Goods Shipped Through Third Countries, Including Thailand, Under Scrutiny
PUBLISHED: 6 Mar 2025 at 09:00
WASHINGTON – U.S. businesses are calling for stricter legislation to reinforce trade laws and ensure the prosecution of companies benefiting from Chinese government subsidies that exploit tariffs by routing goods through third countries. Executives from mid-sized industrial firms, including manufacturers of steel pipes and household items, urged lawmakers on Capitol Hill that the U.S. is losing vital tariff revenue and that American companies face increasing competition from Chinese firms manipulating trade regulations.
Even when U.S. companies have succeeded in legal challenges, they argue that enforcement funding is insufficient, allowing Chinese companies to exploit loopholes. “We’ve had to close factories, cut jobs, and decrease investment due to unfair competition,” stated an executive from a notable U.S. pipe manufacturer.
“The imports do not come directly from China, but rather via countries like Oman, Thailand, Vietnam, and the UAE—significant importers of subsidized hot-rolled steel from China,” the executive added.
Another CEO, representing a family-run business with a long-standing history, emphasized that their company has battled against illegal trade practices related to China for decades, with limited relief from past cases.
During discussions with bipartisan lawmakers, industry leaders expressed support for a new bill aimed at enhancing the prosecution of trade violations, known as the Protecting American Industry and Labor from International Trade Crimes Act.
The reintroduction of this legislation follows alarming rhetoric regarding a potential new tariff war involving multiple nations. Business leaders conveyed their concerns that without stronger enforcement mechanisms, tariff evasion through third countries will persist.
One industry representative highlighted that American factories have closed not due to inability to compete but because enforcement failed to protect them. She illustrated a scenario where significant investments were made to combat trade violations, only for goods to reroute through multiple Southeast Asian countries to avoid tariffs.
Industry leaders reiterated the necessity for a robust enforcement system that includes not just fines but also criminal penalties for violators.
