Following a request from the President on May 23, the U.S. Department of Commerce initiated a vast investigation to determine the effects on national security of imports of automobiles — including not only cars but SUVs, vans and light trucks — in addition to automotive parts.
The Secretary of Commerce initiated this investigation under Section 232 of the Trade Expansion Act of 1962,1 a once-obscure statute that has gained notoriety since its initial use by the Trump Administration 12 months ago. Section 232 authorizes Commerce to investigate whether products are being imported “in such quantities, or under such circumstances as to threaten to impair the national security.”2 Importantly, “national security” is defined expansively to include not only the military and national defense but also “the economic welfare of the Nation.”3
If an affirmative finding is made, the President is authorized to “adjust” imports of the products, and those “adjustments” may include actions such as tariffs, quotas, negotiated agreements with foreign governments and other important restrictions. The new investigation of imported automobiles and auto parts follows proceedings against a broad range of steel and aluminum imports, which led to the imposition of tariffs at the rate of 25 percent and 10 percent, respectively.
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