Tariff Extension Highlights the Importance of Compliance in U.S. Manufacturing Setup

This week, the Office of the United States Trade Representative (USTR) confirmed that the Section 301 tariffs on certain Chinese imports—including machinery components, electronics, and chemical materials—will likely remain in place. These items are critical for factory equipment sourcing and industrial operations in the U.S.

Implications for Manufacturing & Compliance

• Higher Import Costs for Industrial Equipment

Rising tariffs increase the cost of importing essential manufacturing machinery and components. Businesses planning U.S. factory setups need to re-evaluate their procurement budgets and explore cost-control strategies, such as local sourcing or phased equipment investment.

• Tariff Classification and Documentation Risks

Incorrect tariff classification or incomplete documentation may lead to higher duties, customs penalties, or shipment delays. Companies must ensure accurate Harmonized System (HS) code determination and maintain proper import records to comply with U.S. Customs requirements.

• Compliance Gaps in Vendor Qualification and Labor Law

Compliance risks extend beyond tariff issues to include vendor qualification, labor law compliance, and environmental, health, and safety (EHS) standards. Poor supplier due diligence or non-compliance with U.S. labor laws (such as OSHA or wage regulations) may result in legal exposure and reputational damage.

• Strategic Shift to Nearshoring and Alternative Sourcing

To mitigate tariff risks and supply chain disruptions, more companies are exploring nearshoring options (e.g., Mexico-based manufacturing) and diversifying their supplier base. A proactive assessment of sourcing alternatives helps ensure business continuity and resilience.

For international businesses expanding into the U.S., tariff policy is only part of the equation—compliance across licensing, labor, safety, and supply chain due diligence is equally essential. OneLink recommends integrating regulatory compliance planning into manufacturing strategies to ensure sustainable and risk-managed operations.