N85 W12545 Westbrook Crossing • Menomonee Falls, WI 53051

_________________________________________________________________________________________________________________________

October 5, 2018 

Submitted via regulations.gov

Ambassador Robert E. Lighthizer

U.S. Trade Representative

Office of the U.S. Trade Representative

600 17th Street NW

Washington, DC 20508

RE: Request To Consider Requests for Exclusion of Particular Products from the 

Determination of Action Pursuant to Section 301: China’s Acts, Policies, and Practices 

Related to Technology Transfer, Intellectual Property, and Innovation (USTR-2018-0025)

Dear Ambassador Lighthizer:

ECM Industries LLC (“ECM”) hereby submits this request to exclude items under the 

Harmonized Tariff Schedule of the United States (“HTS”) subheading 8536.50.9065 from the 

additional ad valorem duty of 25 percent on approximately $34 billion worth of Chinese 

imports.34

ECM is a small business with a long history of manufacturing and supplying electrical 

components and products for the construction, industrial power, and transportation markets. We 

are headquartered in Menomonee Falls, Wisconsin, and have a global presence with six locations 

across the U.S., Mexico, and China. Our legacy dates back to 1959 with the founding of Gardner 

Bender, one of our leading brands. Since then, we have built a world-class organization.

ECM employs 350 employees worldwide, of which 320 are based in the U.S. Our company is 

one of the U.S.’s preeminent suppliers of innovative and niche electrical products and systems 

and we are dedicated to providing our customers with solutions for their electrical applications. 

From lighting a commercial building to remodeling a home to providing the electrical 

connections that stand up to the harshest outdoor environments, the brands of ECM Industries 

provide the right solution for the most demanding applications.

 

34 Notice of Action and Request for Public Comment Concerning Proposed Determination of Action Pursuant to\

Section 301: China’s Acts, Policies, and Practices Related to Technology Transfer, Intellectual Property, and 

Innovation, 83 Fed. Reg. 28710 (Jun. 20, 2018). 
2

I. Product Description

We request that USTR exclude the SPST Appliance Rocker Switch that is imported under HTS 

subheading 8536.50.9065. 

Item: #GSW-42, SPST Appliance Rocker Switch

HTS subheading: 8536.50.9065

Item Description: Electrical rocker switch, made of plastic and metal component. Rocker 

attached to enclosed electric switch, where the rocker is used to operate the switch.

Material(s): Made of Plastic and metal components

Item Size (inches H x W x D): 5.2x2.4x4.5

Item Weight (ounces): 3.20

II. ECM Cannot Source the SPST Appliance Rocker Switch From Countries 

Outside Of China. 

The SPST Appliance Rocker Switch and comparable products are not available in the U.S. or 

countries outside of China. While we have explored the possibility of sourcing these products 

from other countries, there are no alternative manufacturers of the SPST Appliance Rocker 

Switch. 

Shifting to a non-Chinese source for the SPST Appliance Rocker Switch is not a viable option at 

this time. Global supply chains are extremely complex and it can take years to find the right 

partners who can meet the proper criteria and our produce the SPST Appliance Rocker Switch at 

the scale and cost that is needed. The SPST Appliance Rocker Switch is designed and packaged 

to our unique specifications and we have been working with our Chinese vendors for over 20 

years to ensure that the SPST Appliance Rocker Switch meets the high quality standards we 

expect. We have invested millions of dollars in tooling, training, and employ nearly 20 people in 

Shanghai who oversee and manage our supplier base. It is nearly impossible for us to develop 

similar relationships and supply chains in the near term to make this product.

We have explored the possibility of sourcing the SPST Appliance Rocker Switch from other 

countries. This is extremely impractical given the prohibitive cost disadvantages of other 

countries such as labor and raw material costs. Several of our Chinese suppliers have even 

looked to move their factories to countries outside of China to remain in business and continue to 

support customers such as us. However, this relocation will not happen in the near term to help 

provide tariff relief. 

Additionally, there are few viable U.S.-based sources that manufacture the SPST Appliance 

Rocker Switch. We believe that developing the necessary manufacturing capacity within 

America is technically and economically infeasible in the short term to meet our customers’ 

demand requirements. Based on our understanding, the U.S. suppliers of SPST Appliance 

Rocker Switch also import products or components from Chinese suppliers and then add some 

limited value through additional manufacturing here in the U.S. Because of this Chinese 

reliance, these suppliers have already demanded 25 percent price increase for this product. 
3

Because of this we have already run into difficulties on guaranteeing supply on the SPST 

Appliance Rocker Switch. 

III. The Imposition of this Duty on the SPST Appliance Rocker Switch Has a 

Significant Impact on ECM’s Business, Resulting in a Significant Profit Loss 

and Reduction of ECM’s Workforce. 

As you can tell from the below information, we import a significant amount of the SPST 

Appliance Rocker Switch from China and imposition of this duty will negatively impact our 

business. 

Year Value (dollars) Quantity

2015 [ [

2016 [ [

2017 [ [

The SPST Appliance Rocker Switch is already subject to a heavy duty. The proposed duty on 

the SPST Appliance Rocker Switch would cost ECM thousands of dollars in increased duties. 

