US Investigates China's Compliance with 2020 Trade Agreement
US Investigates China's Compliance with 2020 Trade Agreement
The US Trade Representative (USTR) has launched a new investigation under Section 301 to examine whether China is fulfilling its obligations under the "Phase One Agreement" signed in 2020.
The investigation will assess whether China is breaching its commitments on intellectual property (IP), forced technology transfer, agriculture, and financial services.
This move comes at a time when US–China trade relations are entering a period of renewed tension.
Trump Administration Revisits 2020 Agreement
According to the Federal Register notice issued by USTR on October 24, 2025, the investigation aims to determine whether US rights under the agreement have been violated.
In response to China's conduct, retaliatory actions such as new tariffs or import restrictions may also be considered.
This process is intended to review the implementation of the trade agreement signed in January 2020 during President Donald Trump's first term.
The agreement was implemented following the trade war of 2018–2019 with the goal of partially reducing tariffs and increasing bilateral trade.
Key Provisions of the Phase One Agreement
Under the 2020 agreement:
The US agreed to reduce tariffs on $120 billion worth of products imported from China.
China, based on 2017 data, committed to additional imports of $217 billion from the US.
In return, the US maintained Section 301 tariffs on other products.
China also pledged to reduce tariffs on 850 different products and increase global imports.
However, according to USTR's new assessment, China fell short of its import target from the US at $200 billion.
This figure shows that the import volume China committed to was largely not realized.
USTR: "China Failed to Meet Commitments"
USTR's statement included the following remarks:
"Despite all diplomatic contacts with China over the past five years,
China has failed to fulfill its commitments in the areas of Intellectual Property, forced technology transfer, agriculture, and financial services."
In this context, USTR will determine whether US trade interests have been harmed by China's practices that contravene the agreement's provisions.
Investigation Process: Public Participation Call
USTR will hold a public hearing on December 16, 2025 as part of the investigation.
The public comment period begins on October 31,
Comments and hearing participation requests will be accepted through December 1.
Participants will be able to provide information on how China has implemented its commitments in the agreement and offer recommendations to the Trump administration on measures that should be taken.
New Wave of Tension: Pressure Escalates Following Tariff Ceasefire
This investigation creates new tension in US–China trade relations following a temporary tariff ceasefire signed in the spring.
Both sides had agreed to halt tariff increases, but disagreements persist over implementation and import commitments.
The Trump administration's move is also seen as a harbinger of a new round of trade negotiations with China.
The White House confirmed that President Trump and Chinese President Xi Jinping will meet in South Korea next week.
Analysis: US Enters New "Section 301" Pressure Cycle
Section 301 investigations are one of the mechanisms that give the US the authority to impose unilateral sanctions against unfair trade practices.
This mechanism was also the legal basis for the 2018 trade war.
According to experts:
The new investigation is part of the Trump administration's strategy to increase economic pressure on China.
China's failure to meet import commitments could pave the way for renewed tariff increases.
For US companies, this situation signals a new period of uncertainty in supply chain planning.
Key Points:
The US Trade Representative (USTR) is reviewing China's compliance with the 2020 Phase One Trade Agreement under a Section 301 investigation.
China fell short of its import target from the US at $200 billion.
The investigation may result in retaliatory steps including new tariffs and trade restrictions.
The public hearing is scheduled for December 16, 2025, with the comment period running October 31–December 1.
This move could trigger a new wave of tension in US–China relations following the tariff ceasefire.
Experts point out that this investigation signals the Trump administration's renewed pressure campaign against China.
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News Link: https://www.supplychaindive.com/news/us-china-2020-trade-deal-section-301-investigation/803772/
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