USTR Just Opened Section 301 Investigations on 16 Countries. Your Sourcing Plan Is About to Break.
On March 11, 2026, USTR launched Section 301 investigations into 16 economies including Vietnam, Cambodia, and Bangladesh. Here's what FBA importers need to know.
If you spent the last two years moving production out of China, this article is for you.
On March 11, 2026, the Office of the US Trade Representative (USTR) opened Section 301 investigations into 16 economies. The shortlist reads like every "China+1" sourcing playbook ever written: Vietnam, Cambodia, Thailand, Indonesia, Malaysia, Bangladesh, India, Mexico, plus China itself, the EU, Korea, Taiwan, Singapore, Switzerland, Norway, and Japan. The headline: "structural excess capacity and production in manufacturing sectors." The plain English: USTR thinks too many of your suppliers are subsidized, and they're getting ready to do something about it.
So if you've been sleeping easy because you switched your phone case production from Shenzhen to Ho Chi Minh City, or your kitchenware to Phnom Penh, or your apparel to Dhaka. You should probably stop.
What Section 301 actually is
Section 301 of the Trade Act of 1974 is the legal authority that gave us the original China tariffs in 2018. It lets USTR investigate "unfair" foreign trade practices and impose tariffs as a remedy. The 2018 investigation found that China was forcing US companies to hand over technology to do business there, and the response was four lists of additional tariffs (Lists 1 through 4A) that still apply today on most Chinese imports.
The point is: Section 301 isn't a China-specific tool. It can target any country. It just happened that the China case was by far the largest action ever taken under it.
The new March 2026 investigations are the second-largest. They cover roughly two-thirds of US imports by value.
If you want the full breakdown of how Section 301 fits into the broader duty stack alongside MFN, Section 232, and Section 122, we wrote a complete walkthrough of how US import duties stack.
What USTR is investigating
Two parallel investigations were announced on March 11.
Investigation 1: Excess manufacturing capacity. Targets 16 economies. USTR alleges that government subsidies and industrial policy in these countries have created production capacity far above what their domestic markets can absorb, leading to dumping into the US market. The 16: China, the EU, Singapore, Switzerland, Norway, Indonesia, Malaysia, Cambodia, Thailand, Korea, Vietnam, Taiwan, Bangladesh, Mexico, Japan, India.
Investigation 2: Forced labor enforcement. Targets 60+ economies. USTR is examining whether countries have adequately enforced prohibitions on goods made with forced labor. The list of countries criticized for inadequate enforcement includes Canada, Mexico, and the EU.
Both had public comment periods that closed April 15. Hearings were scheduled at the US International Trade Commission for April 28 (forced labor) and May 5 (excess capacity).
USTR Ambassador Greer has publicly signaled an "accelerated timeline" to wrap these up. The reason is simple: the Section 122 global surcharge expires July 24, 2026, and the administration wants Section 301 tariffs ready to fill the gap.
Why this is worse than IEEPA was
The Supreme Court struck down IEEPA tariffs in February 2026 because IEEPA wasn't designed for tariffs. Section 122 has hard limits: 15% rate cap, 150-day duration, must apply globally and uniformly. Both got the administration only so far.
Section 301 is the legally durable replacement, and it's worse for importers in three ways.
No rate cap. The original China tariffs hit 25% on Lists 1, 2, and 3. There's no statutory ceiling. The administration could set 30%, 40%, or higher.
No time limit. Section 122 expires after 150 days. Section 301 tariffs imposed in 2018 are still in effect today, more than seven years later. They become the new baseline.
Country-specific rates. Unlike Section 122's "broad and uniform" requirement, Section 301 lets USTR set different rates for different countries based on the severity of the unfair practice. So Vietnam might get 20%. Cambodia 25%. Bangladesh 30%. The administration gets to pick.
Legal analysts expect the resulting tariffs to look similar to the country-specific IEEPA rates that were struck down. Which means Vietnam, Cambodia, and Bangladesh, the three biggest "China+1" beneficiaries of the last decade, are looking at potential rates in the 20% to 40% range.
