White House Releases Findings of Section 301 Investigations into Forced Labor Import Policies; Brazil

This week the Trump administration took significant steps towards using Section 301 of the Trade Act of 1974 to reimpose significant tariffs on the majority of U.S. trading partners as well as heighted tariffs on Brazil.

On June 2, the U.S. Trade Representative (USTR) released the findings of its Section 301 investigation into 60 economies related to their failure to impose and effectively enforce prohibitions on goods produced by forced labor. The 60 economies under investigation represent 99.40% of U.S. imports. USTR proposed imposing a 12.5% tariff on 54 of the countries targeted, while the remaining six would receive 10% tariffs.

The proposed tariffs would not apply to goods subject to tariffs imposed under Section 232 of the Trade Expansion Act of 1962. The United States-Mexico-Canada Agreement (USMCA)-compliant goods of Canada and Mexico would also be exempt. Textiles and apparel that enter duty-free under the Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua free trade agreement (CAFTA-DR) would also be exempt. An appendix lists additional exemptions.

USTR is widely expected to finalize these tariffs prior to July 24, 2026, when a 10% global tariff imposed under Section 122 of the Trade Act is set to expire.

A day earlier, on June 1, USTR released the findings of its Section 301 investigation into Brazil. The report found that Brazil maintains several unreasonable policies and practices across areas, including digital trade and electronic payment services, preferential tariff treatment, intellectual property protection and illegal deforestation, each of which poses an unreasonable burden to U.S. commerce.

USTR proposes to impose a 25% tariff on imports from Brazil as a result of this investigation. It appears that this tariff is intended to “stack” on the 12.5% tariff proposed under the forced labor imports investigation for a cumulative rate of 37.5%. The proposed tariffs would not apply to goods subject to tariffs imposed under Section 232 of the Trade Expansion Act of 1962. An appendix lists additional exemptions.

Both actions provide opportunities for public comment and scheduled public hearings in early July. USTR continues to conduct several additional investigations under Section 301, including into structural excess manufacturing capacity in 16 countries. These investigations could result in additional tariffs.

This alert provides further analysis, including how these proposed Section 301 tariffs compare to those previously imposed under the International Emergency Economic Powers Act (IEEPA), on a country-by-country basis.

Background

Section 301 of the 1974 Trade Act authorizes USTR to investigate whether an act, policy, or practice of a foreign country either “violates, or is inconsistent with, the provisions of, or otherwise denies benefits to the United States under, any trade agreement” or “is unjustifiable and burdens or restricts United States commerce.” This investigation can be triggered by USTR itself or by petitions from outside parties. If USTR determines a country has engaged in unfair or unreasonable practices, the statute provides broad authority to impose tariffs and other punitive trade measures.

Forced Labor Report Findings

USTR held confidential consultations with the majority of countries under investigation to determine the existence and efficacy of policies meant to combat forced labor goods. The trade agency also hosted public comment periods and public hearings to gather stakeholder feedback from U.S. businesses, foreign companies and consumers. U.S. companies highlighted the negative impact that forced labor inputs have on U.S. competitiveness in global markets. Following these consultations and internal investigation, USTR produced a report, which found that all 60 countries failed to effectively combat forced labor. The report divides covered countries into two categories:

1. Economies that failed to impose a legal prohibition on the importation of goods produced wholly or in part with forced labor and to effectively enforce such a prohibition:
   • Algeria; Angola; Argentina; Australia; The Bahamas; Bahrain; Bangladesh; Brazil; Cambodia; Chile; China, People’s Republic of; Colombia; Costa Rica; Dominican Republic; Egypt; El Salvador; Guatemala; Guyana; Honduras; Hong Kong, China; India; Iraq; Israel; Japan; Jordan; Kazakhstan; Kuwait; Libya; Malaysia; Morocco; New Zealand; Nicaragua; Nigeria; Norway; Oman; Peru; the Philippines; Qatar; Russia; Saudi Arabia; Singapore; South Africa; South Korea; Sri Lanka; Switzerland; Taiwan; Thailand; Trinidad and Tobago; Türkiye; United Arab Emirates; United Kingdom; Uruguay; Venezuela; and Vietnam.
2. Economies that failed to effectively enforce a forced labor import prohibition:
   • Canada; Ecuador; the European Union; Indonesia; Mexico; and Pakistan.

