Highlights
- China announced its third round of retaliatory actions on April 4, 2025, including a 34 percent additional tariff on all U.S. goods, effective April 10, 2025. This move is in response to the 34 percent International Emergency Economic Powers Act (IEEPA) reciprocal tariff on Chinese imports announced on April 2, 2025.
- China's non-tariff countermeasures include new export restrictions on rare earth materials, adding U.S. defense and tech firms to the Export Control List and Unreliable Entity List, initiating an antidumping investigation and suspending imports of certain U.S. agricultural products from specific U.S. exporters.
- Earlier rounds of retaliation included targeted tariffs on U.S. energy, agriculture and industrial goods, export restrictions on critical minerals, the addition of U.S. companies to the Export Control List and Unreliable Entity List, initiation of an antitrust investigation and an anti-circumvention investigation of an existing antidumping duty order, and suspension of imports of certain U.S. agricultural products – all implemented in early February and March 2025.
- China also filed formal complaints with the World Trade Organization, challenging the legality of the U.S. tariff measures following each of the three tariff actions taken by the U.S.
Update: In response to China's 34 percent retaliatory tariffs, President Donald Trump increased the 34 percent reciprocal tariffs on China to 84 percent, effective April 9, 2025. In response, the Chinese government issued a series of new countermeasures on April 9, 2025:
- Tariff Increase: China raised its retaliatory tariff rate on U.S.-origin goods from 34 percent to 84 percent, effective April 10, 2025, at 12:01 p.m. (Beijing time). This change amends the previous measure dated April 4, 2025, while all other provisions remain in effect.
- Export Control List: China designated 12 additional U.S. entities under the Export Control List, prohibiting the export of dual-use items to these companies, effective April 10, 2025, at 12:01 p.m. (Beijing time).
- Unreliable Entity List: China added six U.S. entities to its Unreliable Entity List, banning them from engaging in import/export activities with China or making new investments in China, effective April 10, 2025, at 12:01 p.m. (Beijing time).
In response to China's increased retaliatory measures, on April 9, 2025, President Trump threatened to raise tariffs on China to 125 percent.
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China on April 4, 2025, announced a third and significantly escalated round of retaliatory measures in response to the United States' latest tariff action. This follows President Donald Trump's Executive Order (EO) 14257 issued on April 2, 2025, which imposed a country-specific reciprocal tariff regime under the International Emergency Economic Powers Act (IEEPA). Under this action, all imports from China are subject to an additional 34 percent tariff. In parallel with the tariff announcement, China unveiled a series of non-tariff measures, including new export restrictions, additions to a trade sanction list, import suspensions and government investigations.
China's response is the most comprehensive to date. It builds on two prior rounds of countermeasures issued after the U.S. first imposed a 10 percent fentanyl IEEPA tariff on Chinese goods in February 2025, which was then increased to 20 percent in March 2025. China filed formal complaints with the World Trade Organization (WTO), challenging the legality of the U.S. tariff measures following each of the three tariff actions taken by the U.S.
Summary of China's Retaliation Measures
China's Retaliation Measures
| Feb. 4, 2025 | March 4, 2025 | April 4, 2025 | April 9, 2025 | Total | ||
|---|---|---|---|---|---|---|
| Tariff | 10%-15% | 10%-15% | 34% | Additional 50% (84% in total) | Up to 99% | |
| Export Control | Item | 5 critical minerals | / | 7 rare earth minerals | / | 12 critical minerals |
| Company | / | 15 companies | 16 companies | 12 companies | 43 companies | |
| Unreliable Entity List | 2 companies | 10 companies | 11 companies | 6 companies | 29 companies | |
| Enforcement Actions | Google antitrust investigation | Optical fiber antidumping circumvention investigation | CT X-ray tubes antidumping investigation | / | 3 investigations | |
| Import Suspensions | / | Logs (any exporter), soybeans (3 exporters) | Sorghum, bone meal, poultry (6 exporters) | / | Multiple agricultural products, over 9 exporters affected | |
China Retaliatory Tariff
| Feb. 4, 2025 | March 4, 2025 | April 4, 2025 | April 9, 2025 | Total | |
|---|---|---|---|---|---|
| Coal and Liquefied Natural Gas (LNG)*1 | 15% | / | 34% | Additional 50% (84% in total) |
99% |
| Oil and Agricultural Machinery* | 10% | / | 94% | ||
| Poultry and Wheat**2 | / | 15% | 99% | ||
| Soybeans and Pork** | / | 10% | 94% | ||
| Other Imports | / | / | 84% |
China's Recent (Third) Retaliation Measures on April 4, 2025
Tariffs
As the central component of this third round, China will apply an additional 34 percent tariff on all goods imported from the U.S., effective at 12:01 p.m. on April 10, 2025. This new duty is levied on top of existing tariff rates.