The math for FBA importers
Here's a worked example for a $5.00 FOB silicone phone case sourced from Vietnam, with a 3.4% MFN rate.
Today (March 2026), under Section 122:
- MFN duty: 3.4% = $0.17
- Section 301: does not apply (Vietnam isn't currently subject)
- Section 122: 10% = $0.50
- Total duties: $0.67 per unit
After July 24, 2026, if Section 122 expires and Section 301 replaces it at a 25% rate on Vietnam:
- MFN duty: 3.4% = $0.17
- Section 301 (Vietnam): 25% = $1.25
- Section 122: $0.00 (expired)
- Total duties: $1.42 per unit
That's a $0.75 per unit increase. On a 10,000-unit shipment, $7,500. On annual volume of 100,000 units, $75,000.
If you priced your product based on current duties and built a 12-month inventory plan around Vietnam sourcing, that math just changed.
You can model the before/after for your specific products in MarginStack's calculator, which lets you toggle Section 122 on and off and adjust country-specific rates.
What this means right now
A few practical points to think through over the next 90 days.
The 150-day countdown is real. Section 122 ends July 24, 2026. The President can't extend it unilaterally. Congress hasn't moved on extension legislation, and bipartisan support is doubtful. Plan for the 10% being the floor, not the ceiling, of your 2026 tariff exposure. We laid out the three possible scenarios and the practical decisions to make in the next 90 days in our Section 122 expiration countdown article.
Country diversification within the investigation list won't help. If 16 economies covering most of Asia and the EU are all under investigation, switching from Vietnam to Cambodia to Indonesia is rearranging deck chairs. The countries that aren't on the list (most of Africa, Latin America outside Mexico, parts of Central Asia) typically don't have the manufacturing infrastructure for FBA-grade product.
Watch for product-specific exclusions. The original Section 301 actions included an exclusion process where importers could petition for relief on specific HS codes. There are currently around 178 active exclusions on the China lists, extended through November 10, 2026. New investigations will likely follow the same playbook. Track USTR.gov for exclusion announcements relevant to your HS code.
Get your records straight on Section 122. A separate lawsuit is challenging Section 122 itself at the Court of International Trade. If it succeeds, importers who paid Section 122 from February 24 onward could be eligible for refunds, similar to the IEEPA refund process. Make sure your customs broker is recording Section 122 as a distinct line item on your entries. We covered this in our SCOTUS IEEPA ruling analysis.
Recalculate your margins on multiple scenarios. The single biggest mistake right now is pricing as if the current rate environment will hold. Run your numbers at three rates: today's Section 122 (10%), the high-end forecast (25-40% Section 301 on your sourcing country), and the optimistic case (Section 122 expires, no Section 301 yet, just MFN). If any of those scenarios kills the product, you have a decision to make in the next 90 days.
The uncomfortable truth about China+1
The China+1 strategy worked for one specific reason. Section 301 hit China, and other countries weren't subject to it. Vietnam in particular became a darling because most consumer goods got the MFN rate and nothing else. That's why factories there expanded so fast. That's also exactly why USTR is now investigating Vietnam.
Excess capacity in Vietnam, Cambodia, and Bangladesh isn't a coincidence. It was the predictable outcome of US importers shifting production there to dodge the China tariffs. The administration's argument is that those countries' subsidies enabled the capacity buildup, which is the "structural excess capacity" they're investigating now.
Whether you find that argument convincing or not isn't the point. The point is that the legal mechanism is moving, the timeline is short, and the rates won't be capped at 15% anymore.
The sellers who handled the 2018 China tariffs best weren't the ones who got lucky. They were the ones who modeled the cost impact early, made decisions before their competitors, and got out ahead of the deadlines. Same playbook applies now.
If your sourcing plan assumes Vietnam stays cheap forever, run the numbers again.