Based on the findings of the investigation, and reflecting a perceived failure to combat and enforce forced labor prohibitions, all countries under investigation are now subject to potential tariff and non-tariff punitive trade measures in retaliation for the unreasonable burden on the U.S. economy imposed by their failure to combat forced labor inputs.

Forced Labor Initial Determination

Following the completion of its report, the USTR released an initial determination recommending the imposition of tariffs ranging from 10%‒12.5% on affected countries. The tariff burden faced by each country depends on its efforts to combat forced labor imports and the status of trade agreements with the United States:

1. 10% tariff for economies that
   • Impose a forced labor prohibition:
     • Canada; Ecuador; the European Union; Indonesia; Mexico; and Pakistan.
   • Imposed a partial regime to prevent the importation of forced labor goods:
     • The United Kingdom.
2. Have undertaken commitments in their respective Agreements on Reciprocal Trade with the United States to combat forced labor imports:
   • Argentina; Bangladesh; Cambodia; Ecuador; El Salvador; Guatemala; Indonesia; Malaysia; and Taiwan.
3. 12.5% tariff for all other countries under investigation:
   • Algeria; Angola; Australia; The Bahamas; Bahrain; Brazil; Chile; China; Colombia; Costa Rica; Dominican Republic; Egypt; Guyana; Honduras; Hong Kong; India; Iraq; Israel; Japan; Jordan; Kazakhstan; Kuwait; Libya; Morocco; New Zealand; Nicaragua; Nigeria; Norway; Oman; Peru; the Philippines; Qatar; Russia; Saudi Arabia; Singapore; South Africa; South Korea; Sri Lanka; Switzerland; Thailand; Trinidad and Tobago; Türkiye; United Arab Emirates; Uruguay; Venezuela; and Vietnam.

The notice also creates an annex (Annex A) of goods exempt from the tariffs. All goods subject to tariffs under Section 232 are exempt from the proposed Section 301 forced labor tariffs. USMCA-compliant goods of Canada and Mexico are also exempt. Textiles and apparel that enter duty-free under the Costa Rica, Dominican Republic, El Salvador, Guatemala, Honduras and Nicaragua free trade agreement (CAFTA-DR) are also exempt. Several other general carve-outs are included in Annex A:

1. Raw materials that, if subject to the proposed additional tariffs, could lead to the unavailability of domestic supply; and
2. Products that could cause economy-wide disruptions if subject to the proposed tariffs; and
3. Products that cannot be grown or produced in sufficient quantities in the United States or obtained from other sources; and
4. Goods for which additional tariffs may not contribute substantially to the elimination of forced labor practices; and
5. Informational materials, such as books, donations and accompanied baggage.

Brazil Investigation Findings

USTR held confidential consultations with the Brazilian government, including a formal consultation session on April 15 and 16, 2026, to discuss the acts, policies and practices under investigation. The trade agency also hosted public comment periods and a public hearing on Sept. 3, 2025, receiving testimony from over 30 witnesses and more than 295 comments and rebuttal comments. Following these consultations and internal investigation, USTR produced a report which found that Brazil maintains six categories of unreasonable acts, policies and practices that burden or restrict U.S. commerce:

