Section 301 just replaced Section 122 — here’s how the new two-tier tariff actually breaks down 

Two separate tariff actions landed in the same week, and both change what you pay to bring goods into the country.

At 12:01am ET on July 24, the Section 122 global tariff — the 10% surcharge that replaced the IEEPA tariffs the Supreme Court struck down in February — expired by statute. It cannot run past 150 days without an act of Congress, and Congress didn’t extend it. Since taking effect February 24, CBP’s own trade data shows the tariff generated roughly $31 billion in collections.

Four days before that, on July 20, the administration signed three proclamations imposing 50% tariffs on Canadian dairy, alcoholic beverages, and motor vehicles under Section 338 of the Tariff Act of 1930 — a statute that hasn’t seen major use since the 1930s and 40s. In Senate Finance Committee testimony on July 22, U.S. Trade Representative Jamieson Greer defended the trade posture, citing the $1.2 trillion U.S. trade deficit as a primary driver for structural tariff shifts and previewed that formal announcements on replacement measures were imminent. They were: on July 23, USTR announced its final action in the Section 301 forced-labor investigations, and CBP issued implementing guidance (CSMS #69326983) the same day, effective July 24.

If you import from Canada, or you’re tracking what comes next on the broader tariff picture, here’s what’s actually changing.

Section 122 authorizes temporary import surcharges of up to 15% to address a balance-of-payments problem, capped at 150 days. That clock ran out at 12:01am ET on July 24. USTR Ambassador Greer previewed the replacement in his July 22 Senate testimony, and the administration made it official the next day, tying it to the agency’s active investigation into forced labor across 60 economies.

The replacement duties, confirmed in USTR’s July 23 final action and CBP’s same-day implementing guidance, follow a two-tier framework:

One practical detail worth flagging: goods that were already loaded onto a vessel at the port of loading before 12:01am ET July 24, and that are entered for consumption (or withdrawn from warehouse) before 12:01am ET July 28, aren’t subject to the new duty — a four-day in-transit grace window.

Three things matter here for landed cost planning, and the stacking rules are more nuanced than a flat add-on. First, Section 301 duties generally layer on top of most existing tariffs — AD/CVD, China Section 301 duties, base HTS rates — they don’t replace them the way Section 122 replaced the old IEEPA tariffs. But where a product already carries a Section 232 duty (steel, aluminum, and similar), there’s a specific exemption that excludes it from also being hit with the new forced-labor duty, rather than stacking both; and some economies’ rates apply net of MFN duty rather than as a straight addition on top. The remedy itself also carries named exemptions under Annexes I and II of USTR’s action — so the exact classification and origin details matter more here than they would with a blanket tariff. Second, a straight renewal of Section 122 itself would have been legally shakier than it looked: the Court of International Trade already ruled in May that the administration’s use of Section 122 exceeded what the statute’s “balance-of-payments deficit” language actually authorizes. That’s very likely why the administration moved to Section 301 instead of trying to extend Section 122.

Practically: July 24 wasn’t a tariff holiday. The Section 301 duties took effect the same day Section 122 expired, on a different — and more durable — legal footing than the tariff they replaced.

The Canada tariffs are narrower than the “50% across the board” headline suggests. In testimony, USTR Greer characterized the measures as “very tailored” sector-specific actions targeting dairy, alcoholic beverages, and motor vehicles where the administration argues Canada restricts U.S. commercial access. Energy, potash, fish, critical minerals, and goods already under Section 232 are exempted. USTR also highlighted the administration’s broader objective to leverage these targeted measures toward bilateral trade agreements with Canada and Mexico by late 2026.

Crucially for importers, USMCA eligibility does not automatically exempt a product from these new duties — that’s the detail worth double-checking against your own import mix. The tariffs take effect 30 days after the July 20 proclamations, providing a brief window before duty enforcement begins.

What makes Section 338 worth watching beyond Canada: it’s a tool with no investigation requirement and no national security finding needed. If it holds up to legal challenge here, it’s a template the administration could reach for again on other trading partners without the process delays Section 301 or Section 232 require.

You’ve had three regimes in motion this week: one that just expired, one now in effect under a two-tiered Section 301 framework, and one newly revived and tailored to specific Canadian commodity sectors. For importers, that means:

Confirm which of your entries were riding on Section 122 and identify your new Section 301 rate — 10% or 12.5%, depending on origin-country forced-labor status. If you have inventory in transit, check whether it qualifies for the four-day loading exemption before assuming the new duty applies. Check your Canadian-sourced dairy, alcohol, and vehicle imports against the Section 338 exemption list, and don’t assume USMCA origin protects you here. And if you’re not sure which HTS lines and origin countries you have exposure on across all of this, that’s the conversation to have with your licensed customs broker now, not after the next proclamation lands.

This is the kind of week that separates companies with clean, entry-level documentation from companies that don’t have it. When tariff authority shifts this fast — three different legal bases inside five months — the companies keeping pace are the ones who can pull their HTS classifications and origin data on demand, not the ones reconstructing records after the fact.

Sources: White House — Fact Sheet: President Donald J. Trump Imposes Additional Tariffs on Canada (July 20, 2026); U.S. Senate Finance Committee — Hearing on U.S. Trade Policy & USTR Priorities (Testimony of Ambassador Jamieson Greer) (July 22, 2026); United States Trade Representative — USTR Takes Action in Forced Labor Section 301 Investigations (July 23, 2026); United States Trade Representative — Fact Sheet: USTR Section 301 Action in Response to the Failure of 60 Economies to Ban Imports Produced with Forced Labor (July 23, 2026); U.S. Customs and Border Protection — Cargo Systems Messaging Service, CSMS #69326983: Guidance, Section 301 Forced Labor Import Duties (July 23, 2026); U.S. Customs and Border Protection — Trade Statistics; Customs & International Trade Law Blog — Trump Invokes Section 338 to Impose Additional Duties on Canadian Imports (July 21, 2026); Transport Topics — Trump’s Section 122 tariffs expire July 24: Then what?; Global Trade Alert — Section 338: The Return of the Authority.

Headquartered in Atlanta, GA, Falcone Capital Holdings, LLC is a global leader in international and domestic transportation and logistics. Falcone Capital Holdings operates across six continents through wholly owned subsidiaries and partner offices, and is synonymous with cutting-edge services across all modes of international and domestic transportation. The Falcone Companies are licensed, bonded and insured through all federal and state agencies including Customs and Border Protection, Federal Maritime Commission (FMC), Federal Motor Carrier Safety Administration (FMCSA), Transportation Security Administration (TSA) and Department of Homeland Security (DHS), and is a Tier 2 validated member of the Customs Trade Partnership against Terrorism (C-TPAT).