On February 6, 2020, the State Council Customs and Tariff Commission announced that starting on February 14, 2020, the Chinese government will halve the retaliatory tariffs that it put in place on September 1. Tariffs originally at 10 percent will be reduced to 5 percent, and those at 5 percent will be brought down to 2.5 percent. This is commensurate with the US reduction of its September 1 tariffs on about $120 billion in Chinese goods from 15 to 7.5 percent as part of the Phase One trade agreement.

The US government is mounting a whole-of-government approach to address national security concerns associated with ICT supply chain security vis-à-vis China. Actions taken by the executive, legislative, and judicial branches are both inward- and outward-looking. These approaches would have implications for the ability of US companies to continue engaging with certain Chinese customers.

The current novel coronavirus outbreak poses several challenges for companies in affected areas and their employees. Lessons learned during the 2003 SARS outbreak can inform some commercial best practices. Companies that have contingency plans for closures and quarantines will have a head start coordinating next steps.

The system is still far from comprehensive implementation, with several bureaucratic challenges remaining. It is still too early to estimate a measurable impact on companies. The biggest risk for companies to-date is inaccurate data captured in the various social credit databases. Companies should monitor their records vigilantly in sector-specific databases.