1. Digital Trade and Electronic Payment Services: Brazilian courts have issued secret orders directing U.S. social media companies, including X (Twitter), Meta and Google, to remove political content and suspend user profiles while prohibiting platforms from disclosing these orders to affected users. Courts have imposed significant financial penalties for noncompliance, including asset freezes and payment processing restrictions. Brazil has also unfairly advantaged its national electronic payment system, Pix, over competing U.S. payment services providers through mandatory participation requirements, prominent display mandates and fee caps that apply only to Pix.
2. Unfair, Preferential Tariffs: Brazil maintains partial-scope preferential trade arrangements with Mexico and India, granting lower tariff rates across more than a thousand tariff lines for Mexico and hundreds for India. These rates are between 10% and 100% below the most-favored-nation (MFN) rate applied to U.S. exports in the same sectors.
3. Anti-Corruption Enforcement: Brazil has failed to take sufficient enforcement action to combat bribery and corruption. In 2025, Transparency International scored Brazil at 35 out of 100 on its Corruption Perceptions Index, ranking it 107 out of 180 countries and well below the global average of 43.
4. Intellectual Property Protection: Brazil has been on USTR’s Special 301 Watch List since 2007. Ongoing concerns include insufficient enforcement against counterfeit goods and a failure to carry out consistent anti-piracy enforcement measures.
5. Ethanol Market Access: Brazil abruptly reimposed tariffs on U.S. ethanol in 2017 following a period of bilateral cooperation and has maintained tariffs at 18% since February 2023. Brazilian ethanol continues to benefit from relatively open U.S. market access.
6. Illegal Deforestation: Despite maintaining a legal framework to combat illegal deforestation, Brazil has failed to effectively enforce it. Products grown on illegally deforested land enter U.S. and global markets at artificially lower costs, undermining the competitiveness of U.S. agricultural and timber producers.

Brazil Initial Determination

Following the completion of its investigation, USTR released an initial determination recommending the imposition of a 25% tariff on Brazilian goods. The notice also creates an annex of goods exempt from the tariffs. All goods subject to tariffs under Section 232 are exempt from the proposed Section 301 tariffs. Several other general carve-outs are included in the annex:

1. Raw materials that, if subject to the proposed additional tariffs, could lead to the unavailability of domestic supply; and
2. Products that could cause economy-wide disruptions if subject to the proposed tariffs; and
3. Products that cannot be grown or produced in sufficient quantities in the United States or obtained from other sources; and
4. Goods for which additional tariffs may not contribute substantially to the elimination of Brazil’s acts, policies and practices described above; and
5. Informational materials, such as books, donations and accompanied baggage.

Implications

The initial determinations released by USTR recommend, rather than impose, additional tariffs to address Brazil’s unreasonable policies and countries’ failure to address forced labor inputs. Before imposing new tariffs, USTR must now hold public hearings and open submissions for public comments to gather additional stakeholder feedback on the proposed actions. This second consultation process allows stakeholders to argue for or against the proposed tariff burden, the list of goods exempt from the proposed tariffs, and the mechanism for imposing tariffs. It also provides affected countries the opportunity to engage in further negotiations with the Trump administration regarding their exposure.

Whether the final tariff action mirrors USTR’s initial recommendation depends heavily on this public consultation process, as well as bilateral negotiations that covered countries pursue in the interim. Previous Section 301 determinations provide a useful example. In January 2026, USTR released the final determination of its Section 301 investigation into Nicaragua’s acts, policies and practices related to labor rights, human rights and the rule of law. The administration imposed a phased-in tariff approach rather than immediately applying the proposed rate, setting the tariff at 0% beginning Jan. 1, 2026, rising to 10% on Jan. 1, 2027, and reaching 15% on Jan. 1, 2028.

The administration has identified Section 301 as the primary vehicle for recreating the country-specific tariff burden briefly established under the International Emergency Economic Powers Act (IEEPA), but on a more durable legal footing. USTR Jamieson Greer and other trade officials have indicated that these investigations are designed to rebuild the tariff leverage lost following the Supreme Court’s February 2026 decision invalidating IEEPA tariffs. The Section 122 global tariff of 10% that replaced IEEPA is a temporary stopgap set to expire on July 24, 2026. With that expiration approaching, the Brazil and forced labor investigations represent the first major wave of a broader Section 301 regime intended to recreate the country-specific tariff structure built under IEEPA, but on a statutory foundation that is significantly harder to challenge in court. For a comprehensive table comparing the tariff burden faced by covered countries under IEEPA compared to the Section 301 investigations into Brazil and forced labor practices, please see the chart at the end of this alert.

Next Steps

Forced Labor Investigation

USTR will hold a public comment submission period and public hearings. Requests to appear at the public hearings must be submitted by June 22. Written comments must be submitted by July 6. USTR’s Section 301 Committee will convene public hearings starting at 10:00 a.m. on July 7, with additional hearings held as necessary. Post-hearing rebuttal comments are due five days after the final hearing is held. The docket for requests to appear at the hearings can be found here, while the docket for public comments can be found here.