- While China's existing bonded and duty-reduction programs remain in effect, the new tariff will not be eligible for any exemptions or relief.
- A transitional exemption applies to goods that departed their port of export before 12:01 p.m. on April 10, 2025, and are imported into China by May 13, 2025.
Export Control on Seven Types of Rare Earth Materials
As part of its strategic response, China introduced new export licensing requirements for seven types of medium and heavy rare earth elements – samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium – along with their associated compounds, oxides, alloys, mixtures and products. These materials are essential for manufacturing electronics, defense systems and clean energy technologies.
Chinese exporters must now apply for licenses through the Ministry of Commerce, and shipments are subject to classification and declaration rules at customs. This move expands China's export control regime under the Export Control Law and reflects the government's tightening control over supply chains critical to national security. (For further insights, see Holland & Knight's previous alert, "China Imposes Export Controls on Medium and Heavy Rare Earth Materials," April 4, 2025.)
Adding 16 U.S. Entities to Export Control List
China has added 16 U.S. entities to its Export Control List, which prohibits the export of items from China that have both civil and military applications. Any ongoing related exports must cease immediately. The entities added include aerospace contractors, logistics firms, defense suppliers and dual-use technology companies.
Under China's Export Control Law and the Dual-Use Item Export Control Regulations, the list targets foreign importers and end-users deemed to pose risks to China's national security or violate end user or end-use requirements. Companies on the list are subject to restrictions or prohibitions on receiving dual-use goods, technologies or services from China.
Adding 11 U.S. Entities to the Unreliable Entity List
China has added 11 U.S. companies to its Unreliable Entity List, banning them from engaging in import and export activities with China and prohibiting new investments in the country, effective immediately. Among the designated companies are several U.S.-based drone and defense technology firms. The inclusion of these companies reflects China's growing focus on unmanned systems and related technologies with perceived national security implications.
The Unreliable Entity List, launched by China's Ministry of Commerce, is a regulatory tool used to penalize foreign entities and individuals deemed to endanger China's national sovereignty, security or development interests. It also targets those who interrupt normal transactions with Chinese entities or individuals or take discriminatory measures against them, thereby endangering their legitimate rights and interests. Under the Provisions on the Unreliable Entity List, entities or individuals on the list may face restrictions on trade, investment, entry of personnel and transportation vehicles, visa issuance and penalties.
Antidumping Investigation on CT Medical Tubes
On April 4, 2025, China's Ministry of Commerce initiated an antidumping investigation3 into imports of certain X-ray tube assemblies and tube inserts used in medical computed tomography (CT) scanners originating from the U.S. and India. This follows a formal petition submitted by a Chinese medical device manufacturer alleging that these imports are being sold at unfairly low prices and have caused material injury to China's domestic industry. The scope of the investigation includes X-ray tubes and tube inserts driven by ball bearings to rotate the anode target disk at high speed, suitable for 16-slice and above CT equipment. The Harmonized Tariff Schedule (HTS) code is 90223000.
The antidumping review covers imports made between Jan. 1, 2024, and Dec. 31, 2024. The domestic industry injury assessment extends from Jan. 1, 2022, through Dec. 31, 2024. The investigation is expected to conclude by April 4, 2026, though it may be extended for six months if necessary.
Suspending Qualifications of Six U.S. Companies on Agricultural Imports
China has suspended the qualifications of six U.S. companies to export sorghum, poultry meat and bone meal, and poultry products to China due to violations of China's food safety law and import quarantine requirements related to plants, animals, crops and feed. The suspensions are effective immediately.
- Customs authorities suspended shipments of sorghum and poultry bone meal after detecting excessive levels of zearalenone, mold and salmonella contamination. Consequently, import qualifications for four U.S. suppliers were suspended.
- In a separate action, authorities found residues of banned veterinary drugs in U.S. poultry shipments. As a result, imports from two U.S. poultry exporters have also been suspended.
China's Second Retaliatory Measures on March 4, 2025
Following the Trump Administration's escalation of tariff measures – raising the across-the-board tariff on Chinese imports from 10 percent to 20 percent on March 3, 2025 – China announced a second round of retaliatory actions on March 4, 2025, targeting key sectors of U.S. exports.
