
The action establishes additional Section 301 duties of 10% or 12.5%, depending on the status of the trading partner and other conditions established by USTR. The measures can affect sourcing and landed-cost decisions for companies importing apparel and other products into the United States.
What Changed?
USTR began the investigations in March 2026 and proposed responsive actions in June. Following public comments and hearings, USTR subsequently announced final action.
Under the final action, certain trading partners that have adopted, committed to adopt, or partially implemented forced-labor import prohibitions are subject to a 10% Section 301 duty.
Other investigated economies are generally subject to a 12.5% Section 301 duty, with separate treatment applying to certain products from the European Union, Taiwan, Japan, Korea, and Switzerland.
Product exemptions also apply, meaning the additional duty should not be assumed to apply uniformly to every imported product.
Why This Matters for Apparel Sourcing
For apparel importers, an additional tariff can materially change landed cost even when the factory FOB price remains unchanged.
A sourcing decision that appeared competitive based on FOB price alone may produce a different result after duty, freight, and other import costs are included.
This makes it increasingly important to evaluate sourcing decisions using total landed cost rather than factory price alone.
Apparel companies should also avoid assuming that one tariff percentage applies automatically to every product from a particular sourcing country. The applicable HTS classification, country of origin, product exemptions, and current U.S. trade measures should be checked before finalizing costing.
Key Apparel Sourcing Considerations
For apparel sourcing and production teams, the practical questions are:
Country of Origin — Which country legally qualifies as the origin of the garment?
HTS Classification — What U.S. tariff classification applies to the product?
Existing Duty — What normal duty already applies to that classification?
Additional Trade Measures — Does a Section 301 or other additional tariff apply?
Product Exemptions — Is the product specifically excluded from the additional measure?
Landed Cost Impact — How does the final duty structure affect the actual delivered cost of the garment?
These questions should be reviewed before a sourcing decision is finalized—not after production has already been committed.
Kevin’s Production Note
In apparel sourcing, factory price and actual sourcing cost are not the same thing.
A lower FOB quotation can lose its cost advantage once duty, freight, and other landed-cost components are included. When trade policy changes, existing costing assumptions should therefore be reviewed before confirming new production or shifting volume between sourcing countries.
The practical comparison should always be based on the final landed cost and production risk together, rather than FOB price alone.
Source & Reference
This update is based on official information published by the Office of the United States Trade Representative (USTR) regarding its Section 301 investigations and final responsive action concerning forced-labor import policies among major U.S. trading partners.
Because tariff treatment can depend on the country, HTS classification, exemptions, and subsequent government actions, importers should verify the current applicable requirements before making commercial or customs decisions.