The Fortnight in Brief
USTR's Section 301 forced labor hearing convenes this morning at the US International Trade Commission in Washington. Vietnam is one of 60 economies under investigation for failing to prohibit forced-labor imports, and USTR placed it in the 12.5% additional-duty tier -- the highest in the group. Written comments closed yesterday (docket USTR-2026-0265); today's session (docket USTR-2026-0266) is the last scheduled public input before USTR sets a final rate. Most exposed: textiles, electronics, solar, and seafood.
Vietnam and the European Free Trade Association -- Switzerland, Norway, Iceland, and Liechtenstein -- concluded free trade negotiations on July 2. The deal took almost 14 years: talks opened in 2012, stalled in 2018, restarted last September for five negotiating rounds in Geneva, and closed at a June 22 ministerial in Reykjavík. 2025 bilateral trade was worth €4.8 billion, with a €2.5 billion surplus in Vietnam's favor. Signing is expected this autumn; the treaty text isn't public yet. For exporters watching the US tariff drama, Vietnam has other doors opening -- Swiss pharmaceutical and machinery buyers and Norwegian seafood importers among them -- even if the preferential access this agreement offers is still a signature and a ratification away from applying to a shipment.
Seafood exports reached $5.8 billion in the first half of 2026, up 11% year on year, with VASEP tracking toward a $12 billion full-year target. June alone brought in roughly $1.1 billion, up 21% -- but VASEP's leadership has flagged that the US order surge may reflect importers stocking up ahead of tariff changes rather than a durable recovery. More in Market Signals.
Commerce's final anti-dumping and countervailing duty determination on Vietnamese hardwood and decorative plywood is expected within weeks. Preliminary rates ran as high as 196.14% in anti-dumping duties plus up to 26.75% in countervailing duties (Federal Register 2026-04002); CBP has been collecting at those levels since March.
Vietnam's economy grew 8.39% in the second quarter, up from 7.94% in Q1 and lifting first-half growth to 8.18% (GSO data, reported by The Star). Exports of goods and services climbed 20.18% year on year, though imports grew faster still, at 26.44%. The US remained the largest single export market at $86.5 billion in the first half. The takeaway for anyone deciding whether to keep sourcing from Vietnam through the current tariff uncertainty: the underlying economy is accelerating while Washington and Hanoi sort out the rate.
Policy Watch: What today's hearing actually decides
The last hearing before a final number
USTR's June 2 forced labor determination scored 60 economies on how well they prohibit and enforce against forced-labor imports. Vietnam scored 12.5% -- the highest tier, shared with dozens of other economies also proposed at that rate. The comment period closed yesterday under docket USTR-2026-0265; today's hearing, docket USTR-2026-0266, is the administration's last scheduled opportunity to hear from industry before it finalizes a number. Vietnamese trade associations, US importers of Vietnamese goods, and their trading partners were all eligible to file, and in Section 301 proceedings final rates can move from what was proposed based on the record built this week.
Two deadlines, one date: July 24
The 10% Section 122 surcharge that's applied to Vietnamese goods since late February has had a rough few months in court. The Court of International Trade ruled it unlawful on May 7; the Federal Circuit stayed that ruling on June 11, meaning CBP keeps collecting the duty while the appeal plays out (Section 122 tariffs hold, Mallory Group). None of that changes the statutory endpoint: Section 122 expires by operation of law at 12:01 AM Eastern on July 24, 150 days after it took effect February 24. Importers have paid close to $25 billion in Section 122 duties since then -- a figure that shows up consistently across trade counsel tracking the case and in the American Action Forum's independent tariff-cost modeling (AAF) -- and that bill keeps running until something replaces it (Section 122 surcharge sunsets July 24, Nakachi Eckhardt & Jacobson).
That successor is Section 301. The timing isn't coincidental: Dorsey notes that "the hearing date in July 2026 appears to closely track the expiration date of the current Section 122 tariff action" and would "provide continuity," while the American Action Forum states the pending Section 301 actions "will likely result in tariffs to replace the Section 122 tariff regime expiring on July 24." Gibson Dunn and Tradlinx describe the same handoff independently. One trade-law alert goes further and names the successor group specifically -- Vietnam alongside China, Thailand, and India -- but that particular four-country pairing hasn't yet turned up in the other independent analyses, so we're treating it as a lead worth watching, not a settled fact. Section 301 carries no statutory rate cap and no expiration date, unlike Section 122's built-in sunset.
Worth being precise about which Section 301: today's hearing is for the forced-labor investigation, but a second, separate Section 301 track -- structural excess capacity, covering 16 economies including Vietnam by name -- already held its hearings in May and is targeting completion around the same July 24 date. It has no proposed rate yet, but it is a live, independent process. The full picture is in this issue's Deep Dive.
What this means for anyone shipping to the US after July 24
Put the two pieces together: the practical question for Vietnamese exporters is which mechanism replaces the current 10% baseline on July 24, and today's hearing is one of the last inputs into that number. If the forced-labor rate finalizes at 12.5% and becomes the successor to Section 122 (rather than stacking on top of a separately reinstated framework rate), exporters should model a modest increase over their current baseline -- not the same 10% rolled forward, and not the 40%-plus scenarios some earlier coverage assumed. The full math, sector by sector, is in this issue's Deep Dive.
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