U.S. launches fresh Section 301 probes into 60 economies over forced-labor trade practices

The U.S. on Thursday launched new trade investigations into 60 economies to determine if they have failed to curb imports of goods made with forced labor, a day after it initiated unfair trade practices probe into 16 partners.

The new investigations, conducted under Section 301(b) of the Trade Act of 1974, include China, the European Union, India and Mexico, according to a statement from the United States Trade Representative.

“Despite the international consensus against forced labor, governments have failed to impose and effectively enforce measures banning goods produced with forced labor from entering their markets,” U.S. Trade Representative Jamieson Greer said.

“These investigations will determine whether foreign governments have taken sufficient steps to prohibit the importation of goods produced with forced labor and how the failure to eradicate these abhorrent practices impacts U.S. workers and businesses,” he said.  

Section 301 permits the U.S. to impose tariffs on countries found to have engaged in unfair trade practices without additional congressional authorization — legal authority that U.S. President Donald Trump had used during his first term to levy duties on Chinese goods.

The forced-labor probes follow Section 301 investigations launched on Wednesday, which targeted excess industrial capacity across 16 economies, including China, Australia, Indonesia, Japan, Malaysia, Singapore, South Korea, Switzerland, Thailand.

The latest probes expanded the list of countries under Section 301 scrutiny to include more countries such as the U.K., Brazil and Russia.

The new investigations appear to serve as an alternative route to replace at least some of the “reciprocal tariffs” that the U.S. Supreme Court quashed last month.

“With the strike-down of the reciprocal tariffs, the administration made it clear that their plan-B would be rolled out soonest,” said Wendy Cutler, vice president at Asia Society Policy Institute and a former U.S. trade representative.  

The Supreme Court invalidated Trump’s reciprocal tariffs last month, ruling that the president had exceeded his power. Trump then immediately imposed a 10% global blanket tariff based on Section 122 of the Trade Act 1974, and threatened to raise it further to 15%.

The sweeping scope of the investigations has drawn scrutiny over their feasibility and rationale among trade experts.

The U.S. Trade Representative will hold hearings on the investigations from April 28 to May 1 — an “unrealistically short” timeline given the breadth of countries under scrutiny, said Deborah Elms, head of trade policy at Hinrich Foundation.

Taking aim at European Union, which has enacted its own legislative framework prohibiting forced-labor practices, while sparing countries with significantly weaker enforcement records “does not make sense,” Elms said.

The sweeping breadth of the trade probes also risks alienating partners and squandering the goodwill needed to forge a collective response to address Chinese industrial overcapacity, according to experts.

“The administration is losing an important opportunity to work with partners to address the real excess capacity problem in the world, [which is] China,” Cutler said.

“By adding more than a dozen countries into an investigation on excess capacity our partners will be in no mood to work with us to address the serious challenges China’s excess capacity is presenting globally,” she added.

The investigations come as U.S. Treasury Secretary Scott Bessent is slated to meet with his Chinese counterpart He Lifeng in Paris this weekend to continue trade and economic talks. The Chinese commerce ministry on Friday confirmed the meeting in Paris from March 14 to March 17.

The meeting is expected to lay the groundwork for a summit between Trump and Chinese President Xi Jinping.

“Launching new trade investigations right before the summit sends the wrong signal,” said Wang Huiyao, founder of the Center for China and Globalization, a think-tank often seen as aligned with Beijing’s thinking.

“Section 301 has been tried before, and what the two sides need now is to find a way to work together — including on what is happening in the Middle East,” he added.

A Chinese commerce ministry spokesperson pushed back against Washington’s framing of its industrial output as excess capacity, calling it “narrow-minded” to treat a gap between domestic production and demand as an unfair trade practice.

The official also urged Washington to “correct their mistakes and return to the right path of resolving issues through diplomatic negotiations.” On the forced-labor issue, China said it was currently assessing the probes, without elaborating.

“China will likely use the upcoming meeting in Paris to express its displeasure,” said Stephen Olson, senior visiting fellow at ISEAS-Yusof Ishak Institute and a former U.S. trade negotiator.

That said, both sides appear committed to keeping the Trump-Xi meeting on track, “I wouldn’t expect this [trade probe] to upset the apple cart,” he added.

The first Trump administration launched six Section 301 investigations, with probes into China and the European Union resulting in tariff hikes. The Biden administration also carried out Section 301 investigations, and two probes into Brazil and China remain ongoing.