Section 122 Tariffs Expired: New Section 301 Duties on 60 Countries Now in Effect

July 25, 2026

The 10% Section 122 surcharge had been the defining feature of US trade policy since February 24, 2026. Importers planned around it, filed lawsuits over it, and priced products with it baked in. Before the sun came up on July 24, it was gone. But the rate cuts many importers hoped for never materialized. A new tariff regime was already in place.

What Happened, in Order

Section 122 of the Trade Act of 1974 has a hard statutory ceiling: a maximum rate of 15%, a maximum duration of 150 days, and no mechanism for presidential extension. Congress did not vote to extend it. The clock ran out at 12:01 AM EDT on July 24.

The administration, however, had been preparing the replacement for weeks. On July 23, USTR finalized the action it had been building since March — a Section 301 investigation focused on forced labor enforcement across 60 trading partners. The Federal Register notice dropped the morning of July 23. Less than 24 hours later, both regimes operated simultaneously for a matter of minutes before Section 122 lapsed entirely.

The sequence was deliberate. There was never going to be a gap. What changed was the legal authority, the country-specific rates, and critically — the expiration timeline. Section 301 has no sunset clause.

The New Rates by Country Category

Unlike Section 122, which applied a flat 10% to virtually every country, the new Section 301 forced labor tariffs are tiered. Countries are sorted into two groups based on their compliance posture with US forced labor import prohibitions.

10% — Countries with Forced Labor Import Bans (17 economies)

These countries have either enacted domestic legislation prohibiting imports made with forced labor, or have made binding commitments to do so under US-negotiated frameworks.

Country	New Rate
Argentina	10%
Bangladesh	10%
Cambodia	10%
Canada	10% (USMCA-qualifying goods exempt)
Ecuador	10%
El Salvador	10%
Guatemala	10%
Honduras	10%
India	10%
Indonesia	10%
Jordan	10%
Malaysia	10%
Mexico	10% (USMCA-qualifying goods exempt)
Pakistan	10%
Sri Lanka	10%
Trinidad and Tobago	10%
United Kingdom	10%

Special Rates — Major Trade Deal Partners

Five economies with existing US trade frameworks receive rates expressed as net of their MFN base duty, effectively limiting the total tariff impact to a ceiling.

Country / Bloc	Rate Structure
European Union	10% (subject to trade agreement ceiling)
Taiwan	10% net of MFN
Japan	12.5% net of MFN (est.)
South Korea	12.5% net of MFN (est.)
Switzerland	12.5% net of MFN (est.)

12.5% — All Remaining Economies (approx. 38 countries)

Countries not included in the forced labor compliance tier face the higher rate. This group includes most of the world's largest US import sources.

Country	New Rate
China	12.5% (stacks on existing Section 301)
Vietnam	12.5%
Thailand	12.5%
Brazil	12.5%
Russia	12.5%
Turkey	12.5%
Other non-listed	12.5%

Key Exemptions

How Section 301 Forced Labor Differs from Section 122

	Section 122 (expired)	Section 301 Forced Labor (new)
Rate	10% flat, global	10% or 12.5% by country
Duration	150 days max	No expiration date
Rate ceiling	15% statutory max	No ceiling
Legal basis	Balance-of-payments emergency	Forced labor enforcement
USMCA exemption	Yes	Yes
Sec. 232 stacking	No stacking	No stacking
Congressional override	Required to extend	Can be modified by USTR

The absence of a sunset clause is the most consequential difference. Every import decision you make with Section 122 came with a built-in question mark: what happens July 24? That uncertainty is now replaced with a permanent framework — one that USTR can adjust through investigation findings, but that carries no automatic expiration.

Impact on Major Import Categories

China: Already Complex, Now More So

China is the only country where the new tariff unambiguously adds to an already heavy burden. The existing Section 301 China tariffs — ranging from 7.5% to 100% by product — remain fully in force. The new 12.5% forced labor rate stacks on top. On consumer electronics from China, the effective rate moves from approximately 35% to roughly 37.5%. On apparel, already at 43%+, it pushes past 55%.

Vietnam and Southeast Asia: Slight Increase, No Expiration

Vietnam, Thailand, and Cambodia move from 10% (Section 122) to 12.5% (Section 301 forced labor). That's a 2.5-point increase — material on high-volume imports. More significantly, these countries no longer benefit from the certainty that Section 122 would expire and potentially disappear. The 12.5% rate is now the indefinite baseline.

Cambodia and Indonesia, however, landed in the 10% tier thanks to their forced labor import prohibition frameworks — slightly better than Vietnam's 12.5%.

Canada and Mexico: No Change for USMCA Goods

USMCA-compliant goods from Canada and Mexico remain exempt, exactly as under Section 122. Non-USMCA goods face 10%. The key caveat: Section 338 tariffs of 50% on certain Canadian goods are scheduled to take effect August 19, 2026 — a separate action with significant exposure for specific product categories.

European Union: Trade Deal Ceiling Holds

The EU's existing trade framework with the US effectively caps total tariff exposure at 15% on most goods, limiting the practical impact of the new 10% forced labor rate on European imports.

Consumers and E-Commerce

Chinese e-commerce platforms — Temu, AliExpress, and Shein — now operate under a combined effective rate that pushes past 50% on most consumer goods. The 48% effective rate that had applied under Section 122 moves to approximately 50.5% under the new stacking structure. As we predicted in our expiration analysis, the transition was seamless at the customs border — no reprieve.

What Importers Need to Do Right Now

1. Verify your country-specific rate in the Federal Register. The USTR notice lists every affected HTSUS subheading and rate by country. Confirm your products aren't in the 471 excluded subheadings before recalculating costs.
2. Update your cost models. For Vietnam, Thailand, and most Southeast Asian suppliers, rates went up 2.5 points. For China, they went up 2.5 points on top of existing Section 301. Every landed cost estimate prepared before July 25 needs revision.
3. Preserve Section 122 import records. Duties paid between February 24 and July 24, 2026 remain eligible for potential refund if the CIT appeal yields a favorable ruling. That litigation is still active. Keep every entry summary and CBP filing from that period.
4. Monitor the Section 301 "manufacturing overcapacity" investigation. A separate, ongoing Section 301 action targeting 16 economies for industrial overcapacity could layer additional tariffs on top of the forced labor rates. This investigation opened in March 2026 and results are expected before year-end.

The Bigger Picture

The Section 122-to-Section 301 handoff was not just an administrative transition. It represents a structural shift in how the US uses tariff authority. Section 122 was emergency law — a blunt instrument with hard limits designed to be temporary. Section 301 is enforcement law — it can be targeted, it can be raised, and it doesn't expire. The administration has moved from a tool that the courts could challenge on procedural grounds to one with 50 years of precedent behind it.

For importers, the practical implications are clear: there is no longer a natural reset point on the horizon. Planning for tariff exposure isn't a 90-day exercise anymore. The new regime invites a longer-term rethinking of supply chains — which is almost certainly the policy intent.