Background on Section 232 Investigations – Section 232 investigations, administered by the U.S. Commerce Department, are conducted to determine the effect of imports of certain goods on national security Historically, Section 232 investigations have been conducted regarding U.S. imports of crude oil and petroleum products and uranium, among other critical imports.
Investigations may be initiated based on an application from an interested party, a request from the head of any department or agency, or may be self-initiated by the Secretary of Commerce. The Secretary’s report to the President, prepared within 270 days of initiation, focuses on whether the importation of the article in question is in such quantities, or under such circumstances, that threaten to impair the national security. The President can concur or not with the Secretary’s recommendations, and take action to “adjust the imports of an article and its derivatives” or other non-trade related actions as deemed necessary.
BIS Publishes Report on Uranium Imports’ Threat to National Security
In July 2021, the U.S. Commerce Department’s Bureau of Industry & Security (“BIS”) published a report on the U.S. reliance on uranium imports entitled The Effect of Imports of Uranium on National Security. Although the investigation was concluded and the report was finalized on April 14, 2019, the report was only released to the public in July 2021 and published on the Federal Register on August 2, 2021.
As required by law, the U.S. Secretary of Commerce considered all required statutory factors in making its determination, including:
- Domestic production needed for projected national defense requirements
- The capacity of domestic industries to meet such requirements
- Existing and anticipated availabilities of the human resources, products, raw materials, and other supplies and services essential to the national defense
- The requirements of growth of such industries and such supplies and services including the investment, exploration, and development necessary to assure such growth; and
- The importation of goods in terms of their quantities, availabilities, character, and use as those affect such industries; and the capacity of the United States to meet national security requirements
The U.S. Secretary of Commerce found that present quantities and circumstances of uranium imports are “weakening our internal economy” and “threaten to impair the national security” as defined in Section 232. Furthermore, the Secretary found that the closures of the few remaining U.S. uranium mining, milling, and conversion facilities are anticipated within the next few years. Further decreases in U.S. uranium production and capacity, including domestic fuel fabrication, will cause even higher levels of U.S. dependence on imports, especially from Russia, Kazakhstan, Uzbekistan, and China. Increased imports from State-Owned Enterprises (“SOEs”) in those countries, and in particular Russia and China present a direct challenge to U.S. influence, are detrimental to the national security.
Accordingly, the Secretary recommends the following:
- In order to remove the threat of impairment to national security, it is necessary to reduce imports of uranium to a level that enables U.S. uranium producers to return to an economically competitive and financially viable position.
- The President ought to take immediate action by adjusting the level of uranium imports through the implementation of an import waiver to achieve a phased-in reduction of uranium imports.
At the time of this writing, it is unclear how President Biden will respond to the findings and recommendations in the report. Diaz Trade Law will monitor and keep our readers up to date.