Trump Administration Launches New Trade Investigations Targeting Excess Capacity and Forced Labor

WASHINGTON – The Trump administration has initiated a series of trade investigations under Section 301 of the Trade Act of 1974, targeting both excess industrial capacity and the employ of forced labor in the supply chains of numerous countries. The move comes after the Supreme Court struck down some of President Trump’s previous tariffs in February.

Investigations into Excess Industrial Capacity

The U.S. Trade Representative (USTR) Jamieson Greer announced investigations into “structural excess capacity” in the European Union, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, South Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan, and India. This refers to manufacturing output exceeding reasonable domestic consumption levels. According to Greer, such capacity can lead to suppressed domestic wages and sustained barriers to market access.

Greer emphasized that the announcement is “just an initiation” and that the U.S. Expects to “articulate with even more precision some of the challenges” facing American industries due to this excess capacity .

Focus on Forced Labor

In a separate initiative, the administration will launch Section 301 investigations into approximately 60 trading partner countries to ensure they prohibit the import of goods produced with forced labor. Greer indicated these investigations will be conducted on a country-specific basis.

Section 301 and Potential Tariffs

Section 301 of the Trade Act of 1974 allows the USTR to unilaterally retaliate against countries deemed to have imposed unfair trade barriers against the U.S. The law requires an investigation into a country’s trade practices before any retaliatory measures, such as tariffs, can be imposed.

Broader Trade Strategy

The Trump administration is seeking to replace potential revenue lost after the Supreme Court ruling on previous tariffs. While the existing trade deals with many of these countries are considered “independent” of these investigations, the administration is prepared to utilize various tools to protect American jobs and address unfair trade practices. Greer also suggested potential future investigations into issues like digital service taxes, pharmaceutical drug pricing, and ocean pollution.