The Presidential Proclamation on the restriction of steel imports, under Section 232, provided that any country with which the United States has a security relationship may seek to discuss “alternative ways to address the threatened impairment of the national security caused by imports from that country.” If a “satisfactory alternative” is reached, the President may modify or remove the tariffs on imports from that country.

Several countries are already in discussions with the administration seeking exemption, including Australia, Brazil, Japan and the European Union. Early reports indicate that Australia may be the first in line to receive a country exemption. Unlike the product exclusion process, for which a time-limit was identified to establish a process, no such formal requirements were laid out with respect to the country exemption process.

The following are the criteria under which Country Exemption may be considered:

• “A security relationship” with the United States – the term “security relationship” is undefined.
• Whether the country seeking exclusion protects its home market from underpriced imports.
• The country’s level of support for US positions in trade remedy cases at the World Trade Organization (WTO).
• The country’s participation in the Organization for Economic Cooperation and Development (OECD) forum on steel overcapacity.
• Bilateral steel and aluminum trade patterns with the country in question

A country seeking an exemption must offer “satisfactory alternative means” of eliminating the threat to US national security posed by that country’s exports.