Section 201

(U.S.) Section 201, the “escape clause” provision of the Trade Act of 1974, permits temporary import relief, not to exceed a maximum of eight years, to a domestic industry which is seriously injured, or threatened with serious injury, due to increased imports. Import relief, granted at the president’s discretion, generally takes the form of increased tariffs or quantitative restrictions. To be eligible for section 201 relief, the International Trade Commission (ITC) must determine that: (1) the industry has been seriously injured or threatened to be injured and (2) imports have been a substantial cause (not less than any other cause) of that injury. Industries need not prove that an unfair trade practice exists, as is necessary under the antidumping and countervailing duty laws. However, under section 201, a greater degree of injury–“serious” injury– must be found to exist, and imports must be a “substantial” cause (defined as not less than any other cause) of that injury.
If the ITC finding is affirmative, the president’s remedy may be a tariff increase, quantitative restrictions, or orderly marketing agreements. At the conclusion of any relief action, the Commission must report on the effectiveness of the relief action in facilitating the positive adjustment of the domestic industry to import competition. If the decision is made not to grant relief, the president must provide an explanation to the Congress. See escape clause; unfair trade advantage; orderly marketing agreements; adjustment assistance; International Trade Administration. See quantitative restrictions; International Trade Commission.

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