Three tariff authorities — Section 232, Section 301, and Section 122 — form the backbone of the remedial tariff environment U.S. importers face in 2026. Each derives from a different statute, targets different policy objectives, and covers different products and countries. Understanding which authority applies to a given import is the first step in any tariff analysis and the foundation of any mitigation strategy.
The Key Distinction Before Diving In
Section 232 is a national security tool. Section 301 is an unfair trade practices tool. Section 122 is a balance-of-payments emergency tool. They can and do coexist on the same customs entry — a Chinese steel part might simultaneously owe duties under all three relevant frameworks. Starting with this distinction prevents the common mistake of treating them as alternatives.
Section 232: National Security Tariffs
Section 232 of the Trade Expansion Act of 1962 authorizes the President to impose import restrictions after the Secretary of Commerce and the Bureau of Industry and Security (BIS) of the U.S. Department of Commerce (DOC) investigate and determine that an article is being imported in quantities or under circumstances that threaten to impair national security. BIS evaluates factors including domestic production capacity, the defense industrial base’s requirements, and the impact of imports on those requirements.
Current Section 232 Programs
- Steel articles (HTS Chapters 72-73): 25% ad valorem from most countries. Country-specific tariff-rate quotas (TRQs) exist for Canada, Mexico, the EU, Japan, and others, allowing quota volumes at zero or reduced rates.
- Aluminum articles (HTS Chapter 76): 10% from most countries, with TRQ arrangements for certain allies.
- Copper and copper articles (HTS Chapter 74): 25%, announced in 2025 as part of the expanding national security review of critical minerals.
- Autos and auto parts (HTS Chapter 87, specified subheadings): 25%, with a phase-in for USMCA-qualifying content.
Section 232 does not inherently target a single country. The current programs apply globally with country-specific exceptions negotiated as TRQs. The Federal Register publishes quarterly TRQ fill-rate data. Product exclusions are available for specific HTS subheadings where the product is not available in sufficient quantity, quality, or timeliness from domestic producers. Approved general approved exclusions (GAEs) are available for use by any importer. Working with a tariff consulting firm to identify applicable GAEs or pursue new exclusion requests often delivers measurable duty savings.
Section 232 Process
A Section 232 action requires a formal Commerce Department investigation, a report finding a national security threat, and a Presidential proclamation implementing the remedy. The process is more deliberate than IEEPA because it requires the BIS investigation step. Once proclaimed, Section 232 duties are indefinite.
Section 301: Unfair Trade Practice Tariffs
Section 301 of the Trade Act of 1974 authorizes the Office of the U.S. Trade Representative (USTR) to investigate foreign government acts, policies, and practices that are unreasonable or discriminatory and burden or restrict U.S. commerce, and to take appropriate retaliatory action. Unlike Section 232, Section 301 targets a specific country and a specific set of practices.
Current Section 301 Program: China
The active Section 301 action targets China based on USTR’s 2018 investigation finding that China engages in unfair practices related to technology transfer, intellectual property, and innovation. The tariffs are organized by “List”:
- Lists 1 and 2: 25% on approximately $50 billion in goods (industrial equipment, aerospace components)
- List 3: 25% (raised from 10% in 2019) on approximately $200 billion in goods (consumer electronics, furniture, machinery)
- List 4A: 7.5% on approximately $120 billion in goods (consumer electronics, apparel, footwear)
USTR’s 2024 four-year statutory review resulted in targeted rate increases on strategic categories: electric vehicles (100%), solar cells (50%), lithium batteries (25%), ship-to-shore cranes (25%), and medical gloves (25%).
Section 301 and the Liberation Day IEEPA Stack
Beginning April 2025, the IEEPA Liberation Day rate stacked additively on Section 301 for Chinese goods. For a product subject to 25% Section 301 and 145% IEEPA, the combined remedial tariff is 170%, on top of the applicable MFN rate. Understanding Liberation Day tariffs is therefore inseparable from Section 301 analysis for Chinese-origin goods. See our review of Section 301 tariffs on China for the full product list and rate history.
Section 301 Exclusion Process
USTR has operated rolling exclusion request processes for Section 301. An exclusion removes the tariff for a specific HTS subheading and typically expires after one year. Exclusion requests must demonstrate that the product is not reasonably available from non-Chinese sources or that the tariff causes severe economic harm. The USITC publishes analysis supporting exclusion determinations.
Section 122: Balance-of-Payments Tariffs
Section 122 of the Trade Act of 1974 grants the President authority to impose a temporary import surcharge when the United States is experiencing “large and serious” balance-of-payments deficits or a significant depreciation in the exchange value of the dollar. This authority is less well-known because it has not been formally invoked since 1971 (under President Nixon as part of the Smithsonian Agreement framework). It received renewed attention in 2025 as a possible alternative legal basis for the Liberation Day tariff framework.
Key Constraints of Section 122
- Rate cap: Section 122 limits the surcharge to a maximum of 15%.
- Duration cap: The surcharge can last no more than 150 days without Congressional action.
- Universal application: Section 122 does not allow country-specific differentiation; it applies to all imports equally.