The cumulative impact of the list 1 Section 301 tariffs would cost ECM millions of dollars in 

increased duties. These additional unexpected costs for our small business are layered on top of 

the detrimental impacts from the Section 301 tariffs imposed on our products on lists 1 and 2 and 

those proposed for list 3 that total over $5.9 million. Overall, these tariffs cripple ECM, forcing 

ECM to reduce its workforce in the U.S. to afford these tariffs. 

Additionally, applying this tariff on the SPST Appliance Rocker Switch will have a significant 

impact on ECM’s customers. ECM has thousands of customers, with more than 95 percent 

based in the U.S. Our customers are predominantly U.S. distributors, retailers, and 

manufacturers that distribute or use our products in electrical construction, maintenance, and 

repair applications. Because of the competitive nature of our business, and the fact we deal with 

many power buyers such as big box stores, we cannot recover the costs of the tariff on SPST 

Appliance Rocker Switch by passing it along to our customers as they are extremely price 

sensitive and will look for an alternative supplier. Imposing this tariff on our product would 

cause substantial downstream injury to those industries as well, which would eventually trickle 

down to the U.S. consumer. 

This ad valorem tariff on the SPST Appliance Rocker Switch places our company between a 

rock and a hard place. If we try and pass the full amount of the duty on to our customers, we run 

the risk of losing our contracts with major customers, and with that millions of dollars of sales 

and profits. The alternative is not a good one, and that means reducing our workforce in the U.S. 

in order to absorb the costs of this tariff. We have been a healthy and growing business and have 

not laid anyone off in over five years; in fact we have been hiring. As of July 6, 2018, we have 

implemented a hiring freeze and are only replacing critical positions as a result of attrition. 

Because of the cumulative impact of these tariffs, we will be forced to reduce our headcount by 

50 to 60 people in order to offset the costs to our bottom line. 
4

When the tariff on SPST Appliance Rocker Switch can be passed on, we expect most of the 

impact will be felt by consumers and contractors who buy and use GSW-42 in electrical 

installation and repair and remodel projects, which will ultimately have an impact on the cost of 

construction projects. In fact, a significant portion of the product is purchased by consumers 

directly at most leading retailers and hardware chains across the country.

Instead of impacting China’s manufacturing industry, the tariff on the SPST Appliance Rocker 

Switch will significantly harm ECM and our customers here in the U.S.

IV. Imposing the Ad Valorem Tariff under Section 301 on the SPST Appliance 

Rocker Switch Will Not Be Effective in Eliminating China’s Predatory Acts. 

USTR’s Section 301 report found that various policies and practices of the Chinese government 

are designed to promote Chinese companies as leaders in supplying certain advanced 

technologies around the world and to reduce imports of these technologies that Chinese 

industries rely upon. According to USTR and the White House’s Office of Trade and 

Manufacturing policy, China has participated in physical and cyber-enabled theft of 

technologies, required technology transfer for market access, and investment restrictions, among 

other coercive and intrusive restrictions that harm American intellectual property rights, 

innovation, and technology development.35

According to the various Section 301 reports, the technologies that China targets through its 

policies are advanced technologies in the following industries: (1) advanced information 

technology; (2) robotics and automated machine tools; (3) aircraft and aircraft components; (4) 

maritime vessels and marine engineering equipment; (5) advanced rail equipment; (6) new 

energy vehicles; (7) electrical generation and transmission equipment; (8) agricultural machinery 

and equipment; (9) new materials; and (10) pharmaceuticals and advanced medical devices.36

Notably, the SPST Appliance Rocker Switch and its manufacture are not among the list of 

advanced technologies or industries that are targeted by the Chinese government policies.

The SPST Appliance Rocker Switch has been on the market for many years and does not contain 

sensitive technology or intellectual property that is the target of China’s practices. In fact, ECM 

has been sourcing the SPST Appliance Rocker Switch from China since the 1990’s and has not 

experienced these challenges. To the contrary, ECM has enjoyed a constructive relationship 

with its Chinese suppliers and has not encountered any of the intellectual property theft, cyber 

theft, or other technology-related compilations that advanced technology industries have faced. 

In sum, our importation of the SPST Appliance Rocker Switch from China is not linked to any 

purportedly unfair practices. Imposing punitive tariffs on our imports would only harm our 

 

35 USTR, Findings of the Investigation Into China’s Acts, Policies, And Practices Related to Technology Transfer, 

Intellectual Property, and Innovation Under Section 301 of the Trade Act of 1974 1–2 (Mar. 22, 2018) [hereinafter 

Section 301 Findings]; Office of Trace and Manufacturing Policy, Executive Office of the President, How China’s 

Economic Aggression Threatens the Technologies and Intellectual Property of the United States and World (Jun. 

2018) [hereinafter China’s Economic Aggression].

36 Section 301 Findings, at 14. 
5

small business and the U.S. customers we serve without advancing the stated objectives of the 

Section 301 proceeding.

* * *

ECM appreciates the opportunity to request this exemption from the Section 301 tariffs. While 

we understand and support the motivation for fair trade policies and a level playing field, we 

respectfully request that the SPST Appliance Rocker Switch imported from China under HTS 

subheading 8536.50.9065 be exempt from the additional 25 percent ad valorem duty because it 

will not accomplish the desired purpose and will have a significant detrimental impact on ECM, 

the businesses we supply, and U.S. consumers.

Respectfully submitted, 

David Scheer

Chief Executive Officer

ECM Industries LLC