Swiss government: expected that additional tariffs may be imposed as a result of the Section 301 investigations into overcapacity

The U.S. Trade Representative (USTR) has initiated Section 301 investigations into structural excess capacity and production in manufacturing sectors across multiple economies, including Switzerland. These investigations aim to determine whether the policies and practices of these countries are unreasonable or discriminatory and whether burden or restrict U.S. commerce. The USTR has identified Switzerland as one of the economies exhibiting structural excess capacity, particularly in pharmaceuticals, machinery, and refined gold.

As part of these investigations, the USTR has requested consultations with the Swiss government and is seeking public comments and testimony to evaluate the extent of the issue. The findings from these investigations could lead to the imposition of additional tariffs on Swiss exports to the United States. Specifically, the USTR has proposed a 12.5% additional tariff on products from economies that have not imposed or effectively enforced a prohibition on the importation of goods produced with forced labor.

Switzerland has been categorized among 54 economies lacking a clear ban on such imports. The Swiss State Secretariat for Economic Affairs (SECO) has rejected these allegations, emphasizing that forced labor is prohibited under Swiss constitutional, civil, and criminal law. SECO has also highlighted Switzerland's leadership in international efforts to combat forced labor, including its inclusion of such a ban in public procurement legislation.

The USTR’s investigations are part of a broader effort to address global trade imbalances and unfair trade practices. The U.S. government argues that structural excess capacity undermines U.S. competitiveness in key manufacturing sectors and distorts global market conditions. If the USTR determines that Switzerland’s policies are actionable under Section 301, it could face additional tariffs on its exports, which may impact its trade relationship with the United States.

Public comments on the proposed actions are due by July 6, 2026, and hearings will be held on July 7, 2026. The outcome of these proceedings will have significant implications for Swiss exporters and the broader transatlantic trade relationship.