These constraints explain why the Liberation Day framework used IEEPA rather than Section 122. IEEPA has no statutory rate cap, no time limit once an emergency is declared, and allows country-specific rate differentiation — all essential for the Annex II country-specific reciprocal rate structure with rates exceeding 100% for China. The USITC has published comparative analysis of IEEPA and Section 122 scope and limitations for interested parties.
Side-by-Side Comparison
| Feature | Section 232 | Section 301 | Section 122 |
|---|---|---|---|
| Statute | Trade Expansion Act 1962 | Trade Act of 1974 | Trade Act of 1974 |
| Authority | President after DOC/BIS investigation | USTR (President may direct) | President |
| Basis | National security threat | Unfair trade practices | Balance-of-payments deficit |
| Country scope | Global (with country TRQ exceptions) | Country-specific (China currently) | Universal (no country distinction) |
| Product scope | Steel, aluminum, copper, autos | Thousands of HTS codes from China | All imports |
| Rate cap | None statutory | None statutory | 15% maximum |
| Duration | Indefinite until revoked | Indefinite (4-year review cycle) | Maximum 150 days |
| Current status | Active: steel 25%, Al 10%, Cu 25%, autos 25% | Active: 7.5-25%+ on Chinese goods | Inactive (last used 1971) |
Decision Tree: Which Authority Applies?
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- Is the product steel, aluminum, copper, or an auto/auto part? If yes, check for Section 232 applicability and any applicable TRQ for the country of origin.
- Is the country of origin China? If yes, identify the Section 301 List and applicable rate for the specific HTS subheading.
- Does the Liberation Day IEEPA rate apply? It applies to all origins: 10% Annex I for most countries, the applicable Annex II rate (145% for China as of mid-2026) for named countries.
- Is there an active AD/CVD order? Check ITA Enforcement and Compliance for any order covering the specific product and country combination.
The sum of all applicable rates is the effective composite tariff. Use the Captain tariff tracker to run this assessment for any HTS and origin combination. Our trade advisory services team provides authority-by-authority mitigation analysis for importers managing concurrent exposure across multiple programs.
Mitigation Strategies by Authority
Each tariff authority has distinct mitigation pathways:
- Section 232: Product exclusion applications to BIS, reclassification to a non-covered subheading, sourcing from TRQ-exempt country volumes, FTZ use for melted-and-poured origin tracing.
- Section 301: USTR exclusion requests for specific HTS subheadings, First Sale valuation to reduce the dutiable base, drawback on subsequent exports, sourcing diversification to non-China origins.
- IEEPA (Liberation Day): Annex III product-level carve-out monitoring, bilateral deal memo tracking for country rate reductions, FTZ deferral pending exclusion rulings or court decisions.
Frequently Asked Questions
What is the difference between Section 232 and Section 301 tariffs?
Section 232 is a national security tariff under the Trade Expansion Act of 1962, currently applied globally to steel (25%), aluminum (10%), copper (25%), and autos (25%). Section 301 is an unfair trade practices tariff under the Trade Act of 1974, currently applied only to Chinese-origin goods at rates from 7.5% to 25%+. Both can apply to the same entry from China.
Does Section 301 apply to countries other than China?
No active Section 301 orders apply to countries other than China as of mid-2026. While Section 301 can be used against any country, the current action targets China specifically in response to USTR’s 2018 investigation findings on technology transfer and IP practices.
What is Section 122 and why is it not used?
Section 122 authorizes a temporary up-to-15% universal import surcharge for up to 150 days to address balance-of-payments deficits. It has not been formally invoked since 1971. The 15% rate cap and 150-day time limit make it unsuitable for the Liberation Day framework, which required country-specific rates exceeding 100% on an indefinite basis — capabilities IEEPA provides but Section 122 does not.
Can Section 232 and Section 301 both apply to the same Chinese steel shipment?
Yes. A Chinese steel fitting, for example, carries Section 232 (25%), Section 301 (25%), and IEEPA Liberation Day (145%) simultaneously. All applicable rates are calculated on the same customs value and summed. The combined effective rate on some Chinese steel products exceeds 200%.
How do I get a Section 232 product exclusion?
Submit an exclusion request to BIS through the Section 232 exclusion portal. The request must demonstrate that the product is not produced in the U.S. in sufficient quantity, quality, or timeliness. Approved exclusions become General Approved Exclusions (GAEs) available for any importer to use. Monitor the Federal Register for newly published GAEs that may cover your product.
Are Section 301 tariffs permanent?
Section 301 tariffs are indefinite but subject to mandatory four-year statutory review by USTR. Reviews can raise rates, reduce them, add product categories, or terminate the action. The 2024 review raised rates on strategic goods. The next review cycle is expected in 2028.
Authority-Specific Tariff Guidance
With three overlapping authorities and distinct mitigation pathways for each, the most efficient approach is a structured program review. Our tariff consulting team maps every applicable authority for your product portfolio and identifies priority mitigation actions by authority. Trade advisory services from CargoTrans cover Section 232 exclusion applications, Section 301 exclusion strategy, and IEEPA deferral planning.