- Tariffs. China imposed an additional 15 percent duty on agricultural products – including chicken, wheat, corn and cotton – and an additional 10 percent tariff on a broader list of agricultural and food products such as soybeans, sorghum, pork, beef, seafood, fruit, vegetables and dairy, covering more than 700 tariff lines. These tariffs took effect on March 10, 2025.
- Export Control List. The Ministry of Commerce introduced export control restrictions on 15 U.S. defense-related companies, barring Chinese suppliers from providing them dual-use items. These measures target companies involved in aerospace, military technology and supply chain intelligence.
- Unreliable Entity List. China added 10 U.S. companies to its Unreliable Entity List, prohibiting these entities from engaging in trade with and making new investment in China. In addition, imports of gene sequencing equipment from a previously designated company were formally banned on March 4, 2025.
- Anti-Circumvention Investigation of Antidumping Measures. Trade enforcement expanded further with the launch of an investigation into the circumvention of the antidumping duty order on U.S. optical fiber products. Chinese domestic industry alleged that certain exporters altered product specifications to evade long-standing antidumping duties in place since 2011. This marks the first anti-circumvention investigation in China's history.
- Import Suspensions. China Customs suspended import qualifications for three U.S. soybean exporters and suspended imports of U.S. logs. This action targeted three soybean producers whose shipments were found to contain contaminants such as ergot and seed treatment residues and U.S. log exporters due to the detection of harmful forestry pests. These suspensions were issued under China's Food Safety Law, Biosecurity Law and Quarantine Law and were effective immediately.
China's First Retaliatory Measures on Feb. 4, 2025
In response to President Trump's EO issued on Feb. 1, 2025 – imposing a blanket 10 percent tariff on all Chinese imports under the IEEPA and citing the fentanyl crisis – China launched its first round of countermeasures targeting both trade and investment channels on Feb. 4, 2025.
- Tariffs. China imposed additional duties of 15 percent on U.S. coal and LNG products and 10 percent on crude oil, agricultural machinery and various types of large vehicles and trailers, which became effective on Feb. 10, 2025. These tariffs affect a range of strategic sectors, including energy, transportation and food production, and apply across 80 tariff lines under China's 2025 Tariff Schedule.
- Export Control. China expanded its export control regime to cover a broader range of critical minerals. New licensing restrictions were introduced on exports of materials such as tungsten, tellurium, bismuth, molybdenum and indium – all key inputs for advanced electronics and high-tech manufacturing. These restrictions build on earlier measures targeting gallium, a material already subject to controls since December 2024.
- Unreliable Entity List. China also invoked its Unreliable Entity List framework to restrict trade and investment activities of two U.S. companies. The designations cited conduct deemed harmful to the legitimate interests of Chinese enterprises, including discriminatory practices and competitive concerns in sensitive sectors such as biotechnology and retail.
- Antitrust Investigation. China's antitrust regulator initiated an investigation into a major U.S. technology company, marking an extension of retaliatory actions into regulatory domains.
Continued Analysis
The Trump Administration has indicated its China strategy is focused on reducing the scope of bilateral trade, seeking greater balance and ensuring trade is limited to nonsensitive products and technologies. Absent high-level discussions to avert further escalation, clients should expect continued uncertainty in the bilateral relationship.
Holland & Knight attorneys and professionals are continuing their analysis of these and other trade development and their impact on client operations. For more information or questions, please contact the authors or another member of Holland & Knight's Tariff Task Force.
Footnotes
1. Effective Feb. 10, 2025, a 15 percent additional tariff on U.S. imports of anthracite, coal, coke, lignite and LNG falling under eight tariff lines of China's 2025 Tariff Schedule (see Annex 1); and a 10 percent additional tariff on U.S. imports of crude oil, various types of agricultural machinery, tractors, large displacement vehicles and pickup trucks, electric wagons, agricultural trailers and semi-trailers falling under 72 tariff lines (see Annex 2).
2. Effective March 10, 2025, a 15 percent additional tariff on U.S. imports of chicken, wheat, corn and cotton falling under 29 tariff lines of China's 2025 Tariff Schedule (see Annex 1) and a 10 percent additional tariff on U.S. imports of sorghum, soybeans, pork, beef, aquatic products, fruits, vegetables and dairy products (among others) falling under 711 tariff lines (see Annex 2).
3. On April 4, 2025, China's Ministry of Commerce initiated an industry competitiveness investigation on imported medical CT tubes, marking the first such investigation at the request of domestic industries. This factual investigation does not target specific countries or regions and does not affect normal trade.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