Brazil

USTR will hold a public comment submission period and public hearings. Requests to appear at the public hearings must be submitted by June 22. Written comments must be submitted by July 1. USTR will convene public hearings starting on July 6, which may continue to the next business day if necessary. The docket for requests to appear at the hearings can be found here, while the docket for public comments can be found here.

Moving Forward

Brownstein stands ready to assist impacted stakeholders in navigating this second consultation process and managing associated risks from the incoming final determination. Our team can help assess and respond to issues such as:

• Preparing and engaging public comments, hearing appearances and hearing rebuttals;
• Creating end-to-end Section 301 strategies—helping clients advocate for preferred tariff policies while leveraging trade enforcement tools to impose tariffs on competing imports and strengthen market position.
• Conducting tariff impact assessments on supply chains, including forced labor audits and exposure assessments across the six categories USTR mentioned that burden or restrict U.S. commerce, under attorney-client privilege;
• Assessing exposure and developing response strategies for clients in sectors particularly affected by the Brazil determination, including digital services, agriculture, ethanol and timber;
• Understanding tariff exemption or carve-out mechanisms available to priority goods and products according to the annexes in each notice;
• Developing risk-mitigation strategies, such as tariff engineering, country-of-origin reviews or leveraging existing Free Trade Agreements; and
• Understanding existing documentation of forced labor in targeted countries.

For additional insights into the Trump administration’s trade agenda or assistance in navigating this rapidly evolving environment, please contact a member of the Brownstein team.

Appendix

Country	Final IEEPA Rate (Blocked by Supreme Court)	Proposed Tariff Under “Forced Labor Imports” Section 301 Investigation
Algeria	30%	12.5%
Angola	15%	12.5%
Argentina	10%*	10%
Australia	10%	12.5%
Bahamas	10%	12.5%
Bangladesh	19%*	10%
Brazil	50% (10% IEEPA “baseline” + 40% Brazil IEEPA)	12.5% (+25% Brazil 301)
Cambodia	19%*	10%
Canada	35% (35% fentanyl IEEPA, 10% for energy and potash)(USMCA exemptions)	10% (USMCA exemptions)
Chile	10%	12.5%
China	20%* (10% IEEPA baseline + 10% fentanyl IEEPA)	12.5%
Colombia	10%	12.5%
Costa Rica	15%	12.5% (CAFTA-DR exemptions)
Dominican Republic	10%	12.5% (CAFTA-DR exemptions)
Ecuador	15%*	10%
Egypt	10%	12.5%
El Salvador	10%*	10% (CAFTA-DR exemptions)
European Union	0%-15%*	10%
Guatemala	10%	10% (CAFTA-DR exemptions)
Guyana	15%	12.5%
Honduras	10%	12.5% (CAFTA-DR exemptions)
Hong Kong	10%	12.5%
India	18%*	12.5%
Indonesia	19%*	10%
Iraq	35%	12.5%
Israel	15%	12.5%
Japan	15%*	12.5%
Jordan	15%	12.5%
Kazakhstan	25%	12.5%
Kuwait	10%	12.5%
Libya	30%	12.5%
Malaysia	19%*	10%
Mexico	25% (USMCA exemptions)	10% (USMCA exemptions)
Morocco	10%	12.5%
New Zealand	15%	12.5%
Nicaragua	18%	12.5% (CAFTA-DR exemptions)
Nigeria	15%	12.5%
Norway	15%	12.5%
Oman	10%	12.5%
Pakistan	19%	10%
Peru	10%	12.5%
Philippines	19%*	12.5%
Qatar	10%	12.5%
Saudi Arabia	10%	12.5%
Singapore	10%	12.5%
South Africa	30%	12.5%
South Korea	15%*	12.5%
Sri Lanka	20%	12.5%
Switzerland	15%*	12.5%
Taiwan	20%*	10%
Thailand	19%*	12.5%
Trinidad and Tobago	15%	12.5%
Türkiye	15%	12.5%
UAE	10%	12.5%
United Kingdom	10%*	10%
Uruguay	10%	12.5%
Venezuela	15%	12.5%
Vietnam	20%*	12.5%

* Countries that reached bilateral trade agreements or framework agreements to lower tariffs