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 8536.90.4000 from the 

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

imports.55

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.

 

55 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 Grounding Clip that is imported under HTS subheading 

8536.90.4000. 

Item: #GGC-1508N, Grounding Clip

HTS subheading: 8536.90.4000

Item Description: Alligator electrical charging clip with spring-loaded serrated jaws on one end 

and female portal on other end, made of plastic and metal components

Material(s): Made of Plastic and metal components

Item Size (inches H x W x D): 7.4x3.2x5.2

Item Weight (ounces): 5.560

II. ECM Cannot Source the Grounding Clip From Countries Outside Of China. 

The Grounding Clip 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 Grounding Clip. 

Shifting to a non-Chinese source for the Grounding Clip 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 Grounding Clip at the scale and cost that is 

needed. The Grounding Clip 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 Grounding Clip

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 Grounding Clip 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 Grounding Clip. 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 Grounding Clip 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. Because of this we have already run into difficulties on 

guaranteeing supply on the Grounding Clip. 
3

III. The Imposition of this Duty on the Grounding Clip 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 Grounding 

Clip from China and imposition of this duty will negatively impact our business. 

Year Value (dollars) Quantity

2015 [ [

2016 [ [

2017 [ [

The proposed duty on the Grounding Clip would cost ECM hundreds 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 Grounding Clip 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 Grounding Clip 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 Grounding Clip 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. 

When the tariff on Grounding Clip can be passed on, we expect most of the impact will be felt by 

consumers and contractors who buy and use GGC-1508N 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. 
4

Instead of impacting China’s manufacturing industry, the tariff on the Grounding Clip will 

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

IV. Imposing the Ad Valorem Tariff under Section 301 on the Grounding Clip 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.56

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.57

Notably, the Grounding Clip and its manufacture are not among the list of advanced technologies 

or industries that are targeted by the Chinese government policies.

The Grounding Clip 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 Grounding Clip 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 Grounding Clip from China is not linked to any purportedly unfair 

practices. Imposing punitive tariffs on our imports would only harm our 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 Grounding Clip imported from China under HTS subheading 

 

56 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].

57 Section 301 Findings, at 14. 
5

8536.90.4000 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